DENA HANOVICE PALERMO, Magistrate Judge.
Pending before this Court is The Bank of New York Mellon's ("BONY" or "Defendant") motion to dismiss.
Plaintiff Steven Charles Rathbone filed his original petition in state court, pro se, on behalf of himself and the estate of William Rathbone. Plaintiff asserts claims that arise out of a note (home equity conversion mortgage) and deed of trust that were issued in the name of William Rathbone and his wife, Betty Rathbone, both of whom are deceased. ECF No. 1 at 3-4, ECF No. 6 at 1.
Plaintiff's various claims are based on the contention that William Rathbone was not of sound mind and, therefore, lacked the capacity to enter a contract to mortgage his home at the time he executed the note. Consequently, Plaintiff claims that the note is a voidable contract. He seeks a declaratory judgment that the note is void. Id. at 13-14. Plaintiff also asserts that BONY's claims on the note were time-barred and any lien on the Property is void. Id. at 14-15. Plaintiff also seeks a declaratory judgment that he is entitled to exclusive possession of the Property and owns the Property in fee simple. Id. at 15-18.
BONY removed this case to federal court on the basis of diversity jurisdiction. ECF No. 1. Defendant then filed a verified motion to show authority, claiming that Plaintiff lacks the capacity to bring this action pro se on behalf of the estate or other heirs. ECF No. 6. Plaintiff responded and requested an abatement to cure any defect in capacity. ECF No. 10. The Court abated the case, allowing Plaintiff until November 28, 2017 to cure the deficiencies. ECF No. 12. Plaintiff failed to cure any of the deficiencies.
Defendant challenges Plaintiff's capacity to sue on behalf of the estate because (1) he has not been appointed its legal representative, and (2) he is a non-lawyer appearing pro se when there are other heirs and BONY is a creditor of the estate, precluding pro se representation. Defendant's arguments have merit.
Under Rule 17, the issue of capacity must be decided under Texas law. Fed. R. Civ. P. 17(a) & (c). Standing and capacity are often confused. Rodgers v. Lancaster Police & Fire Dep't, 819 F.3d 205, 212 n.18 (5th Cir.) cert. denied, 137 S.Ct. 304, reh'g denied, 137 S.Ct. 545 (2016). "A plaintiff must have both standing and capacity to bring a lawsuit." Austin Nursing Ctr., Inc. v. Lovato, 171 S.W.3d 845, 848 (Tex. 2005) (citation omitted) (emphasis added). Standing focuses on whether a party has a sufficient relationship with the lawsuit so as to have a "justiciable interest" in its outcome, whereas capacity "is conceived of as a procedural issue dealing with the personal qualifications of a party to litigate." Id. (citing 6A Charles Alan Wright et al., Federal Practice and Procedure: Civil § 1559, at 441 (2d ed.1990)). "A plaintiff has standing when [he] is personally aggrieved, regardless of whether [he] is acting with legal authority; a party has capacity when [he] has the legal authority to act, regardless of whether [he] has a justiciable interest in the controversy." Lovato, 171 S.W.3d at 848-49 (emphasis added).
It is undisputed that the mortgage and deed for the Property were issued to William and Betty Rathbone. ECF No. 1 at 3-4, ECF No. 6 at 1. Any claims for breach of contract or other defenses to enforceability belong to them as the parties to the contract. Neese v. Lyon, 479 S.W.3d 368, 378 (Tex. App.—Dallas), reconsideration en banc denied (Nov. 19), reh'g overruled (Nov. 19, 2015) (voidable contract is valid and effective unless and until the party entitled to avoid it takes steps to disaffirm it.); Temple EasTex, Inc. v. Old Orchard Creek Partners, Ltd., 848 S.W.2d 724, 730 (Tex. App.—Dallas 1992, writ denied) ("Generally, only parties to a contract have the right to complain of its breach."); see Restatement (Second) of Contracts § 7 (Am. Law Inst. 1981) ("A voidable contract is one where one or more parties have the power, by a manifestation of election to do so, to avoid the legal relations created by the contract, or by ratification of the contract to extinguish the power of avoidance.").
Thus, the estate would have standing to sue to void the note and deed of trust.
Because an estate lacks capacity to sue or be sued, the law grants another party the capacity to sue on the estate's behalf. Id. (quoting Lovato, 171 S.W.3d at 849). Ordinarily, only a personal representative is entitled to sue for recovery of the estate's property. See Lovato, 171 S.W.3d at 850. Although Plaintiff alleges in the Complaint that he is the personal representative of the estate, ECF No. 1-2 at ¶ 2, he has admitted that the estate was never probated and no court has appointed him as the estate's representative; consequently, he asked for an abatement to cure this deficiency. ECF No. 10 at ¶ 1. Since the abatement, Plaintiff has not filed any document to show that he has been appointed the personal representative of the estate. Defendant asserts that Plaintiff has not been appointed. ECF No. 13 ¶ 9. Thus, Plaintiff continues to lack capacity to sue as the personal representative.
BONY also challenges Plaintiff's ability to represent the estate or other heirs pro se.
The right to appear pro se in federal court is limited to an individual party conducting his own case and "those not licensed to practice law may not represent the legal interests of others." Rodgers, 819 F.3d at 210, n.11 (citing Weber v. Garza, 570 F.2d 511, 514 (5th Cir. 1978) and Guajardo v. Luna, 432 F.2d 1324 (5th Cir. 1970)); Smith v. Select Portfolio Servicing, Inc., No. 9:15-CV-61, 2017 WL 691000, at *5 (E.D. Tex. Jan. 31), adopted, 2017 WL 679742 (E.D. Tex. Feb. 21, 2017) (same); see 28 U.S.C. § 1654 (parties in federal cases are authorized to "plead and conduct their own cases personally or by counsel.").
In a case of first impression, the Fifth Circuit held that a "person with capacity under state law to represent an estate in a survival action may proceed pro se if that person is the only beneficiary and the estate has no creditors." Rodgers, 819 F.3d at 210 (emphasis added). The purpose of the rule is to protect third parties from having an ill equipped non-lawyer squander their rights away. Id. (citing Bass v. Leatherwood, 788 F.3d. 228, 230-31 (6th Cir. 2015)). Because the risk of waiver or abandonment of an issue is high, the courts will not allow a pro se litigant to represent another person. Id. at 210 (citing Guest v. Hansen, 603 F.3d 15, 19-21 (2nd Cir. 2010)).
Plaintiff admits that he is not a lawyer. ECF No. 10 at ¶ 2. In fact, a search of the Texas State Bar website does not contain any lawyer with Plaintiff's name.
Defendant asks the Court to dismiss the estate's claims with prejudice. ECF No. 13 ¶ 11. However, since the Plaintiff had no capacity to sue on its behalf, the estate's claims should be dismissed without prejudice. See, e.g., Shamsid-Deen, 2014 WL 1917579, at *2.
Pursuant to Rule 12(b)(6), Defendant seeks dismissal with prejudice of the Plaintiff's individual claims. When proceeding pro se, Plaintiff only has the authority and standing to bring causes of action for injuries he suffered individually. Rodgers, 819 F.3d at 210. Even taking the Plaintiff's allegations as true, there are no pled facts to support any cause of action asserted for Plaintiff individually, much less that he has personally suffered an injury that is "both `concrete and particularized.'" See Smith, 2017 WL 691000, at *5-6 (quoting Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 180 (2000)) (citing Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1545(2016)). Article III requires the plaintiff to have a direct, personal stake in the outcome of the suit, and he has not stated facts indicating that this requirement is met as to the claims he asserted individually. See id. at *6 (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992)).
At Plaintiff's request, the Court previously abated the case to allow him to cure the deficiencies and permitted Plaintiff to amend his pleading to allege his individual claims, but he failed to file an amended pleading. Because the Plaintiff has not alleged any facts supporting his individual injury, granting leave to amend would be an exercise in futility. See Brewster v. Dretke, 587 F.3d 764, 767-68 (5th Cir.), cert. denied, 560 U.S. 944 (2010) (citing Bazrowx v. Scott, 136 F.3d 1053, 1054 (5th Cir. 1998) (per curiam)) (generally, a pro se litigant should be offered an opportunity to amend his complaint before it is dismissed); Smith, 2017 WL 691000, at *6 (same). Thus, Plaintiff's individual claims should be dismissed with prejudice.
The Court
All other relief should be
The Parties have fourteen days from service of this Report and Recommendation to file written objections. 28 U.S.C. § 636(b)(1)(C); Fed. R. Civ. P. 72(b). Failure to file timely objections will preclude appellate review of factual findings or legal conclusions, except for plain error. Ortiz v. San Antonio Fire Dep't, 806 F.3d 822, 825 (5th Cir. 2015).