Tag Archives: assignment

Supreme Court of Vermont Denied a Motion Requesting a Declaration That U.S. Bank Had Violated Vermont’s Consumer Fraud Act (CFA)

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The court in deciding Dernier v. Mortgage Network, Inc., 2013 VT 96 (Vt. 2013) reversed the trial court’s dismissal of the counts that alleged irregularities in the transfer of the note and mortgage unconnected to the PSA. The court also partially remanded certain claims.

Plaintiff borrowers brought suit against defendant bank in which they sought a declaratory judgment that defendant had no right to enforce either a note or a mortgage and that defendant had violated the Consumer Fraud Act (CFA).

Plaintiffs appealed the dismissal for failure to state a claim, of their action for (1) a declaratory judgment that defendant U.S. Bank National Association cannot enforce the mortgage and promissory note for the debt associated with plaintiffs’ purchase of their house based on irregularities and fraud in the transfer of both instruments, (2) a declaration that U.S. Bank has violated Vermont’s Consumer Fraud Act (CFA) by asserting its right to enforce the mortgage and note, and (3) attorney’s fees and costs under the CFA.

Plaintiffs also appealed the trial court’s failure to enter a default judgment against defendant Mortgage Electronic Registration Systems, Inc. (MERS). After considering the merits of both claims, the court ultimately affirmed in part and reversed in part.

Georgia Court Dismisses Wrongful Foreclosure Claim

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The court in deciding Bowman v. U.S. Bank Nat’l Ass’n, 2013 U.S. Dist. LEXIS 149660 (N.D. Ga. 2013) eventually granted the defendant’s motion to dismiss.

Plaintiff’s complaint was wide-ranging and repetitive, the gravamen of the complaint was a wrongful foreclosure claim which was premised on plaintiff’s allegations that: (1) Castle Rock Trustee was not the “secured creditor,” (2) the actual “secured creditor” was not identified to plaintiff in any notice, (3) the Castle Rock Trustee did not send notice of the November 6, 2012, foreclosure sale to plaintiff, (4) the assignments were invalid, and (5) the discharge of the underlying debt in a Chapter 7 bankruptcy case precluded foreclosure.

The court eventually held that plaintiff had fraudulently joined the LLC did not defeat diversity; the value of the property was the appropriate benchmark for the amount in controversy and there was no dispute that tax records value the property at $188,900. The court also found that plaintiff’s Chapter 7 discharge did not bar defendants from initiating foreclosure proceedings against the property nor did the Chapter 7 discharge render “false” defendants description that plaintiff had failed to pay the mortgage debt.

The court also found that plaintiff’s complaint failed to state a claim for wrongful foreclosure due to errors in the Foreclosure Notice where the Notice was sent to the property address, which was authorized under the statute, and plaintiff had not alleged that he requested the Notice be sent to an alternate address.

After considering the merits of both claims, the court ultimately agreed with the defendant and granted the defendant’s motion to dismiss, and dismissed with prejudice.

Michigan Court Dismisses Fraud & RESPA Claims

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The court in deciding Neroni v. Bank of Am., N.A., 2013 U.S. Dist. LEXIS 149190 ( E.D. Mich. 2013) eventually granted the defendant’s motion to dismiss.

Plaintiffs alleged claims against defendant [Bank of America, N.A.] for infringement of the Real Estate Settlement Procedures Act (“RESPA”) (Counts I–IV), common law fraud (Count V), common law silent fraud (Count VI), and common law breach of contract (Count VII).

Defendant responded by asserting that plaintiffs’ RESPA claims should be dismissed because (1) defendant had no legal obligation under RESPA to respond or, alternatively, (2) plaintiffs failed to plead any actual damages related to their RESPA claims. Defendant further asserted that plaintiffs had failed to adequately plead claims for fraud or breach of contract relating to defendant’s legal standing to foreclose on Plaintiffs’ Home.

After considering the merits of both claims, the court ultimately agreed with the defendant and granted the defendant’s motion to dismiss.

Court Dismisses Plaintiffs’ RESPA Claims Because Defendant Was Not Under Legal Obligation to Respond to Plaintiffs

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The court in deciding Neroni v. Bank of Am., N.A., 2013 U.S. Dist. LEXIS 149190 ( E.D. Mich. Oct. 17, 2013) granted defendant’s motion to dismiss plaintiffs’ complaint pursuant to F.R.C.P. 12(b)(6).

Plaintiffs alleged several claims in their complaint against Defendant for infringement of the Real Estate Settlement Procedures Act (“RESPA“) (Counts I–IV), common law fraud (Count V), common law silent fraud (Count VI), and common law breach of contract (Count VII).

Defendant asserted that plaintiffs’ RESPA claims should be dismissed because (1) defendant had no legal obligation under RESPA to respond or, alternatively, (2) plaintiffs failed to plead any actual damages related to their RESPA claims.

Defendant further asserts that plaintiffs have failed to adequately plead claims for fraud or breach of contract relating to defendant’s legal standing to foreclose on plaintiffs’ Home. After considering both sides’ arguments, the court agreed with the defendant’s reasoning and dismissed the case.

Michigan Court Dismisses Fair Debt Collection Practices Act Claim

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The court in deciding Mullins v. Fannie Mae, 2013 U.S. Dist. LEXIS 150718 (E.D. Mich. 2013) granted the defendant’s motion to dismiss.

The plaintiff brought six causes of action: Count I—Fraudulent Misrepresentation; Count II—Estoppel; Count III—Negligence; Count IV—Violation of the Regulation of Collection Practices Act; Count V—Violation of the Fair Debt Collection Practices Act; and Count VI—violation of the Michigan Consumer Protection Act.

The court dismissed the plaintiff’s fraud claims because the plaintiff had not provided a signed writing by an authorized representative of Fannie Mae regarding a promise to modify her loan. The court noted that even if she had stated a claim of fraud, her claim must be dismissed.

With regards to the plaintiff’s negligence claims, the court found that Fannie Mae had no duty to review, thus there could be no breach.

Under Michigan law, the Regulation of Collection Practices Act (“RCPA”) governs the collection practices of certain persons. However, after considering the plaintiff’s argument, the court found that the statute did not authorize a claim based upon a plaintiff’s reluctance to dispute the validity of a debt because of the timing of the validation. Citing similar grounds, the court ultimately dismissed the remaining claims.

District Court Rejects Claims That MERS Lacked Standing

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The court in deciding Pratt v. Bank of Am. NA, 2013 U.S. Dist. LEXIS 151671 (D. Me. 2013) granted Bank of America’s motion to dismiss.

Plaintiff alleged that the existence of forged documents related to a mortgage loan and that MERS lacked standing to transfer the plaintiff’s deed to Bank of America. The plaintiff wanted his promissory note returned to him along with the deed of trust.

The plaintiff’s assertion revolved around the claim that the separation of the deed of trust from the promissory note by the intervention of MERS as a nominee for Quicken Loans somehow breached the contracts between Pratt and Quicken or Bank of America. Plaintiff claimed that MERS, as nominee, had no “standing” to transfer the note and/or mortgage to Bank of America and that Bank of America has no “standing” to enforce these instruments.

Bank of America filed a motion to dismiss. The court denied the plaintiff’s motion to remand and his motion for entry of default. The court also granted Bank of America’s motion to dismiss.

Lower Court’s Grant of Summary Judgement Affirmed by Nevada Court

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The court in deciding Castro v. Bank of N.Y. Mellon, 2013 Nev. LEXIS 1602 (Nev. 2013) affirmed the lower courts judgment against the plaintiff.

Plaintiff obtained a home loan from Decision One Mortgage Company, LLC and executed a promissory note in favor of Decision One. The note was secured by a deed of trust naming Decision One as the lender and MERS, as the beneficiary and nominee of the lender. The deed of trust authorized MERS, as nominee of the lender, to transfer the deed of trust and appoint a successor trustee.

MERS assigned the deed of trust to defendant, who instituted this action for quiet title seeking to expunge the documents that appellants recorded. Defendant moved for summary judgment, which was not opposed by plaintiff. Plaintiffs provided no evidence of any kind to the district court, and the district court entered summary judgment in respondent’s favor.

The court considered the plaintiff’s assertions, and concluded that the district court properly entered summary judgment in defendant’s favor.