David L. White Plaintiff- Appellant
CitiMortgage, Inc. Defendant-Appellee
Submitted: January 11, 2017
from United States District Court for the Western District of
Missouri - Kansas City
RILEY,  Chief Judge, LOKEN and BENTON,
White thought he had saved his house from foreclosure. He
paid the mortgage servicer, CitiMortgage, Inc., thousands of
dollars to undo a sale to the Federal Home Loan Mortgage
Corporation (Freddie Mac) and to let White continue paying
off his debt. Thereafter he paid many thousands more on the
statements CitiMortgage resumed sending him each month. Yet
when White tried to sell the house five years later, he
discovered he did not own it, Freddie Mac did-it turns out
the title was never actually transferred back to White after
the foreclosure sale and White's reinstatement payment.
The district court ruled it was too late for White to sue
CitiMortgage for misleading him, because, as fate would have
it, five years is also the governing statute of limitations.
See Mo. Rev. Stat. § 516.120. The limitation
clock had been running the whole time, according to the
district court, because White could and should have checked
with the county recorder to make sure his title was restored
after he made the reinstatement deal with CitiMortgage. We
reverse and remand.
refinanced his house in 2003. By early 2008, Freddie Mac had
acquired the debt, CitiMortgage was servicing it, and White
was in default. CitiMortgage notified White and held a
foreclosure sale, which White did not attend. Freddie Mac
made the winning bid, equal to the amount necessary to pay
off the loan, just over $90, 000. The deed transferring title
to Freddie Mac was recorded in Jackson County, Missouri, on
April 7, 2008. Three days later, Freddie Mac began eviction
two months later, in June, White reached an oral agreement
with CitiMortgage to pay roughly $6, 600 to
"reinstate" the debt so he could continue living in
the house. Freddie Mac acquiesced and dropped its efforts to
evict White. Freddie Mac, as did White and at least some of
the CitiMortgage employees involved in the transaction,
assumed CitiMortgage would take the necessary steps to
rescind the deed and restore White's title. For unknown
reasons, CitiMortgage failed to do so.
also failed to apply White's "reinstatement"
payment to the loan right away. By the time CitiMortgage
processed the $6, 600, it was no longer enough to bring the
debt current. Treating the shortfall as a trigger for
"loss mitigation options, " CitiMortgage then
approached White about modifying his loan. White and
CitiMortgage's agent signed a modification agreement in
October 2008. The modification unquestionably was premised on
White again owning the house. Among other things, the
agreement-which CitiMortgage prepared and presented to
White-provided that the original deed of trust securing the
loan "shall remain in full force and effect, "
necessarily presupposing that the subsequent
"Trustee's Deed Under Foreclosure" reflecting
the sale to Freddie Mac had not overridden the original trust
deed. More fundamentally, there simply would have been no
reason for such a transaction (or, for that matter, for
CitiMortgage to continue dealing with White at all) if the
foreclosure were complete and effective, extinguishing the
debt, and the house belonged to Freddie Mac.
fall of 2013, White moved and decided to sell the house. His
realtor ran a title search and discovered White was not the
record owner. By then, White had paid almost $90, 000 on the
modified loan. White sued CitiMortgage in Missouri state
court in late January 2014. Freddie Mac intervened and
removed the case to federal court, see 12 U.S.C.
§ 1452(f)(3), seeking an order setting aside the deed
from the foreclosure sale and enforcing the modified loan-in
other words, judicial permission to proceed as if everything
happened the way it was supposed to occur. White resisted
Freddie Mac's proposed disposition, arguing the
circumstances had changed and he now wanted money damages,
not the house. White ultimately pled four counts: fraud,
"negligent inducement/negligent non-disclosure, "
"constructive fraud/restitution, " and
"violation of the Missouri Merchandising Practices
Act" (MMPA), Mo. Rev. Stat. § 407.020(1).
cross-motions for summary judgment, the district court held
White's claims were all time-barred, without addressing
the merits. Citing Federal Rule of Civil Procedure
41(a)(1)(A)(ii) and (c), the parties then agreed to have
Freddie Mac's claims dismissed with prejudice. The
district court entered an order to that effect.Having disposed of
all the parties and claims in the case, the district court
also entered final judgment, from which White appeals.
See 28 U.S.C. § 1291 (appellate jurisdiction).
review the grant of summary judgment de novo. See,
e.g., Johnson v. Blaukat, 453 F.3d 1108,
1112 (8th Cir. 2006). See generally Fed.R.Civ.P.
56(a). The parties agree White's claims are all subject
to a five-year statute of limitations. See Mo. Rev.
Stat. § 516.120; see also, e.g.,
Klemme v. Best, 941 S.W.2d 493, 497 (Mo. 1997)
("Section 516.120(4) does apply to claims of breach of
fiduciary duty or constructive fraud."); Royal
Forest Condo. Owners's Ass'n v. Kilgore, 416
S.W.3d 370, 373 (Mo.Ct.App. 2013) ("An action for unjust
enrichment is . . . subject to the five-year statute of
limitations in Section 516.120(1)."). The dispute is
over whether the five years started running-in the summer or
fall of 2008, or the fall of 2013.
claims accrue "when the damage . . . is sustained and is
capable of ascertainment." Mo. Rev. Stat. §
516.100. As White points out on appeal, Missouri law provides
a more forgiving standard for "action[s] for relief on
the ground of fraud, " which are "deemed not to
have accrued until the discovery . . . of the facts
constituting the fraud." Mo. Rev. Stat. §
516.120(5). We can ignore that exception, and need not parse
which of White's claims it covers, cf. Huffman v.
Credit Union of Tex., 758 F.3d 963, 968-69 (8th Cir.
2014) ("[T]he five-year statute of limitations for a
narrow subclass of MMPA claims-those based on allegations of
'fraud'-may be governed by ...