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Posts published by “Eric Tsai”

MD Tenn. Holds Auto Finance Creditor’s Telephone Authorization Process Complied With EFTA

The U.S. District Court for the Middle District of Tennessee recently held that a creditor complied with the federal Electronic Funds Transfer Act when it obtained verbal authorization to accept the consumer’s electronic fund transfer and request for enrollment into an autopay system. In so ruling, the Court held that the creditor was not required to send the consumer a copy of his electronic signature (the recording).  Instead, the Court held, the written confirmation of enrollment need only include the material terms of the autopay system, and sending the confirmation of enrollment within two business days of the date of…

Calif. App. Court (2nd Dist) Holds Res Judicata Did Not Bar TILA Action Based on Prior Contract Action

The Court of Appeal of California, Second District, recently held the dismissal of a borrower’s breach of contract claim in a prior lawsuit did not bar a claim in a subsequent lawsuit for violation of the federal Truth in Lending Act, 15 U.S.C. § 1601, et seq., even if the breach of contract and TILA claims were based on the same set of underlying facts, because the right to full disclosures under TILA was a distinct primary right from the common law rights in contract. However, although the Appellate Court determined that the dismissal based on the doctrines of res…

8th Cir. BAP Holds Secured Creditor Has No Duty to Verify Ownership or Possession of Collateral

The Bankruptcy Appellate Panel for the Eighth Circuit recently held that a secured creditor obtained a valid lien on collateral because technical defects in the bill of sale did not invalidate a transfer of title to the collateral, and rejected the argument that the secured creditor should have inspected the bill of sale before advancing funds. A copy of the opinion in In re Leonard is available at:  Link to Opinion. This was a dispute over the validity and priority of interest in collateral in goods.  The seller sold the collateral to the debtor, a broker who delivered the collateral…

9th Cir. Holds TCPA Revocation of Consent Must Be Clearly Expressed

The U.S. Court of Appeals for the Ninth Circuit recently held that under Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 194 L. Ed. 2d 635 (2016), a consumer alleged a concrete injury sufficient to confer Article III standing to pursue a Telephone Consumer Protection Act claim for alleged nonconsensual text messages. In so ruling, the Court held that a consumer may revoke his or her consent, but must clearly express that he or she does not want to receive the messages or calls. The Court concluded that, in this case, the consumer gave prior express consent to receive the…

4th Cir. Holds Escrow, Other Principal Residence Mortgage Loan Items Not Subject to Chapter 13 Bifurcation

The U.S. Court of Appeals for the Fourth Circuit recently held that “escrow funds, insurance proceeds, or miscellaneous proceeds” are protected by the anti-modification provisions for Chapter 13 bankruptcies as “incidental property” under the definition of “debtor’s principal residence” in the federal Bankruptcy Code. A copy of the opinion in In re Birmingham is available at:  Link to Opinion. A debtor filed a voluntary petition for Chapter 13 bankruptcy. One of the claims against the debtor was a mortgage loan secured by a deed of trust on the debtor’s primary residence.  When the debtor filed his original Chapter 13 bankruptcy…

Nevada Fed. Court Denies Class Cert. on ‘Ascertainability’ Grds., Fannie/Freddie Liens Not Extinguished by HOA Foreclosure

The U.S. District Court for the District of Nevada recently confirmed that a homeowner association’s foreclosure of its superpriority lien cannot extinguish a property interest of Fannie Mae or Freddie Mac while those entities are under the Federal Housing Finance Agency’s (FHFA) conservatorship. In so ruling, the Court also denied class certification, holding that the issue of whether Fannie Mae or Freddie Mac held an interest in the property at issue at the time of a homeowner association foreclosure sale presents an impermissible individualized factual inquiry that would require “mini-trials” as to each affected property. A copy of the opinion…

Fla. App. Court (5th DCA) Holds Borrower’s Surrender in Bankruptcy Resolves Contested Foreclosure

As an example of the conflicting and contrasting court rulings on the effect of surrender in bankruptcy (see our prior update), the District Court of Appeal of the State of Florida, Fifth District, recently dismissed a borrower’s appeal from a final judgment of foreclosure because the borrower admitted during the course of his bankruptcy proceeding that he owed the mortgage debt and stated his intention to surrender the mortgaged property. A copy of the opinion in Rivera v. BAC Home Loans is available at: Link to Opinion. A mortgage loan borrower filed for bankruptcy relief while his appeal of a foreclosure…

SD Fla. Bankr. Rejects Mortgagee’s Attempt to Use Borrower’s Surrender in BK to Resolve Contested Foreclosure

The U.S. Bankruptcy Court for the Southern District of Florida recently denied a creditor’s motion to compel the debtor to surrender mortgaged property and also denied the debtor’s motion to stay the case, holding that a chapter 7 debtor who indicates surrender of real property in his statement of intention is not obligated to surrender that property to the lienholder, whether or not the property is administered by the chapter 7 trustee. Disagreeing with other judges in the same district and elsewhere on this issue, the bankruptcy judge held that “[c]ompulsory surrender of real property collateral by a debtor to…

Nevada Supreme Court Holds HOA Superpriority Lien Does Not Include Atty Fees, Collection Costs

The Supreme Court of Nevada recently held that a superpriority lien for common expense assessments pursuant to Nevada Revised Statutes (NRS) 116.3116(2) does not include collection fees and foreclosure costs incurred by a homeowners’ association. In so ruling, the Court also held that an HOA’s covenants, conditions, and restrictions (“CC&Rs”) that purport to create a superpriority lien covering a different period of time than allowed by NRS 116.3116(2) is superseded and negated by the statute. A copy of the opinion in Horizons at Seven Hills Homeowners Association v. Ikon Holdings, LLC is available at:  Link to Opinion. The HOA recorded its…

Calif. App. Court Upholds Dismissal of Allegations Contradicting Judicially Noticed Purchase and Assumption Agreement

The Court of Appeal of the State of California, First Appellate District, recently upheld a trial court’s demurrer without leave to amend in a case in which a judicially noticed Purchase and Assumption Agreement (“P&A Agreement”) contradicted the borrower’s allegations that a subsequent purchaser of the loan had no authority to foreclose on her property. A copy of the opinion in Brown v. Deutsche Bank National Trust Company as Trustee for WAMU Mortgage Pass-Through Certificates Series et al. can be found at:  Link to Opinion. In 2004, a borrower obtained a $450,000 loan secured by a deed of trust recorded against…

ND California Holds 2015 TCPA Amendment Applies to Collection Calls Made in 2014

The U.S. District Court for the Northern District of California recently held that an amendment to the federal Telephone Consumer Protection Act (TCPA) enacted as part of the Bipartisan Budget Act of 2015 applies to calls made in 2014 “solely to collect a debt owed to or guaranteed by the United States,” and therefore granted summary judgment in favor of the defendant. A copy of the opinion in Silver v. Pennsylvania Higher Education Assistance Agency is available at:  Link to Opinion. The plaintiff filed a putative class action under the TCPA alleging that, in or around January 2014, the defendant student…

Illinois Bankruptcy Court Rejects Crawford, Finds Time-Barred Claims Permissible ­

A recent decision from a United States Bankruptcy Court in the Northern District of Illinois provides a detailed analysis of why proofs of claim on “time-barred” debt do not violate the federal Fair Debt Collection Practices Act (FDCPA) or the Bankruptcy Code. The decision, Glenn v. Cavalry Investments, LLC, is among the growing number of decisions rejecting Crawford v. LVNV from the Eleventh Circuit Court of Appeals. A copy of the opinion is available at: Link to Opinion. The debtor, Darryl Glenn, voluntarily commenced a chapter 13 bankruptcy in August 2014.  The creditor, Cavalry Investments, filed a timely proof of…