Peters-Humes v. Lafayette Fed. Credit Union
| Docket Number | 184-2022 |
| Decision Date | 28 August 2023 |
| Parties | NICOLE M. PETERS-HUMES v. LAFAYETTE FEDERAL CREDIT UNION, ET AL. |
| Court | Court of Special Appeals of Maryland |
UNREPORTED [*]
IN THE APPELLATE COURT OF MARYLAND [**]
Circuit Court for Frederick County Case No. C-10-CV-20-000551
This appeal arises from a deficiency action brought in the Circuit Court for Frederick County by Appellee, Lafayette Federal Credit Union ("LFCU"), against Appellant, Nicole Peters-Humes ("Peters-Humes"), and George Humes. Peters-Humes responded, originally filing a motion to dismiss, which was denied. Thereafter, Peters-Humes filed an answer and counterclaims against LFCU and other defendants. At a subsequent hearing, the circuit court dismissed all of Peters-Humes counterclaims, except for the claim alleging LFCU violated the Maryland Consumer Protection Act ("MCPA"). The court asked both parties to provide additional briefing regarding the statute of limitations for the MCPA claim. Both parties submitted such briefing and presented oral arguments on the issue at a hearing on February 28, 2022, in which the court ruled that Peters-Humes's claim was time barred. On March 1, 2022 the court memorialized this ruling in an order dismissing the case. Peters-Humes timely appealed this ruling.
Peters-Humes presents two questions for our review, which we condense and rephrase into the lone inquiry of whether the circuit court erred in ruling that Peters-Humes counterclaims were time barred.[1] For the reasons explained herein, we reverse the circuit court's dismissal as to Peters-Humes's MCPA claim and remand to the circuit court to adjudicate that claim.
On May 28, 2004, Peters-Humes and George Humes, as borrowers/mortgagors, and LFCU, as lender/mortgagee, entered an Adjustable-Rate Balloon ("ARM") note for $486,000 secured by real property owned by Peters-Humes and Humes located in Bowie, Maryland ("the Subject Property") in Prince George's County. On the same day, Peters-Humes and Humes entered into a fixed loan agreement issued by LFCU for $50,000. On May 9, 2005, Peters-Humes entered into an adjustable-rate loan issued by LFCU for $628,000, which was secured by the Subject Property. A deed of trust for the Subject Property filed May 25, 2006 shows the new loan paid off the original loan.
Peters-Humes claimed to have been a customer of LFCU's since 1998, financing automobile, student, and other loans with the credit union in addition to the loans at the center of this dispute. She assumed she would be able to modify her 2005 loan, if needed, based on her long-standing relationship with LFCU and communications with LFCU personnel, including Renee Thompson ("Thompson"), in which Peters-Humes alleged she was told LFCU would be amenable to subsequent modifications. In June of 2015, Peters-Humes claimed she communicated to Thompson the desire to refinance the loan, but no such modification occurred.
In 2016, Peters-Humes and Humes defaulted on the note and the terms of the deed of trust. On March 8, 2017, LFCU filed for foreclosure in the Circuit Court for Prince George's County. In November 2017, Peters-Humes filed for Chapter 13 bankruptcy. Her bankruptcy proceeding was dismissed without discharge on September 13, 2018.
In April 2017, Peters-Humes claimed she again sought to modify the loan, submitting a modification application on her own and then doing the same a month later with the assistance of a Department of Housing and Urban Development Housing Counselor. Peters-Humes received no response to either request. LFCU and Peters-Humes attended foreclosure mediation on September 25, 2017, at which point LFCU informed Peters-Humes that no such modification would occur. The mediator filed the mediation report on September 28, 2017.
On July 31, 2018, the Subject Property was sold in a foreclosure sale. The Circuit Court for Prince George's County ratified the sale on November 21, 2018. Diana C. Theologou ("Theologou"), as Trustee under the Deed of Trust, filed the suggested account on December 7, 2018. That court ratified the foreclosure audit on January 25, 2019.
Despite claiming she did not receive notice of the foreclosure or the sale, neither Peters-Humes nor Humes filed exceptions or otherwise challenged the foreclosure proceedings prior to ratification. Though Peters-Humes decried the lack of notice, she admitted during a later hearing that she did not inform the court of her change of address.
Following the ratification of the sale, Peters-Humes left Maryland for Oklahoma to attend the funeral of her brother-in-law in August 2018. Upon her return in late September, she allegedly found the locks on the Subject Property had been changed. She further discovered that many of her personal belongs had been moved to the garage or damaged, contractors were in the process of renovating, and it appeared new parties were residing at the Subject Property.
On October 19, 2020, LFCU filed in the Circuit Court for Frederick County a two-count complaint for breach of contract, alleging Peters-Humes and Humes defaulted on debts of $40,080.55 and $290,864.18, respectively and thus was entitled to the balance of those debts plus interest and fees. On February 5, 2021, Peters-Humes filed an answer, along with numerous counterclaims against LFCU. On March 25, 2021, Peters-Humes filed an Amended Counterclaim asserting claims against the appellees in this dispute --LFCU and its subsidiary Preferred Business XChange d/b/a PBX Settlement Services, LLC, as well as Theologou and Thompson -- alleging: (1) fraud; (2) breach of contract; (3) negligence per se; (4) abuse of process; (5) infliction of emotional and mental distress; (6) violations of the Maryland Consumer Protection Act; (7) satisfaction of debt; (8) declaratory relief; and (9) unjust enrichment. The appellees subsequently filed motions to dismiss, and the Circuit Court for Frederick County held a hearing regarding those motions on May 26, 2021.
During the hearing, the circuit court determined that nearly all, if not all, of Peters-Humes's counterclaims were barred by either the statute of limitations or as a matter of res judicata due to their correlation to the foreclosure action that was since ratified by the Circuit Court for Prince George's County. At the conclusion of the hearing, the court ruled from the bench that the statute of limitations had run on all claims against all parties except the MCPA claim against LFCU. An order issued May 27, 2021 memorialized this ruling and dismissed the all claims and parties other than the MCPA claim against LFCU.
During the May 26, 2021 hearing, the court surmised that -- assuming Peters-Humes's MCPA claim was based on LFCU and its employees allegedly inducing Peters-Humes to enter the loan by misleading her into thinking she could modify the loan later -Peters-Humes would have discovered she had been misled by the time the bank filed for foreclosure because, by this point, it would be obvious that no modification would occur. As such, she would have been "on notice" of the potential MCPA claim "at the latest September 28, 2017." The court asked parties for additional briefing regarding just the statute of limitations issues related to the MCPA claim, which the parties dutifully submitted, along with competing motions in response, in late May and early June of 2021.
The court held another hearing on February 28, 2022, strictly on the statute of limitations arguments regarding the MCPA. The court ruled that, due to the three-year limitations period for MCPA claims, Peters-Humes's claim was time barred, even with the tolling of all statutes of limitations during the statewide court closures prompted by the COVID-19 pandemic. The court issued an order on March 1, 2022 dismissing the remaining MCPA claim against LFCU. Peters-Humes filed her timely appeal to on March 30, 2022.
"We review the grant of a motion to dismiss to determine 'whether the trial court was legally correct.'" Hancock v. Mayor &City Council of Balt., 480 Md 588, 603 (2022) (quoting D.L. v. Sheppard Pratt Health Sys., Inc., 465 Md. 339, 350 (2019)). "We do so without deference to the trial court," however we "assume the truth of all relevant and material facts that are well pleaded and all inferences which can reasonably be drawn from those pleadings." Id. (quoting Wheeling v. Selene Fin. LP, 473 Md. 356, 374 (2021)). "Motions to dismiss are generally granted in cases where 'there [is] no justiciable controversy[.]'" Litz v. Md. Dep't of Env't, 434 Md. 623, 641 (2013) (quoting Broadwater v. State, 303 Md. 461, 467 (1985)). Therefore, "[a] motion to dismiss may be granted only 'where the allegations presented do not state a cause of action.'" Hancock, supra, 480 Md at 603 (quoting Wheeling v. Selene Fin. LP, 473 Md. 356, 374 (2021)).
Ordinarily a motion to dismiss should not be granted by a trial court solely based on the assertion that the "cause of action is barred by the statute of limitations[,] unless it is clear from the facts and allegations on the face of the complaint that the statute of limitations has run." Rounds v. Md.-Nat'l Cap. Park &Plan. Comm'n, 441 Md. 621, 655 (2015) (quoting Litz v. Md. Dep't of the Env't, 434 Md. 623, 641 (2013)). Depending on the nature of the claims being made, determining whether the action is time barred may be a question solely of law, solely of fact, or of both law and fact. Doe v. Archdiocese of Wash., 114 Md.App. 169, 178 (1997). When the determination "hinges on a question of fact, however, the factual question is ordinarily resolved by the jury, rather...
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