Jacob v. Bac Home Loans Servicing, LP
| Decision Date | 26 May 2015 |
| Docket Number | No. 7:14-CV-036-DAE,7:14-CV-036-DAE |
| Court | U.S. District Court — Western District of Texas |
| Parties | CESAR JACOB and SALLY CHAVEZ, Plaintiffs, v. BAC HOME LOANS SERVICING, LP F/K/A COUNTRYWIDE HOME LOANS SERVICING LP; ALL PERSONS UNKNOWN, CLAIMING ANY LEGAL OR EQUITABLE TITLE, RIGHT, LIEN, OR INTEREST IN THE PROPERTY DESCRIBED IN THE COMPLAINT ADVERSE TO PLAINTIFF'S TITLE, OR ANY CLOUD ON PLAINTIFF'S TITLE THERETO, Defendants. |
Before the Court are a Motion for Summary Judgment filed by Defendant Bank of America, N.A. ("Defendant")1 (Dkt. # 21) and various Motions for Relief filed by Plaintiffs Cesar Jacob and Sally Chavez (collectively, "Plaintiffs") (Dkts. ## 25, 30, 31). Pursuant to Local Rule CV-7(h), the Courtfinds these matters suitable for disposition without a hearing. After reviewing the Motions and the opposing memoranda, for the reasons that follow, the Court GRANTS Defendant's Motion for Summary Judgment (Dkt. # 21) and DENIES Plaintiffs' Motions for Relief (Dkts. ## 25, 30, 31).
On July 19, 2007, Plaintiff Cesar Jacob ("Jacob") executed and delivered a Texas Home Equity Note (the "Note") in favor of Countrywide Home Loans, Inc. Pursuant to the terms of the Note, Jacob agreed to pay the principal sum of $81,000.00, with an interest rate of 12% per annum, in monthly installments of $833.18 each. The payments were to begin on September 1, 2007, and continue each month thereafter until paid or until August 1, 2037, at which time the Note matures. In connection with the extension of credit evidenced by the Note, Jacob and Plaintiff Sally Chavez ("Chavez") (collectively, "Plaintiffs") executed a Texas Home Equity Security Instrument (the "Security Instrument") securing the Note by a lien against the property located at 1103 E. 49th Street, Odessa, Texas, 79762 (the "Property"). (Kearse Decl. ¶ 4; Dkt. # 21, Ex. B.)
On June 22, 2011, Mortgage Electronic Registration Systems, Inc. ("MERS"), as nominee for Countrywide Home Loans, Inc., assigned the SecurityInstrument and the Note to BAC Home Loans Servicing, LP f/k/a Countrywide Home Loans Servicing, LP. The assignment was recorded in the real property records on July 1, 2011. (Kearse Decl. ¶ 4; Dkt. # 21, Ex. C.) By virtue of a corporate merger, Defendant became the successor-by-merger to BAC Home Loans Servicing, LP f/k/a Countrywide Home Loans Servicing, LP. (Kearse Decl. ¶ 4; Dkt. # 21, Ex. D.) On May 6, 2014, Defendant assigned the Security Instrument and the Note to Christiana Trust, a division of Wilmington Savings Fund Society, not in its individual capacity but as Trustee of ARLP Trust 4 ("Christiana Trust"). The assignment was recorded in the real property records on June 2, 2014. (Kearse Decl. ¶ 4; Dkt. # 21, Ex. E.) Consequently, Christiana Trust is the current owner and holder of the Note and the record holder of the lien, and Defendant no longer holds any interest in the Note or the Property. (Kearse Decl. ¶ 4.)
Defendant serviced the Note until October 1, 2012, when servicing transferred to Ocwen Loan Servicing, LLC ("Ocwen"). (Kearse Decl. ¶ 4; Dkt. # 21, Exs. A-2, A-3, A-4, A-5.) Ocwen currently services the loan on behalf of Christiana Trust. (Kearse Decl. ¶ 4.) Plaintiffs became delinquent in the payment of the Note when they failed to pay the installment due on April 1, 2011, and all installments due thereafter. (Kearse Decl. ¶ 4; Dkt. # 21 Exs. A-2, A-3.)
On March 19, 2014, Plaintiffs filed a Complaint for Declaratory Relief, Quiet Title, and Preliminary and Permanent Injunctive Relief in the 244th Judicial District Court of Ector County, Texas. (Dkt. # 1-1.) On May 26, 2014, Defendant removed the case to this Court, invoking this Court's diversity jurisdiction. (Dkt. # 1.)
On September 23, 2014, at the direction of Judge Robert A. Junell, Plaintiffs filed an Amended Complaint alleging various violations of federal and state law. ("Am. Compl.," Dkt. # 14.) Specifically, Plaintiffs allege the following: (1) breach of contract, (2) breach of the duty of good faith and fair dealing, (3) fraud, (4) violations of § 51.901 of the Texas Government Code, (5) civil conspiracy, and (6) violations of the Texas Deceptive Trade Practices Act. (See id.) Plaintiffs also seek a declaratory judgment and an order quieting title. (Id. at 10.)
On October 7, 2014, Defendant filed a Motion to Dismiss for Failure to State a Claim. (Dkt. # 15.) On November 4, 2014, Judge Junell entered an Order to Construe Defendant's Motion to Dismiss as a Summary Judgment Motion. (Dkt. # 16.) Judge Junell noted that Defendant had referenced a Certificate of Corporate Merger in its Motion to Dismiss, which the Court would take into account when ruling on the Motion. Because Plaintiffs representthemselves pro se and likely were not on notice that the Court could convert the Motion to Dismiss into a Motion for Summary Judgment, the Court gave Plaintiffs notice of its intent to construe the Motion as one for summary judgment, and gave them a reasonable opportunity to respond with their own evidence. (Id. at 4.)
On December 15, 2014, Defendant filed the instant Motion titled "Supplemental Motion to Dismiss for Failure to State a Claim." (Dkt. # 21.) In light of Judge Junell's Order, Defendant amended its Motion to move for summary judgment as to all of Plaintiffs' claims, and supplemented the Motion with additional evidence. (Id. at 1.) Consistent with Judge Junell's Order, the Court construes the instant Motion as a Motion for Summary Judgment.
On January 28, 2015, Plaintiffs filed an untimely Response in Opposition. (Dkt. # 25.) Within their Response, Plaintiffs moved to "strike [Defendant's] opposition for want of standing" and additionally moved to "substitute Christiana Trust, a division of Wilmington Savings Fund Society, FSB, not in its individual capacity but as a trustee of ARLP Trust 4." (Id.) On May 14, 2015, Plaintiffs filed a Motion to Compel Discovery. (Dkt. # 30.) On the same day, Plaintiffs also filed another document with the Court in which they asked the Court to sanction Defendant and remand this action to state court so that Plaintiffs could amend their complaint to sue Christiana Trust. (Dkt. # 31.)
Summary judgment is proper where the evidence demonstrates "that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a); Cannata v. Catholic Diocese of Austin, 700 F.3d 169, 172 (5th Cir. 2012). A dispute is only genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The moving party bears the initial burden of demonstrating the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party meets this burden, the nonmoving party must come forward with specific facts that establish the existence of a genuine issue for trial. Distribuidora Mari Jose, S.A. de C.V. v. Transmaritime, Inc., 738 F.3d 703, 706 (5th Cir. 2013) (quoting Allen v. Rapides Parish Sch. Bd., 204 F.3d 619, 621 (5th Cir. 2000)). "Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no 'genuine issue for trial.'" Hillman v. Loga, 697 F.3d 299, 302 (5th Cir. 2012) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)).
In deciding whether a fact issue has been created, the court must draw all reasonable inferences in favor of the nonmoving party, and it "may not make credibility determinations or weigh the evidence." Tiblier v. Dlabal, 743 F.3d1004, 1007 (5th Cir. 2014) (quoting Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000)). However, "[u]nsubstantiated assertions, improbable inferences, and unsupported speculation are not sufficient to defeat a motion for summary judgment." United States v. Renda Marine, Inc., 667 F.3d 651, 655 (5th Cir. 2012) (quoting Brown v. City of Hous., 337 F.3d 539, 541 (5th Cir. 2003)).
Defendant argues that summary judgment is appropriate because Defendant is no longer the owner and holder of the Note and the Security Instrument. (Dkt. # 21 at 2.) Defendant states that Christiana Trust is the current owner and holder of the Note and the Security Instrument. (Id.) Defendant argues that because no justiciable controversy exists between the parties, Plaintiffs cannot obtain the relief they seek from Defendant, and that summary judgment consequently must be granted for Defendant on all of Plaintiffs' claims. (Id.) In the alternative, Defendant argues that Plaintiffs' claims fail as a matter of law for numerous reasons. (Id. at 2-3.) Because this case comes before the Court on the basis of diversity jurisdiction, the Court applies Texas substantive law to the following analysis. 28 U.S.C. § 1332; Westerman v. Sears, Roebuck & Co., 577 F.2d 873, 879 (5th Cir. 1978) (citing Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938)). The Court addresses each of Plaintiffs' claims below.
Plaintiffs allege that Defendant breached the loan agreement by imposing improper fees, imposing forced place insurance on the Property, accelerating the interest rate, concealing the true owner and holder of the Note and mortgage, and demanding payments and late fees that were not actually owed, among other allegedly wrongful acts. (Am. Compl. ¶¶ 10-12.) The elements of a breach of contract claim under Texas law are: (1) the existence of a valid contract, (2) performance by the plaintiff, (3) breach of contract by the defendants, and (4) damages to the plaintiff resulting from the breach. Smith Int'l, Inc. v. Eagle Grp., 490 F.3d 380, 387 (5th Cir. 200...
To continue reading
Request your trial