JOEL D. JOHNSON v. SPECIALIZED LOAN SERVICING LLC

Appeal from the United States District Court for the Northern District of Georgia
D.C. Docket No. 3:20-cv-00161-TCB

FEB 3, 2022 | REPUBLISHED BY LIT: FEB 5, 2022

Before ROSENBAUM, JILL PRYOR, and BRASHER, Circuit Judges.

PER CURIAM:

Joel Johnson, proceeding pro se, appeals the dismissal of his civil action against Specialized Loan Servicing, LLC (“SLS”), the servicer of a loan Johnson entered into with Bank of America.

Johnson’s loan was secured by a deed on a piece of property he owned. Johnson brought the case, in which he challenged his impending property foreclosure, in state court.

SLS removed it to federal court and successfully moved to dismiss it under Rule 12(b)(6), Fed. R. Civ. P., for failure to state a claim upon which relief could be granted.

On appeal, Johnson raises two issues.

First, he argues that the district court applied an incorrect legal standard by not construing his complaint liberally and by requiring him to meet the federal pleading standard rather than the more relaxed standard that Georgia uses.

Second, Johnson argues that the district court erred in dismissing his complaint because he sufficiently stated claims upon which relief could be granted.

I.

We review de novo a district court’s grant of a motion to dismiss under Rule 12(b)(6) for failure to state a claim, accepting the allegations in the complaint as true and construing them in the light most favorable to the plaintiff.

Castro v. Sec’y of Homeland Sec., 472 F.3d 1334, 1336 (11th Cir. 2006).

Federal Rule of Civil Procedure 8(a)(2) requires that a complaint provide “a short and plain statement of the claim showing that the pleader is entitled to relief.”

In Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007), the Supreme Court expressly replaced the “no set of facts” pleading standard established in Conley v. Gibson, 355 U.S. 41, 47 (1957). Am. Dental Ass’n v. Cigna Corp., 605 F.3d 1283, 1288 (11th Cir. 2010).

Under the Twombly standard, to survive a Rule 12(b)(6) motion to dismiss, a plaintiff must plead “enough facts to state a claim to relief that is plausible on its face.” 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.”

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

“Detailed factual allegations” are not required, but the complaint must contain more than a “formulaic recitation of the elements of a cause of action” or “naked asser- tions” that are “devoid of further factual enhancement.” Id.

Before we address the merits of whether the district court erred in concluding that Johnson failed to state a claim upon which relief could be granted, we address two preliminary arguments Johnson makes. First, Johnson argues that the district court erred by not liberally construing his pro se complaint.

Complaints brought pro se are “held to a less stringent standard than pleadings drafted by attorneys and are liberally construed.”

Bingham v. Thomas, 654 F.3d 1171, 1175 (11th Cir. 2011).

“[A]lthough we are to give liberal construction to the pleadings of pro se litigants, we nevertheless have required them to conform to procedural rules.”

Albra v. Advan, Inc., 490 F.3d 826, 829 (11th Cir. 2007) (quotation marks omitted).

The liberal construction afforded pro se complaints does not mean that we can “act as de facto counsel or re-write an otherwise deficient pleading to sustain an action.”

Bilal v. Geo Care, LLC, 981 F.3d 903, 911 (11th Cir. 2020).

The district court acknowledged that it was required to liberally construe John- son’s complaint. Still, Johnson’s complaint was required to adhere to all procedural rules, including Rule 8(a)(2), Fed. R. Civ. P. And as we explain in addressing the merits, Johnson’s complaint failed to satisfy that requirement.

Second, Johnson asserts that the district court should have applied a notice-pleading standard because that is the standard that Georgia state courts apply. But the case was removed to federal court, and the federal pleading standard applies to cases removed to federal court.

See Fed. R. Civ. P. 81(c)(1) (providing that the Federal Rules of Civil Procedure “apply to a civil action after it is removed from a state court”);

Bilal, 981 F.3d at 908, 911 (applying federal standard to dismissal of removed case).

The district court applied the correct legal standard in dismissing Johnson’s complaint.

Because the action was removed to federal court, Johnson was required to plead enough facts to state a claim to relief that was plausible on its face.

II.

That brings us to the merits.

Johnson argues, for the first time on appeal, that the loan documents were void because the notary failed to include the date of notarization.

We will consider an issue raised for the first time on appeal in only five special circumstances:

(1) when the issue involves a pure question of law and refusal to consider it would result in a miscarriage of justice,

(2) when the appellant raises an objection to an order which he had no opportunity to raise at the lower court level,

(3) when the interest of substantial justice is at stake,

(4) when proper resolution is beyond any doubt,

or

(5) when the issue presents significant questions of general impact or of great public concern.

Finnegan v. Comm’r, 926 F.3d 1261, 1271–72 (11th Cir. 2019).

None of these circumstances apply, so we do not consider Johnson’s argument about the notary’s failure to include the date of notarization.

Moreover, under Georgia law, a deed is valid between the parties, even if it is not witnessed and attested according to statutory requirements, so long as it is signed by the grantor.

See Hooten v. Goldome Credit Corp., 481 S.E.2d 550, 551 (Ga. Ct. App. 1997)

(noting that a deed to secure debt was signed by the buyor/grantor, and that “[t]his alone would constitute a valid deed between the parties”);

see also Hoover v. Mobley, 31 S.E.2d 9, 12 (Ga. Sup. Ct. 1944)

(“In the absence of any witness whatever, a deed signed by the grantor is binding between the parties thereto.”).

Johnson, the grantor, signed the deed, so his claim that the deed was invalid because of an insufficient number of attesting witnesses fails under Georgia law.

The deed is enforceable against Johnson.

The district court also did not err in dismissing the rest of Johnson’s claims.

His claims regarding the loan were conclusory and factually unsupported and, in any event, were directed at the lender Bank of America, who is not a party to the case.

Johnson’s claim regarding the failure to provide periodic statements was similarly directed at Bank of America, and he failed to plausibly plead how this alleged failure would entitle him to the relief he requested.

On appeal, Johnson argues that the failure to provide periodic statements concealed the alleged defect in the deed (the notary’s failure to include the date).

But the alleged defect was apparent from the face of the deed, so the failure to furnish periodic statements did not conceal it.

See In re Simpson, 544 B.R. 913, 920 (Bankr. N.D. Ga. 2016) (failure to include date of acknowledgment on a deed was a patent defect).

In any event, as previously dis- cussed, the failure to include the date of notarization did not render the deed unenforceable against Johnson under Georgia law.
See Hooten, 481 S.E.2d at 551.

Accordingly, we affirm.

AFFIRMED.

Its 11th Circuit’s Noah’s Ark, 2 besties who violate the rule of law in attendance at the Federalist Society, again.
That would be Judges Liz Branch and Britt Grant. Visit https://t.co/Kpzfchw1wZ to learn the truth about injustice in Federal Courts. #WeThePeople https://t.co/EOQeHoDfoE pic.twitter.com/XIKFTMH7ob

— LawsInTexas (@lawsintexasusa) February 5, 2022

JOEL D. JOHNSON v. SPECIALIZED LOAN SERVICING LLC

 United States District Court for the Northern District of Georgia
D.C. Docket No. 3:20-cv-00161-TCB

JUN 9, 2021 | REPUBLISHED BY LIT: FEB 5, 2022

O R D E R

This case comes before the Court on Defendant Specialized Loan Servicing, LLC’s (“SLS”) motion [5] to dismiss and Plaintiff Joel D. Johnson’s motion [7] to remand.

I. Background

This case stems from foreclosure proceedings involving a residence located at 130 Winona Drive, Fayetteville, Georgia, 30214 (hereinafter, “the property”).

At this stage in the proceeding, the Court presumes the factual averments in the complaint are true.

Though the averments are by no means clear, the Court summarizes them below.

In 2003, Johnson was given a line of credit by Bank of America that was secured by the property.

Johnson avers that he was solicited by Bank of America Manager Lydia Morris and “persuaded to participate in their in-branch quota program,” but that he “did not want or need a line of credit on his debt free property which[] never could be repaid with in [sic] this fraudulent scheme.” [1-1] at 5.

On September 5, 2003, Johnson executed the security deed in Morris’s office, and she signed as the unofficial witness.

According to Johnson, no one other than Morris was present as a witness. The deed was later notarized.

It was filed and recorded in the real estate records of Fayette County on September 18.

Regarding the Bank of America loan, Johnson alleges that he “relied on due diligence by the lender but, the overall transaction was ‘Predatory’ and exposed evidence of many violations, because the lender lied about the terms of the agreement, inter alia.” [1-1] at 6.

On February 3, 2014, Johnson filed for bankruptcy.

He avers that “[s]ince that event Bank of America never sent the plaintiff any statement of account for payment nor did they attempt to foreclose on the property in over six (6) years.” Id. at 9.

In September 2019, Bank of America transferred servicing of Johnson’s loan to Defendant SLS.

The account has since been transferred to MEB Loan Trust IV, which is serving solely as trustee.

The Fayette County land records do not reveal any attachments to or assignments of the security deed.

On July 1, 2020, SLS mailed Johnson a notice of default and notice of intent to foreclose on the property.

On July 21, Johnson brought this pro se civil action for injunctive and declaratory relief in the Superior Court of Fayette County.1

The complaint alleges that due to numerous violations of federal and state law relating to the loan and security deed, SLS does not have authority to foreclose on the property.

Regarding the security deed, the complaint alleges violations of O.C.G.A. §§ 44-5-30, 44-14-33, and 44-14-61.

Regarding the loan, it alleges violations of the Truth in Lending Act (“TILA”), 15 U.S.C. § 1601 et seq.;

the Georgia Fair Lending Act, O.C.G.A. § 7-6A-1 et seq.;

the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692 et seq.;

the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2601 et seq.;

the Home Ownership and Equity Protection Act (“HOEPA”),O.C.G.A § 11-3-203(b);

and breach of the duty of good faith and fair dealing.2

On August 28, SLS timely removed the action to this Court, invoking diversity and federal-question jurisdiction.

SLS now moves to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim.

Johnson has also filed a motion to remand.

II. Legal Standard

Federal Rule of Civil Procedure 8(a)(2) requires that a complaint provide “a short and plain statement of the claim showing that the pleader is entitled to relief[.]”

This pleading standard does not require “detailed factual allegations,” but it does demand “more than an unadorned, the-defendant-unlawfully-harmed-me accusation.”

Chaparro v. Carnival Corp., 693 F.3d 1333, 1337 (11th Cir. 2012)(quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)).

To survive a 12(b)(6) motion to dismiss, a plaintiff must plead “enough facts to state a claim to relief that is plausible on its face.”

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007); Chandler v. Sec’y of Fla. Dep’t of Transp., 695 F.3d 1194, 1199 (11th Cir. 2012) (quoting id.).

The Supreme Court has explained this standard as follows:

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.

The plausibility standard is not akin to a “probability requirement,” but it asks for more than a sheer possibility that a defendant has acted unlawfully.

Iqbal, 556 U.S. at 678 (citation omitted) (quoting Twombly, 550 U.S. at 556);

see also Resnick v. AvMed, Inc., 693 F.3d 1317, 1324–25 (11th Cir. 2012).

Thus, a claim will survive a motion to dismiss only if the factual allegations in the complaint are “enough to raise a right to relief above the speculative level.”

Twombly, 550 U.S. at 555–56 (citations omitted).

“[A] formulaic recitation of the elements of a cause of action will not do.” Id. at 555 (citation omitted).

While all well-pleaded facts must be accepted as true and construed in the light most favorable to the plaintiff, Powell v. Thomas, 643 F.3d 1300, 1302 (11th Cir. 2011), the Court need not accept as true the plaintiff’s legal conclusions, including those couched as factual allegations, Iqbal, 556 U.S. at 678.

Accordingly, evaluation of a motion to dismiss requires two steps:

(1) eliminate any allegations in the pleading that are merely legal conclusions, and

(2) where there are well-pleaded factual allegations, “assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.”

Iqbal, 556 U.S. at 679.

Complaints pleaded pro se are “held to a less stringent standard than pleadings drafted by attorneys and are liberally construed.”

Bingham v. Thomas, 654 F.3d 1171, 1175 (11th Cir. 2011) (citation and internal quotation marks omitted).

The Court “must look beyond the labels of filings by pro se plaintiffs to interpret them under whatever statute would provide relief.”

Wilkerson v. Georgia, 618 F. App’x 610, 611 (11th Cir. 2015) (per curiam) (alterations and citation omitted).

However, the Court cannot rewrite a deficient pleading, and pro se plaintiffs are required to comply with the threshold requirements of the Federal Rules of Civil Procedure.

Lizana-Jackson v. U.S. Dep’t of the Treasury, No. 1:13-cv-3815-AT, 2013 WL 7118115, at *2 (N.D. Ga. Nov. 25, 2013) (citing Moon v. Newsome, 863 F.2d 835, 837 (11th Cir. 1989)).

III. Discussion

A. Motion to Remand

Pursuant to 28 U.S.C.§ 1447(c), Johnson moves to remand the case on two grounds: (1) procedural defect, and (2) lack of subject- matter jurisdiction.

First, Johnson argues that SLS did not fully comply with the procedure for removal because it did not include true and correct copies of all process, pleadings, and orders received by SLS in the Fayette County action.

See 28 U.S.C. § 1446(a) (requiring a removing defendant to include with its notice of removal “all process, pleadings, and orders served upon such defendant”).

Specifically, Johnson complains that SLS failed to include with the notice of removal the certificate and affidavit of service certifying that SLS was properly served with the summons, notice of hearing, and complaint.

However, as SLS points out, the certificate and affidavit of service are not process, pleadings, or orders served upon SLS. SLS properly included in the notice of removal the summons, notice of hearing, and complaint and thus fully complied with the requirements of § 1446(a).3

Second, Johnson argues that removal is inappropriate because an LLC unwilling to disclose the identity and citizenship of its members cannot successfully invoke diversity jurisdiction.

But unlike the defendant in in Rolling Greens MHP, LP v. Comcast SCH Holdings LLC, 374 F.3d 1020 (11th Cir. 2004)—the primary case on which Johnson relies—SLS sufficiently provided the citizenship of its sole member in its notice of removal:

The sole member of SLS is Specialized Loan Servicing Holdings, LLC, a Delaware limited liability company, with its principal place of business in Illinois.

The sole member of Specialized Loan Servicing Holdings, LLC is Computershare Mortgage Services LLC d/b/a Computershare Loan Services, a Delaware limited liability company, with its principal place of business in Illinois.

The sole member of Computershare Mortgage Services LLC is Computershare US Investments LLC, a Delaware limited liability company, with its principal place of business in Illinois.

The sole [member of] Computershare US Investments LLC is Computershare Holdings Inc., a Delaware corporation, with its principal place of business in Illinois.

[1] ¶ 5. Accordingly, Johnson’s motion [7] for remand will be denied.4

B. Motion to Dismiss

SLS moves to dismiss the complaint, arguing that

(1) it fails to state any plausible claims for relief,

and

(2) Johnson is unable to obtain the relief requested.

1. Merits of the Claims

a. Security Deed Claim

Johnson claims that the security deed is invalid or void because its execution violated the requirement under Georgia law that the signing of a deed be attested by two witnesses.

SLS argues that the claim must be dismissed because allegations that a security deed was improperly witnessed are insufficient to void the deed.

“Georgia law is clear that for a deed to be enforceable, a witness need not be present at the signing.”

Burgos v. Sand Canyon Corp., 813 F. App’x 363, 367 (11th Cir. 2020) (per curiam) (citing Hooten v. Goldome Credit Corp., 481 S.E.2d 550, 551 (Ga. Ct. App. 1997)).

“Despite a statutory requirement that the signature of the maker of a deed must be attested by two witnesses, the requirement relates only to the record ability [sic] of the instrument, and a deed may be valid between the parties without attestation.”

Hooten, 481 S.E.2d at 551 (quoting Bramblett v. Bramblett, 310 S.E.2d 897, 898 (Ga. 1984))

(finding that the buyer/grantor’s signature alone constituted a valid security deed between the parties).

Thus, under Georgia law, Johnson’s “allegation that a deed was improperly witnessed ‘is insufficient to void the deed to secure debt,
since a deed without attestation conveys the title as against the grantor and his heirs.’”

Burgos, 813 F. App’x at 367 (quoting Budget Charge Accts., Inc. v. Peters, 96 S.E.2d 887, 889 (Ga. 1957)).

And Johnson does not contest the validity of his own signature.

Accordingly, the claim will be dismissed.5

b. Loan Claims

Though the factual averments in the complaint are sparse and vague, Johnson seems to claim that his loan from Bank of America is void under federal and state law against predatory, discriminatory, and otherwise unfair and fraudulent practices.

SLS contends that the claims must be dismissed because they are conclusory and unsupported by sufficient facts.

The Court agrees.

In his complaint, Johnson summarily lists the federal and state statutes violated by the loan without providing facts showing SLS’s failure to comply with the statutes.6

These conclusory allegations are not sufficient to state any plausible claims for relief.

Iqbal, 556 U.S. at 678 (“A pleading that offers ‘labels and conclusions’” will not satisfy Rule 8’s pleading standard, “[n]or does a complaint suffice if it tenders ‘naked assertion[s]’ devoid of ‘further factual enhancement.’” (quoting Twombly, 550 U.S. at 555, 557)).7

2. Equitable Relief

Johnson seeks the “equitable reformation of contract” (or more likely, rescission); a temporary and permanent injunction preventing foreclosure; and a declaration that the security deed in question is void and unenforceable. [1-1] at 11.

SLS contends that Johnson is barred from obtaining equitable relief because he has not tendered the amount due on the loan.

“Under the usual rule, before [a plaintiff] would be entitled to equitable relief, she must do equity and tender the amount due under the security deed and note.”

Sapp v. ABC Credit & Inv. Co., 253 S.E.2d 82, 87 (Ga. 1979) (citing Berry v. Gov’t Nat’l Mortg. Ass’n, 202 S.E.2d 450, 450 (Ga. 1973)

(affirming dismissal of a complaint seeking to set aside a foreclosure where the plaintiff had not made any tender of past due payments));

see Taylor, Bean & Whitaker Mortg. Corp. v. Brown, 583 S.E.2d 844, 850 (Ga. 2003)

(“[A] plaintiff may not use equity to obtain the cancellation of a security deed or promissory note if the

plaintiff has not paid the note or tendered payment of the note.” (citations omitted)).

This rule may not apply where the plaintiff alleges that no sums are due and the instrument in question is void.

Sapp, 253 S.E.2d at 87.

However, Johnson’s conclusory allegations that the loan is void are not sufficient to excuse tender. Id.

(adding that “a mere allegation in a complaint that ‘no sums are due’ may not be sufficient to excuse tender”);

see also Owens v. Bank of Am. N.A., No. 3:15-cv-65-TCB-RGV, 2015 WL 12507425, at *8 n.12 (N.D. Ga. Dec. 4)

(noting that the plaintiffs’ “mere conclusory allegation that they do not owe [Defendant] ‘a single dime’” was insufficient to place the debt at issue and thus excuse tender), report and recommendation adopted, 2015 WL 11978537 (N.D. Ga. Dec. 30, 2015).

And given “the Court’s finding that [Johnson] has failed to state a claim upon which relief may be granted, there are no allegations demonstrating the existence of an actual controversy;

[Johnson], therefore, is not entitled to a declaratory judgment.”

McFarland v. BAC Home Loans Servicing, LP, No. 1:11-cv-4061-RWS, 2012 WL 2205566, at *4 (N.D. Ga. June 14, 2012)

(citing O.C.G.A. § 9-4-2(a)).

In sum, because the complaint fails to state a viable claim against SLS, Johnson’s claims for equitable relief lack any substantive basis and are therefore due to be dismissed.

IV. Conclusion

For the foregoing reasons, Johnson’s motion [7] to remand is denied, and SLS’s motion [5] to dismiss is granted. The Clerk is directed to close this case.

IT IS SO ORDERED this 9th day of June, 2021.

Timothy C. Batten, Sr.
Chief United States District Judge