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Ward v. Community Development Administration

United States District Court, D. Maryland

August 7, 2018

DONNA WARD, Plaintiff,
v.
COMMUNITY DEVELOPMENT, ADMINISTRATION, et al., Defendants.

          MEMORANDUM OPINION

          Paula Xinis, United States District Judge.

         This Memorandum Opinion addresses the pending motions to dismiss filed by Defendants Byron L. Huffman, ECF No. 23; Bogman, Inc., Erin M. Brady, Chastity Borwn, Laura T. Curry, Jonathan Elfant, Laura L. Latta, McCabe, Weiberg & Conway, and Laura H.G. O'Sullivan, Diana C. Theologou, ECF No. 25; Qamer Ghumman, ECF No. 26; and Community Development Administration and Jeanne Mullen, ECF No. 27. The issues are fully briefed, and the Court now rules pursuant to Local Rule 105.6 because no hearing is necessary. For the reasons stated below, the Defendants' motions are GRANTED.

         I. BACKGROUND

         This factual background is based on the Amended Complaint and the public record, which includes cases in the Circuit Court for Prince George's County, Maryland, and this Court.[1]

         This case arises out of the foreclosure against property previously owned by Plaintiff, Donna M. Ward (“Ward”), located at 1918 St. Bernandine Way, in Hutchinson Commons, a subdivision located in Capitol Heights, Maryland (the “Property”). ECF No. 22 at ¶ 26. Ward purchased the Property with the assistance of a Note prepared by the Community Development Administration (“CDA”), a government entity within the Maryland Department of Housing and Community Development (“DHCD”). ECF No. 22 at ¶¶ 7, 26-28. The Note executed in favor of CDA required repayment of a principal sum of $68, 090, plus 5% annual interest, over a 30-year period (the “CDA Note”). The purchase of the Property was also encumbered by liens filed by U.S. Department of Housing and Urban Development (HUD) and the Housing Authority of Prince George's County. Ward alleges that CDA “delegated its right to collect from Plaintiff secured sums when due” to Defendant Bogman, Inc. (“Bogman”). ECF No. 22 at ¶ ¶ 9 & 37. Bogman is a Maryland corporation with its principal place of business in Silver Spring, Maryland. ECF No. 22 at ¶ 9. Ward made her mortgage payments to Bogman.

         In April 2011, Ward lost her job and fell behind her mortgage payments. ECF No. 22 at ¶¶ 40-41. On September 6, 2011, Bogman sent Ward a “notice of intent to foreclose” (NOI). ECF No. 22 at ¶ 42. Ward attempted to avoid foreclosure, and received from Bogman information related to default assistance programs. ECF No. 22 at ¶¶ 45-46. Ward continued to make payments when able, and Bogman repeatedly accepted Ward's delinquent payments. ECF No. 22 at ¶¶ 47-49.

         Ward did not submit timely payments in December, January, and February 2012, and on or about April 3, 2012, Ward received another “notice of intent to foreclose” letter from Bogman. ECF No. 22 at ¶¶ 49-50. Over the next several months, Ward discussed with Bogman employees on several occasions different loss mitigation strategies. ECF No. 22 at ¶¶ 51-64. Bogman's employees gave Ward conflicting advice about avoiding foreclosure, and Ward was twice required to submit a loss mitigation application. ECF No. 22 at ¶¶ 51-64. While her loss mitigation application was pending, Ward did not submit any monthly payments, on the advice of a Bogman employee. ECF No. 22 at ¶¶ 55 & 61.

         On October 3, 2012, Ward received another notice of intent to foreclose from Bogman. The letter stated that Ward owed $2, 826.84, but the actual sum owed, according to Ward, was $2, 077.00. ECF No. 22 at ¶ 62. Ward did not respond to this notice, again on the advice of a Bogman employee. ECF No. 22 at ¶ 72.

         “A few days after December 17, 2012, ” Ward learned that her loss mitigation application was denied. ECF No. 22 at ¶ 66. Ward believes that Bogman had never intended to grant her relief. ECF No. 22 at ¶ 67. The letter informing Ward of the denial also demanded that Ward cure her six-month mortgage arrears by making a lump sum payment of $4, 249.40 within two weeks, or risk foreclosure and sale of the Property. ECF No. 22 at ¶ 68. Then, on or about February 28, 2013, Defendant Elefant, acting “as both a substitute trustee and the attorney for the Substitute Trustees” filed an Order to Docket in the Circuit Court for Prince George's County (“Prince George's County Circuit Court”), to procure a decree for the sale of the Property. ECF No. 22 at ¶ 79.

         On or about March 13, 2013, Ward was notified by mail that “in February 2013, [DHCD] authorized [Bogman] to commence a foreclosure action, which is now in process.” ECF No. 22 at ¶ 75. Ward contends that the foreclosure ensued because she did not respond to the October 3, 2012 written notice of intent to foreclose. ECF No. 22 at ¶ 76. On or about May 5, 2013, the Clerk of the Prince George's County Circuit Court authorized the Property sale. ECF No. 22 at ¶ 80. According to Ward, the Prince George's County Circuit Court could not order sale of the property because the Court lacked personal jurisdiction over her and had wrongfully denied her the opportunity to defend against “Bogman's falsely declared default and CDA's unenforceable remedial right to forfeit and convey [Ward's] legally protected title.” ECF No. 22 at ¶ 80.

         Ward requested to engage in post-file foreclosure mediation which took place on May 3, 2013. ECF No. 22 at ¶¶ 81-82. At the mediation conference, Ward's father offered to pay the delinquent sum, but Defendant Brady, who was acting as CDA's attorney under Ward's account, declined to provide the amount needed, instead stating that Brady could not accept the check or approve a repayment plan. ECF No. 22 at ¶¶ 82-83. Ward claims that although Brady could have accepted the check, Brady instead refused so CDA could continue the foreclosure proceeding. ECF No. 22 at ¶¶ 83-84. As a result, Ward argues, the administrative judge was forced to inform Prince George's County Circuit Court that the mediation was unsuccessful. ECF No. 22 at ¶¶ 86-87.

         In an attempt to prevent the foreclosure action from proceeding, Ward filed Chapter 13 bankruptcy. ECF No. 22 at ¶ 88. During the bankruptcy proceedings, Ward asserts that Defendants interfered with her legal rights, and caused the bankruptcy proceeding to be “more burdensome and costly.” ECF No. 22 at ¶¶ 89-90. During the bankruptcy proceeding, Bogman continued to accept Ward's monthly payments, but upon dismissal of the bankruptcy action, Bogman began rejecting the monthly payments. ECF No. 22 at ¶ 91.

         On or around July 5, 2015, Ward received a “Notification to Party of Contemplated Dismissal, ” informing her that Prince George's County Circuit Court had issued a show cause order to the Substitute Trustees as to why the foreclosure proceeding should not be dismissed for lack of prosecution. ECF No. 22 at ¶¶ 93-94. On August 7 and October 16, 2015, the Substitute Trustees moved to defer or suspend dismissal, which Ward opposed. ECF No. 22 at ¶¶ 95-96. Ward alleges that the Substitute Trustees failed to show the Prince George's County Circuit Court “cause for continuing the foreclosure action.” ECF No. 22 at ¶ 98. As a result, Ward believed that the foreclosure action had been dismissed in early December 2015, and Ward took no further action. ECF No. 22 at ¶¶ 98-99. In actuality, the foreclosure proceeded and the Property was sold at auction on November 2, 2015 to HUMG, LLC (“HUMG”). ECF No. 26-2, Brady v. Malloy, CAE13-04955 (Cir. Ct. for Prince George's Cty. 2016); ECF No. 26-3, HUMG LLC v. Malloy, 0501SP076182016 (Dist. Ct. for Prince George's Cty. 2016); 26-4. HUMG's sole member is Defendant Qamer Ghumman (“Ghumman”), ECF No. 26, and Defendant Byron L. Huffman, Esq. (“Huffman”) represented HUMG in the foreclosure action. See Brady v. Malloy, CAE13-04955 (Cir. Ct. for Prince George's Cty. 2016); HUMG LLC v. Malloy, 0501SP076182016 (Dist. Ct. for Prince George's Cty. 2016).

         Ward asserts that at an unspecified time prior to May 2, 2016, she had received notice that the Property had been alienated, “or that CDA had conveyed or assigned its equitable right to a third party.” ECF No. 22 at ¶ 102. Ghumman appeared at the Property on or about May 2, 2016, asserting that he had acquired the Property in a foreclosure sale. ECF No. 22 at ¶ 101. Then, on or about July 14, 2016, Prince George's Circuit Court ratified the property sale to HUMG. ECF No. 22 at ¶ 104; see also Brady v. Malloy, CAE13-04955 (Cir. Ct. for Prince George's Cty. 2016). Ward moved to set aside the ratification of foreclosure ...


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