Sharleen Jeanbaptiste v. Wells Fargo Bank, N.A. ( 2014 )


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  •      Case: 14-10671      Document: 00512829906         Page: 1    Date Filed: 11/07/2014
    IN THE UNITED STATES COURT OF APPEALS
    FOR THE FIFTH CIRCUIT
    United States Court of Appeals
    No. 14-10671
    Fifth Circuit
    FILED
    Summary Calendar                      November 7, 2014
    Lyle W. Cayce
    Clerk
    SHARLEEN O. JEANBAPTISTE,
    Plaintiff–Appellant
    v.
    WELLS FARGO BANK, N.A.,
    Defendant–Appellee
    Appeal from the United States District Court
    for the Northern District of Texas
    USDC No. 3:14-CV-264
    Before PRADO, OWEN, and GRAVES, Circuit Judges.
    PER CURIAM:*
    Sharleen Jeanbaptiste challenges the district court’s grant of Wells
    Fargo Bank’s (Wells Fargo) motion to dismiss on the grounds that: (1) her
    claims are not time-barred; (2) she was not granted an opportunity to amend
    her complaint; and (3) she stated claims upon which relief could be granted.
    As her claims are barred by statutes of limitation, we affirm.
    * 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 R. 47.5, the court has determined that this opinion should not
    be published and is not precedent except under the limited circumstances set forth in 5TH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.
    Case: 14-10671        Document: 00512829906        Page: 2    Date Filed: 11/07/2014
    No. 14-10671
    I
    Jeanbaptiste bought a home during the summer of 2000 with a mortgage
    loan. Wells Fargo later became the mortgage servicer on the loan. After
    Jeanbaptiste began struggling financially, she and the bank entered into two
    successive loan modification agreements; she continued to make payments
    during this time. In 2008, Wells Fargo informed her that it was unable modify
    the loan a third time and advised her to contact the bank to “discuss [her]
    options.” In December of that year, she temporarily moved to Louisiana “to
    care for her terminally-ill mother” and, while there, continued efforts to modify
    her loan. Despite these efforts, in June of 2009, Wells Fargo foreclosed on
    Jeanbaptiste’s home. In October, a friend who “happened to be driving by and
    observed someone removing items from the residence . . . immediately
    contacted Ms. Jeanbaptiste to inform her.” Two years later, in December of
    2011, she received notification from the Board of Governors of the Federal
    Reserve that it was reviewing whether Wells Fargo had improperly foreclosed
    on her home. She filed suit in state court against Wells Fargo on December
    18, 2013, alleging breach of contract, wrongful foreclosure, civil theft under the
    Texas Theft Liability Act (TTLA), 1 and conversion. Wells Fargo removed the
    case to federal court and filed a motion to dismiss. The magistrate judge
    recommended dismissal because Jeanbaptiste’s complaint was time-barred
    and failed to state a claim upon which relief could be granted. The district
    judge adopted these recommendations, and we now affirm on grounds that the
    claims are barred under the relevant statutes of limitation.
    1   TEX. CIV. PRAC. & REM. CODES ANN. § 134.003, .005 (West 2013).
    2
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    II
    We review de novo a district court’s grant of a motion to dismiss under
    Rule 12(b)(6). 2 We accept “all well-pleaded facts as true, viewing them in the
    light most favorable to the plaintiff.” 3
    A federal court exercising diversity jurisdiction must apply appropriate
    state law, including state statutes of limitation, to resolve a dispute. 4 To
    determine state law, a federal court “look[s] to the final decisions of the state’s
    highest court.” 5 Where no such precedent is available, a federal court must
    employ state methodology to make an “Erie guess” to “determine, in its best
    judgment, how the highest court of the state would resolve the issue if
    presented with the same case.” 6 It is undisputed that Texas law applies in this
    case.
    III
    In Texas, under the “injury rule,” unless an exception applies, “a cause
    of action generally accrues when a wrongful act causes a legal injury regardless
    of when the plaintiff discovers the injury or if all resulting damages have not
    yet occurred.” 7 A four-year statute of limitations applies to breach of contract 8
    2   In re Katrina Canal Breaches Litig., 
    495 F.3d 191
    , 205 (5th Cir. 2007).
    3   
    Id. (citations and
    internal quotation marks omitted).
    Guar. Trust Co. of N.Y. v. York, 
    326 U.S. 99
    , 111 (1945); Erie R.R. Co. v. Tompkins,
    4
    
    304 U.S. 64
    , 78-79 (1938).
    5Lawyers Title Ins. Corp. v. Doubletree Partners, L.P., 
    739 F.3d 848
    , 856 (5th Cir.
    2014) (quoting Am. Int’l Specialty Lines Ins. Co. v. Canal Indem. Co., 
    352 F.3d 254
    , 260 (5th
    Cir. 2003)).
    6   
    Id. 7Holland v.
    Thompson, 
    338 S.W.3d 586
    , 593 (Tex. App.—El Paso 2010, pet. denied)
    (citing Childs v. Haussecker, 
    974 S.W.2d 31
    , 36 (Tex. 1998)).
    8   TEX. CIV. PRAC. & REM. CODE ANN. § 16.004 (West 2013).
    3
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    and wrongful foreclosure 9 claims. A two-year limitations period applies to
    conversion 10 and TTLA 11 claims. Thus, as Jeanbaptiste’s injuries occurred at
    the latest in June of 2009, when Wells Fargo foreclosed, and she did not bring
    her claim until December of 2013, all of her claims are time-barred.
    Jeanbaptiste nevertheless contends that the “discovery rule,” a narrow
    exception to the injury rule, tolled the statute of limitations such that her suit
    can move forward. We disagree.
    The discovery rule exception applies only if:
    the nature of the plaintiff’s injury is both inherently
    undiscoverable and objectively verifiable. An injury is inherently
    undiscoverable if it is, by its nature, unlikely to be discovered
    within the prescribed limitations period despite due diligence.
    “Inherently discoverable” does not mean that a particular plaintiff
    did not discover his or her particular injury within the applicable
    limitations period. Instead, we determine whether an injury is
    inherently undiscoverable on a categorical basis because such an
    approach brings predictability and consistency to the
    jurisprudence. 12
    The discovery rule does not apply to breach of contract 13 or conversion 14 claims.
    While the Supreme Court of Texas has not yet addressed the application of the
    discovery rule to wrongful foreclosure and TTLA claims, Texas courts of appeal
    9 Gonzales v. Lockwood Lumber Co., 
    668 S.W.2d 813
    , 815 (Tex. App.—Houston [14th
    dist.] 1984, writ ref’d n.r.e.) (citing Int’l Printing Pressmen and Assistants’ Union of N. Am.
    v. Smith, 
    198 S.W.2d 729
    , 735 (Tex. 1946)).
    10   TEX. CIV. PRAC. & REM. § 16.003(a).
    11 
    Id. § 134.003,
    .005; see Howard v. Sony Music BMG Entm’t, 293 F. App’x 350, 352
    (5th Cir. 2008) (per curiam).
    12Wagner & Brown, Ltd. v. Horwood, 
    58 S.W.3d 732
    , 734 (Tex. 2001) (citations and
    internal quotation marks omitted); see Priester v. JP Morgan Chase Bank, N.A., 
    708 F.3d 667
    , 675 (5th Cir. 2013).
    13   Via Net v. TIG Ins. Co., 
    211 S.W.3d 310
    , 315 (Tex. 2006) (per curiam).
    14Rogers v. Ricane Enters., Inc., 
    930 S.W.2d 157
    , 167 (Tex. App.—Amarillo 1996, writ
    denied), cited with approval in HECI Exploration Co. v. Neel, 
    982 S.W.2d 881
    , 888 (Tex.
    1998).
    4
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    have uniformly refused to apply the discovery rule to them. 15                   Accordingly,
    the district court did not err in dismissing Jeanbaptiste’s suit with prejudice
    because her claims are time-barred.
    *        *        *
    For the foregoing reasons, the judgment of the district court is
    AFFIRMED.
    15 E.g., Trunkhill Capital, Inc. v. Jansma, 
    905 S.W.2d 464
    , 468 (Tex. App.–—Waco
    1995, writ denied) (“The creditor’s cause of action for any deficiency exists on the date of
    foreclosure.”); Nabelek v. Bradford, No. 14-01-00240-CV, 
    2002 WL 1438662
    , at *3 & n.3, *5
    (Tex. App.–—Houston Aug. 22, 2002) (“While it is perhaps probable that a reasonably diligent
    person whose property had been seized would not know of his injury as of [the date of seizure],
    we cannot say that he would continue to remain unaware of that failure for a period of two
    years thereafter.”); see also Howard v. Sony BMG Music Entm’t, No. H-06-3133-CV, 
    2007 WL 2537865
    , at *3-4 (S.D. Tex. Aug. 31, 2007), aff’d, 293 F. App’x 350 (5th Cir. 2008) (per curiam).
    5