Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Garcia v. JP Morgan Chase Bank N.A.

United States District Court, D. Arizona

April 5, 2017

Patricia Garcia, Plaintiff,
JP Morgan Chase Bank NA, et al., Defendants.


          Douglas L. Rayes United States District Judge.

         This case involves allegations that Defendants Bank of America NA (BANA) and JPMorgan Chase NA (Chase) broke promises, acted negligently, committed fraud, and otherwise violated the law while evaluating Plaintiff Patricia Garcia for a home loan modification. Defendants' predecessor in interest loaned Garcia $830, 000 with which to purchase a home and, in exchange, Garcia promised to repay the money with interest in monthly installments. Garcia later fell upon hard financial times and could not keep up with her monthly payments. Additionally, her home suffered flood damage. Garcia sought and eventually was offered a loan modification to make her monthly payments more manageable. She did not accept it, though, because she could not misrepresent the condition of her home, she was unsatisfied that the offer did not forgive a portion of the loan's principal to reflect her home's current value, or some combination of the two. After Garcia became ill, and at her attorney's request, Defendants agreed to cease default-related communications. Garcia, however, remained in default for several more months, triggering foreclosure.[1]

         At issue is Defendants' Motion for Summary Judgment. (Doc. 203.) The motion is fully briefed and the Court heard oral argument on February 3, 2017. For the following reasons, the Court grants Defendants' motion.


         Summary judgment is appropriate when there is no genuine dispute as to any material fact and, viewing those facts in a light most favorable to the nonmoving party, the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). Summary judgment may also be entered “against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). The party seeking summary judgment “bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of [the record] which it believes demonstrate the absence of a genuine issue of material fact.” Id. at 323. The burden then shifts to the non-movant to establish the existence of a genuine and material factual dispute. Id. at 324. The non-movant “must do more than simply show that there is some metaphysical doubt as to the material facts, ” and instead “come forward with specific facts showing that there is a genuine issue for trial.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986) (internal quotation and citation omitted).

         Substantive law determines which facts are material and “[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “A fact issue is genuine ‘if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.'” Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002) (quoting Anderson, 477 U.S. at 248). Conclusory allegations, unsupported by factual material, are insufficient to defeat summary judgment. Taylor v. List, 880 F.2d 1040, 1045 (9th Cir. 1989). If the nonmoving party's opposition fails to cite specifically to evidentiary materials, the court is not required to either search the entire record for evidence establishing a genuine issue of material fact or obtain the missing materials. See Carmen v. S.F. Unified Sch. Dist., 237 F.3d 1026, 1028-29 (9th Cir. 2001); Forsberg v. Pac. N.W. Bell Tel. Co., 840 F.2d 1409, 1417-18 (9th Cir. 1988).


         On December 13, 2006, Garcia executed a promissory note (Note) in the principal amount of $830, 000 in favor of Washington Mutual Bank, F.A. (WaMu) and used the money to purchase residential property in Scottsdale, Arizona. (Doc. 196 ¶ 1; Doc. 1-1 at 20 ¶ 11.) Garcia also executed a deed of trust in favor of WaMu, which secured the Note using the property as collateral. (Doc. 124-2 at 6-10.) BANA purchased the Note from WaMu in 2007, and at all relevant times BANA possessed the Note through Chase, which services the loan on BANA's behalf.[2] (Doc. 196 ¶ 2; Doc. 203 at 2; Doc. 1-1 at 20, 31 ¶¶ 11, 13, 110-11.)

         Garcia paid on her loan through July 2012, but missed payments in August and September of that year.[3] (Doc. 196 ¶ 6.) In early October 2012, she applied to Chase for a loan modification, requesting a principal reduction “with impounds included as the value on my home has substantially decreased.” (¶ 12; Doc. 203 at 3; Doc. 1-1 at 22 ¶ 27.) Defendants denied Garcia's application because her debt-to-income ratio was too high.[4] (Doc. 196 ¶ 13.) Garcia submitted additional applications over the next two years, which also were denied. (Doc. 203 at 4; Doc. 1-1 at 22, 24-25 ¶¶ 30, 34, 44, 58-59.) After April 2014, Garcia stopped making payments entirely because “she simply had run out of funds to pay her mortgage[.]” (Doc. 196 ¶ 7.)

         On November 17, 2014, Chase notified Garcia that she had been approved for a Trial Payment Plan (TPP) under the Chase Home Affordable Modification Program. (Doc. 203 at 4; Doc. 1-1 at 88.) The purpose of the TPP is to demonstrate that the borrower can make consecutive payments. (Doc. 196, ¶ 15.) Here, the TPP required Garcia to make three consecutive monthly payments of $3, 310.33 in January, February, and March 2015. (Doc. 1-1 at 88.)

         Earlier that month, however, Garcia's home suffered flood damage due to a faulty plumbing fixture. (Doc. 203 at 4; Doc. 1-1 at 27 ¶ 73.) On December 17, 2014, Garcia's attorney, Daniel Cracchiolo, sent a letter to Defendants stating that if they truly were interested in avoiding foreclosure, they would need to offer Garcia a loan “which more appropriately reflects the home's value at the present time[.]” (Doc. 203 at 4; Doc. 1-1 at 98-99.) Cracchiolo also stated that the proposed modification's $888, 123.80 principal balance “is so far removed from reality and from the appraisal as to make the modification at that amount an impossibility to perform.” (Doc. 203 at 4; Doc. 1-1 at 99.)

         It appears that Garcia nevertheless moved forward with the TPP. Garcia made the first TPP payment on January 1, 2015, and the following day Chase employee Toby Moore told Garcia that she could advance to a permanent loan modification without making the final two TPP payments. (Doc. 203 at 4; Doc. 1-1 at 28 ¶¶ 81-82; Id. at 105.) On February 18, 2015, Moore informed Garcia that she had been approved for a permanent loan modification and reviewed its terms with her. Garcia, however, was concerned that the offer did not help with the principal balance.[5] (Doc. 196 ¶¶ 17-18.) She also was concerned that the modification agreement required her to represent that her home was “neither in a state of disrepair, nor condemned” (the Property Condition Clause). (Doc. 203 at 5; Doc. 1-1 at 111.) On February 22, 2015, Garcia notified Chase in writing that she could not sign the proposed modification because she could not make such a representation in light of the flood damage. (Doc. 203 at 5; Doc. 1-1 at 118-119.) Her letter also registered concerns over the property's depreciation. (Id.)

         Moore responded to Garcia via email, writing: “Please call me today so we can discuss your intention with the final modification as the docs are due. We are not able to move forward with booking till they are signed by you.” (Doc. 203 at 4; Doc. 1-1 at 124.) After reading Moore's email, Garcia became physically ill, had a panic attack, and was admitted to the hospital.[6] (Doc. 196 ¶ 33; Doc. 203 at 5; Doc. 1-1 at 29 ¶ 91.)

         On February 27, 2015, Cracchiolo communicated to Moore that Garcia had been hospitalized. (Doc. 203 at 5; Doc. 1-1 at 127.) Moore told Cracchiolo that he would place a “cease and desist” in Garcia's file. (Doc. 203 at 5; Doc. 1-1 at 127.) Moore testified that he told Cracchiolo the cease and desist “would stop phone calls [from Chase] until things calmed down a bit” for Garcia.[7] (Doc. 196 ¶ 19.) On March 3, 2015, Moore told Cracchiolo's assistant that Chase needed written consent from Garcia to implement the cease and desist. (¶ 21.) Cracchiolo then sent a letter to Chase stating: “Pursuant to your conversation today with my assistant . . . I am requesting a CEASE AND DESIST order on the above loan until further notice. All contact for Garcia should be through my office as attorney of record.” (¶ 23.) In response, Chase sent Garcia a letter on March 4, 2015, stating in relevant part:

We'll stop default related communications with you and remove the following telephonic number(s) from our call list, as you requested on 03/03/2015. However we'll continue communication that is required by law.
If you would like to resume default-related communication, you must complete the enclosed Borrower Authorization Cease and Desist Removal Form.
Also, if you contact us regarding mortgage assistance for your account, we'll consider your request for assistance to be a waiver of this cease and desist, so8 that we can respond to your request and discuss your options.[8]

         (¶ 24.)

         According to Moore, at that point Garcia's remaining option was to reapply for a modification once her house was fixed because “the doc[uments] had expired and [Defendants] weren't able to get further information [in] regards to the condition of the property[.]” (Doc. 234-1 at 16.) Garcia, however, did not make any payments on her loan after this latest unsuccessful modification effort, nor did she complete the repairs on her home or reapply for a modification. (See Doc. 196 ¶ 7; Doc. 261 at 44.) Consequently, David Cowles, acting as trustee under the deed of trust securing the Note, recorded a Notice of Trustee's Sale on May 6, 2015. (Doc. 1-1 at 134.) The notice indicated that the property would be sold at auction on August 5, 2015 to satisfy the balanced owed on the Note. (Id.)

         On July 1, 2015, Garcia filed a verified complaint against Defendants in Maricopa County Superior Court, alleging eight claims related to her modification efforts and Defendants' foreclosure-related activities: (1) promissory estoppel, (2) breach of the covenant of good faith, (3) fraud, (4) negligence, (5) negligent performance of an undertaking, (6) violation of the Arizona Consumer Fraud Act (ACFA), (7) violation of the Real Estate Settlement Procedures Act (RESPA), and (8) negligence per se. (Doc. 1-1 at 18-44.) Defendants removed the matter to this Court and the parties proceeded with at times contentious discovery. (Doc. 1; see Docs. 46, 77, 192.) Defendants now seek summary judgement in their favor on all of Garcia's claims. (Doc. 203.)


         The facts material to this case are not genuinely disputed.[9] The same cannot be said about the nature of Garcia's claims. Defendants methodically address each of the eight counts alleged in Garcia's verified complaint. Garcia's response, however, fails to grapple with Defendants' arguments and authorities or with the elements of her own claims. For example, Garcia does not mention the ACFA or RESPA in her response, despite alleging claims under these statutes. Instead, she contends that:

the single ‘dispositive issue' mandating denial of the pending motion may be stated by posing, and then answering, two questions, to wit:
1. Under the particular facts of this case, did Defendants (or either of them) have a ‘duty to be fair' to Garcia, in whatever sense the law or equity may require ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.