SAN FRANCISCO – A U.S. District Court for the Northern District of California judge has ruled in favor of US Bank in a lawsuit from a home mortgage holder.
"The court dismisses with prejudice (plaintiff Carol Depuydt) Meier’s (Administrative Procedure Act) and (United Nations Commission on International Trade Law) Convention claims for lack of jurisdiction, severs and remands Meier’s state-law claim, and grants summary judgment to defendants on Meier’s RESPA claim. The court denies Meier’s cross-motion for summary judgment," the April 25 opinion, written by Judge Jon Tigar, states.
On March 30, 2006, Carol Depuydt Meier obtained a $600,000 mortgage from Downey Savings and Loan Association. On Nov. 21, 2008, The Federal Deposit Insurance Corp., acting as a receiver for Downey, signed an agreement with U.S. Bank to purchase assets, including Meier’s loan. Parent company US Bancorp does not own or service the loan.
The ruling states Meier defaulted in December 2009, and since then US Bank recorded notice of default and trustee’s sale several times, the most recent being Aug. 3, 2018. A sale was scheduled for Sept. 11, 2018, but Meier filed for Chapter 11 bankruptcy protection. On Nov. 9, her outstanding balance was more than $832,000 and the loan was 104 months past due, the ruling states.
In his opinion, Tigar said the present dispute is Meier’s allegation she submitted a payment bond on May 10, 2014, to close out the loan. The bank said it responded on May 29, 2014, saying it received her submission but that it did not satisfy her obligation to make payments.
On June 5, 2018, Meier sued US Bancorp, US Bank and Quality Loan Service Corp. in state court, alleging refusal of her bond violated a United Nations Commission on International Trade Law treaty, the federal Administrative Procedure Act (APA), the federal Real Estate Settlement Procedures Act and various state laws. US Bancorp and US Bank removed the action to federal court, then the defendants moved for summary judgment on Nov. 9.
Tigar said the APA claim is inappropriate because the law applies to federal agencies, not private financial institutions, and no APA provision requires compliance with California Uniform Commercial Code. As for her UNCITRAL claim, Tigar noted the United States hasn’t ratified that Convention, which means the treaty provides Meier no course of action. Even so, her loan is entirely domestic, and her payment bond has no reference to international banking. He dismissed both claims with prejudice.
Turning to her RESPA claim, Tigar explained that although he has jurisdiction and although her claim isn’t frivolous or insubstantial, it is barred by a statute of limitations and also must be dismissed. He said Meier filed her complaint more than four years after the March 21, 2014, written request to which she said the bank failed to respond, but such RESPA violations must be brought within three years.
Tigar also considered Meier’s state law claims, which he noted are sufficiently distinct from her RESPA claim, writing that “whether the Payment Bond satisfied Meier’s loan obligations under California law presents entirely distinct legal issues from whether defendants violated a statutory duty to respond to Meier’s RESPA inquiry.”
Meier sent the RESPA inquiry March 31, 2014, but didn’t execute the payment bond until May 8, giving further weight to Tigar’s position those claims are best left to a state judge. As such, he severed that portion of the complaint and remanded it for further proceeding. He also rejected the defendants’ request for various documents, finding them unnecessary to resolve the current motions.