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Estate of Bessette v. Wilmington Trust, N.A.

United States District Court, E.D. Michigan, Southern Division

November 28, 2016

WILMINGTON TRUST, N.A., Successor Trustee to Citibank N.A. as Trustee for Structured Asset Mortgage Investments II Trust 2007-AR1 Mortgage Pass-Through-Certificates Series 2007-AR1; SELECT PORTFOLIO SERVICING, INC.; QUICKEN LOANS, INC.; and MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., Defendants.

         At a session of said Court, held in the U.S. Courthouse, Detroit, Michigan on November 28, 2016


          Honorable Gerald E. Rosen United States District Judge


         This mortgage foreclosure case is presently before the Court on the Motion to Dismiss filed by Defendants Wilmington Trust, N.A. (“Wilmington”), Select Portfolio Servicing, Inc. (“Select”), Quicken Loans, Inc. (“Quicken”) and Mortgage Electronic Registration Systems, Inc. (“MERS”).[1] The Plaintiff Estate of Doreen Bessette, through counsel, responded to Defendants' motion, and Defendants have replied. Having reviewed and considered the parties' briefs and supporting exhibits, the Court has determined that the pertinent allegations and legal arguments are sufficiently addressed in these materials and that oral argument would not assist in the resolution of this motion. Accordingly, the Court will decide Defendants' motion “on the briefs.” See L.R. 7.1(f)(2). This Opinion and Order sets forth the Court's ruling.


         On October 10, 2006, Doreen Bessette obtained a $199, 000 loan from Defendant Quicken Loans for the refinance of residential property she owned in Farmington Hills, Michigan. As security for the loan, Ms. Bessette granted MERS, as nominee for Quicken Loans, a mortgage on the property. The mortgage granted MERS and its successors and assigns the right to foreclose the mortgage and have the property sold at a foreclosure sale in the event of an uncured default.

         On November 5, 2011, the mortgage was assigned to Citibank. The Assignment was recorded with the Oakland County Register of Deeds.

         On June 26, 2014, Ms. Bessette passed away. A probate estate was opened in Oakland County Probate Court on September 10, 2015. Glenn Prentice was appointed the personal representative of the estate. On March 7, 2016, the court ordered suspension of the personal representative's fiduciary powers. The powers were subsequently reinstated, with some limitations not relevant here.

         Meanwhile, the mortgage payments fell into default. Therefore, pursuant to the power of sale in the mortgage, Citibank initiated foreclosure proceedings by advertisement pursuant to M.C.L. § 600.3201 et seq. A Notice of Foreclosure was published weekly in the Oakland County Legal News on March 28, April 4, April 11 and April 18, 2016, and on April 3, 2016, the Notice of Foreclosure was posted on the premises. The Sheriff's Sale occurred on June 28, 2016. Citibank purchased the property at the Sheriff's Sale for $153, 000.00. Plaintiff has until December 28, 2016 to redeem the property.

         Meanwhile, on May 6, 2016 -- i.e., prior to the Sheriff's Sale -- Plaintiff commenced this action in Oakland County Circuit Court. Defendants timely removed the action to this Court on May 27, 2016 on diversity of citizenship grounds.

         Plaintiff's Complaint alleges one count to “Compel Judicial Foreclosure.” In support of the claim, Plaintiff alleges that “MCL 600.3101 et seq authorizes [sic] the Court to enjoin non-judicial foreclosure and order that foreclosure be conducted judicially.” [Compl., ¶ 22.] Plaintiff further alleges that “[i]t would be inequitable to permit Defendants to gain from the benefits of a non-judicial foreclosure despite Plaintiff qualifying for a loan modification.” Id., at ¶ 21. However, the Complaint does not contain any facts stating that Doreen Bessette, who has been deceased since June 2014, was qualified for a loan modification prior to the foreclosure sale on June 28, 2016, and Plaintiff does not make any argument concerning any purported loan modification in her Response in opposition to Defendants' Motion to Dismiss.



         As an initial matter the Court will address the issue of its jurisdiction over this matter. As indicated, this case is before this Court on diversity of citizenship grounds. However, one of the named defendants, Defendant Quicken Loans, is a Michigan citizen. As Plaintiff, too, is a Michigan citizen, Defendant Quicken's presence in this action normally would destroy diversity of citizenship and, thereby, preclude this Court from exercising jurisdiction over this matter. However, in their ...

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