# Auburn Hills Homeowners Association v. New Page Properties, L.L.C.

> District Court, W.D. Missouri · October 12, 2022

URL: https://www.frixlaw.com/law-library/cases/10242593

## Case

- **Court:** District Court, W.D. Missouri
- **Decided:** October 12, 2022
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
CENTRAL DIVISION

AUBURN HILLS HOMEOWNERS
ASSOCIATION,

Plaintiff,

v.
Case No. 2:22-cv-4102-NKL
NEW PAGE PROPERTIES, LLC,

Defendant.

ORDER
Before the Court is a Motion to Dismiss for Lack of Subject Matter Jurisdiction filed by
Defendant New Page Properties, LLC. See Doc. 6. New Page argues that the Complaint filed by
Plaintiff Auburn Hills Homeowners Association, Doc. 1, which attempts to state claims for breach
of contract and a declaratory judgment, fails to establish that this Court can exercise its subject
matter jurisdiction. As discussed in detail below, the Court agrees, and accordingly this case is
DISMISSED.
I. BACKGROUND
Auburn Hills Homeowners Association (the “HOA”) is a homeowner’s association
responsible for various parcels of land in Boone County, Missouri. The HOA is empowered by
the Declaration of Covenants, Easements and Restrictions of Auburn Hills, a Subdivision of Boone
County Missouri (the “Declaration”) to enforce the requirements of the Declaration against
property owners. Doc. 1, ¶¶ 10–13. Defendant New Page Properties, LLC owns property subject
to the Declaration. Id. ¶¶ 8–9, 14. The HOA is entitled to fine property owners who violate the
Declaration, initiate litigation, and recover the attorneys’ fees and costs it incurs enforcing the
Declaration. The HOA fined New Page because it has allegedly failed to properly maintain its
property, in violation of the Declaration. New Page has not paid the fines. The HOA anticipates
that New Page will argue that the HOA’s enforcement efforts1 are discriminatory, in violation of
the Fair Housing Act.2
On July 1, 2022, the HOA filed a Complaint in this Court. The HOA seeks a declaration,

pursuant to the Declaratory Judgment Act,3 that it has not violated the Fair Housing Act. The
HOA further brings a breach of contract claim against New Page for failing to comply with the
Declaration. The HOA claims federal jurisdiction is proper under the Fair Housing Act—
specifically 42 U.S.C. § 3613(a)(1).
II. STANDARD
The party seeking to invoke federal jurisdiction “must sufficiently allege the basis for
federal subject matter jurisdiction in its complaint.” Victor Foods, Inc. v. Crossroads Economic
Dev. of St. Charles County, Inc., 977 F.2d 1224, 1227 (8th Cir. 1992); Bowe v. Northwest Airlines,
Inc., 974 F.2d 101, 103 (8th Cir. 1992). A motion for lack of subject matter jurisdiction under
Fed. R. Civ. P. 12(b)(1) can be facial or factual. Titus v. Sullivan, 4 F.3d 590, 593 (8th Cir. 1993).

In the context of a facial challenge, like the one before the Court, the Complaint’s factual
allegations are presumed true, and the Court, looking only at the face of the Complaint, determines

1 New Page’s exact theory of discrimination is unclear, but it is ultimately irrelevant to the
resolution of its Motion to Dismiss. At bottom, it appears the HOA anticipates that New Page will
argue that either the Declaration, or the HOA’s enforcement of it, is discriminatory and therefore
New Page is not liable for the fines levied against it. There is no suggestion that New Page
anticipates filing an independent cause of action against the HOA for violating the Fair Housing
Act.

2 42 U.S.C. § 3601 et seq.

3 28 U.S.C. § 2201.
whether an “element necessary for subject matter jurisdiction” is missing. Id.
III. DISCUSSION
The federal Declaratory Judgment Act is a procedural statute, not a jurisdictional one. See
Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 15–16 (1983); Skelly Oil
Co. v. Phillips Petroleum Co., 339 U.S. 667, 671–72 (1950). It is meant to “provide an additional

remedy where [federal] jurisdiction already exists.” Terminal Freight Handling Co. v. Solien for
& on Behalf of N. L. R. B., 444 F.2d 699, 703 (8th Cir. 1971). Therefore, a federal court will not
have jurisdiction over an action seeking a declaratory judgment unless it otherwise comes within
a traditional congressional grant of jurisdiction. State of Mo. ex rel. Missouri Highway & Transp.
Comm’n v. Cuffley, 112 F.3d 1332, 1334 (8th Cir. 1997); Terminal Freight Handling Co. v. Solien,
444 F.2d 699, 703 (8th Cir. 1971).
The HOA attempts to invoke the Court’s federal question jurisdiction, meaning it believes
it pleads “civil actions arising under the Constitution, laws, or treaties of the United States.” 28
U.S.C. § 1331; Doc. 1 (Complaint), at ¶ 1.4 To do so successfully, the federal question must appear
on the face of the plaintiff’s complaint; said differently, the plaintiff’s “well-pleaded complaint

must establish that the cause of action arises under federal law.” See Franchise Tax Board, 463
U.S. at 10; Gully v. First Nat’l Bank, 299 U.S. 109, 113 (1936); Louisville & Nashville R.R. v.
Mottley, 211 U.S. 149, 152 (1908).
The existence of a potential federal defense to a state law claim normally does not create
federal question jurisdiction. Aetna Health, Inc. v. Davila, 542 U.S. 200, 207 (2004). Because of
that, when “a declaratory judgment complaint essentially invokes a federal-law defense to a state-

4 For the avoidance of doubt, it is clear from the face of the Complaint that the parties are both
citizens of Missouri, and therefore this case could not be premised on diversity. See Doc. 1, at ¶¶
4–7.
based claim, it is the character of the threatened state action that determines whether federal courts
have jurisdiction.” Gaar v. Quirk, 86 F.3d 451, 454 (5th Cir. 1996).
The HOA filed its breach of contract claim—arising under state law—to remedy New
Page’s violations of the Declaration. The only federal issue—the Fair Housing Act—appears in
two ways, neither of which support federal jurisdiction.

First, the HOA appears to argue that its claim arises under the Fair Housing Act. See Doc.
1, at ¶ 1. This argument fails. There are no allegations to support the HOA’s reliance on 42 U.S.C.
§3613(a)(1) as an independent source of jurisdiction. § 3613(a)(1) of the Fair Housing Act permits
an aggrieved person—a person who has been, or believes that she will soon be, subjected to a
discriminatory housing practice—to challenge that practice in federal court. 42 U.S.C. §
3613(a)(1); 42 U.S.C. § 3602(i). The HOA is not an aggrieved person, and therefore it cannot
itself proceed under the cited portion of the Fair Housing Act.
Second, the HOA anticipates that New Page may use the Fair Housing Act as a defense to
the HOA’s state law breach of contract claim. See generally Doc. 11 (Pl.’s Opp’n to Mot.

Dismiss), at 1–2. The HOA therefore asks this Court to preemptively declare that federal law does
not prevent its enforcement efforts.5 That is not enough to establish subject matter jurisdiction.
Pittman Farms v. Kuehl Poultry LLC, 19-CV-3040, 2020 WL 2490048, at *2 (D. Minn. May 14,
2020) (“However, the traditional coercive cause of action implicated by [plaintiffs’ declaratory
judgment action] . . . is a breach-of-contract suit in which the federal question presented here—the
constitutionality of Minnesota law—would be raised only as an affirmative defense . . . That is not
enough to trigger federal subject-matter jurisdiction under Skelly Oil and § 1331.”) (internal

5 As discussed above, nowhere is there any suggestion that the HOA anticipates New Page filing
a claim against the HOA for violating the Fair Housing Act. It appears only that New Page will
raise the Fair Housing Act as a defense to its liability under the Declaration.
citations omitted); Gully v. First Nat. Bank, 299 U.S. 109, 113 (1936) (“Indeed, the complaint
itself will not avail as a basis of jurisdiction in so far as it goes beyond a statement of the plaintiff's
cause of action and anticipates or replies to a probable defense.”); N. Cent. F.S., Inc. v. Brown, 951
F. Supp. 1383, 1397 (N.D. Iowa 1996) (“Thus, the threatened or actual action prompting the purely
declaratory claims here is a state-law breach-of-contract suit to which the assertedly federal issue

of the illegality of the HTAs under [federal law] is an affirmative defense.”).
The HOA does not address any of New Page’s jurisdictional arguments. Instead, it argues
only that its declaratory judgment action is properly in federal court because it is “definite and
concrete, touching the legal relations of parties having adverse legal interests. It [is] a real and
substantial controversy admitting of specific relief through a decree of conclusive character, as
distinguished from an opinion advising what the law would be upon a hypothetical state of facts.”
Doc. 11 (Opp’n to Mot. Dismiss), at 3 (citing Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 241
(1937)). Even accepting that this is all true, the HOA’s arguments do nothing to establish this
Court’s subject matter jurisdiction, a completely distinct—but equally necessary—inquiry.

At bottom, the HOA argues that federal question jurisdiction exists because “the Court
must construe The Fair Housing Act, and such construction will either give plaintiff the right to
enforce the Declaration against defendant’s properties, or it will be found discriminatory and, thus,
unenforceable.” Doc. 11, at 3. While that may be true, the HOA’s underlying right to recovery—
its breach of contract action—does not arise under federal law. The HOA merely seeks to use a
declaratory judgment action as a vehicle to preemptively raise—and defeat—New Page’s potential
federal defense to the HOA’s state court breach of contract action. Gully, 299 U.S. at 113. This
is not enough for federal question jurisdiction. Accordingly, the Missouri Courts must decide in
the first instance whether any Fair Housing Act defense has merit. Davila, 542 U.S. at 207; Int’l
Ass’n of Entrepreneurs of Am. v. Angoff, 58 F.3d 1266, 1270 (8th Cir. 1995) (“[T]he Declaratory
Judgment Act is not to be used to bring to the federal courts an affirmative defense which can be
asserted in a pending state action.”); Gaar v. Quirk, 86 F.3d 451, 454 (5th Cir. 1996) (“A petition
for declaratory judgment concerning federal law is not sufficient to create federal jurisdiction;
hence the relevant cause of action must arise under some other federal law[.]”) (quotation omitted);

N. Cent. F.S., Inc., 951 F. Supp. at 1400 (dismissing for lack of subject matter jurisdiction a
declaratory judgment action seeking declaration that certain contracts were legal under federal law,
anticipating the illegality defense of opposing party).
IV. CONCLUSION
For the reasons discussed above, Defendant’s Motion, Doc. 6, is GRANTED.

s/ Nanette K. Laughrey Dated: 10/12/2022
NANETTE K. LAUGHREY Jefferson City, Missouri
United States District Judge

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10242593. Public record. Not legal advice.