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Girouard v. Wells Fargo Bank, N.A.

United States District Court, D. Maine

June 12, 2018

WELLS FARGO BANK, N.A., Defendant.


          George Z. Singal United States District Judge.

         Before the Court is Plaintiffs' Motion to Dismiss Counterclaims (ECF No. 30) as to Defendant's Counterclaim Count II, which the Court treats as a Motion for Summary Judgment on Plaintiffs' Third Amended Complaint for Declaratory Relief (ECF No. 27) and Defendant's Counterclaim Count II (see ECF No. 28). For the reasons briefly explained below, the Court GRANTS IN PART the remaining portion of the Motion and enters judgment in favor of Plaintiffs.


         The relevant background for this matter was described by the Maine Supreme Judicial Court, sitting as the Law Court, as follows:

The Girouards own property located in Lewiston. In September 2004, they executed a note and mortgage deed in favor of a third party [Corestar Financial Group, LLC], and after several transactions, all rights created by the instruments were assigned to Wells Fargo. In December 2012, Wells Fargo issued to the Girouards a notice of default and right to cure. See 14 M.R.S. § 6111 (2014). The notice informed the Girouards that, in order to cure the default, they were required to pay $8, 848.81, “plus any additional monthly payments, late charges and other charges that may be due under applicable law after the date of [the] notice and on or before thirty-five (35) days from the date of [their] signed receipt of [the notice].”
When the Girouards failed to cure the default, Wells Fargo purported to accelerate the mortgage, and in July 2013 it initiated [an] action for foreclosure.
More than a year later, on July 14, 2014, shortly after we issued our decision in Bank of Am., N.A. v. Greenleaf, the Girouards moved for summary judgment, arguing that the notice of default did not comply with section 6111 as interpreted in Greenleaf. See 2014 ME 89, ¶¶ 29-31, 96 A.3d 700 (holding that to comply with the statute, a notice of default must state the precise amount that the mortgagor must pay to cure the default, without allowing for accrual of any additional amount during the cure period). Wells Fargo filed a “limited opposition” to the Girouards' motion, agreeing that the demand letter did not meet the requirements of section 6111 and stating that “defendants' Motion for Summary Judgment should be granted for failure to properly accelerate the loan and this matter dismissed without prejudice.” In September 2014, the court granted the Girouards' motion and entered summary judgment for them. In the same order, however, the court also dismissed the foreclosure action without prejudice.
The Girouards then filed three post-judgment motions [and] [t]he court issued an amended order granting the motions in part, concluding that Wells Fargo had not complied with section 6111 as interpreted in Greenleaf because the notice of default did not state the precise amount of the payment needed to cure the default. The court [further] stated that a party's failure to comply with a “statutory requirement” leaves the court without subject matter jurisdiction. On this basis, the court amended its previous order so that summary judgment now was granted “in part” but that the foreclosure action was still “dismissed without prejudice.”
From that amended order, the Girouards filed a timely appeal.

Wells Fargo Bank, N.A. v. Girouard, 123 A.3d 216, 217-18 (Me. 2015) (footnotes omitted).

         Before the Law Court, the Girouards “contend[ed] that the [district] court erred when it dismissed the foreclosure action and ultimately granted only partial summary judgment in their favor.” Girouard, 123 A.3d at 218. After determining that the Girouards had standing to appeal the partial summary judgment, the Court concluded that

because the notice of default issued by Wells Fargo did not meet the applicable requirements of law, the court properly entered summary judgment in favor of the Girouards, but the court erred when it characterized the disposition of the claim as a dismissal. We therefore vacate the court's orders of partial summary judgment and dismissal of the foreclosure action, and we remand to the trial court for reinstatement of the entry of full summary judgment in favor of the Girouards.

Id. at 219. The Law Court, however, declined to opine “about the effect of the summary judgment order on any future action that Wells Fargo might initiate to seek the same relief based on the same rights.” Id. After remand, the state District Court entered full summary judgment for the Girouards on November 19, 2015. (See ECF No. 30-2.)

         In December 2016, the Girouards filed a Complaint in state Superior Court requesting, in relevant part, a declaratory judgment that Wells Fargo has an obligation to discharge the mortgage. (ECF No. 1-2.) The case was removed to this Court and Wells Fargo filed a Motion to Dismiss for failure to state a claim (ECF No. 5). After a series of delays and procedural maneuvers not directly relevant to the matter presently before this Court, the Girouards filed a substantially amended Complaint in early 2018. The current operative Complaint states a single claim for declaratory relief against Wells Fargo seeking a declaratory judgment that, in relevant part, the “note ...

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