Boone v. Quicken Loans Inc
ORDER AND OPINION granting (88) Motion for Summary Judgment; denying (91) Motion for Summary Judgment; denying as moot (113) Motion in Limine; denying as moot (114) Motion in Limine in case 5:15-cv-04772-JMC; granting (86) Motion for Summary Judgment; denying (89) Motion for Summary Judgment; denying as moot (111) Motion in Limine; denying as moot (112) Motion in Limine in case 5:15-cv-04843-JMC Signed by Honorable J Michelle Childs on 2/9/2018.Associated Cases: 5:15-cv-04772-JMC, 5:15-cv-04843-JMC(asni, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
Quicken Loans, Inc.,
Vance L. Boone,
Quicken Loans, Inc.,
Civil Action No. 5:15-cv-04772-JMC
ORDER AND OPINION
Civil Action No. 5:15-cv-04843-JMC
ORDER AND OPINION
In these consolidated actions, Plaintiffs Thelma Boone and Vance L. Boone (together
“Plaintiffs”) filed the above-captioned actions against Defendant Quicken Loans, Inc.
(“Defendant” or “Quicken Loans”) alleging claims for violation of the South Carolina Attorney
Preference Statute (“SCAPS”), S.C. Code § 37-10-102 (2017), in the context of a mortgage loan
closing. T. Boone v. Quicken Loans, Inc., C/A No. 5:15-cv-04772-JMC, ECF No. 1-1 at 9 ¶¶ 8–
13 (D.S.C. Nov. 30, 2015) (“Boone 1”); V. Boone v. Quicken Loans, Inc., C/A No. 5:15-cv04843-JMC, ECF No. 1-1 at 10 ¶¶ 8–13 (D.S.C. Dec. 4, 2015) (“Boone 2”).
This matter is before the court on Plaintiffs’ and Defendant’s Cross-Motions for
Summary Judgment pursuant to Rule1 56 of the Federal Rules of Civil Procedure. (ECF Nos. 88,
91 (Boone 1); ECF Nos. 86, 89 (Boone 2).)
The parties oppose each other’s Motions
respectively. (ECF No. 100, 105 (Boone 1); ECF Nos. 98, 103 (Boone 2).) For the reasons set
The court observes that from this point forward, “Rule” refers to the Federal Rules of Civil
forth below, the court GRANTS Defendant’s Motion for Summary Judgment and DENIES
Plaintiffs’ Motion for Summary Judgment.
RELEVANT BACKGROUND TO PENDING MOTIONS
Quicken Loans “is a nationwide online mortgage lender that provides, among other
things, residential mortgage loan refinances.” Boone v. Quicken Loans, Inc., 803 S.E.2d 707,
709 (S.C. 2017). “Under the Quicken Loans refinance procedure, the borrowers have already
purchased the property and are simply seeking a new mortgage loan (presumably with more
favorable terms) to replace the existing loan.” Id.
On or about September 13, 2012, Thelma Boone provided information by telephone to
Quicken Loans’ mortgage banker for purposes of completing a loan application to refinance the
mortgage on Plaintiffs’ residence located at 226 River Drive, Rowesville, South Carolina.2 (ECF
No. 88-5 at 3 ¶¶ 4–5 (Boone 1); ECF No. 86-5 at 3 ¶¶ 4–5 (Boone 2).) As a result of the
information provided by Thelma Boone, Quicken Loans generated loan application documents
that were sent to Plaintiffs to review and sign. (Id.) In addition to the loan application package,
Quicken Loans included an Attorney/Insurance Preference Checklist (the “AIPC”). (Id.; see also
ECF No. 1-1 at 13 (Boone 1); ECF No. 1-1 at 14 (Boone 2).) Based on the information provided
by Thelma Boone, Quicken Loans sent Plaintiffs an AIPC that was prepopulated with the
following relevant information (in bold):
Plaintiffs had prior experience with the loan application process having refinanced the mortgage
on their residence a total of nine times: “in 1991 with National Bank of South Carolina; in 1996,
1999, 2001, and 2003 with CPM Federal Credit Union; and in 2011, 2011, 2012, and 2015 with
Quicken Loans.” (ECF No. 88 at 3 (Boone 1); ECF No. 86 at 3 (Boone 2); see also ECF No. 881 at 7 ¶ 11 (Boone 1); ECF No. 86-1 at 7 ¶ 11 (Boone 2).)
I (We) have been informed by the lender that I (we) have a right to select legal counsel to
represent me(us) in all matters of this transaction relating to the closing of this loan.
(a) I select I/We will not use the services of legal counsel.
Borrower Vance L. Boone
Date Borrower Thelma Boone
(b) Having been informed of this right, and having no preference, I asked for assistance
from the lender and was referred to a list of acceptable attorneys. From that list I
Not Applicable _____________________
Not Applicable _____________________
(ECF No. 1-1 at 13 (Boone 1); ECF No. 1-1 at 14 (Boone 2).)
On September 17 and 18, 2012, Plaintiffs signed the loan application documents and the
AIPC. (ECF No. 88-5 at 3 ¶ 6 (Boone 1); ECF No. 86-5 at 3 ¶ 6 (Boone 2).) Plaintiffs then sent
the signed loan application documents to Quicken Loans by telefax on September 17, 2012, and
the AIPC to Quicken Loans on September 19, 2012. (ECF Nos. 1-1 at 13 & 88-7 (Boone 1);
ECF Nos. 1-1 at 14 & 86-7 (Boone 1).) On October 19, 2012, Thelma Boone had a telephone
conversation with a Quicken Loans’ representative to discuss the details of the loan closing,
including who would be in attendance. (ECF No. 88-5 at 3–4 ¶ 7 (Boone 1); ECF No. 86-5 at 3–
4 ¶ 7 (Boone 1).) On October 25, 2012, Plaintiffs met with attorney Justin Tapp of McDonnell &
Associates, P.A. and signed a disclosure form agreeing to the terms of McDonnell & Associates’
representation at the loan closing. (ECF No. 88-8 at 3–4 ¶ 7 (Boone 1); ECF No. 86-8 at 3–4 ¶ 7
(Boone 2).) On October 26, 2012, Plaintiffs completed their loan closing. (ECF No. 88-8 at 3 ¶
4 (Boone 1); ECF No. 86-8 at 3 ¶ 4 (Boone 2).)
On October 15, 2015, Plaintiffs filed Complaints against Quicken Loans in the Court of
Common Pleas for Orangeburg County, South Carolina alleging violation of the SCAPS.3 (ECF
No. 1-1 at 10 ¶ 12 (Boone 1); ECF No. 1-1 at 9 ¶ 12 (Boone 2).) After Quicken Loans removed
the cases to this court (ECF No. 1 (Boone 1); ECF No. 1 (Boone 2)) and they were consolidated
(ECF No. 44 (Boone 1); ECF No. 43 (Boone 2)), the parties engaged in and completed discovery
on March 1, 2017. (ECF No. 54 (Boone 1); ECF No. 53 (Boone 2).) Quicken Loans then moved
for summary judgment on March 31, 2017. (ECF No. 88 (Boone 1); ECF No. 86 (Boone 2).) On
that same day, Plaintiffs filed their Cross-Motions for Summary Judgment. (ECF No. 91 (Boone
1); ECF No. 89 (Boone 2).)
The court heard argument from the parties on the instant Motions at a hearing on
December 5, 2017. (ECF No. 147 (Boone 1); ECF No. 144 (Boone 2).)
The court has jurisdiction over this matter pursuant to 28 U.S.C. § 1332(a)(1) based on
Quicken Loans’ allegations that there is complete diversity of citizenship between Plaintiffs and
Quicken Loans, and the amount in controversy herein exceeds the sum of Seventy-Five
Thousand ($75,000.00) Dollars, exclusive of interest and costs. (ECF No. 1 at 2 (Boone 1); ECF
No. 1 at 2 (Boone 2).) Quicken Loans is a corporation organized under the laws of Michigan
with its principal place of business in Detroit, Michigan. (ECF No. 1-2 at 3 ¶ 5 (Boone 1); ECF
No. 1-2 at 3 ¶ 5 (Boone 2).) Plaintiffs are both citizens and residents of Orangeburg County,
South Carolina. (ECF No. 1-1 at 8 ¶ 1 (Boone 1); ECF No. 1-1 at 9 ¶ 1 (Boone 2).) Moreover,
the court is satisfied that the amount in controversy exceeds $75,000.00 in accordance with
DMTAC’s representation. (ECF No. 1 at 3–7 (Boone 1); ECF No. 1 at 3–7 (Boone 2).)
A plaintiff enforces a violation of the SCAPS through S.C. Code § 37-10-105(A). In addition
to their attorney preference claims, Plaintiffs also alleged their entitlement to relief under S.C.
Code §§ 37-10-105, -108, based on unconscionability. The court dismissed this claim on June
30, 2016. (ECF No. 44 (Boone 1); ECF No. 43 (Boone 2).)
Summary judgment should be granted “if the movant shows that 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 proof of its existence or non-existence would affect the
disposition of the case under the applicable law. Anderson v. Liberty Lobby Inc., 477 U.S. 242,
248–49 (1986). A genuine question of material fact exists where, after reviewing the record as a
whole, the court finds that a reasonable jury could return a verdict for the nonmoving party.
Newport News Holdings Corp. v. Virtual City Vision, 650 F.3d 423, 434 (4th Cir. 2011).
In ruling on a motion for summary judgment, a court must view the evidence in the light
most favorable to the non-moving party. Perini Corp. v. Perini Constr., Inc., 915 F.2d 121, 12324 (4th Cir. 1990). The non-moving party may not oppose a motion for summary judgment with
mere allegations or denial of the movant’s pleading, but instead must “set forth specific facts”
demonstrating a genuine issue for trial. Fed. R. Civ. P. 56(e); see Celotex Corp. v. Catrett, 477
U.S. 317, 324 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986); Shealy v.
Winston, 929 F.2d 1009, 1012 (4th Cir. 1991). All that is required is that “sufficient evidence
supporting the claimed factual dispute be shown to require a jury or judge to resolve the parties’
differing versions of the truth at trial.” Anderson, 477 U.S. at 249.
The Parties’ Arguments
In their respective Motions for Summary Judgment, Plaintiffs assert that Quicken Loans
violates section 37-10-102 by failing “to ascertain the preference of the South Carolina borrower
that results in the attorney at the closing table not being selected by the borrower, a practice that
deprives the South Carolina borrower of a statutorily guaranteed right.” (ECF No. 91-1 at 10
(Boone 1); ECF No. 89-1 at 10–11 (Boone 2).) Specifically, Plaintiffs assert that asking the
question “Will the borrower select legal counsel to represent them in this transaction?” does not
satisfy the statute which “mandates that the creditor ‘…must ascertain prior to closing the
preference of the borrower as to the legal counsel that is employed to represent the debtor in all
matters related to the closing of the transaction . . . .’” (ECF No. 91-1 at 11 (Boone 1); ECF No.
89-1 at 11 (Boone 2).) Quicken Loans “must do more than disclose to the borrower; the lender
must elicit certain specific information from the borrower.” (ECF No. 105 at 5 (Boone 1); ECF
No. 103 at 5 (Boone 2).) In this regard, Quicken Loans’ “form fails to ascertain the preference of
the borrower if it is already prepopulated with ‘I/we will not use the services of legal counsel.’”
(ECF No. 105 at 6 (Boone 1); ECF No. 103 at 6 (Boone 2).) Accordingly, Plaintiffs argue that
Quicken Loans’ form “violates the statute and operates as an illegal waiver of the right to be
represented by any attorney, much less the consumer’s choice of legal counsel.” (ECF No. 91-1
at 16 (Boone 1); ECF No. 89-1 at 16 (Boone 2).)
2. Quicken Loans
In its Motion for Summary Judgment, Quicken Loans asserts that the purpose of the
SCAPS is “to protect borrowers by requiring in the credit application clear and prominent
disclosure of the information necessary to ascertain the borrower’s preference as to the legal
counsel employed to represent the debtor in all matters relating to the closing of the
transaction[.]” (ECF No. 88 at 13 (Boone 1); ECF No. 86 at 13 (Boone 2) (citing Davis v.
NationsCredit Fin. Servs. Corp., 484 S.E.2d 471, 472 (S.C. 1997))). Quicken Loans further
asserts that “a lender substantially complies with section 37-10-102 if the borrower receives a
clear and prominent disclosure of the statutorily required information.” (ECF No. 88 at 14
(Boone 1); ECF No. 86 at 14 (Boone 2) (citing Davis, 484 S.E.2d at 472).) Based on the
foregoing, Quicken Loans argues that it complied with the SCAPS because it “clearly and
prominently disclosed to Plaintiffs that they had the right to express a preference for an attorney
and gave them numerous opportunities to express a preference.”
In support of its
argument, Quicken Loans points out that the AIPC required Plaintiffs to sign acknowledging that
they “have been informed by the lender that I (we) have a right to select legal counsel to
represent me(us) in all matters of this transaction relating to the closing of this loan.” (ECF No.
1-1 at 13 (Boone 1); ECF No. 1-1 at 14 (Boone 2).)
Additionally, Quicken Loans argues that it has satisfied the safe harbor provisions of
section 37-10-102 as to Plaintiffs by providing written notice of the preference information on
the AIPC within one business day. (ECF No. 88 at 21 (Boone 1); ECF No. 86 at 21 (Boone 2).)
The Court’s Review
Plaintiffs bring their actions pursuant to the SCAPS, which provides in pertinent part:
Whenever the primary purpose of a loan that is secured in whole or in part by a
lien on real estate is for a personal, family or household purpose:
(a) The creditor must ascertain prior to closing the preference of the borrower as
to the legal counsel that is employed to represent the debtor in all matters of the
transaction relating to the closing of the transaction . . . .
The creditor may comply with this section by:
(1) including the preference information on or with the credit application so that
this information shall be provided on a form substantially similar to a form
distributed by the administrator; or
(2) providing written notice to the borrower of the preference information with the
notice being delivered or mailed no later than three business days after the
application is received or prepared. If a creditor uses a preference notice form
substantially similar to a form distributed by the administrator, the form is in
compliance with this section.
S.C. Code § 37-10-102(a) (2017). Plaintiffs assert Quicken Loans violated the SCAPS in the
The Attorney/Insurance Preference Form utilized by Quicken is essentially the
form recommended by the Department of Consumer Affairs.4 It is what Quicken
does with the form before it is presented to the borrower that runs afoul of the
law. The pre-populated Attorney/Insurance Preference Form is in and of itself
violative of the very statute that the underlying form is intended to facilitate. By
effectively foreclosing the borrower’s choice when taking the loan application –
the very first step in a real-estate-secured loan transaction–Quicken closes the
door on the consumer and taints the entire process that follows. This alone is
sufficient to warrant a ruling as a matter of law and the entry of summary
(ECF No. 91-1 at 17 (Boone 1); ECF No. 89-1 at 17 (Boone 2).)
Neither Plaintiffs nor Quicken Loans have cited, and the court has not located, a South
Carolina appellate court case addressing this precise issue.5 “Thus, as a federal court sitting in
diversity, the [c]ourt must predict how the South Carolina Supreme Court would decide the
issue.” Allstate Ins. Co. v. Electrolux Home Prods., Inc., C/A No.: 4:16-cv-03666-RBH, 2017
WL 2216298, at *5 (D.S.C. May 19, 2017) (citing Private Mortg. Inv. Servs., Inc. v. Hotel &
Club Assocs., Inc., 296 F.3d 308, 312 (4th Cir. 2002) (“As a federal court sitting in diversity, we
have an obligation to apply the jurisprudence of South Carolina's highest court, the South
Carolina Supreme Court. But in a situation where the South Carolina Supreme Court has spoken
neither directly nor indirectly on the particular issue before us, we are called upon to predict how
that court would rule if presented with the issue.” (internal footnote and citations omitted))). “In
predicting a ruling by the South Carolina Supreme Court, [the Court] may also consider, inter
alia: restatements of the law, treatises, and well considered dicta,” id., “as well as the practices of
other states.” Id. (quoting St. Paul Fire & Marine Ins. Co. v. Am. Int’l Specialty Lines Ins. Co.,
365 F.3d 263, 272 (4th Cir. 2004) (internal quotation marks omitted)). While it does not appear
See Admin. Interpretation No. 10.102(a)-9301 (S.C. Dep’t Consumer Affairs Sept. 7, 1993).
Additionally, neither Plaintiffs nor Quicken Loans has requested certification of this issue to the
South Carolina Supreme Court.
that this specific issue has been addressed by the South Carolina appellate courts, the South
Carolina Supreme Court has reasoned in construing this provision that “[o]ur construction of
legislative intent flows from the clear language of the statute . . .” and that such intent is to
protect borrowers. King v. Am. Gen. Fin., Inc., 687 S.E.2d 321, 325 (S.C. 2009).
The SCAPS requires the lender to ascertain the preference of the borrower as to legal
counsel. “’[A]scertain’ means ‘to render certain or definite . . . to clear of doubt or obscurity . . .
to find out by investigation.’” Parker v. Cty. of Oxford, 224 F. Supp. 2d 292, 295 (D. Me. 2002)
(quoting Black's Law Dictionary 114 (6th ed. 1990)); see also Morgan v. Huntington Ingalls,
Inc., 879 F.3d 602, 609 (5th Cir. 2018) (“’Ascertain’ means ‘to make certain, exact, or precise’
or ‘to find out or learn with certainty. . . ’ [t]hus, ‘ascertain’ requires ‘a greater level of certainty .
. . .’”) (citation omitted). In considering the requirements of the SCAPS, the court observes that
the parties have not presented any dispute of fact regarding Quicken Loan’s attorney preference
procedure in this matter. Therefore, the matter is ripe for summary judgment.
Upon review, the court is persuaded that Quicken Loans did ascertain Plaintiffs’ attorney
preference in compliance with the SCAPS. First, an agent of Quicken Loans expressly asked
Thelma Boone if Plaintiffs will “select legal counsel to represent them in this transaction.”6
After receiving Thelma Boone’s response that Plaintiffs did not have counsel of preference,
Quicken Loans (1) sent Plaintiffs an AIPC that advised them that they “have a right to select
legal counsel to represent [the]m in all matters of this transaction relating to the closing of this
loan” and (2) prepopulated the AIPC with the statement “I/We will not use the services of legal
counsel.” (ECF No. 1-1 at 13 (Boone 1); ECF No. 1-1 at 14 (Boone 2).) Upon their receipt of
Did you [Thelma Boone] express a preference for an attorney?
No. (ECF No. 88-3 at 33:1–3 (Boone 1); ECF No. 86-3 at 33:1–3 (Boone 2).)
the AIPC, Plaintiffs reviewed it, signed it and faxed the document back to Quicken Loans.7
There is no evidence before the court that Plaintiffs had any questions about the content of the
Thereafter, Plaintiffs had approximately five weeks (from September 19, 2012, to
October 25, 2012) before the loan closing on October 26, 2012, to express an attorney preference
to Quicken Loans. Not only did Plaintiffs not do this,8 but Thelma Boone met with counsel
chosen by Quicken Loans (Justin Tapp) the day before the closing and did not voice any
displeasure with his performance.9 In this regard, Plaintiffs’ assertion of no preference is their
preference. Based on the foregoing, the court predicts that the South Carolina Supreme Court
would conclude that Quicken Loans did “ascertain . . . the preference of the borrower as to 
legal counsel . . . relating to the [instant] closing . . .” in compliance with the SCAPS.10
Accordingly, the court GRANTS Quicken Loans’ Motion for Summary Judgment and DENIES
Plaintiffs’ Motion for Summary Judgment.
Upon careful consideration of the entire record and the parties’ arguments, the court
hereby GRANTS Quicken Loans’ Motion for Summary Judgment and DENIES Plaintiffs’
Is that your [Thelma Boone] signature under Item 1?
Did you [Thelma Boone] sign it to confirm that it was correct?
Yes. (ECF No. 88-3 at 33:4–8 (Boone 1); ECF No. 86-3 at 33:4–8 (Boone 2).)
Did you [Thelma Boone] have an attorney that you wanted to close this loan at
No. (Id. at 14–16 (Boone 1); Id. at 14–16 (Boone 2).)
Did you [Vance Boone] express a preference for an attorney to close the loan?
No, sir. (ECF No. 88-2 at 12:6–8 (Boone 1); ECF No. 86-2 at 12:6–8 (Boone 2).)
Did you [Vance Boone] talk to any other attorneys about representing you in the
No, sir. (Id. at 12–14 (Boone 1); Id. at 12–14 (Boone 2).)
Did the attorney [Tapp] who closed the loan do a good job at the closing?
Yes, I guess. (ECF No. 88-3 at 30:9–12 (Boone 1); ECF No. 86-3 at 30:9–12
As a result of this finding, the court will not address whether Quicken Loans has satisfied the
safe harbor provisions of the SCAPS.
Motion for Summary Judgment. T. Boone v. Quicken Loans, Inc., C/A No. 5:15-cv-04772-JMC,
ECF Nos. 88, 91; V. Boone v. Quicken Loans, Inc., C/A No. 5:15-cv-04843-JMC, ECF Nos. 86,
89. As a result of the foregoing, all remaining pending motions are DENIED AS MOOT. T.
Boone v. Quicken Loans, Inc., C/A No. 5:15-cv-04772-JMC, ECF Nos. 113, 114; V. Boone v.
Quicken Loans, Inc., C/A No. 5:15-cv-04843-JMC, ECF Nos. 111, 112.
IT IS SO ORDERED.
United States District Judge
February 9, 2018
Columbia, South Carolina
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?