Court Opinion

ID: 6334256
Source: CourtListenerOpinion
Date Created: 2022-04-22 18:01:53.031594+00
Date Added: 2024-06-11T09:23:35.324764
License: Public Domain

FIRST DIVISION
                               BARNES, P. J.,
                           BROWN and HODGES, JJ.

                   NOTICE: Motions for reconsideration must be
                   physically received in our clerk’s office within ten
                   days of the date of decision to be deemed timely filed.
                              https://www.gaappeals.us/rules

                                                                     April 22, 2022

In the Court of Appeals of Georgia
 A22A0355. BAZEMORE et al. v. U. S. BANK NATIONAL
     ASSOCIATION et al.

      HODGES, Judge.

      Michael J. Bazemore and Vivian R. Bazemore sued U. S. National Bank

Association (the “Bank”) and the law firm McCalla Raymer Leibert Pierce, LLC

(“McCalla”) for claims stemming from the foreclosure of their home. Defendants

moved to dismiss the lawsuit for failure to state a claim pursuant to OCGA § 9-11-12

(b) (6). The trial court granted the motions, and the Bazemores appealed. We find that

the trial court erred in dismissing some, but not all, of the claims. Therefore, we

affirm in part and reverse in part, and remand this case for further proceedings

consistent with this opinion.
      “We review de novo a trial court’s determination that a pleading fails to state

a claim upon which relief can be granted, treating all material allegations set forth in

the complaint as true, treating all denials set forth in the answer as false, and

resolving any doubts in favor of the plaintiff.” Campbell v. Ailion, 338 Ga. App. 382,

383 (790 SE2d 68) (2016).

      So viewed, the Bazemores allege that they owned property at 2554 Laquanda

Court SW, Atlanta, Georgia 30331. They executed a security deed to U. S. Bank N.

A., Its Successors and Assigns, and MERS Mortgage Electronic Registration

Systems, Inc. This deed was subsequently assigned to the Bank. The Bazemores

allege they received a deficient notice of foreclosure sale from McCalla on behalf of

the Bank. Specifically, the Bazemores pled as follows in their complaint:

      11. Defendants, MCCALLA, mailed a Notice of Foreclosure Sale to
      Plaintiffs. The notice did not comply with Georgia law.

      12. Defendants, MCCALLA, advertising the subject property failed to
      satisfy the mandatory statutory requirements set forth pursuant to OCGA
      § 44-14-162.2 as it did not include the individual or entity who had the
      full authority to negotiate, amend, and modify all terms of the mortgage
      with Plaintiffs. Failure to comply with the mandatory statutory
      requirements rendered the non-judicial foreclosure premature and
      invalid.

                                           2
      13. Plaintiffs contacted U. S. Bank National Association, the entity
      listed on the sale advertisement having full authority to negotiate, amend
      and modify all terms of the mortgage, and was informed said entity did
      not have such authority.

      14. Defendant, [Bank] failed to provide Plaintiffs with the required
      notice(s) listed in Paragraph 22 of the Security Deed prior to exercising
      the power of sale. Failure to comply with the mandatory contractual
      requirements rendered the non-judicial foreclose (sic) proceedings
      premature and invalid.

      15. Defendants initiated a non-judicial foreclosure of Plaintiffs’ property
      without acceleration of indebtedness as required by Paragraph 22 of the
      Security Deed.

      Following the notice of foreclosure, defendants advertised the property for

foreclosure sale, and ultimately sold the property in a non-judicial foreclosure sale.

      The Bazemores filed suit, and in their complaint, they explicitly assert causes

of action for wrongful foreclosure, breach of contract, breach of the duty of good faith

and fair dealing, invasion of privacy, violation of the Georgia Racketeer influenced

and Corrupt Organizations Act (RICO), attorney fees, and punitive damages.1 While

      1
         Attorney fees and punitive damages as pled are not actually distinct causes
of action. See Franklin Credit Mgmt. Corp. v. Friedenberg, 275 Ga. App. 236, 242
(2) (d) (620 SE2d 463) (2005) (“The law does not support the concept that pursuing

                                           3
not separately identified, the Bazemores also appear to assert claims for trespass and

intentional infliction of emotional distress based on the content of the complaint.

      Defendants answered and attached to their answer several documents.2 They

also moved to dismiss the Bazemores’ complaint for failure to state a claim upon

which relief can be granted pursuant to OCGA § 9-11-12 (b) (6). The trial court

granted defendants’ motions, and the Bazemores appeal.

      In a single enumeration of error, the Bazemores contend that the trial court

erred dismissing their complaint. While some of the Bazemores’ claims were

appropriately dismissed, we agree that some were improperly dismissed.

      At the outset, we note the standard that governs our review of the Bazemores’

complaint. “The Georgia Civil Practice Act requires only notice pleading and, under

the Act, pleadings are to be construed liberally and reasonably to achieve substantial

justice consistent with the statutory requirements of the Act.” Rucker v. Columbia

Nat. Ins. Co., 307 Ga. App. 444, 446 (1) (a) (705 SE2d 270) (2010). “[I]t is no longer

each type of damages flowing from a specific tort is a separate and independent cause
of action.”).
      2
        The parties disagree as to whether we can consider the documents attached
to the answer in analyzing a motion to dismiss for failure to state a claim. We need
not address this dispute, however, in light of the specific allegations of the complaint,
to which the documents attached to the answer are non-responsive.

                                           4
necessary for a complaint to set forth all of the elements of a cause of action in order

to survive a motion to dismiss for failure to state a claim. If, within the framework of

the complaint, evidence may be introduced which will sustain a grant of relief to the

plaintiff, the complaint is sufficient.” (Citation and punctuation omitted.) Scott v.

Scott, 311 Ga. App. 726, 729 (1) (716 SE2d 809) (2011).

      If a complaint gives the defendant[s] fair notice of the nature of the
      claim, it should be dismissed for failure to state a claim only if, as our
      Supreme Court has explained, its allegations “disclose with certainty”
      that no set of facts consistent with the allegations could be proved that
      would entitle the plaintiff[s] to the relief [they] seek[]. . . . In assessing
      the sufficiency of the complaint, we view its allegations of fact in the
      light most favorable to the plaintiff[s].

(Citations and punctuation omitted.) Benedict v. State Farm Bank, FSB, 309 Ga. App.

133, 134 (1) (709 SE2d 314) (2011). With this standard in mind, we consider the

individual counts of the Bazemores’ complaint. We note that the Bazemores

identified causes of action in the beginning of their complaint, but do not individually

name the causes of action they later plead. Some of the enumerated “claim[s] for

relief[,]” as they are called by the Bazemores, appear to include elements of multiple

claims even though they purport to plead a single claim. We have done our best to

interpret the complaint despite its inartful drafting.

                                            5
      a. Wrongful Foreclosure

      Georgia law requires that

      [n]otice of the initiation of proceedings to exercise a power of sale in a
      mortgage, security deed, or other lien contract shall be given to the
      debtor by the secured creditor no later than 30 days before the date of
      the proposed foreclosure. Such notice shall be in writing, shall include
      the name, address, and telephone number of the individual or entity who
      shall have full authority to negotiate, amend, and modify all terms of the
      mortgage with the debtor, and shall be sent by registered or certified
      mail or statutory overnight delivery, return receipt requested, to the
      property address or to such other address as the debtor may designate by
      written notice to the secured creditor.

(Emphasis supplied.) OCGA § 44-14-162.2 (a).

      “Where a grantee does not comply with the statutory duty to exercise fairly the

power of sale in a deed to secure debt, OCGA § 23-2-114, the debtor may either seek

to set aside the foreclosure or sue for damages for the tort of wrongful foreclosure[.]”

Calhoun First Nat. Bank v. Dickens, 264 Ga. 285, 285-286 (1) (443 SE2d 837)

(1994). When plaintiffs allege that the statutory requirements of OCGA § 44-14-

162.2 have not been followed, they have asserted a claim for wrongful foreclosure.

                                           6
Babalola v. HSBC Bank, USA, N.A., 324 Ga. App. 750, 753-754 (2) (a) (751 SE2d

545) (2013).3

      As identified above, the Bazemores allege in Paragraph 11 of their complaint

that the notice of foreclosure they received from McCalla on behalf of the Bank failed

to comply with Georgia law. They then specify that defendants failed to comply with

OCGA § 44-14-162.2 in that they failed to “include the individual or entity who had

the full authority to negotiate, amend, and modify all terms of the mortgage with [the

Bazemores].” Defendants are correct that in Paragraph 12 of their complaint, the

Bazemores reference the advertisement of the property, which is not legally required

to properly identify such an individual or entity. But, in Paragraph 12, they also

reference the statute which contains the requirements for the foreclosure notice,

which does include a requirement to properly identify such an individual or entity.

Given the standard by which we judge their complaint, we find that this was sufficient

to put defendants on notice that the Bazemores alleged a defect with the foreclosure

notice.4 We need not decide whether to consider the exhibits attached to the answers

      3
      McCalla has not alleged that it is an improper party against which to bring the
wrongful foreclosure claim, and thus we do not reach this issue.
      4
       We note that the Bazemores were represented by counsel in the trial court and
encourage attorneys to be more careful in drafting their pleadings.

                                          7
filed by defendants because it is possible that the Bazemores could later establish

facts which demonstrate a failure to comply with OCGA § 44-14-162.2 which these

documents do not address, such as an allegation that the entity identified in the

foreclosure notice as having the authority to “negotiate, amend, and modify all terms

of the mortgage” was not the correct entity. See Mbigi v. Wells Fargo Home Mortg.,

336 Ga. App. 316, 321 (1) (b) (785 SE2d 8) (2016) (physical precedent only).

Accordingly, because it is possible the Bazemores may introduce evidence which

would sustain a claim for wrongful foreclosure as pled, the trial court erred in

dismissing this claim. See Scott, 311 Ga. App. at 729 (1).

      b. Trespass

      The Bazemores do not enumerate trespass as a cause of action at the beginning

of their complaint, but in their complaint under their first claim for relief, they allege

that “Defendants unlawfully interfered with the property rights of the Plaintiffs” and

cite to the definition of trespass contained in OCGA § 1-3-3 (20). The Bazemores also

contend that defendants “deprived the Plaintiffs of the right to exclusive use and

benefit of the subject property” and cite to Georgia’s trespass statute, OCGA § 51-9-

1.

                                            8
      The Bazemores’ trespass claim is not well pled, but it seems to stem from their

allegation that defendants wrongfully foreclosed on their property. There is no

allegation that defendants trespassed on the Bazemores’ property in a way which is

unrelated to the allegedly wrongful foreclosure. Under Georgia law, “the injured party

may not both set aside or cancel the foreclosure and also recover damages for the

value of the property.” (Citation, punctuation, and emphasis omitted.) Calhoun First

Nat. Bank, 264 Ga. at 286 (1). In their complaint, the Bazemores seek money

damages for the allegedly wrongful foreclosure; they do not seek to set it aside. “The

purchaser at a foreclosure sale under a power of sale in a security deed is the sole

owner of the property until and unless the sale is set aside.” (Emphasis in original.)

Vines v. LaSalle Bank Nat. Assn., 302 Ga. App. 353 (691 SE2d 242) (2010).

Accordingly, defendants could not trespass on property which the Bazemores admit

they no longer own – even assuming it is wrongful that they no longer own it – and,

to the extent the Bazemores attempted to assert a claim for trespass, it was properly

dismissed for failure to state a claim.

      c. Georgia RICO

      Georgia law provides that “[i]t shall be unlawful for any person, through a

pattern of racketeering activity or proceeds derived therefrom, to acquire or maintain,

                                          9
directly or indirectly, any interest in or control of any enterprise, real property, or

personal property of any nature, including money.” OCGA § 16-14-4 (a). “Pattern of

racketeering activity” is defined as

       [e]ngaging in at least two acts of racketeering activity in furtherance of
       one or more incidents, schemes, or transactions that have the same or
       similar intents, results, accomplices, victims, or methods of commission
       or otherwise are interrelated by distinguishing characteristics and are not
       isolated incidents, provided at least one of such acts occurred after July
       1, 1980, and that the last of such acts occurred within four years,
       excluding any periods of imprisonment, after the commission of a prior
       act of racketeering activity[.]

OCGA § 16-14-3 (4) (A). Relevant to this case, “racketeering activity” includes theft

in violation of Article 1 of Chapter 8 of Title 16 of the Official Code of Georgia,

violation of the Georgia Residential Mortgage Fraud Act,5 and conduct defined as

racketeering activity pursuant to 18 U. S. C. § 1961 (1), which includes wire fraud

and mail fraud.6 OCGA § 16-14-3 (5) (A) (xii), (xv), (C).

       5
         “A person commits the offense of residential mortgage fraud when, with the
intent to defraud, such person . . . [f]iles or causes to be filed with the official registrar
of deeds of any county of this state any document such person knows to contain a
deliberate misstatement, misrepresentation, or omission.” OCGA § 16-8-102 (5).
       6
       “Mail and wire fraud occurs when a person (1) intentionally participates in
a scheme to defraud another of money or property and (2) uses the mails or wires in

                                             10
      The Bazemores allege several predicate acts to form the basis of their Georgia

RICO claim:

(1) theft in violation of OCGA § 16-8-2 and 16-8-4 by attempting to unlawfully

appropriate and unlawfully appropriating their property by “obtaining [their] property

through deceitful means with the intention of depriving the [Bazemores] of such

property.” More specifically, the Bazemores allege that

      defendants engaged in deceit when they intentionally created and failed
      to correct the false impression that [the Bank] was the owner of the
      subject property and indebtedness with the legal right to foreclose
      (OCGA § 16-8-3 (b) (1) & (2)), when they intentionally prevented
      Plaintiffs from acquiring information pertinent to the disposition of
      subject property by concealing the true identity of the creditor and
      secreting unrecorded property transfers (OCGA § 16-8-3 (b) (3)), when
      they sold and/or transferred property intentionally failing to disclose
      Plaintiffs’ substantial and valid adverse claim, and the legal impediment
      to the enjoyment of the property (OCGA § 16-8-3 (b) (4)). (Footnotes
      omitted.)

furtherance of that scheme. In all averments of fraud or mistake, the circumstance
constituting fraud or mistake shall be stated with particularity. . . . Likewise,
allegations of mail and wire fraud in a civil RICO action must not only be pled in
accordance with the heightened pleading standard of OCGA § 9-11-9 (b), but also are
required to include such matters as the time, place, and content of the alleged
misrepresentations, as well as who made the alleged misrepresentations and to
whom.” (Citations, punctuation, and footnote omitted.) Z-Space, Inc. v. Dantanna’s
CNN Center, LLC, 349 Ga. App. 248, 254 (2) (c) (825 SE2d 628) (2019).

                                         11
(2) Violating OCGA § 16-8-102 by

      filing with the official registrar of deeds of Rockdale county a document
      that   defendants knew contained           a   deliberate    misstatement,
      misrepresentation, and omission. Specifically, defendants violated
      OCGA § 16-8-102 when they filed the advertisement with the legal
      organs of Fulton County containing the deliberate misstatements.

(3) Violating 18 U. S. C. § 1341 (mail fraud) and 18 U. S. C. § 1343 (wire fraud).

      Here, the Bazemores have alleged four predicate acts which they claim

constitute a pattern of racketeering activity – theft and theft by deception, residential

mortgage fraud,7 mail fraud, and wire fraud. See OCGA § 16-14-3; Dixon v. Branch

Banking & Tr. Co., 349 Ga. App. 768, 775 (6) (824 SE2d 760) (2019) (physical

precedent only) (“Theft by deception and residential mortgage fraud, if shown, would

constitute RICO predicate acts.”); Mbigi, 336 Ga. App. at 323-324 (2) (finding that

plaintiff’s claim that a bank stole the equity in his home by wrongfully foreclosing

      7
        In support of this claim, the Bazemores allege that documents were filed in
Rockdale County, but their property was located in Fulton County. Defendants
contend that the Bazemores’ complaint contains boilerplate language routinely used
by their trial counsel in multiple cases on behalf of multiple parties and that this
errant reference to Rockdale County is due to the failure by counsel for the
Bazemores to appropriately tailor this boilerplate language to the facts of this case.
This may be true. Regardless, at the motion to dismiss phase, it is of no consequence
given the standard with which we review the Bazemores’ pleadings.

                                           12
on it and that the bank filed a deed under power which contained a fraudulent

statement was sufficient allegation of a pattern of racketeering activity for a Georgia

RICO claim to survive a motion to dismiss). The claims for theft and residential

mortgage fraud are sufficiently pled. The Bazemores’ claims for theft by deception,

mail fraud, and wire fraud are not pled with the requisite degree of particularity, but

this is not fatal at the motion to dismiss stage, as the trial court should treat the

motion to dismiss as a motion for more definite statement as to these claims. See

Roberts v. JP Morgan Chase Bank, Nat. Assn., 342 Ga. App. 73, 79 (3) (802 SE2d

880) (2017); see also Z-Space, Inc., 349 Ga. App. at 255 (2) (c) (“Although fraud

must be pled with particularity under OCGA § 9-11-9 (b), a complaint alleging fraud

should not be dismissed for failure to state a claim unless it appears beyond a doubt

that the pleader can prove no set of facts in support of his claim which would entitle

him to relief. Rather than move to dismiss, a defendant seeking greater particularity

may either move for a more definite statement or wait for the outcome of discovery.”)

(citation omitted).

      As [the Bazemores’] complaint could allege . . . that [they were] injured
      by at least two predicate acts which could constitute a pattern of
      racketeering activity, [defendants have] not shown that [the Bazemores]
      could not possibly introduce evidence within the framework of the

                                          13
      complaint sufficient to grant relief on the RICO claim. The dismissal of
      [the Bazemores’] RICO claim is therefore reversed.

Dixon, 349 Ga. App. at 775 (6).

      d. Invasion of Privacy

      There are several manners in which one can commit the tort of invasion of

privacy, and one such manner is “[p]ublicity which places the plaintiff in a false light

in the public eye[.]” (Citation and punctuation omitted.) Assn. Servs., Inc. v. Smith,

249 Ga. App. 629, 633 (4) (549 SE2d 454) (2001).

      In a false light case, the interest protected is clearly that of reputation,
      with the same overtones of mental distress as in defamation. Essentially,
      to establish a claim of false light, [ ] plaintiff[s] must establish the
      existence of false publicity that depicts the plaintiff[s] as something or
      someone which [they are] not. Next, the plaintiff[s] must demonstrate
      that the false light in which [they were] placed would be highly
      offensive to a reasonable person.

Id.

      As discussed above, the Bazemores have adequately pled wrongful foreclosure

for purposes of surviving a motion to dismiss for failure to state a claim. Accordingly,

their derivative claim that the foreclosure advertisement placed them in a false light

survives at this stage as well. The trial court erred in dismissing this claim.

                                          14
      e. Breach of Contract

      In their fourth and fifth claims for relief, the Bazemores allege that the terms

of the note and security deed were violated because defendants failed to satisfy the

contractual requirements necessary prior to exercising the power of sale. At the

outset, the Bazemores do not allege any contract between themselves and McCalla.

Accordingly, the trial court properly dismissed any breach of contract claim against

it.

      As for breach of contract claims against the Bank,

      The elements for a breach of contract claim in Georgia are the (1) breach
      and the (2) resultant damages (3) to the party who has the right to
      complain about the contract being broken. The security deed [the
      Bazemores allegedly] executed in favor of [the Bank allegedly]
      contained a power of sale and was thus a contract and its provisions are
      controlling as to the rights of the parties thereto and their privies. . . .
      [P]owers contained in a deed to secure debt are matters of contract, and
      will be enforced as written.

(Citations and punctuation omitted.) Roberts, 342 Ga. App. at 76 (1); see also

McCarter v. Bankers Trust Co., 247 Ga. App. 129, 132 (2) (543 SE2d 755) (2000)

(“Under Georgia law, it is clear that a security deed which includes a power of sale

is a contract and its provisions are controlling as to the rights of the parties thereto

                                          15
and their privies.”) (citation and punctuation omitted.). As discussed above, the

Bazemores allege that the foreclosure was wrongful because they were not given

proper notice, and here they also allege that this was in violation of the terms of their

contract with the Bank. Accordingly, the trial court erred in dismissing the breach of

contract claim against the Bank for failure to state a claim.

      However,

      [e]very contract implies a covenant of good faith and fair dealing in the
      contract’s performance and enforcement. The implied covenant modifies
      and becomes a part of the provisions of the contract, but the covenant
      cannot be breached apart from the contract provisions it modifies and
      therefore cannot provide an independent basis for liability.

Onbrand Media v. Codex Consulting, Inc., 301 Ga. App. 141, 147 (2) (c) (687 SE2d

168) (2009). Thus, although listed as if it is a separate cause of action, the

Bazemores’ breach of the duty of good faith and fair dealing claim is not in fact its

own claim.

      f. Intentional Infliction of Emotional Distress

      Although not separately identified at the beginning of their complaint, in their

sixth claim for relief, the Bazemores seem to make a claim for intentional infliction

of emotional distress. To prevail on this claim, the Bazemores must show “(1) The

                                           16
conduct must be intentional or reckless; (2) The conduct must be extreme and

outrageous; (3) There must be a causal connection between the wrongful conduct and

the emotional distress; and (4) The emotional distress must be severe.” (Citation

omitted.) United Parcel Serv. v. Moore, 238 Ga. App. 376, 377 (519 SE2d 15) (1999).

      The rule of thumb in determining whether the conduct complained of
      was sufficiently extreme and outrageous is whether the recitation of the
      facts to an average member of the community would arouse her
      resentment against the defendant so that she would exclaim
      “Outrageous!” It must be so serious as to naturally give rise to such
      intense feelings of humiliation, embarrassment, fright or extreme
      outrage as to cause severe emotional distress. It does not include mere
      insults, indignities, threats, annoyances, petty oppressions, or other
      vicissitudes of daily living, but must go beyond all reasonable bounds
      of decency so as to be regarded as atrocious and utterly intolerable in a
      civilized community. Whether reasonable persons could find the
      conduct reaches this level is a question of law for the court.

(Citations and punctuation omitted.) Id. The conduct alleged by the Bazemores in

their complaint, as a matter of law, does not rise to this level. See Racette v. Bank of

America, N. A., 318 Ga. App. 171, 179-180 (3) (733 SE2d 457) (2012) (“But the

[plaintiffs’] allegation that the appellees conducted the 2011 Foreclosure Sale despite

knowing of inaccuracies in the published foreclosure advertisements cannot be

                                          17
described as extreme, outrageous, atrocious, intolerable or beyond the bounds of

decency. It follows that the trial court committed no error in dismissing their claim

for intentional infliction of emotional distress.”) (citations and punctuation omitted).

      In summary, the trial court properly dismissed the Bazemores’ claims for

trespass and intentional infliction of emotional distress against all defendants and

breach of contract against McCalla. The trial court, however, erred in dismissing the

Bazemores’ claims against all parties for wrongful foreclosure, violation of Georgia’s

civil RICO, and invasion of privacy, as well as their breach of contract claim against

the Bank. We offer no opinion as to the validity of these claims or other dispositive

motions which defendants may file, but due to the standard with which we review a

motion to dismiss pursuant to OCGA § 9-11-12 (b) (6), dismissal of those claims was

improper. See Webb v. Bank of America, N. A., 328 Ga. App. 62, 64 (761 SE2d 485)

(2014) (“[Defendants] factual allegations [which contradict the allegations of the

complaint] do not require dismissal of the complaint for failure to state a claim. This

is factual evidence which may or may not be developed during discovery and can be

considered on a subsequent motion for summary judgment. Because it cannot be said

with certainty that within the framework of the complaint no evidence could be

                                          18
introduced that would support the claims for relief, the motion to dismiss should have

been denied.”) (citations and punctuation omitted).

      Judgment affirmed in part and reversed in part, and case remanded with

direction. Barnes, P. J., and Brown, J., concur.

                                         19