The Third District Court of Appeal, State of Florida, recently reversed the dismissal of a mortgage foreclosure action based on the mortgagee’s failure to provide the name of the corporate representative who was to testify at trial, holding that dismissal was an overly harsh sanction given that no prejudice was shown. A copy of the opinion in Deutsche Bank Nat’l Trust Co. v. Perez, et al. is available at: Link to Opinion. In October 2009, the trustee of a mortgage-backed securities trust sued to foreclose a mortgage on real property in Miami-Dade County, Florida. In October 2014, the case was set for…
The U.S. Court of Appeals for the Seventh Circuit recently affirmed the dismissal of a breach of contract claim brought by a group of investors against a bank that purchased the assets of a failed bank in receivership, because there was no writing memorializing the alleged agreement, as required by the federal Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and the Illinois Credit Agreement Act (ICAA). A copy of the opinion in United Central Bank v. Davenport Estate LLC is available at: Link to Opinion. A bank extended loans to a group of real property investors in 2008 and also agreed…
The U.S. District Court of the Western District of North Carolina recently stayed proceedings in a suit pending the U.S. Court of Appeals for the District of Columbia’s ruling on challenges to the Federal Communication Commission’s Declaratory Ruling and Order, 30 FCC Rcd. 7961 (2015) (the “FCC Order”) under the federal Telephone Consumer Protection Act (TCPA). A copy of the opinion in Abplanalp v. United Collection Bureau, Inc. is available at: Link to Opinion. The plaintiff’s credit card agreement contained an arbitration provision requiring that all claims against the lender, including claims against third parties to whom the plaintiff’s debt was…
The U.S. Court of Appeals for the Sixth Circuit recently reversed a district court’s dismissal of a putative class action lawsuit, holding that while the district court was correct that the first-to-file rule applied because of a previous class action involving substantially the same parties and claims, it was an abuse of discretion to dismiss the present case given the jurisdictional and procedural hurdles the plaintiffs would face if forced to become part of the earlier class action filed in another federal judicial district. A copy of the opinion in Baatz v. Columbia Gas Transmission, LLC is available at: Link to Opinion.…
The U.S. Court of Appeals for the Sixth Circuit recently affirmed summary judgment in favor of a debt collector on federal Telephone Consumer Protection Act (TCPA) allegations. In so ruling, the Court held that, by providing their cellular telephone number to the primary service provider when they incurred the debt, the plaintiffs gave their “prior express consent” to be called on their cellular telephones by the debt collector of a secondary services provider, even though the debt collector did not receive the cellular telephone numbers directly from the plaintiffs. A copy of the opinion in Zachary Baisden v. Credit Adjustments, Inc.…
The U.S. Court of Appeals for the Third Circuit rejected allegations that two repossession companies violated the federal Fair Debt Collection Practices Act, holding that the companies had a right to repossess a vehicle as collateral for an unpaid loan. A copy of the opinion in Heiko Goldenstein v. Repossessors Inc. is available at: Link to Opinion. In April 2012, the borrower, a resident of Pennsylvania, obtained an online loan in the amount of $1,000 from a consumer lending company. The borrower pledged his car as collateral for the loan. Because the consumer lending company was wholly owned by a Native American tribe and…
The U.S. Court of Appeals for the Eleventh Circuit recently affirmed a district court’s order requiring borrower’s counsel to pay a servicer’s attorney’s fees under Federal Rule of Civil Procedure 11, but reversed that part of the order that imposed sanctions jointly against both borrower and her attorney under the fee-shifting provision of the federal Fair Debt Collection Practices Act, holding only the attorney was liable. A copy of the opinion in Jocelyn Y. Diaz v. The First Marblehead Corporation, et al is available at: Link to Opinion. A student loan borrower in default sued her loan servicer, alleging that the…
In a consolidated multi-district litigation putative class action involving allegations of improper handling of HAMP loan modifications by a large mortgage servicer, the U.S. Court of Appeals for the Ninth Circuit recently affirmed the district court’s order denying the putative class plaintiffs’ motion for class certification, holding that the district court correctly determined that individual issues predominated over common issues. The opinion was not published, and is non-precedential. A copy of the opinion in Hanna Bernard v. CitiMortgage Inc. is available at: Link to Opinion. Among other things, the putative class plaintiffs alleged that the defendant servicer supposedly improperly denied permanent…
The U.S. District Court for the Southern District of Alabama recently granted summary judgment in favor of a mortgage loan servicer and the trustee of a mortgage backed securities trust in a putative class action alleging violations of the federal Fair Debt Collection Practices Act (FDCPA), ruling that the “bona fide error” defense applied to the servicer and that the trustee was not a “debt collector” under the FDCPA. A copy of the opinion in Arnold v. Bayview Loan Servicing, LLC is available at: Link to Opinion. A borrower defaulted on his mortgage loan and filed a petition under Chapter 7 of…
The U.S. Court of Appeals for the Seventh Circuit recently affirmed a district court’s refusal to enjoin a bank’s state court action to collect on a promissory note and related guaranties, holding that the borrower’s appeal was frivolous and that sanctions were appropriate under Federal Rule of Appellate Procedure 38. A copy of the opinion in CFE Group, LLC v. FirstMerit Bank, NA is available at: Link to Opinion. A bank sued a corporate borrower and related parties in federal district court in 2012 to collect on a promissory note and enforce guaranties. The defendants moved to dismiss, arguing that because…
The Supreme Court of Ohio recently held that a mortgage defectively executed but properly recorded still provides constructive notice of its contents. A copy of the opinion in In re Messer is available at: Link to Opinion. The borrowers executed a promissory note and a mortgage. The notary acknowledgment on the mortgage was left blank. The mortgage was recorded with the notary section incomplete. The mortgage was later assigned. The borrowers later initiated a Chapter 13 bankruptcy asking to avoid the mortgage as defectively executed under Ohio Rev. Code § 5301.01. The U.S. Bankruptcy Court for the Southern District of Ohio…
The U.S. Bankruptcy Appellate Panel for the Eighth Circuit recently affirmed an order of the bankruptcy court granting a debtor’s motion to avoid a judgment creditor’s lien on the debtor’s residence held in tenancy by the entirety with his non-debtor spouse, holding because the lien “fixed” under the Bankruptcy Code and thus impaired the debtor’s claimed exemption, it was avoidable. A copy of the opinion in In re: Casey Drew O’Sullivan is available at: Link to Opinion. The debtor and his wife purchased their home in Missouri in 1995, taking title by the entireties. A creditor of the husband obtained a…