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Grant v. United States

United States District Court, S.D. Indiana, Indianapolis Division

September 3, 2014




This cause is before the Court on Defendant's Motion to Dismiss, or, in the Alternative, Motion for Summary Judgment [Docket No. 18], filed on January 3, 2014 pursuant to Federal Rules of Civil Procedure 12(b)(6) and 56. For the reasons set forth below, the motion is GRANTED.

Factual Background

Plaintiff Kimberly Grant is a resident of Indiana. This suit arises out of her dealings with Defendant United States Department of Housing and Urban Development (HUD), from whom she contracted to purchase a house in Indianapolis.

On May 8, 2012, Plaintiff signed a contract to buy a house owned by HUD at 9734 East 10th Street, Indianapolis. The purchase price was $60, 100, and Plaintiff paid $1, 000 in earnest money on signing the contract. Pl.'s Ex. C; Def.'s Ex. 1.The parties also executed a "lead-based paint addendum, " reciting that Plaintiff was allowed 15 days from the date that HUD accepted the purchase contract to withdraw from the contract and recover her earnest money, if an accredited inspection detected the presence of lead paint in the house. Def.'s Ex. 2.[1] Because the property was being sold subject to FHA insured financing, the parties agreed that it would fall to HUD to procure a lead-based paint inspection and make Plaintiff aware of the results. Id. at 1-2. HomeTelos, LP ("HomeTelos"), HUD's "asset manager" with responsibility for the marketing and disposition of its properties, accepted this contract a week later, on May 15, 2012. Bonelli Decl. § 15.[2]

On that same date, HomeTelos referred the contract to its closing agent, Hocker & Associates ("Hocker"), to perform a title search before closing. Id. at ¶ 16. On May 23, 2012, Hocker reported to HomeTelos that a title search had revealed the existence of a mortgage not reflected in the deed. Id. at ¶ 17; Simms Decl. ¶¶ 8-10. Apparently because of the unresolved title issue, the parties agreed to three extensions of the closing date, with the final extension setting the date at August 13, 2012. Bonelli Decl. at ¶¶ 19-21. According to Defendant, the title issue was resolved on or around August 8, 2012. Id. at ¶ 22.

HUD had contracted with Asset Management Specialists ("AMS") to be the agency's "field service managers" for the 10th Street house and others-an agreement that gave AMS responsibility for the physical preservation and protection of HUD-owned properties. See Id. at ¶¶ 23-24. HUD also contracted with the firm, Chinye-EBS Evaluation JV ("Chinye"), to perform the lead-based paint inspection required by the addendum to the home purchase contract. On May 16, 2012, AMS ordered the lead-based paint inspection of the 10th Street house, and Chinye performed it on May 22. Id. at ¶¶ 31-32. The inspection revealed that leadbased paint was present in the house, and HomeTelos subsequently requested a "lead-based paint stabilization plan" from AMS, as required by the home purchase contract. See id. at ¶ 33; Def.'s Ex. 2. ("Upon contract execution HUD will procure a lead-based paint inspection... along with a paint stabilization plan and cost estimate if deteriorated lead-based paint is found...."). The lead issue prompted Plaintiff's broker to request an additional extension of the closing date, which HomeTelos accepted, resetting the closing to August 28, 2012. Id. at ¶ 34. On August 24, 2012, an AMS subcontractor performed the "lead-based paint stabilization, " and Chinye conducted a follow-up inspection thereafter. Id. at ¶ 35. Later, Plaintiff's broker requested an extension of the closing date to September 12, 2012; according to Defendant, HomeTelos received the final lead clearance report on August 29 and thus stood ready to close as of that date. Id. at ¶¶ 36-37.

However, Plaintiff ultimately did not go through with the purchase. On September 13, 2012, she signed a release form stating as follows: "Purchaser and seller do not intend to consummate the contract described above, and hereby agree to mutually release each other from any and all obligations, liabilities, and claims arising from the execution of the contract." Def.'s Ex. 6 ("Contract Release and Earnest Money Disposition Request Form"). According to Plaintiff, she was forced to withdraw from the sale because the delays occasioned by the title and lead paint issues had caused her to lose her loan approval. Compl. ¶ 7.[3] HomeTelos accepted Plaintiff's release, and it returned Plaintiff's $1000 earnest deposit to her. Def.'s Ex. 6.

Plaintiff filed a Notice of Federal Tort Claim with HUD on October 11, 2012; in it, she disclosed her intent to sue on the basis that her "previously approved loan was denied, " causing her to "lose [the] sale of [the] home and suffer mental anguish." Pl.'s Ex. 1. On April 3, 2013, HUD responded, denying her claim for $110, 100.00 and advising her of her right to file a civil suit within six months. Pl.'s Ex. 2. She filed this timely complaint on June 19, 2013.

Legal Analysis

Standard of Review

Defendant moves to dismiss Plaintiff's two counts for failure to state a claim or lack of subject-matter jurisdiction under Federal Rule of Civil Procedure 12. In the alternative, it seeks summary judgment as to each claim pursuant to Federal Rule of Civil Procedure 56(a).

Because Plaintiff filed her complaint without the assistance of counsel, we construe its contents with still greater liberality than that normally afforded to plaintiffs. See Wynn v. Southward, 251 F.3d 588, 592 (7th Cir. 2001) ...

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