Benner v. Bank of Am., N.A.
| Decision Date | 07 January 2013 |
| Docket Number | Civil Action No. 11–6574. |
| Parties | Charles N. BENNER, on behalf of himself and all others similarly situated, Plaintiff, v. BANK OF AMERICA, N.A., et al., Defendants. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
OPINION TEXT STARTS HERE
Noah I. Axler Donavan Axler, LLC, Irv Ackelsberg Langer Grogan & Diver PC, Philadelphia, PA, for Plaintiff.
Andrew J. Soven, Marc A. Goldich, Reed Smith LLP, Philadelphia, PA, for Defendants.
Plaintiff Charles Benner is a residential homeowner in Pennsylvania. His mortgage is serviced by Defendant Bank of America.1 Under the mortgage agreement, Defendant is permitted to charge Plaintiff for certain services if he defaults on his mortgage. In 2009, Plaintiff defaulted and Defendant began performing monthly property inspections in accordance with the terms of the mortgage. In late 2010, Defendant sent a notice to Plaintiff, as required by Pennsylvania law, of its intention to initiate foreclosure proceedings. The pre-foreclosure notice listed the specific amounts that Plaintiff was required to pay to cure his default. Included among them was a fee of $262.50 for the property inspections. Plaintiff did not pay this fee, nor was his home foreclosed upon, but he contends in this case that the inspections were unnecessary and therefore Defendant's request for payment violated four federal and state laws. In addition, Plaintiff makes claims against Defendant for conduct unrelated to the property inspection fees.
First, regarding the property inspection fees, Plaintiff contends that the request for payment of these fees violated provisions of the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. § 1692e and § 1692f. Section 1692e prohibits debt collectors from using “any false, deceptive, or misleading representation or means in connection with the collection of any debt,” which includes “false representation of ... the character, amount, or legal status of any debt.” Section 1692f provides that “[t]he collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) [is prohibited] unless such amount is expressly authorized by the agreement creating the debt or permitted by law.” Plaintiff alleges that false representations regarding property inspection fees were made by Defendant in violation of the FDCPA when this Act is considered in conjunction with another statute, the Pennsylvania Loan Interest and Protection Law (also known as “Act 6”).
Act 6, which is the second law Plaintiff contends was violated, required Defendant to send Plaintiff a written notice of its intention to foreclose on his property. The notice had to inform him of his “right ... to cure the default ... and exactly what performance including what sum of money, if any, must be tendered.” 41 Pa. Stat. § 403(c)(3). Furthermore, Act 6, among other things, limits the sum of money that can be demanded to “the reasonable costs of proceeding to foreclosure as specified in writing by the residential mortgage lender actually incurred to the date of payment.” Id. § 404(b)(3). Plaintiff contends that Defendant's property inspection fees were unnecessary and thus not “reasonable costs of proceeding to foreclosure” or even permitted by the mortgage agreement.2 Given the specific terms of Act 6, Plaintiff claims that Defendant falsely stated the amount of Plaintiff's debt in the pre-foreclosure notice in violation of § 1692e and § 1692f.
Next, Plaintiff contends that Defendant's conduct regarding the inspection fees also violated the Pennsylvania Fair Credit Extension Uniformity Act, the third law allegedly violated by Defendant. This Act states that “[i]t shall constitute an unfair or deceptive debt collection act or practice under this act if a debt collector violates any of the provisions of the [FDCPA].” 73 Pa. Stat. § 2270.4.
Finally, Plaintiff brings a Pennsylvania common law claim for unjust enrichment, again based on Defendant's attempted collection of the property inspection fees.
Plaintiff also asserts an FDCPA claim against Defendant for conduct unrelated to the property inspection fees. The Pennsylvania Foreclosure Prevention Act (also known as “Act 91”) required Defendant's pre-foreclosure notices to include information on how to apply for the Homeowner's Emergency Mortgage Assistance Program (“HEMAP”). 35 Pa. Stat. § 1680.403c(b)(1). Specifically, Defendant was required to advise Plaintiff as the debtor that he had “thirty (30) days, plus (3) days for mailing, to have a face-to-face meeting with a consumer credit counseling agency to attempt to resolve the delinquency or default,” id., and that an “application for mortgage assistance [could] be submitted to [HEMAP] beyond the thirty (30)-day period.” Id. § 1680.403c(b)(7). Plaintiff contends that Defendant violated § 1692e of the FDCPA by sending pre-foreclosure notices that contained false or misleading information about how and when he could exercise his HEMAP rights under Act 91.
Lastly, Plaintiff argues that Defendant violated federal law by failing to provide adequate responses to his multiple written requests for mortgage information. The Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. § 2605(e), imposes a duty on loan servicers to respond to borrowers' inquiries within a certain time frame. Section 2605(e)(1)(A) states that “the servicer shall provide a written response...
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