Justia Banking Opinion Summaries

Plaintiff sued Defendants for fraud and deceptive trade practices in connection with a real estate purchase and loan arrangement. The jury found in favor of Plaintiff and awarded him compensatory damages consisting of actual damages and emotional distress damages, as well as punitive damages. The Supreme Court reversed the judgment as to consequential damages and remanded for a redetermination of punitive damages. On remand, the district court instructed the jury that it was to decide “what amount, if any, [Plaintiff] was entitled to for punitive damages.” After punitive damages were awarded, Defendants appealed. The Supreme Court reversed the district court’s punitive damages award and remanded for a new trial, holding (1) Nev. Rev. Stat. 42.005(3) requires a second jury on remand to reassess whether punitive damages are warranted before that jury may determine the amount of punitive damages to be awarded; and (2) because the jury instruction did not require the jury to make the threshold determination of whether punitive damages could be awarded, the case must be remanded for a new trial on punitive damages. View "D.R. Horton, Inc. v. Betsinger" on Justia Law

Plaintiff filed a quiet title complaint against Guild and others, alleging that the loans secured by the real property at issue were securitized, resulting in defendants' interest in the real property being extinguished, relinquished or discharged. On appeal, plaintiff argued that he can state a valid cause of action for quiet title based on allegations that the attempt to transfer the first deed of trust to the mortgage-backed "investment" trust (CWALT) did not comply with the trust's servicing and pooling agreement and was therefore void. The court concluded that plaintiff's argument was addressed in Jenkins v. JPMorgan Chase Bank, N.A., and the court agreed with Jenkins that, in this case, such allegations do not give rise to a viable preemptive action that overrides California's nonjudicial foreclosure rules. Accordingly, the court affirmed the judgment and concluded that Guild's demurrer was properly sustained. View "Kan v. Guild Mortgage" on Justia Law

Bank of America, N.A. filed a complaint in foreclosure against George and Bridget Kuchta, claiming to be the holder of a promissory note and assignee of the mortgage. The trial court granted summary judgment to the bank and entered a decree of foreclosure in its favor. The Kuchtas moved to vacate the summary judgment and decree of foreclosure, arguing that the bank lacked standing to commence the action because it did not prove ownership of the note and because the mortgage assignment was fatally flawed. The trial court denied the motion. The court of appeals reversed, holding that standing is a jurisdictional matter and that Bank of America’s alleged lack of standing would warrant relief from judgment. The Supreme Court reversed, holding that a lack of standing cannot support a motion for relief from judgment, and lack of standing does not render a judgment void for lack of subject matter jurisdiction. View "Bank of Am., N.A. v. Kuchta" on Justia Law

In 2004, Charles Adams conveyed a portion of his parcel of property to himself and his sister, Dorothy Adams, as joint tenants. Dorothy subsequently executed a promissory note to American Bankers Conduit and conveyed a mortgage on her interest in the property as security on the note. Dorothy defaulted on the loan in 2008. In 2012, U.S. Bank sought to place an equitable lien on Charles’s interest in the property. After a trial, the superior court entered a judgment on the merits in favor of Charles. The Supreme Court vacated the judgment and remanded for entry of dismissal, holding that because the complaint was not timely filed the action should have been dismissed pursuant to 14 Me. Rev. Stat. 752. Remanded. View "U.S. Bank Nat’l Ass’n as Trustee v. Adams" on Justia Law

Respondent obtained a home mortgage loan from Lender. Lender obtained a mortgage lender bond from Petitioner and later filed for bankruptcy under Chapter 11 of the United States Code. Respondent subsequently filed a complaint naming Petitioner as defendant solely as surety for Lender. At the time this suit was filed, Lender was bankrupt and judgment proof. Petitioner filed a motion to dismiss, arguing that the bond conditions had not been satisfied because Respondent had not obtained a judgment against the bond principal, Lender. The circuit court certified a question of law to the Supreme Court, which answered that the bond at issue was a judgment bond and that the unambiguous bond language requires an aggrieved party to obtain a judgment against the principal before maintaining an action against the surety of the bond. View "Fidelity & Deposit Co. of Md. v. James" on Justia Law

Thomas and Chapman were part of a scheme to fleece real estate lenders by concocting multiple false sales of the same homes and using the loan proceeds from the later transactions to pay off the earlier lenders. They were convicted of multiple counts of wire fraud. Thomas was also convicted of aggravated identity theft for using an investor’s identity without permission to craft a phony sale of a home that the victim never owned. The Seventh Circuit affirmed, rejecting: challenges to the sufficiency of the evidence; a claim by Thomas that there was no proof that he created or used the falsified documents at issue; Chapman’s claim that there was no evidence that he was the Lamar Chapman identified by the evidence, because no courtroom witness testified to that effect; Chapman’s claim that his due process rights were violated when the government dropped a co-defendant from the indictment; and a claim that the government failed to turn over unspecified exculpatory evidence. The court noted testimony from several victims, an FBI investigator, an auditor, and an indicted co-defendant who had already pleaded guilty. View "United States v. Chapman" on Justia Law

Plaintiffs filed suit against Chase and WaMu, alleging claims arising out of allegedly fraudulent acts by WaMu concerning the refinancing of their mortgage. WaMu was later placed into receivership of the FDIC and the FDIC transferred plaintiffs' mortgage to Chase. The court concluded that plaintiffs' claims in their complaint are "claims" for purposes of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA), 12 U.S.C. 1821(d)(3)(D), and related to WaMu's acts or omissions for purposes of section 1821(d)(13)(D). Because plaintiffs have not exhausted their administrative remedies under section 1821(d), the plain language of section 1821(d)(13)(D)(ii) stripped the district court of jurisdiction to consider plaintiffs' complaint. Accordingly, the court affirmed the district court's dismissal of plaintiffs' claims.View "Rundgren v. Washington Mutual" on Justia Law

Attorney Valeriano Diviacchi represented Camilla Warrender in an action brought against Warrender by her mortgagee, Sovereign Bank, which sought to collect on a loan secured by certain real property. Shortly after Diviacchi entered his appearance, Warrender, without Diviacchi’s assistance, agreed to a settlement pursuant to a stipulation that Warrender’s property be sold to a third party. Diviacchi filed a notice of attorney’s lien pursuant to Mass. Gen. Laws ch. 221, 50 (section 50). The property was subsequently sold to a third-party, and Sovereign Bank dismissed its claims against Warrender. The district court denied the motion to enforce the attorney’s lien, concluding that the lien was not enforceable under section 50 because Diviacchi “failed to make a showing that he incurred reasonable fees and expenses….” The First Circuit affirmed, holding that Diviacchi’s lien was not legally enforceable against the sale proceeds.View "Sovereign Bank v. Diviacchi" on Justia Law

Plaintiff alleged that he was the victim of a fraudulent scheme in which he allowed an attorney to take title to his home and strip it of its equity by granting a new mortgage. Plaintiff filed suit against the mortgagee in an effort to avoid foreclosure. A federal district court granted Defendants’ motion to dismiss for failure to state a claim that the mortgage was void. The district court denied Plaintiff’s subsequent motion to amend his complaint. The First Circuit affirmed the dismissal of Plaintiff’s complaint and the denial of his motion for leave to amend, holding (1) Plaintiff’s complaint provided no legal basis for making the bank liable for the attorney’s wrongdoing; and (2) Plaintiff failed adequately to plead facts supporting his proposed amendments to his complaint, and therefore, his new claims were also futile.View "Giuffre v. Deutsche Bank Nat’l Trust Co." on Justia Law

Plaintiffs filed suit against Countrywide and others involved in their residential mortgage, alleging violations of numerous federal statutes. The district court dismissed the claims with prejudice and plaintiffs appealed. The court held that plaintiffs can state a claim for rescission under the Truth in Lending Act (TILA), 15 U.S.C. 1601 et seq., without pleading that they have tendered, or that they have the ability to tender, the value of their loan; only at the summary judgment stage may a court order the statutory sequence altered and require tender before rescission - and then only on a case-by-case basis; and, therefore, the court reversed the district court's dismissal of plaintiffs' rescission claim and remanded for further proceedings. The court held that, although the limitations period in the Real Estate Settlement Practices Act (RESPA), 12 U.S.C. 2614, ordinarily runs from the date of the alleged RESPA violation, the doctrine of equitable tolling may, in the appropriate circumstances, suspend the limitations period until the borrower discovers or had reasonable opportunity to discover the violation; just as for TILA claims, district courts may evaluate RESPA claims case-by-case; and, therefore, in this case, the court vacated the dismissal of plaintiffs' Section 8 of RESPA claims on limitations grounds and remanded for reconsideration. View "Merritt v. Countrywide Financial Corp." on Justia Law