Blackburn et al v. Bank of America Corporation
Filing
68
ORDER granting in part and denying in part 33 Motion to Dismiss Complaint. Ordered by Judge Clay D. Land on 09/13/2012.(aaf)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
COLUMBUS DIVISION
TODD BLACKBURN,
BLACKBURN,
and
SAMANTHA *
*
Plaintiffs,
*
vs.
CASE NO. 4:11-CV-39 (CDL)
*
BAC HOME LOANS SERVICING, LP,
*
Defendant.
*
O R D E R
The saga has become familiar:
a person tastes part of the
American dream by purchasing a home; the purchase is financed by
a loan which is secured by a security interest in the home; a
dispute or misunderstanding arises leading to a missed payment;
the
situation
spirals
out
of
control;
the
home
is
lost
or
threatened to be lost through foreclosure; and the sweet taste
of the American dream becomes a bitter after-taste flavored by
distress and litigation.
familiar:
The legal saga that ensues is equally
the disgruntled homeowner alleges a laundry list of
causes of action to remedy the tragic loss; the lender, often
relying on the documents signed by the homeowner, responds that
the claims are so devoid of merit that they must be dismissed
summarily
without
discovery
or
trial;
and,
the
judge
must
unravel the claims and allegations to determine whether a claim
has been sufficiently stated to survive immediate dismissal.
In
Blackburn
the
present
action,
(“Blackburns”)
Plaintiffs
assert
the
Todd
following
and
Samantha
claims
against
Defendant BAC Home Loans Servicing, LP (“BAC”) based on BAC’s
servicing of their mortgage: “intentional and negligent failure
to exercise due care in servicing loan”; violations of the Real
Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. §§ 26012617; trespass; conversion; and breach of contract.1
See Pls.’
Third Am. Compl., ECF No. 30 [hereinafter 3d Am. Compl.].
BAC
filed a Motion to Dismiss (ECF No. 33) seeking dismissal of all
claims except the Blackburns’ claim for conversion.
For the
following reasons, the Court dismisses the Blackburns’ state law
claims that are based on allegations that BAC made inaccurate
reports to the credit bureaus, their claim for “intentional and
negligent failure to exercise due care in servicing loan,” and
their RESPA claim asserted under 12 U.S.C. § 2605(k).
The Court
declines to dismiss the Blackburns’ remaining claims, including
their trespass claim, breach of contract claim, and RESPA claim
brought under 12 U.S.C. § 2605(e).
MOTION TO DISMISS STANDARD
When considering a 12(b)(6) motion to dismiss, the Court
must
accept
as
true
all
facts
1
set
forth
in
the
plaintiff=s
The Blackburns initially brought claims for fraud and defamation, but
have voluntarily withdrawn those claims. Pls.’ Am. Resp. in Opp’n to
Def.’s Am. Mot. to Dismiss Counts I-V, VII & IX of Pls.’ Third Am.
Compl. & Incorporated Mem. of Law 1, ECF No. 36 [hereinafter Pls.’ Am.
Resp.].
2
complaint
and
limit
its
consideration
exhibits attached thereto.
to
the
pleadings
and
Bell Atl. Corp. v. Twombly, 550 U.S.
544, 556 (2007); Wilchombe v. TeeVee Toons, Inc., 555 F.3d 949,
959
(11th
Cir.
2009).
“To
survive
a
motion
to
dismiss,
a
complaint must contain sufficient factual matter, accepted as
true, to ‘state a claim to relief that is plausible on its
face.’”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (quoting Twombly,
550 U.S. at 570).
The complaint must include sufficient factual
allegations “to raise a right to relief above the speculative
level.”
Twombly, 550 U.S. at 555.
“[A] formulaic recitation of
the elements of a cause of action will not do[.]”
Id.
Although
the complaint must contain factual allegations that “raise a
reasonable expectation that discovery will reveal evidence of”
the
plaintiff=s
claims,
id.
at
556,
“Rule
12(b)(6)
does
not
permit dismissal of a well-pleaded complaint simply because ‘it
strikes
a
savvy
judge
that
actual
proof
of
those
facts
is
improbable,’” Watts v. Fla. Int’l Univ., 495 F.3d 1289, 1295
(11th Cir. 2007) (quoting Twombly, 550 U.S. at 556).
FACTUAL ALLEGATIONS
Accepted as true, the alleged facts are as follows.2
2
The following recitation of the facts is based on the Blackburns’
allegations
and
reasonable
inferences
from
those
allegations.
Therefore, it is necessarily slanted toward the Blackburns’ position
and does not represent an objective determination of the facts by the
Court as a fact finder. Such determination would be inappropriate at
this stage of the proceedings.
3
In
March
2006,
the
Blackburns
obtained
a
federally-
regulated loan to purchase a home by executing a promissory note
in
the
amount
of
$162,418.00
in
favor
of
Taylor,
Bean
and
Whitaker Mortgage Corporation (“TB&W”) and conveying a security
interest in their home to TB&W.
The promissory note required
the Blackburns to pay regular monthly payments to TB&W.
Mr.
Blackburn, an active duty soldier in the United States Army,
“set up an allotment at the Finance Office at Ft. Benning to
have his monthly mortgage payment automatically deducted from
his U.S. Army paycheck and sent directly to TB&W.”
Compl. ¶ 10.
3d Am.
The Blackburns’ payments to TB&W were timely and
current, and no problems arose while TB&W serviced the loan.
Mr. Blackburn subsequently received a letter dated August
23, 2009 informing him that effective September 1, 2009, the
Blackburns’ loan was assigned to BAC for servicing.
3d Am.
Compl. Ex. 1, Letter from BAC to T. Blackburn (Aug. 23, 2009) 1,
ECF No. 30-1 at 2.
regularly
scheduled
sufficient
being
Due to the timing of the letter and the
time
paid
to
to
allotments,
change
TB&W
to
their
BAC.
the
Blackburns
next
And
monthly
this
did
not
have
allotment
from
proverbial
pebble
eventually became the giant snowball that allegedly destroyed
the Blackburns’ dream.
Because
the
regularly
scheduled
September
allotment
had
been sent to TB&W and not to BAC, BAC’s system showed that the
4
Blackburns had not made their monthly payment.
BAC then sent
Mr. Blackburn a letter on September 9, 2009 stating that the
Blackburns were delinquent on their loan.
3d Am. Compl. Ex. 2,
Letter from BAC to T. Blackburn (Sept. 9, 2009) 1, ECF No. 30-1
at 8.
Compounding the initial error, BAC continued to send
delinquency letters to the Blackburns even though they had made
their payment to BAC’s predecessor in interest, TB&W.
Plaintiffs
suggest
was
a
super-charged
aggressive
In what
collection
effort, BAC spit out letters so regularly that the Blackburns
sometimes received two letters on the same day.
On September
16, 2009, BAC began sending Mr. Blackburn “Notices of Intent to
Accelerate” that threatened foreclosure.
E.g., 3d Am. Compl.
Ex. 3, Letter from BAC to T. Blackburn (Sept. 16, 2009), ECF No.
30-1 at 29.
Blackburns
BAC’s loan statements consistently showed that the
were in default by two payments, even
though the
Blackburns had set up an allotment at the beginning of the loan
that to their knowledge was deducting the monthly payments from
Mr. Blackburns’ pay each month.
E.g., 3d Am. Compl. Ex. 4,
03/30/2011 Statement, ECF No. 30-1 at 58.
In
September
2009,
Mr.
Blackburn
checked
his
military
allotments to obtain proof that his allotment was being paid to
TB&W.
Mrs. Blackburn obtained a statement from Army Finance
showing the trace numbers of the military allotments sent to
TB&W in an effort to convince BAC that they were not in default
5
on their loan payments.
See 3d Am. Compl. Ex. 5, Pay Inquiry,
ECF No. 30-1 at 61 (listing trace numbers for July 31, 2009 and
September 1, 2009
allotments).
On September 22, 2009, Mrs.
Blackburn obtained additional documents from the Army showing
Mr.
Blackburn’s
military
2009 were paid to TB&W.
allotments
for
August
and
September
In short, the Blackburns had proof that
the allegedly unpaid monthly payments were deducted from Mr.
Blackburn’s pay and sent directly to TB&W, which is the entity
from whom the Blackburns had obtained the loan and to whom the
original promissory note indicated the payments should be made.
Mrs. Blackburn took this documentation to the BAC office in
Columbus, Georgia and spoke with BAC employee Heather Smith.
Heather
Smith
called
Autry
Gray
with
BAC
and
“was
told
to
disregard notifications of being in default and that Bank of
America would submit a payment request to TB&W which would take
sixty to ninety days.”
3d Am. Compl. ¶ 22.
BAC employees made
similar notations of the same during this discussion.
3d Am.
Compl. Ex. 7, Loan History, ECF No. 30-1 at 68.
On November 19, 2009, BAC responded to the documentation
provided
by Mrs. Blackburn
to
Heather
Smith
and
Autry
Gray.
Instead of focusing on straightening out the allotment payments
that had been made to TB&W which presumably should have gone to
BAC,
BAC
provided
a
type
of
uniform
response
asking
Mr.
Blackburn to send “a copy of the cancelled check (front and
6
back) or a bank source receipt (you can obtain from your bank)
if payment was made via Home banking along with a copy of your
Bank Statements” as “required back-up” proof of payment.
3d
Am. Compl. Ex. 8, Letter from BAC to T. Blackburn (Nov. 19,
2009), ECF No. 30-1 at 77.
Of course, with an allotment, there
would be no cancelled check or credit on a bank statement.
BAC
had failed to understand the nature of the problem, even though
the Blackburns and the local BAC branch had informed BAC that
the payments were paid by military allotment.
a
misunderstanding
another
letter
on
of
the
December
nature
28,
of
2009,
the
Continuing under
problem,
inexplicably
cancelled checks and bank statements.
BAC
sent
requesting
3d Am. Compl. Ex. 9,
Letter from BAC to T. Blackburn (Dec. 28, 2009), ECF No. 30-1 at
79.
Then, to add to the confusion, BAC sent another letter on
the same day acknowledging receipt of correspondence from Mr.
Blackburn and stating that BAC was “in the process of obtaining
the
documentation
questions
and
and
information
concerns”
and
necessary
promising
to
to
address
“provide
complete response within twenty (20) business days.”
[his]
a
more
3d Am.
Compl. Ex. 10, Letter from BAC to T. Blackburn (Dec. 28, 2009),
ECF No. 30-1 at 81.
For
a
year
and
a
half,
Mr.
Blackburn
made
frustrated
attempts to correct a misunderstanding that should have been
easily remedied and arguably was not of his own making.
7
These
attempts included numerous telephone calls to BAC’s toll free
numbers.
These conversations were unproductive and typically
concluded with the BAC representative parroting the call center
script: “When are you going to make the payments?”.
Sometime after July 30, 2010, Mrs. Blackburn once again
went to the Columbus, Georgia BAC office, taking with her copies
of Mr. Blackburns’ July 31, 2009 through July 31, 2010 earnings
statements and spoke with employee Fabien Smith.
called BAC’s research department.
Fabien Smith
The research department told
him that the problem would be “straightened out right away.”
Am. Compl. ¶ 28.
documentation
3d
Fabien Smith and Mrs. Blackburn also faxed
to
BAC
regarding
the
loan.
Following
these
efforts, Mr. Blackburn again made numerous phone calls to BAC,
attempting to explain that his payments were all being made by
military allotment.
In November 2010, Integrity Field Service employees came
onto
the
Blackburns’
property and home.
property
and
took
photographs
of
the
The day before Thanksgiving that year, Mr.
Blackburn confronted one of them who stated that he worked for
Integrity
Field
Services.
That
agent
gave
Mr.
Blackburn
a
business card stating his name as “Rayburn Wilson,” a salesman
for a Carl Gregory car dealership.
3d Am. Compl. Ex. 16, R.
Wilson Business Card, ECF No. 30-1 at 108.
But, the agent then
wrote on the back of the card the name “Rodney Russell,” a phone
8
number, and “Integrity Field Services.”
3d Am. Compl. Ex. 17,
Back of Business Card, ECF No. 30-1 at 110.
very
concerned
about
taking photographs.
to
return
to
the
this
man
snooping
Mr. Blackburn was
around
his
home
and
Integrity Field Service employees continued
property
to
take
pictures
and
would
place
pieces of paper in the crack of the Blackburns’ front door.
E.g., 3d Am. Compl. Ex. 18, Printed Note, ECF No. 30-1 at 112
(giving contact info to call “loan servicing” and stating “[a]n
independent property inspector visited your property today for
Bank Name: CHL.”).
BAC sent a letter dated February 10, 2011 acknowledging
receipt of Mr. Blackburn’s “request regarding [his] payment sent
to the previous lender (Taylor Bean and Whitaker).”
3d Am.
Compl. Ex. 12, Letter from BAC to T. Blackburn (Feb. 10, 2011),
ECF No. 30-1 at 97.
The letter stated that BAC was unable to
respond to the inquiry without further information and
again
requested a copy of Mr. Blackburn’s cancelled check, which of
course
did
not
exist.
The
Blackburns
continued
to
receive
letters threatening foreclosure through the date of the filing
of the Third Amended Complaint in this action.
E.g., 3d Am.
Compl. Ex. 13, Letter from BAC to T. Blackburn (Mar. 1, 2011),
ECF No. 30-1 at 99.
On March 9, 2011, Mrs. Blackburn emailed Fabien Smith at
BAC to check on the status of the loan.
9
3d Am. Compl. Ex. 14,
Email from S. Blackburn to F. Smith (Mar. 9, 2011), ECF No. 30-1
at 102.
Fabien Smith responded that he had again informed the
BAC researchers that no physical check would have been sent and
that the payments were made by military allotment.
stated
that
BAC
was
“assuring
[him]
this
time
He further
it
will
get
credited to the account,” “this will not be reported and affect
[Mr. Blackburn’s] credit,” he was “[s]orry for all of this,” and
he would keep her posted.
3d Am. Compl. Ex. 15, Email from F.
Smith to S. Blackburn (Mar. 14, 2011), ECF No. 30-1 at 106.
of
that
employees
date,
had
at
come
least
two
onto
the
more
Integrity
Blackburns’
Field
property
As
Service
and
taken
pictures of their home.
Mr.
Blackburn
was
particularly
sensitive
about
adverse
credit information appearing on his credit report because it
could
negatively
affect
his
Army
career.
BAC
at
all
times
assured the Blackburns that BAC would not report negative credit
information on their credit reports.
The Blackburns relied on
these assurances and took no further action to see that BAC did
not report a default status to the credit bureaus.
On March 31, 2011,
credit
reports
reported
him
beginning
in
and
two
May
Mr. Blackburn ordered copies of his
much
months
2010.
to
his
dismay
delinquent
The
learned
on
Blackburns
his
that
loan
maintain
BAC
had
payments
that
these
reports were false, that BAC knew they were false, that BAC
10
acted
recklessly
information,
and
regarding
the
that
reports
the
reporting
of
damaged
the
their
false
credit
reputation.
On November 29, 2011, Mr. Blackburn sent a letter to BAC at
the address designated by BAC for receipt of “qualified written
requests.”
The letter included his name and identifying account
information and stated the following:
I have repeatedly requested that all fees and
charges collected by you on my account be credited
back to me.
Again, I request that you do so immediately and
inform me, in writing, what amounts have been credited
to my account, what they were collected for in the
first place, and why they were collected by you.
3d Am. Compl. Ex. 19, Letter from T. Blackburn to BAC (Nov. 29,
2011), ECF No. 30-1 at 114.
BAC acknowledged receipt of this
letter by letter dated December 8, 2011 and promised a complete
response within twenty business days.
3d Am. Compl. Ex. 20,
Letter from BAC to T. Blackburn (Dec. 8, 2011), ECF No. 30-1 at
116; 3d Am. Compl. ¶¶ 63-65.
BAC then sent a letter stating
that it had finished researching the issue of fees due on the
account and that it is “unable to waive the fees in the amount
of
$15.66.”
3d
Am.
Compl.
Ex.
21,
Letter
Blackburn (Dec. 14, 2011), ECF No. 30-1 at 118.
from
BAC
to
T.
By this letter,
BAC did not fully respond to the November 29, 2011 letter’s
requests and sent no further letters on the matter.
11
By calling
BAC, Mr. Blackburn eventually learned that BAC “had been taking
property inspection fees from [his] payments for a number of
months and that he still owed a balance.”
3d Am. Compl. ¶ 69.
In that conversation, the BAC representative promised to send
something in writing detailing the fees due, but Mr. Blackburn
never received anything to that effect.
further
response
or
make
appropriate
BAC did not make any
corrections
to
the
Blackburns’ account.
In January and February 2012, BAC took portions of the
Blackburns’ monthly payments “for unauthorized and unexplained
‘fees due’ when [the Blackburns] did not owe those unauthorized
fees”
or
Further,
any
on
statements,
other
both
BAC
fees.
the
3d
Am.
Blackburns’
incorrectly
Compl.
January
stated
that
¶
and
it
53-H,
I,
February
had
&
K.
2012
received
$1,062.62 from Mr. Blackburn, when it had received $1,070.00
from his military allotment.
“unexplained ‘fees due.’”
It had applied the difference to
Id. ¶ 53-J.
As a result of this whole ordeal, the Blackburns claim to
have “suffered a great deal of mental stress . . . suffered
emotionally, physically and financially . . . [and] expended
time and money.”
3d Am. Compl. ¶¶ 45-46.
DISCUSSION
BAC seeks dismissal of all of the Blackburns’ claims except
for their conversion claim.
12
I.
Preemption of State Law Claims
BAC first makes the blanket argument that to the extent
that the Blackburns allege any state law claims arising from
BAC’s
reporting
reporting
of
agencies,
allegedly
those
false
claims
information
are
preempted
to
by
credit
the
Fair
Credit Reporting Act (“FCRA”), 15 U.S.C. § 1681t(b)(1)(F).
The
Blackburns respond that BAC’s FCRA preemption arguments are now
moot in light of their withdrawal of their claims for fraud and
defamation based on BAC’s reporting information to the credit
bureaus.
In reply, BAC contends that the Blackburns continue to
rely
allegations
on
that
BAC
reported
false
information
to
credit bureaus in support of their remaining claims for damages,
including “damages to credit reputation.”
that
§
1681t(b)(1)(F)
of
the
FCRA
Further, BAC argues
preempts
the
Blackburns’
claims and any damages to the extent that they are based on
allegations that BAC reported false information to the credit
bureaus.
The Blackburns claim that BAC violated Georgia common law
because
it
“intentionally
as
well
as
negligently
failed
to
exercise due care in servicing the Blackburns’ loan” based on
BAC’s incorrect “reports to the credit bureaus.”
¶¶ 50, 52.
3d Am. Compl.
They also allege that “[Mr. Blackburn’s] credit
reputation has been damaged by [BAC’s] false reporting to the
credit
bureaus”
and
that
BAC
13
“acted
with
malice
and
with
knowledge that the information reported to the credit bureaus
was false or with reckless disregard of whether it was false or
not.”
Id. ¶¶ 43-44.
The Blackburns continue to rely on these
allegations: “The factual allegation remains, and Defendant does
not deny, that it falsely reported Plaintiffs as delinquent to
the credit agencies[.]”
Pls.’ Am. Resp. 2; see also id. at 7,
10 (stating that BAC assured the Blackburns that nothing would
appear
on
importance
their
of
credit
that
report
issue).
and
The
that
point
BAC
is
understood
not
reported false information to the credit bureaus.
whether
the
BAC
The issue is
whether the Blackburns can maintain state law claims for that
conduct or whether such claims are preempted by federal law.
The Court finds that those claims are preempted.
Section
1681t(b)(1)(F)
states:
“No
requirement
or
prohibition may be imposed under the laws of any State (1) with
respect to any subject matter regulated under . . . (F) section
1681s-2
of
this
title,
relating
to
the
responsibilities
of
persons who furnish information to consumer reporting agencies
.
.
.”
Section
furnishers
of
1681s-2
information
enumerates
to
the
consumer
responsibilities
reporting
of
agencies,
including the “[d]uty of furnishers of information to provide
accurate
information”
information.”
and
the
“[d]uty
to
15 U.S.C. § 1681s-2(a)(1)-(2).
14
correct
and
update
The
Blackburns’
claims
based
on
allegations
that
BAC
reported inaccurate credit information to credit bureaus clearly
arise from conduct regulated by § 1681s-2.
Therefore, any
claims based on these allegations are directly preempted by the
plain language of the FCRA, 15 U.S.C. § 1681t(b)(1)(F).
See
Ross v. FDIC, 625 F.3d 808, 813 (4th Cir. 2010) (holding similar
claims under North Carolina law “squarely preempted by the plain
language of the FCRA”).
Relying
Blackburns
on
opinions
argue
that
from
§
various
district
1681t(b)(1)(F)
only
courts,
preempts
the
state
statutory claims and not state common law claims like those they
have asserted.
It appears that the Eleventh Circuit Court of
Appeals has not yet weighed in on this issue.
Two circuit
courts of appeal have addressed the issue and have reached a
conclusion contrary to the position asserted by the Blackburns.
The Court finds these circuit court opinions persuasive.
The Second and Seventh Circuits have rejected a statutorycommon
law
applies
equally
claims.
103,
distinction
preempt
have
held
state
that
§
statutory
1681t(b)(1)(F)
and
common
law
See Premium Mortg. Corp. v. Equifax, Inc., 583 F.3d
106-07
(2d
“[p]laintiff’s
claims
to
and
under
provision
is
Cir.
2009)
distinction
this
.
.
section
.
(per
curiam)
between
statutory
of
FCRA’s
the
unpersuasive”
15
and
(stating
that
and
common-law
express
preemption
holding
that
the
word
“laws” in § 1681t(b) encompasses state statutory and common law
claims); Purcell v. Bank of Am., 659 F.3d 622, 623-24 (7th Cir.
2011)
(applying
1681t(b)(1)(F)
the
to
conclusion
reverse
the
of
Premium
district
Mortgage
court’s
to
finding
§
that
plaintiff’s state law claims were not preempted); Macpherson v.
JPMorgan Chase Bank, N.A., 665 F.3d 45, 47-48 (2d Cir. 2011)
(per curiam) (stating that § 1681t(b)(1)(F) is not limited to
preempting
only
1681t(b)(1)(F)
defamation
based
on
and
statutory
preempted
and
plaintiff’s
intentional
allegations
claims
that
common
infliction
the
bank
holding
of
law
district
conclusion.
court
in
this
willfully
Circuit
claims
emotional
has
§
for
distress
provided
credit information to a credit reporting agency).
other
that
false
At least one
reached
a
similar
See Spencer v. Nat’l City Mortg., 831 F. Supp. 2d
1353, 1362-63 (N.D. Ga. 2011) (holding that “preemption under §
1681t(b)(1)(F) extends not only to state statutory claims, but
to state common-law claims as well.”).
1681t(b)(1)(F)
claims
for
preempts
damages
based
the
on
The Court finds that §
Blackburns’
Georgia
allegations
of
BAC’s
common
law
inaccurate
reporting to credit bureaus, including intentional and negligent
servicing and harm to credit reputation.
16
II.
Remaining State Law Claims
A.
Intentional and Negligent Failure to Exercise Due Care
in Servicing Loan
The Blackburns allege that BAC “intentionally ignored the
Blackburns’ notice to [BAC] that they were not and had never
missed making a mortgage payment,” that “[d]espite being put on
notice
that
[BAC’s]
information
concerning
the
status
of
Plaintiff’s loan was incorrect, [BAC] continued to harass the
Plaintiffs with letters, [and] threats,” and that BAC’s conduct
in servicing the Blackburns’ loan amounted to negligence.
3d
Am. Compl. ¶¶ 50-52.
BAC seeks dismissal of these claims.
It argues that the
only duties it owed to the Blackburns regarding the servicing of
their loan were contractual, and under Georgia law, the failure
to
perform
defendant’s
a
contract
mere
is
negligent
not
a
tort.
performance
of
In
a
Georgia,
“[a]
contractual
duty
does not create a tort cause of action; rather, a defendant’s
breach of a contract may give rise to a tort cause of action
only if
the defendant
has also breached
created by statute or common law.”
an independent duty
Fielbon Dev. Co. v. Colony
Bank of Houston Cnty., 290 Ga. App. 847, 855, 660 S.E.2d 801,
808 (2008) (alteration in original).
The duties BAC owed to the
Blackburns in the servicing of their loan are the duties that
the parties agreed to in their contract, or, in this case, the
17
duties agreed to between the Blackburns and TB&W, which were
assumed by BAC upon the assignment of the loan for servicing.
The Blackburns point to no independent duty, but they simply
suggest that the negligent performance of a contractual duty
gives
rise
to
a
tort,
established Georgia law.
(holding
that
a
bank
which
is
inconsistent
with
well-
See id. at 856, 660 S.E.2d at 808-09
whose
duties
all
arose
out
of
its
administration of a loan was not subject to suit in tort based
on those grounds).
To the extent that the Blackburns allege
such a claim, it must be dismissed.
B.
Trespass
The Blackburns also allege that BAC committed the tort of
trespass
when
it
sent
agents
onto
their
property
photographs and leave notes in their front door.
to
take
BAC seeks
dismissal of the Blackburns’ trespass claim, asserting that the
claim fails because under the terms of the Blackburns’ mortgage
BAC had permission to do what it did.
Although under Georgia
law, any unlawful interference with another’s right of enjoyment
of
his
private
property
is
a
trespass,
O.C.G.A.
§
51-9-1,
consent effectuated by contract may modify this property right,
Tacon v. Equity One, Inc., 280 Ga. App. 183, 188, 633 S.E.2d
599, 604 (2006).
18
As evidence of the Blackburns’ consent for BAC’s entry on
their property, BAC cites to paragraph 7 of the Mortgage which
states in pertinent part:
Lender or its agent may make reasonable entries upon
and inspections of the Property. If it has reasonable
cause, Lender may inspect the interior of the
improvements on the Property.
Lender shall give
Borrower notice at the time of or prior to such an
interior inspection specifying such reasonable cause.
3d Am. Compl. Ex. 34, Mortgage ¶ 7, ECF No. 30-1 at 169.
BAC
construes this paragraph as “expressly permit[ting] entry onto
their property for any reason” and requiring “reasonable cause”
only for interior and not exterior inspections.
to Dismiss 25, ECF No. 33.
Def.’s Am. Mot.
This interpretation ignores the
general requirement that all entries and inspections must be
“reasonable.”
Mortgage ¶ 7.
The Blackburns allege that the
inspections were not reasonable because they timely paid their
mortgage by military allotment, they worked to correct BAC’s
assertion of default and assessment of fees, they objected to
BAC’s repeated entry on their property, and yet, BAC’s agents
continued
to
repeatedly
pictures,
sometimes
enter
onto
surreptitiously
the
by
property
hiding
their
and
take
identity
with a fake business card and sometimes aggressively through a
physical confrontation with Mr. Blackburn.
The Court finds that
these allegations sufficiently state a claim for trespass under
Georgia law.
19
C.
Breach of Contract
The Blackburns also allege a state law claim for breach of
contract.
They allege that BAC breached the terms of the note
and security deed.
adequately
BAC contends that the Blackburns have not
pleaded
a
breach
of
contract
claim
because
the
Blackburns have not alleged the existence of a contract between
them and BAC.
It maintains that the note and security deed
were executed between the Blackburns and TB&W, not BAC.
argues that it is merely the servicer of the loan.
BAC
BAC further
contends that even if the Blackburns alleged a contract between
the parties, the Blackburns failed to identify which provisions
of the note and security deed (mortgage) BAC allegedly breached.
To establish a claim for breach of contract under Georgia
law,
a
plaintiff
contract.
App.
must
first
plead
the
existence
of
a
valid
Eastview Healthcare, LLC v. Synertx, Inc., 296 Ga.
393,
398-99,
674
S.E.2d
641,
646
(2009).
After
establishing the existence of a contract, the plaintiff must
also
present
evidence
that
defendant
breached
that
contract.
Id. at 399, 674 S.E.2d at 646.
The Court interprets the Complaint to allege the Blackburns
executed a note and security deed and that loan was assigned to
BAC for servicing.3
The Blackburns allege that BAC then failed
3
The Court observes that if discovery establishes that there was no
assignment, then the Blackburns may have a tort claim against BAC for
negligent servicing of the loan. The Court dismissed that claim above
20
to properly credit payments to their account that were being
made by military allotment.
3d Am. Compl. ¶¶ 15-17.
They
allege BAC took fees from their monthly payments that they did
not owe and refused to credit or return those fees.
58,
60-62,
69-92.
Further,
they
allege
that
Id. ¶¶ 53,
despite
being
current on their loan payments and their efforts to correct the
inaccurate
default
status
of
their
letters threatening foreclosure.
loan,
Id. ¶ 31.
BAC
sent
monthly
Additionally, they
allege that BAC sent inspectors onto their property and made
unreasonable inspections. Id. ¶¶ 34-38.
Consistent with the requirements of notice pleading, the
Blackburns succinctly allege that BAC breached the provisions of
the
note
and
security
deed
regarding
(1)
application
of
payments, (2) permissible fees and charges, (3) notices, and (4)
property inspections.
The Court therefore concludes that the
Third Amended Complaint contains “sufficient factual matter . .
. to state a claim to relief that is plausible on its face.”
Iqbal,
556
Therefore,
U.S.
the
at
Court
678
(internal
denies
BAC’s
quotation
motion
marks
to
omitted).
dismiss
the
Blackburns’ breach of contract claim.
because it concluded that the Blackburns have alleged the assignment
of the loan to BAC and that the duties owed to the Blackburns were
contractual and not in tort.
But, if it turns out that no such
contractual duty exists, then there would no longer be this impediment
to the Blackburns’ tort claim, and the Court would likely reconsider
its ruling on that issue.
21
III. RESPA Claims
The Blackburns allege that BAC failed to comply with the
provisions of RESPA that require a loan servicer to respond to
borrowers’ inquiries and exercise due care in servicing loans.
The Blackburns assert RESPA claims under 12 U.S.C. § 2605(e) and
§ 2605(k).
A.
If
written
3d Am. Compl. ¶ 53-D & M-N.
RESPA Claim Under § 2605(e)
a
borrower
request”
information,
the
sends
seeking
servicer
her
mortgage
account
must
servicer
corrections
acknowledge
a
“qualified
or
receipt
account
of
the
request and respond to the request by correcting the account or
conducting an investigation and providing the borrower with a
written explanation of why the servicer believes the account is
correct.
12 U.S.C. § 2605(e)(1)-(2).
If a servicer fails to
comply with RESPA, the borrower may recover “any actual damages
to the borrower as a result of the failure.”
12 U.S.C. §
2605(f)(1)(A).
The Blackburns base their RESPA claim on a letter they sent
to BAC dated November 29, 2011.
Letter from T. Blackburn to BAC
(Nov. 29, 2011), ECF No. 30-1 at 114.
BAC argues that the
letter does not qualify as a “qualified written request.”
argument is unpersuasive.
That
Under RESPA, a “qualified written
request” is:
22
a written correspondence [that] . . . enables the
servicer to identify, the name and account of the
borrower; and . . . includes a statement of the
reasons for the belief of the borrower, to the extent
applicable, that the account is in error or provides
sufficient detail to the servicer regarding other
information sought by the borrower.
12
U.S.C.
§
2605(e)(1)(B).
The
November
29,
2011
letter
identified the borrowers by name and account number, was sent to
BAC’s
exclusive
office
and
address
for
qualified
written
requests as required by 24 C.F.R. § 3500.21(e)(1), listed the
borrowers’ concerns with fees and charges improperly collected
by
BAC
and
not
credited
to
the
account,
and
requested
information regarding the account, specifically “what amounts
have been credited to [the] account, what they were collected
for in the first place, and why they were collected by [BAC].”
Letter from T. Blackburn to BAC (Nov. 29, 2011), ECF No. 30-1 at
114.
The Court finds that this letter meets the requirements
for a “qualified written request” under § 2605(e)(1)(B).4
BAC also contends
under
§
2605(e)
that the Blackburns do not state a claim
because
the
letter
they
rely
on
as
their
qualified written request was sent to BAC on November 29, 2011,
more than six months after the Blackburns filed their initial
Complaint in this action on April 15, 2011.
BAC
ignores
the
fact
that
after
4
sending
Compl., ECF No. 1.
the
letter,
the
BAC also requests that any RESPA claims based on letters other than
the November 29, 2011 letter be dismissed. Def.’s Am. Mot. to Dismiss
23.
The Court, however, finds that the Blackburns have asserted no
other bases for their RESPA claims. See 3d Am. Compl. ¶ 53.
23
Blackburns
amended
their
Complaint
on
February
27,
2012
to
allege a RESPA § 2605(e) claim based on the November 29, 2011
qualified written request.
3d Am. Compl.
The Court finds no
legal basis for dismissing the claim merely because the letter
on which it relies was sent while other claims were pending in
this action.
It
is
also
clear
that
the
Blackburns
stated a claim for noncompliance with
because
BAC
failed
to
properly
have
sufficiently
§ 2605(e)(2)
respond
to
the
of RESPA
Blackburns’
qualified written request, take appropriate responsive action,
or undertake an investigation into the issues raised by the
letter.
A loan servicer must “acknowledge[e] receipt of the
correspondence within 20 days (excluding legal public holidays,
Saturdays, and Sundays)” and provide the borrower with a written
explanation or clarification responsive to the qualified written
request
within
Saturdays,
and
written request.
“60
days
Sundays)
(excluding
after
the
legal
receipt”
§ 2605(e)(1)(A), (e)(2).
receipt of the November 29, 2011 letter.
public
holidays,
of
qualified
the
BAC did acknowledge
Letter from BAC to T.
Blackburn (Dec. 28, 2009), ECF No. 30-1 at 81.
But, BAC then
sent a letter stating that it had finished researching the issue
of fees due on the account and that it is “unable to waive the
fees in the amount of $15.66.”
Letter from BAC to T. Blackburn
(Dec. 14, 2011), ECF No. 30-1 at 118.
24
This response failed to
fully respond to the November 29, 2011 letter’s requests.
The
Blackburns allege that they received no further response from
BAC.
Moreover, BAC does not assert that it complied with the
response
requirements
of
§
2605(e)(2)
after
receiving
Blackburns’ November 29, 2011 qualified written request.
the
The
remaining arguments made by BAC for dismissal of the Blackburns’
§ 2605(e) claim simply ignore the Third Amended Complaint and
are unpersuasive.
The Blackburns have stated a RESPA claim under § 2605(e),
and thus BAC’s motion to dismiss that claim is denied.
B.
RESPA Claim Under § 2605(k)
The Blackburns also attempt to assert
U.S.C. § 2605(k).
a
claim under 12
As this Court recognized in Bates v. JPMorgan
Chase Bank, N.A., RESPA § 2605(k) is not yet in effect.
See
Bates v. JPMorgan Chase Bank, N.A., No. 4:12-CV-43 (CDL), 2012
WL 3727534, at *4 (M.D. Ga. Aug. 27, 2012).
Accordingly, the
Blackburns cannot base a RESPA claim on § 2605(k), and thus
their RESPA claim under § 2605(k) is dismissed.
CONCLUSION
For the reasons set forth above, the Court grants BAC’s
Motion to Dismiss (ECF No. 33) as to the Blackburns’ state law
claims
that
are
based
on
BAC’s
reporting
of
inaccurate
information to credit bureaus, their intentional and negligent
failure to service loan claims, and their RESPA claim under 12
25
U.S.C. § 2605(k).
The
following claims remain pending: (1)
trespass claim; (2) breach of contract claim; (3) RESPA claim
pursuant to 12 U.S.C. § 2605(e); and (4) conversion claim.
The Court notes that BAC has filed a Motion for Summary
Judgment as to all of the Blackburns’ claims.
The Court will
decide that motion when it becomes ripe.
IT IS SO ORDERED, this 13th day of September, 2012.
S/Clay D. Land
CLAY D. LAND
UNITED STATES DISTRICT JUDGE
26
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