Opinion ID: 2652412
Heading Depth: 2
Heading Rank: 2

Heading: Rescission and Reformation and Quiet Title

Text: The district court, relying on Yaldu v. Bank of America Corp., 700 F. Supp. 2d 832, 847 (E.D. Mich. 2010) (stating that “[r]escission and reformation are not separate causes of action; rather, they are equitable remedies”), dismissed Count 2 of Rautu’s complaint for failure to state a claim. R. 11 (D. Ct. Op. at 7) (Page ID #135). Rautu now argues that rescission and reformation are causes of action under Michigan law. In Count 3, Rautu puts forward a quiet-title claim, requesting that the court use its equitable power to vindicate his rights. The district court determined that Rautu’s “failure to honor the terms of the loan agreement” sullied his hands. Id. at 8 (Page ID #136). 8 No. 13-1436 Rautu v. U.S. Bank Consequently, the doctrine of unclean hands “bars [Rautu] from asserting a quiet-title action.” Id.4 This panel does not have to interpret Michigan law to determine whether rescission and reformation are causes of action or merely equitable remedies because Rautu’s equitable claims—reformation and rescission and the quiet title cause of action—fail as causes of action. On both Count 2 and Count 3, Rautu requests that the court use its equitable power to change the relationship between himself and U.S. Bank with respect to the home and mortgage. His stated reason for why the court should take this action is because of the fraud and misrepresentation committed by U.S. Bank. See R. 1 (Compl. ¶ 24) (Page ID #10) (basing the rescission and reformation counts on the allegation that “[d]efendant materially misrepresented to plaintiffs (sic) the true nature of the financing”); id. ¶ 32 (Page ID #11) (arguing that the court should act on the quiet title claim because “defendants’ security interest in the home was obtained by fraud in the inducement”). Even Rautu’s opposition to the motion to dismiss clearly predicated any equitable remedy found in Count 2 or Count 3 on “the fraud committed by defendants, and request[ed] their respective types of equitable relief.” R. 5 (Pl.’s Resp. Opp’n Def.’s Mot. Dismiss 10) (Page ID #117). As we have noted above, however, Rautu fails to allege the nature of this fraud with sufficient particularity and does not provide any factual details on the substance of the misrepresentations, who made them, when and where they were made, or any 4 U.S. Bank made this argument in its motion to dismiss before the district court, and the district court accepted it. Rautu’s response to the motion to dismiss failed to address this argument. Having failed to address the doctrine of unclean hands below, he has forfeited the argument. See Dealer Computer Servs., Inc. v. Dub Herring Ford, 623 F.3d 348, 357 (6th Cir. 2010). 9 No. 13-1436 Rautu v. U.S. Bank other salient facts. Consequently, Rautu’s complaint is inadequate to state a claim upon which relief may be granted. We affirm the district court’s dismissals of Count 2 and Count 3.