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Yap v. Deutsche Bank National Trust Co.

United States District Court, D. Arizona

August 28, 2018

Hock Huat Yap, Plaintiff,
Deutsche Bank National Trust Company, et al., Defendants.



         Pending before the Court are the Parties' Cross Motions for Summary Judgment[1](Doc. 44, 51). On August 7, 2018, Plaintiff filed a Motion Requesting a Decision on his Motion for Summary Judgment (Doc. 55).[2] Defendants filed a Motion to Strike (Doc. 56). The Court will deny Plaintiff's Motion for Summary Judgment (Doc. 51), grant Defendants' Motion for Summary Judgment (Doc. 44), and grant Defendants' Motion to Strike (Doc. 56).

         I. Background

         Plaintiff's Second Amended Complaint (“SAC”) (Doc. 8), filed pro se, alleges that one or more of the Defendants claim to possess an interest in a Note executed by Plaintiff on January 5, 2007, naming Option One Mortgage as beneficiary. (Doc. 8 at 2-3.) Plaintiff received notice of Arizona Trustee's Sale No. 124965 on March 6, 2017-an action brought as a means of enforcing the Note that was secured by Plaintiff's property. (Id. at 2.) Plaintiff claims that Defendants have not presented Plaintiff with a “Chain of Title” and therefore do not have “authority & standing to enforce a contract[.]” (Id. at 3.) The SAC alleged violations of the Real Estate Settlement Procedures Act (“RESPA”) and the Truth in Lending Act, in addition to a “chain of title” claim. (Doc. 8.)

         The Court granted Defendants Christina Harper and The Mortgage Law Firm, PC's Motion to Dismiss (Doc. 15), and granted in part and denied in part Defendants Deutsche Bank National Trust Company and Specialized Loan Servicing, LLC's Motion to Dismiss (Doc. 16). (Doc. 36.) Following resolution of the motions to dismiss, only the RESPA claim based on 12 U.S.C. § 2605(k)(1)(D) against Deutsche and SLS remained. (See id.)

         II. Facts

         In January 2007 Plaintiff executed a $346, 500.00 Note and Deed of Trust (“Deed”) on a residential property located at 6480 N. Mona Lisa Road, Tucson, Arizona (“the Property”). (Doc. 45 at 9, 14.) The Deed named Option One Mortgage Corporation (“Option One”) as beneficiary and First American Title Insurance Company (“First American”) as trustee. (Id. at 14.) In 2010, Sand Canyon Corporation, formerly Option One, assigned the Deed to Deutsche Bank National Trust Company (“Deutsche”) as trustee for J.P. Morgan Mortgage Acquisition Trust 2007-HE1, Asset Back Pass-Through Certificates Series 207-HE1 (“JP Morgan Trust”). (Id. at 22.) Plaintiff was notified on July 17, 2015 that his loan servicing was being transferred (“Servicing Transfer Letter”) from JP Morgan Chase Bank, N.A. (“Chase”) to Specialized Loan Servicing, LLC (“SLS”). (Doc. 45 at 24.) The Servicing Transfer Letter included SLS's contact information, including an address and customer service telephone number. (Id. at 25.)

         Following receipt of the Servicing Transfer Letter, Plaintiff began sending Chase requests regarding ownership of his loan and contact information. (See Doc. 45 at 30-39.) Chase informed Plaintiff by letter on August 3, 2015 that the mortgage loan owner for the Property is Deutsche as trustee for JP Morgan Trust, and provided him with a mailing address and phone number for Deutsche. (Id. at 30.) By a separate letter dated August 3, 2015, Chase informed Plaintiff that, after review of his loan, Chase “maintain[s] that [Plaintiff has] undertaken a valid, binding, and legally enforceable obligation with [Chase].” (Id. at 34.) That letter also informs Plaintiff that the loan originated with Option One on January 5, 2007 and that servicing for the loan was transferred to Chase on May 1, 2007. (Id.)

         In response to the August 3rd letter, Plaintiff again wrote to Chase. (Doc. 45 at 32.) In a letter dated August 12, 2015 and titled “Hock-Huat Yap, Alleged Chase Account # 0024386195” Plaintiff asserted that Chase had “neither Beneficiary Interest nor Standing to enforce any alleged obligation.” (Id.) He additionally explained that Chase failed to provide him with requested information[3] and asserted violations of the Fair Debt Collection Practices Act (“FDCPA”). (Id. at 32-33.) Plaintiff concluded the letter by indicating that he planned to seek legal advice on how to proceed in this matter. (Id. at 33.) Plaintiff re-sent Chase essentially the same[4] letter in September 2015. (Id. at 37.) A Notice of Trustee's Sale was recorded on March 2, 2017. (Doc. 45 at 41.)

         III. RESPA - 12 U.S.C. § 2605(k)(1)(D)

         Section (k)(1)(D) of Title 12 of the United States Code-one of the Dodd-Frank additions to the Real Estate Settlement Procedures Act (“RESPA”)-prohibits federally related mortgage servicers from “fail[ing] to respond within 10 business days to a request from a borrower to provide the identity, address, and other relevant contact information about the owner or assignee of the loan[.]” 12 U.S.C. § 2605(k)(1)(D). “RESPA's provisions relating to loan servicing procedures should be construed liberally to serve the statute's remedial purpose.” Medrano v. Flagstar Bank, FSB, 704 F.3d 661, 665-66 (9th Cir. 2012).

         A. Qualified Written Request

         A servicer's duty to respond under certain RESPA subsections is triggered when the servicer receives a “qualified written request” (“QWR”). 12 U.S.C. § 2605(e)(1)(A)-(B); Medrano, 704 F.3d at 666. The statute defines QWR, see 12 U.S.C. § 2605(e)(1)(B)[5], but there are no “magic words” required. Medrano, 704 F.3d at 666. Any written inquiry that “(1) reasonably identifies the borrower's name and account, (2) either states the borrower's reasons for the belief that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower, and (3) seeks information relating to the servicing of the loan” is considered a QWR. Id. (adopting and quoting the Seventh Circuit's reasoning in Catalan v. GMAC Mortgage Corp., 629 F.3d 676, 685-87 (7th Cir. 2011)) (internal quotations omitted). However, the third requirement of the Medrano court's definition is inapplicable here. See Medrano, 704 F.3d at 666. The Medrano court made clear that the third part of its definition was actually regarding what would trigger a servicer's duty to acknowledge receipt of a QWR under section 2605(e)(1)(A), which requires that the request be a QWR and that the requested information in the QWR relate to the servicing of the loan. Id. at 666 n.4.[6] The Medrano court held that “letters challenging only a loan's validity or its terms are not qualified written requests that give rise to a duty to respond under § 2605(e).” Id. at 667.

         Whether section 2605(k)(1)(D) is triggered only by QWRs, or if any “request” will suffice is not completely clear. The plain language of the subsection only prohibits servicers from failing to respond to a “request from a borrower . . . for information about the owner or assignee of the loan[.]” Of the five subsections in section 2605(k)(1), two refer generally to requests, [7] and one refers to QWRs.[8] Further, the QWR definition in section 2605(e)(1)(B) begins by limiting the definition's scope “[f]or purposes of this subsection[.]” However, other district courts have assumed that only QWRs will trigger obligations under 2605(k)(1)(D). See e.g. Bever v. Cal-Western Reconveyance Corp., No. 1:11-CV-1548, 2013 WL 5492154, at *5-6 (E.D. Cal. Oct. 2, 2013)[9]; Malifrando v. Real Time Resols., Inc., No. 2:16-CV-0223, 2016 WL 6955050, at *5 (E.D. Cal. June 30, 2016).

         B. Damages

         A borrower who alleges a violation of RESPA section 2605 is entitled to “any actual damages to the borrower as a result of the failure” to comply with the statue. 12 U.S.C. § 2605(f)(1). “A number of courts have read the statute as requiring a showing of pecuniary damages in order to state a claim.” Allen v. United Fin. Mortg. Corp., 660 F.Supp.2d 1089, 1097 (N.D. Cal. 2009). “Courts have interpreted this requirement to plead pecuniary loss liberally.” Id. (quoting Yulaeva v. Greenpoint Mortg. Funding Inc., No. S-09-1504, 2009 WL 2880393, at *15 (E.D. Cal. Sept. 3, 2009)). In Watson v. Bank of America, N.A., the Southern District of California listed a number of damages claims that had been found to be actual damages for RESPA purposes: costs incurred by a debtor in mailing QWRs to a loan servicer, over calculation and overpayment of interest on a loan, the costs of repairing a borrower's credit, and the reduction or elimination of the borrower's credit limits. No. 16-CV-513, 2016 WL 3552061, at *12-13 (S.D. Cal. June 30, 2016). Even emotional distress and mental anguish may constitute actual damages under RESPA. Id.

         IV. Summary Judgment Standard

         Summary judgment should be granted where there is “no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A fact is material if it “might affect the outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is genuine if the evidence would enable a reasonable trier of fact to resolve the dispute in favor of the nonmoving party. See Id. At summary judgment, the judge's function is not to weigh the evidence and determine the truth but to determine whether there is a genuine issue for trial. Anderson, 477 U.S. at 249. In evaluating a motion for summary judgment, the Court must “draw all reasonable inferences from the evidence” in favor of the non-movant. O'Connor v. Boeing N. Am., Inc., 311 F.3d 1139, 1150 (9th Cir. 2002). If the “evidence yields conflicting inferences, summary judgment is improper, and the action must proceed to trial.” Id.

         “Where the parties file cross-motions for summary judgment, the court must consider each party's evidence, regardless under which motion the evidence is offered.” Las Vegas Sands, LLC v. Nehme, 632 F.3d 526, 532 (9th Cir. 2011). That is, the court may consider the plaintiff's evidence from its cross-summary judgment motion to determine defendant's summary judgment motion, and vice versa. See Fair Housing Council v. Riverside Two, 249 F.3d 1132, 1136-37 (9th Cir. 2001). In this instance, the district court “review[s] each motion . . . separately, giving the nonmoving party for each motion the benefit of all reasonable inferences.” Brunozzi v. Cable Comm., Inc., 851 F.3d 990, 995 (9th Cir. 2017), cert. denied, 138 S.Ct. 167 (2017).

         The court need consider only the cited materials, but it may consider any other materials in the record. Fed.R.Civ.P. 56(c)(3). If, after considering the arguments and materials in the record, it appears that reasonable jurors could find that the defendant is liable, then the court should not grant summary judgment. Cornwell v. Electra Cent. Credit Union, 439 F.3d 1018, 1027-28 (9th Cir. 2006). If, however, jurors of reason could not determine that plaintiff is entitled to a judgment in her favor, then summary judgment is appropriate. Id.

         V. ...

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