Degasparre v. Fay Servicing, LLC
| Decision Date | 13 February 2023 |
| Docket Number | 2021-52-Appeal.,PC 19-8581 |
| Parties | Gerald DEGASPARRE v. FAY SERVICING, LLC, et al. |
| Court | Rhode Island Supreme Court |
John B. Ennis, Esq., for Plaintiff.
Carl E. Fumarola, Esq., for Defendants.
Present: Suttell, C.J., Goldberg, Robinson, and Lynch Prata, JJ.
The plaintiff, Gerald Degasparre, appeals from the entry of summary judgment in favor of the defendants, Fay Servicing, LLC (Fay) and Citibank, N.A., as Trustee of NRZ Pass-Through Trust VI (Citibank) (collectively defendants). This case came before the Supreme Court pursuant to an order directing the parties to appear and show cause why the issues raised in this appeal should not be summarily decided. After considering the parties' written and oral submissions and reviewing the record, we conclude that cause has not been shown and that this case may be decided without further briefing or argument. For the reasons set forth in this opinion, we affirm the judgment of the Superior Court.
On October 22, 2007, plaintiff and his wife, Tracie Degasparre, executed a promissory note and mortgage with Beneficial Rhode Island, Inc. (Beneficial), secured by property located at 149 Sweet Avenue, Pawtucket, Rhode Island.2 The principal amount owed on the note was $267,791.71. During the course of the loan, plaintiff entered into two settlement agreements with Beneficial to restructure some of the repayment terms of the loan.
On May 26, 2017, plaintiff defaulted on the loan. Fay began servicing the loan on July 1, 2017, and was granted power of attorney by the previous loan servicer, HSBC.3 Beneficial later assigned the mortgage and note to Citibank. Fay continued to act as Citibank's servicer for the remainder of the loan period.
After plaintiff's default, Fay initiated the foreclosure process by mailing several notices to plaintiff as required by Rhode Island law and the mortgage terms—a notice of default, notice of mediation conference, notice of foreclosure counseling, and notice of sale (collectively the pre-foreclosure notices). On July 18, 2018, Fay sent plaintiff the notice of mediation conference, consistent with G.L. 1956 § 34-27-3.2, alerting plaintiff to the possibility of a foreclosure on his property and the availability of free resources to assist him in avoiding foreclosure. On July 19, 2018, Fay sent plaintiff the notice of default, including a statement of intent to accelerate the loan if the outstanding balance ($28,185.76) was not paid by August 23, 2018.
On November 8, 2018, Harmon Law Offices, P.C. (Harmon), on behalf of Fay, allegedly mailed plaintiff the notice of foreclosure counseling, as presumably required by § 34-27-3.1.4 The plaintiff denied receiving this notice and further claimed that defendants never deposited the notice in the mail.
The mortgage specified the type of notice that the lender was required to send to the borrower prior to accelerating the loan in the event of default. Paragraph 17 provides, in relevant part:
(Emphasis added.)
On May 31, 2019, defendants sent plaintiff the notice of sale. The defendants issued the notice under the statutory power of sale, provided for in the just-quoted paragraph 17. The notice alerted plaintiff that the foreclosure sale was scheduled for August 20, 2019, and that the sale would be advertised beforehand in The Pawtucket Times .
On August 20, 2019, plaintiff filed a complaint and a motion for a temporary restraining order and preliminary injunction to enjoin defendants from proceeding with the foreclosure sale. The same day, a justice of the Superior Court granted the temporary restraining order and continued the matter for a hearing on the preliminary injunction. The Superior Court later denied plaintiff's motion for preliminary injunction. A foreclosure sale was then held on September 3, 2019.
On February 13, 2020, defendants moved for summary judgment. The plaintiff objected to the motion and subsequently filed motions to strike four affidavits submitted by defendants and a motion to amend the complaint. The defendants objected to all four motions to strike and the motion to amend. A justice of the Superior Court heard arguments on all motions on November 30, 2020, and, in a bench decision, he granted defendants' motion for summary judgment as to all of plaintiff's claims, and he denied plaintiff's four motions to strike and plaintiff's motion to amend.
The order and judgment granting summary judgment in favor of defendants entered on December 11, 2020. The plaintiff timely filed a notice of appeal on December 30, 2020.
"This Court reviews a hearing justice's grant of a motion for summary judgment de novo ." Pineda v. Chase Bank USA, N.A. , 186 A.3d 1054, 1056 (R.I. 2018). "We will affirm a summary judgment if, after reviewing the admissible evidence in the light most favorable to the nonmoving party, we conclude that no genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law." Dulong v. Merrimack Mutual Fire Insurance Company , 272 A.3d 120, 125 (R.I. 2022) (quoting Shorr v. Harris , 248 A.3d 633, 636 (R.I. 2021) ).
"[T]he nonmoving party bears the burden of proving by competent evidence the existence of a disputed issue of material fact and cannot rest upon mere allegations or denials in the pleadings, mere conclusions or mere legal opinions." Bayview Loan Servicing, LLC v. Providence Business Loan Fund, Inc. , 200 A.3d 153, 156 (R.I. 2019) (quoting Cancel v. City of Providence , 187 A.3d 347, 350 (R.I. 2018) ).
When we review a ruling on a motion to strike, we review whether the hearing justice abused his or her discretion. See Salvatore v. Palangio , 247 A.3d 1250, 1258 (R.I. 2021) ().
"We accord great deference to the decision by a hearing justice to grant or deny a motion to amend and will not disturb his or her decision unless he or she abused his or her discretion." Bank of America, N.A. v. Fay , 242 A.3d 38, 43 (R.I. 2020) (brackets omitted) (quoting CACH, LLC v. Potter , 154 A.3d 939, 942 (R.I. 2017) ). At the discretion of the hearing justice, Rule 15(a) of the Superior Court Rules of Civil Procedure "liberally permits amendment absent a showing of extreme prejudice." Granoff Realty II, Limited Partnership v. Rossi , 823 A.2d 296, 298 (R.I. 2003) (quoting Wachsberger v. Pepper , 583 A.2d 77, 78 (R.I. 1990) ). "However, a court need not grant leave to amend a pleading when doing so would unduly prejudice the nonmoving party." Weybosset Hill Investments, LLC v. Rossi , 857 A.2d 231, 236 (R.I. 2004).
On appeal, plaintiff argues that the hearing justice erred (1) by granting summary judgment in favor of defendants; (2) by denying plaintiff's motions to strike; and (3) by denying plaintiff's motion to amend. We review the hearing justice's rulings on each of these motions in turn.
The plaintiff raises several arguments opposing the hearing justice's decision to grant defendants' motion for summary judgment. First, plaintiff submits that a genuine dispute of material fact remains as to whether defendants properly provided him with a notice of foreclosure counseling consistent with § 34-27-3.1. Second, plaintiff avers that the notice of default did not strictly comply with the terms of paragraph 17 of the mortgage, particularly in light of this Court's decision in Woel v. Christiana Trust, as Trustee for Stanwich Mortgage Loan Trust Series 2017–17 , 228 A.3d 339 (R.I. 2020). Third, plaintiff argues that the default notice contained an incorrect amount of arrearage, constituting an additional violation of the terms in paragraph 17. Fourth, plaintiff urges that Fay must be held liable under the Rhode Island Fair Debt Collection Practices Act for the violations it allegedly committed in regard to the pre-foreclosure notices.
First, plaintiff argues that the hearing justice erred in granting summary judgment because there remains a dispute of material fact as to whether defendants mailed the notice of foreclosure counseling required by § 34-27-3.1.5 Additionally, plaintiff claims that the hearing justice erred when he stated that the General Assembly repealed § 34-27-3.1 in 2014, thereby relieving defendants of any duty to send the notice.6
For the purposes of the case before us, we need not determine the current validity of § 34-27-3.1. The defendants do not challenge plaintiff's contention regarding § 34-27-3.1. Rather, they argue that "[r]egardless of the confusing effective period of the statute, the record unquestionably demonstrated compliance with § 34-27-3.1 [.]" So too, the hearing justice predicated his decision on summary judgment on the "undisputed, uncontested evidence for purposes of this summary judgment motion, demonstrating that Fay sent plaintiff a notice of availability of mortgage counseling services" pursuant to § 34-27-3.1. As the status of § 34-27-3.1 was not a contested issue before the Superior Court, we shall not address it on appeal.
The...
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