Court Opinion

ID: 3191497
Source: CourtListenerOpinion
Date Created: 2016-04-05 18:00:56.342684+00
Date Added: 2024-06-11T14:08:33.566002
License: Public Domain

Case: 15-30706      Document: 00513451579         Page: 1    Date Filed: 04/05/2016

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT

                                    No. 15-30706                         United States Court of Appeals
                                  Summary Calendar                                Fifth Circuit

                                                                                FILED
                                                                             April 5, 2016
EVELYN ALCALA JEANSONNE,                                                   Lyle W. Cayce
                                                                                Clerk
              Plaintiff - Appellant

v.

GENERATION MORTGAGE COMPANY,

              Defendant - Appellee

                   Appeal from the United States District Court
                      for the Eastern District of Louisiana
                             USDC No. 2:15-CV-1014

Before KING, CLEMENT, and OWEN, Circuit Judges.
PER CURIAM:*
       Evelyn Jeansonne was married to Avrel Jeansonne. They purchased a
community home in New Orleans in 1988. Some years later, Avrel was
diagnosed with colon cancer. In order to cover mounting medical expenses, the
Jeansonnes sought a home equity conversion mortgage (HECM) from Wells
Fargo Bank. Evelyn was not old enough to qualify as an HECM borrower, so

       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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                                     No. 15-30706
on May 20, 2010, she made an inter vivos donation of her entire interest in the
home to Avrel. See La. Civ. Code art. 1468. Avrel then executed the mortgage
agreement with Wells Fargo. 1
      On May 11, 2012, Avrel refinanced the HECM loan with Generation
Mortgage Company. Avrel signed the mortgage as the borrower, and Evelyn
signed “solely for the purpose of consenting to the encumbrance of, and waiving
any homestead and/or community property rights in, the described Property,”
without “assuming any personal liability for payment of the debt secured
hereby.” Avrel died on May 16, 2014, and one week later, Generation notified
Evelyn that the entire balance of the loan was due within 30 days, effectively
resulting in her eviction from the property.
      Jeansonne filed suit against Wells Fargo, Bayou Title Company, and
Generation Mortgage in state court. Wells Fargo removed to the Eastern
District of Louisiana. The district court dismissed all claims under Rule
12(b)(6). 2 Jeansonne appeals only the dismissal of her claims against
Generation Mortgage.
                                            I.
      We review a dismissal under Rule 12(b)(6) de novo. In re Katrina Canal
Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007). We accept “all well-pleaded
facts as true, viewing them in the light most favorable to the plaintiff.” Id.
(internal quotation marks omitted). In order to survive a Rule 12(b)(6) motion
to dismiss, the plaintiff must plead “enough facts to state a claim to relief that
is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

      1  Two months earlier, the Jeansonnes had attended a mandatory HECM counseling
session where Evelyn signed an acknowledgment as a non-borrowing spouse that “[i]f the
borrowing spouse or resident predeceases you . . . the reverse mortgage will become due and
payable.”
       2 The district court found that the claims against Wells Fargo and Bayou Title had

prescribed under state law.
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                                     No. 15-30706
“Factual allegations must be enough to raise a right to relief above the
speculative level on the assumption that all the allegations in the complaint
are true (even if doubtful in fact).” Id. at 555 (citation omitted).
                                            II.
       Jeansonne first argues that Generation violated HUD regulations by
foreclosing on the home while she still resided in it. Jeansonne cites 12 U.S.C.
§ 1715z-20(j) in support, which states that “[t]he [Secretary of Housing and
Urban Development] may not insure a home equity conversion mortgage under
this section unless such mortgage provides that the homeowner’s obligation to
satisfy the loan obligation is deferred until the homeowner’s death, the sale of
the home, or the occurrence of other events specified in regulations of the
Secretary,” and “[f]or purposes of this subsection, the term ‘homeowner’
includes the spouse of a homeowner.” As the district court correctly noted, this
provision prevents HUD from insuring reverse mortgages that fail to protect a
surviving spouse who continues to reside in the home after the death of the
borrowing spouse. And while HUD may have violated § 1715z-20(j) by insuring
a reverse mortgage that failed to protect Evelyn Jeansonne as the non-
borrowing spouse, see, e.g., Bombet v. Donovan, No. 13-118, 2015 WL 1276555,
at *5 (M.D. La. Mar. 19, 2015), this would not affect Generation’s right to
foreclose under the terms of the contract it executed with Avrel Jeansonne.
       Jeansonne also argues that § 1715z-20(j) comprised an implied term of
the HECM contract between Generation and her husband. In support,
Jeansonne cites cases where the displaced spouse was a borrower. 3 Here,

       3 Smith v. Reverse Mortgage Sols., Inc., No. 3D13-2261, 2015 WL 4257632, at *3 (Fla.
Dist. Ct. App. July 15, 2015); Kostopoulos v. Onewest Bank, FSB, 60 F. Supp. 3d 804, 805–06
(E.D. Mich. 2014).

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                               No. 15-30706
Jeansonne was a non-borrowing spouse and was therefore not a mortgagor
under the contract. Thus, Generation was free to foreclose after the death of
the only borrower under the agreement. See Plunkett v. Castro, 67 F. Supp. 3d
1, 19 (D.D.C. 2014); Bombet, 2015 WL 1276555, at *5.
                                    III.
     Because Jeansonne, as a non-borrowing spouse, has failed to state a
plausible claim for relief, the district court properly dismissed under Rule
12(b)(6). AFFIRMED.

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