Niedermeyer v. Bank of America, N.A. et al

Filing 66

ORDER granting 44 Motion for Summary Judgment. The Court finds that the 19 motion to dismiss has been supplanted by the motion for summary judgment and is therefore moot. Plaintiff's claims and this civil action are dismissed with prejudice. Defendant is awarded its reasonable costs, by Judge R. Brooke Jackson on 12/14/11.(lsw, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Honorable R. Brooke Jackson

Civil Action No. 10-CV-01576-RBJ-CBS
RICHARD MATTHEW NIEDERMEYER,
Plaintiff,
v.
BANK OF AMERICA, N.A., as successor in interest to Countrywide Mortgage Co.,
Defendants.

ORDER

Defendant, Bank of America, N.A., (hereafter “Bank of America” or simply “the bank”)
moves for dismissal pursuant to Fed. R. Civ. P. 12(b)(6), or alternatively, for summary judgment
under Fed. R. Civ. P. 56(a).
Federal Jurisdiction
Plaintiff, Richard Mathew Niedermeyer, filed this case in the Grand County District
Court in June 2010. In July 2010 the bank removed the case to this Court on the basis of
diversity of citizenship. Although plaintiff did not seek a remand, the Court sua sponte issued an
order to show cause as to how the amount in controversy exceeded the sum of $75,000.
In response the defendant provided some somewhat obscure figures that show, according to the
defendant, how plaintiff’s claims for actual damages total just over $77,000. The defendant also
argues that plaintiff’s prayer for exemplary damages pushes the sum above the line. Plaintiff did
not attempt to show that he is seeking $75,000 or less. His counsel simply states that the case

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could probably be completed faster in state court, and that neither party would be prejudiced by a
remand.
I do not disagree that the case probably could have been completed sooner in state court.
The case has now languished in this Court for one and one half years, during which time it has
been reassigned to different judges twice. It is a type of case that is routinely and ably handled in
our state courts. However, if a party properly invokes federal jurisdiction, the Court must accept
it.
I will disregard the exemplary damages prayer in this case. It is not appropriate to
include an exemplary damages prayer in a case filed in a Colorado state court. C.R.S. § 13-21102(1.5). Defendant cites Jarmon v. Pacific Rail Services, LLC, 2007 WL 678644 at *6 (D.
Colo. 2007) but fails to cite other authority in this district to the contrary. See Klein v. State
Farm Fire and Cas. Co., 2009 WL 215369 at *1 (D. Colo. 2009). See also Ayala v. Kathleen
Tepper, 2008 WL 4861970 at *2 (D. Colo. 2008); Hill v. American Family Mut. Ins. Co., 2008
WL 4452141 at *1 (D. Colo. 2008). Moreover, the complaint in Jarmon was filed directly in
federal court. Whether or not the state statute applies in such a case, it applies to a complaint
filed in state court.
Nevertheless, because defendant has offered a theory and numbers, and plaintiff has
offered nothing to the contrary, the Court finds that the amount in controversy exceeds $75,000,
and federal jurisdiction exists.
Facts
The following facts are taken from the allegations in plaintiff’s complaint. In
approximately 2006 plaintiff financed the purchase of a home in Granby, Colorado through two
loans issued by Countrywide Mortgage Company. In 2008 the loan secured by a second deed of

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trust on the property went into default. In July 2008 plaintiff was approached by two loan
officers of the Bank of America, Jessica Worthy and Nakeya Johnson. The Bank of America had
by then acquired Countrywide. The two loan officers suggested that Mr. Niedermeyer could
consolidate the two loans and have his payments reduced to something he could afford. In order
to do this, however, he had to miss one monthly payment, apparently on the loan secured by the
first mortgage, thereby defaulting on the loan, and then make one payment of $6,000 and one
payment of $7,000 to “tie up the new loan.” After he made those payments and two additional
payments of approximately $3,030 each, the bank returned the latter two payments and informed
him that the loan restructuring would no longer work. Plaintiff never heard from either
individual again.
In October 2009 plaintiff was approached by a Bank of America loan officer named
Phillip Scourten who made similar promises to him about restructuring his loan. Mr. Scourten
allegedly requested that plaintiff make one payment of $16,000 and additional payments of
$2,000 every two weeks before his loan could be modified. Plaintiff made these payments
through December 15, 2009. However, on at least two occasions his tendered checks were
refused and returned to him.
Despite previous assurances otherwise, on February 28, 2010 Mr. Scourten told plaintiff
that the loan modification would not go through. He would not tell plaintiff the reason for this
change. A foreclosure sale was set for March 5, 2010 but was stopped when plaintiff filed for
Chapter 7 bankruptcy protection.
Plaintiff alleges that these actions by bank representatives caused his mortgage debt to
increase from $400,000 to $440,000. According to the defendant’s analysis for purposes of
removal, the additional $40,000 plus the sum of the extra payments plaintiff made allegedly as a

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result of the representatives of the bank’s agents pushed his total out of pocket damages above
$75,000. Plaintiff asserts four claims for relief: (1) breach of contract; (2) fraud; (3) civil
conspiracy; and (4) respondeat superior liability.
Motion to Dismiss [docket #19]
Defendant moves to dismiss plaintiff’s claims for failure to state a claim upon which
relief could be granted. The primary emphasis of the motion is defendant’s argument that the
claims are barred by the statute of frauds.
The applicable statute of frauds is found at C.R.S. § 38-10-124(2). It provides:
Notwithstanding any statutory or case law to the contrary, including but not
limited to section 38-10-112, no debtor or creditor may file or maintain an action
or a claim relating to a credit agreement involving a principal amount in excess of
twenty-five thousand dollars unless the credit agreement is in writing and signed
by the party against whom enforcement is sought.
A “debtor” is “a person who or entity which obtains credit or seeks a credit agreement
with a creditor or who owes money to a creditor.” C.R.S. 38-10-124(1)(c). Plaintiff has not
disputed that he is a “debtor” as defined in the statute. See Plaintiff’s Response to Defendant’s
Motion to Dismiss at 1.
A “creditor” is a financial institution which offers to extend, is asked to extend, or
extends credit under a credit agreement with a debtor. C.R.S. 38-10-124(1)(b). A “financial
institution” is “a bank, savings and loan association, savings bank, industrial bank, credit union,
or mortgage or finance company.” C.R.S. 38-10-124(1)(d). Plaintiff has not disputed that the
Bank of America is a “creditor” as defined in the statute. See Plaintiff’s Response at 1.
A “credit agreement” is:
(I)

A contract, promise, undertaking, offer, or commitment to lend, borrow,
repay, or forbear repayment of money, to otherwise extend or receive
credit, or to make any other financial accommodation;
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(II)

Any amendment of, cancellation of, waiver of, or substitution for any or
all of the terms or provisions of any of the credit agreements defined in
subparagraphs (I) and (III) of this paragraph (a); and

(III)

Any representations and warranties made or omissions in connection with
the negotiation, execution, administration, or performance of, or collection
of sums due under, any of the credit agreements defined in subparagraphs
(I) and (II) of this paragraph (a).

C.R.S. 38-10-124(1)(a). Plaintiff has not disputed that the agreements alleged to have occurred
between Mr. Niedermeyer and two representatives of the bank in or about July 2008 (Complaint
¶¶5-6) and between Mr. Niedermeyer and Mr. Scourten between October 2009 and February
2010 (Complaint ¶¶7-8) are “credit agreements” as defined in the statute or that the agreements
involve principal amounts in excess of twenty-five thousand dollars. See Plaintiff’s Response at
1.
The remaining question, therefore, is whether the agreements were in writing and signed
by a representative of the Bank of America. If not, plaintiff’s claims, including those sounding
in tort, cannot be maintained by the terms of C.R.S. 38-1-124(2). See Norwest Bank Lakewood,
Nat. Ass’n v. GCC Partnership, 886 P.2d 299, 301-02 (Colo. App. 1994). Plaintiff’s response to
the motion to dismiss states that he has located “at least two documents” that contain the bank’s
signatures and that “arguably are sufficient to provide written evidence of Defendant’s signatures
on the documents.” Plaintiff’s Response at 1. He adds that the motion is premature, and he
requests that he be allowed to conduct discovery.
A motion to dismiss is decided on the four corners of the complaint. Plaintiff did not
allege in the complaint that the credit agreements were in writing or signed by the bank, nor has
plaintiff sought leave to amend the complaint to make such allegations. The statute of frauds is
an affirmative defense that ordinarily would be asserted in an answer and then resolved on a

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motion for summary judgment or at trial. However, in some circumstances affirmative defenses
can be raised in a motion to dismiss. See, e.g., Dave Peterson Elec., Inc. v. Beach Mountain, 167
P.3d 175, 176-77 (Colo. App. 2007). Here, plaintiff is vulnerable to the motion to dismiss
simply because he makes no reference to any writing or signature in his complaint.
However, before the Court addressed the motion to dismiss, and probably because the
Court delayed so long in doing so, defendant filed a motion for summary judgment that is also
pending. In the rather odd circumstances, the Court finds that the motion to dismiss has been
supplanted by the motion for summary judgment and is therefore moot.
Motion for Summary Judgment [docket #44]
Defendant’s motion for summary judgment is likewise based upon the statute of frauds.
In support of the motion defendant provides (1) a letter from Mr. Niedermeyer dated May 14,
2008 “To whom it may concern,” apparently sent to the bank, in which he indicates that it has
been a rough year for him as a real estate agent because of the bad real estate market, but that
things were looking up, and he will be able to get his payments caught up; Ex. F; (2) testimony
from the plaintiff that in approximately May or June 2008 a bank employee, Jessica Worthy,
called him and indicated that he could get his payments (on the first note) reduced, but that he
would have to miss a payment or two to qualify for a special program that allow that; deposition
testimony from the plaintiff that this was never confirmed in any writing; Ex. B at 34-36, 76; (3)
two copies of a “Repayment Plan Agreement” dated June 3, 2008, that purports to set forth the
terms and conditions on which the plaintiff and the lender had agreed to repay delinquent
amounts; Ex. G and H; it was signed by both parties; it allowed plaintiff to repay delinquent
amounts while continuing to make regularly scheduled payments under the note on his first loan;
(4) evidence that plaintiff made a $7,000 payment in June 2008 and a $6,785.80 payment in July

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2008 under the Repayment Plan Agreement and received written confirmations; Ex. B at 81-83;
(5) a notice from the bank dated August 4, 2008 indicating that the Repayment Plan Agreement
was being cancelled because plaintiff missed a payment; Ex. K; deposition testimony from the
plaintiff that he did not make his August payment because he was verbally told by a bank
employee, Nakeya Johnson, to let the loan go into default again; Ex. B at 83-87; (6) a Loan
Modification Agreement dated August 29, 2008 that plaintiff signed on September 15, 2008; Ex.
L; this agreement increased the payments by about $135 a month and increased the principal
balance from $400,000 to $415,658.99; it contains an exculpatory provision whereunder the
borrower releases and waives all prior claims he might have had against the lender; (7) evidence
that plaintiff’s loan, as modified by the Loan Modification Agreement, went into default again in
May of 2009; Ex. B at 92-93; (8) documents of pre-approval of Mr. Niedermeyer for workout
assistance dated July 29, 2008, including a Negotiation Agreement, that Mr. Niedermeyer
signed; Ex. M; Ex. B at 98-99; the Negotiation Agreement confirmed that the note and deed of
trust remain in full force and effect unless modified in writing; (9) evidence that plaintiff
defaulted on this repayment agreement by failing to make the September 2009 payment when
due; Ex. N; Ex. B at 105; (10) deposition testimony from the plaintiff that he defaulted because
Philip Scourten, a bank employee, verbally instructed him to do so, because he had a new
program coming in the mail; Ex. B at 106, 110-11; (11) a letter from Mr. Niedermeyer dated
October 1, 2009 in which he indicates that he fell behind in his payment because of the crash of
the real estate market, but that he believes he can get back on track; (12) documents of preapproval of Mr. Niedermeyer for workout assistance dated October 13, 2009, again including the
Negotiation Agreement, that he reviewed and signed; Ex. Q; Ex. B at 106-108; (13) evidence
that plaintiff has not made a payment for a year before his May 19, 2011 deposition. Ex. B at 80.

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Plaintiff’s brief in response states that plaintiff’s payments were current when he was first
contacted by the bank. He says that he was told that he had to be in default before he could be
considered for refinancing, so he allowed his loan to go into default. He then worked with bank
employees Jessica Worthy and Phillip Scourten to attempt to get a modification. He received
documents that provided for revised monthly payments of approximately $5,000 as compared to
his previous payment of approximately $2,595. The balance owed to the bank increased from
$400,000 to $418,000. He states that while the parties were working on the refinancing, the
house was in foreclosure. However, Mr. Scourten continually advised him that there were no
problems, and that he would obtain a loan modification. Approximately one week before the
foreclosure sale, Mr. Scourten informed him that the modification was denied without providing
a reason. To avoid foreclosure, he filed for Chapter 7 bankruptcy protection.
These statements are, for the most part, consistent with the allegations in his complaint
and with the excerpts of his deposition testimony (Ex. B to defendant’s motion) discussed above.
They are not supported by any documents. Plaintiff does submit an affidavit (the copy of which
in the Court file is neither signed nor notarized). However, it simply states that “all of he (sic)
factual statements made by me or my representatives are true and correct.”
By way of argument, plaintiff states that the exculpatory agreements were not signed by
both parties and therefore are not enforceable. He acknowledges concern about the absence of
written confirmation of some of the statements made by bank employees, but he states that “it is
feasible that, based on surrounding actions and agreements the Court may find in Niedermeyer’s
favor.” Response at 3. He reiterates that while the bank was purportedly trying to help him, it
actually obtained $29,000 of additional payments for which he received nothing. He argues that
the signatures of bank employees on some of the agreements should satisfy the statute of frauds.

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He suggests that he is not the first person to have been misled into thinking that “pre-approval”
means approval.
Unfortunately, these arguments do not address the nub of the problem with the plaintiff’s
case. There are numerous writings documenting the various restructuring proposals and
agreements. However, plaintiff has not complained that the defendant broke any obligation it
incurred under those documents. His response to the motion for summary judgment makes no
attempt to analyze the actual documents. Rather, his complaint is that bank employees Jessica
Worthy, Nakeya Johnson and Phillip Scourten made additional verbal promises and agreements
regarding modification of his loan obligations on which he relied to his detriment. The statute
requires that any such agreements be written and signed by the lender.
I have read every one of the documents and deposition excerpts submitted by the
defendant to see whether there is any writing that might arguably satisfy the statute of frauds, but
I have found none. Nor has plaintiff pointed out any specific thing in any of these documents on
which he can rest his opposition to the motion. Once a party seeking summary judgment has
come forward with evidence indicating that there is no genuine and material fact dispute
regarding the applicability of the statute of frauds, the party opposing summary judgment has the
burden to come forward with affidavits, documents or other evidence indicating that there is a
genuine material fact dispute. See Fed. R. Civ. P. 56(c)(1)(A). Plaintiff has shown that there are
factual disputes, but he has not shown that the disputes are material to whether the statute of
frauds applies.
Although plaintiff has not raised the issue, I have also considered whether a colorable
argument can be made that C.R.S. § 38-10-124(2) does not apply because the credit
agreements(s) were not in excess of $25,000. However, the verbal agreements were for a

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restructuring of his loan. Plaintiff alleges, at a minimum, $29,000 in unnecessary payments
(Complaint ¶¶6, 7; response to motion for summary judgment at ), plus $40,000 or at least
$18,000 in increased debt (Complaint ¶11; response to motion for summary judgment at 2).
Moreover, as discussed in connection with the federal jurisdiction issue, plaintiff does not
dispute the calculations of defense counsel that put the amount of actual damages in controversy
above $75,000. The Court is unable to conclude from plaintiff’s pleadings that a reasonable
argument can be made that the alleged verbal agreements, either singly or in combination, did
not exceed $25,000.
It may be that plaintiff was poorly treated by bank employees. However, the Court finds
that there is no genuine issue of material fact in dispute concerning the applicability of the statute
of frauds. The Court concludes as a matter of laws that plaintiff’s claims are barred by C.R.S. §
38-10-124(2). Accordingly, the motion for summary judgment is granted. Plaintiff’s claims and
this civil action are dismissed with prejudice. Defendant is awarded its reasonable costs.
DATED this 14th day of December, 2011.
BY THE COURT:

___________________________________
R. Brooke Jackson
United States District Judge

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