The U.S. Court of Appeals for the Eleventh Circuit recently affirmed a summary judgment ruling in favor of a mortgage servicer, holding that the servicer had no duty to respond to a Qualified Written Request (“QWR”) under the federal Real Estate Settlement Procedures Act (RESPA) because the borrower failed to send the QWR to the servicer’s designated address for QWR receipt. A copy of the opinion in Bivens v. Bank of America, NA is available at: Link to Opinion. A mortgage servicer sent a letter to a borrower advising that the lender transferred the servicing of the borrower’s mortgage loan to…
The U.S. District Court for the Eastern District of New York recently granted in part and denied in part a mortgage servicer’s motion to dismiss a borrower’s claim that the servicing transfer notice supposedly violated the federal Fair Debt Collection Practices Act (FDCPA) because it allegedly did not disclose that the debt was increasing due to interest, and that a “door knocker” notice posted on the borrower’s door failed to state that it was from a debt collector. The Court held that under Avila v. Riexinger & Associates, LLC, 817 F.3d 72 (2d Cir. 2016), a debt collector must disclose…
The U.S. Court of Appeals for the Sixth Circuit recently affirmed a bankruptcy court’s order granting the debtors’ motion to compel the trustee to abandon their home as property of the estate because it had little equity and thus little value for unsecured creditors. A copy of the opinion in Richard Jahn v. Philip Craig Burke is available at: Link to Opinion. Husband and wife debtors filed a petition under chapter 7 of the Bankruptcy Code, listing their home on their schedules as having an appraised value of $108,000 and a mortgage of $91,581. The bankruptcy trustee moved to evict the…
The U.S. Court of Appeals for the Eleventh Circuit recently held the Telephone Consumer Protection Act permits a consumer to partially revoke her consent to be called by means of an automatic telephone dialing system (“ATDS”), and thereby only receive calls at certain times of the day or on certain days. Accordingly, the Eleventh Circuit reversed the trial court order granting summary judgment in favor of the defendant, and ruled that whether the consumer had partially revoked consent was a question of fact for a jury. A copy of the opinion in Schweitzer v. Comenity Bank is available at: Link to…
The Appellate Court of Illinois, Third District, recently rejected a mortgagor’s argument that the Illinois single refiling rule barred a third attempt at foreclosure where the intervening foreclosure complaint was premised upon an alleged default under a loan modification agreement. A copy of the opinion in Wells Fargo Bank, N.A. v. Norris is available at: Link to Opinion. The convoluted procedural and factual history for the mortgage loan at issue in this matter can be boiled down to the following: The defendant mortgagor (who was not a signatory to the promissory note) and his ex-spouse defaulted under the terms of…
The U.S. Court of Appeals for the Fifth Circuit recently held that debts arising from a scheme to deprive mortgagees of surplus foreclosure sale proceeds were non-dischargeable, affirming the bankruptcy court’s judgment against the debtor in consolidated adversary proceedings filed by various lenders that held first mortgage liens. A copy of the opinion in Cowin v. Countrywide Home Loans, Inc. is available at: Link to Opinion. The debtor orchestrated a mortgage fraud scheme by which a straw buyer acquired property subject to a first mortgage at a condominium association’s foreclosure sale. The buyer then entered into a “tax-transfer loan agreement”…
The U.S. Court of Appeals for the Sixth Circuit recently held that a class could not be certified because the defendant’s alleged liability under the federal Telephone Consumer Protection Act (TCPA) for sending a “junk fax” without an opt-out notice required determination of two individualized issues, which rendered class certification impracticable. In so ruling, the Sixth Circuit concluded that with the absence of a fax log to identity each recipient, and without an alternative method of identifying class members who had provided consent to receive the fax, the plaintiff failed to prove that its proposed class satisfied Fed. R. Civ.…
The U.S. Court of Appeal for the Sixth Circuit recently affirmed the dismissal of a municipality’s public nuisance claims against two different mortgage lenders for allegedly maintaining a policy of violating local and state building codes if the costs outweighed the value added to the eventual resale of foreclosed property. A copy of the opinion in City of Cincinnati v. Deutsche Bank National Trust Company is available at: Link to Opinion. The municipality brought multiple claims against the mortgage lender defendants alleging various claims concerning the maintenance and condition of REO properties. Eventually, through multiple amended pleadings, stipulations and settlements, only one…
The U.S. Court of Appeals for the Sixth Circuit recently reversed the dismissal of a class action lawsuit filed by a bank account holder who asserted that the bank violated the Uniform Commercial Code 4-401 and 4-103(a), dealing with liability for fraudulent checks. The account holder experienced check fraud and the bank refused liability because the master services agreement for the account contained a liability waiver for failure to purchase fraud protection products, which the account holder had not done. A copy of the opinion in Majestic Building Maintenance, Inc. v. Huntington Bancshares Inc. is available at: Link to Opinion. The…
The District Court of Appeal of the State of Florida, First District, recently affirmed the trial court’s entry of a final judgment of foreclosure, holding that because the complaint included at least some installment payments within five years of the filing of the complaint, the action was not barred by res judicata or the statute of limitations. A copy of the opinion in Forero v. Green Tree Servicing, LLC is available at: Link to Opinion. Husband and wife borrowers defaulted on their mortgage loan in December 2008. The mortgagee filed a foreclosure action in February 2010, but voluntarily dismissed the case in…
The U.S. Court of Appeals for the Ninth Circuit recently held that mortgage underwriters were not exempt under the federal Fair Labor Standards Act (FLSA) and were therefore entitled to overtime compensation for hours worked in excess of 40 per week. After analyzing the specific details of the underwriters’ responsibilities, the Ninth Circuit panel concluded that, because the underwriters’ primary job duty did not relate to their employer bank’s management or general business operations, the administrative employee exemption to the FLSA’s overtime requirements did not apply. Recognizing that there was a split between the Second Circuit and Sixth Circuit as…
In a deeply divided opinion, the U.S. Court of Appeals for the Seventh Circuit, in an en banc review, reversed its previous opinion, Oliva v. Blatt, Hasenmiller, Leibsker & Moore, LLC, 825 F.3d 788, 791 (7th Cir. 2016), holding this time that a debt collector that relied upon circuit precedent interpreting the federal Fair Debt Collection Practices Act (FDCPA) venue provision was not protected by the bona fide error defense. In so ruling, the Court also held that for purposes of compliance with the FDCPA, reliance on court precedent is permitted, but only if there can be no doubt whatsoever as to the accuracy…