In re Residential Capital, LLC, Case No. 12-12020 (MG)
| Decision Date | 08 May 2015 |
| Docket Number | Case No. 12-12020 (MG) |
| Parties | In re: RESIDENTIAL CAPITAL, LLC, et al., Debtors. |
| Court | U.S. Bankruptcy Court — Southern District of New York |
NOT FOR PUBLICATION
Jointly Administered
APPEARANCES:
MORRISON & FOERSTER LLP
250 West 55th Street
New York, New York 10019
By: Norman S. Rosenbaum, Esq.
Jordan A. Wishnew, Esq.
Meryl L. Rothchild, Esq.
ABOSEDE EBOWEME
4617 Covington Court
Grand Prairie, Texas 75052
By: Abosede Eboweme
Pending before the Court is the ResCap Borrower Claims Trust's (the "Trust") objection (the "Objection," ECF Doc. # 8018) to Claim Number 2267 (the "Claim," id. Ex. 1) filed by Abosede Eboweme ("Eboweme").1 The Claim is premised on causes of action that Eboweme has previously asserted against Debtor GMAC Mortgage, LLC ("GMACM") and other non-debtor defendants in an action filed in Texas in 2011. Specifically, the Claim asserts causes ofaction for (i) wrongful foreclosure; (ii) violations of the automatic stay during Eboweme's bankruptcy case; (iii) intentional infliction of emotional distress ("IIED"); (iv) violations of the Real Estate Settlement Procedures Act ("RESPA"); (v) violations of the Texas Debt Collection Practices Act (the "TDCPA"); and (vi) violations of the Texas Deceptive Trade Practices Act (the "TDTPA"). These causes of action purportedly relate to the foreclosure on Eboweme's home in September 2011. Eboweme filed an opposition to the Objection (the "Opposition," ECF Doc. # 8144).2 The Court held a hearing on the Objection on February 25, 2015 (the "Hearing") and took the matter under submission.3 For the reasons explained below, the Objection is SUSTAINED and the Claim is EXPUNGED.
Eboweme took out a $123,500.00 loan (the "Loan") from Aegis Mortgage Corporation ("Aegis") in February 2002, evidenced by a note (the "Note," Priore Decl. Ex. 3-A) secured by a deed of trust (the "Deed of Trust," id. Ex. 3-B) on real property located in Grand Prairie, Texas (the "Property"). (Priore Decl. ¶ 4.) The Deed of Trust identified Mortgage Electronic Registration Systems, Inc. ("MERS") as the beneficiary.4 (Id.) Debtor Residential Funding Company, LLC ("RFC") purchased the Loan from Aegis and transferred it to JP Morgan Chase Bank ("JPM") when the Loan was securitized in May 2002.5 (Id.) The Loan was removed fromthe securitization trust in January 2007. (Id.) JPM transferred the Loan back to RFC, and RFC securitized the Loan again in February 2007, with LaSalle Bank National Association ("LaSalle") appointed as trustee.6 (Id.) Debtor Homecomings Financial, LLC ("Homecomings") serviced the Loan from March 2002 until July 2009, when servicing was transferred to GMACM. (Id. ¶ 5.) GMACM transferred servicing rights to the Loan to Ocwen Loan Servicing, LLC ("Ocwen") on February 16, 2013. (Id.)
Eboweme defaulted on the Loan in May 2005. (Id. ¶ 6.) On May 4, 2005, Homecomings sent Eboweme a notice of default advising her of the amount due on the Loan and the consequences of not curing the default. (See id. Ex. 3-C.) Homecomings sent her similar notices of default on June 3, June 14 and July 5, 2005. (See id.) Eboweme again defaulted on the Loan in December 2006, prompting Homecomings to send her an additional notice of default on December 4, 2006. (See id.) Eboweme again defaulted on the Loan in March 2008, and notices of default were sent to her each month from March to September 2008. (See id. Ex. 3-D.)
In October 2008, Homecomings offered Eboweme a loan modification that would have reduced her monthly payment, offered an initial modified interest rate of 3%, and waived all outstanding late charges. Eboweme rejected this loan modification offer. (Priore Decl. ¶ 7.) In January 2009, Homecomings received a short sale package from Eboweme but the package was incomplete. (See id. ¶ 8.) Homecomings received the missing information from Eboweme on February 2, 2009. (See id.) Homecomings faxed Eboweme a letter approving the short sale; however, Eboweme called Homecomings and stated that she wished to pursue a loan modification instead of a short sale. (See id. ¶ 9.) On February12, 2009, Homecomings approved Eboweme for a traditional loan modification trial plan, but she rejected the plan stating that she could not afford the required trial plan payments. (Id. ¶ 10.)
On February 27, 2009, Eboweme filed a chapter 13 bankruptcy case (the "Chapter 13 Case") in the United States Bankruptcy Court for the Northern District of Texas (the "Texas Bankruptcy Court"). The Texas Bankruptcy Court confirmed Eboweme's chapter 13 plan on July 2, 2009. After Eboweme failed to make the March through July 2009 payments on the Loan, (see id. Ex. 7 at 4, 11), Bank of America, National Association, as successor by merger to LaSalle ("BOA"), filed two motions for relief from the automatic stay to proceed with foreclosure.7 (See Obj. ¶ 22). One motion was directed at Eboweme and the other motion was directed at a non-debtor co-borrower. (See id.)
On August 12, 2009, Eboweme sent GMACM a new loan modification workout package. GMACM denied the loan modification request on October 7, 2009 because Eboweme had insufficient income.
For unexplained reasons, the bankruptcy court did not hear BOA's two motions for relief from the automatic stay until August 30, 2010. The court granted BOA's motion to lift the automatic stay against Eboweme's co-borrower on September 30, 2010 , and against Eboweme on February 14, 2011 .
On March 7, 2011, GMACM sent Eboweme a demand letter (the "Demand Letter," Priore Decl. Ex. 3-J), asserting that she failed to make timely Loan payments from September 2008 through March 2011 and demanding the outstanding amount of $39,346.75. (Priore Decl.¶ 13.) MERS, as nominee for Aegis and its successors and assigns, executed an assignment of deed of trust in favor of BOA on June 14, 2011 (the "BOA Assignment," Priore Decl. Ex. 3-K).8 (Priore Decl. ¶ 14.) On August 16, 2011, Eboweme was sent a notice of sale scheduling a foreclosure sale on September 6, 2011 (the "Notice of Sale," id. Ex. 3-L).9 (Priore Decl. ¶ 15.) The Property was sold at the foreclosure sale on September 6, 2011, and the foreclosure deed in favor of BOA was recorded on October 18, 2011. (See id. Ex. 3-M.) According to the Trust, Eboweme remains in possession of the Property. (Priore Decl. ¶ 15.)
Eboweme filed an action against GMACM and other non-debtor defendants in federal court in Texas on June 29, 2011. (Patterson Decl. ¶ 10.) She voluntarily dismissed the federal action on September 29, 2011. On March 6, 2012, Eboweme filed a petition in Texas state court (the "Petition," Patterson Decl. Ex. 4-A) naming GMACM, BOA, and other defendants. (See id.) The state court action was based on substantially the same allegations underlying the federal action and asserted the same causes of action. (Id. ¶¶ 4, 10.) Specifically, the Petition asserted causes of action for (i) wrongful foreclosure; (ii) intentional infliction of emotional distress ("IIED"); (iii) violations of the automatic stay; (iv) violations of RESPA; (vi) violations of the TDCPA; and (vii) violations of the TDTPA. (Id.) After GMACM filed its bankruptcy petition in May 2012, the automatic stay prevented the state court action from proceeding against GMACM, but the non-debtor defendants moved for summary judgmenton April 4, 2013.10 (See id. ¶ 5.) The Texas state court action remains pending against the non-debtor defendants. (Id. ¶ 9.) As explained below, the potpourri of claims that Eboweme has asserted against GMACM fail to state any claims on which relief may be granted.
Eboweme timely filed her Claim against GMACM on November 5, 2012. (Obj. ¶ 35.) Her proof of claim asserts a secured claim in the amount of $3 million and an administrative expense claim pursuant to section 503(b)(9) in the amount of $3 million plus the value of the Property, which is listed as $130,000. The asserted basis for the Claim is "fraudulent loan, wrongful[] foreclosure, [and] fraudulent interest rate." (Id. Ex. 1.)
The Debtors sent Eboweme a letter requesting additional information in support of the Claim (the "Request Letter"), which she responded to on June 21, 2013. (Id. ¶ 38.) In a letter attached to her response, she asserts that GMACM and non-debtors collectively pursued a wrongful foreclosure in violation of provisions of the TDCPA. (Id.) Eboweme claims the foreclosure violated the automatic stay in her bankruptcy cases. (Id.) Eboweme asserts that her Loan was made on terms she wanted to modify, but GMACM would not assent to the modification. (Id.) She alleges that GMACM pre-approved a loan modification in October 2008, which, she claims, she paid on time and in full. (Id.) She further alleges that she had no notice of the foreclosure and that the Debtors violated RESPA by not providing her "the mortgage servicing agreement" she requested. (Id.) Eboweme attaches several documents to her Request Letter response, including (i) an unexecuted adjustable rate loan modification agreement; (ii) a copy of the order granting BOA's motion for relief from the automatic stay asto Eboweme; and (iii) a copy of a letter she received in connection with the consent order entered with the Board of Governors of the Federal Reserve System (the "FRB"), the Federal Deposit Insurance Corporation, certain of the Debtors, including GMACM, and non-debtor affiliates Ally Financial Inc. and Ally Bank. (Id.)
The...
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