736 F.3d 711 (6th Cir. 2013), 12-4248, Marais v. Chase Home Finance LLC

Docket Nº:12-4248.
Citation:736 F.3d 711
Opinion Judge:PER CURIAM.
Party Name:Christine MARAIS, Plaintiff-Appellant, v. CHASE HOME FINANCE LLC, Defendant-Appellee.
Attorney:Troy J. Doucet, Doucet & Associates, LLC, Columbus, Ohio, for Appellant. Daniel C. Gibson, Bricker & Eckler LLP, Columbus, Ohio, for Appellee. Troy J. Doucet, Audra L. Tidball, Doucet & Associates, LLC, Columbus, Ohio, for Appellant. Daniel C. Gibson, Anne Marie Sferra, Nelson M. Reid, Bricker & ...
Judge Panel:Before: GILMAN and GRIFFIN, Circuit Judges.[*]
Case Date:November 26, 2013
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit

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736 F.3d 711 (6th Cir. 2013)

Christine MARAIS, Plaintiff-Appellant,


CHASE HOME FINANCE LLC, Defendant-Appellee.

No. 12-4248.

United States Court of Appeals, Sixth Circuit.

November 26, 2013

Argued: June 19, 2013.

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Troy J. Doucet, Doucet & Associates, LLC, Columbus, Ohio, for Appellant.

Daniel C. Gibson, Bricker & Eckler LLP, Columbus, Ohio, for Appellee.


Troy J. Doucet, Audra L. Tidball, Doucet & Associates, LLC, Columbus, Ohio, for Appellant.

Daniel C. Gibson, Anne Marie Sferra, Nelson M. Reid, Bricker & Eckler LLP, Columbus, Ohio, for Appellee.

Before: GILMAN and GRIFFIN, Circuit Judges.[*]



Christine Marais appeals the dismissal of her claims under the Truth in Lending Act (TILA), 15 U.S.C. § 1601, et seq., and the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. § 2601, et seq., on Defendant Chase Home Finance (Chase)'s motion for judgment on the pleadings. We AFFIRM the dismissal of the TILA claim and REVERSE the dismissal of the RESPA claims.


This case arises from a residential loan servicing agreement between Marais, the obligor/borrower, and Chase, a servicer of her loan. The background facts set forth by the district court are undisputed:

On or about September 25, 2006, Plaintiff executed a promissory note and mortgage for the purpose of financing a residential property in Franklin County, Ohio. The promissory note was between Plaintiff and Residential Finance Corporation, designated as the " lender." Although the timing is unclear from the pleadings, at some point [Chase] became the " servicer" of Plaintiff's loan.

On January 3, 2011, Plaintiff sent a letter, designated as a " Qualified Written Request" (QWR) to [Chase]. The letter stated that it was being sent pursuant to [RESPA,] 12 U.S.C. [2]605(e)[,] and requested information relating to Plaintiff's loan. The QWR specifically requested information such as the amount owed on the loan, the identity of the " current holder" of the loan and the date on which the current holder obtained the loan, the date [Chase] began servicing the loan, and a breakdown of all charges accrued on the account. In her QWR, Plaintiff disputed all late fees and other charges and noted that [Chase] had refused to give her a loan modification for which she was qualified. Plaintiff also noted that [Chase] had failed to provide a copy of the Note which [she had requested] on November 22, 2010. Plaintiff requested receipt of all documents within sixty days, as required under [RESPA,] 12 U.S.C. § 2605(e).

By letter dated January 7, 2011, [Chase] acknowledged receipt of Plaintiff's request. [Chase] then sent a letter dated February 28, 2011, to Plaintiff. According to the letter, [Chase] was enclosing copies of the Note, Security Instrument, Loan Transaction History, Escrow Disclosure Statements, Appraisal and Payoff Quote. (Doc. 2-3). The letter further stated that any information

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which was requested but not included was either unavailable or considered proprietary and would not be provided. ( Id. ) Although requested by Plaintiff, [Chase's] letter did not provide the identity of the owner of Plaintiff's loan, did not provide information related to the correctness of Plaintiff's account, and did not provide any contact information for an employee who could provide assistance to the Plaintiff. (Complaint ¶ 23-27).

Plaintiff alleges that between [January 13, 2009, and] August 13, 2009, she made excess payments totaling approximately $574.89 which [Chase] failed to credit to Plaintiff's principal balance. She further alleges that on November 26, 2007, [Chase] received $221.21 for Plaintiff's account which was not credited to her principal balance. According to Plaintiff, rather than crediting her account, [Chase] kept these payments for its own benefit.

On April 12, 2011, Plaintiff filed the instant suit ... alleg[ing] claims for violation of [TILA], 15 U.S.C. § 1641(f)(2), [RESPA], 12 U.S.C. § 2605(e)(2), the Ohio Consumer Sales Practices Act, Ohio Rev.Code § 1345.01, et seq. , and for common law conversion.

PageID 626-28/R. 33.

Well after Marais filed the instant action and after Marais responded to Chase's motion for judgment on the pleadings, Chase for the first time identified the owner of Marais's loan, Federal National Mortgage Association (Fannie Mae).1

The district court granted Chase's motion for judgment on the pleadings on the TILA and RESPA claims, declined to exercise supplemental jurisdiction over the state law claims, and dismissed the case in its entirety. PageID 626/R. 33.


This court reviews the district court's grant of judgment on the pleadings under Fed.R.Civ.P. 12(c) applying the same de novo standard of review applicable to orders of dismissal under Rule 12(b)(6). Poplar Creek Dev. Co. v. Chesapeake, 636 F.3d 235, 240 (6th Cir.2011). " [A]ll well-pleaded material allegations of the pleadings of the opposing party must be taken as true, and the motion may be granted only if the moving party is nevertheless clearly entitled to judgment." Id. (citation omitted); see also Coyer v. HSBC Mortg. Servs., Inc., 701 F.3d 1104, 1107-08 (6th Cir.2012).

Although a complaint need not contain " detailed factual allegations," it does require more than " labels and conclusions" or " a formulaic recitation of the elements of a cause of action." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). Thus, a complaint survives a motion to dismiss if it " contain[s] 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, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). And, " [a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable

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for the misconduct alleged." Hensley Mfg. v. ProPride, Inc., 579 F.3d 603, 609 (6th Cir.2009) (quoting Iqbal, 129 S.Ct. at 1949).

Reilly v. Vadlamudi, 680 F.3d 617, 622-23 (6th Cir.2012).


The declared purpose of TILA, 15 U.S.C. § 1601, et seq., is " to assure a meaningful disclosure of credit terms so that the consumer will be able to compare more readily the various credit terms available to him and avoid the uninformed use of credit, and to protect the consumer against inaccurate and unfair credit billing and credit card practices." Beach v. Ocwen Fed. Bank, 523 U.S. 410, 412, 118 S.Ct. 1408, 140 L.Ed.2d 566 (1998) (quoting 15 U.S.C. § 1601(a)). Accordingly, TILA requires creditors/owners to " provide borrowers with clear and accurate disclosures of terms dealing with things like finance charges, annual percentage rates of interest, and the borrower's rights." Id. (citing 15 U.S.C. §§ 1631, 1632, 1635, 1638). TILA is a remedial statute and should be given " a broad, liberal construction in favor of the consumer." Clemmer v. Key Bank Nat'l Ass'n, 539 F.3d 349, 353 (6th Cir.2008); Begala v. PNC Bank, Ohio N.A., 163 F.3d 948, 950 (6th Cir.1998).

TILA defines " creditor" as

only ... a person who both (1) regularly extends ... consumer credit ..., and (2) is the person to whom the debt arising from the consumer credit transaction is initially payable ...

15 U.S.C. § 1602(g) (formerly § 1602(f)). Because the debt was not initially payable to Chase, Marais has not alleged that Chase is or was a creditor of her loan.


Marais's claim is based on her interpretation of amendments to TILA's civil-liability provision, § 1640, and liability-of-assignees provision, § 1641. She contends that Chase's liability does not depend on its being a creditor.

The TILA amendments on which Marais relies were part of the Helping Families Save Their Homes Act of 2009, Pub.L. No. 111-22, § 404(g), 123 Stat. 1632, 1658, which amended TILA in two ways. First, it added subsection (g) to § 1641, requiring that new owner-assignees of loans (referred to as " new creditors" ) notify the borrower of certain information about the assignment. Second, and directly at issue here, it added the phrase " subsection (f) or (g) of section 1641" 2 (in bold type below) to the civil liability provision, § 1640.

Section 1640 now provides:

(a) Individual or class action for damages; amount of award; factors determining amount of award

Except as otherwise provided in this section, any creditor who fails to comply with any requirement imposed under this part, including any requirement under ... subsection (f) or (g) of section 1641 of this title ... is liable to such person in an amount equal to the sum of—

(1) any actual damage sustained by such person as a result of the failure;


With respect to any failure to make disclosures required under this part or part D or E of this subchapter, liability shall be imposed only upon the creditor

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required to make disclosure, except as provided in [15 U.S.C. § 1641].

15 U.S.C. § 1640(a) (emphasis added).

Section 1641, addressing the liability of assignees, provides that any civil action that may be brought against a creditor may also be brought against a creditor's voluntary assignee only if the violation is apparent on the face of the disclosure statement:

(e) Liability of assignee for consumer credit transactions secured by real property

(1) In general Except as otherwise specifically provided in this subchapter, any civil action against a creditor for a violation of this subchapter, and any proceeding under section 1607 of this title against a creditor, with respect to a consumer credit transaction secured by real property may be maintained against any assignee of such creditor only if—

(A) the violation for which such action or proceeding is brought is apparent on the face of the disclosure statement provided in connection with such transaction pursuant to this subchapter; and

(B) the assignment to the...

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