Betancourt v. Deutsche Bank National Trust Company

Filing 25

ORDER DENYING re 21 MOTION to Strike 19 Response to Motion,, Objections to and Motion to Strike Portions of the Affidavit of Jerry Betancourt filed by Deutsche Bank National Trust Company, GRANTING 17 MOTION for Summary Judg ment and Motion for Judgment Based on the Pleadings MOTION for Judgment on the Pleadings filed by Deutsche Bank National Trust Company, Plaintiffs claims are hereby DISMISSED WITH PREJUDICE. The Clerk is directed to issue a Judgment in favor of Defendant and that Plaintiff takes nothing on his claims. Signed by Judge Xavier Rodriguez. (wg)

UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF TEXAS
SAN ANTONIO DIVISION
JERRY BETANCOURT,
Plaintiff,
v.
DEUTSCHE BANK NATIONAL TRUST
COMPANY,
Defendant.

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Civil Action No. SA-17-CV-1176-XR

ORDER
On this date, the Court considered the status of the above captioned-case. After careful
consideration, the Court DENIES Defendant’s Motion to Strike (Docket no. 21) and GRANTS
Defendant’s Motion for Summary Judgment and Judgment on the Pleadings (Docket no. 17).
BACKGROUND
On November 17, 2017, Defendant Deutsche Bank National Trust Company removed
this action from the 150th Judicial District Court of Bexar County, Texas pursuant to 28 U.S.C
§ 1332. Docket no. 1. Plaintiff Jerry Betancourt filed this action to prevent the foreclosure of his
property located at 2043 West Mulberry, San Antonio, Texas (the “Property”). Docket no. 1-4.
Plaintiff filed an Amended Complaint on March 1, 2018. Docket no. 10.
Plaintiff and his wife purchased the Property in February 1987. On September 17, 1998,
Plaintiff executed a $70,200 Texas Home Equity Note (the “Note”) in favor of lender United
Companies Lending Corporation and its assigns. Docket no. 17-1. Plaintiff states that this Note
resulted from refinancing an earlier debt. Docket no. 10 at 2–3. On the same date, Plaintiff

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executed a Texas Home Equity Security Instrument (“Deed of Trust”) that was recorded and
established a first lien on the Property. Docket no. 17-2.
Plaintiff executed a Loan Modification Agreement that became effective on April 23,
2007, relating to the Note. Docket no. 17-3. Defendant, successor-in-interest of the Note and
Deed of Trust, alleges that Plaintiff breached this agreement due to non-payment. Defendant then
filed a lawsuit seeking foreclosure on the Property in state court. The parties were ordered to
mediation and entered into a mediation agreement, which required Plaintiff to provide Defendant
with certain documents. Under the mediation agreement, the parties agreed to the following:
a. On or before March 9, 2016, [Plaintiff] will provide [Defendant] with all
documents necessary to comply with [Defendant’s] loan modification
requirements pursuant [to Defendant’s] letter to [Plaintiff] dated February 8,
2016. If [Plaintiff] fails to provide [Defendant] with all documents necessary
for the consideration of the loan modification on or before March 9, 2016,
[Defendant] may set its Rule 736 hearing with proper notice.
b. On or before March 9, 2016, [Defendant] will provide to [Plaintiff’s] counsel
the amount necessary for loan reinstatement.
c. If [Plaintiff] is not approved for a loan modification for the subject Property,
[Plaintiff] will have five (5) days from receipt of the denial of the
modification to seek other loss mitigation options.
d. After the expiration of the five (5) days as set forth in subpara. c herein,
[Defendant] may, at its discretion, set its Rule 736 hearing upon proper notice.
Docket no. 17-4.
Plaintiff asserts that, under the agreement, Defendant was required to provide him a yes
or no decision on a loan modification prior to setting any foreclosure hearing. Plaintiff alleges he
received no decision from Defendant, which violated the agreement. Defendant, on the other
hand, asserts Plaintiff failed to comply with the agreement by not providing all required
documents, and that Plaintiff did not qualify for or receive any offers for another loan
modification agreement.
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On March 8, 2017, an order was entered in state court allowing Defendant to foreclose on
the Property, and a foreclosure sale was scheduled for November 7, 2017. Plaintiff filed this case
to prevent the foreclosure, and he brings claims against Defendant for breach of contract,
violation of the Texas Fair Debt Collection Practices Act (“TDCA”), and declaratory judgment.
Docket no. 10 at 5–8. On May 25, 2018, Defendant filed its motion for summary judgment and
judgment on the pleadings, arguing all of Plaintiff’s claims fail. Plaintiff filed a response, and
Defendant filed a reply. On June 26, 2018, Defendant filed a motion to strike portions of an
affidavit Plaintiff attached to his response to the motion for summary judgment. Docket no. 21.
ANALYSIS
I.

Defendant’s Motion to Strike
Defendant asks the Court to strike portions of Plaintiff’s affidavit that he attached to his

response to Defendant’s motion for summary judgment. Defendant objects to Plaintiff’s
statements that he complied with the mediation agreement and that Defendant violated the
agreement, specifically:
As the Court can see from Exhibits 5, 6 & 8 attached to this response show that
we complied with our part of the agreement.
[T]his is a direct violation of the Mediated Settlement Agreement.
Now, because the Defendants breach of our agreement, I will be required to pay
$23,000 more to modify the loan.
I was certainly damaged in regards to the fees and additional costs I have had to
pay to attorney’s [sic] and experts in order to avoid foreclosure.
Docket no. 19-12.
“An affidavit or declaration used to support or oppose a motion must be made on
personal knowledge, set out facts that would be admissible in evidence, and show that the affiant
or declarant is competent to testify on the matters stated.” FED. R. CIV. P. 56(c)(4). Defendant
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argues that these statements are conclusory, hearsay, and contradict the terms of the agreement.
Although taken in isolation, these statements may appear to be conclusory or unsupported by
evidence, when the Court reads the statements in the context of the entire affidavit, the Court
does not find it appropriate to strike the individual statements. To the extent that Plaintiff makes
mere conclusory allegations in his affidavit, the Court does not construe such statements to find
that there is a fact issue when deciding Defendant’s motion for summary judgment. Otherwise,
Defendant’s motion to strike is denied.
II.

Defendant’s Motion for Summary Judgment and Judgment on the Pleadings
A. Legal Standard
The court shall grant 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). To establish that there is no genuine issue as to any material fact, the movant must
either submit evidence that negates the existence of some material element of the non-moving
party’s claim or defense, or, if the crucial issue is one for which the non-moving party will bear
the burden of proof at trial, merely point out that the evidence in the record is insufficient to
support an essential element of the non-movant’s claim or defense. Lavespere v. Niagra Machine
& Tool Works, Inc., 910 F.2d 167, 178 (5th Cir. 1990), cert. denied, 510 U.S. 859 (1993). Once
the movant carries its initial burden, the burden shifts to the non-movant to show that summary
judgment is inappropriate. See Fields v. City of S. Hous., 922 F.2d 1183, 1187 (5th Cir. 1991).
For a court to conclude that there are no genuine issues of material fact, the court must be
satisfied that no reasonable trier of fact could have found for the non-movant, or, in other words,
that the evidence favoring the non-movant is insufficient to enable a reasonable jury to return a
verdict for the non-movant. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 n.4 (1986).

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In making this determination, the court should review all evidence in the record, giving credence
to the evidence favoring the non-movant as well as the “evidence supporting the moving party
that is uncontradicted and unimpeached, at least to the extent that evidence comes from
disinterested witnesses.” Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 151 (2000).
“The standard for dismissal under Rule 12(c) is the same as that for dismissal for failure
to state a claim under Rule 12(b)(6).” Chauvin v. State Farm Fire & Cas. Co., 495 F.3d 232, 237
(5th Cir. 2007) (citing Johnson v. Johnson, 385 F.3d 503, 529 (5th Cir. 2004)); Guidry v. Am.
Pub. Life Ins. Co., 512 F.3d 177, 180 (5th Cir. 2007) (adopting the same standard after Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “To survive a [Rule 12(b)(6)] 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 (2009) (quoting Twombly, 550 U.S.
at 570). A claim for relief must contain (1) “a short and plain statement of the grounds for the
court's jurisdiction”; (2) “a short and plain statement of the claim showing that the pleader is
entitled to the relief”; and (3) “a demand for the relief sought.” FED. R. CIV. P. 8(a). In
considering a motion to dismiss under Rule 12(b)(6), all factual allegations from the complaint
should be taken as true, and the facts are to be construed favorably to the plaintiff. FernandezMontez v. Allied Pilots Assoc., 987 F.2d 278, 284 (5th Cir. 1993). To survive a 12(b)(6) motion,
a complaint must contain “more than labels and conclusions, and a formulaic recitation of the
elements of a cause of action will not do.” Twombly, 550 U.S. at 555 (2007). “Factual allegations
must be enough to raise a right to relief above the speculative level.” Id. Judgment on the
pleadings is only appropriate when “the material facts are not in dispute and a judgment on the
merits can be rendered by looking to the substance of the pleadings and any judicially noticed

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facts.” Great Plains Trust Co. v. Morgan Stanley Dean Witter & Co., 313 F.3d 305, 312 (5th Cir.
2009).
B. Application
Defendant argues that Plaintiff’s claims for breach of contract, a TDCA violation, and
declaratory judgment fail as a matter of law and based on the pleadings.
1. Plaintiff’s Breach of Contract Claim
Plaintiff alleges that Defendant breached the parties’ mediation agreement by failing to
provide Plaintiff with a decision on loan modification and subsequently scheduling a foreclosure
sale. Defendant argues Plaintiff offers no evidence that he complied with the mediation
agreement or that Defendant breached the agreement.
Under Texas law, to state a claim for breach of contract, a plaintiff must allege (1) the
existence of a valid contract; (2) performance or tendered performance by the plaintiff; (3)
breach of the contract by the defendant; and (4) damages sustained by the plaintiff as a result of
the breach. Smith Int’l, Inc. v. Egle Group, LLC, 490 F.3d 380, 387 (5th Cir. 2007) (quoting
Valero Mktg. & Supply Co. v. Kalama Int’l, LLC, 51 S.W.3d 345, 351 (Tex. App.—Houston [1st
Dist.] 2001, no pet.)).
First, Plaintiff shows that there is a valid contract. The parties entered into the mediation
agreement, which is identified as a Rule 11 Agreement. “Rule 11 agreements are contracts
relating to litigation, subject, therefore, to general rules of contract construction.” Trudy’s Texas
Star, Inc. v. City of Austin, 307 S.W.3d 894, 914 (Tex. App.—Austin 2010, no pet.).
Next, Defendant argues that Plaintiff did not perform because he breached the contract by
not timely providing all required loan modification documents. Defendant sent the February 8,
2016, letter contemplated by the contract that sets out all documents Plaintiff was required to

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send to Defendant by March 9, 2016. Docket no. 19-1. Plaintiff was required to timely submit
various documents, including a Request for Mortgage Assistance form, IRS Form 4506T-EZ,
copies of documents verifying income, and recent checking and savings statements. Id. The letter
reminds Plaintiff that Defendant must “receive all of the required information listed below by 0309-2016.” Id. at 1.
On March 7, 2016, Plaintiff faxed Defendant the Request for Mortgage Assistance form,
4506T-EZ form, and an authorization to obtain a consumer credit report. Docket no. 19-5. On
March 15, 2016, after the contract’s March 9, 2016, deadline, Plaintiff’s attorney emailed
Plaintiff requesting additional required documents, including a profit and loss statement from the
previous three months, additional proof of income documents, and an additional signature on the
consumer credit report authorization form. Docket no. 19-6 at 1. On March 23, 2016, and
October 21, 2016, Plaintiff submitted additional required documents to Defendant. Docket nos.
19-7, 19-8. On October 28, 2016, Defendant’s mortgage servicer sent Plaintiff a letter that stated
he had still failed to submit all required documents set out in the February 8, 2016, letter. Docket
no. 19-9. The documents, all of which Plaintiff attached to his response brief, demonstrate that
he did not fulfill his contractual obligation. Further, Plaintiff admits in his response that he did
not send certain required documents until March 23, 2016, and October 21, 2016, well after the
March 9, 2016, deadline imposed by the contract.
The evidence shows that Plaintiff did not provide Defendant with all documents
necessary to comply with Defendant’s loan modification requirements. In construing a contract
under Texas law, a court must ascertain and give effect to the parties’ intentions as expressed in
the contract. Frost Nat’l Bank v. L & F Distributors, Ltd., 165 S.W.3d 310, 312 (Tex. 2005). A
court should consider “the entire writing and attempt to harmonize and give effect to all the

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provisions of the contract by analyzing the provisions with reference to the whole agreement.”
Id. “If, after the pertinent rules of construction are applied, the contract can be given a definite or
certain legal meaning, it is unambiguous and we construe it as a matter of law.” Id. Here, the
Court finds Plaintiff’s contractual obligation to provide specific documents to be unambiguous.
The parties do not dispute that Plaintiff was required to submit specific documents, or that the
documents were to be submitted by March 9, 2016.
The evidence in this case shows that Plaintiff breached the mediation agreement by
failing to timely submit the required documents. Plaintiff’s statements in his affidavit, without
further evidence, do not create a fact issue as to whether he complied with the contract. A party
to a contract who breaches that contract cannot maintain an action for breach of contract.
Dobbins v. Redden, 785 S.W.2d 377, 378 (Tex. 1990). Plaintiff admits that he submitted
additional documents after the March 9, 2016, deadline. Under the agreement’s terms, Plaintiff’s
failure allowed Defendant to move forward with a Rule 736 foreclosure hearing with proper
notice. Although Plaintiff argues that his performance may be excused by Defendant impeding
his performance, Plaintiff offers no evidence that indicates Defendant impeded Plaintiff from
timely submitting the required documents. There is no genuine dispute of material fact that
Plaintiff did not perform his obligation under the mediation agreement. Thus, Defendant is
entitled to summary judgment on Plaintiff’s breach of contract claim.
2. Plaintiff’s TDCA Violation Claim
Plaintiff alleges that Defendant violated the TDCA by using threats, coercion, or
attempted coercion, as well as by making fraudulent, deceptive, or misleading representations.
Defendant argues that Plaintiff offers no evidence to establish any such violations.

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Plaintiff first asserts that Defendant violated Texas Finance Code § 392.301(a)(3). Under
this provision, “a debt collector may not use threats, coercion, or attempts to coerce” that
represent or threaten to represent “to any person other than the consumer that a consumer is
wilfully refusing to pay a nondisputed consumer debt when the debt is in dispute and the
consumer has notified in writing the debt collector of the dispute.” TEX. FIN. CODE
§ 392.301(a)(3). Plaintiff, however, alleges no specific threat, coercion, or attempt to coerce
carried out by Defendant, nor does Plaintiff provide any evidence of such acts. Instead, Plaintiff
only points to the evidence he relies on for his breach of contract claim. However, none of these
documents, including the mediation agreement and the correspondence Defendant sent
requesting all required modification documents, show any evidence of a violation of
§ 392.301(a)(3). Plaintiff has failed to show any genuine dispute of material fact as to whether
Defendant used threats, coercion, or attempts to coerce Plaintiff. Thus, Defendant is entitled to
summary judgment on this TDCA claim.
Plaintiff also asserts that Defendant violated § 392.304(a)(8). A debt collector “may not
use a fraudulent, deceptive, or misleading representation” that misrepresents “the character,
extent, or amount of a consumer debt, or misrepresent[s] the consumer debt’s status in a judicial
or governmental proceeding.” TEX. FIN. CODE § 392.304(a)(8). Again, Plaintiff presents no
evidence of any specific misrepresentation, and again, only relies generally on the evidence from
his breach of contract claim. “For a statement to constitute a misrepresentation under the TDCA,
[a defendant] ‘must have made a false or misleading assertion.’” Cox v. Hilco Receivables,
L.L.C., 726 F. Supp. 2d 659, 667 (N.D. Tex. 2010) (quoting Reynolds v. Sw. Bell Tel., L.P., 2-05356-CV, 2006 WL 1791606, at *7 (Tex. App.—Fort Worth June 29, 2006, pet. denied)). Here,
Plaintiff provides no evidence of any false or misleading assertion made by Defendant. Further,

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to the extent that Plaintiff’s claim is based on Defendant’s threat to foreclose on the Property,
“foreclosure, or the threat of foreclosure, is not an action prohibited by law when a plaintiff has
defaulted on [his] mortgage.” Wildy v. Wells Fargo Bank, NA, No. 3:12-CV-01831-BF, 2012
WL 5987590, at *3 (N.D. Tex. Nov. 30, 2012). Here, it is undisputed that Plaintiff defaulted on
his loan. Defendant’s attempt to foreclose on the Property was not unlawful. Plaintiff has failed
to show any genuine dispute of material fact as to whether Defendant made any unlawful
misrepresentation as a debt collector. Thus, Defendant is entitled to summary judgment on this
TDCA claim as well.
3. Plaintiff’s Request for Declaratory Judgment
Plaintiff asks the Court to declare that Defendant did not comply with the mediation
agreement and order Defendant to comply with the agreement prior to posting for and
foreclosing on the Property. Defendant argues Plaintiff is not entitled to declaratory judgment.
The Declaratory Judgment Act is a procedural device that creates no substantive rights,
and it requires the existence of a justiciable controversy. Phillips v. Beauly, LLC, No. 4:16-CV02272, 2017 WL 3387187, at *2 (S.D. Tex. Aug. 7, 2017) (citing Lowe v. Ingalls Shipbuilding, A
Div. of Litton Sys., Inc., 723 F.2d 1173 (5th Cir. 1984)). There must be a “substantial
controversy, between parties having adverse legal interests, of sufficient immediacy and reality
to warrant the issuance of a declaratory judgment.” MedImmune, Inc. v. Genentech, Inc., 549
U.S. 118, 127 (2007). If there is no viable, underlying claim for a court to adjudicate, then a
party is not entitled to declaratory relief. See Val-Com Acquisitions Tr. v. CitiMortgage, Inc., 421
F. App’x 398, 400–01 (5th Cir. 2011). As discussed above, Plaintiff has no viable, underlying
claim for either breach of contract or violation of the TDCA. Thus, Plaintiff is not entitled to
declaratory judgment.

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CONCLUSION
For the foregoing reasons, the Court DENIES Defendant’s Motion to Strike (Docket no.
21) and GRANTS Defendant’s Motion for Summary Judgment and Judgment on the Pleadings
(Docket no. 17). Plaintiff’s claims are hereby DISMISSED WITH PREJUDICE. The Clerk is
directed to issue a Judgment in favor of Defendant and that Plaintiff takes nothing on his claims.
It is so ORDERED.
SIGNED this 14th day of August, 2018.

XAVIER RODRIGUEZ
UNITED STATES DISTRICT JUDGE

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