Taylor v. J P Morgan Chase, Cahse Home Finance

Filing 75

OPINION AND ORDER: The Plaintiff's 68 Objection to Magistrate's Findings, Report and Recommendation, is OVERRULED and the 67 Report and Recommendation is ADOPTED. Accordingly, Defendant's 37 Motion for Judgment on the Pleadings , filed by Defendant, JPMorgan Chase Bank, NA, on 1/4/2017, is GRANTED, and the Clerk is ORDERED to DISMISS all claims against Defendant, Chase, WITH PREJUDICE. Plaintiff's 46 Motion for Judgment on the Pleadings, filed by pro se Plaintiff, Anthony G. Taylor, on 1/27/2017 is DENIED AS MOOT. Signed by Judge Rudy Lozano on 8/30/2017. (Copy mailed to pro se party)(jss)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION AT LAFAYETTE
ANTHONY G. TAYLOR,
Plaintiff,
vs.
JP MORGAN CHASE, CHASE HOME
FINANCE,
Defendant.

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CAUSE NO. 4:16-CV-52

OPINION AND ORDER
This matter is before the Court on the: (1) Report and
Recommendations of Magistrate Judge John E. Martin, filed on June
30,

2017

(DE

#67);

and

(2)

the

Plaintiff’s

Objection

to

Magistrate’s Findings, Report and Recommendation, filed by pro se
Plaintiff, Anthony G. Taylor, on July 14, 2017 (DE #68).

For the

reasons set forth below, the objection (DE #68) is OVERRULED and
the report and recommendation (DE #67) is ADOPTED.
Defendant’s

Motion

for

Judgment

on

the

Accordingly,

Pleadings,

filed

by

Defendant, JPMorgan Chase Bank, N.A., on January 4, 2017 (DE #37),
is GRANTED, and the Clerk is ORDERED to DISMISS all claims against
Defendant, Chase, WITH PREJUDICE.

Plaintiff’s Motion for Judgment

on the Pleadings, filed by pro se Plaintiff, Anthony G. Taylor, on
January 27, 2017 (DE #46), is DENIED AS MOOT.

BACKGROUND
On May 30, 2017, this Court referred Defendant’s motion for
judgment on the pleadings (DE #37) and Plaintiff’s motion for
judgment on the pleadings (DE #46) to Magistrate Judge John Martin
for report and recommendation.

(DE #60.)

On June 30, 2017, Magistrate Judge John Martin issued a Report
and

Recommendation.

(DE

#67.)

First,

Judge

Martin

Plaintiff’s motion to amend the complaint (DE #38).

denied

Judge Martin

also ruled upon Defendant’s motion for judgment on the pleadings
(DE #37), finding that Taylor’s claims fail as a matter of law and
Chase was entitled to judgment on the pleadings.

(DE #67.)

Finally, Judge Martin ruled on Plaintiff’s motion for judgment on
the pleadings (DE #46), recommending it should be denied as moot
because Defendant’s motion for judgment on the pleadings was
successful.

(DE #67.)

The facts of the case are fully set forth

in Judge Martin’s opinion.
Plaintiff filed a timely objection to the Magistrate Judge’s
rulings on July 14, 2017 (DE #68), and Chase filed a response on
July 27, 2017 (DE #69).

As such, this matter if fully briefed and

ripe for adjudication.

DISCUSSION
This Court’s review of the Magistrate Judge’s Report and
Recommendation is governed by 28 U.S.C. § 636(b)(1)(C).

2

When a

party makes objections to a magistrate judge’s recommendations,
“[t]he

district

court

is

required

to

conduct

a

de

novo

determination of those portions of the magistrate judge’s report
and recommendations to which objections have been filed.”
v. Gross, 59 F.3d 668, 671 (7th Cir. 1995).

Goffman

“[T]he court may

accept, reject, or modify, in whole or in part, the findings or
recommendations made by the magistrate judge.”

28 U.S.C. §

636(b)(1)(C); see also Fed. R. Civ. P. 72(b).
First, Plaintiff argues that the Magistrate Judge misapplied
the standard of review for the judgment on the pleadings.
at 3.)

(DE #68

To the contrary, the Magistrate Judge properly evaluated

the motions for judgment on the pleadings under Federal Rule of
Civil Procedure 12(c) under the same standard as a motion to
dismiss for failure to state a claim under Rule 12(b)(6).
A motion for judgment on the pleadings under Rule 12(c) “is
reviewed under the same standard as a motion to dismiss under
12(b); the motion is not granted unless it appears beyond doubt
that the plaintiff can prove no facts sufficient to support his
claim for relief, and the facts in the complaint are viewed in the
light most favorable to the non-moving party.” Flenner v. Sheahan,
107 F.3d 459, 461 (7th Cir. 1997); see also Thomason v. Nachtrieb,
888 F.2d 1202, 1204 (7th Cir. 1989).

In order to survive a Rule

12(b)(6) motion, the complaint “must contain sufficient factual
matter, accepted as true, to ‘state a claim to relief that is
plausible

on

its

face’.”

Ashcroft
3

v.

Iqbal,

556

U.S.

662

(2009)(quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570
(2007)).

All well-pleaded facts must be accepted as true, and all

reasonable inferences from those facts must be resolved in the
plaintiff’s favor.
Cir. 2008).

Pugh v. Tribune Co., 521 F.3d 686, 692 (7th

However, pleadings consisting of no more than mere

conclusions are not entitled to the assumption of truth.
556 U.S. at 678-79.

Iqbal,

This includes legal conclusions couched as

factual allegations, as well as “[t]hreadbare recitals of the
elements of a cause of action, supported by mere conclusory
statements.”

Id. at 678 (citing Twombly, 550 U.S. at 555).

Nevertheless, the court must bear in mind that a pro se complaint
is entitled to liberal construction, “however inartfully pleaded.”
Erickson v. Pardus, 551 U.S. 89, 94 (2007).
Just

because

Plaintiff

included

77

allegations

in

his

complaint does not mean that he has properly pled the parties had
an agreement.

(DE #68 at 4.)

Indeed, the Magistrate Judge

analyzed in detail the breach of contract claim and properly
determined that no contract existed because, inter alia, no offer
was made by Chase to Taylor; Chase never returned an executed copy
of the TPP, and Taylor’s signature on the TPP letter did not bind
Chase to its terms.
Judge

properly

found

(DE #67 at 5-7.)
that

Plaintiff

As such, the Magistrate
could

not

establish

the

elements of a breach of contract claim.
Second, Plaintiff contends the Magistrate Judge misapplied the

4

rationale and holding in Baehl v. Bank of America, N.A., 3:12-cv00029-RLY-WGH, 2013 WL 1319635 (S.D. Ind. Mar. 29, 2013).
at 6.) To the contrary, Baehl is directly on point.

(DE #68

In that case,

like here, the plaintiffs executed and returned a TPP to the bank.
Id. at *2-3.

When the Baehl plaintiffs did not obtain a permanent

loan modification, they sued the bank for, among other claims,
breach of contract.

Id. at *11.

In dismissing the breach of

contract claim, the Baehl court held that the TPP was not an
enforceable contract, because the:
language of the TPP is clear that the TPP was not
an offer by [the bank] to Plaintiffs which
Plaintiffs could accept simply by providing further
documentation. Instead, it was an invitation for
Plaintiffs to apply to the program, which required
Plaintiffs’ compliance to be considered for the
program.
Id. at *12.
Taylor claims Baehl is factually distinguishable because the
plaintiffs

in

that

case

paperwork to the bank.

never

provided

all

of

the

required

While the complaint in this case alleges

that Taylor did submit, repeatedly, all of the necessary documents,
the complaint also includes assertions that Chase sent Taylor
letters on October 3, 2009, October 9, 2009, and December 3, 2009,
informing Taylor that his application was at risk because he had
not submitted the required documents.

(DE #2 at ¶¶ 27, 28, 30.)

The Court in Baehl reasoned that the plaintiff’s reliance on Wigod
was misplaced because:

5

Although the same loan language is present in the
modification here, a critical distinction exists the servicer in Wigod countersigned the Plan and
mailed a copy back to the borrower with a letter
congratulating her on her approval for a trial
modification. Wigod, 673 F.3d at 562. The Court
further explained that these actions “communicated
to [the borrower] that she qualified for HAMP and
would receive a permanent ‘Loan Modification
Agreement’ after the trial period,” provided she
met the listed conditions. Id.
Baehl, 2013 WL 1319635, at *12.

The Baehl court went on to find

that because the bank found the plaintiffs failed to provide
sufficient documentation necessary to complete the modification
review, and denied the application, “no contract was formed.”
at *13.

Id.

Taking Plaintiff’s allegations as true, as the Court must

at this stage of the proceedings, that he did provide all of the
necessary documentation, the Magistrate Judge still properly found
that there was no enforceable contract as “Chase never returned an
executed copy of the TPP, and Taylor’s signature on the TPP letter
did not bind Chase to its terms.”

(DE #67 at 7.)

In this case, like in Baehl, the language of the TPP is clear
that it is not an offer that Taylor could have accepted simply by
providing
language

further
in

the

documentation.
TPP

that

“if

you

Moreover,
qualify

the

under

conditional
the

federal

government’s Home Affordable modification program and comply with
the terms of the Trial Period Plan, we will modify your mortgage
loan and you can avoid foreclosure” (DE #2 at 14) and “[i]f prior
to the Modification Effective date, (i) the Lender does not provide

6

me

a

fully

executed

copy

of

this

Plan

and

the

Modification

Agreement; (ii) I have not made the Trial Period payments required
under Section 2 of this Plan; or (iii) the Lender determines that
my representations in Section 1 are no longer true and correct, the
Loan Documents will not be modified and this Plan will terminate”
(DE #2 at 20) and “the Trial Period Plan is the first step.

Once

we are able to confirm your income and eligibility for the program,
we will finalize your modified loan terms and send you a loan
modification agreement . . . “ (DE #2 at 16) shows, like in Baehl,
that the TPP was not an offer that Plaintiff could accept simply by
providing further documentation.
Taylor

also

contends

the

Magistrate

failed

to

follow

controlling precedent in Wigod v. Wells Fargo Bank, N.A., 673 F.3d
547, 563 (7th Cir. 2012).

(DE #68 at 7-9.)

The Magistrate Judge

did address this case in his opinion, noting it was dissimilar
because in Wigod, the court found there was a breach of contract
claim where the bank countersigned the TPP Agreement and mailed a
copy back to the Plaintiff “with a letter congratulating her on her
approval for a trial modification.

In so doing, [the bank]

communicated to Wigod that she qualified for HAMP and would receive
a permanent ‘Loan Modification Agreement’ after the trial period.”
Wigod, 673 F.3d at 562. In contrast, here, Plaintiff does not
allege that Chase ever returned a countersigned TPP to Plaintiff.

7

The Court in Golbeck v. Johnson Blumberg & Assocs., LLC., No. 16cv-6788,

2017

WL

3070868,

at

*7

(N.D.

Ill.

July

19,

2017)

(citations omitted), recently similarly distinguished Wigod:
But Wigod is no help to Plaintiff because the
defendant in Wigod “countersigned” the trial
payment plan “and mailed a copy to [plaintiff] with
a letter congratulating her on her approval for a
trial modification.” Wigod, 673 F.3d at 562. The
Seventh Circuit explained that “when [defendant]
executed the [trial period plan or ‘TPP’], its
terms included a unilateral offer to modify
[plaintiff's] loan conditioned on her compliance
with the stated terms of the bargain.” Id. Thus,
it was the lender's signature that made the TPP a
binding offer that could be accepted through
performance. That is because “when the promisor
conditions a promise on his own future action or
approval, there is no binding offer,” but “when the
promise is conditioned on the performance of some
act by the promisee or a third party, there can be
a valid offer.” Id. at 561.
In finding no contract was formed in that case where the bank did
not sign the contract and return it, the Golbeck court went on to
note that other courts around the country are in accord.

See,

e.g., Pennington v. HSBC Bank USA, N.A., 493 Fed. Appx. 548, 554
(5th Cir. 2012) (“[Plaintiff’s] contract contained the . . .
language . . . that the TPP does not take effect until the borrower
and the lender sign it and the lender provides the borrower a
signed copy. . . . [Plaintiffs’] made regular TPP payments, but
they neither produced such a signed contract nor allege such a
signed contract exists. . . . The complaint therefore does not
demonstrate that the [Plaintiffs’] TPP ever took effect, so there
8

could be no contract for the bank to breach.”); McGann v. PNC Bank,
Nat. Ass’n, No. 11-cv-06894, 2013 WL 1337204, at *6 (N.D. Ill. Mar.
29, 2013) (“Here, the plain language of the TPP Agreement states
[defendant] is not obligated to provide a HAMP loan modification
until both parties execute the TPP Agreement . . . Pursuant to the
TPP Agreement’s own terms, [defendant’s] failure to sign the
agreement evidences that it had no obligation to offer [plaintiff]
a HAMP loan modification.”); Avevedo v. CitiMortgage, Inc., No. 11
C 4877, 2012 WL 3134222, at *8 (N.D. Ill. July 25, 2012) (“The
court agrees with [defendant] that the fact that it did not execute
the TTP associated with the plaintiffs’ loan and return that
document to them is fatal to the plaintiffs’ breach of contract
claim.”); Rummell v. Vantium Capital, Inc., No. 12-10952, 2012 WL
2564846, at *6 (E.D. Mich. July 2, 2012) (“[T]he TPP is only a
proposal, and it does not create a binding contract when only one
party has signed it.”); Lonberg v. Freddie Mac, 776 F.Supp.2d 1202,
1209 (D. Or. 2011) (“[E]very court that has reviewed this issue has
unanimously

agreed

that

a

defendant’s

failure

to

provide

a

permanent loan modification solely on the basis of the existence of
a TPP does not sufficiently state a breach of contract claim.”).
This Court concurs with the logic in Golbeck and the cases
cited therein, finding that because Chase was required to execute
the TPP but did not, no contract was formed.
no viable breach of contract claim.

9

Therefore, there is

See, e.g., Senter v. JPMorgan

Chase Bank, N.A., 810 F.Supp.2d 1339, 1357 (S.D. Fla. 2011)
(holding “the TPP Agreements are not agreements to provide the
Plaintiffs

with

a

loan

at

a

specified

date,

but

rather,

an

agreement governing obligations of both the Plaintiffs and the
Defendants over a trial period after which the Defendants may
extend a separate permanent loan modification should they determine
that the Plaintiffs qualify.”); Bourdelais v. JPMorgan Chase Bank,
N.A., No. 3:10 cv 670-HEH, 2011 WL 1306311, at *5 (E.D. Va. Apr. 1,
2011).
While it is true that the dicta in Wigod states that a reading
that the obligation to send a permanent Modification Agreement only
if and when it actually sent one would render the agreement
illusory, it also noted that a more natural interpretation would be
to read it that the bank had an “obligation to offer Wigod a
permanent modification once she satisfied all her obligations under
the agreement.”

Wigod, 673 F.3d at 563 (emphasis in original). In

that case, “[o]nce [the bank] signed the TPP Agreement and returned
it to Wigod, an objectively reasonable person would construe it as
an offer to provide a permanent modification agreement if she
fulfilled its conditions.”

Id.

In this case, because Chase never

signed and returned the agreement, there was no offer, and no
contract was ever created.
Next, Taylor contends the Magistrate Judge’s finding “that
Chase did not agree to a timely decision is erroneous and contrary”

10

to law. (DE #68 at 10-12.) However, the Magistrate Judge properly
determined that the express language of the TPP document does not
specify the exact timing of the modification decision.

(DE #67 at

7.) The TPP provides that, “[i]t may take up to 30 days for us to
receive

and

review

your

documents.

We

will

process

your

modification request as quickly as possible. Please note, however,
that your modification will not be effective unless you meet all of
the applicable conditions.”

Id.

The TPP does not promise a

decision within 30 days, or that Taylor would receive any documents
relating to the decision prior to the Modification Effective Date.
As such, this case is different than Wigod, where a counter-signed
TPP

was

returned

to

Plaintiff,

and

it

is

also

factually

distinguishable from the other non-controlling cases from other
circuits cited by Taylor.

See Young v. Wells Fargo Bank, N.A., 717

F.3d 224, 228-35 (1st Cir. 2013) (holding mortgagor stated a claim
under Massachusetts contract law where Plaintiff was incorrectly
sent a denial letter, then eventually received a permanent loan
modification, but for a higher payment); Corvello v. Wells Fargo
Bank, N.A., 728 F.3d 878, 882 (9th Cir. 2013) (the bank never told
the plaintiffs they were ineligible for a modification), West v.
JPMorgan Chase Bank, N.A., 214 Cal. App. 4th 780 (4th Dist. 2013)
(the defendant agreed there was a contract and the only issue was
whether it was breached).

In contrast, in this case, the parties

dispute whether a contract was made, and Chase did ultimately tell

11

Taylor he

did not satisfy the income requirements for a HAMP loan

modification, resulting in a denial of his modification request.
(DE #34-5.)
Taylor also argues that the Magistrate Judge’s finding that he
failed to state a claim for breach of the implied covenant of good
faith and fair dealing is erroneous. (DE #68 at 12-13.)

However,

Taylor does not contest the well settled law cited by Magistrate
Judge Martin that there is no separate cause of action in this case
for breach of an implied covenant of good faith and fair dealing:
the alleged contract is not for sale of goods, governed by the
Uniform Commercial Code, it does not involve a contract for
insurance, and no fiduciary or other special relationship is
created by a mortgage.

Baehl, 2013 WL 1319635, at *9; see also Ray

Skillman Oldsmobile & GMC Truck, Inc. v. Gen. Motors Corp., No.
1:05-CV-0204-DFH-WTL, 2006 WL 694561, at *6 (S.D. Ind. Mar. 14,
2006) (“Neither Indiana nor Michigan recognizes an independent tort
action for breach of an implied contractual covenant of good
faith.”).

Taylor’s insistence that he included allegations in his

complaint in paragraphs 20-32 to allege this cause of action (DE
#68 at 13) does not save these claims as they are not recognized as
an independent tort.
Taylor next contends the Magistrate Judge’s finding that
“Chase only mishandled the HAMP process is erroneous.”

(DE #67 at

9; DE #68 at 13.) This misconstrues the Magistrate Judge’s proper

12

finding, which was in finding the proposed amendment futile for
intentional and negligent infliction of emotional distress, he
noted that even if Chase had mishandled the process, that would
still not give rise to the necessary level of being atrocious and
utterly intolerable for these claims. See Jaffri v. JPMorgan Chase
Bank, N.A., 26 N.E.3d 635, 640 (Ind. Ct. App. 2015).
Finally, Taylor argues the Magistrate Judge’s finding is
erroneous in recommending the denial of Plaintiff’s motion for
judgment on the pleadings as moot.

(DE #68 at 14.)

The parties

disagree as to what statute of limitations is applicable for the
breach of contract and promissory estoppel claims.

However,

because the Magistrate Judge properly found that Taylor has not
stated a claim for breach of contract or promissory estoppel, and
amendment of the claims would be futile, the questions of whether
Taylor

brought

his

claims

within

the

applicable

statute

of

limitations is moot.

CONCLUSION
For the reasons set forth below, the objection (DE #68) is
OVERRULED and the report and recommendation (DE #67) is ADOPTED.
Accordingly, Defendant’s Motion for Judgment on the Pleadings,
filed by Defendant, JPMorgan Chase Bank, N.A., on January 4, 2017
(DE #37), is GRANTED, and the Clerk is ORDERED to DISMISS all
claims against Defendant, Chase, WITH PREJUDICE.

13

Plaintiff’s

Motion for Judgment on the Pleadings, filed by pro se Plaintiff,
Anthony G. Taylor, on January 27, 2017 (DE #46), is DENIED AS MOOT.

DATED: August 30, 2017

/s/ RUDY LOZANO, Judge
United States District Court

14