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Quentin R Tezak Irrevocable Living Trust April 11th 2014 v. JPMorgan Chase Bank

United States District Court, D. Arizona

April 9, 2019

Quentin R Tezak Irrevocable Living Trust April 11th 2014, Plaintiff,
v.
JPMorgan Chase Bank, et al., Defendants.

          ORDER

          James A. Teilborg Senior United States District Judge.

         Pending before the Court is Defendant JP Morgan Chase Bank's (“Chase”) Motion to Dismiss (Doc. 7) pursuant to Fed.R.Civ.P. 12(b)(6) for failure to state a claim upon which relief can be granted. The Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 1332, 1441. The Court now rules on this Motion.

         I. FACTUAL BACKGROUND

         On approximately August 29, 2007, Betty Tezak and Q. Robert Tezak (“Q. Tezak”) obtained a loan for $300, 000 from Chase. (Doc. 7-1 at 2). This loan was secured by a Deed of Trust dated August 29, 2007, which was recorded in the official records of Maricopa County, Arizona at Instrument No. 2007-1155926 as a lien against the property at 2340 S. Standage, Mesa, Arizona, 85202-6615 (“Property”). (Doc. 7-1 at 2-11 (copy of the Deed of Trust)).[1] On April 11, 2014, Q. Tezak quitclaimed the Property to the Quentin R. Tezak Irrevocable Trust dated April 9, 2014 (“Trust”). (Doc. 7-1 at 13-14 (Quitclaim Deed)). This Quitclaim Deed was recorded in the official records of Maricopa County, Arizona at Instrument No. 2014-0437583. (Id.).

         Although Q. Tezak passed away on February 23, 2015, (Doc. 7-1 at 16; see 2:18-bk-07636-EPB, Doc. 23-1 at 22), a Chapter 7 bankruptcy case was filed in Q. Tezak's name on June 28, 2018, (Doc. 7 at 2; see 2:18-bk-07636-EPB, Doc. 1). The Bankruptcy Court dismissed the bankruptcy action on July 6, 2018. (Id.; see 2:18-bk-07636-EPB, Doc. 1). On or about July 19, 2018, the trustee under the Deed of Trust, Quality Loan Service Corp. (“Quality Loan”), recorded a Notice of Trustee's Sale. (Doc. 7-1 at 18-20 (Instrument No. 2018-0552397)). Thereafter, on August 13, 2018, Chase moved to re-open the Bankruptcy action to seek in rem relief from the automatic stay so that Chase could proceed with enforcement efforts against the Property. (Doc. 7 at 3; see 2:18-bk-07636, Doc. 23).

         After reinstating the Bankruptcy on September 17, 2018, (Doc. 7 at 3; see 2:18-bk-07636, Doc. 29), the Bankruptcy Court granted Chase in rem stay relief after finding that the filing of the Bankruptcy petition “was part of a scheme to delay, hinder, and defraud Chase in an attempt to prevent Chase from conducting a foreclosure of the real property located at 2340 South Standage, Mesa, Arizona, 85202[, ]” (Doc. 7 at 3; see 2:18-bk-07636, Doc. 38 at 1). The Bankruptcy Court explicitly ordered that Chase could “enforce its valid legal rights and remedies with respect to the Property, including, without limitation, to conduct and complete a foreclosure sale of the Property.” (Doc. 7 at 3; see 2:18-bk-07636, Doc. 38 at 2). On October 24, 2018, Quality Loan sold the Property at a trustee's sale to a third-party. (Docs. 7 at 3; 7-1 at 22-24 (Trustee's Deed Upon Sale, Instrument No. 2018-0827285)).

         II. PROCEDURAL BACKGROUND

         On October 24, 2018, the same day that the trustee's sale was completed, Plaintiff Quentin R Tezak Irrevocable Living Trust (“Plaintiff”) filed a quiet title action by and through Robert J. Tezak, its sole trustee, in Maricopa County Superior Court. (Doc. 1-3 at 3-13). Plaintiff's civil action names two Defendants: Chase, the lender, and Quality Loan, the trustee under the Deed of Trust. (Id. at 3, 8). Chase received a copy of the Summons and Complaint for this civil action on or about October 31, 2018. (Doc. 1 ¶ 3). There is no indication that Defendant Quality Loan has been served.[2] On November 19, 2018, Chase filed a Notice of Removal (Doc. 1), stating that removal is proper under 28 U.SC. § 1332. (Doc. 1 ¶ 4).[3]

         On November 20, 2018, Chase filed a Motion to Dismiss (Doc. 7) (hereinafter, “Motion”) pursuant to Fed.R.Civ.P. 12(b)(6) for failure to state a claim upon which relief can be granted. After the time for responding to this Motion had expired, the Court cautioned Plaintiff in an Order dated December 19, 2018 that if no response was filed by December 28, 2018, the Court would deem the failure to respond to be consent to the Motion to Dismiss being granted pursuant to LRCiv 7.2(i). (Doc. 10). On December 28, 2018, Plaintiff filed a one-page Response to the Motion to Dismiss (Doc. 11), stating only that: “[t]he signatures of Quentin and Betty Tezak are forged[.] [W]e can provide the actual signatures of Quentin and Betty Tezak.” (Doc. 11 at 1). Thereafter, Plaintiff filed an Amended Response to Defendant's Motion to Dismiss (Doc. 13) (hereinafter, “Amended Response”) on January 8, 2019.

         On January 9, 2019, Chase filed a Reply in Support of its Motion to Dismiss (Doc. 12). Then, on January 16, 2019, Chase filed a Motion to Strike Amended Response to Motion to Dismiss, or, in the Alternative, Motion for Leave to File Reply to Amended Response (Doc. 14). In an Order dated January 18, 2019, the Court denied Chase's Motion to Strike Plaintiff's Amended Response, but granted Chase leave to file a Reply to Plaintiff's Amended Response. (Doc. 15 at 3). Defendant filed its Reply to Plaintiff's Amended Response (Doc. 16) on January 25, 2019.

         III. LEGAL STANDARD

         Chase has moved to dismiss Plaintiff's Complaint for failure to state a claim upon which relief can be granted pursuant to Fed.R.Civ.P. 12(b)(6). (Doc. 7). Under Rule 12(b)(6), a motion to dismiss should not be granted “unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claims which would entitle him to relief.” Barnett v. Centoni, 31 F.3d 813, 816 (9th Cir. 1994) (citation omitted). “Dismissal can be based on the lack of a cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1988) (citing Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530, 533-34 (9th Cir. 1984)).

         To survive a Rule 12(b)(6) motion to dismiss, a complaint must meet the requirements of Rule 8. Rule 8(a)(2) requires a “short and plain statement of the claim showing that the pleader is entitled to relief, ” so that the defendant receives “fair notice of what the . . . claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). To meet this standard, a complaint must contain sufficient factual matter, which, if accepted as true, states a claim to relief that is “plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Facial plausibility exists “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. Plausibility does not equal “probability, ” but requires “more than a sheer possibility that a defendant has acted unlawfully.” Id. “Determining whether a complaint states a plausible claim for relief” is “a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Id. at 679.

         When analyzing a complaint for failure to state a claim, “[a]ll factual allegations made by the nonmoving party are taken as true and construed in the light most favorable to that party.” Iolab Corp. v. Seaboard Sur. Co., 15 F.3d 1500, 1504 (9th Cir. 1994) (citation omitted). However, a court need not accept as true legal conclusions couched as factual allegations. Papasan v. Allain, 478 U.S. 265, 286 (1986); Iqbal, 556 U.S. at 678 (“[T]he tenant that a court must accept as true all of the allegations contained in a complaint is ...


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