State v. Terry Lee Kerr v. Reconstrust ( 2014 )

IN THE COURT OF APPEALS OF THE STATE OF IDAHO
Docket No. 41670
TERRY LEE KERR, ) 2014 Unpublished Opinion No. 829
)
Plaintiff-Appellant, ) Filed: November 25, 2014
)
v. ) Stephen W. Kenyon, Clerk
)
RECONTRUST COMPANY N.A. and ) THIS IS AN UNPUBLISHED
BANK OF AMERICA, N.A., ) OPINION AND SHALL NOT
) BE CITED AS AUTHORITY
Defendants-Respondents. )
)
Appeal from the District Court of the Sixth Judicial District, State of Idaho,
Bannock County. Hon. Stephen S. Dunn, District Judge.
Order granting motion to dismiss, affirmed.
Terry Lee Kerr, Idaho Falls, pro se appellant.
Givens Pursley LLP; Kelly Greene McConnell and Amber N. Dina, Boise, for
respondents.
________________________________________________
GRATTON, Judge
Terry Lee Kerr appeals from the district court’s order dismissing several statutory and
common law claims he had made regarding the foreclosure and trustee’s sale of a property
located in Ammon, Idaho.
I.
FACTUAL AND PROCEDURAL BACKGROUND
Jerry Jones obtained a loan secured by a deed of trust on property in Ammon, Idaho,
which is the focus of this litigation. Subsequently, Jones executed a quitclaim deed naming Kerr
and Kerr’s son as recipients of one-half interest in the property. He also executed a power of
attorney granting Kerr the authority to discuss loans with mortgage companies. The quitclaim
deed was recorded several years later, following foreclosure proceedings that were initiated by
defendants, Bank of America and ReconTrust. Defendant ReconTrust, the successor trustee,
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executed a notice of default on the loan secured by the Ammon property, and a notice of the
trustee’s sale was published and also mailed to Jones.
Kerr filed a complaint challenging the sale of the Ammon property on a number of
grounds, including: (1) a claim for violation of the Fair Debt Collection Practices Act, the
Deceptive Trade Practice Act, and the Privacy Act; (2) violation of the Idaho Consumer
Protection Act; (3) intentional interference with a prospective economic advantage; (4) bad faith
resulting in the infliction of emotional and financial distress; (5) civil conspiracy; (6) a repeat of
the second claim under the Idaho Consumer Protection Act; and (7) defamation. 1 Kerr alleged
that defendants and their attorneys engaged in a conspiracy to retaliate against him for having
filed a prior lawsuit against Bank of America, 2 which was also appealed to this Court several
years ago. In addition, Kerr is currently involved in another litigation relating to the trustee’s
sale of property owned by his son in Nevada.
Defendants subsequently moved to dismiss all claims on various grounds. At Kerr’s
request, the presiding district judge disqualified himself as did the second district judge. Kerr
was then granted a change of venue and the third district judge assigned to this case granted
defendants’ motion to dismiss. Kerr filed a motion to reconsider, which was denied. He timely
appeals.
II.
ANALYSIS
As an appellate court, we will affirm a trial court’s grant of an Idaho Rule of Civil
Procedure 12(b)(6) motion where the record demonstrates that there are no genuine issues of
material fact and the case can be decided as a matter of law. Coghlan v. Beta Theta Pi
Fraternity, 133 Idaho 388, 398, 987 P.2d 300, 310 (1999). When reviewing an order of the
district court dismissing a case pursuant to I.R.C.P. 12(b)(6), the nonmoving party is entitled to
have all inferences from the record and pleadings viewed in its favor, and only then may the
1
The district court went to great lengths to decipher what claims were actually being
made. Kerr does not allege that the district court’s characterization of these claims was
erroneous.
2
Terry Lee Kerr v. Bank of America, Idaho, N.A., Docket No. 37754 (Ct. App.
November 22, 2011) (unpublished).
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question be asked whether a claim for relief has been stated. Coghlan, 133 Idaho at 398, 987
P.2d at 310. The issue is not whether the plaintiff will ultimately prevail, but whether the party
is entitled to offer evidence to support the claims. Orthman v. Idaho Power Co., 126 Idaho 960,
962, 895 P.2d 561, 563 (1995).
A. Fair Debt Collection Practices Act, Deceptive Trade Practice Act, and Privacy Act
Kerr alleges the district court erred when it dismissed his claims that the defendants
violated the Fair Debt Collection Practices Act, Deceptive Trade Practice Act, and the Privacy
Act on the basis that the claim failed to put the defendants on notice as to what claim was being
brought, and on the alternative basis that the claim was barred by res judicata. On appeal, Kerr
does not specify how the district court erred in this regard other than stating that there were
violations of the Acts.
First, we agree with the district court that Kerr has failed to meet the notice requirements
as to these claims. No citation is made to any of the alleged statutes. It is true that our pleading
standards only require a plaintiff to make a short, plain statement that sufficiently puts the
adverse party on notice of the claims brought against it. I.R.C.P. 8(a)(1); Brown v. City of
Pocatello, 148 Idaho 802, 807, 229 P.3d 1164, 1169 (2010). However, even under this liberal
standard, simply stating that the defendants violated these acts, without more, does not narrow
the possibility of a violation to any one or even a few of several potentially applicable statutes. It
provides no notice of the claims under Idaho law that defendants would be subject to or the
defenses available. It is not possible to determine what facts would be sufficient to sustain a
claim under the alleged statutes.
Second, res judicata prevents the litigation of causes of action which were finally decided
in a previous suit. Grubler by and Through Grubler v. Brydon, 125 Idaho 107, 110, 867 P.2d
981, 984 (1994). See also Magic Valley Radiology P.A. v. Kolouch, 123 Idaho 434, 436, 849
P.2d 107, 109 (1993); Diamond v. Farmers Group, Inc., 119 Idaho 146, 150, 804 P.2d 319, 323
(1990). As a general proposition, res judicata prevents litigants who were parties in a prior
action and those in privity with them from bringing or having to defend a claim arising from the
transaction or series of transactions giving rise to the first suit. Grubler, 125 Idaho at 110, 867
P.2d at 984. The review of a trial court’s ruling on whether an action is barred by res judicata is
a question of law over which this Court has de novo review. Wolfe v. Farm Bureau Ins. Co., 128
Idaho 398, 403, 913 P.2d 1168, 1173 (1996).
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Res judicata is an affirmative defense that requires the court to look beyond the
pleadings. For this reason, the district court treated the defense as a motion for summary
judgment. We first note that summary judgment under I.R.C.P. 56(c) is proper only when there
is no genuine issue of material fact and the moving party is entitled to judgment as a matter of
law. On appeal, we exercise free review in determining whether a genuine issue of material fact
exists and whether the moving party is entitled to judgment as a matter of law. Edwards v.
Conchemco, Inc., 111 Idaho 851, 852, 727 P.2d 1279, 1280 (Ct. App. 1986). When assessing a
motion for summary judgment, all controverted facts are to be liberally construed in favor of the
nonmoving party. Furthermore, the trial court must draw all reasonable inferences in favor of
the party resisting the motion. G & M Farms v. Funk Irrigation Co., 119 Idaho 514, 517, 808
P.2d 851, 854 (1991); Sanders v. Kuna Joint School Dist., 125 Idaho 872, 874, 876 P.2d 154,
156 (Ct. App. 1994).
For claim preclusion to bar a subsequent action there are three requirements: (1) same
parties; (2) same claim; and (3) final judgment. Ticor Title Co. v. Stanion, 144 Idaho 119, 124,
157 P.3d 613, 618 (2007). As the district court found, Kerr is asserting a nearly identical claim
as brought in the first litigation and addressed by this Court. Moreover, Kerr has not claimed in
this appeal that the district court was wrong in determining that the claims were substantially the
same. Although ReconTrust was not named as a defendant in the prior litigation, it is a
successor trustee and can raise defenses asserted in the prior case. There was a final judgment on
these issues. The elements of res judicata have been met and Kerr is prohibited from re-litigating
the issue in the instant case.
B. Idaho Consumer Protection Act
Kerr asserts the defendants violated the Idaho Consumer Protection Act by failing to
implement a loan modification. In order to have standing under the Idaho Consumer Protection
Act (ICPA), I.C. §§ 48-601 through 48-619, the aggrieved party must have been in a contractual
relationship with the party alleged to have acted unfairly or deceptively. Taylor v. McNichols,
149 Idaho 826, 846, 243 P.3d 642, 662 (2010). “[A] claim under the ICPA must be based upon a
contract.” Haskin v. Glass, 102 Idaho 785, 788, 640 P.2d 1186, 1189 (Ct. App. 1982). Kerr
does not allege that he entered into a contractual relationship with defendants. Rather, he asserts
the power of attorney he was granted from Jones gives him standing; however, the agreement he
references is a limited power of attorney which allows him only to talk to mortgage companies
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having to do with the home and does not grant him the power to assert a contractual relationship
on behalf of Jones. Therefore, the district court correctly dismissed claims two and six on this
basis.
C. Intentional Interference with a Prospective Economic Advantage
Kerr alleged Bank of America intentionally interfered with a prospective economic
advantage; however, his argument appears to be related to his son’s property in Nevada. The
district court correctly limited the scope of this litigation to the Ammon property, due to its lack
of jurisdiction over the Nevada claims and because Kerr is already involved in parallel litigation
in Nevada relating to the property. To establish a claim for intentional interference with a
prospective economic advantage, the plaintiff must show: (1) the existence of a valid economic
expectancy; (2) knowledge of the expectancy on the part of the interferer; (3) intentional
interference inducing termination of the expectancy; (4) the interference was wrongful by some
measure beyond the fact of the interference itself; and (5) resulting damage to the plaintiff whose
expectancy has been disrupted. Wesco Autobody Supply, Inc. v. Ernest, 149 Idaho 881, 893, 243
P.3d 1069, 1081 (2010). Kerr does not allege he had any economic expectancy regarding the
Ammon property, nor does he allege that the defendants had any knowledge of an alleged
expectancy. This is supported by the fact that he failed to record the quitclaim deed from Jones
providing Kerr and Kerr’s son one-half interest in the property until after foreclosure
proceedings had commenced. Further, there is no evidence that the defendants’ actions in
enforcing the mortgage agreement were wrongful. For these reasons, the district court did not
err when dismissing Kerr’s claim for intentional interference with a prospective economic
advantage regarding the Ammon property.
D. Bad Faith Resulting in the Infliction of Emotional and Financial Distress
Kerr alleged bad faith resulting in the infliction of emotional and financial distress.
Claims of bad faith can be brought under contract law and also under tort law in insurance cases.
White v. Unigard Mut. Ins. Co., 112 Idaho 94, 97, 730 P.2d 1014, 1017 (1986). Clearly a claim
brought under contract law would require a contractual relationship between the parties.
Because Kerr does not have a contractual relationship with defendant as previously discussed
and the defendants are not insurance companies, the district court correctly dismissed the fourth
claim as far as it is derivative of a bad faith claim.
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While it is not entirely clear, if he alternatively is making a claim for intentional infliction
of emotional distress that is not derived from a bad faith claim, he must prove the following
elements: (1) that the defendant acted intentionally or recklessly; (2) that the defendant’s
conduct was extreme and outrageous; (3) that there was a causal connection between the
defendant’s conduct and the plaintiff’s emotional distress; and (4) that the plaintiff’s emotional
distress was severe. Alderson v. Bonner, 142 Idaho 733, 739, 132 P.3d 1261, 1267 (Ct. App.
2006). In this case, Kerr does not allege that Jones was current on his loan to Bank of America
or that Bank of America’s conduct was reckless, extreme, or outrageous in commencing
foreclosure proceedings based on its rights under the mortgage contract. Kerr does make several
conclusory allegations regarding wrongdoing, such as political corruption and violence against
his family, but he alleges no facts indicating that the defendants committed any of this alleged
wrongdoing. For these reasons, the district court correctly dismissed this claim.
E. Civil Conspiracy
Kerr asserts the defendants have engaged in a civil conspiracy against him. “A civil
conspiracy that gives rise to legal remedies exists only if there is an agreement between two or
more to accomplish an unlawful objective or to accomplish a lawful objective in an unlawful
manner.” Wesco, 149 Idaho at 898, 243 P.3d at 1086 (quoting McPheters v. Maile, 138 Idaho
391, 395, 64 P.3d 317, 321 (2003)). “The essence of a cause of action for civil conspiracy is the
civil wrong committed as the objective of the conspiracy, not the conspiracy itself.” Id. Further,
there must be specific evidence of a plan or agreement to demonstrate the existence of the
conspiracy at the time the allegedly unlawful objective was accomplished. Id. at 898-99, 243
P.3d at 1086-87. Kerr asserts he has documented the conspiracy with specificity; however, a
review of the record does not provide specific evidence of a plan or what civil wrong was
committed. To the extent he argues that the defendants failed to implement a loan modification
properly, this argument fails since, as noted above, Kerr does not have a contractual relationship
with the defendants and the limited power of attorney he was granted does not give him the
authority to bring these arguments on behalf of Jones.
F. Defamation
Kerr argues Bank of America defamed him by initiating a wrongful trustee’s sale of the
Ammon property and by wrongly claiming he owned the property in Nevada. For the reasons
previously stated, this Court agrees with the district court’s ruling that this case is limited to the
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claims relating to the Ammon property. In a defamation action, a plaintiff must prove that: (1)
the defendant communicated information concerning the plaintiff to others; (2) the information
was defamatory; and (3) the plaintiff was damaged because of the communication. Clark v. The
Spokesman-Review, 144 Idaho 427, 430, 163 P.3d 216, 219 (2007). Kerr’s argument appears to
be based on the publication of the notice of trustee’s sale of the Ammon property. A trustee’s
sale was initiated; therefore, the statement was not false or defamatory. Furthermore, the
foreclosure proceedings were against Jones; thus, the pursuit of the foreclosure would have not
damaged Kerr since any interest he had in the property was not of record until after the
foreclosure proceedings began. Kerr fails to allege the elements of defamation and for this
reason the district court correctly dismissed his claims for defamation.
E. Motion for Sanctions
Kerr asserts a variety of wrongdoing within the litigation, including wrongdoing on the
part of Bank of America’s attorneys. He alleges that the district court abused its discretion by
not acting upon motions for sanctions. However, Kerr did not include the motions in the
appellate record and, moreover, provided no specific reference to the record or argument and
citation to authority in his opening brief in support of the claim. We, thus, affirm the district
court as to any claim of abuse of discretion regarding motions for sanctions. See I.A.R. 35(a)(6);
Bach v. Bagley, 148 Idaho 784, 790, 229 P.3d 1146, 1152 (2010); Jorgensen v. Coppedge, 145
Idaho 524, 528, 181 P.3d 450, 454 (2008).
III.
CONCLUSION
This Court finds the district court did not err by dismissing the claims made by Kerr and
therefore, the judgment of the district court is affirmed.
Chief Judge GUTIERREZ and Judge LANSING CONCUR.
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