Ernest Bassknight, et al v. Deutsche Bank Natl Trust Co., et al

Filing

REVISED UNPUBLISHED OPINION FILED. [7977969-2] [14-11371]

Case: 14-11371

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Date Filed: 08/06/2015

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 14-11371
Summary Calendar
ERNEST BASSKNIGHT; EMMA BASSKNIGHT,

United States Court of Appeals
Fifth Circuit

FILED
August 5, 2015
Lyle W. Cayce
Clerk

Plaintiffs - Appellants
v.
DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee for the
Holders of GSAMP 2002-HE2, Mortgage Pass through Certificates, Series
2002-HE2; OCWEN LOAN SERVICING, L.L.C.,
Defendants - Appellees

Appeal from the United States District Court
for the Northern District of Texas
USDC No. 3:12-CV-1412
Before DAVIS, CLEMENT, and COSTA, Circuit Judges.
PER CURIAM:*
In this real estate foreclosure case, plaintiffs-appellants Ernest and
Emma Bassknight (collectively, the “Bassknights”) challenge the district
court’s grant of summary judgment in favor of the defendants-appellees
Deutsche Bank National Trust Company (“Deutsche Bank”) and Ocwen Loan

Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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Servicing, LLC (“Ocwen”) (collectively, the “Lenders”). For the reasons below,
we AFFIRM.
FACTS AND PROCEEDINGS
The Bassknights purchased property in Grand Prairie, Texas and
executed a note and deed of trust. The original lender assigned the note and
deed of trust to Deutsche Bank. Ocwen became the mortgage servicer of the
Bassknights’ loan in September 2011.
In December 2011 Ocwen sent the Bassknights a notice of acceleration
and foreclosure. Ocwen advised the Bassknights to apply for a loan
modification even though the Bassknights had previously warned Ocwen that
their lender did not participate in loan modifications. Ocwen repeatedly
assured the Bassknights that they were eligible for a loan modification and
that their property would not be foreclosed upon during the Home Affordable
Modification Program evaluation. Nevertheless, the Bassknights received
letters of foreclosure during this period. In January 2012 Ocwen sent the
Bassknights documents to complete. Although Ocwen indicated that these
documents were related to a deed-in-lieu application, the Bassknights contend
that they were a loan modification application. The Bassknights completed the
forms and returned them to Ocwen.
On February 7, 2012, the Bassknights received a letter informing them
that their loan modification application had been denied because, as the
Bassknights had previously warned, the Bassknights’ lender did not
participate in loan modifications. The letter further informed the Bassknights
that they had thirty days to pursue alternative loss mitigation options.
Although the letter stated that a foreclosure sale would not occur during the
thirty-day period, Ocwen completed a foreclosure sale on the same day it sent
the letter to the Bassknights.
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The Bassknights filed a complaint in Texas state court. They alleged,
inter alia, that the Lenders violated the Texas Debt Collection Practices Act
(“TDCPA”) and engaged in negligent misrepresentation. The Lenders removed
the action to the United States District Court for the Northern District of
Texas. The Lenders moved to dismiss the Bassknights’ first amended
complaint. The magistrate judge converted the motion into a motion for
summary judgment. The magistrate judge recommended that the district court
grant the Lenders’ motion and dismiss the Bassknights’ claims against the
Lenders with prejudice. The district court adopted the magistrate judge’s
findings and recommendations and dismissed their claims.
DISCUSSION
A. The Texas Debt Collection Practices Act
The Bassknights challenge the district court’s decision to dismiss their
claims under the TDCPA, Tex. Fin. Code § 392.304(a)(8), (19). Section
392.304(a)(8) prohibits a debt collector from “misrepresenting the character,
extent, or amount of a consumer debt, or misrepresenting the consumer debt’s
status in a judicial . . . proceeding.” Section 392.304(a)(19) prohibits a debt
collector from “using any other false representation or deceptive means to
collect a debt.”
There is no viable TDCPA claim when a mortgagee discusses a loan
modification because “statements about loan-modification applications and the
postponement of foreclosure do not concern the character, extent, or amount of
the home loan, so they are not covered by the statute.” Thompson v. Bank of
Am., N.A., 783 F.3d 1022, 1026 (5th Cir. 2015) (internal quotation marks
omitted); cf. Buchanan v. Compass Bank, No. 02-14-00034-CV, 2015 WL
222143, at *4 (Tex. App. Jan. 15, 2015). The Thompson court suggested,
however, that affirmatively promising not to foreclose may waive a lender’s
right to do so. See 783 F.3d at 1025. Here, the Lenders promised in writing that
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they would not conduct a foreclosure sale for thirty days. We assume without
deciding that the Lenders violated the TDCPA by breaking their promise not
to initiate a foreclosure sale during that time.
Even so, we affirm because the Bassknights failed to adduce evidence
that they sustained actual damages. See Richardson v. SV Almeda I Ltd.
P’ship, No. 01-11-01004-CV, 2013 WL 4680392, at *9 (Tex. App. 2013)
(affirming dismissal of TDCPA claim for failure to show damages). The
Bassknights suggest that if the Lenders had not promised that they had thirty
days to consider their options, they would have filed for bankruptcy to save
their home. But the Lenders conducted a foreclosure sale of the Bassknights’
home before the Bassknights received the February 7 letter. And under Texas
law, the Bassknights could not recover the foreclosed property by filing a
bankruptcy petition. See, e.g., Coleman v. Williams, 538 F. App’x 513, 515 (5th
Cir. 2013); United States v. Bishop, 262 B.R. 401, 405-06 (W.D. Tex. 2000). The
Bassknights fail to adduce any evidence that they sustained actual damages.
Accordingly, we affirm the district court’s dismissal of the Bassknights’
TDCPA claim.
B. Negligent Misrepresentation
The Bassknights also assert that the district court erred in dismissing
their claim for negligent misrepresentation.
Under Texas law, promises of future conduct will not support a
negligent-misrepresentation claim. See De Franceschi v. BAC Home Loans
Servicing, L.P., 477 F. App’x 200, 205 (5th Cir. 2012); see also Scherer v. Angell,
253 S.W.3d 777, 781-82 (Tex. App. 2007). In De Franceschi, this court held that
a bank’s promise not to foreclose during the loan modification evaluation was
a promise of future action “rather than [a] representation[] of existing fact.”
477 F. App’x at 205. We hold that the Lenders’ promise not to foreclose for
thirty days was a promise regarding future conduct. See id.
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We would also affirm the district court’s decision because the
Bassknights failed to show that they relied on the February 7 letter to their
detriment. See McCamish, Martin, Brown & Loeffler v. F.E. Appling Interests,
991 S.W.2d 787, 791 (Tex. 1999) (requiring plaintiff asserting negligent
misrepresentation claim to prove detrimental reliance). The Bassknights
argue that the February 7 letter caused them to forego the opportunity to stop
the foreclosure through bankruptcy. But as discussed above, once the
foreclosure sale occurred, a bankruptcy petition would not have prevented the
loss of the Bassknights’ home.
Accordingly, we affirm the district court’s dismissal of the Bassknights’
negligent misrepresentation claim.
CONCLUSION
For the reasons explained, we AFFIRM the judgment of the district
court.

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