Tuan Anh Le v. Bank of N.Y. Mellon

• Decision Date: 23 December 2015
• Docket Number: Case No. 14-cv-01949-KAW
• Citation: 152 F.Supp.3d 1200
• Parties: Tuan Anh Le, Plaintiff, v. Bank of New York Mellon, et al., Defendants.
• Court: U.S. District Court — Northern District of California

152 F.Supp.3d 1200

Tuan Anh Le, Plaintiff,

v.Bank of New York Mellon, et al., Defendants.

Case No. 14-cv-01949-KAW

United States District Court, N.D. California.

Signed December 23, 2015

Matthew David Mellen, Eunji Cho, Jessica Galleta, Mellen Law Firm, San Mateo, CA, for Plaintiff.

Carissa M. Beecham, Thomas Andrew Woods, Stoel Rives LLP, Sacramento, CA, for Defendant.

ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

KANDIS A. WESTMORE, United States Magistrate Judge

On April 28, 2014, Plaintiff Tuan Anh Le filed this action against Defendants Select Portfolio Servicing, Inc. (“SPS”), Bank of New York Mellon (“BONY”), and Bank of America alleging breach of contract and violations of the California Homeowner Bill of Rights. After the dismissal of Bank of America, Plaintiff amended his complaint to allege six causes of action against SPS and BONY (collectively “Defendants”). Before the Court is Defendants' motion for summary judgment. (Defs.' Mot., Dkt. No. 75.)

On December 17, 2015, the Court held a hearing, and after careful consideration of the parties' arguments, and moving papers, and for the reasons set forth below, the Court GRANTS Defendants' Motion for Summary Judgment.

I. BACKGROUND

On February 9, 2006, Plaintiff Tuan Anh Le refinanced his mortgage loan, secured by a deed of trust, with America's Wholesale Lender for the Subject Property located at San Francisco, California. (Pl.'s Req. for Judicial Not., “RJN,” Dkt. No. 79-3, Ex. 1.) Thereafter, Defendant Bank of America became the lender of Plaintiff's mortgage loan. (Decl. of Tuan Anh Le, “Le Decl.,” Dkt. No. 79-1 ¶ 3.)

In August 2009, Plaintiff received a letter from Bank of America approving him for a loan modification, which would allow him to make interest-only payments until 2019. (Le Decl. ¶ 4, Ex. 1.) Pursuant to the Agreement, Plaintiff would make monthly, interest-only payments of $3,825.08 beginning on November 1, 2009 until October 1, 2019, at which point Plaintiff would be required to make principal and interest payments. (Le Decl. ¶ 5.) On September 3, 2009, Plaintiff signed and dated the Loan Modification Agreement in the presence of a notary and sent the signed Agreement to Bank of America using the enclosed address label. (Le Decl. ¶ 5, Ex. 2.) In October 2009, Plaintiff began making the interest-only payments pursuant to the agreement. (Le Decl. ¶ 6.) Thereafter, in December 2009, Plaintiff was sent a statement that his loan was past due, and that his monthly payment was higher than the amount remitted. Id.

On or around January 4, 2010, Plaintiff submitted a payment in the amount of $3,825.08, but that payment was returned in April 2011, because Bank of America stated that it did not represent a full loan payment. (Le Decl. ¶¶ 6-7, Ex. 5.) Ultimately, Plaintiff submitted a new loan modification application to Bank of America. (Le Decl. ¶ 8.)

Plaintiff stopped making loan payments in January 2011,¹ and has not made any payments since. (Dep. of Tuan Anh Le, “Defs.' Le Dep.,” Decl. of Carissa Beecham, “Beecham Decl.,” Ex. F at 48:1-25; Pl.'s Resp. to Req. for Admissions, Set One, “RFA,” Beecham Decl., Dkt. No. 75-1, Ex. D, Nos. 7-11.) Plaintiff testified that he stopped making payments, so that he could obtain a loan modification. (Defs.' Le Dep. at 47:1-25.)

On June 13, 2011, America's Wholesale Lender assigned all beneficial interest under the Deed of Trust to Defendant Bank of New York Mellon (“BONY”). (RJN, Ex. 2.)

On May 1, 2012, the servicing of Plaintiff's mortgage loan was transferred from Bank of America to Defendant Select Portfolio Servicing, Inc. (“SPS”). (Decl. of Brett Cline, “Cline Decl.,” ¶ 6.) Bank of America did not issue a determination on Plaintiff's loan modification application prior to the transfer. (Le Decl. ¶ 8.) SPS also did not provide a determination on the loan modification application previously submitted to Bank of America. (Le Decl. ¶ 9.)

On May 10, 2012, SPS sent Plaintiff a “Validation of Debt Notice” pursuant to the state and federal Fair Debt Collections Practices Acts, which stated that he owed an outstanding balance of $828,786.43 on his residential mortgage loan, and informing him that he had 30 days from receipt to contest the debt in writing, lest it be assumed valid. (Cline Decl. ¶ 8, Ex. B.) Plaintiff did not dispute the debt pursuant to the terms of the Notice. (Defs.' Le Dep. 79:12-80:14; Cline Decl. ¶ 9.)

On May 31, 2012, SPS sent Plaintiff a letter inviting him to apply for a loan modification. (Cline Decl. ¶ 10, Ex. C.) There is no record that Plaintiff responded. (Cline Decl. ¶ 11.) On July 10, 2012, SPS sent Plaintiff another letter requesting documents needed to begin review of his loan. (Cline Decl. ¶ 12, Ex. D.) On August 6, 2012, SPS sent Plaintiff a notice stating that he met “the criteria to apply for a new modification program” related to the National Mortgage Settlement. (Le Decl., Ex. 6.) The letter did not guarantee a modification, and explicitly stated that “if you qualify for this modification, any past due late fees will be waived, interest and advances that we paid on your behalf will be added to your principal balance, and your loan will be brought up to date.” Id. The letter included a checklist of required documents, with a submission date of September 5, 2012. Id.

On or about September 5, 2012, Plaintiff submitted a tax form and a “Proof of Income” document to SPS. (Cline Decl. ¶ 13; Le Decl. ¶ 11.) On September 10, 2012, SPS discussed the submission with Plaintiff, and informed him that the submission was incomplete. (Cline Decl. ¶ 13; Contact History Report, Cline Decl., Ex. A at 60.) Plaintiff concedes that SPS requested additional information in support of his application. (Le Decl. ¶ 11.) SPS did not receive any additional information, and the phone number provided by Plaintiff was disconnected, such that SPS did not reestablish phone contact until June 2013. (Contact History Report at 55-57; Cline Decl. ¶ 14.)

Plaintiff was assigned various single points of contact (“SPOC”) by SPS pursuant to the Homeowner Bill of Rights. On February 14, 2013, SPS assigned relationship manager Jared Johnson to Plaintiff's loan. (Le Decl. ¶ 12, Ex. 7.) On April 9, 2013, SPS changed Plaintiff's assigned relationship manager to Jacquelyn Collins. (Le Decl. ¶ 12, Ex. 8.) Plaintiff contacted SPS, but was unable to reach his assigned relationship managers. (Le Decl. ¶ 12.) Plaintiff was able, however, to discuss his loan and modification options with other SPS personnel. (See Contact History Report at 51-55; Le Decl. ¶ 16.) Plaintiff contends that the representatives provided him with conflicting information. (Le Decl. ¶ 16.)

On May 30, 2013, SPS sent Plaintiff another loan modification solicitation letter. (Le Decl. ¶ 13, Ex. 9.) The letter stated that “[i]f you qualify for this modification, any past due late fees will be waived, interest and advances that we paid on your behalf will be added to your principal balance, principal reduction will be applied and your loan will be brought up to date.” Id. It did not guarantee a loan modification. Id. On June 17, 2013, Plaintiff received another loan modification solicitation letter from SPS. (Le Decl. ¶ 13, Ex. 10.)

On June 18, 2013, with the assistance of Christine Nguyen from Asian, Inc., Plaintiff resubmitted the documents for his loan modification application to SPS. (Le Decl. ¶ 14.)

On June 19, 2013, SPS sent Plaintiff a notice acknowledging that he had begun the home loan modification process, and that he would be notified by letter if his application was missing any documents. (Le Decl., Ex. 11.)

On or around July 8, 2013, the requested paystubs and proof of occupancy were submitted to SPS. (Contact History Report at 53.) The paystubs provided did not provide the information required, which was conveyed to Christine Nguyen. (7/12/13 entry, Contact History Report at 53.) The SPS representative also requested new copies of the paystubs, which Plaintiff submitted. (Contract History Report at 51.)

Plaintiff was sent letters on June 24, July 24,² and July 26, 2013, indicating that necessary documents were still missing and that the documents needed to be submitted by July 24, August 8, and August 10, 2013. (Cline Decl. ¶¶ 15-20, Exs. E, G.) Plaintiff did not submit the requested documents by those deadlines. (Cline Decl. ¶21.)

On July 31, 2013, SPS, via a new assigned relationship manager Jerry Stanley, informed Plaintiff that his loan modification application was being evaluated. (Le Decl. ¶ 17, Ex. 14.) On August 16, 2013, SPS issued a letter stating that Plaintiff's loan was not eligible for the new principal forgiveness modification program based on the monthly income of $5,382.36. (Le Decl. ¶ 18; Ex. 15.) The letter provided Plaintiff with 30 days to contact SPS to “provide information to show why our determination of eligibility was in error.” (Le Decl., Ex. 15 at 1.) The letter also stated that there may be other modification options. Id .

As Plaintiff's income had increased from the amount used in the loan modification calculation, Plaintiff contacted SPS with the help of Asian, Inc., and was informed that he may be evaluated under different loan modification programs. (Le Decl. ¶ 18.) On or around October 16, 2013, SPS sent information regarding the Home Affordable Modification Program (“HAMP”), along with the application and instructions to submit the application by no later than November 15, 2013. (Le Decl. ¶ 19, Ex. 16.) Plaintiff, with the assistance of the National Asian American Coalition (“NAAC”), submitted a new loan modification application that reflected the change in his income. (Le Decl. ¶ 19.)

On October 31, 2013, SPS denied Plaintiff's loan modification application on the grounds that his loan did not meet one or more of the HAMP eligibility criteria. (Le Decl. ¶ 20, Ex. 17.) Specifically, the letter stated that the unpaid principal balance was higher than the program limit. Id. It also provided that “[y]ou have 30 calendar...