DC Judge’s Troublesome Final Order to Homeowner: Res Judicata Applies n’ You’re Time-Barred as Well

ORDER

This Order serves to address the dismissal of Plaintiff Karen Richardson’s claims in the instant matter based on res judicata in this Court’s September 28, 2022 Order Granting Dismissal and December 7, 2022 Granting in Part Motion for Reconsideration.

On September 26, 2024, the District of Columbia Court of Appeals reversed and remanded this Court’s dismissal of Plaintiff’s claims on the limited issue of privity and remanded for further proceedings consisting with its Opinion (“DCCA Opinion”).

Additionally before the Court is Defendants McCabe, Weisberg Conway LLC (“MWC”), Laura H.G. O’Sullivan, Trustee (“Trustee O’Sullivan”), and Chasity Brown, Trustee’s (“Trustee Brown”) (collectively “Defendants”) Renewed Motion to Dismiss Second Amended Complaint (“Motion”), filed on October 15, 2024.1 Plaintiff filed an Opposition (“Opposition”) on November 6, 2024, and Defendants filed their Reply (“Reply”) on November 19, 2024.

For the foregoing reasons, the Court’s September 28, 2022 dismissal of Plaintiff’s claims is AFFIRMED and Defendants’ Renewed Motion to Dismiss is DENIED AS MOOT.

1 Defendants note in their Motion that “[w]hile undersigned counsel does not represent the other defendants, Moynihan, Shaffer and Clarke, counsel does note that service was not properly made on them at MWC’s offices, as those defendants stopped working at MWC prior to the date of alleged service and MWC was not authorized to accept service for them” Mot. at 1, Footnote 1.

I.                BACKGROUND

In the interest of judicial economy, the Court incorporates the Background section of its September 28, 2022 Order Granting Defendants’ Motion to Dismiss.

See generally September 28, 2022 Order.

This suit arises out of a foreclosure and sale of 808 I Street, NE, Washington, D.C. (“Property”) in March and April 2019 (“Foreclosure Sale”), respectively.

Plaintiff, who owned the Property subject to a mortgage before the foreclosure, brought the instant suit seeking declaratory relief, asking the Court to set aside the Foreclosure Sale, seeking compensatory and pecuniary damages of $5 million, and punitive damages of $1 million.

See First Amended Cmplt. The instant suit was filed against the Federal Home Loan Mortgage Corporation (“Freddie Mac”); O’Sullivan; Michael T. Cantrell of MWC; Nationstar Mortgage LLC, d/b/a Mr. Cooper (“Nationstar”); the U.S. Department of Treasury, Internal Revenue Service (“IRS”); Tolga Tekin & Hantek Investments, LLC (“TTH”); and Alasgar Farhadov d/b/a Ali Farhadov (“Farhadov”). Id. at 1-2.

A.    Factual Background and Prior Procedural History

The procedural history of this case is undisputed.

This is not the first lawsuit between Plaintiff and the three relevant Defendants or their predecessors.

On September 21, 2015, Nationstar Mortgage, LLC, a predecessor to Nationstar, through their attorneys, MWC, filed a judicial foreclosure action in D.C. Superior Court for 808 I Street, NE, Washington, D.C. (“Property”).

See August 1, 2022 Mot. to Dismiss, Ex. A (Order Granting Summary Judgment in favor of Nationstar Mortgage, LLC, Taylor Bean & Whitaker Mortgage, LLC, and Ocwen Loan Servicing, LLC)

(collectively, the “Foreclosure Parties”).

On October 25, 2016, Plaintiff brought counterclaims against the Foreclosure Parties, all of which were dismissed on March 7, 2017.

August 1, 2022 Mot. to Dismiss, Ex. A at 2.

On September 13, 2017, Judge Todd E. Edelman entered Judgment of Judicial Foreclosure and instructed the Foreclosure Parties to conduct the sale.

Id. at 18-20.

On February 26, 2019, MWC issued a Notice of Impending Foreclosure Sale (“Notice”) to “All Occupants” of the Property and to Plaintiff specifically.

August 1, 2022 Mot. to Dismiss, Ex. D (Report of Sale, Ex. A).

MWC also notified the IRS. Id. On February 27, March 6, March 13, and March 20, 2019, MWC published the Notice in the Washington Times. August 1, 2022 Mot. to Dismiss, Ex. D (Report of Sale, Ex. B).

On February 28, 2019, MWC told Plaintiff that she could redeem the foreclosure if she paid the remainder of the mortgage, which was $270,647.21.

August 1, 2022 Mot. to Dismiss, Ex. E, ¶ 13; Opp. to 2022 Mot. to Dismiss at 2-3.

Plaintiff notified MWC on or about March 1, 2019, that she would redeem her mortgage. Id.

Later in March 2019,

MWC and ATG Title, Inc. (“ATG”), which Nationstar hired to conduct the sale,

both learned that the redemption price quoted by MWC on February 28, 2019, was approximately $74,000 too low because it accidentally omitted an IRS lien on the property which they then-believed existed.

August 1, 2022 Mot. to Dismiss, Ex. E, 13; Opp. to 2022 Mot. to Dismiss at 3-4.

Plaintiff did not pay the adjusted redemption price.

See id.; August 1, 2022 Mot. to Dismiss, Ex. E, ¶ 14.

On March 28, 2019, Nationstar sold the property for $642,000 to Hantek Investments, LLC, through Hantek’s Agent, Alasgar Farhdov.

August 1, 2022 Mot. to Dismiss, Ex. D (Report of Sale, Ex. E).

On March 29, 2019, O’Sullivan and Brown, acting as the Substitute Trustees, filed a Report of Sale. Id.

On April 1, 2019, Nationstar, through its attorney, Patrick Jules of MWC, filed a Motion to Ratify the Sale of Real Property (“Motion to Ratify”). Id.

On April 18, 2019, Plaintiff opposed the Motion to Ratify on the grounds that Nationstar engaged in “negligent misrepresentation or worst, fraud.”

August 1, 2022 Mot. to Dismiss, Ex. E.

Plaintiff asserted that the Foreclosure Parties deprived her of her statutory right to have an opportunity to redeem her mortgage and had engaged in fraud and misrepresentation.

Id. at 5-9, 11-13.

On April 19, 2019, Judge Hiram E. Puig-Lugo granted the Motion to Ratify.

August 1, 2022 Mot. to Dismiss, Ex. G.

On May 17, 2019, the Plaintiff filed a Motion for Reconsideration.

Id.

On June 11, 2019, Judge Puig-Lugo denied the Motion for Reconsideration. Id.

On August 22, 2019, Nationstar, through its attorney, Patrick Jules of MWC, filed a Motion to Ratify Accounting, Release the Bond, and Close the Case.

August 1, 2022 Mot. to Dismiss, Ex. H.

On September 5, 2019, Plaintiff filed an Objection.

August 1, 2022 Mot. to Dismiss, Ex. I.

The Court ratified the accounting.

See August 1, 2022 Mot. to Dismiss at 4.

On October 16, 2019, Judge Puig-Lugo granted a Motion filed by the IRS to disburse surplus sale proceeds.

August 1, 2022 Mot. to Dismiss, Ex. I.

The Court disbursed approximately $300,000 to Plaintiff.

Opp. to 2022 Mot. to Dismiss at 4.

B.    Procedural History

The relevant procedural history of the instant case is as follows.

On June 26, 2020, Plaintiff filed the instant Amended Complaint seeking to make a collateral attack on the foreclosure proceedings.

The Amended Complaint alleges six causes of action:

Breach of Fiduciary Duty;

Wrongful Foreclosure;

Wrongful Eviction;

Common Law Fraud & Intentional Misrepresentation;

Civil Conspiracy (Fraud & Civil Conspiracy);

and

Tortious Interference with Contract.

Compl. at 11-17.

Plaintiff filed a second Motion for Leave to File a Second Amended Complaint on June 3, 2022, and the Court granted the Motion on June 7, 2022.

On July 14, 2022, Plaintiff filed Affidavits of Service of Summons and Complaint on the following Defendants:

Abby Moynihan, Trustee;

Laura H.G. O’Sullivan, Trustee;

Chasity Brown, Trustee;

Erin Shaffer, Trustee;

and

McCabe, Weisberg & Conway LLC.

The facts alleged in the Amended Complaint are identical to those litigated in the prior action.

Plaintiff alleges the following causes of action:

(1) the Trustee Defendants breached a fiduciary duty (Second Amend. Cmplt. at 12, Count I);

(2) the Trustee Defendants and MWC fraudulently appointed Trustees and failed to provide a timely and accurate cure amount committing fraudulent and/or intentional misrepresentation

(Id. at 14, Count II2);

and

(3) MWC committed negligent misrepresentation.

Id. at 19, Count III.

Defendants Laura H.G. O’Sullivan, Trustee; Chasity Brown, Trustee; Erin Shaffer, Trustee; and McCabe, Weisberg & Conway LLC filed an Opposed Motion to Dismiss Second Amended Complaint on August 1, 2022.

Plaintiff filed an Opposition on September 2, 2022, and the named Defendants filed a Reply on September 8, 2022.

The Court granted the Motion to Dismiss for Failure to State a Claim on September 28, 2022 and dismissed the case without prejudice on October 21, 2022.

Plaintiff filed a Motion for Reconsideration on November 8, 2022.

Defendants Laura H.G. O’Sullivan, Trustee; Chasity Brown, Trustee; and McCabe, Weisberg & Conway LLC opposed the Motion on November 21, 2022, and Plaintiff filed a Reply on December 2, 2022.

The Court granted the Motion in part on December 7, 2022 because of a factual error in the Court’s September 28, 2022 Motion granting the Motion to Dismiss, and came to the same conclusion:

“Plaintiff’s Second Amended Complaint fails to state a claim upon which relief may be granted because it is barred by res judicata.”

December 7, 2022 Order at 1.

On January 4, 2023 Plaintiff filed a Notice of Appeal of this Court’s September 28, 2022 Order Granting Defendants’ Motion to Dismiss and December 7, 2022 Order Denying Plaintiff’s Motion for Reconsideration.

See Notice of Appeal.

The District of Columbia Court of Appeals held that the instant suit “involves the same claims that were or could have been at issue in the foreclosure action.”

DCCA September 26, 2024 Opinion at 13;

see also September 28, 2022 Order at 8;

see also December 17, 2022 Order at 11.

The DCCA reversed and remanded this Court’s dismissal of Plaintiff’s claims based on res judicata on the limited issue of privity and remanded

2 Plaintiff labels both this count and the next count as Count III. Because this is the second of three counts, the Court references this allegation as Count II.

for further proceedings consisting with its Opinion because “MWC and the Trustees did not carry their burden to show that they were in privity with Nationstar.”

DCCA Opinion at 20 (citing Johnson v. D.C. Rental Hous. Comm’n, 642 A.2d 135, 139 (D.C. 1994)

(“Res judicata is an affirmative defense that must be pleaded and established by the proponent.”).

The DCCA summarized Plaintiff’s arguments as follows:

while Plaintiff does not contest that the foreclosure litigation ended with a final judgment on the merits, “… she argues that her claims against MWC and the Trustees were not barred by res judicata as a result of that litigation because

(1) her second amended complaint raised distinct claims that were not, and could not have been, previously litigated;

(2) the fraud exception to res judicata should apply;

and

(3) MWC and the Trustees were not in privity with Nationstar.”

DCCA Opinion at 10.

The DCCA rejected the first two arguments and remanded “to allow litigation” of the third. Id.

Defendants McCabe, Weisberg Conway LLC (“MWC”), Laura H.G. O’Sullivan, Trustee (“Trustee O’Sullivan”), and Chasity Brown, Trustee (“Trustee Brown”) filed a Renewed Motion to Dismiss Second Amended Complaint on October 15, 2024.

Plaintiff filed an Opposition on November 6, 2024, and Defendants filed their Reply on November 19, 2024.

C.    Defendants’ Renewed Motion to Dismiss

Defendants make the following arguments in their Motion to Dismiss:

(1) Plaintiff’s claims are barred by the statute of limitations;

(2) Plaintiff’s claims are barred by res judicata, and Nationstar is in privity with the Trustees and with MWC;

(3) Plaintiff’s breach of fiduciary duty claim is meritless;

(4) Plaintiff’s fraud claim is meritless;

and

(5) Plaintiff’s negligent misrepresentation claim fails.

Memo in support of Mot. at 2, 4, 5, 8, 10, and 14.

Defendants ask that the Court dismiss the Second Amended Complaint with prejudice.

Id. at 15.

D.    Plaintiff’s Opposition to Defendants’ Renewed Motion to Dismiss

In Plaintiff’s Opposition to the instant Motion, she makes many of the same arguments she made in her Opposition to Defendants’ Motion to Dismiss filed in 2022. She argues the following:

(1) “Defendants concede that Plaintiff’s ratification claims related to the March 2019 claims are timely filed;”

(2) “Plaintiff’s 2019 claims are not barred by res judicata;”

(3) “Plaintiff has stated an actionable claim for breach of fiduciary duty against the substitute trustees;”

(4) “Plaintiff’s claim for fraudulent and/or intentional misrepresentation against all defendants is not subject to dismissal;”

and

(5) “Plaintiff has alleged an actionable negligent misrepresentation claim against MWC.”

3 Opp at 6, 14, 19.

Further,

“Defendants’ summary of Plaintiff’s current claims oversimplifies Plaintiff’s causes of action against the individual trustees and the institutional Defendant by way of respondeat superior and that the Trustees who as lawyers simultaneously represented the creditor Nationstar during the foreclosure and failed to exercise its fiduciary duty to the borrower” and “the preclusive doctrines of res judicata and collateral estoppel are inapplicable in this case.”

Opp. at 1.

E.    Defendants’ Reply

In their reply, Defendants essentially reiterate the arguments they make in their Motion adding that “Plaintiff has failed to comply with the court’s supplement to general order.”

Reply at 2, 6, 8, 9, and 10.

II.          LEGAL STANDARD

A complaint should be dismissed under Rule 12(b)(6) if it does not satisfy the requirement of Rule 8(a) that a pleading contain a “short and plain statement of the claim showing that the

3 Plaintiff goes to great lengths to undercut Defendants’ arguments by criticizing their reliance on various cases, calling those cases inapplicable or inappropriate. See e.g. Opp. at 9-10. Notably, six of those cases are not mentioned or relied upon a single time by Defendants. See generally Opp.; see Reply at 5-6. It is unclear to the Court whether Plaintiff is intermittently referencing a different Motion, perhaps from an entirely different case.

pleader is entitled to relief.”

Potomac Dev. Corp. v. District of Columbia, 28 A.3d 531, 543 (D.C. 2011) (quoting Super. Ct. Civ. R. 8(a)).

“To survive a motion to dismiss, a complaint must set forth sufficient information to outline the legal elements of a viable claim for relief or to permit inferences to be drawn from the complaint that indicate that these elements exist.”

Williams v. District of Columbia, 9 A.3d 484, 488 (D.C. 2010) (citation and quotations omitted);

see Doe v. Bernabei & Wachtel, PLLC, 116 A.3d 1262, 1266 (D.C. 2015)

(“To survive a motion to dismiss, a complaint must set forth sufficient facts to establish the elements of a legally cognizable claim.”) (citations and quotations omitted)).

In resolving a motion to dismiss, “the court accepts as true all allegations in the Complaint and views them in a light most favorable to the nonmoving party.”

Jordan Keys & Jessamy, LLP v. St. Paul Fire & Marine Ins. Co., 870 A.2d 58, 62 (D.C. 2005) (citations and quotations omitted).

“A pleading that offers ‘labels and conclusions’ or ‘a formulaic recitation of the elements of a cause of action will not do.’”

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007));

see Sundberg v. TTR Realty, LLC, 109 A.3d 1123, 1128–29 (D.C. 2015)

(“[W]here a complaint pleads facts that are merely consistent with a defendant’s liability, it stops short of the line between possibility and plausibility of entitlement to relief.” (Citations and quotations omitted)).

“To satisfy Rule 8(a), plaintiffs must nudge their claims across the line from conceivable to plausible.”

Tingling-Clemmons v. District of Columbia, 133 A.3d 241, 246 (D.C. 2016) (citation and quotations omitted).

However, “[w]hen there are well- pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.”

Carlyle Inv. Mgmt., L.L.C. v. Ace Am. Ins. Co., 131 A.3d 886, 894 (D.C. 2016) (alteration in original) (citation and quotations omitted).

“A complaint should not be dismissed because a court does not believe that a plaintiff will prevail on its claim; indeed it may appear on the face of the pleadings that a recovery is very remote and unlikely but that is not the test.”

Carlyle Inv. Mgmt., L.L.C., A.3d at 894 (citation, quotations, and brackets omitted).

In addition, the Court should “draw all inferences from the factual allegations of the complaint in the [non-movant’s] favor.” Id. (citation omitted).

However, legal conclusions “are not entitled to the assumption of truth,”

Potomac Dev. Corp., 28 A.3d at 544 (quoting Iqbal, 556 U.S. at 664),

so “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”

Sundberg, 109 A.3d at 1128–29 (quoting Iqbal, 556 U.S. at 678).

The complaint must plead “factual content that allows the court to draw the reasonable inference that defendant is liable for the misconduct alleged.”

Poola v. Howard Univ., 147 A.3d 267, 276 (D.C. 2016) (citation and quotations omitted).

III.           DISCUSSION

A.    Plaintiff’s claims are barred by res judicata, as both MWC and the Trustees were in privity with Nationstar.

As previously stated, Plaintiff argues that MWC and the Trustees were not in privity with Nationstar, and therefore her claims against MWC and the Trustees are not barred by res judicata.

See DCCA Opinion at 10.

The Court disagrees.

In the instant Motion, Defendants reference this Court’s previous dismissal in Defendants’ favor on the grounds of res judicata, and the Court of Appeals’ subsequent affirmance of “the bulk of that ruling,” and focus only on the issue of privity, or the “mutuality of legal interests.”

Memo in support of Mot. at 4.

Defendants argue that “for purposes of exercising the power of sale, the legal interests of Nationstar and the Trustees are functionally inseparable and are thus in privity for res judicata purposes.”

Id. at 5.

Defendants similarly argue that Nationstar enjoyed privity with MWC.

See Id. at 7.

“With respect to claims arising out of or relating to the foreclosure proceedings and MWC’s representation of Nationstar therein, MWC and Nationstar are in privity” because they shared the same interest – foreclosing on the Property.

Id. at 8.

MWC filed the foreclosure case for Nationstar, and MWC’s attorneys participated as counsel in the prior action.

Id.

In arguing that her claims are not barred by res judicata, Plaintiff states that MWC and the Trustees were not in privity with any of the parties to the prior litigation. Id.

“Defendants acted as substitute trustees and/or counsel for Nationstar in the foreclosure action; therefore, Defendants in their legal capacities were Nationstar’s agents” and for the purposes of res judicata, agents are not usually in privity with principals.

Id. at 7 (citing Makins v. District of Columbia, 861 A.2d 590, 593 (D.C. 2004);

Major v. Inner City Prop. Mgmt., 653 A.2d 379, 381 (D.C. 1995)).

Plaintiff argues there are several issues of material fact, and this dismissal of her Second Amended Complaint is inappropriate:

“… [T]he facts alleged in the Second Amended Complaint [] raise an issue of material fact as to whether Defendants’ intentionally tortious conduct, as trustees with a duty owed to Plaintiff, was within the scope of its attorney-client agency relationship with Nationstar.

The question must be examined differently for Defendant MWC’s Trustees simultaneously serving as lawyers for the creditor, while receiving compensation in both instances presents a material fact question which cannot be adjudicated at this stage of the litigation.”

Opp. at 7-8.

Plaintiff states that Nationstar and MWC do not share an interest:

“… [I]t is oxymoronic as a matter of law that a mutuality of legal interests can be established when Defendants as trustees and lawyers simultaneously owe additional duties to the Debtor and the exercise thereof present, as here, inherent conflicts of interest.

The Creditor’s lawyers, while serving as Trustees, were retained to collect the Creditor’s debt.

They foreclosed on Plaintiff’s property with a corresponding simultaneous statutory obligation to timely ensure Plaintiff’s correct payoff.

[T]wo competing interests, which are neither aligned nor mutual.”

Id. at 8.

In Defendants’ Reply, they argue that Plaintiff failed to rebut their argument that privity arose from “MWC’s relationship with the creditor that it represented.”

Reply at 3.

They further argue that “[t]he privity question for the [T]rustees is couched in terms of their duties under the deed of trust.

As noted by the Court of Appeals, the relationship between …the Trustees, on the one hand, and Nationstar on the other hand, is governed by the deed of trust and foreclosure order.”

Id.

Once the Lender – in this case, Nationstar – invokes the power of sale, the Trustees’ powers under the deed come into play.

Id.

“The Lender declared a default, invoked the power of sale, and filed the Foreclosure Complaint.

The Trustees carried out the sale process at the direction of the court and the deed of trust.”

Id. at 4.

Defendants further argue that Plaintiff sued Nationstar for “the very same set of circumstances for which the Trustees are sued” and that “for purposes of exercising the power of sale, the legal interests of Nationstar and the Trustees are functionally inseparable and are thus in privity for res judicata purposes.”

Id. at 4-5.

To establish privity, parties’ interests must be so “so identified in interest . . . that [they] represent[] precisely the same legal right in respect to the subject matter of the case.”

DCCA Opinion at 21

(quoting Bell v. Weinstock, Friedman & Friedman, P.A., 285 A.3d 505, 509 (D.C. 2022))

(quoting Patton v. Klein, 746 A.2d 866, 870 (D.C. 1999)).

Agents and principals are not usually in privity with each other – res judicata applies in a later action against the agent only if the prior suit concerned matter within the agency.

Id. (quoting Bell v Weinstock at 509)

(quoting Major v. Inner City Prop. Mgmt., Inc., 653 A.2d 379, 381 (D.C. 1995)).

The DCCA stated in its Opinion that “to establish privity between an attorney and their client, the party asserting res judicata must show ‘a mutuality of legal interests’ between the two parties,” and that “MWC put forward no evidence or argument before the Superior Court about the ‘mutuality of [its] legal interests’ with Nationstar.”

DCCA Opinion at 21 (citing Major).

This Court finds that Defendants satisfied their burden to show a mutuality of interests between Nationstar and MWC in their Renewed Motion to Dismiss, and that therefore Nationstar is in privity with MWC.

“Nationstar and MWC had the same interest, foreclosing on the Property.”

Memo in Support of Mot. at 8.

“The Foreclosure Case was filed for Nationstar by MWC.

The attorneys of MWC participated in the prior action as counsel.

There is no allegation that MWC had any interest in or relationship to the property or the foreclosure beyond that as Nationstar’s counsel.”

Id.

Thus, privity between Nationstar and MWC has been established.

Defendants state that “the issue of privity between foreclosure counsel and the trustee and/or lender does not appear to have been directly addressed by courts in the District… courts that have addressed the issue have uniformly found that foreclosure counsel is in privity with the trustee and lender with respect to claims arising from a foreclosure proceeding.”

Memo in Support of Mot. at 7-8;

see e.g. Zinni v. Jackson White PC, 565 Fed.Appx. 613, 617 (9th Cir. 2014)

(“a finding of privity is appropriate ‘where the nonparty had a significant interest and participated in the prior action’ or ‘where the interests of the nonparty and party are so closely aligned as to be virtually representative’”);

Kawelo v. Nationstar Mortgage LLC, 2018 WL 4354295, *5 (D. Hawaii Sept. 12, 2018)

(“noting that defendant would have been in privity with Nationstar if the defendant had been counsel for Nationstar in the foreclosure”);

Hines v. First Citizens Bank, 2024 WL 3833809, *12 (N.D. Ga. July 26, 2024).

The DCCA held that “the Trustees put forward no evidence or argument about the scope of their agency relationship with Nationstar” and failed to satisfy their burden to show a mutuality of interests between Nationstar and the Trustees.

DCCA Opinion at 21.

Defendants satisfied their burden to demonstrate a mutuality of interests in their Renewed Motion to Dismiss, and the Court now finds that Nationstar is in privity with the Trustees.

“The Lender declared a default, invoked the power of sale, and filed the Foreclosure Complaint. The Trustees carried out the sale process at the direction of the court and the deed of trust…

Plaintiff sued Nationstar for a variety of alleged misdeeds related to the sale of the property – the very same set of circumstances for which the Trustees are sued.”

Memo in Support of Mot. at 5.

“The Trustees’ power to conduct a foreclosure came from

(1) their appointment by Nationstar

and

(2) the Foreclosure Order that was entered at the request of Nationstar in the foreclosure case filed by Nationstar.”

Id. at 6.

The Court agrees with Defendants that the foreclosure sale of the property was a “singular, mutual” and “identical” interest between the Lender and the Trustees and that there is a “clearly aligned set of legal interests between a substitute trustee and the lender that has appointed same.”

Id. at 5-6;

see also Proctor v. Wells Fargo Bank, N.A., 289 F.Supp.3d 676, 683 (D. Md. 2018)

(“When a substitute trustee prosecutes a state court foreclosure action on behalf of a mortgage servicer, which in turn serviced the underlying mortgage on behalf of the lender, the servicer, lender and substitute trustee share the same right to foreclose on the subject mortgage, such that the privity component of claim preclusion is satisfied.”)

(internal quotations and citations omitted);

see also Palacios v. Specialized Loan Servicing LLC, 2017 WL 4484261, *3 (E.D. Va. Sept. 12, 2017)

(“…in mortgage cases, the network of privity extends to include all of the relevant parties in the chain of foreclosure…”).

Nationstar is in privity with the Trustees and with MWC, as there is a mutuality of legal interests.

Thus, Plaintiff’s claims against Trustees and with MWC are barred by res judicata, and the Court’s 2022 dismissal of this suit is affirmed.

Because the Court affirms its 2022 dismissal of this suit, the instant Motion to Dismiss is moot.

It is typically inappropriate for the Court to “record [its] views concerning a controversy which no longer exists and to rule on a question which has become moot.”

Banks v. Ferrell, 411 A.2d 54, 56 (D.C. 1979).

However, the DCCA “encourage[d] [this Court] to address all issues raised by the parties and to make alternative rulings as necessary, with the aim of finally resolving all of Ms. Richardson’s claims.”

DCCA Opinion at 23.

The Court offers its analysis on Defendants’ arguments in their Motion to Dismiss below.

B.    Plaintiff’s claims are barred by time limitations.

Defendants argue that pursuant to D.C. Code § 12–301, the limitations period for Plaintiff’s claims is three years, and that because “[t]he last event asserted by Plaintiff as giving rise to a claim is the March 26, 2019 payoff statement… any claim arising from any of the Plaintiff’s allegations had to be asserted against the Defendants no later than March 26, 2022.”

Memo in support of Mot. at 2.

They argue that an amendment to a Complaint that names a new party “relates back only if the defendant was notified of the pendency of the proceeding prior to the running of limitations,” and that “Plaintiff’s complaint contains no allegation suggesting notice to the Defendants of the pendency of this case prior to the running of limitations.”

Id. at 3 (citing Arrington v. District of Columbia, 673 A.2d 674 (D.C. 1996)).

In Plaintiff’s argument section titled “Defendants concede Plaintiff’s ratification claims related to the March 2019 claims are timely filed;” she writes a single sentence:

“Defendants concede that Plaintiff’s 2019 claims related to tie ratification related inaccurate and untimely ratification payoff statements were timely filed.”

Opp. at 6.

This is not the case.

“Aside from the fact that Plaintiff’s statement is unintelligible, the notion that Defendants have ‘conceded’ that Plaintiff’s claims are not time-barred is directly contradicted by the fact that Defendants spent an entire section explaining why the Plaintiff’s claims are, in fact, time-barred.”

Reply at 2.

Because the last event asserted by Plaintiff as giving rise to a claim is the March 26, 2019 payoff statement, the limitations period for Plaintiff’s claims is three years pursuant to D.C. Code § 12–301.

Additionally, because there is no evidence that Defendants received notice of the pendency of this case prior to the running of limitations, the Second Amended Complaint and its naming of the Trustees as new parties does not relate back.

See Arrington v. District of Columbia, 673 A.2d 674 (D.C. 1996)).

Even if Plaintiff’s claims were not barred by res judicata, they would be barred by the statute of limitations, making dismissal appropriate.

C.    Plaintiff’s breach of fiduciary duty claim fails.

Plaintiff argues that Defendants breached their fiduciary duties through the following:

(1) a “failure to properly investigate the asserted IRS lien and to ensure an accurate representation thereof to Plaintiff…;”

(2) a failure “to properly and timely notify Plaintiff of an accurate payoff amount;”

and

(3) a failure “to ensure accurate and truthful representations to the Recorder of Deeds pertinent to the Appointment of Substitute Trustees… in MWC’s 2015 foreclosure action.”

Second Amend. Cmplt. at ¶ 62.

Plaintiff does not provide a statutory basis establishing these duties.

Defendants argue that Plaintiff’s breach of fiduciary claim is meritless, stating that Plaintiff “‘cites no provision in the deed of trust or District of Columbia law to support the existence of the trustee’s fiduciary duty…’ to do (or not do) any of the things that Plaintiff asserts as breaches of fiduciary duties.”

Memo in Support of Mot. at 10 (quoting Henok v. Chase Home Finance, LLC, 915 F.Supp.2d 162, 169 (D. D.C. 2013).

In her Opposition, Plaintiff states that “an actionable claim against the substitute trustees and against the Defendant law firm [exists] by way of respondeat superior for breach of fiduciary duty.”

Opp at 14.

“Because the substitute trustees herein are also members and/or employees of MWC, which acted as counsel for the holder Nationstar against the Plaintiff-borrower in the prior litigation, the substitute trustees obviously had conflicting interests with the Plaintiff in the underlying actions regarding the March 2019 payoff…”

Id. at 16.

“[D]espite its duty to ensure a balanced protection of competing interests, the Trustees acting in a separate and distinct alignment from its statutory duties, sided with their law firm’s client throughout the entire ratification process ultimately to Richardson’s detriment.” Id.

While Plaintiff lists numerous provisions of the D.C. Code that Defendants allegedly violated, she does not describe how these statutes or duties were violated or how they relate to the duties of the Trustees.

See Reply at 7.

Additionally, she does not specify which affirmative fiduciary duty Defendants allegedly breached.

“The duties owed by a trustee are strictly limited to those set forth in the deed of trust.”

Reply at 7 (citing Perry v. Virginia Mortg. and Inv. Co., Inc.,412 A.2d 1194 (D.C. 1980).

In Perry v. Virginia Mortgage and Investment Company, a case repeatedly cited by Plaintiff in her Opposition, the Court “explicitly disclaims any general fiduciary duty beyond those imposed by the deed of trust, noting that the court saw “no basis for imposing on the trustees by judicial fiat any ‘general fiduciary duties.’” Id. (citing Perry at 1198).

Plaintiff fails to articulate which, if any, explicit fiduciary duty imposed by the deed of trust was breached.

As such, her fiduciary duty claim must fail.

Even if Plaintiff’s claims were not time-barred, and even if they were not barred by res judicata, her claim for breach of fiduciary would fail.

D.    Plaintiff’s fraudulent and/or intentional misrepresentation claim fails.4

Plaintiff alleges that “Defendants… caused patently false representations to be made to the Recorder of Deeds and to this court regarding the Appointment of the Substitution of Trustees and the required Deed of Appointment.”

Second Amend. Cmplt. at ¶ 17.

Plaintiff also alleges that Defendants failed to provide a timely and accurate cure amount.

Second Amend. Cmplt. at 14 and 17.

4 While Plaintiff labels this a “fraudulent and/or intentional misrepresentation claim,” she only offers analysis in her Opposition on the prior claim – fraudulent misrepresentation.

“The essential elements of common law fraud are:

(1) a false representation

(2) in reference to material fact,

(3) made with knowledge of its falsity,

(4) with the intent to deceive,

and

(5) action is taken in reliance upon the representation.”

Bennett v. Kiggins, 377 A.2d 57, 59 (D.C. 1977), cert. denied, 434 U.S. 1034, 98 S. Ct. 768, 54 L. Ed. 2d 782 (1978);

see also Opp. at 17-18.

Plaintiff argues that she properly pled each element of her fraudulent misrepresentation claim.

Opp. at 18.

The Court disagrees.

Plaintiff failed to state a claim for fraud relating to the deed of appointment as she has not pled that she relied on or took action in reliance on the deed of appointment.

See Memo in Support of Mot. at 11.

Further, Plaintiff failed to state a claim for fraud regarding the payoff statement, as “Plaintiff cannot show damages or reliance, as the payoff was provided to ATG Title, not to her, and was provided after her deadline to cure had passed, as this Court has already found on numerous occasions.” Id.

The tort of common law fraud requires not only an intention to induce reliance, but also reliance itself, as well as action taken in reliance.

See Saucier v. Countrywide Home Loans, 64 A.3d 428, 438 (D.C. 2013)

(requiring action to be taken in reliance upon the representation to establish common law fraud);

see also Howard v. Riggs National Bank, 432 A.2d 701, 708 (D.C. 1981);

see also Bennett v. Kiggins at 59.

Plaintiff has not satisfied these elements, as she has not offered evidence of reliance.

Regarding Trustee O’Sullivan and Trustee Brown, Defendants state, “Plaintiff fails to plead any representation, let alone a material misrepresentation.”

Memo in Support of Mot. at 14.

“Plaintiff cannot simply refer to all Defendants []as having collectively made a false representation. Plaintiff did not make any attempt to allege that Trustee O’Sullivan or Trustee Brown did anything, and Plaintiff’s complaint fails as to the Trustees for that reason.” Id.

The Court agrees with the Defendant’s representations.

Even if Plaintiff’s claims were not time-barred, and even if they were not barred by res judicata, her claim for fraudulent and/or intentional misrepresentation would fail.

E.    Plaintiff’s negligent misrepresentation claim fails.

Plaintiff alleges that MWC made the following misrepresentations:

(1) “[m]aking false statements in the Complaint and to the Recorder of Deeds regarding the deed of appointment;”

and

(2) “[c]onveying inaccurate payoff amounts.”

Memo in Support of Mot. at 14-15 (citing Second Amend. Compl. at ⁋87).

As Plaintiff discusses in her Opposition,

“[t]o establish negligent misrepresentation by a defendant, a plaintiff must show that:

(1) “[t]he defendant negligently communicated false information;”

(2) “[t]he defendant intended or should have recognized that the plaintiff would likely be imperiled by action taken in reliance upon his misrepresentation;”

and

(3) “[t]he plaintiff reasonably relied upon the false information to his detriment.”

Hall v. Ford Enters., Ltd., 445 A.2d 610, 612 (D.C. 1982);

see also Opp. at 19.

The Court finds that Plaintiff has failed to establish these elements, particularly relating to reliance.

Regarding the claim about false statements regarding the deed of appointment, Defendants argue:

“the alleged misrepresentation was made to and (allegedly) relied upon by the Court and the Recorder of Deeds, not the Plaintiff.”

Memo in support of Mot. at 15.

The Court agrees and finds that the deed of appointment did not affect Plaintiff’s actions or decisions.

See id.

Notably, “…the court in the Foreclosure Case already determined that the Trustees were validly appointed, granted summary judgment on that issue, and ratified the sale over the Plaintiff’s objections.”

Id.

Regarding the payoff claim, Defendants argue: “[t]here is no allegation showing that Defendants had a duty to prepare or convey a payoff statement to Plaintiff.

More importantly, there are no allegations showing reliance on that March 26, 2019 payoff statement by Plaintiff.

Rather, the allegation is that Plaintiff and her buyer knew the payoff was erroneous and refused to pay.”

Id. (citing Second Amend. Compl. at ⁋44-45).

While Plaintiff argues in her Second Amended Complaint that the Trustees “enjoyed a duty” to ensure the $73,635.14 federal tax lien was not included “in any payoff figure,” she does not provide any evidence of this duty.

See Second Amend Compl. at ⁋45.

She further argues that “as a result of Defendants presenting a payoff that included the released IRS debt, she was unable to stop the scheduled March 28, 2019 foreclosure sale.”

Id. at at ⁋48.

The allegation that the addition of the tax lien in the March 26, 2019 payoff statement made Plaintiff “unable to stop” the sale falls short of demonstrating true reliance, particularly because the deadline to cure had passed.

See Memo in Support of Mot. at 11.

Even if Plaintiff’s claims were not time-barred, and even if they were not barred by res judicata, her claim for negligent misrepresentation would fail because she fails to demonstrate the required element of reliance.

For the reasons stated above, the Court affirms its dismissal of Plaintiff’s claims and denies as moot Defendants’ Renewed Motion to Dismiss.

After nearly a decade of litigation regarding the sale of Plaintiff’s home at foreclosure (see DCCA Opinion at 23), this case is closed.

Accordingly, it is on this 20th day of December, 2024, hereby,

ORDERED that the Court’s September 28, 2022 dismissal of Plaintiff’s claims is AFFIRMED;

and it is further

ORDERED that and Defendants’ Renewed Motion to Dismiss is DENIED AS MOOT;

and it is further

ORDERED that pursuant to this Court’s Orders on September 28, 2022, October 21, 2022, and December 7, 2022,

this case is CLOSED.

EASTERLY, Associate Judge

Karen Richardson appeals from a Superior Court order dismissing on res judicata grounds her claims of fraudulent and/or intentional misrepresentation against McCabe, Weisberg & Conway, LLC (“MWC”) and Trustees Laura H.G. O’Sullivan and Chasity Brown (the “Trustees”),

negligent misrepresentation against MWC,

and

breach of fiduciary duty against the Trustees for actions related to the judicial foreclosure of her home.

For the following reasons, we are constrained to reverse the Superior Court’s judgment on the limited issue of privity.

We remand for further proceedings consistent with this opinion.

I.               Background

In 2008, Ms. Richardson obtained a loan from Taylor, Bean & Whitaker Mortgage Corporation (“TBW”) that she secured through a promissory note and a deed of trust to the home she owned at 808 I St., NE.

The Federal Home Loan Mortgage Corporation (“Freddie Mac”) later became the owner of the promissory note and, after a series of transfers, successors to TBW assigned Nationstar Mortgage, LLC (“Nationstar”) to be the holder and servicer of the note.

Nationstar then executed a deed of appointment to appoint several members of MWC, including Laura H.G. O’Sullivan and Chasity Brown, as Substitute Trustees of the deed of trust.

Although the language in the deed of trust stated that the “Lender” had the power to appoint successor trustees, the deed of appointment stated that, under the deed of trust, the “holder” of the note could appoint substitute trustees who would have “all the rights, powers and authority” as the trustees who were originally named.

A.             The Foreclosure Litigation

In September 2015, Nationstar filed a complaint for judicial foreclosure against Ms. Richardson, alleging that she had defaulted on her mortgage.

Ms. Richardson responded by filing counterclaims against Nationstar, TBW, and another mortgage servicer, claiming that they had violated various federal and local fair lending and consumer protection laws.

Ms. Richardson also contested whether Nationstar had been properly assigned as a holder of the note and whether it could, therefore, foreclose on her home.

The Superior Court (Hon. Todd Edelman) concluded that Nationstar was a holder of the note and entitled to enforce it, granted summary judgment in favor of Nationstar, and ordered the judicial foreclosure of the property to be carried out by the Trustees.

Ms. Richardson appealed the Superior Court’s decision, and we ultimately dismissed the appeal as moot (because, in the absence of a stay, the property had already been sold, see infra).

On February 26, 2019, after a year and a half of delay during which Ms. Richardson filed for bankruptcy, MWC, acting as counsel for Nationstar, sent Ms. Richardson a Notice of Impending Foreclosure Sale.

The sale was scheduled for March 28, 2019.1

In an attempt to prevent the sale, Ms. Richardson arranged for

1 The notice erroneously listed the date of the sale as March 28, 2018, but the accompanying advertisement clarified the correct year as 2019.

her cousin, Carolyn Jackson, to purchase her home and redeem the mortgage.

Ms. Jackson hired ATG Title, Inc., a real estate settlement agency, to help conduct the purchase.

ATG then contacted MWC to request the specific amount needed to redeem Ms. Richardson’s mortgage.

Sometime before March 1, 2019, MWC sent Ms. Richardson a letter listing the payoff amount—good through March 5, 2019— as $270,647.21.

Closing for this sale of the property to Ms. Jackson was scheduled to take place on March 26, 2019, and ATG requested an updated payoff amount from MWC that would be accurate as to that date.

MWC, however, did not respond to ATG’s request until after 5:00 pm on March 26.

The updated payoff figure MWC sent erroneously included a tax lien Ms. Richardson had previously paid, making the payoff figure roughly $74,000 higher than MWC’s earlier estimation.

Ms. Jackson did not go through with the purchase.

On March 28, 2019, the Trustees conducted the foreclosure sale and sold the property to Hantek Investments, LLC.

Following the foreclosure sale, Nationstar, represented by MWC, returned to the Superior Court to ratify the sale of the property.

Ms. Richardson opposed the ratification motion and claimed that she was entitled to relief from wrongful foreclosure.

Specifically, she argued

(1) Nationstar2 and MWC violated her right

2    Ms. Richardson referred to Nationstar by its alleged tradename “Mr. Cooper” throughout these filings.

under the deed of trust and D.C. Code § 42-815.01(b) to receive an accurate report of the amount needed to cure the default on her mortgage prior to the foreclosure sale;

(2) Nationstar engaged in fraudulent misrepresentation when MWC sent the incorrect payoff amount;

and

(3) the Trustees demonstrated “inequitable conduct with no regard [for the] fiduciary duty” they owed to Ms. Richardson.

The Superior Court (Hon. Hiram Puig-Lugo) granted Nationstar’s motion to ratify and rejected Ms. Richardson’s claims, explaining that Ms. Jackson had obtained sufficient financing to purchase the property and cover the initial payoff amount;

pursuant to D.C. Code § 42-815.01(b), Ms. Richardson’s right to cure the default on her mortgage expired on March 22, 2019, five days before the scheduled foreclosure sale on March 28, 2019;

and

“all that Ms. Jackson had to do” to redeem Ms. Richardson’s mortgage “was tender [the] payment no later than March 22nd,” which did not occur.

The court concluded that the incorrect payoff amount Nationstar provided Ms. Richardson on March 26, 2019, accordingly, did not prejudice her because her right to cure the default had already lapsed.

Ms. Richardson moved for reconsideration, which the Superior Court denied.

Ms. Richardson then appealed the Superior Court’s order denying reconsideration, which this court dismissed as moot (again because the property had already been sold).

After Nationstar moved to ratify the accounting and close the case in the Superior Court, Ms. Richardson continued to object to the foreclosure sale, arguing, among other things, that MWC and the Trustees had given her an inaccurate loan payoff amount and had failed to explain the error.

The Superior Court once again rejected Ms. Richardson’s arguments, ratified the accounting, and ordered the foreclosure sale as final.3

Ms. Richardson did not appeal.

B.             Ms. Richardson’s Affirmative Suit

After the Superior Court closed the foreclosure case, Ms. Richardson filed suit against Nationstar; Freddie Mac; the Internal Revenue Service; Hantek Investments, LLC, the real estate broker who conducted the foreclosure sale; the Trustees; and MWC.

Ms. Richardson claimed, inter alia, that Nationstar and MWC (as Nationstar’s counsel) had wrongfully foreclosed on her property, that Hantek and the real estate broker wrongfully evicted her, and that Nationstar, MWC, and the Trustees engaged in common law fraud and intentional misrepresentation.

The Superior Court (Hon. Florence Y. Pan) dismissed Ms. Richardson’s claims against

3 Hantek Investments, LLC, the purchaser of the property, filed an eviction action in September 2019 in the landlord and tenant division of the Superior Court (2019 LTB 19572).

Ms. Richardson filed a motion to dismiss, but the Superior Court (Hon. Melvin R. Wright) denied her motion and entered a nonredeemable judgment of possession for Hantek.

Although Ms. Richardson unsuccessfully sought to stay her eviction and unsuccessfully appealed the Superior Court (Hon. Lee F. Satterfield)’s decision not to stay her eviction, she did not appeal the eviction judgment.

Nationstar as barred by res judicata and collateral estoppel following the foreclosure action, dismissed her claims against Hantek as barred by res judicata based on an earlier successful suit by Hantek for possession of the property, see supra note 3, and dismissed her claims against Freddie Mac for failure to state a claim.

The court granted Nationstar, Hantek, and Freddie Mac a final judgment under Super. Ct. Civ. R. 54(b),4 but held Ms. Richardson’s claims against MWC and the Trustees (whom she had yet to serve) in abeyance.

Ms. Richardson appealed the Superior Court’s order5 and this court summarily affirmed.

Back in Superior Court, Ms. Richardson obtained permission to file a second

4 The Superior Court purported to grant a final judgment under Super. Ct. Civ. R. 54(b) to Nationstar, Hantek, and Freddie Mac during a hearing on Hantek’s motion for entry of final judgment and for release of notice of lis pendens, but later issued a written order that specifically granted a final judgment only as to Hantek.

5 In her brief to this court, Ms. Richardson did not mention that the court had granted a partial judgment under Rule 54(b) and inaccurately stated that “[t]his appeal is from a final order or judgment that disposes of all parties’ claims.”

It is far from clear that the Superior Court’s Rule 54(b) ruling either extended to Nationstar and Freddie Mac, see supra note 4, or was adequately substantiated as to any party.

See Peoples v. Warfield & Sanford, Inc., 660 A.2d 397, 403 (D.C. 1995)

(explaining that the trial court’s “Rule 54(b) certification must be accompanied by a statement of reasons explaining why the judgment should be deemed final for purposes of appeal”).

Thus, it is unclear whether Ms. Richardson should have been able to separately appeal the partial judgment given to Nationstar, Hantek, and Freddie Mac.

amended complaint again naming MWC and the Trustees as defendants6 and alleging that

(1) the Trustees breached their fiduciary duty to Ms. Richardson by including the released tax lien in the second payoff letter and wrongly representing that they had been appointed as substitute trustees,

(2) the Trustees and MWC engaged in fraudulent and/or intentional misrepresentation by providing her with an incorrect payoff amount and making misrepresentations about whether the Trustees were properly appointed,

and

(3) MWC engaged in negligent misrepresentation by providing the incorrect payoff amount.

MWC and the Trustees moved to dismiss, averring that Ms. Richardson’s claims were barred by res judicata and collateral estoppel based on the foreclosure litigation, and should be dismissed pursuant to Super. Ct. Civ. R. 12(b)(6).

After Ms. Richardson argued that res judicata did not apply because

MWC and the Trustees were not parties to the foreclosure action and were not in privity with Nationstar,

MWC and the Trustees claimed that they had privity with Nationstar as Nationstar’s agents and

“[t]here [was] no viable inference that [their] involvement [in the foreclosure] was anything other than in the context of acting as agent[s] for [Nationstar] . . . as trustees and [Nationstar’s] counsel.”

6 Ms. Richardson’s complaint also indicated that Michael Cantrell, “the managing attorney” at MWC, had injured her but did not name him as a defendant, and she named Trustees Abby Moynihan, Erin Shaffer, and Yolanda Clarke as defendants but did not properly serve them.

The Superior Court (Hon. Yvonne Williams) initially mistakenly reviewed Ms. Richardson’s first amended complaint (rather than her second amended complaint) and dismissed her claims as barred by res judicata.

After Ms. Richardson moved for reconsideration, the Superior Court revisited its analysis but determined that res judicata continued to bar Ms. Richardson’s claims because they mirrored arguments she had made or could have made in the foreclosure proceedings.

The court indicated (incorrectly) that it believed Ms. Richardson had not disputed MWC and the Trustees’ assertion of privity with Nationstar prior to her motion for reconsideration, and it ruled that the fraud exception to res judicata did not apply.

Ms. Richardson timely appealed.

II.            Analysis

Under the doctrine of res judicata, or claim preclusion, a final judgment on the merits bars relitigation in a subsequent proceeding of all claims that were actually litigated or “could have been litigated in the prior proceeding” between the same parties or their privies.

Faulkner v. Gov’t Emps. Ins. Co., 618 A.2d 181, 183 (D.C. 1992).

In reviewing an order granting a motion to dismiss on res judicata grounds pursuant to Super. Ct. Civ. R. 12(b)(6),

“[w]e accept all factual allegations in the complaint as true, and construe all facts and inferences in favor of the plaintiff.”

Peterson v. Washington Tchrs. Union, 192 A.3d 572, 575 (D.C. 2018) (internal quotation marks omitted).

“Whether the trial court correctly applied res judicata principles to the facts of this case is a legal issue that we decide de novo.”

Shin v. Portals Confederation Corp., 728 A.2d 615, 618 (D.C. 1999).

Ms. Richardson does not contest that the foreclosure litigation ended with a final judgment on the merits but she argues that her claims against MWC and the Trustees were not barred by res judicata as a result of that litigation because

(1) her second amended complaint raised distinct claims that were not, and could not have been, previously litigated;

(2) the fraud exception to res judicata should apply;

and

(3) MWC and the Trustees were not in privity with Nationstar.

We reject the first and second arguments and remand to allow litigation of the third.

A.             Identity of Claims

Ms. Richardson first challenges the Superior Court’s determination that identity of claims existed between her present suit and the foreclosure litigation, which encompasses the trial court’s initial foreclosure order and the subsequent litigation of the post-sale ratification and accounting.

We discern no error.

For res judicata to bar a subsequent action, the claim in the second action must be “the same as the claim which was raised or which might have been raised in the prior proceeding.”

Peterson, 192 A.3d at 575 (quoting Calomiris v. Calomiris, 3 A.3d 1186, 1190 (D.C. 2010)).

Whether a “present claim is the same” for purposes of res judicata, id., depends “not [on] the theory on which a plaintiff relies” but on whether the claims share “a common nucleus of facts,”

Faulkner, 618 A.2d at 183 (internal quotation marks omitted);

see also Whiting v. Wells Fargo Bank, N.A., 230 A.3d 916, 927 (D.C. 2020)

(“It does not matter that the earlier and later proceedings differ in nature: as long as . . . the essence of the claim and evidence necessary to establish it are the same . . . .” (internal quotation marks omitted)).

In other words, “a second action may be precluded on the ground that the same claim or cause of action was advanced in the first action even though a different source of law is involved,”

Smith v. Jenkins, 562 A.2d 610, 614 (D.C. 1989)

(quoting 18 Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 4411 (2d ed. 1981)),

and res judicata will bar the subsequent litigation of affirmative claims that could have been raised in earlier litigation as a defense,

Shin, 728 A.2d at 619.

To determine whether two actions arise out of a “common nucleus of facts,” we consider “the nature of the two actions” and “whether the facts [in each] are related in time, space, origin, or motivation, whether they form a convenient trial unit, and whether their treatment as a unit conforms to the parties’ expectations or business understanding or usage.”

Faulkner, 618 A.2d at 183 (quoting Smith, 562 A.2d at 613).

While the facts underlying each claim must be closely related, they need not be a carbon copy for identity of claims to exist;

“additions to or subtractions from the central core of fact do not change this substantial identity so as to support piecemeal appeals.”

Id. (quoting Smith, 562 A.2d at 613).

In short, our analysis is “pragmatic[],” driven by the goal of “protecting adversaries from expensive and vexatious multiple lawsuits, conserving judicial resources, and minimizing the likelihood of inconsistent outcomes.”

Smith, 562 A.2d at 613, 615.

Ms. Richardson’s present suit involves the same claims that were or could have been at issue in the foreclosure action.

In this suit, Ms. Richardson alleged that the Trustees and MWC misrepresented the payoff amount and the Trustees breached their fiduciary duty to her by sending her the incorrect payoff amount.

She also claimed that the Trustees and MWC wrongly represented that Nationstar held the promissory note and that it therefore had standing to bring the foreclosure action and had the power to appoint the Trustees.

Similarly, in the foreclosure litigation, Ms. Richardson defended against the ratification of the sale and the accounting by arguing that Nationstar and MWC had failed to provide her with an accurate payoff amount;

Nationstar’s error amounted to fraudulent misrepresentation; and the Trustees’ error constituted a breach of “their fiduciary duty.”

And she defended against Nationstar’s initial claim to foreclosure by arguing that Nationstar was “not a holder in due course” of the note, and, therefore, did not have the same rights as the lender to foreclose on her property.

Although Ms. Richardson’s present suit repackages her foreclosure defenses as claims to affirmative relief, these claims involve the same facts and arguments she has already litigated.

See Stutsman v. Kaiser Found. Health Plan of Mid-Atl. States, Inc., 546 A.2d 367, 370 (D.C. 1988)

(observing that, for purposes of res judicata, whether a litigant brings a “second action under a different [legal] theory . . . is irrelevant”; res judicata hinges on whether the “factual nucleus” of the subsequent claim is the same, “not the theory upon which a plaintiff relies”).

Moreover, although Ms. Richardson’s suit additionally challenges the validity of the deed of appointment of substitute trustees in the foreclosure litigation, she could have litigated this claim as a defense in the foreclosure action given that Nationstar executed the deed in 2015—well before the 2017-2019 foreclosure litigation.

See Shin, 728 A.2d at 619 (holding that res judicata barred an affirmative claim that appellant could have raised in earlier litigation as a defense).

In short, Ms. Richardson has or could have litigated the subject matter of each of her claims in the instant suit in the foreclosure litigation.7

7 Ms. Richardson cites out-of-jurisdiction cases holding that “for res judicata purposes, claims that ‘could have been brought’” in the prior action are only those claims “in existence at the time the original complaint is filed or claims actually asserted . . . in the earlier action.”

Manning v. Auburn, 953 F.2d 1355, 1360 (11th Cir. 1992) (footnote and emphasis omitted).

Our court has never squarely addressed this question.

But see Calomiris, 3 A.3d at 1192

(holding res judicata did not bar claims that did not exist “prior to the entry of judgment” (emphasis added)); Wang

Ms. Richardson’s reliance on Molla v. Sanders, 981 A.2d 1197, 1200-02 (D.C. 2009), and Goldkind v. Snider Bros., Inc., 467 A.2d 468, 473-74 (D.C. 1983), two cases in which we concluded that litigants’ subsequent causes of action raised entirely different issues and were therefore not barred by res judicata, is misplaced. In Molla, the Superior Court rejected an ejectment suit brought by the purchaser of a property at a foreclosure sale against the property’s existing tenant because it concluded that the tenant continued to have a valid lease.8 981 A.2d at 1198. The purchaser then attempted to retroactively raise the tenant’s rent and sued the tenant for possession based on nonpayment of rent. Id. at 1198-99. We concluded that the purchaser’s second suit was not barred by the first because it raised different facts and issues—the first suit dealt only with whether the tenant’s lease survived the foreclosure, not whether the purchaser could alter the lease’s terms. Id. at 1201-02.

v. 1624 U Street, Inc., 252 A.3d 891, 898 (D.C. 2021)

(explaining that claims were not barred by res judicata when they “could not have been brought during the [prior] proceedings” (emphasis added)).

Even if we were to apply res judicata only to claims “in existence at the time the original complaint [in the earlier action] is filed or claims actually asserted . . . in the earlier action,” Manning, 953 F.2d at 1360 (footnote omitted), however, Ms. Richardson’s present claims would still be barred.

As explained above, Ms. Richardson’s present claims are all arguments that she either raised during the foreclosure/ratification litigation or—in the case of her claim about the validity of the deed of appointment—were available to her before Nationstar filed its original complaint.

8 The purchaser purported to bring claims for “wrongful detainer,” but because there is “no statutory action for ‘wrongful detainer’ in the District of Columbia,” we interpreted the action as one for ejectment.

Molla, 981 A.2d 1200.

By contrast, in both Ms. Richardson’s foreclosure case and the current litigation, she contested whether Nationstar could properly exercise rights under the deed of trust and whether she was prejudiced by the incorrect payoff letter as part of the foreclosure action.

And she could have raised the validity of the Trustees’ appointment—an issue related to the scope of Nationstar’s rights under the deed of trust—as a defense to the foreclosure sale’s ratification.

Goldkind is similarly distinct.

In Goldkind, trustees on a deed of trust won a judgment of foreclosure against the purchasers of an apartment building.

467 A.2d at 470.

Around the same time, the purchasers sued the parties who sold them the building, the broker, and an employee of the broker for fraud and other claims.

Id. at 469-70.

After the defendants moved to dismiss, this court, sitting en banc, determined that res judicata did bar the purchasers’ fraud claims against the sellers, the broker, and the employee because the purchasers could have raised those claims as a defense to the foreclosure action.

Henderson v. Snider Bros., Inc., 439 A.2d 481, 486 (D.C. 1981) (en banc).

But the division in Goldkind determined that res judicata did not bar the sellers’ crossclaims against the broker and employee to indemnify themselves from any wrongdoing on those parties’ behalf because the crossclaims—which dealt with whether the sellers and broker had an agency relationship—were unrelated to the earlier foreclosure action—which dealt with whether the purchasers had defaulted on their mortgage.

467 A.2d at 474.

Unlike the crossclaims in Goldkind, however, the issues in Ms. Richardson’s present action—whether Nationstar could bring the foreclosure action, the Trustees were properly appointed, and Ms. Richardson was prejudiced by the incorrect payoff amount—are all integrally related to whether Nationstar properly foreclosed on her property and are issues that she raised or could have raised in that litigation.

Lastly, Ms. Richardson argues that the claims in her present suit and the ones she raised in the foreclosure action are unrelated because the motivations behind the suits were different,

the Trustees experienced a conflict of interest in the foreclosure litigation,

and,

if she had brought claims against the Trustees or MWC during the foreclosure litigation, MWC would have been forced to cease its representation of Nationstar, which would have “complicate[ed] the judicial foreclosure process.”

None of these arguments is persuasive.

Ms. Richardson’s contention that her present suit—which seeks to address “the duplicitous course of conduct engaged in by . . . MWC[] [and] the Trustees” during the foreclosure proceedings—has a different motivation than Nationstar’s motive in bringing the foreclosure action sets up a false comparison.

The issue is not whether her motives in bringing the present suit aligned with Nationstar’s goals in pursuing foreclosure, but whether “the facts” she alleged in her defenses to the foreclosure/ratification litigation “are related in time, space, origin, or motivation” to the facts she alleges here.

Smith, 562 A.2d at 613.

Because the facts Ms. Richardson asserted in the foreclosure/ratification litigation were largely identical to the facts she asserts in the present litigation, and she raised these facts in both suits to argue that MWC and the Trustees engaged in misconduct, her factual assertions shared a common nucleus.

See id. at 613-14

(concluding that, where appellant raised the same sequence of events in a subsequent suit, the factual nuclei were “related in time, space, origin, and motivation”).

And neither the Trustees’ purported conflict of interest nor any procedural complexity that would have arisen had she added claims against MWC in the foreclosure litigation negates the conclusion that the facts underlying Ms. Richardson’s present claims and her defenses in the foreclosure litigation are largely the same and “form a convenient trial unit.” Id.

We therefore conclude that the claims in Ms. Richardson’s present suit are the same claims that she raised or could have raised in the foreclosure litigation, satisfying the first element of res judicata.

C.             Privity of the Relevant Parties

For res judicata to apply, the moving party must show that “the party against whom the [claims are] asserted was a party or in privity with a party in the prior case.”

Calomiris, 3 A.3d at 1190 (quoting Elwell v. Elwell, 947 A.2d 1136, 1140 (D.C. 2008)).

Based on the record before us, we agree that MWC and the Trustees did not carry their burden to show that they were in privity with Nationstar.

Johnson v. D.C. Rental Hous. Comm’n, 642 A.2d 135, 139 (D.C. 1994)

(“Res judicata is an affirmative defense that must be pleaded and established by the proponent.”).

But because it is unclear that they cannot do so, we decline to reverse and instead remand.

For a party to be in privity with another, they must be “so identified in interest . . . that [they] represent[] precisely the same legal right in respect to the subject matter of the case.”

Bell v. Weinstock, Friedman & Friedman, P.A., 285 A.3d 505, 509 (D.C. 2022)

(quoting Patton v. Klein, 746 A.2d 866, 870 (D.C. 1999)).

“Traditional categories of privies include ‘those who control an action although not parties to it . . . ; those whose interests are represented by a party to the action . . . ; [and] successors in interest.’” Patton, 746 A.2d at 870 (quoting Smith, 562 A.2d at 615).

Before the Superior Court and this court, MWC and the Trustees argued that they were in privity with Nationstar by virtue of their agency relationship and their roles as Nationstar’s counsel and trustees on the mortgage.

The trial court did not address  the  adequacy  of  these  arguments,  incorrectly  concluding  that Ms. Richardson had conceded the issue of privity by not raising it prior to her motion

for reconsideration. In fact, Ms. Richardson rightly argued in opposition to MWC and the Trustees’ motion to dismiss that their barebones assertions of privity were insufficient to carry their burden.

As we have often observed,

“[a]gents and principals . . . are not ordinarily in privity with each other.”

Bell, 285 A.3d at 509

(quoting D.C. Redevelopment Land Agency v. Dowdey, 618 A.2d 153, 163 (D.C. 1992)).

Rather,

“[a] decision on the merits in an action against the principal is res judicata in a later action against the agent only ‘if the prior action concerned a matter within the agency.’”

Id. (quoting Major v. Inner City Prop. Mgmt., Inc., 653 A.2d 379, 381 (D.C. 1995)).

Moreover,

“[a]lthough attorneys may act as agents of their clients when they act in their role as counsel,” merely showing that an attorney acted “on behalf of a client or within the scope of their agency” is not enough to establish privity between the parties.

Id. at 511.

“Even in such circumstances, the interests of attorneys may not align with their clients’ and attorneys do not have full control over litigation such that it may be automatically assumed that they had fully litigated their interests in an earlier representation of a client.”

Id.

Thus, to establish privity between an attorney and their client, the party asserting res judicata must show “a mutuality of legal interests” between the two parties.

Id. at 510.

MWC put forward no evidence or argument before the Superior Court about the “mutuality of [its] legal interests” with Nationstar.

Id.

Instead, its only argument as to why privity existed between the two was that it acted as Nationstar’s counsel.

Absent any showing as to whether MWC’s legal interests aligned with Nationstar’s, we cannot conclude that the two were in privity.

We likewise cannot conclude that privity existed between Nationstar and the Trustees.

Before the Superior Court, the Trustees’ sole argument in favor of privity was that, by virtue of their role as trustees, there was

“no viable inference that [their] involvement [in the foreclosure case] was anything other than in the context of acting as agent for the lender, Nationstar.”

But the Trustees put forward no evidence or argument about the scope of their agency relationship with Nationstar, as defined by the deed of trust or foreclosure order, nor did they directly respond to Ms. Richardson’s argument that they acted outside of the scope of their agency relationship in providing her with the incorrect payoff amount.

MWC and the Trustees may very well be able to establish privity with Nationstar on remand.

But because neither MWC nor the Trustees have so far established privity with Nationstar, the Superior Court erred in concluding on this record that res judicata applied.

III.         Conclusion

We are mindful of the fact that Ms. Richardson has been challenging the propriety of the sale of her home at foreclosure in the courts for almost a decade, resulting in expenditure of extensive judicial resources in Superior Court and multiple appeals to this court.

See 17-CV-1078, 17-CV-1165, 19-CV-0989, 21-CV-0117.

Nevertheless, for the foregoing reasons, we are constrained to reverse the dismissal of Ms. Richardson’s claims based on res judicata and to remand for further proceedings consistent with this opinion.9

On remand, we encourage the trial court to address all issues raised by the parties and to make alternative rulings as necessary, with the aim of finally resolving all of Ms. Richardson’s claims.

So ordered.

9 In addition to arguing that Ms. Richardson’s claims against them were barred by res judicata, MWC and the Trustees moved to dismiss these claims pursuant to Super. Ct. Civ. R. 12(b)(6).

The trial court did not address whether Ms. Richardson had failed to state a claim, however, and in the absence of any briefing to this court on this point, we are unable to consider whether her claims may be dismissed on alternative grounds.

Whiting, 230 A.3d at 921

(explaining that this court “may affirm the trial court’s ruling on any basis supported by the record if the appellant will suffer no procedural unfairness”).