Amini v. Bank of America Corp., C11-0974RSL
| Decision Date | 07 February 2012 |
| Docket Number | No. C11-0974RSL,C11-0974RSL |
| Court | U.S. District Court — Western District of Washington |
| Parties | FARBOD AMINI, Plaintiff, v. BANK OF AMERICA CORPORATION et al., Defendants. |
This matter comes before the Court on "Defendants' Motion to Dismiss Plaintiff's First Amended Complaint." Dkt. # 23. Defendants Bank of America ("BoA") and LandSafe Appraisal Services, Inc. ("LandSafe") seek dismissal of all of plaintiff's claims under Fed. R. Civ. P. 12(b)(6). In the context of a motion to dismiss under Fed. R. Civ. P. 12(b)(6), the allegations of the complaint are accepted as true and construed in the light most favorable to plaintiff. In re Syntex Corp. Sec. Litig., 95 F.3d 922, 925-26 (9th Cir. 1996); LSO, Ltd. v. Stroh, 205 F.3d 1146, 1150 n.2 (9th Cir. 2000). The question for the Court is whether the well-pled facts in the complaint sufficiently state a "plausible" ground for relief. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). Although a complaint need not provide detailed factual allegations, it must offer "more than labels and conclusions" and contain more than a "formulaic recitation of the elements of a cause of action." Twombly, 550 U.S. at 555. If the complaint fails to state a cognizable legal theory or fails to provide sufficient facts to support a claim,dismissal is appropriate. Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530, 534 (9th Cir. 1984).
Having reviewed the papers submitted by the parties and heard the oral argument of counsel, the Court finds as follows:
BACKGROUND1
In March 2005, third-party Kazem Noven, acting on plaintiff's behalf, borrowed money from Countrywide Bank, N.A., to purchase real property located at 97 Utsalady Road, Camano Island, WA. Countrywide had its subsidiary, defendant LandSafe, perform an appraisal of the real property to determine whether the property provided adequate collateral for the purchase loan. Although plaintiff never saw the appraisal, he knew that one had been obtained by Countrywide and correctly surmised that LandSafe had valued the property at or near the purchase price. Plaintiff relied on the appraised value when he authorized Mr. Noven to complete the purchase: he would not have gone through with the purchase had the appraisal revealed that the property was not worth the purchase price.
From the start, plaintiff made the payments on the loan. In December 2005, Mr. Noven transferred a one-half interest in the real property to plaintiff. In August 2006, plaintiff obtained a loan in his own name from Countrywide and acquired full title to the property from Mr. Noven. Because the real property was once again offered as collateral for the loan, Countrywide retained LandSafe to perform another appraisal. At the time of closing, plaintiff was aware that the appraised amount was at least sufficient to cover the value of his $504,000 loan plus a $30,000 line of credit he obtained from Countrywide. Plaintiff relied on this second appraisal when completing the August 2006 transactions.
On June 25, 2008, plaintiff received an invoice from a company he had hired topump out the septic system at 97 Utsalady Road. The invoice provided the first notice that the waste disposal system was not operable and had not been operable since before 2005. While investigating possible remedies for the waste disposal problems, plaintiff discovered that the foundation of the house had been compromised by the inoperable system. Plaintiff communicated frequently with Countrywide and its successor, BoA,2 regarding the problems on the site and potential repair options. At the lender's request, plaintiff made a claim to his real property insurer concerning the septic tank and drainfield problems. The claim was rejected. With repair costs estimated in the hundreds of thousands of dollars and in the absence of insurance coverage, plaintiff determined that the real property was essentially worthless and stopped making payments on the August 2006 loan and line of credit.
Plaintiff requested copies of the 2005 and 2006 appraisal reports created by LandSafe. BoA or its agent refused to provide a copy of the 2005 appraisal, but sent a copy of the 2006 report on or about June 30, 2010. On April 8, 2010, the Island County Department of Public Health barred occupancy or use of the real property for any purpose until an approved waste disposal system is installed.
Starting in September 2010, plaintiff's attorney sent at least five requests for copies of certain documents and categories of documents to Bank of America Home Loans Servicing, LP.3 BoA or its agent responded to the first letter, but declined to produce any documents because the signature on the request "did not appear to match the signature on the original loan documents." First Amended Complaint (Dkt. # 17), Ex. 2. Plaintiff's October 18,2010, request for documents noted (a) that an authorization was provided and that BoA had not clearly stated the ground for its objection, (b) that an authorization is not necessary when the author of the request identifies himself as an attorney acting on behalf of his client, and (c) that BoA's continuing failure to comply with the request for information may result in the initiation of a legal action for violation of the Real Estate Settlement Procedures Act. Plaintiff, through counsel, repeated its request for documents related to his loans. BoA or its agent again declined to comply, this time asserting that plaintiff had failed to provide a written authorization allowing BoA to release the loan information to the attorney. Plaintiff's attorney sent another letter detailing his and his client's efforts to obtain the requested documents over a two month period and reiterating the request. The request was again denied "because the signature of the borrower on your request did not appear to match the signature on the original loan documents." First Amended Complaint (Dkt. # 17), Ex. 6.
After plaintiff stopped making payments on his loans, BAC Home Loans Servicing took certain steps constituting "debt collection" under the Fair Debt Collection Practices Act in its attempt to obtain repayment of the loans.4 BAC Home Loans Servicing called plaintiff on several occasions before 8:00 am or after 9:00 pm and frequently telephoned more than one time per day. Plaintiff and his attorney notified BAC Home Loans Servicing that plaintiff was represented and that all communications should go through counsel, but to no avail. On June 13, 2011, BoA notified plaintiff that the servicing responsibilities for plaintiff's loans would be transferred from BAC Home Loans Servicing to BoA. Plaintiff, through his attorney, informed BoA of the representational relationship. BoA nevertheless continues to contact plaintiff directly. At some point prior to July 2011, ownership of the promissory note related to the mortgage was transferred to Wells Fargo, while ownership of the promissory note related to theline of credit was transferred to E*Trade Bank. BoA continues to act as the loan servicer for both loans.
RESPA requires lenders and loan servicers to timely respond to Qualified Written Requests ("QWRs") from borrowers. Within 5 days of receipt of a QWR from a borrower, a lender or servicer must provide written acknowledgment. 12 U.S.C. § 2605(e)(1)(A).5 Within 30 days after receiving a QWR, the servicer must provide the borrower with a written response that includes the information requested by the borrower or an explanation of why the information is unavailable or cannot be obtained by the servicer. 12 U.S.C. § 2605(e)(2)(C). Plaintiff alleges that BoA violated RESPA when its agent and loan servicer, BAC Home Loans Servicing, refused to provide documents related to plaintiff's loans despite numerous QWRs. Plaintiff alleges that BoA is also liable under RESPA as the successor of BAC Home Loans Servicing. Defendants seek dismissal of this claim because (1) plaintiff's letters did not constitute QWRs as defined in the statute and (2) plaintiff has failed to allege actual damages.6
12 U.S.C. § 2605(e)(1)(B). Although there is no indication that plaintiff believed there was an error in his account, he clearly identified documents and categories of documents (i.e., "other information" in the parlance of § 2605(e)(1)(B)) that he sought from the servicer. Courts in this district disagree on whether a request for documents or information regarding the servicing of a loan constitutes a QWR in the absence of a claim of error. See Eifling v. Nat'l City Mortg., 2011 WL 892322 at *2-3 (W.D. Wash. Mar. 15, 2011) (); Moon v. GMA Mortg. Corp., 2009 WL 3185596 at *4 (W.D. Wash. Oct. 2, 2009) ().
The Eifling court was concerned that borrowers who had defaulted on their loans could "flood their lender with documentation requests, on the hope that a failure to timely comply will lead to an affirmative cause of action, or a defense to a collection or foreclosure action." Eifling, 2011 WL 892322 at *3. RESPA has built-in procedures and requirements that will, for the most part, forestall the feared flood. A request for documents...
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