IN	THE	UNITED	STATES	DISTRICT	COURT	FOR	THE

SOUTHERN	DISTRICT	OF	ALABAMA

SOUTHERN	DIVISION

GEORGE	P.	SHEDD,	JR.,	et	

al.,

Plaintiffs.

v.

WELLS	FARGO	HOME	

MORTGAGE,	INC.,	et	al.,

Defendants.

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CIVIL	ACTION	NO.

14-00275-CB-M

AMENDED	ORDER

Defendant	Barclays	Capital	Real	Estate,	Inc.	has	filed	a	Motion	to	Dismiss	the	

First	Amended	Complaint	for	failure	to	state	a	claim	upon	which	relief	can	be	

granted,	along	with	a	supporting	brief.		(Docs.	20	& 21.)		Plaintiffs	have	filed	a	brief	

in	response	wherein	they	agree	that	some	of	the	claims	asserted	against	this	

Defendant	are	subject	to	dismissal	but	argue	that	the	remaining	claims	are	not.		

Procedural	Background

On	May	9,	2014,	Plaintiffs	George	P.	Shedd,	Jr.	and	Pamela	J.	Shedd	(“the	

Shedds”)	filed	a	complaint	in	the	Circuit	Court	of	Mobile,	Alabama	against	

defendants	Wells	Fargo Home	Mortgage,	Inc. (“Wells	Fargo”),	Monument	Street	

Funding,	II,	LLC	(“Monument”),	and	Barclays	Capital	Real	Estate,	Inc.	(“Barclays”).		

The	complaint	asserted sought	various	state	law	causes	of	action	and	ought	

damages	and	injunctive	relief	against	the	Defendants	in	connection	with	the	Shedds	

home	mortgage	on	property	located	in	Mobile,	Alabama.		The	Defendants	removed	

the action	to	this	Court	asserting	removal	jurisdiction	based	on	diversity	of	

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citizenship.	Shortly	after	removal	all	Defendants	filed	motions	to	dismiss	the	

complaint.		Plaintiffs	responded	with	an	amended	complaint,	which	expanded	the	

factual	allegations	and added	several	causes	of	action.		Defendants’	renewed	

motions	to	dismiss	followed.

The	Amended	Complaint

The	First	Amended	Complaint	(“the	Amended	Complaint”) is	based	on	events	

related	to	the	servicing	of	the	Shedds	mortgage	by	the	Defendants.		In	2001,	the	

Shedds	signed	a	promissory	note	and	executed	a	mortgage,	secured	by	the	residence

in	Mobile,	Alabama,	to	The	Mortgage	Outlet.		Barclays	serviced	the	loan	pursuant	to	

a	contract	with	The	Mortgage	Company.		Barclays	continued	to	service	the	loan	after	

the	loan	and	mortgage	were	assigned	to	Monument,	which	is	owned	by	Wells	Fargo,

in 2007.		In	2008,	the	Shedds	filed	a	Chapter	11	plan	of	reorganization	in	the	United	

States	Bankruptcy	Court	for	the	Southern	District	of	Alabama.		Barclays,	the	loan	

servicer,	represented	to	the	bankruptcy	court	that	it	was	the	creditor	and	sought	a	

relief	from	the	automatic	stay.			In	an	order	dated	April	25,	2008,	the	bankruptcy	

court	“noted	that	Barclays	and	Plaintiffs	had	entered	into	an	adequate	protection	

agreement”	and	that	“Plaintiffs	would	pay	Barclays	their	regular	mortgage	payment	

plus	an	additional	$306.62	monthly,	beginning	with	the	April	2008	payment,	and	

‘upon	confirmation	of	the	Plan	of	Reorganization,	the	terms	of	the	confirmed	plan	

shall	control,’	including	‘the additional	payment	to	be	made	HomeEq	for	purposes	of	

paying	out	the	pre-petition	arrearage	and	charges.’”		(Am.	Compl.	¶	7,	Doc	17.)		The	

bankruptcy	court	ultimately	confirmed	the	reorganization	plan,	which	required	the	

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Shedds	to	pay	the	additional	$306.62	for	60	months	to	satisfy	the	pre-petition	

arrearage	of	$16,500	in	full.		

The	Shedds	began	paying	the	$306.62	as	required,	and	continued	to	do	so,	

but	Barclays	(and	Monument)	failed	to	apply	the	payments	to	the	pre-petition	

arrearage	as	agreed.		In	September	2008,	Barclays	notified	the	Shedds	the	loan	was	

in	default,	accelerated	the	debt	and	scheduled	a	foreclosure.		“Throughout	2009	and	

in	2010	.	.	.	Barclays	continued	to	.	.	.	wrongfully	initiat[e]	foreclosure	proceedings;	

misallocate[e]	payments	[or	refuse]	payments	.	.	.	fail[	]	to	properly	credit	mortgage	

interest,		[incorrectly]	report[ed]	Plaintiffs	to	credit	reporting	agencies	as	

delinquent.		(Id. ¶	9(M).)	 Also,	in	2009	and	in	2010,	“Barclays	.	.	.		wrongfully	

disburs[ed]	$3,576.3	for	‘hazard	insurance’	to	unknown	third	parties,	in	violation	of	

[the	loan	agreement]	and	fail[ed]	to	notify	Plaintiffs”	that	it	had	done	so.		(Id. ¶	

9(N).)

In	September	2010,	Wells	Fargo	took	over	as	servicing	agent	for	Monument,	

but	the	same	problems	continued.		The	loan	was	placed	in	foreclosure,	payments	

were	misapplied,	the	Shedds	were	reported	delinquent	to	credit	reporting	agencies,	

mortgage	interest	was	underreported	on	IRS	Form	1098	for	tax	years	2010-13.		In	

addition,	Wells	Fargo	“force-placed	insurance	.	.	.	each	year”	even	though	the	Shedds	

already	had	hazard	insurance	and	had	notified	Wells	Fargo	of	that	fact. (¶	17(F).)		

Based	on	these	facts,	the	Shedds	have	asserted	the	following	claims:

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Count Cause	of	Action Defendants

One Breach	of	Contract All

Two Breach	Covenant of	Good	

Faith/Fair	Dealing

All

Three Breach	of	Fiduciary	Duty All

Four Negligence All

Five Wantonness Wells	Fargo	&	Monument

Six Fraud All

Seven Promissory	Fraud All

Eight Fraudulent	

Suppression/Concealment

All

Nine Unconscionability All

Ten Unjust	Enrichment All

Eleven Conversion All

Twelve Injunctive	Relief All

Thirteen Real	Estate	Settlement	

Procedures	Act,	12	U.S.C.	§	

2601	(RESPA)	violation	

(Escrow	Payments)

Wells	Fargo	&	Monument

Fourteen RESPA	violation	(Error	

Resolution/Info	Requests)

Wells	Fargo	&	Monument

Fifteen RESPA	violation	(ForcePlaced	Hazard	Insurance)Wells	Fargo	&	Monument

Sixteen Truth	in	Lending	Act	,	15	

U.S.C.	§	1601	(TILA)	&	

Regulation	Z	violation	

(Payment	Crediting)

Wells	Fargo	&	Monument

Seventeen TILA/Regulation	Z	

violation	(Periodic	

Statements)

Wells	Fargo	&	Monument

Eighteen RESPA	Violation	(Loss	

Mitigation)

Wells	Fargo	&	Monument

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Issues	Raised

Barclays	has	moved	to	dismiss	all	claims	against	it	for	failure	to	state	a	claim	

pursuant	to	Rule	12(b)(6)	of	the	Federal	Rules	of	Civil	Procedure.		Some	of	the	

issues	raised	in	Barclays’	motion	to	dismiss	have	been	resolved	by	Plaintiffs’	

response.		They	agree	that	several	of	their	claims	against	Barclays	are	barred	by	the	

statute	of	limitations.		Thus,	Plaintiffs’	claims	against	Barclays	for	breach	of	fiduciary	

duty (Count	Three),	negligence (Count	Four),	fraud	(Count	Six), and	promissory

fraud	(Count	Seven)	are	due	to	be dismissed	on	statute	of	limitations	grounds.		The	

Court	need	not	address	the	alternative	grounds	for	dismissal	asserted	by	Barclays	

with	respect	to	those	counts.		Below,	the	Court	sets	forth the	applicable	standard	of	

review	before	addressing	each	of	the	remaining claims.

Standard	of	Review

A	complaint	must	“set	forth	a	short	and	plain	statement	of	the	claim	showing	

that	the	pleader	is	entitled	to	relief.”		Fed.	R.	Civ.	P.	8(a)(2).		In	Bell	Atlantic	Corp.	v.	

Twombly,	550	U.S.	544	(2007),	the	Supreme	Court set	forth	the	parameters	of	a	wellpleaded	complaint.		A	claim	for	relief	“must	set	forth	enough	factual	matter	(taken	as	

true)	to	suggest	[the	required	elements	of	a	cause	of	action].”			Id. at	556;	see	also	

Watts	v.	Florida	Int’l	University,	495	F.3d	1289,	1295	(11th	Cir.	2007)	(applying	

Twombly).			Furthermore,	a	complaint	must	“provide	the	defendant	with	fair	notice	

of	the	factual	grounds	on	which	the	complaint	rests.”		Jackson	v.	Bellsouth	

Telecommc’ns,	Inc.,	372	F.3d	1250,	1271	(11th	Cir.	2004).			

In	Ashcroft	v.	Iqbal,	556	U.S.	662,	129	S.Ct.	1937	(2009),	the	Supreme	Court	

further	refined	the	threshold	requirements	for	a	claim	under	Rule	8(a)(2).			

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Two	working	principles	underlie	our	decision	in	Twombly.	First,	the	

tenet	that	a	court	must	accept	as true	all	of	the	allegations	contained	

in	a	complaint	is	inapplicable	to	legal	conclusions.	Threadbare	recitals	

of	the	elements	of	a	cause	of	action,	supported	by	mere	conclusory	

statements,	do	not	suffice.		Rule	8	marks	a	notable	and	generous	

departure	from	the	hyper-technical,	code-pleading	regime	of	a	prior	

era,	but	it	does	not	unlock	the	doors	of	discovery	for	a	plaintiff	armed	

with	nothing	more	than	conclusions.	Second,	only	a	complaint	that	

states	a	plausible	claim	for	relief	survives	a	motion	to	dismiss.	

Determining	whether	a	complaint	states	a	plausible	claim	for	relief	

will	.	.	.	be	a	context-specific	task	that	requires	the	reviewing	court	to	

draw	on	its	judicial	experience	and	common	sense.	But	where	the	

well-pleaded	facts	do	not	permit	the	court	to	infer	more	than	the	mere	

possibility	of	misconduct,	the	complaint	has	alleged-but	it	has	not	

“show[n]”-“that	the	pleader	is	entitled	to	relief.”	

Iqbal,	129	S.Ct.	at	1949-50	(quoting	Fed.	R.	Civ.	P.	8(a)(2))	(other	citations	omitted).		

“When	considering	a	motion	to	dismiss,	all	facts	set	forth	in	the	plainitff’s	

complaint	‘are	to	be	accepted	as	true.”		Grossman	v.	Nationsbank,	N.A.,	225	F.3d	

1228,	1232	(11th Cir.	2000)(per	curiam).		Conclusory	allegations,	however,	are	not.		

“A district	court	considering	a	motion	to	dismiss	shall	begin	by	identifying	

conclusory	allegations	that	are	not	entitled	to	an	assumption	of	truth—legal	

conclusions	must	be	supported	by	factual	allegations.”		Randall, 610	F.	3d	at	709-10.			

Next,	the	court	“should	assume,	on	a	case-by-case	basis,	that	well	pleaded	factual	

allegations	are	true	and	then	determine	whether	they	plausibly	give	rise	to	an	

entitlement	to	relief.”		Id.	at	710.		Plausibility	means	something	more	than	

allegations	that	are	“merely	consistent	with”	liability.		Iqbal,	129	S.Ct.	at	1949.		The	

facts	alleged	must	“allow[	]	the	court	to	draw	the	reasonable	inference	that	the	

defendant	is	liable	for	the	misconduct	alleged.”		Id.		

Legal	Analysis

Breach	of	Contract	(Count	One)

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Barclays	argues	that	this	count	is	due	to	be	dismissed	for	three	reasons:		(1)	

the	complaint	fails	to	identify	a	contract	between	these	parties	and/or	any	specific	

contractual	provision	that	was	breached;	(2)	Plaintiffs	have	failed	to	support	a	

breach	of	contract	claim	based	on	a	third-party	beneficiary	theory; and	(3)	at	least	a	

portion	of	the	breach	of	contract	claim	is	barred	by	the	Statute	of	Frauds.		In	

response to	the	first	argument,	Plaintiffs	point	to	allegations	in	the	Amended	

Complaint	that	Barclays	represented	itself	in	bankruptcy	court	as	a	secured	creditor	

and	reached	an	agreement	with	Plaintiffs,	confirmed	by	the	bankruptcy	court,	to	

accept	$306.62	over	60	months	in	payment	of	Plaintiffs’	arrearages.		Then,	

according	to	Plaintiffs,	Barclays	violated	that	agreement	by,	inter	alia, failing	to	

properly	allocate	those	payments.		These	allegations	are	sufficient	to	state	a	breach	

of	contract	claim	based	on	the	Chapter	11	reorganization	plan.		See	Paul	v.	Monts,	

906	F.2d	1468	(10th Cir.	1990)	(per	curiam)	(recognizing	state	law	cause	of action	

for	breach	of	contract	based	on	confirmed	bankruptcy	reorganization	plan);	see	also	

In	re	Arts	Dairy,	LLC, 432	B.R.	712,	716 (Bankr.	N.D.	Ohio	2010)(confirmed	plan	of	

reorganization	operates	as	a	new	and	binding	contract	between	debtor	and	

creditors);	cf.	In	re	Shenago	Group,	501	F.3d	338,	344	(3d	Cir.	2007)	(“In	construing	

confirmed	plan	of	reorganization,	we	apply	contract	principles.”).		

The	next	issue	raised	by	Barclays	is	Plaintiffs’	claim that	they	“were	a	third	

party	intended	beneficiary	of Barclays’	servicing	contract	with	Monument.”		(Am.	

Compl.		¶	23(A).) 1		Barclays	argues	that	Plaintiffs	have	failed	to	allege	facts	to	

support	a	breach	of	contract	claim	based	on	a	third-party	beneficiary	theory.	

																																																							 1 The	Amended	Complaint	does	not	state	specifically	how	Barclays	breached	

its	loan	servicing	contract	with	Monument.

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Plaintiffs	respond	that	“discovery	will	reveal	both	the	arrangement	between	

Barclays	and	Monument	and	the	surrounding	circumstances	related	to	it.”		(Pls.’	

Rsp.	10,	Doc.	23.)			As	both	parties	recognize,	under	Alabama	law	it	is	well-settled	

that	“[a]	party	claiming	to	be	a	third-party beneficiary, must	establish	that	the	

contracting	parties	intended,	upon	execution	of	the	contract,	to	bestow	a	direct, as	

opposed	to	an	incidental, benefit	upon	the	third	party.”		Cincinnati	Ins.	Cos.	v.	Barber	

Insulation,	Inc.,	946	So.2d	441,	443	(Ala.	2006)	(internal	quotation	marks	omitted). 		

Plaintiffs’	bare	allegation	that	they	are	third-party	intended	beneficiaries	of	the	

Monument/Barclays	servicing	contract	is	precisely	the	type	of	factually	

unsupported	legal	conclusion	that	Iqbal	 and	Twombley prohibit.

Barclays’	final	argument,	quite	possibly,	is	a	non-issue.		It	relates	to	an	

allegation	in	the	Amended	Complaint	that	“Barclays,	through	its	counsel,	also	

promised	that	Plaintiffs	would	be	deemed	current	on	the	loan.”		(Am.	Compl.	¶	12.)	

Barclays	argues	that	this	amounts	to	an	oral	agreement	to	forebear	repayment	of	

the	loan	and,	as	such,	is	barred	by	the	Statute	of	Frauds,	Ala.	Code	§	8-9-2(7)	(1975),	

which	requires	that	every	agreement	to	delay	or	forbear	repayment	of	money	must	

be	in	writing.	 Plaintiffs	counter that	the	statement	is	not	an	agreement	to	forbear	

repayment	but	a	promise	to	show	the	loan	as	current,	i.e.,	not	in	default.		

Furthermore,	the	Court	does	not	read	the	Amended	Complaint	to	assert	a	breach	of	

contract	claim	based	on	this	statement. Even	assuming	that	it	does,	the	Court	finds

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that	the	statement	is	susceptible	to	multiple	interpretations2 and	declines	to	apply

the	Statute	of	Frauds	at	this	stage.		

In	summary,	the	Amended	Complaint	sets	forth	a	viable	breach	of	contract

claim	based	on	Barclays’ alleged	breach	of	the	bankruptcy	reorganization	plan.		It	

does	not	state	a	viable	breach	of	contract	claim	based	on	a	third-party	beneficiary	

theory.		Finally,	the	Court	rejects	Barclays’	argument	for	dismissal	based	on	the	

Statute	of	Frauds.

Breach	of	the	Duty	of	Good	Faith	and	Fair	Dealing	(Count	Two)

Barclays	interprets	this	claim	to	be	a	claim	for	the	tort	of	bad	faith	and	argues	

that	it	is	barred	by	the	two-year	statute	of	limitations	applicable	to	torts	and	

because	Alabama	has	recognized	the	tort	of	bad	faith	only	in	relation	to	insurance	

contracts.	 In	response,	Plaintiffs	argue	that	their	claim	for	breach	of	the	duty	of	

good	faith	and	fair	dealing	sounds	in	contract.		The	Alabama	Supreme	Court	has	

recognized	a	bad	faith	claim	under	contract	law	for	violation	of	a	contract’s	express	

or	implied	obligation	of	good	faith.		See	Lake	Martin/	Alabama	Power	Licensee	Assoc.,	

Inc.	v.	Alabama	Power	Co.,	Inc., 601	So.	2d	942,	944	(Ala.	1992).		Therefore,	Barclays’	

asserted	grounds	for	dismissal	are	inapplicable.3		

Fraudulent	Suppression/Concealment (Count	Eight)

Barclays	argues	that	Plaintiff’s	fraudulent	suppression	claim	fails	because	

“Plaintiffs	have	failed	to	allege	that	Barclays	had	a	duty	to	disclose,	and	have	failed	

																																																							 2 In	the	context	of	these	facts,	a	promise	to	deem	the	loan	current	could	also	

be	a	promise	to	correct	the	errors	that	placed	the	loan	in	default	or,	alternatively,	as	

an	admission	that	the	loan	was	erroneously	placed	in	default.

3Because	Barclays	has	misinterpreted	the	claim,	it	has	not	challenged	the	

sufficiency	of	Plaintiffs’	contractual breach	of	the	duty	of	good	faith	and	fair	dealing.		

The	Court	will	not	address	a	potential	basis	for	dismissal	that	has	not	been	raised.

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to	present	any	proof	or	argument	as	to	the	source	of	Barclays’	duty	to	disclose.”		

(Barclays’	Br.	23,	Doc.	21.)		Plaintiffs	acknowledge	that	the	Count	Eight	does	not	

specifically	allege	that	Barclays	had	a	duty	to	disclose,	thought	they	contend	that	

this	is	a	typographical error	and	that	“[t]he	intent,	as	can	be	gleaned	throughout	this	

count	is	to	assert	the	obvious—that	all	Defendants	owed	a	duty	to	Plaintiffs.”		(Pls.’	

Br.	18-19.)		Even	assuming,	arguendo,	that	Plaintiffs	have	pled	the	legal	element,	i.e.,	

that	Barclays	had	a	duty to	disclose,	they	have	failed	to	allege	facts	to	support	that	

claim.		

Alabama	law	defines	fraudulent	suppression	as	“’[s]uppression	of	a	material	

fact	which	the	party	is	under	an	obligation	to	communicate.	The	obligation	to	

communicate	may	arise	from	the	confidential	relations	of	the	parties	or	from	the	

particular	circumstances	of	the	case.’”		State	Farm	&	Cas.	Co.	v.	Owen,	729	So.2d	834,	

837	(Ala.	1998)	(quoting	Ala.	Code	§	6-5-102	(1975)).	 In	this	case,	the	“material	

fact”	allegedly	suppressed	by	Barclays	was	its	“wrongful	sharing	in	a	commission,	

payment	kickback,	fee	or	financial	benefit	when	it	force-placed	insurance	on	

Plaintiffs’	property.”		(Pls.’	Br.	18.)		Plaintiffs	contend	that	“special	circumstances”	

include	Barclays’	involvement	in	the	Chapter	11	plan	and Barclays’	failure	to	comply	

with	the	Chapter	11	agreement	by	force-placing	hazard	insurance.		These	alleged	

“special	circumstances”	are	not	specifically	asserted	in	Count	Eight,	but	even	if	they	

were	they	would	not	support	a	legal	determination	that	Barclays	had	a	duty	to	

disclose.		Whether	special	circumstances	exist	that	give	rise	to	a	duty	to	disclose	

exists	is	a	question	of	law.		Owen,	729	So.2d	at	839.		Plaintiffs	allege	nothing	more	

than	the	existence	of	a	contract	(the	Chapter	11	plan)	and	Barclays	alleged	breach	of	

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that	contract	(force-placing	hazard	insurance).			These	are	not	“special	

circumstances”	that	would	impose	on	Barclays	a	duty	to	disclose.	 “When	both	

parties	are	intelligent	and	fully	capable	of	taking	care	of	themselves	and	dealing	at	

arm’s	length,	with	no	confidential	relationship,	no	duty	to	disclose	exists	when	

information	is	not	requested,	and	mere	silence	is	not	a	fraud.”		Bank	of	Red	Bay	v.	

King,	482	So.2d	274,	285-86	(Ala.	1985);	see	also	Surrett	v.	TIG	Premier	Ins.	Co.,	869	

F.Supp.	919,	924-25	(M.D.	Ala.	1994)	(superior	knowledge	does	not	amount	to	

special	circumstances	imposing	a duty	to	disclose); Owens,	729	So.2d	at	843	

(relationship	between	insurer	and	insured	not	“special	circumstance”); Mason	v.	

Chrysler	Corp.,	653	So.2d	951, 954-55	(Ala.	1995)	(dealership’s	knowledge	of	

recurring	defect	automobile	model	purchased	by	customer did	not	give	rise	to	duty	

to	disclose).

Unconscionability	(Count	Nine)

Barclays	argues	that	no	such	cause	of	action	exists,	and	Plaintiffs	agree	“that	

the	affirmative	cause	of	action	for	unconscionability	does	not	allow	for	money	

damages.”		(Pls.’	Br.	20.)		They	argue,	however,	that	the	Court	may	prevent	an	

unconscionable	result.		Plaintiffs’	argument	is	unavailing.		A	more	accurate	

statement	of	the	law	is	that		“a	court	may	rescind	a	contract,	or	a	portion	of	a	

contract,	for	unconscionability.”		Layne	v.	Garner,	612	So.	2d	404,	408	(Ala.	1992).		

However,	Plaintiffs	do	not	seek	rescission	of	the	contract	or	a	portion	thereof.		Other	

than	damages,	the	only	relief	they	seek	is	“cancellation	of	any	remaining	debt”	(i.e.,	

to	be	relieved	of	their	duty	to	perform).		Moreover,	they	do	not	claim	that	the	

contract was	unconscionable.		Instead,	they	allege that	the	Barclays	(and	the	other	

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Defendants) behaved	unconscionably	by	failing	to	comply	with	post-contractual	

promises	and	by	failing	to	perform	obligations	under	the	contract.		(Am.	Compl.	¶	

49.)		In	sum,	Count	Nine	fails	to	state	a	claim for	relief	of	any	kind.

Unjust	Enrichment	(Count	Ten)

Barclays	asserts	two	grounds	for	dismissal	of	Plaintiffs’	unjust	enrichment	

claim.		First,	Defendant	contends	that	the	claim	is	preempted	by	the	existence	of	an	

express contract.	“[U]njust enrichment	is	an	equitable	remedy	only	to	be	invoked	

when	there	is	no	available	remedy	at	law.”		Northern	Assur.	Co.	of	Am. v.	Bayside	

Marine	Constr.,	Inc.,	2009	WL	151023	(S.D.	Ala.	Jan.	21,	2009);	see	also	American	

Family	Care,	Inc.	v.	Irwin,	571	So.2d	1053,	1061	(Ala.	1990)	(“Equity	is	a	system	of	

remedies	that	evolved	to	redress	wrongs	that	were	not	recognized	by	or	adequately	

righted	by	the	common	law.”)		Thus,	it	is	true	that	breach	of	contract	and	unjust	

enrichment are mutually	exclusive	when	both	claims	are	based	on	the	same	set	of	

facts.		See	White	v.	Microsoft	Corp,	454 F.Supp.2d	1118,	1133-34	(S.D.	Ala.	2006)	

(granting	summary	judgment	on	unjust	enrichment	claim	where	plaintiff	also	

sought	recovery	on	express	warranty).		Nevertheless,	alternative theories	of	

recovery	may	be	presented	to,	and	decided	by,	the	trier	of	fact.		Kennedy	v. PolarBEK	Baker	Wildwood	P’ship,	682	So.2d	443	(Ala.	1996)	(trial	court	properly	

submitted	alternative	theories	of	breach	of	contract	and	implied	contract	to	jury).		

Dismissal	is	not	appropriate	merely	because	Plaintiffs	have	also	asserted	a	breach	of	

contract	claim.		

Barclays	also	argues	that	this	claim	arose	out	of	a	tort-like	injury	and	is,	

therefore,	time-barred	under	Alabama’s	catch-all	two-year	statute	of	limitations,	

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Ala.	Code	§	6-2-38(l)	(1975).		Both	Barclays	and	Plaintiffs	agree	that	the	statute	of	

limitations	for	an	unjust	enrichment	claim	is	determined	by	the	nature	of	the	injury	

from	which	it	arises.		See	Auburn	Univ.	v.	Int’l	Bus.	Mach. Corp.,	716	F.Supp.2d	1114,	

1117-1119	(M.D.	Ala.	2010).4		Barclays	cites	Auburn	University but	fails	to	apply	the	

analysis;	instead,	it	asserts	that	“[t]he	court	in	[that	case]	found	that	the	claim	arose	

out	of	a	tort	injury.	.	.	and	that	[t]he	some	conclusion	would	be	reached	in	this	case	if	

there	were	no	express	contract.”		(Barclays’	Br.	27.)		As	Plaintiffs	point	out,	the	

unjust	enrichment	claim	in	Auburn	University arose	from	an	alleged	patent	

conversion,	a	tort-based	injury.		In	this	case,	the	unjust	enrichment	theory	is	quasicontractual	based	on	Plaintiffs’	assertion	that	Barclays	took	Plaintiffs’	payments	and	

misapplied	them,	essentially	using	the	funds	to	Barclays’	benefit.		See	White,	454	

F.Supp.2d	at	1133	n.	24 (unjust	enrichment	is	a	legal	fiction	used	to	create	an	

implied	contract).	 Therefore,	Alabama’s	six-year	statute	of	limitations	applicable	to	

breach	of	contract	actions	is	applicable.		See Ala.	Code	§	6-22-34(4)	(actions	founded	

on	contract	must	be	commenced	within	six	years).

Conversion	(Count	Eleven)

																																																							 4The	statue	of	limitations	applicable	to	unjust	enrichment	claims	has	not	

been	definitively	resolved.		In	Snider	v.	Morgan,	113	So.3d	643,	655	(Ala.	2012),	the		

the	Alabama Supreme	Court	stated:

The	court	in	Auburn	University observed	that	“Alabama	state	courts	

have	not	decided	whether	unjust-enrichment	claims	are	tort	claims	or	

implied-contract	claims,	much	less	which	statute	of	limitations	applies	

to	such	claims.”	Our	research	similarly	confirms	that	there	is	a	distinct	

absence	of	authority	definitively	stating	the	statute	of	limitations	

applicable	to	an	unjust-enrichment	claim.	We	need	not,	however,	

decide	that	issue	here.

Id. (quoting	Auburn	Univ.,	716	F.Supp.2d	at	1117).

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Barclays	contends	that	the	conversion	count	is	due	to	be	dismissed	because	it	

fails	to	state	a	claim	for	the	conversion	of	money.		In	Hensley	v.	Poole,	910	So.2d	96	

(Ala.	2005),	the	Alabama	Supreme	Court	explained	the	limitations	of	a	conversion	

action	when	the	conversion	involves	money:

This	Court	has	held	repeatedly	that	“	‘[g]enerally,	an	action	will	not	lie	

for	the	conversion	of	money’	”	unless	“	‘the	money	at	issue	is	capable	

of	identification.’	”	Only	when	money	is	“earmarked”	or	otherwise	

identifiable,	such	as	enclosed	in	a	container	like	a	bag	or	chest,	does	

an	action	lie	for	conversion	of	money.	In	Lewis	v.	Fowler,	479	So.2d	

725,	726	(Ala.1985),	this	Court	recognized,	by	reference	to Limbaugh	

v.	Merrill	Lynch,	Pierce,	Fenner	&	Smith,	Inc.,	732	F.2d	859	(11th	

Cir.1984),	that	“money	directly	traceable	to	a	special	account”—in	the	

Limbaugh case	a	“Ready	Assets	Trust	Account”—is	sufficiently	

identifiable	to	support	an	action	for	conversion.	So	long	as	accounts	at	

financial	institutions	are	“sufficiently	segregated	and	identifiable,”	this	

Court	will	generally	allow	a	conversion	claim	to	proceed.	

Id.	at	101 (some	internal	citations	omitted).		Plaintiffs	argue	that	the	allegations	of	

the	Amended	Complaint	are	sufficient	because	they	allege	that	“payments	were	

directly	traceable	to	a	particular	account”	and	involve	“specific	money	paid	by	

Plaintiffs.	.	.	on	particular	dates	[which	are	set	out	in	the	Amended	Complaint].”				

(Pls.’	Br.	24.)		 The	phrase	“directly	traceable	to	a	particular	account”	is	a	legal	

conclusion.		Moreover,	the	ability	to	trace	specific	payments	says	nothing	about	how	

those	payments	are	held.		Because	the	Amended	Complaint	does	not	identify	a	

“segregated	and	identifiable	account”	such	as	an	escrow	or	trust	account,	it	does	not	

support	a	claim	for	conversion.

Request	for	Injunctive	Relief	(Count	Twelve)

In	Count	Twelve,	Plaintiffs	have	asserted	their	request	for	injunctive	relief,	

including	“[a]	immediate	order”	requiring	Defendants	to	provide	a	full	accounting	of	

Plaintiffs’	mortgage	payments and	to	provide	(no	later	than	July	15,	2014)	revised	

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1098	tax	forms	to	properly	credit	Plaintiffs	with	mortgage	interest.		(Am.	Compl,	

Count	XII	¶	1.)		In	addition,	Plaintiffs	seek	“a	temporary	restraining	order,	to	be	

followed	by	a	preliminary,	and then	a	permanent	injunction, enjoining	Defendants	

from”	making	reports	to	credit	agencies,	providing	1098	former	making	any	

representation	about	Plaintiffs’	mortgage	loan	account	without	prior	approval	of	the	

Court.	 (Id. ¶	4.)		In	their	briefs,	neither	Barclays	nor	Plaintiffs	make	any	distinction	

among	the	types	of	injunctive	relief	sought—temporary	restraining	order	(TRO),	

preliminary	injunction	or	permanent	injunction—though	their	arguments	appear	to	

address	a	motion	for	preliminary	injunction.5		

The	requirements	for	obtaining	a	preliminary	injunction	are	well	settled:

A	district	court	may	grant	injunctive	relief	only	if	the	moving	party	

shows	that:	(1)	it	has	a	substantial	likelihood	of	success	on	the	merits;	

(2)	irreparable	injury	will	be	suffered	unless	the	injunction	issues;	(3)	

the	threatened	injury	to	the	movant	outweighs	whatever	damage	the	

proposed	injunction	may	cause	the	opposing	party;	and	(4)	if	issued,	

the	injunction	would	not	be	adverse	to	the	public	interest. In	this	

Circuit,	“[a]	preliminary	injunction	is	an	extraordinary	and	drastic	

remedy	not	to	be	granted	unless the	movant	clearly	established	the	

‘burden	of	persuasion’	”	as	to	each	of	the	four	prerequisites.

Siegel	v.	LePore,	234	F.3d	1163,	1176	(11th Cir.	2000)	(en	banc)	(internal	citations	

omitted).	

“A	showing	of	irreparable	injury	is	‘the	sine	qua	non	of	injunctive	relief,’”	and	

its	absence	“make[s] preliminary	injunctive	relief	improper.”			Id. Plaintiffs	argue	

that	they	will	be	irreparably	harmed	because	they	“may	not	be	able	to	resolve	their	

poor	credit	rating”	resulting	from	Barclays	actions	giving	rise	to	their	claims.		(Pls.’	

Br.	27.)				But	the	threat	of	injury	must	be	“real	and	immediate”	rather	than	“merely	

																																																							 5 Plaintiffs	filed	the	Amended	Complaint	on	July	3,	2014	but	did	not	pursue	

their	request	for	a	TRO.	

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conjectural	or	hypothetical.”		Church	v.	City	of	Huntsville,	30	F.3d	1332,	1337	(11th

Cir.	1994).		The	possibility	that	Plaintiffs	may	not	be	able	to	resolve	their	poor	credit	

rating	is	conjecture.		The	injury	to	Plaintiffs’	credit	rating	has	already	been	inflicted,	

and	there	is	no	reason	to	believe	that	an	immediate	injunction	would	be	more	likely	

to	“resolve	their	poor	credit	rating”	than	one	entered	after	a	trial	on	the	merits.		In	

sum,	Plaintiffs	are	not	entitled	to	preliminary	injunctive	relief.

Conclusion

Defendant	Barclays	motion	to	dismiss	is	due	to	be	and	hereby	is	GRANTED,	

in	part,	as	to	Plaintiffs’	Breach	of	Contract	based	on	third-party	beneficiary	theory	

(Count	One),	Breach	of	Fiduciary	Duty	(Count	Three),	Negligence (Count	Four),	

Fraud	(Count	Six),	Promissory	Fraud (Count	Seven),	Fraudulent	

Suppression/Concealment (Count	Eight),	Unconscionability (Count	Nine),	and	

Conversion (Count	Eleven).		The	motion	is	DENIED,	as	to	Plaintiffs’	claim	for	Unjust	

Enrichment	(Count	Ten)	and	DENIED,	in part,	as	to	Plaintiffs’	claims	for	Breach	of	

Contract	claim	based	on	violation	of	the	bankruptcy	plan	of	reorganization	(Count	

One)	and	Breach	of	the	Duty	of	Good	Faith	and	Fair	Dealing	(Count Two).		Plaintiffs’	

request	for	preliminary	injunctive	relief	is	DENIED,	and	their	request	for	a	

temporary	restraining	order	is	MOOT.

DONE and	ORDERED this	the	17th day	of	November,	2014,	nunc	pro	tunc the	

15th day	of	October,	2014.

s/Charles	R.	Butler,	Jr.

Senior	United	States	District	Judge

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