Asnake v. Deutsche Bank National Trust Company ( 2018 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
DANIEL ASNAKE, et al.,
Plaintiffs,
v. Civil Action No. 18-819 (JEB)
DEUTSCHE BANK NATIONAL TRUST
COMPANY, et al.,
Defendants.
MEMORANDUM OPINION
Pro se Plaintiffs Daniel Asnake and Wacca Merid have lived at 5727 16th Street, N.W.,
here in Washington, for over 23 years. For approximately the last ten of those years, Defendants
Deutsche Bank National Trust Company and Specialized Loan Servicing were the mortgagee
and servicer, respectively, for a mortgage secured by the Property. After Plaintiffs defaulted on
the mortgage, Deutsche Bank commenced foreclosure proceedings against them and, eventually,
obtained court authorization for their eviction. In an attempt to remain in the Property, Plaintiffs
brought this suit claiming that the doctrine of adverse possession protects their rights.
Defendants now move to dismiss on three grounds: standing, failure to state a claim, and claim
preclusion. Finding that Plaintiffs have standing, but do not meet the statutory requirements for
adverse possession, the Court will grant the Motion.
I. Background
As it must at this stage, the Court treats all facts in the pro se Complaint and Opposition
as true. See Graves v. Callahan, 253 F. Supp. 3d 330, 332-33 (D.D.C. 2017). The Court may
also take judicial notice of “public records,” such as deeds and other court proceedings, without
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converting a motion to dismiss into one for summary judgment. See Avila v. CitiMortgage, Inc.,
45 F. Supp. 3d 110, 117 (D.D.C. 2014) (quoting Kaempe v. Myers, 367 F.3d 958, 965 (D.C. Cir.
2004)).
Plaintiffs, husband and wife, have lived at the Property for at least 23 years. See Compl.,
¶¶ 1-2. On January 13, 2006, Asnake conveyed his interest in the Property to Merid, making her
the sole owner. See MTD, Exh. 1 (Asnake Deed). Ten days later, Merid refinanced an existing
mortgage for the amount of $675,000 through a deed of trust. Id., Exh. 2. In 2011, the deed of
trust was assigned to Deutsche Bank. Id., Exh. 3. At some point, Merid defaulted on the loan,
and in 2015, Deutsche Bank appointed substitute trustees to begin foreclosure proceedings in the
Superior Court for the District of Columbia. Id., Exh. 4. In October of that year, the Bank
sought foreclosure by judicial sale pursuant to D.C. Code § 42-816. Id., Exh. 5.
On June 14, 2017 — two years later — the Superior Court granted summary judgment in
favor of Deutsche Bank, accompanied by an order allowing it to proceed with a judicial sale. Id.,Exh. 6. One month later, Merid quitclaimed any “right, title, interest, claim, or demand” that she
may have had in the Property to the Indigenous American Land Trust backdated to October 28,
2015. Id., Exh. 7 (IAL Trust Deed). On August 2, 2107, Deutsche Bank purchased the Property
at a public foreclosure auction. Id., Exh. 8. The Superior Court ratified the sale on November 9,
2017, giving Merid 30 days to appeal. Id., Exh. 9. She did not do so, and the Property was
conveyed to Deutsche Bank on December 14, 2017. Id., Exh. 8.
On March 15, 2018, Plaintiffs filed a claim for adverse possession in Superior Court. On
April 10, Defendants removed the matter to federal court and now move to dismiss.
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II. Legal Standard
Defendants challenge the jurisdiction of this Court to hear the claim as well as the merits,
invoking the legal standards for dismissal under Federal Rules of Civil Procedure 12(b)(1) and
12(b)(6). To survive a motion to dismiss under Rule 12(b)(1), Plaintiffs bear the burden of
proving that the Court has subject-matter jurisdiction to hear their claims. See Lujan v.
Defenders of Wildlife, 504 U.S. 555, 561 (1992); U.S. Ecology, Inc. v. U.S. Dep’t of Interior,
231 F.3d 20, 24 (D.C. Cir. 2000). A court has an “affirmative obligation to ensure that it is
acting within the scope of its jurisdictional authority.” Grand Lodge of the Fraternal Order of
Police v. Ashcroft, 185 F. Supp. 2d 9, 13 (D.D.C. 2001). For this reason, “‘the [p]laintiff’s
factual allegations in the complaint . . . will bear closer scrutiny in resolving a 12(b)(1) motion’
than in resolving a 12(b)(6) motion for failure to state a claim.” Id. at 13-14 (quoting 5A Charles
A. Wright & Arthur R. Miller, Fed. Practice & Procedure § 1350 (2d ed. 1987)) (alteration in
original). Additionally, unlike with a motion to dismiss under Rule 12(b)(6), the Court “may
consider materials outside the pleadings in deciding whether to grant a motion to dismiss for lack
of jurisdiction.” Jerome Stevens Pharms., Inc. v. FDA, 402 F.3d 1249, 1253 (D.C. Cir. 2005);
see also Herbert v. Nat’l Acad. of Sciences, 974 F.2d 192, 197 (D.C. Cir. 1992).
Federal Rule of Civil Procedure 12(b)(6), conversely, provides for the dismissal of an
action where a complaint fails to “state a claim upon which relief can be granted.” Although the
notice-pleading rules are “not meant to impose a great burden upon a plaintiff,” Dura Pharm.,
Inc. v. Broudo, 544 U.S. 336, 347 (2005), and “detailed factual allegations” are not necessary to
withstand a Rule 12(b)(6) motion, Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007), “a
complaint must contain sufficient factual matter, [if] accepted as true, to state a claim to relief
that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation
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marks and citation omitted). The plaintiff must put forth “factual content that allows the court to
draw the reasonable inference that the defendant is liable for the misconduct alleged,” and there
must be “more than a sheer possibility that a defendant has acted unlawfully.” Id.III. Analysis
Defendants argue that this case should be dismissed because Plaintiffs lack standing, do
not meet the requirements for adverse possession, and should be precluded from bringing this
action because the validity of their possession has already been decided. The Court addresses the
first two below and, finding that Plaintiffs have not adversely possessed the Property, declines to
evaluate the third.
A. Standing
In conducting its standing analysis, the Court assumes, as it must, that Plaintiffs are, in
fact, adverse possessors. See In re Navy Chaplaincy, 534 F.3d 756, 760 (D. C. Cir. 2008).
Defendants contend that “[b]oth Plaintiffs conveyed away their ‘interests’ in the Property long
before a 15 year period of adverse possession could accrue” and, consequently, have no standing
to sue. See MTD at 5. While their premise is correct, their conclusion is not. Asnake did,
indeed, convey his interest to Merid in 2006, making her the sole owner. See Asnake Deed.
And, in 2017, Merid conveyed her interest to the IAL trust. See IAL Trust Deed. Defendants
thus claim that “[t]he only party . . . with even theoretical standing to raise a claim is the IAL
trust.” Mot. at 6. Such a conclusion, however, is antithetical to the doctrine of adverse
possession. That doctrine allows a person who occupies, but does not own, real property to
acquire valid title. The entire idea of the doctrine is built on the understanding that the claimant
will not have deed interest in the property, but is nonetheless a possessor. See Auer Park Corp.,
Inc. v. Derynda, 601 N.W.2d 841, 843 (Wis. Ct. App. 1999) (“In an adverse possession, the only
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parties who generally have standing are the property’s titleholder and the party claiming adverse
possession.”); Duleep v. DePaul, 2004 WL 1558260 (Conn. Super. Ct. June 22, 2004) (rejecting
defendants’ contention that plaintiff lacked standing “because she d[id] not have any right, title
and interest” in the property). The Court thus finds that Plaintiffs have standing.
B. Merits
Defendants next maintain that Plaintiffs have not met their burden to demonstrate adverse
possession. Under D.C. law, a party claiming adverse possession must show “actual, open and
notorious, exclusive, continuous, and hostile possession of the premises” for fifteen years. Smith
v. Tippett, 569 A.2d 1186, 1190 (D.C. 1990); see also D.C. Code § 16-1113. If successful, the
adverse possessor gains perfect title to the property. According to Defendants, Plaintiffs “have
failed to allege the requisite hostility” for the statutory time period. See MTD at 4. The Court
agrees.
As the name suggests, adverse possession requires the possessor to be “adverse” to the
actual owner — i.e., “possession that is opposed and antagonistic to all other claims.” Tippett,
569 A.2d at 1190. Plaintiffs here claim adverse possession against Deutsche Bank, which, until
the foreclosure in 2017, was merely the mortgagee. But a mortgagor and mortgagee cannot be
hostile to one another until one party repudiates the relationship, such as if the mortgagor
defaults and the mortgagee forecloses on the property. See Vowell v. Thompson, 3 D.C. 428,
428 (1829) (“[U]ntil actual foreclosure or sale, the mortgagor is, in equity, considered as the
owner of the property.”); see also 3 Am. Jur. § 213 (2d ed. 2018) (“As a general rule, the
possession of a mortgagor or an assignee of the mortgagor cannot be adverse to the rights and
estate of the mortgagee . . .[s]o long as the relation[ship] of mortgagor and mortgagee is
recognized between the parties.”). In other words, the earliest time at which Defendants could
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have been adverse to Plaintiffs is 2017, when the Superior Court approved the foreclosure. Prior
to that time, because “the mortgage conveys nothing in the land,” Defendants were “only
considered as a trustee, and the mortgage [] but a security for the money lent.” Vowell, 3 D.C. at
428; see also Restatement (Third) of Property § 4.1(a) (“A mortgage creates only a security
interests in real estate and confers no right to possession of that real estate on the mortgagee.”).
Because Defendants could not have asserted ownership until one year ago, Plaintiffs cannot
satisfy the 15-year statutory time period for adverse possession.
IV. Conclusion
For the above reasons, the Complaint will be dismissed for failure to state a claim. A
separate Order consistent with this Opinion will be issued this day.
/s/ James E. Boasberg
JAMES E. BOASBERG
United States District Judge
Date: May 14, 2018
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