William Powell v. Wells Fargo Bank, N.A. and Wells Fargo Home Mortgage (mem. dec.) ( 2019 )

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D), FILED
this Memorandum Decision shall not be Aug 08 2019, 8:16 am
regarded as precedent or cited before any CLERK
court except for the purpose of establishing Indiana Supreme Court
Court of Appeals
and Tax Court
the defense of res judicata, collateral
estoppel, or the law of the case.
APPELLANT PRO SE ATTORNEYS FOR APPELLEES
William Powell Dustin R. DeNeal
Indianapolis, Indiana Elizabeth M. Little
Faegre Baker Daniels LLP
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
William Powell, August 8, 2019
Appellant-Plaintiff, Court of Appeals Case No.
19A-SC-412
v. Appeal from the Marion Small
Claims Court
Wells Fargo Bank, N.A. and The Honorable Brenda A. Roper,
Wells Fargo Home Mortgage, Judge
Appellees-Defendants Trial Court Cause No.
49K01-1810-SC-6782
Crone, Judge.
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Case Summary
[1] William Powell, pro se, appeals the orders of the small claims court denying his
motion for default judgment and granting the motion for judgment on the
complaint filed by Wells Fargo Bank, N.A. and Wells Fargo Home Mortgage
(collectively referred to as “Wells Fargo”). We affirm.
Facts and Procedural History 1
[2] This case was initiated on October 29, 2018, when Powell filed a notice of
claim in the Marion Small Claims Court alleging mortgage fraud. Appellant’s
App. at 247. On November 16, 2018, Wells Fargo filed a motion for a more
definite statement, asserting that Powell’s notice of claim did not clearly
identify the defendants or the bases for his claim. Appellee’s App. at 2-5. On
November 19, 2018, Powell filed an amended notice of claim, naming Wells
Fargo, N.A. and Wells Fargo Home Mortgage as the defendants and alleging
that Wells Fargo Home Mortgage fraudulently prepared loan documents for
Powell by preparing Housing of Urban Development (“HUD”) documents so
that it appeared that his loan was for $45,000 when it was actually for $15,500.
Id. at 8. He further alleged that his loan and mortgage were then sold or
assigned to various other banks, including EMC Mortgage Corporation, that
EMC fraudulently foreclosed on his loan and mortgage, that EMC was
1
Powell inappropriately includes and relies on material in his appellant’s appendix that was not part of the
record below. See Ind. Appellate Rules 2(E) (defining clerk’s record), 2(L) (defining record on appeal), and
50(A) (stating that purpose of appendix is to provide parts of the record on appeal necessary for the Court to
decide issues presented). Accordingly, we will ignore that material.
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acquired by JPMorgan Chase, and that he settled the foreclosure lawsuit with
JPMorgan Chase for $30,000 in 2016. In making these allegations, Powell
referred to exhibits, but the exhibits were not attached to the amended notice of
claim.
[3] Also on November 19, 2018, the court issued an order (“the November 2018
order”) granting Wells Fargo’s motion and ordering Powell to file a more
definite statement. In that order, the court noted that Powell’s amended notice
of claim did not satisfy the requirement for a definite statement because exhibits
were not included in the filing. Appellant’s App. at 14.
[4] On December 7, 2018, Powell filed a response to the November 2018 order,
with exhibits A through P attached, in which he named Wells Fargo, N.A. and
Wells Fargo Home Mortgage as the defendants and alleged that Wells Fargo
Home Mortgage fraudulently prepared his loan by using HUD documents
when Wells Fargo knew that Powell did not have a HUD loan, prepared the
HUD loan documents to make it look like Powell’s $15,000 loan was for
$45,000, and violated HUD regulations by charging loan underwriter fees. Id.
at 17. He alleged that Wells Fargo knew these “statements” were untrue and
intended to deceive him with these statements and that he justifiably relied on
these statements. Id. As a result, he alleged, EMC fraudulently foreclosed on
his note and mortgage and in 2016 he “had to pay $30,000 on a $15,000 loan to
repurchase his home from JPMorgan Chase.” Id. at 15-17. Powell also alleged
that in August 2018, Wells Fargo, N.A. settled a fraud claim with the federal
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government for the abuses of Wells Fargo Home Mortgage and agreed to pay
$500,000,000 in civil penalties for these and other actions. Id. at 18.
[5] The exhibits attached to Powell’s response show that in September 2000, he
borrowed $15,750 with interest charged at a yearly rate of 12.5% from Alliance
Funding, a division of Superior Bank FSB, and that Wells Fargo Home
Mortgage acted as a broker for the loan and prepared the loan documents.
Appellant’s App. at 28, 32, 37, 62. Powell’s loan was secured by a mortgage on
Powell’s Indianapolis property. Id. at 37, 62. Also attached to Powell’s
response is page 2 of the HUD settlement statement for his loan, which
indicates on the first line that the broker’s commission was based on a “price”
of $45,000. Id. at 30. Another attached exhibit is the Truth-In-Lending
disclosure statement, which indicates that the total finance charge of Powell’s
loan was $45,999.40 and that the total dollar amount required to pay off
Powell’s note would be $60,512.40. Id. at 48. In connection with Powell’s loan
of $15,750, Wells Fargo Mortgage received a brokerage fee of $825. Id. at 28,
30.
[6] On December 26, 2018, Powell filed a motion for default judgment based on
Wells Fargo’s failure to file an answer or any other defense. Id. at 8. The
following day, the court issued an order denying Powell’s motion for default
judgment. Id. at 10. On January 18, 2019, Wells Fargo filed a motion for
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judgment on the complaint. 2 On February 4, 2019, the court issued an order
concluding that Powell’s claims were time-barred, granting Wells Fargo’s
motion for judgment on the complaint, and entering final judgment in favor of
Wells Fargo and against Powell on all Powell’s claims. Id. at 11. This appeal
ensued.
Discussion and Decision
Section 1 – The trial court did not err in denying Powell’s
motion for default judgment.
[7] Powell asserts that he was entitled to default judgment because Wells Fargo
failed to file a responsive pleading after he filed his response to the November
2018 order. He presents a question of law that we review de novo. See Miller v.
Danz, 36 N.E.3d 455, 457 (Ind. 2015) (“Interpretation of our Trial Rules is … a
question of law that we review de novo.”). To support his argument, Powell
relies on Indiana Trial Rule 55(A), which provides, “When a party against
whom a judgment for affirmative relief is sought has failed to plead or
otherwise comply with these rules and that fact is made to appear by affidavit or
otherwise, the party may be defaulted by the court.” However, Powell ignores
Indiana Small Claims Rule 4, which states, “All defenses shall be deemed at
issue without responsive pleadings, but this provision shall not alter the burden of
proof.” (Emphasis added.) Thus, in small claims court, a defendant is not
2
This motion is not in the record.
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required to file a responsive pleading, and a defendant’s failure to file a
responsive pleading is not grounds for a default judgment. See Ind. Small
Claims Rule 10(B) (providing that court may enter default judgment when a
defendant fails to appear at the time and place specified in the notice of claims).
Accordingly, the trial court did not err in denying Powell’s motion for default
judgment.
Section 2 – The trial court did not err in granting Wells
Fargo’s motion for judgment on the complaint.
[8] Powell also contends that the trial court erred in granting Wells Fargo’s motion
for judgment on the complaint on the basis that his claim was time-barred. A
motion for judgment on the pleadings should be granted “only where it is clear
from the face of the complaint that under no circumstances could relief be
granted.” KS&E Sports v. Runnels, 72 N.E.3d 892, 898 (Ind. 2017) (quoting
Veolia Water Indianapolis, LLC v. Nat’l Trust Ins. Co., 3 N.E.3d 1, 5 (Ind. 2014)).
We review a trial court’s ruling on a motion for judgment on the pleadings de
novo basing our decision solely on the pleadings and accepting as true the
material facts alleged in the complaint. Id.[9] The statute of limitations for a fraud claim is six years. Ind. Code § 34-11-2-7.
Although the alleged fraud occurred in 2000, Powell claims that Wells Fargo
hid their fraud, and therefore the statute of limitations did not begin running
until he discovered the fraud when he “was watching television in 2018 and
learned that Wells Fargo had agreed to pay a fine and compensation to some of
its recent mortgage customers[,]” and he “took out his mortgage documents
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and found a number of errors in them.” Appellant’s Br. at 5. In support, he
relies on Indiana Code Section 34-11-5-1, which provides, “If a person liable to
an action conceals the fact from the knowledge of the person entitled to bring
the action, the action may be brought at any time within the period of limitation
after the discovery of the cause of action.”
[10] Powell’s amended notice of claim and his response to the November 2018 order
and exhibits attached thereto do not provide any allegations or facts that suggest
that Wells Fargo concealed the HUD settlement statement, in which the
allegedly fraudulent statements were made, from Powell. Rather, when Powell
learned about Wells Fargo’s settlement with the federal government in 2018,
the news prompted him to look at loan documents that were already in his
possession. Accordingly, Section 34-11-5-1 is inapplicable. The statute of
limitations has run on Powell’s fraud claim against Wells Fargo, and therefore
the trial court did not err in finding that his claim was time-barred and in
granting Wells Fargo’s motion for judgment on the complaint.
[11] Affirmed.
Bradford, J., and Tavitas, J., concur.
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