Tag Archives: misrepresent

Georgia Court Dismisses HOEPA, RESPA, and TILA Claims

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The court in deciding Mitchell v. Deutsche Bank Nat’l Trust Co., 2013 U.S. Dist. (N.D. Ga., 2013) ultimately dismissed the plaintiff’s complaint with prejudice.

The plaintiff’s complaint alleged federal violations of the Truth-in-Lending Act (“TILA”), the Real Estate Settlement and Procedures Act (“RESPA”), and the Homeownership Equity Protection Act (“HOEPA”).

The Complaint also asserted the following Georgia state law claims: (1) fraud; (2) wrongful foreclosure; (3) quiet title; (4) slander of title; (5) infliction of emotional distress and (6) unfair business practices.

In reviewing the plaintiff’s complaint, the court found that the plaintiffs had failed to plead a cognizable claim to support their claims. Thus, after considering the plaintiff’s arguments, the court dismissed all claims with prejudice.

Georgia Court Finds that MERS Was Within Its Right in Transferring and Assigning Deed, Along with Power of Sale, to Another Party

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The court in deciding Brannigan v. Bank of Am. Corp., 2013 U.S. Dist. (N.D. Ga., 2013) found that MERS could transfer and assign the deed, along with the power of sale, to another party.

After Plaintiffs defaulted on their mortgage, U.S. Bank initiated non-judicial foreclosure proceedings. Plaintiffs Wade and Angelina Brannigan initiated this action and requested that the court set aside a foreclosure sale on the grounds of wrongful foreclosure.

Plaintiff asserted that U.S. Bank, Bank of America, the Albertelli Firm, and MERS conspired to file an alleged ‘Transfer and Assignment,’ whereby MERS purported to transfer, sell, convey and assign to U.S. Bank all of its right, title and interest in and to the security deed. Plaintiffs argued, “MERS retained no interest in their security deed to transfer, and said transfer and assignment were not only fraudulent but a legal nullity” as plaintiffs’ mortgage loan had already been assigned to LaSalle Bank.

In regards to the plaintiff’s claim against MERS, the court found that the plaintiffs executed a security deed listing MERS as grantee and nominee for the lender and its successors and assigns. By the terms of the security deed, MERS could transfer and assign the deed, along with the power of sale, to another party, and did so by transferring it to U.S. Bank. Moreover, the court noted that under Georgia law, the security deed assignee “may exercise any power therein contained,” including the power of sale in accordance with the terms of the deed. O.C.G.A. § 23-2-114.

Therefore, even if Plaintiffs had standing to challenge the assignment, by the terms in the security deed U.S. Bank was within its authority to foreclose after Plaintiffs’ default.

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The court in deciding Brannigan v. Bank of Am. Corp., 2013 U.S. Dist. (N.D. Ga., 2013) agreed with the defendants that the plaintiffs’ complaint failed to state a claim upon which relief could be granted and was to be dismissed under Rule 12(b)(6).

Plaintiffs filed an action asserting several state-law claims related to wrongful foreclosure. The claims against the defendants also included: fraud, intentional misrepresentation, and deceit (Count One); negligent misrepresentation (Count Two); negligence (Count Three); wrongful foreclosure (Count Four); and violations of the Fair Credit Reporting Act (Count Six).

Plaintiffs contended that the defendants wrongfully foreclosed on their property.
Plaintiffs challenged the assignment of the security deed from MERS to U.S. Bank as wholly void, illegal, ineffective and insufficient to transfer any interest to anyone.

Defendants argued that the plaintiffs lacked standing to challenge the validity of the assignment. The court ultimately agreed. The court noted that the plaintiffs could not challenge the assignment’s validity because they were not parties to the assignment or intended third-party beneficiaries.

Next, the plaintiffs argued that the assignment from MERS to U.S. Bank was invalid because after the mortgage loan was assigned to LaSalle Bank, MERS retained no interest in the plaintiff’s security deed to transfer.

The court noted that the plaintiffs executed a security deed listing MERS as grantee and nominee for the lender and its successors and assigns. By the terms of the security deed, MERS could transfer and assign the deed, along with the power of sale, to another party, and did so by transferring it to U.S. Bank. Therefore, the court reasoned that even if the plaintiffs had standing to challenge the assignment, by the terms in the security deed, U.S. Bank was within its authority to foreclose after the plaintiffs’ default.

Finally, the plaintiffs claimed that the defendant Albertelli Firm’s notice of default was inadequate because it “failed to properly identify the secured creditor, note holder and loan servicer.” The court found that the defendants complied with Georgia’s notice requirements. Therefore, the plaintiff could not state a claim for wrongful foreclosure.

Georgia Court Dismisses Plaintiff’s RESPA, TILA and HOEPA Claims

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The court in deciding Mitchell v. Deutsche Bank Nat’l Trust Co., 2013 U.S. Dist. (N.D. Ga., 2013) found no plain error in the lower court’s conclusion to dismiss the plaintiffs’ claims.

Plaintiffs Reginald and Jamela Mitchell filed a complaint against Deutsche Bank and MERS, the complaint alleged federal violations of the Truth-in-Lending Act (“TILA”), the Real Estate Settlement and Procedures Act (“RESPA”), and the Homeownership Equity Protection Act (“HOEPA”).

The Complaint also asserted the following state law claims: (1) fraud; (2) wrongful foreclosure; (3) quiet title; (4) slander of title; (5) infliction of emotional distress and (6) unfair business practices.

The crux of the plaintiffs’ claims under the federal statutes was that the defendants failed to provide them with the required disclosures, thereby allowing plaintiffs to rescind their mortgage transaction and seek damages. The lower court concluded that the Plaintiffs’ claims arising under TILA, HOEPA and RESPA were barred by the statute of limitations. The lower court recommended that the plaintiffs’ complaint be dismissed as the plaintiffs failed to state any federal or state law claim upon which relief could be granted. The plaintiff then appealed.

Upon review of the lower court’s decision, this court found no plain error in the lower court’s findings and recommendation that the defendants’ motion to dismiss plaintiffs’ claims be granted.