Justia Banking Opinion Summaries

Former employees (Plaintiffs) of a failed bank taken into receivership by the Federal Deposit Insurance Corporation (FDIC) sued Banco Popular de Puerto Rico (BPPR), a bank that subsequently acquired the failed bank's deposits and certain assets on claims for severance pay. The FDIC intervened, asserting that the district court lacked jurisdiction over the claims because Plaintiffs either failed to file administrative claims with the FDIC or failed to challenge in federal court the FDIC's disallowance of their administrative claims. BPPR moved for summary judgment, arguing that it was not liable for any severance claims for at least three different merits-based reasons. The district court granted summary judgment for BPPR and did not address the question of whether it had jurisdiction. The First Circuit Court of Appeals vacated entry of summary judgment for Defendants and remanded with instructions to dismiss for lack of subject-matter jurisdiction, holding that Plaintiffs' failures to comply with the Financial Institutions Reform, Recovery, and Enforcement Act administrative claims process triggered the statutory bar, and Plaintiffs could not avoid the jurisdictional bar by failing to name the FDIC as a defendant. View "Acosta-Ramirez v. Banco Popular de Puerto Rico" on Justia Law

The plaintiffs in this case appealed the grant of summary judgment upholding the validity of a bank's mortgage in real property that the plaintiffs had sold to a mortgagor in exchange for an interest in an investment account that turned out to be a Ponzi scheme. Plaintiffs filed an action against other parties to their transaction including the Bank of Commerce arguing, among other things, that they were entitled to rescind the sale of a portion of their property for lack or failure of consideration and mutual mistake ("They argue[d] that they did not receive any consideration because the . . . interest in their investment account with the Trigon Group turned out to be worthless. Mr. Harris testified that he 'assumed that was real money, which it later proved out not to be.'"). Finding no error in the district court's judgment, the Supreme Court affirmed the lower court. View "Harris v. Bank of Commerce" on Justia Law

In 2008, Harris N.A. loaned Acadia money on a revolving basis. Acadia is a limited liability company consisting of members of the Hershey family and three trusts. The loan was personally guaranteed by Loren Hershey, a managing member of Acadia. The amount of the loan was enlarged to $15.5 million, again guaranteed by Hershey. The agreement enlarging the loan amount required Acadia to reduce its principal debt to Harris to less than 35 percent of the value of Acadia’s assets by the end of each quarter and to make a principal payment of $3 million by January 31, 2009. By February 2009, Acadia had not made the $3 million principal payment and was in default. After granting additional time, Harris declared a default and filed suit to collect the debt from Acadia and to enforce Hershey’s guaranty. The district court granted summary judgment in favor of Harris as to all issues except the calculation of prejudgment interest. Acadia sought bankruptcy protection and its appeal has been stayed. The Seventh Circuit affirmed as to Hershey and, finding the appeal frivolous, imposed sanctions under FRAP 8. The court noted that there was no evidence of various promises Hershey claimed were made. View "Harris N.A. v. Acadia Invs. L.C." on Justia Law

In 2003 the Jacksons obtained a $282,500 home mortgage refinancing loan with a 30-year fixed interest rate of 5.875% from AWL. They used a mortgage broker, MFMS, to apply for the loan. The Jacksons allege that other defendants have been “involved with the mortgage process in various capacities.” The Jacksons went into default in March 2010. Although there was no foreclosure action, the Jacksons initiated an action to quiet title on the property in December 2011. They claimed that defendants negligently evaluated the Jacksons’ ability to repay the loan and that the loan contract was substantively and procedurally unconscionable. The district court dismissed all counts. The Seventh Circuit affirmed. View "Jackson v. Bank of Am. Corp." on Justia Law

This appeal was a companion to another case handed down on this same date, Chase Bank USA, N.A. v. Regions Bank. The appeal involved challenges only to postjudgment matters in the case. Subsequent to Chase Bank filing its notice of appeal of the circuit court's order granting summary judgment against it and posting a supersedeas bond, several parties in the case moved for attorneys' fees against Chase. The circuit court denied the motions. Additionally, one of the parties filed several additional posttrial motions, which Chase opposed. Appellants appealed, making several arguments. The Supreme Court dismissed the appeal, holding that because the Court reversed the order granting summary judgment and judgment on the pleadings against Chase in Chase Bank USA, N.A. the arguments raised in the instant appeal were moot. View "Regions Bank v. Chase Bank USA, N.A." on Justia Law

Wanda Stephens purchased property in Little Rock consisting of Tract A and Tract B. In 2001, Wanda executed a quitclaim deed to the Stephens Family Limited Partnership (SFLP) and mortgaged the property to Regions Mortgage. In 2002, Wanda executed a warranty deed conveying Tract A to herself for life with a remainder to Greg Stephens and his heirs. In 2005, Wanda mortgaged Tract B of the land to Chase Bank. Regions Bank (Region) subsequently made a loan to Wanda, taking as collateral a mortgage on Tract A and Tract B. Wanda defaulted on the first mortgage, and Regions Mortgage foreclosed on both tracts. $308,828 remained from the sale. Chase and Regions asserted claims to the monies, and SFLP and the Stephens heirs intervened. All parties claimed to be first in priority. The circuit court granted partial summary judgment against Chase, finding that the interests of Regions, SFLP, and the Stephens heirs were superior to Chase's. The Supreme Court reversed and remanded, holding that because the question of whether Chase had actual notice of the Stephens heirs' claim on the property was a question of fact, summary judgment was inappropriate. View "Chase Bank USA, N.A. v. Regions Bank" on Justia Law

These appeals, heard in tandem, challenged two separate judgments entered in the district court in favor of TD Bank and Capital One, respectively, dismissing plaintiffs' claims that the banks violated Article 52 of the New York Civil Practice Law and Rules (CPLR), as amended by the Exempt Income Protection Act (EIPA), 2008 N.Y. Laws Ch. 575. Plaintiffs, as judgment debtors, alleged that the banks failed to provide them with certain required notices and forms, restrained their accounts, and assessed them fees, all in violation of the EIPA. Because these appeals presented unresolved questions of law, the court reserved decision and certified the issues to the New York State Court of Appeals. View "Cruz v. TD Bank, N.A." on Justia Law

M&T Real Estate Trust foreclosed on commercial mortgages executed by Defendant. After a public auction, the referee sold M&T the property. M&T's attorney twice declined to accept or retain physical possession of the referee's deed dated May 11, 2010. As a result, the referee took back the deed and other closing documents and ultimately executed a deed on August 9, 2010 when M&T's attorney accepted it on behalf of MAT Properties, Inc. The deed was recorded on August 17, 2010. M&T subsequently filed a motion seeking to confirm the referee's report of sale and enter a deficiency judgment. Defendants argued that M&T's request for a deficiency judgment was untimely. The county court granted M&T's motion, determining that it was timely under the relevant ninety-day period because the consummation of the sale occurred on August 9, 2010 and was recorded on August 17, 2010. The appellate division reversed, concluding that the ninety-day period commenced in May 2010 upon the delivery of the referee's deed. The Court of Appeals reversed, holding that M&T's motion was timely because it was brought within ninety days after the date of the consummation of the sale by the delivery of the deed to the purchaser on August 9, 2010. View "M&T Real Estate Trust v. Doyle" on Justia Law

This case arose out of a challenge by a borrower, Respondent, to the authority of various individuals and entities to effectuate a valid foreclosure on her residential property. After a foreclosure sale was scheduled by the substitute foreclosure trustees, but before the sale took place, Respondent filed a separate action seeking compensatory damages and declaratory and injunctive relief against the substitute trustees, Deutsche Bank, and BAC Home Loans Servicing for alleged defects in the foreclosure process and the authority of Defendants to foreclose on her property. Deutsche Bank and BAC (Petitioners) filed a motion for summary judgment on Respondent's action, which the circuit court granted. The court of special appeals reversed, finding that Petitioners did not prove they were persons entitled to enforce the promissory note, and thus genuine issues of material fact precluded summary judgment. The Court of Appeals reversed, holding that BAC was entitled to enforce the note. Remanded. View "Deutsche Bank Nat'l Trust Co. v. Brock" on Justia Law

Meritor Bank failed in 1992 after the Federal Deposit Insurance Corporation (FDIC) breached a capital agreement with Meritor. The Federal Circuit affirmed that the government was liable for breach of contract, and awarding $276 million in “lost value” damages. On remand, the Claims Court applied 12 U.S.C. 1821(d)(11), the statute governing the distribution of a receivership surplus by the FDIC acting in its capacity as a receiver, and held that current Meritor shareholders are the proper recipients of the $276 million award. The court also denied a motion to intervene filed by McCarron, a former Meritor employee, on the grounds of lack of subject matter jurisdiction and issue and claim preclusion. Intervenors, former shareholders who owned shares of Meritor at the time of its failure but later sold their shares, appealed from an order directing the FDIC-Receiver to distribute the receivership surplus to current shareholders. McCarron appealed denial of his motion to intervene. The Federal Circuit affirmed. View "Slattery v. United States" on Justia Law