Messa v. CitiMortgage,Inc. et al
Filing
20
MEMORANDUM OPINION AND ORDER granting 18 MOTION for Summary Judgment and Brief in Support. (Signed by Judge Sim Lake) Parties notified. (aboyd)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
JODETTE MESSA,
Plaintiff,
CITIMORTGAGE, INC.; HUGHES,
WATTERS & ASKANASE, L .L .P . ;
and FEDERAL HOME LOAN
MORTGAGE CORPORATION,
Defendants.
§
§
§
§
§
§
§
§
§
§
§
§
CIVIL ACTION NO. H-12-0484
MEMORANDUM OPINION AND ORDER
Defendants CitiMortgage, Inc. ("Citi") and Federal Home Loan
Mortgage Corporation ("Freddie Mac") (collectively, "Defendants")
removed this action from the 55th Judicial District Court of
Harris
§
County, Texas.'
1452(f) and 28 U.S.C.
Jurisdiction
§
1367 (a).'
is based
on
12 U.S.C.
Pending before the court is
Defendants' Motion for Final Summary Judgment and Brief in Support
("Defendantsr Motion for Summary Judgment") (Docket Entry No. 18).
'~efendant Hughes, Watters & Askanase, L.L.P.
("HWA")
consented to the removal.
(Defendant HWA's Consent to Removal,
Docket Entry No. 4) The court dismissed all claims against HWA
without prejudice on September 18, 2012. (Order on Stipulation of
Dismissal, Docket Entry No. 17)
'~otice of Removal, Docket Entry No. 1, ¶ 11. Section 1452 (f)
provides that "all civil actions to which [Freddie Mac] is a party
shall be deemed to arise under the laws of the United States, and
the district courts of the United States shall have original
The court exercises supplejurisdiction of all such actions.
mental jurisdiction over all other claims in this action pursuant
to § 1367 (a).
"
Having reviewed the arguments, summary judgment evidence, and
relevant law, the court is persuaded that the motion should be
granted.
I.
Backaround
In May of 2002 plaintiff Jodette Messa took out a mortgage to
finance the purchase of a home in Houston, T e ~ a s . Citi serviced
~
the loan.4 Messa alleges that after defaulting on her obligations
to Citi she sought a loan modification pursuant to the federal
government's
Home Affordable Mortgage Program ("HAMP") .
Messa
alleges that under the Freddie Mac Single-Family Seller/Servicer
Guide (the "Guide") and the Making Home Affordable Handbook (the
"Handbook") Citi was also required to offer various other options
prior to foreclosure, including standard modification and the
alternatives described in the federal government's Home Affordable
Foreclosure Alternatives
("HAFA") program.
Messa alleges that
3~laintif s First Amended Petition and Applications for
f
Temporary Restraining Order and Temporary Injunction ("Amended
Petition"), Ex. B.3 to Notice of Removal, Docket Entry No. 1-4,
YI 10; Defendants' Motion for Summary Judgment, Docket Entry No. 18,
p. 4. Messa executed a note, see Note, Ex. A.l to Defendants'
Motion for Summary Judgment, Docket Entry No. 18-3, and a deed of
trust, see Deed of Trust, Ex. A.2 to Defendants' Motion for Summary
Judgment, Docket Entry No. 18-4, to secure the financing.
4~mended
Petition, Ex. B.3 to Notice of Removal, Docket Entry
No. 1-4, ¶ 3; Defendantsf Motion for Summary Judgment, Docket Entry
No. 18, p . 2.
5~mended
Petition, Ex. B.3 to Notice of Removal, Docket Entry
NO. 1-4, ¶ 20.
Citi
ultimately
option:
presented
her
with
only
payment of the full amount owed.7
one
default-curing
Messafs default was
never cured, and Freddie Mac purchased the home at a foreclosure
sale on November 1, 2011.*
Messa filed her Amended Petition on January 1, 2012, asserting
causes of action for breach of contract and violations of the Texas
Finance Code.'
In the breach of contract claim Messa alleges that
the parties' contract -- i.e., the Deed of Trust -- required Citi
to provide a notice of default, specific actions that Messa could
take to cure the default, and at least 30 days to allow Messa to
complete those actions.1° Messa alleges that Citi breached those
terms by failing to give her the opportunity to pursue options
under either the Guide or the Handbook and by foreclosing during
the pendency of her HAMP application.ll
Messa brings claims under three separate provisions of the
Texas Finance Code. Messa alleges that Citi violated TEX. FIN. CODE
'substitute Trustee's Deed, Ex. C to Defendantsr Motion for
Summary Judgment, Docket Entry No. 18-8.
'Amended Petition, Ex. B.3 to Notice of Removal, Docket Entry
No. 1-4, ¶ ¶ 25-34. Messa also asserts defenses to acceleration and
sale, seeks the equitable remedy of quiet title, and requests a
declaratory judgment to set aside the acceleration and sale.
Id.
- mm 35-44.
§
392.301 (a)(8), which prohibits a debt collector from threatening
to take an action prohibited by law, by threatening to take action
to foreclose on the home in contravention of the terms of the Deed
of Trust and the Handbook.12
Messa further alleges that Citi
misrepresented the character, extent, and amount of the debt in
violation of TEX. FIN. CODE
§
392.304 (a)(8) and employed false
representations or deceptive means to collect a debt in violation
of TEX. FIN. CODE § 392.304 (a)(19). I 3
Defendants
filed
their
motion
for
summary
judgment
on
October 12, 2012, arguing that as a matter of law any alleged
breaches of the Guide, the Handbook, or the federal HAMP and HAFA
programs may not form the basis of either a breach of contract or
Texas Finance Code action.14
As to Messars Texas Finance Code
claims, Defendants argue that there is no evidence that Citi ever
threatened to take an action prohibited by
law or that Citi
misrepresented the debt in any way.15 Messa responded, contending
that genuine issues of material fact preclude a grant of summary
judgment .l6
14~efendantsr Motion
No. 18, pp. 7-10.
for
Summary
Judgment,
Docket
Entry
16plaintiffr Response to Defendant' s Motion for Summary
s
Judgment ("Messars Response"), Docket Entry No. 19, pp. 4-10.
11.
Summarv Judament Standard
Rule 56 of the Federal Rules of Civil Procedure mandates
summary judgment "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 party
moving for summary judgment "bears the burden of identifying those
portions of the record it believes demonstrate the absence of a
genuine issue of material fact."
Lincoln Gen. Ins. Co. v. Revna,
401 F.3d 347, 349 (5th Cir. 2005).
Where, as here, the nonmoving
party bears the burden of proof at trial, the moving party may
satisfy its burden by "'showingr -- that is, pointing out to the
district court -- that there is an absence of evidence to support
the nonmoving party's case."
Celotex Corp. v. Catrett, 106 S. Ct.
2548, 2554 (1986). Rule 56 does not require the movant to negate
the elements of the nonmovantrs case.
Boudreaux v. Swift Transp.
C . 402 F.3d 536, 540 (5th Cir. 2005).
o,
Once the movant has carried this burden, the nonmovant must
show that specific facts exist over which there is a genuine issue
for trial.
Revna, 401 F.3d at 349 (citing Celotex, 106 S. Ct. at
2553-54). The nonmovant may not rest upon mere allegations in the
pleadings to make such a showing.
Revna, 401 F.3d at 350.
To
create a genuine fact issue, more than some "metaphysical doubt as
to the material facts" is required.
Matsushita Elec. Indus. Co.,
Ltd. v. Zenith Radio C O ~ P . ,106 S. Ct. 1348, 1356 (1986).
The parties may support the existence or nonexistence of a
genuine fact issue by either (1) citing to particular parts of the
record, including depositions, documents, electronically stored
information, affidavits or declarations, admissions, and interrogatory answers, or
(2) showing that the materials cited do not
establish the absence or presence of a genuine dispute or that an
adverse party cannot produce admissible evidence to support the
fact. Fed. R. Civ. P. 56 (c)(1)(A) (B).
In reviewing this evidence
"the court must draw all reasonable inferences in favor of the
nonmoving party, and it may not make credibility determinations or
weigh the evidence."
Reeves v . Sanderson Plumbins Prods., Inc . ,
120 S. Ct. 2097, 2110 (2000).
111.
Analysis
As plaintiff, Messa bears the burden of proof on her claims.
To carry their summary judgment burden Defendants must therefore
show that there is an absence of evidence to support those claims.
See Celotex, 106 S. Ct. at 2554.
A.
Breach o f Contract
To prevail on a breach of contract claim the plaintiff must
prove that (1) a valid contract exists; (2) the plaintiff fully
performed her obligations; (3) the defendant breached the contract;
and
(4) the plaintiff was damaged as a result of the breach.
Hovorka v. Communitv Health Svs., Inc., 262 S.W.3d 503, 508-09
(Tex. App. -- El Paso 2008, no pet.).
-6-
Messa alleges that Citi
breached t h e
Deed o f
Trust
i n two ways:
(1) C i t i
foreclosed
without o f f e r i n g e i t h e r a standard modification pursuant t o t h e
G u i d e o r a HAFA a l t e r n a t i v e p u r s u a n t t o t h e Handbook; a n d ( 2 ) C i t i
foreclosed
while
modification.
"I7
"supposedly
evaluating
her
for
a
HAMP
Defendants a r g u e t h a t t h e r e i s no evidence t h a t
s u c h c o n d u c t c o n s t i t u t e s a b r e a c h o f t h e Deed o f T r u s t . ' *
The Deed o f T r u s t p r o v i d e s i n r e l e v a n t p a r t :
Lender
s h a l l give notice
t o Borrower p r i o r
to
a c c e l e r a t i o n f o l l o w i n g Borrower's breach of any covenant
o r agreement i n t h i s S e c u r i t y Instrument . . . . The
notice s h a l l specify:
( a ) t h e d e f a u l t ; (b) t h e a c t i o n
r e q u i r e d t o c u r e t h e d e f a u l t ; (c) a d a t e , n o t less t h a n
30 days from t h e d a t e t h e n o t i c e i s given t o Borrower, by
which t h e d e f a u l t must b e cured; and (d) t h a t f a i l u r e t o
c u r e t h e d e f a u l t on o r b e f o r e t h e d a t e s p e c i f i e d i n t h e
n o t i c e w i l l r e s u l t i n a c c e l e r a t i o n of t h e sums s e c u r e d by
t h i s S e c u r i t y Instrument and s a l e of t h e P r o p e r t y . l g
D e f e n d a n t s h a v e p r o v i d e d c o m p e t e n t summary judgment e v i d e n c e t h a t
on J u l y 29,
2011, C i t i s e n t a n o t i c e t o Messa t o i n f o r m h e r t h a t
the loan w a s i n default."
The N o t i c e o f D e f a u l t s t a t e d t h a t , t o
c u r e t h e d e f a u l t , Messa was r e q u i r e d t o p a y t h e f u l l amount p a s t
NO.
l 7 ~ r n e n d e d e t i t i o n , Ex. B . 3 t o N o t i c e o f Removal, Docket E n t r y
P
1 - 4 , ¶ ¶ 27-28.
1 8 ~ e f d a n t s ' M o t i o n f o r Summary J u d g m e n t , D o c k e t E n t r y No. 1 8 ,
en
p p . 7-10.
I g ~ e e d f T r u s t , Ex. A.2 t o D e f e n d a n t s f M o t i o n f o r Summary
o
J u d g m e n t , D o c k e t E n t r y No. 18-4, ¶ 22.
'O~etter from C o l l e c t i o n Department, C i t i M o r t g a g e , I n c . t o
J o d e t t e Messa ( " N o t i c e o f D e f a u l t " ) , Ex. A . 3 t o D e f e n d a n t s ' Motion
f o r Summary J u d g m e n t , Docket E n t r y No. 18-5.
due, plus delinquency related expenses, by September 1, 2011 .21 The
notice stated that failure to cure the default would result in
acceleration of the loan and sale of the property."
Messa does not
dispute receipt of this notice, nor does she dispute its contents.
Citi therefore complied with the relevant terms of the Deed of
Trust.
Messa has presented no evidence to support her allegation that
Citi breached the Deed of Trust by failing to comply with the Guide
or the Handbook. No obligation to offer a standard modification or
a HAFA alternative existed within the Deed of Trust.
Moreover,
Messa is neither a party nor a third-party beneficiary to any
contract that
Similarly,
includes
Messa
has
the
Guide
presented
or
no
the
Handbook
evidence
to
as
terms.
support
her
allegation that Citi was in breach when it foreclosed on the home
during the pendency of the application for HAMP modification.
Messa has presented evidence that Citi did allow her to pursue such
a m ~ d i f i c a t i o n , ~ ~ argues that Citi was required to provide her
and
"with at least 30 days to take advantage of [that] option" prior to
fore~losing.'~ But nothing in the Deed of Trust creates such an
23~ffidavit Support of Plaintiff's Response to Defendants'
in
Motion for Summary Judgment, Ex. A to Messa's Response, Docket
Entry No. 19-1, ¶ 3.
24~essa's
Response, Docket Entry No. 19, p. 8.
-8-
obligation -- the 30-day term in the Deed of Trust applies to "the
action required to cure the default."
The Notice of Default
clearly provides that the only action required to cure the default
was the payment of the outstanding amount owed. Messa has provided
no
evidence
that
Citi
informed
her
that
pursuing
the
HAMP
modification would cure the default. The court therefore concludes
that Defendants have satisfied their burden to point out the
absence of evidence to support Messa's breach of contract claim,
and that Messa has failed to identify specific facts over which
there is a genuine issue for trial.
B.
Texas Finance Code
Messa asserts claims against Citi for violations of TEX. FIN.
CODE S 5 392.301(a) (8) (threatening to take an action prohibited by
law), 392.304 (a)(8) (misrepresenting the character, extent, or
amount of
a
consumer debt), and
392.304 (a)(19) (using false
representations or deceptive means to collect a consumer debt).25
In support of her claim under
§
392.301(a) (8) Messa alleges that
Citi threatened to foreclose -- and did in fact foreclose -without properly considering her for HAMP modification or other
options pursuant to the andb book.'^ The court has already concluded
that the Deed of Trust did not obligate Citi to consider Messa for
25~mended
Petition, Ex. B.3 to Notice of Removal, Docket Entry
NO. 1-4, ¶ ¶ 30-33.
261d. 31; Messaf s Response, Docket Entry No. 19, p. 9.
¶
a HAMP modification or any of the other Handbook options. Failure
to consider Messa for those programs therefore would not have
rendered a foreclosure action illegal. Furthermore, Messa does not
argue that the Handbook or the HAMP guidelines constitute governing
law such that a violation thereof would be
§
actionable under
392.301 (a)(8).
In support of her claim under 5 392.304 (a)(8) Messa alleges in
the Amended Petition that Citi refused to account for the total
u.'
amounts d e '
Defendants argue that any evidence of such a refusal
-- or how such a refusal could constitute a misrepresentation under
§
392.304 (a)(8) -- is absent from the summary judgment record.28
Messa provides no
response.
under
§
evidence in support of
this claim in her
Messa argues that a fact issue exists as to her claim
392.304 (a)(19), however, because "Citi represented to
Plaintiff that she could still submit her HAMP application and be
approved, when they had no intention to stay good on that word."29
This argument has no merit. Messa provides no evidence in support
of the allegation that this representation was either false or
deceptive.
Moreover, Messa has not cited any authority to show
that such a representation, if true, would constitute a violation
27~mended
Petition, Ex. B.3 to Notice of Removal, Docket Entry
NO. 1-4, ¶ 33.
-
28~efendants'
Motion for Summary Judgment, Docket Entry No. 18,
1 1
29~essa's
Response, Docket Entry No. 19, p. 9.
of
§
392.304 (a)(19).
- Thomas v. EMC Mortqase Corp., 499
See
F. Appfx 337, 343 (5th Cir. 2012) (finding that a "failure to
modify [a] loan as promised" did not create a genuine issue of
material fact as to a claim under 5 392.304(a) (19)).
The court
therefore concludes that there are no genuine issues of material
fact as to the Texas Finance Code claims.30
IV.
Conclusion and Order
Defendants have shown that there is an absence of evidence to
support Messafs causes of action for violations of the Texas
Finance Code and breach of contract. No genuine issues of material
fact exist in this case.
when
drawing
all
The court therefore concludes that, even
reasonable
inferences
in
favor
of
Messa,
Defendants are entitled to judgment as a matter of law on all
claims. Accordingly, Defendantsf Motion for Final Summary Judgment
(Docket Entry No. 18) is GRANTED.
SIGNED at Houston, Texas, on this the 22nd day of May, 2013.
f
SIM LAKE
UNITED STATES DISTRICT JUDGE
30~ecause
the court has concluded that no genuine issue of
material fact exists as to the breach of contract and Texas Finance
Code claims, no basis remains for the equitable and declaratory
relief requested in the Amended Petition. Defendants are therefore
entitled to summary judgment on the quiet title and declaratory
judgment actions.
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?