Court Opinion

ID: 4656346
Source: CourtListenerOpinion
Date Created: 2021-02-01 20:00:47.824581+00
Date Added: 2024-06-11T08:00:51.188309
License: Public Domain

USCA11 Case: 19-15182      Date Filed: 02/01/2021   Page: 1 of 7

                                                              [DO NOT PUBLISH]

               IN THE UNITED STATES COURT OF APPEALS

                        FOR THE ELEVENTH CIRCUIT
                          ________________________

                                No. 19-15182
                          ________________________

                    D.C. Docket No. 1:19-cv-00258-TFM-MU

LEWIS ARCHER,
SHEARIE ARCHER,

                                                              Plaintiffs-Appellants,

                                      versus

AMERICA’S FIRST FEDERAL CREDIT UNION,
                                                               Defendant-Appellee.
                          ________________________

                   Appeal from the United States District Court
                      for the Southern District of Alabama
                          ________________________

                                (February 1, 2021)

Before WILLIAM PRYOR, Chief Judge, GRANT and TJOFLAT, Circuit Judges.

GRANT, Circuit Judge:

      After a state court granted America’s First possession of the Archers’ home,

Lewis and Shearie Archer sued in federal court asserting violations of the Real

Estate Settlement Procedures Act. But because their claims were fully litigated in
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the earlier state court action—or, at least, should have been—the doctrine of res

judicata prevents us from giving those issues a second look.

                                           I.

      We accept as true all of the Archers’ factual allegations in this appeal of a

ruling on a motion to dismiss. Luke v. Gulley, 975 F.3d 1140, 1143 (11th Cir.

2020). When Lewis and Shearie Archer stopped paying the mortgage on their

home, America’s First declared the mortgage in default. It attempted to foreclose

seven times over nineteen months—a “stressful” and “cruel” exercise that

culminated in a foreclosure sale on January 29, 2016. Though their house sold, the

Archers refused to leave. The stress had caused Shearie to go into a diabetic coma,

which she remained in for seven days.

      Because the Archers did not vacate the premises, America’s First initiated an

ejectment action in the Circuit Court of Mobile County, Alabama. The Archers

hired an attorney; they say they told him to bring claims under the Real Estate

Settlement Procedures Act in federal court. He never did. But the Archers did

raise various Real Estate Settlement Procedures Act allegations as defenses in the

state court action. In their initial pleading, they asserted that the foreclosure sale

was conducted “contrary to federal law including, but not limited to” the Real

Estate Settlement Procedures Act. And in response to America’s First’s motion for

summary judgment, they claimed that America’s First engaged in “Dual Tracking”

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by proceeding with foreclosure during the mortgage modification process. They

also argued that America’s First failed to notify them of their appeal rights under

12 C.F.R. § 1024.41(f)(1) during the modification process.

      The state court nonetheless granted summary judgment for America’s First

and awarded it possession of the property. The Archers, now proceeding pro se,

appealed the order to the Alabama Court of Civil Appeals. That court affirmed the

trial court’s judgment.

      Two weeks later, the Archers commenced this action in federal court. Their

claim was “filed pursuant to section 6(f) of” the Real Estate Settlement Procedures

Act. They alleged that America’s First engaged in “Dual-Tracking,” in violation

of 12 C.F.R. §§ 1024.41(f)(1)(i) and 1024.41(i). America’s First moved to

dismiss, arguing that the claims were barred by the Act’s three-year statute of

limitations and by res judicata. It also argued that any new claims brought under

the Act were barred because the Archers failed to raise them as compulsory

counterclaims in the earlier action. The district court agreed that the Archers had

missed the Act’s filing deadline, and dismissed their claims on that basis.

      This appeal followed. The Archers contend that the “extraordinary

circumstances” of their case warrant equitable tolling of the Act’s statute of

limitations. America’s First disagrees, and also says that the Archers’ claims are

barred by the doctrine of res judicata either way.

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                                          II.

      We review de novo the district court’s grant of a motion to dismiss. Hill v.

White, 321 F.3d 1334, 1335 (11th Cir. 2003). We may affirm the district court’s

judgment for any reason supported by the record, even if not relied upon by the

district court. United States v. Al-Arian, 514 F.3d 1184, 1189 (11th Cir. 2008).

                                          III.

      When asked to give res judicata effect to a state court judgment, we must

apply the res judicata principles of “the state whose decision is set up as a bar to

further litigation.” Kizzire v. Baptist Health Sys., Inc., 441 F.3d 1306, 1308 (11th

Cir. 2006) (quoting Amey, Inc. v. Gulf Abstract & Title, Inc., 758 F.2d 1486, 1509

(11th Cir. 1985)). Because America’s First contends that the Alabama state court

judgment bars this federal action, the res judicata principles of Alabama apply.

      Under Alabama law, the essential elements of res judicata are: “(1) a prior

judgment on the merits, (2) rendered by a court of competent jurisdiction, (3) with

substantial identity of the parties, and (4) with the same cause of action presented

in both actions.” Id. at 1308–09 (quoting Equity Res. Mgmt., Inc. v. Vinson, 723

So. 2d 634, 636 (Ala. 1998)). If those four elements are met, then any claim that

was—or could have been—adjudicated in the earlier action is “barred from future

litigation.” Id. at 1309.

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      The first three elements are easily satisfied here. The trial court’s grant of

summary judgment, which was affirmed by the Alabama Court of Civil Appeals,

clearly constitutes a prior judgment on the merits. Ex parte Jefferson County, 656

So. 2d 382, 385 (Ala. 1995). There is no doubt that both the Circuit Court of

Mobile County and the Alabama Court of Civil Appeals are courts of competent

jurisdiction; federal and state courts have concurrent jurisdiction over Real Estate

Settlement Procedure Act claims. See 12 U.S.C. § 2614. And, of course, the

parties in this action and in the ejectment action are the same—they have simply

switched places.

      That leaves us with the question of whether it was the “same cause of

action” in both actions. Alabama uses the “substantial evidence” test to answer

this question. Kizzire, 441 F.3d at 1309. If the same evidence substantially

supports both actions, this element is met. Id. Res judicata applies not just to the

precise legal theories advanced in the earlier case, but to “all legal theories and

claims arising out of the same nucleus of operative facts.” Id. (quoting Old

Republic Ins. Co. v. Lanier, 790 So. 2d 922, 928 (Ala. 2000)).

      Both the state and federal court actions concerned the same nucleus of

operative facts. In state court, America’s First sought possession of the Archers’

home based on the foreclosure sale; the Archers defended by saying that the

foreclosure sale was void under the Real Estate Settlement Procedures Act. The

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Archers also argued that America’s First failed to provide the proper notifications

and that America’s First engaged in “Dual Tracking.” Then, in federal court, the

Archers’ newly filed claims again centered on the foreclosure of their home. The

couple alleged that America’s First failed to provide the proper notifications and

violated “Dual-Tracking protection laws” when it foreclosed on their home.

Indeed, most of the facts and allegations from their present complaint came from

their various state court filings. Each of their arguments in federal court arise from

the exact same transaction and occurrence as that of the earlier litigation.

       There is no question that the Archers’ federal complaint attempts to raise

claims arising out of the same operative facts as the state court action. Kizzire, 441

F.3d at 1309. And because the same evidence “substantially supports” both suits,

all four elements of res judicata are met. Id. at 1310. Though the Archers may not

have raised the exact same claims in each suit, the legal theories in both arise out

of the same nucleus of operative facts. In these circumstances, permitting the

Archers to proceed would be giving them a second bite at the apple, which we

cannot do.1

       The Archers devote two sentences of their initial brief to arguing that the

district court violated the “Supremacy Clause” when it refused to stay the Alabama

1
  Because we hold that the Archers’ claims were barred by res judicata, we need not consider
whether they were also barred by the Real Estate Settlement Procedure Act’s statute of
limitations.
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court’s writ of possession while their case was ongoing. But the Archers provide

no additional support for the idea that a district court might have the power to

collaterally review a state court judgment regarding the validity of a foreclosure

proceeding. This argument was not fully briefed, so it is abandoned. Access Now,

Inc. v. Sw. Airlines Co., 385 F.3d 1324, 1330 (11th Cir. 2004).

                                    *      *      *

       Because the Archers’ complaint raises claims that arise out of the same

nucleus of operative fact as the earlier state court action, the doctrine of res

judicata bars their claims. For that reason, we AFFIRM the judgment of the

district court.

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