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Narayan v. County of Sacramento

United States District Court, E.D. California

January 3, 2020

PRAKASH NARAYAN, Plaintiff,
v.
COUNTY OF SACRAMENTO, et al., Defendants.

          FINDINGS AND RECOMMENDATIONS (ECF NO. 29.)

          CAROLYN K. DELANEY UNITED STATES MAGISTRATE JUDGE

         Presently before the court is defendant Wells Fargo's motion to dismiss brought pursuant to Rule 12(b)(6) and 12(b)(7). (ECF No. 29). Plaintiff filed a response, and the court held a hearing on Wells Fargo's motion on December 18, 2019. (ECF Nos. 35, 45.) For the following reasons, the court recommends granting defendant's motion and dismissing plaintiff's action against Wells Fargo.

         BACKGROUND

         Pro se plaintiff Prakash Narayan filed the present suit against Wells Fargo, Sacramento County, the City of Sacramento, and related entities. The complaint alleges improper property taxes and utility charges were assessed against plaintiff's property and that Wells Fargo, the creditor for the property, created an illegal escrow account to pay these charges. Plaintiff's first amended complaint has five numbered counts, premised on the Fair Debt Collect Practices Act (FDCPA), and two unnumbered counts, public corruption and tampering. (ECF No. 12.)

         Wells Fargo makes four arguments for dismissal: (1) plaintiff's complaint is insufficiently pleaded pursuant to Rule 8(a)(2); (2) plaintiff failed to join a necessary party, his wife who also signed the contract in dispute, warranting dismissal under Rule 12(b)(7); (3) plaintiff's claims are premised on an incorrect reading of the contract at issue; and (4) all of plaintiff's individual causes of action fail to state a claim. Because the undersigned recommends dismissal premised on the last two points, the court does not address defendant's first two points.

         DISCUSSION

         Legal standard

         In considering a motion to dismiss for failure to state a claim upon which relief can be granted, the court must accept as true the allegations of the complaint in question, Erickson v. Pardus, 127 S.Ct. 2197, 2200 (2007), and construe the pleading in the light most favorable to the plaintiff, see Scheuer v. Rhodes, 416 U.S. 232, 236 (1974).

         In order to avoid dismissal for failure to state a claim a complaint must contain more than “naked assertions, ” “labels and conclusions” or “a formulaic recitation of the elements of a cause of action.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555-557 (2007). In other words, “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements do not suffice.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Furthermore, a claim upon which the court can grant relief has facial plausibility. Twombly, 550 U.S. at 570. “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678.

         In ruling on a motion to dismiss pursuant to Rule 12(b), the court “may generally consider only allegations contained in the pleadings, exhibits attached to the complaint, and matters properly subject to judicial notice.” Outdoor Media Group, Inc. v. City of Beaumont, 506 F.3d 895, 899 (9th Cir. 2007). Defendant has requested this court take judicial notice of certain documents. (ECF No. 29-1 at 2.) That request is granted.

         The deed allows Wells Fargo to create an escrow account

         Although difficult to decipher, all plaintiff's claims against Wells Fargo appear to arise from Wells Fargo's alleged unlawful creation of an escrow account for tax and utility liabilities. (See ECF No. 12 at 3 (“Plaintiff is a consumer borrower and has valid loan with defendant Wells Fargo Bank that was signed and agreed plaintiff will have no escrow account Exhibit B. Defendant Wells Fargo Bank violated written legal cont[r]act and instrument by adding escrow account”); id. (“Wells Fargo Bank violated written legal cont[r]act and instrument by adding escrow account.”).)

         However, the deed explicitly allows Wells Fargo to create an escrow account for liabilities including “taxes and assessments and other items which can attain priority over this Security Instrument as a lien or encumbrance on the Property.” (ECF No. 29-1 at 9.) If plaintiff fails to pay the escrow items, pursuant to a waiver, Wells Fargo can pay such amounts directly and seek reimbursement from plaintiff. (Id.)

         Here, plaintiff's complaint against Wells Fargo is largely, if not entirely, premised on Wells Fargo allegedly paying property taxes and utility assessments, which are “Escrow Items” as defined in the deed. (See id.) Because property taxes and utility items statutorily have priority over other liens, and the deed allows Wells Fargo to pay and seek a refund for “taxes and assessments . . . which can attain priority over this Security Instrument as a lien, ” Wells Fargo was within its rights under the deed to pay these escrow amounts and assess those charges against plaintiff. (Id.); see also Cal. Rev. & Tax Code § 2192.1 (“Every tax declared in this chapter to be a lien on real property … have priority over all other liens on the property, regardless of the time of their creation”); Sacramento City Code 13.12.100(F) (delinquent utility charges create a lien that is “paramount to all other liens except those for state, county, and municipal taxes, with which it shall be on parity”). It was therefore within Wells Fargo's rights to pay the delinquent property ...


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