Rodriguez v. Countrywide Homes
| Decision Date | 12 November 2009 |
| Docket Number | No. 1:08cv0869 DLB.,1:08cv0869 DLB. |
| Citation | 668 F.Supp.2d 1239 |
| Court | U.S. District Court — Eastern District of California |
| Parties | Leonel RODRIGUEZ and Maria Del Carmen Soto, Plaintiff, v. COUNTRYWIDE HOMES, et al., Defendants. |
Kimberly L. Mayhew, Caswell Bell and Hillison LLP, Fresno, CA, for Plaintiff.
Kamao C. Shaw, Nafiz Cekirge, Bryan Cave LLP, Santa Monica, CA, Sanford P. Shatz, In-House Litigation, Calabasas CA, Ronald D. Roup, Roup & Associates, A Law Corporation, Lake Forest, CA, for Defendants.
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY ADJUDICATION AS TO THE FIRST AND SECOND CAUSES OF ACTION (Document 34)
ORDER REQUIRING PLAINTIFFS TO FILE DISMISSAL DOCUMENTS AS TO THE THIRD AND FOURTH CAUSES OF ACTION
Defendant Countrywide Home Loans, Inc. ("Countrywide") filed the instant motion for summary judgment, or summary adjudication in the alternative, on September 11, 2009. The matter was heard on October 30, 2009, before the Honorable Dennis L. Beck, United States Magistrate Judge. Nafiz Cekirge appeared on behalf of Countrywide. Kimberly Mayhew appeared for Plaintiffs Leonel Rodriguez and Maria Del Carmen Soto ("Plaintiffs").
Plaintiffs filed the instant complaint in the Fresno County Superior Court on May 14, 2008. The action was removed to this Court on June 19, 2008. Plaintiffs named Countrywide, Litton Loan Servicing Inc. ("Litton"), and Mortgage Electronic Registration System, Inc. ("MILA") as Defendants, and allege causes of action for (1) violation of the Real Estate Settlement Procedure Act ("REPSA"), 12 U.S.C. § 2601, et seq.; (2) violation of California Civil Code section 2937; (3) wrongful foreclosure; and (4) violation of California Business and Profession Code section 17200, et. seq. The causes of action are based on Plaintiffs' allegation that Countrywide failed to send them a notice of transfer of servicing letter to their mailing address.
Plaintiffs filed a notice of settlement with Defendants Litton and MILA on September 21, 2009, and filed a request for dismissal on November 5, 2009.
Countrywide filed the instant motion for summary judgment/summary adjudication on September 11, 2009.
Plaintiffs filed their opposition on September 22, 2009. While Plaintiffs addressed the RESPA and California Civil Code section 2937 on the merits, they conceded that the wrongful foreclosure claim and the claim for restitution under section 17200 cannot be maintained against Countrywide. Plaintiffs indicate that they will move to dismiss these two causes of action.
Countrywide filed its reply on October 23, 2009.
In June 2006, Plaintiffs refinanced an existing mortgage and obtained a loan from MILA. Undisputed Material Fact ("UMF") 1. The loan secures an interest in property located at 16688 2nd Street, Huron, CA, 93234 (the "Property Address"). UMF 2. Plaintiff Rodriguez was listed as the only borrower and his was the only signature on the Loan Application, dated June 28, 2006. Plaintiff Soto was not listed as a co-borrower. UMF 3, 4. The Loan Application indicated that title would be held jointly in both Rodriguez and Soto's name. UMF 10. The Balloon Payment Rider is signed by both Rodriguez and Soto. UMF 7. Based on Soto's interest in the property, both Rodriguez and Soto executed the Deed of Trust. UMF 11.
On the first page of the Loan Application, there is a slot entitled, "Present Address." UMF 12. That slot contains the Property Address. UMF 13. Below that slot, there is a separate space entitled, "Mailing Address, if different from Present Address." UMF 14. That space is blank and does not contain Plaintiffs' P.O. Box Address. UMF 15. In fact, Plaintiffs' P.O. Box Address does not appear anywhere on the Loan Application. UMF 16.
Each Truth In Lending Act Disclosure Statement lists the Property Address as both the "Mailing Address" and "Property Address." The P.O. Box Address does not appear anywhere on these Disclosures. UMF 19. Both Rodriguez and Soto also executed a Notice of Right to Cancel under the Truth in Lending Act. UMF 20. The Notice lists the Property Address as both the "ADDRESS" and "PROPERTY," and the P.O. Box Address is not listed anywhere on the Notice. UMF 21, 22.
Plaintiffs executed these loan documents knowing that the United States Post Office does not deliver to the Property Address that Plaintiffs listed as their mailing address because the property is in a rural area. UMF 23. Soto testified that she has had this P.O. Box for 30 years and she knew to provide other lenders with the P.O. Box Address. UMF 24, 25.
Although they could not read English, Plaintiffs both testified and demonstrated at their deposition that they were able to identify addresses on the loan documents. UMF 26. Soto commented that it was "strange" that the P.O. Box Address was not on her loan documents because Plaintiffs "use[d] the P.O. Box for everything." UMF 27.
During the time that Countrywide serviced the loan, a borrower could change his mailing address in writing or by telephone by providing certain information. UMF 29, 30. In September 2007, after Countrywide service-released the Loan but while Plaintiffs were still sending their payments to Countrywide, the policy to update a mailing address changed slightly. UMF 31, 32, 33. Despite these changes, a specific request to change the mailing address was still required. UMF, 34.
In addition, the Deed of Trust and Note also set forth procedures for a borrower to change a mailing address. Paragraph 15 of the Deed of Trust states that the notice address for all notices given by the lender in connection with the Deed of Trust shall be the Property Address unless the borrower designates a separate address in writing. UMF 35. It also states that if a lender has specified a procedure for changing the Property Address as the notice address under the Deed of Trust, a borrower may only change his address through that procedure. UMF 36. Similarly, Paragraph 7 of the Note states that the notice address under the Note is the Property Address, unless the borrower informs the lender of a change of address by first class mail. UMF 37.
A borrower must expressly request that Countrywide change the mailing address on his or her account. UMF 38. Simply putting an address on a money order does not constitute a request for an address change. UMF 39. Countrywide accepts payments from people other than the borrower, such as family members. UMF 40. The address on a money [order] is not necessarily the borrower's. UMF 41.1
Rodriguez testified that he was completely uninvolved with the Loan. UMF 42. He had no written or oral communications with Countrywide and he did not ask anyone to call Countrywide on his behalf. UMF 43. Neither Soto nor anyone acting on her behalf ever requested that Countrywide change the mailing address on the Loan from the Property Address to the P.O. Box Address. UMF 44. Rodriguez never communicated with Litton and Soto never notified Litton that their Mailing Address was different than their Property Address. UMF 46, 47.
On July 26, 2006, Countrywide began servicing the Loan and sent Rodriguez a Welcome Letter at his Property Address. UMF 48. The Welcome Letter was returned to Countrywide on August 3, 2006. UMF 49. Countrywide serviced the loan for only two months. UMF 50. In connection with the transfer of servicing to Litton, Countrywide sent a Good Bye Letter to Plaintiffs at their Property Address on September 8, 2006. UMF 51. The Good Bye Letter informed Plaintiffs that effective October 1, 2006, Litton would be serving the Loan. UMF 52. The Good Bye Letter was returned to Countrywide as undeliverable on September 27, 2006. UMF 53.
Per Countrywide internal policies and procedures, once mail is returned, it will examine certain documents to see if an alternate address is available in the files. The primary document in determining a borrower's mailing address is the loan application, "due to the application having the property address as well as mailing address if different." UMF 54. Countrywide will also check a borrower's deed of trust and note for a mailing address. UMF 55. In addition, Countrywide will check to see if there is correspondence from the borrower requesting an address change. UMF 56.
Here, the Loan Application, Deed of Trust and Note only contain the Property Address as the Mailing Address. UMF 57, 58, 59. Plaintiffs never requested that Countrywide change their Mailing Address from the Property Address to the P.O. Box. UMF 60.
Soto was expecting to receive coupons or statements from Countrywide and thought it was "strange" that she was not receiving correspondence from Countrywide. UMF 65. The Payment Letter that both Plaintiffs signed expressly informed them that their Loan may be service-released and provided a toll free number for them to call. UMF 66. Soto demonstrated at her deposition that she could identify telephone numbers on English documents. UMF 67. Soto testified that she did not remember why she did not call the toll free number. UMF 69. Had she called, she could have spoken to someone in Spanish. UMF 70.
After Countrywide service-released the Loan to Litton, Soto continued making Loan payments to Countrywide. UMF 71. Rodriguez, the borrower on the account, did not make any payments. UMF 72. [The payments] did not bear the account number or Property Address the only address associated with the account. UMF 74, 75.2 Only one payment, from September 2007 (comprised of two money orders) appears to have had a coupon attached to it. UMF 76. All of the identifying features on Soto's payments, such as the account number, property address and borrower's name, were placed there by Countrywide employees after they completed their research. UMF 77.
Countrywide received 13 payments associated with the Loan after the service-release. UMF 81. Purely for customer service reasons, Countrywide had a policy of forwarding service-released...
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