*

This decision was originally issued as an “unpublished decision” filed on November 13, 2012.

The court has now designated the opinion as one recommended for full-text publication.

RECOMMENDED FOR FULL-TEXT PUBLICATION

Pursuant to Sixth Circuit I.O.P. 32.1(b)

File Name: 12a0396p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT _________________

JOSEPH J. COYER; JANET M. COYER,

Plaintiffs-Appellants,

v.

HSBC MORTGAGE SERVICES, INC.,

Defendant-Appellee.

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No. 11-2378

Appeal from the United States District Court

for the Eastern District of Michigan at Bay City.

No. 1:10-cv-14339—Thomas L. Ludington, District Judge.

Decided and Filed: November 13, 2012*

Before: MERRITT, MARTIN, and GILMAN, Circuit Judges.

_________________

COUNSEL

ON BRIEF: Francis R. Ortiz, Jennifer L. Newby, DICKINSON WRIGHT PLLC,

Detroit, Michigan, for Appellee. Joseph J. Coyer, Janet M. Coyer, Pinconning,

Michigan, pro se.

_________________

OPINION

_________________

PER CURIAM. Joseph and Janet Coyer, pro se Michigan residents, appeal a

district court order dismissing their civil complaint. 

In 2005, the Coyers entered into a mortgage agreement with Option One

Mortgage Corporation (Option One) for the purchase of property located in Linwood,

Michigan. Later that year, Option One assigned the mortgage to Mortgage Electronic

Registration Systems, Inc. (MERS). Subsequently, HSBC Mortgage Services, Inc.

1
No. 11-2378 Coyer, et al. v. HSBC Page 2

(HSBC) purchased the mortgage from MERS. After the Coyers allegedly stopped

making payment to HSBC in 2010, HSBC began foreclosure proceedings pursuant to the

mortgage contract’s “power of sale” clause. The sale was originally scheduled to occur

in December 2010.

In October 2010, the Coyers filed a complaint asserting numerous allegations

concerning alleged illegal conduct routinely practiced in the mortgage industry. With

respect to HSBC, the Coyers argue that HSBC conspired to induce them into a predatory

loan agreement. Specifically, the Coyers asserted the following claims: (1) breach of

fiduciary duty; (2) negligence/negligence per se; (3) common law fraud; (4) breach of

the implied covenant of good faith and fair dealing; (5) violation of the Truth in Lending

Act (TILA), 15 U.S.C. § 1601 et seq.; and (6) intentional infliction of emotional distress.

The Coyers also filed a motion for preliminary injunction and a motion for a temporary

restraining order seeking to enjoin the sale of their home. HSBC filed a response.

Following a hearing on the motions, a magistrate judge filed a report, recommending that

the district court deny the Coyers a temporary restraining order. The district court

rejected the Coyers’ objections, adopted the magistrate judge’s report, and denied their

motions. The Coyers filed a motion for reconsideration, arguing that Magistrate Judge

Charles Binder should be disqualified from serving as a magistrate judge, pursuant to

28 U.S.C. § 631(c), because he was employed as a faculty member with the United

States Air Force Academy’s Department of Law. The district court denied the motion

for reconsideration as untimely.

HSBC filed a motion to dismiss the complaint. The Coyers filed a response and

HSBC filed a reply. The Coyers also filed a motion to amend their complaint. HSBC

moved for an order removing the Coyers’ common law lien on the property and to enjoin

the Coyers from filing any further liens or encumbrances on the property. 

The district court construed HSBC’s motion to dismiss as a motion for judgment

on the pleadings and granted judgment in favor of HSBC. The district court concluded

that HSBC was entitled to judgment because: (1) a fiduciary duty does not generally

arise within the context of a borrower-lender relationship, and the Coyers failed to allege
No. 11-2378 Coyer, et al. v. HSBC Page 3

special circumstances to override the general rule; (2) the Coyers’ negligence claim is

barred by the applicable three-year statute of limitations and, even if the claim were not

barred, HSBC was not involved in any alleged lack of disclosures between the Coyers

and Option One; (3) the Coyers’ fraud claim also relates to an alleged lack of disclosures

made at the time they entered into their mortgage agreement with Option One, and

HSBC had no involvement with that transaction; (4) Michigan law does not recognize

a claim for breach of the implied covenant of good faith and fair dealing; (5) the Coyers’

TILA claim is barred by the applicable one-year statute of limitation, and even if the

claim is not barred, HSBC had no involvement with the inception of the Coyers’

mortgage with Option One; and (6) the Coyers failed to sufficiently allege a claim for

intentional infliction of emotional distress because they did not present evidence that

HSBC’s actions with respect to the planned foreclosure were so outrageous and extreme

as to go beyond all possible bounds of decency. The district court also granted HSBC’s

motion to remove the Coyers’ common law lien, denied the motion to prohibit the

Coyers from placing further liens on the property, and denied the Coyers’ motion to

amend their complaint. After filing their notice of appeal, the Coyers filed a Federal

Rule of Civil Procedure 60(b) motion, which the district court denied. The Coyers then

filed an amended notice of appeal to include that order.

On appeal, the Coyers reassert their claims that: HSBC breached its fiduciary

duty; HSBC is liable for negligence and negligence per se; HSBC committed common

law fraud; HSBC breached the implied covenant of good faith and fair dealing; and

HSBC violated TILA. The Coyers also argue that the district court erred by failing to:

deny HSBC’s motion to withdraw the Coyers’ common law lien on their property; report

that Magistrate Judge Charles Binder was not qualified to serve as a magistrate judge in

light of his employment with the USAFA; properly scrutinize HSBC’s arguments; grant

their motion to amend their complaint by falsely stating that the Coyers did not submit

a copy of the proposed amended complaint; and properly review their Rule 60(b)

motion.
No. 11-2378 Coyer, et al. v. HSBC Page 4

The Coyers present no arguments on appeal challenging the district court’s

dismissal of their claim for intentional infliction of emotional distress. Therefore, they

have abandoned this claim and we will not review it. See Post v. Bradshaw, 621 F.3d

406, 413–14 (6th Cir. 2010), cert. denied, 131 S. Ct. 2902 (2011); Grace Cmty. Church

v. Lenox Twp., 544 F.3d 609, 618 n.1 (6th Cir. 2008).

We review de novo a district court’s entry of judgment on the pleadings under

Federal Rule of Civil Procedure 12(c). See Sensations, Inc. v. City of Grand Rapids,

526 F.3d 291, 295 (6th Cir. 2008). “For purposes of a motion for judgment on the

pleadings, all well-pleaded material allegations of the pleadings of the opposing party

must be taken as true, and the motion may be granted only if the moving party is

nevertheless clearly entitled to judgment.” Tucker v. Middleburg-Legacy Place,

539 F.3d 545, 549 (6th Cir. 2008) (citation and internal quotation marks omitted). “A

motion brought pursuant to Rule 12(c) is appropriately granted when no material issue

of fact exists and the party making the motion is entitled to judgment as a matter of law.”

Id. (citation and internal quotation marks omitted).

The district court properly dismissed the Coyers’ claim for breach of fiduciary

duty. Under Michigan law, “a fiduciary relationship arises from the reposing of faith,

confidence, and trust and the reliance of one on the judgment and advice of another.”

See Teadt v. Lutheran Church Mo. Synod, 603 N.W.2d 816, 823 (Mich. Ct. App. 1999).

However, there is generally no fiduciary relationship between a mortgagor and a

mortgagee. In re Sallee, 286 F.3d 878, 893 (6th Cir. 2002). Here, HSBC purchased the

Coyers’ mortgage and serviced the mortgage, but the Coyers have not shown that any

special circumstances exist to avoid the general rule that such a relationship does not

involve fiduciary duties.

The district court also properly dismissed the Coyers’ claim for breach of an

implied covenant of good faith and fair dealing because “Michigan does not recognize

a claim for breach of an implied covenant of good faith and fair dealing . . . .” See Belle

Isle Grill Corp. v. City of Detroit, 666 N.W.2d 271, 279 (Mich. Ct. App. 2003).
No. 11-2378 Coyer, et al. v. HSBC Page 5

The district court properly dismissed the Coyers’ negligence and fraud claims.

“Under Michigan law, a plaintiff alleging a claim of negligence must demonstrate the

following four elements: 1) a duty owed to the plaintiff by the defendant, 2) breach of

that duty, 3) causation, and 4) damages.” Brown v. United States, 583 F.3d 916, 920

(6th Cir. 2009) (citing Case v. Consumers Power Co., 615 N.W.2d 17, 20 (Mich. 2000)).

In order to establish a fraud claim, a plaintiff must demonstrate that: “(1) the defendant

made a material representation; (2) the representation was false; (3) when the defendant

made the representation, the defendant knew that it was false, or made it recklessly,

without any knowledge of its truth as a positive assertion; (4) the defendant made the

representation with the intention that the plaintiff would act upon it; (5) the plaintiff

acted in reliance upon it; and (6) the plaintiff suffered damage.” Bennett v. MIS Corp.,

607 F.3d 1076, 1100–01 (6th Cir. 2010) (citing Cummins v. Robinson Twp., 770 N.W.2d

421, 435 (Mich. Ct. App. 2009)).

The Coyers’ allegations concerning negligence and fraud relate to statements and

misrepresentations made at the time that they entered their mortgage with Option One.

However, it is undisputed that HSBC was not a party to that transaction, and that HSBC

purchased the mortgage on the secondary market. Therefore, HSBC was not involved

in any alleged lack of disclosures between the Coyers and Option One. Although the

Coyers now argue that HSBC is liable for the misrepresentations and failures to disclose

information made by Option One and its agents, they have presented no persuasive

authority to support this contention. The Coyers argue that HSBC is subject to its claims

against Option One by virtue of 16 C.F.R. § 433.2. However, that provision does not

apply to mortgages. See Johnson v. Long Beach Mortgage Loan Trust 2001-4, 451 F.

Supp. 2d 16, 55 (D.D.C. 2006).

Even if the Coyers had stated a negligence claim, that claim is barred by the

applicable three-year statute of limitations. See Mich. Comp. Laws § 600.5805. The

Coyers’ claims stem from their allegations that they were not fully made aware of the

terms of their mortgage loan when they agreed to the loan in June 2005. However, they
No. 11-2378 Coyer, et al. v. HSBC Page 6

did not file their complaint until October 28, 2010, approximately two years beyond the

limitations period.

The district court properly dismissed the Coyers’ claims under TILA. “TILA

requires that creditors make certain disclosures as to the terms of lending arrangements

and provides for civil liability for failure to comply with its provisions.” United States

v. Petroff-Kline, 557 F.3d 285, 294 (6th Cir. 2009) (citing 15 U.S.C. § 1640). The

Coyers failed to allege facts indicating how HSBC violated TILA. As stated above, the

Coyers’ allegations that they were induced to enter into a predatory loan agreement via

misrepresentation and fraud relates back to the time they entered their mortgage with

Option One, and HSBC was not a party to that transaction. Moreover, any claim under

TILA is barred by the applicable one-year statute of limitations. See 15 U.S.C.

§ 1640(e); MacDermid v. Discover Fin. Servs., 488 F.3d 721, 734 n.3 (6th Cir. 2007).

Although the Coyers signed the loan in 2005, they waited until 2010 to file their

complaint challenging the alleged failures to disclose information about the pertinent

terms of the loan. The Coyers argue that their claim did not accrue until they had read

a book entitled “Truth in Lending” and a document entitled “Truth-In-Lending

Disclosure Requirements, Violations, and Remedies.” However, a version of “Truth in

Lending” has been available since 1986, and the book is currently in its seventh edition.

The “Truth-In-Lending Disclosure Requirements, Violations, and Remedies” document

was written in 2007. The Coyers’ cause of action would have accrued no later than

2007, and the limitations period would have expired in 2008. Therefore, the Coyers’

2010 complaint is untimely.

The Coyers’ remaining appellate arguments do not entitle them to relief. The

district court properly granted HSBC’s motion to remove the Coyers’ common law lien

on their property because an individual cannot place a lien on his or her own property.

See Gould v. Day, 94 U.S. 405, 413 (1876) (noting that “[o]ne cannot have a lien upon

his own property”). Therefore, the Coyers’ lien is void. Second, the Coyers argue that

the district court’s rulings are void because the district court did not address their

argument that Magistrate Judge Charles Binder was not qualified to serve as a magistrate
No. 11-2378 Coyer, et al. v. HSBC Page 7

judge pursuant to 28 U.S.C. § 631(c). Section 631(c) provides that “[a] magistrate judge

may hold no other civil or military office or employment under the United States: . . . .”

However, even assuming that Magistrate Judge Binder was unqualified for service

because of other employment, the district court’s orders are not void because that court

withdrew the reference to the Magistrate Judge and conducted a de novo review before

dismissing the Coyers’ complaint. Moreover, the district court properly declined to rule

on this argument because it was first made in an untimely motion for reconsideration.

The Coyers’ suggestions that Judge Ludington is biased are meritless. 

The record belies the Coyers’ claim that the district court did not “properly

scrutinize” HSBC’s arguments. As stated above, the district court conducted a de novo

review of the Coyers’ claims and HSBC’s responses to those claims. In addition,

although the Coyers argue that the district court determined, without any evidence, that

HSBC had an interest in the mortgage, the Coyers themselves submitted papers

documenting that Option One had assigned the mortgage to MERS, and that MERS had

assigned its interest to HSBC. The Coyers’ claim that the district court “falsely” stated

that they did not submit a copy of their proposed amended complaint is also belied by

the record. The district court docket sheet reflects that the Coyers submitted only a

motion for leave to amend, but did not attach a copy of the proposed amended complaint.

Finally, the district court properly denied the Coyers’s Rule 60(b) motion. We

review a district court’s denial of a Rule 60(b) motion for an abuse of discretion.

Thompson v. Bell, 580 F.3d 423, 442 (6th Cir. 2009). “‘Abuse of discretion is defined

as a definite and firm conviction that the trial court committed a clear error of

judgment.’” Id. (quoting Burrell v. Henderson, 434 F.3d 826, 831 (6th Cir. 2006)). In

denying the Rule 60(b) motion, the district court noted that the Coyers had advanced

“new legal and factual arguments” that were not previously included as part of their six

enumerated causes of action against HSBC, and declined to address any new claims.

The Coyers argue that the district court erred because it failed to rule on the entirety of

their Rule 60(b) motion because Rule 60(b) provides for relief based on newly

discovered evidence. See Fed. R. Civ. P. 60(b)(2). However, a motion for
No. 11-2378 Coyer, et al. v. HSBC Page 8

reconsideration under Rule 60(b) is not the proper vehicle for asserting new claims. See

Dean v. City of Bay City, Mich., 239 F. App’x 107, 111 (6th Cir. 2007).

The district court’s order is affirmed.