In McFarland v. Wells Fargo Bank, N.A., 14-2126 (4th Cir. Jan. 15, 2016), the Fourth Circuit Court of Appeals examined the argument that a loan was substantively unconscionable because it vastly exceeded the worth of the residential property by which it was secured. The case drew the attention of numerous amici for both the lender and the borrower. In short, during the height of the housing bubble, the borrower received a call from a mortgage broker that the value of his home had doubled in two years. The borrower refinanced his home to pay down other debt, but could not manage the larger ...
On January 12, 2016, the Ninth Circuit affirmed the denial of class cert. in a Telephone Consumer Protection Act (TCPA), 47 USC 227 action on predominance and superiority grounds in the case Paul Gannon v. Network Telephone Services, Inc., et al., No. 13-56813, 2016 WL 145811 (9th Cir. Jan. 12, 2016). In Gannon, the plaintiff alleged that he called the defendants' phone sex service by accident, and quickly hung up. Nonetheless, plaintiff alleged that several weeks later he began receiving unsolicited text messages in violation of the TCPA. Defendants alleged incoming calls received ...
The brief era of confusion amongst Florida trial judges regarding the standard for judging compliance with conditions precedent in residential mortgage foreclosures is hopefully coming to a close. Despite a rash of written opinions from Florida trial judges adopting a strict compliance standard for contractual conditions precedent, Florida's Fifth District Court of Appeal joined the Second and the Third District Court of Appeal in adopting a substantial compliance standard in Bank of New York Mellon, etc. v. Donna D. Johnson, 5D14-3626 (Fla. 5th DCA Jan. 29, 2016). The opinion ...
In Cottrell as Trustee v. Taylor, Bean & Whitaker Mortgage Corp., 41 Fla. L. Weekly D141f, 2D14-5885 (Fla. 2d DCA Jan. 8, 2016), Florida's Second District Court of Appeal examined the applicability of Rule 1.540(b) to notices of voluntary dismissal undertaken with the mistaken belief the plaintiff's claim was time-barred. In Cottrell, fraud was not alleged as the basis to set aside the dismissal. Instead, it was mistake. See Fla. R. Civ. P. 1.540(b)(1). The bank alleged that it dismissed its case based on advice of counsel that the claim was time-barred. However, subsequent to the ...
In Stuart-Findlay v. Bank of America, N.A., 2010CA014370, 41 Fla. L. Weekly D207a (Fla. 4th DCA 2014), Florida's Fourth District Court of Appeal held that a clerk's default entered in error should have been set aside, regardless of the defendant's alleged failure to demonstrate excusable neglect, meritorious defenses, or due diligence. The facts of the case were not in dispute. At the time the clerk's default was entered, the defendant had served various papers in the action. As a result, pursuant to Fla. R. Civ. P. 1.500 the Court, and not the Clerk, was the proper party to enter a ...
In Castellanos v. Midland Funding, LLC, 15-CV-559 (M.D. Fla. Jan. 4, 2016) the United States District Judge John Steele joined with several of his Middle District of Florida colleagues and held that the Bankruptcy Code preempts the FDCPA with respect to filing time-barred proofs of claim. In Crawford v. LVNV Funding, LLC, the Eleventh Circuit held that filing a time-barred proof of claim in bankruptcy court violated the FDCPA. 758 F.3d 1254, 1262 (11th Cir. 2014) cert. denied, 135 S. Ct. 1844 (2015). To the contrary, the Bankruptcy Code permits creditors to file proofs of claim without ...
In Helton v. Bank of America, 5D14-2632 (Fla. 5th DCA Jan. 22, 2016), Florida's Fifth Circuit Court of Appeal echoed its opinion in Webster v. Chase Home Finance, LLC, 155 So. 3d 1219, 1220 (Fla. 5th DCA 2015) that oral testimony unsubstantiated by corresponding business records, that required foreclosure notice was actually sent, is insufficient. In reversing on hearsay grounds, the Fifth DCA observed that the witness did not purport to testify from personal knowledge that the notice was sent but rather that the lenders business records reflected it was sent. However, those records ...
In Garfield v. Ocwen Loan Servicing, LLC, 15-527 (2d Cir. Jan. 4, 2016), the Second Circuit Court of Appeals examined whether a debtor who has been discharged in a bankruptcy can sue in a district court under the Fair Debt Collection Practices Act ("FDCPA"), as opposed to seeking relief in the bankruptcy court. During her bankruptcy, the debtor paid the arrears on her mortgage, and agreed to make monthly payments to forestall foreclosure. After receiving her discharge, the debtor ceased making payments. Within months her arrearage totaled over six thousand dollars. The lender ...
In the case of Domistyle, Inc., 14-41463 (5th Cir. Dec. 29, 2015), the United States Court of Appeal for the Fifth Circuit affirmed an order of the bankruptcy court requiring a secured creditor to reimburse the trustee for expenses paid to preserve real property subject to the creditor's lien until the debtor's eventual surrender of the property to the creditor. The surcharge was based on Section 506(c) of the Bankruptcy Code which provides a "narrow" and "extraordinary" exception to the general rule that the administrative expenses of the bankruptcy estate are to be satisfied by the ...