Justia Banking Opinion Summaries

Plaintiff sought to rescind a loan she entered into with the trustee of a mortgage investment trust, and the district court granted rescission, finding that the mortgaged property was plaintiff's "principal dwelling" and the trustee failed to give plaintiff adequate notice of her right to rescind. In this case, the trustee failed to comply with two requirements of the Truth in Lending Act, 15 U.S.C. 1635, and a related regulation where he instructed plaintiff to sign simultaneously the loan documents and a postdated waiver of her right to rescind the transaction and the trustee failed to give plaintiff two copies of the notice of her right to rescind. The court concluded that the record fairly supports the district court's findings of fact; plaintiff was entitled to rescission because the trustee failed to give plaintiff clear and conspicuous notice of her right to rescind; but the district court lacked the discretion to deny plaintiff statutory damages, attorney's fees, and costs. Accordingly, the court affirmed in part, reversed in part, and remanded for a determination of the amounts owed. View "Harris v. Schonbrun" on Justia Law

The Avakians purchased a house with a loan secured by a properly executed deed of trust. The property was their homestead, where they lived together. Citibank refinanced the loan. Unlike the original loan, the refinancing note only listed Norair as the debtor. Citibank required that the Avakians execute another deed of trust. Norair signed the Citibank deed of trust. The next day, Burnette signed an identical deed of trust. The deeds of trust did not mention each other, and did not refer to signature of counterpart documents. Citibank recorded them as separate instruments. The Avakians received a loan modification. Around the time of Norair’s death, Burnette received notice that Citibank was taking steps to foreclose. After Norair’s death, Burnette sought a declaratory judgment. The district court granted summary judgment to Burnette, finding that, because the two were living together when they signed the Citibank deeds of trust, the instruments were invalid. The Fifth Circuit reversed. Under Mississippi law, a deed of trust on a homestead is void if it is not signed by both spouses, but the Mississippi Supreme Court would likely hold that a valid deed of trust is created when husband and wife contemporaneously sign separate, identical instruments. View "Avakian v. Citibank, N.A." on Justia Law

In the 1950s and ’60s, to encourage private developers to construct, own, and manage housing projects for low- and moderate-income families, the government insured mortgages on those projects in exchange for provisions, such as a 40-year mortgage term, an agreement to maintain affordability restrictions for the duration of the mortgage, and prepayment limitations or prohibitions. The Emergency Low Income Housing Preservation Act of 1987 and the Low-Income Housing Preservation and Resident Homeownership Act of 1990 instituted a process to request the right to prepay mortgages. There were substantive restrictions on HUD granting prepayment requests, limiting its discretion, 12 U.S.C. 4108(a)). Prepayment is one step toward renting at market prices. The Acts permit HUD to grant incentives rather than permission to prepay. Owners claimed that the Acts constituted an as-applied taking. The Claims Court granted the government’s motions: for summary judgment that the takings claims for some properties were unripe for failure to exhaust administrative remedies; for summary judgment that no taking occurred for properties for which mortgages did not include a prepayment right; and for summary judgment of collateral estoppel as to one owner. The Federal Circuit affirmed as to ripeness and prepayment, but reversed as to collateral estoppel. View "Biafora v. United States" on Justia Law

After losing his property in a state foreclosure action, plaintiff filed suit against Accredited and Deutsche Bank for fraud, negligent misrepresentation, unjust enrichment, violations of the Truth in Lending Act (TILA), 15 U.S.C. 1601 et seq., violations of the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. 2601 et seq., violations of Connecticut's truth in lending law, and violations of the Connecticut Unfair Trade Practices Act (CUTPA), Conn. Gen. Stat. 42-110a et seq., as well as perjury, forgery, and predatory lending. The court concluded that the district court lacks jurisdiction over certain of plaintiff's fraud claims under the Rooker-Feldman doctrine; however, after determining that it lacked jurisdiction, the district court should have remanded the barred claims to state court instead of dismissing them on the merits; and, therefore, the court vacated the judgment as to those claims so they may be remanded to the state court. To the extent that petitioner asserted fraud claims that are not barred by Rooker-Feldman, the court affirmed the district court's dismissal of the claims as untimely and barred by collateral estoppel because plaintiff has not challenged those rulings on appeal. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "Vossbrinck v. Deutsche Bank National Trust Co." on Justia Law

In 2006, Thompson signed a $354,800 mortgage note with AME as the lender. Several sections of the note and deed of trust noted AME’s intent to transfer the note. Its signature page contains a signed, undated stamp memorializing AME’s transfer to Countrywide and another signed, undated endorsement from Countrywide to blank. BOA purchased Countrywide and has the note. In 2012, BOA offered to short-sell her house in lieu of foreclosure. Thompson requested modification of her repayment terms under the HAMP program (Emergency Economic Stabilization Act, 12 U.S.C. 5201), that gives lenders incentives to offer modifications to borrowers with a payment-to-income ratio over 31%. Thompson claims that she complied with numerous document requests. BOA never granted her application. She sued BOA, Mortgage Electronic Registration Systems, and unidentified persons she believes to be the note’s true owners, claiming: that BOA falsely induced her to sign the mortgage by pretending it was an actual lender; that her title is clouded by the note’s transfer; and that BOA fraudulently induced her to seek modification, knowing it lacked authority to modify her terms or intending to drive her into foreclosure. The district court dismissed for failure to comply with pleading standards. The Sixth Circuit affirmed. View "Thompson v. Bank of Am., N.A." on Justia Law

McIvor claims that she used TransUnion's online system to dispute a $242 debt alleged against her by Credit Control. She reported, "Creditor agreed to remove this account from my file. This account is settled." TransUnion reported McIvor's dispute to Credit Control as required by the Fair Credit Reporting Act, 15 U.S.C. 1681. McIvor alleged that Credit Control then "provided updated credit information regarding the Debt to [TransUnion] on April 20, 2013 without stating that [she] had disputed it," and TransUnion "in turn verified the Debt to [McIvor] on April 21, 2013." McIvor attached exhibits to the complaint showing screenshots of the investigation request, her updated credit file, and the resolution summary TransUnion provided. She alleged violation of 15 U.S.C. 1692e(8) by “false, deceptive, or misleading representation or means in connection with the collection of any debt.” The Eighth Circuit affirmed dismissal. McIvor neither plausibly alleged that the communication at issue was "false, deceptive, or misleading" nor that it was "in connection with the collection of any debt." View "McIvor v. Credit Control Servs, Inc." on Justia Law

AIDG Properties, LLC, a real-estate holding company managed by Anjan Dutta-Gupta, purchased property. AIDG obtained loans from BankNewport (Defendant) to finance the purchase and to perform improvements. Dutta-Gupta personally guaranteed the loans. Emond Plumbing & Heating, Inc. and Tecta America New England, LLC (collectively, Plaintiffs) served as subcontractors on the project. Plaintiffs substantially completed the renovations, and BankNewport deposited the loan proceeds into AIDG’s account. After Dutta-Gupta was arrested, Defendant declared Dutta-Gupta to be in default and accelerated the loans. Defendant then set off the deposit it made previously by reversing it. As a result, AIDG was unable to pay Plaintiffs for the work they had performed. Defendant, who was granted possession of the property, later foreclosed. Plaintiffs filed a complaint seeking to recover compensation for their work under the theory of unjust enrichment. The superior court granted summary judgment for Defendant. The Supreme Court affirmed, holding that due to the absence of a relationship between Plaintiffs and Defendant and the lack of any allegation that Defendant engaged in any type of misconduct or fraud, Defendant’s retention of the property, including the improvements, was not inequitable under the Court’s jurisprudence on unjust enrichment. View "Emond Plumbing & Heating, Inc. v. BankNewport" on Justia Law

Tender Care Veterinary Hospital, Inc. ("TCVH"), appealed the grant of summary judgment entered in favor of First Tuskegee Bank on breach-of-fiduciary-duty and fraud claims stemming from a construction loan TCVH received from First Tuskegee in September 2004. The gravamen of those claims was that TCVH was injured by First Tuskegee's alleged insistence that TCVH use PJ Construction as the general contractor on the project although PJ Construction was not licensed as a general contractor in Alabama, that PJ Construction's work product was below what one would expect from a properly licensed general contractor, and that using PJ Construction resulted in delays, cost overruns, and, TCVH argued, the ultimate failure of its business. However, because TCVH's claims accrued in approximately July 2005 and TCVH did not formally assert them until after it initiated this action in April 2009, those claims were barred by the two-year statute of limitations that governed them. Accordingly, the summary judgment entered by the trial court in favor of First Tuskegee was affirmed. View "Tender Care Veterinary Hospital, Inc. v. First Tuskegee Bank " on Justia Law

In 2004, Paint Rock Turn, LLC purchased a sod farm and related farm equipment. To partially finance the purchase, Paint Rock borrowed $1,706,250 from First Jackson Bank. The loan was secured by a mortgage on the sod farm and a security interest in the equipment used on the farm. By February 2009, reflecting in part a drop in demand for sod caused by the collapsing market for new homes, Paint Rock had defaulted on the loan. In early 2009, Paint Rock filed a Chapter 11 bankruptcy petition. The filing of the petition operated as an automatic stay and precluded First Jackson from foreclosing on the sod farm or retaking the equipment. The bankruptcy petition was dismissed later that year, and a few months later, First Jackson moved forward with its intent to foreclose by publishing the first of three notices of a foreclosure sale on the Paint Rock property. On the morning of the scheduled sale, Paint Rock filed a second bankruptcy petition, which stayed the sale. This second petition was dismissed a month later for failure to file the proper schedules and statements. First Jackson published another notice that the foreclosure sale was rescheduled for December 30, 2009. December 26, Paint Rock filed a third bankruptcy petition. Four days later, the bankruptcy court lifted the automatic stay, expressly finding that Paint Rock misused the bankruptcy process to "hinder and delay First Jackson's efforts to foreclose its mortgage and security agreement." First Jackson was the high bidder at the sale, purchased the property, and sent Paint Rock a letter demanding possession of the sod farm. In early 2010, First Jackson filed an ejectment action. The same day, Paint Rock demanded access to the farm to recover "emblements in the form of sod which is being grown on the real property recently foreclosed upon ...." Paint Rock also requested the return of its equipment. First Jackson denied Paint Rock's request. Paint Rock, relying on a section of the Alabama Code that permits a tenant at will to harvest its crop, counterclaimed for damages for harm suffered as the result of being unable to harvest the sod. Paint Rock also sought damages for conversion of "plats of sod" contained on the sod farm. First Jackson sold the sod farm to Mrs. Goodson, subject to any claim Paint Rock may have to the emblements growing on the property. Paint Rock filed a joint third-party complaint against First Jackson and Mr. and Mrs. Goodson, alleging conversion and detinue, as well as the emblements claim. After the trial court denied motions for a summary judgment filed by First Jackson and the Goodsons, the case proceeded to trial. At the close of Paint Rock and Jones's case, the trial court granted a motion for a JML filed by First Jackson and the Goodsons on Paint Rock's counterclaim for emblements on the ground that Paint Rock was not an at-will tenant. After Paint Rock withdrew its detinue claims and the trial court granted a JML on the wantonness claims, leaving only the conversion and negligence claims. The jury awarded Paint Rock damages against First Jackson for conversion of a sod cutter and cut sod that had been loaded on a tractor-trailer when First Jackson took possession of the property. The jury also awarded Paint Rock damages against the Goodsons for conversion of business property and equipment. Paint Rock appealed the JML in favor of the defendants on the emblements claim; First Jackson cross-appealed the judgment awarding Paint Rock damages for conversion of the cut sod. The Supreme Court affirmed with regard to Paint Rock's emblements claim, but reversed on the conversion of the cut sod claim. View "Paint Rock Turf, LLC v. First Jackson Bank et al. " on Justia Law

Plaintiff and his wife purchased a home in Massachusetts that was encumbered by a mortgage. The mortgage was eventually assigned to Defendant CitiMortgage, Inc. Defendant ultimately invoked its statutory power of sale and sent a notice of foreclosure sale to Plaintiff’s home address. Plaintiff sued, alleging breach of contract, unjust enrichment, and breach of the covenant of good faith and fair dealing. A federal district court granted summary judgment for Defendant on all counts and denied Plaintiff’s motion for reconsideration. The First Circuit affirmed the district court’s denial of Plaintiff’s motion for reconsideration, holding that none of the grounds advanced by Plaintiff for reversal of the district court’s denial of reconsideration warranted relief. View "Biltcliffe v. CitiMortgage, Inc." on Justia Law