Miller v. Chase Home Fin., LLC

• Decision Date: 19 April 2012
• Docket Number: No. 11–15166Non–Argument Calendar.,11–15166Non–Argument Calendar.
• Citation: 23 Fla. L. Weekly Fed. C 948,677 F.3d 1113
• Parties: Jason A. MILLER, Plaintiff–Appellant, v. CHASE HOME FINANCE, LLC, Defendant–Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

23 Fla. L. Weekly Fed. C 948

677 F.3d 1113

Jason A. MILLER, Plaintiff–Appellant,

v.CHASE HOME FINANCE, LLC, Defendant–Appellee.

No. 11–15166Non–Argument Calendar.

United States Court of Appeals, Eleventh Circuit.

April 19, 2012.

Peter Comstock Ensign, Law Office of Peter C. Ensign, Chattanooga, TN, for Plaintiff–Appellant.

Julie C. Jared, Shanon J. McGinnis, Lindsay A. Warren, Wargo & French, LLP, Kent Edward Altom, Emilie Omer Denmark, Jimmy Thomas Howell, Jr., McCalla Raymer, LLC, Atlanta, GA, for Defendant–Appellee.

Appeal from the United States District Court for the Northern District of Georgia.

Before CARNES, WILSON and KRAVITCH, Circuit Judges.

PER CURIAM:

Jason A. Miller appeals from an order of the district court dismissing his complaint for failure to state a claim. After a thorough review of the record and briefs, we affirm.

I.

Miller owned a parcel of real property in Hiawassee, Georgia, which he obtained by securing a mortgage loan from the predecessor of the defendant, Chase Home Finance, LLC (Chase). In February 2009, Miller requested a loan modification from Chase, citing financial difficulties. Chase agreed to temporarily modify the terms of Miller's loan agreement, but in August 2010, Chase notified Miller that it would not extend a permanent loan modification to him.

Consequentially, Miller filed suit, alleging that Chase failed to comply with its obligations under the federal Home Affordable Modification Program (HAMP) by declining to issue him a permanent loan modification. According to Miller, this failure gave rise to claims for (1) breach of contract, (2) breach of the implied covenant of good faith and fair dealing, and (3) promissory estoppel. The district court dismissed Miller's complaint for failure to state a claim, finding that HAMP does not provide a private cause of action and that, even if his claims were independent of HAMP, they failed as a matter of law.¹ Miller appeals.

II.

We review the district court's dismissal for failure to state a claim, including its legal conclusion that HAMP does not provide a private right of action, de novo. See Love v. Delta Air Lines, 310 F.3d 1347, 1351 (11th Cir.2002) (applying de novo review to determine whether a statute creates a private right of action); McKusick v. City of Melbourne, Fla., 96 F.3d 478, 482 (11th Cir.1996) (“ De novo review applies to grants of motions to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted.”). The parties agree that Georgia substantive law governs any part of Miller's claims independent of HAMP.

III.

During the economic crisis of 2008, Congress passed the Emergency Economic Stabilization Act of 2008 (EESA), 12 U.S.C. §§ 5201–5261. EESA charges the Secretary of the United States Department of the Treasury with acting in a manner that “preserves homeownership and promotes jobs and economic growth.” Id. § 5201(2)(B). To this end, the Department of the Treasury created the Making Home Affordable Program, a program that included HAMP.

HAMP is designed to prevent avoidable home foreclosures by incentivizing loan servicers to reduce the required monthly mortgage payments for certain struggling homeowners. Servicers are obliged to abide by guidelines promulgated by the Secretary when determining a mortgagor's eligibility for a permanent loan modification. U.S. Dep't of Treasury, Making Home Affordable Program, Handbook for Servicers of Non–GSE Mortgages at 27 (Dec. 15, 2011). To assure that servicers comply with the guidelines, the Secretary designated Freddie Mac to conduct compliance assessments of HAMP participants. Id. Neither HAMP nor EESA expressly creates a private right of action for borrowers against loan servicers.

This court has not addressed, in a published opinion, whether there is an implied private right of action under HAMP. In determining whether such a remedy exists, this court considers the following questions:

(1) is the plaintiff one of the class for whose especial benefit the statute was enacted; (2) is there any indication of legislative intent, explicit or implicit, either to create such a remedy or to deny one; (3) is it consistent with the underlying purposes of the legislative scheme to imply a remedy for the plaintiff; and (4) is the cause of action one traditionally relegated to state law, in an area basically the concern of the States, so that it would be inappropriate to infer a cause of action based solely on federal law.

Hemispherx Biopharma, Inc. v. Johannesburg Consol. Inves., 553 F.3d 1351, 1362 n. 14 (11th Cir.2008) (internal quotation marks omitted).

When we apply these factors to HAMP and EESA, it is clear that no implied right of action exists. First, EESA and HAMP were designed to “provide authority and facilities that the Secretary of the Treasury can use to restore liquidity and stability to the financial system of the United States.” 12 U.S.C. § 5201(1). EESA was not passed for the “especial benefit” of struggling homeowners, even though they may benefit from HAMP's incentives to loan servicers.

Second, there is no discernible legislative intent to create a private right of action; in fact, the legislature gave the Secretary the right to initiate a cause of action, via the Administrative Procedure Act. Id. § 5229(a)(1). Third, providing a private right of action against mortgage servicers contravenes the...