BEAZIE v. AMERIFUND FINANCIAL Inc. dba ALL FUND MORTGAGE
| Decision Date | 14 April 2011 |
| Docket Number | CIVIL NO. 09-00562 JMS/KSC |
| Parties | VINCENT TOD BEAZIE, Individually and as Trustee of the Vincent T. Beazie Revocable Living Trust Dated April 17, 2001, Plaintiff, v. AMERIFUND FINANCIAL, INC. dba ALL FUND MORTGAGE, a Washington corporation registered previously as a foreign corporation doing unlicensed business in the State of Hawaii, its successors and assigns; MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., a Delaware corporation; DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee for American Mortgage-Backed Pass-Through Certificates, Series 2007-5, a New York corporation; and DOES 1-30,Defendants. |
| Court | U.S. District Court — District of Hawaii |
OPINION TEXT STARTS HERE
On July 22, 2009, Plaintiff Vincent Tod Beazie, Individually and as Trustee of the Vincent T. Beazie Revocable Living Trust Dated April 17, 2001 ("Plaintiff^') filed this action in the First Circuit Court of the State of Hawaii. Plaintiff's First Amended Complaint ("FAC") asserts claims against Defendants Amerifund Financial Inc. dba All Fund Mortgage ("Amerifund"), Mortgage Electronic Registration Systems ("MERS"), and Deutsche Bank National Trust Company as Trustee for American Mortgage-backed Pass-through Certificates, Series 2007-5 ("DBNTC") for violations of the Truth in Lending Act ("TILA"), 15 U.S.C. § 1601 et seq, the Real Estate Settlement Procedures Act of 1974 ("RESPA"), 12 U.S.C. § 2601, et seq., and various state law claims stemming from a mortgage transaction concerning real property located at 91-423 Pupu Street, Ewa Beach, Hawaii 96706 (the "subject property"). The action was subsequently removed to this court.
Currently before the court is MERS and DBNTC's (collectively, "Moving Defendants") Motion for Summary Judgment in which they argue that there is no genuine issue of material fact supporting any of Plaintiff's claims against them. Based on the following, the court GRANTS Moving Defendants' Motion for Summary Judgment.
On March 26, 2007, Plaintiff refinanced his existing loan on the subject property by executing an adjustable rate note in the amount of $1,260,000 in favor of Amerifund, which was secured by a mortgage on the subject property. Defs.' Exs. 1, 3. The mortgage explains that MERS is the mortgagee, and is "acting solely as nominee" for Amerifund. Defs.' Ex. 3 at 1-2.
In consummating this loan, Plaintiff signed a Uniform Residential Loan Application (the "Application"), which states that Plaintiff was applying for a 480-month adjustable rate mortgage in the amount of $1,260,000. Defs.' Ex. 2 at 56; Defs.' Ex. 4 at 1. The Application states that Plaintiff acknowledges that "the information provided in this application is true and correct as of the date set forth opposite my signature," and Plaintiff admits that he signed this acknowledgment. Defs.' Ex. 2 at 58-59; Defs.' Ex. 4 at 3. The Application nonetheless included false information, including that Plaintiff's gross monthly income was $18,000 when in fact it was much less. Pl.'s Decl. ¶ 6.
In addition to the Application, Plaintiff signed the note, mortgage, Adjustable Rate Mortgage Loan Disclosure Statement, TILA Disclosure Statement, and Notice of Right to Cancel. See Defs.' Concise Statement of Facts ("CSF") ¶7.1 Although Plaintiff acknowledged that his signature indicates that he received these documents, Defs.' Ex. 2 at 78-81, Plaintiff disputes that he received two completed and accurate copies of the Notice of the Right to Cancel. Plaintiff further conceded that he understood that the interest rate on the loan would change, but believed that his payment would not exceed more than $100 of his initial monthly payment. Defs.' Ex. 2 at 60-61. Plaintiff understood, however, that he would be responsible for any default on the loan. Id. at 61.
According to Plaintiff, he was aware there was another appointment after him such that he had only a half hour to complete the documents, but nobody told him that he had only a specific amount of time to review and sign the documents or that he needed to hurry. Id. at 57, 62. Plaintiff asserts that although his signature states that he read and understood the documents, he did not read each document because he relied "on the professionality [sic] of the qualified person" to sign the documents and that it is "common practice" to sign without reading them. Defs.' Ex. 2 at 59, 66, 70.
In November 2008, Plaintiff started defaulting on the loan. Id. at 60. On June 1, 2009, an "Assignment of Mortgage" was recorded in the Hawaii State Bureau of Conveyances, asserting that MERS has transferred the mortgage toDBNTC. Defs.' Ex. 8. That same day, DBNTC's servicing agent American Home Mortgage Servicing, Inc. ("AHMSI") commenced a nonjudicial foreclosure action of DBNTC's interests under the mortgage by recording a Notice of Mortgagee's Intention to Foreclose Under Power of Sale. Defs.' Ex. 9. Pursuant to that notice, on July 22, 2009, the subject property was sold through auction to DBNTC. Defs.' Exs. 11-12.
The same day as the auction, Plaintiff sent via certified mail a letter cancelling the loan transaction due to alleged TILA violations. See Pl.'s Exs. H, I. The letter was delivered to DBNTC on July 24, 2009. Pl.'s Ex. I.
On July 22, 2009, Plaintiff filed this action in the First Circuit Court of the State of Hawaii. Plaintiffs' FAC alleges claims against Defendants2 titled (1) Declaratory Judgment Re: Title to the Subject Property Against Deutsche Bank (Count I); (2) Declaratory Judgment Re: Fraud and Rescission and Common Law Damages Against Amerifund, MERS, and Deutsche Bank (Count II); (3) Declaratory Judgment Re: Chapter 480 HRS Rescission and Treble Damages Against Amerifund, MERS, and Deutsche Bank (Count III); (4) Injunctive ReliefAgainst Deustche Bank and Real Time (Count IV); (5) Declaratory Judgment Re: TILA and RESPA Statutory Damages Against Amerifund, MERS, and/or Deutsche Bank (Count V); (6) Breach of Fiduciary Duty Against Amerifund (Count VI); and (7) Punitive Damages Against Amerifund (Count VII). DBNTC subsequently removed the action to this court.
On December 29, 2010, Moving Defendants filed their Motion for Summary Judgment. Plaintiff filed a Concise Statement on March 8, 2011, and an Opposition on March 9, 2011.3 Moving Defendants filed a Reply on March 14, 2011. A hearing was held on March 29, 2011. Plaintiff filed a supplemental memorandum on March 30, 2011.
Summary judgment is proper where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). Rule 56(a) mandates summary judgment "against a party who fails to make a showing sufficient to establish the existence of an element essential to the party's case, and on which that party will bear the burden of proof at trial."Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); see also Broussard v. Univ. of Cal. at Berkeley, 192 F.3d 1252, 1258 (9th Cir. 1999).
"A party seeking summary judgment bears the initial burden of informing the court of the basis for its motion and of identifying those portions of the pleadings and discovery responses that demonstrate the absence of a genuine issue of material fact." Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007) (citing Celotex, 477 U.S. at 323); see also Jespersen v. Harrah's Operating Co., 392 F.3d 1076, 1079 (9th Cir. 2004). "When the moving party has carried its burden under Rule 56[(a)] its opponent must do more than simply show that there is some metaphysical doubt as to the material facts [and] come forward with specific facts showing that there is a genuine issue for trial." Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 586-87 (1986) (); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986) ().
"An issue is 'genuine' only if there is a sufficient evidentiary basis on which a reasonable fact finder could find for the nonmoving party, and a dispute is 'material' only if it could affect the outcome of the suit under the governing law." In re Barboza, 545 F.3d 702, 707 (9th Cir. 2008) (citing Anderson, 477 U.S. at248). When considering the evidence on a motion for summary judgment, the court must draw all reasonable inferences on behalf of the nonmoving party. Matsushita Elec. Indus. Co., 475 U.S. at 587; see also Posey v. Lake Pend Oreille Sch. Dist. No. 84, 546 F.3d 1121, 1126 (9th Cir. 2008) .
As a starting place, the court first must determine the precise factual basis of Plaintiff's claims. The FAC asserts in very general terms that Amerifund engaged in various misdeeds in consummating the loan with Plaintiff, and Plaintiff's claims against Moving Defendants are based on Amerifund's misconduct. FAC 10-13. At the hearing, however, Plaintiff's counsel argued that Plaintiff also asserts claims against Moving Defendants for misconduct that occurred in the transfer of the mortgage to DBNTC and DBNTC's failure to honor Plaintiff's rescission. The FAC, however, does not include any facts that would give notice to Defendants, much less the court, that Plaintiff is asserting such claims. Specifically, although the FAC asserts that (1) DBNTC noticed a nonjudicial auction of the subject property without proof that the loan was in default or that DBNTC was the current assignee, and (2) Plaintiff cancelled theloan...
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