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Costley v. Bank of America, N.A.

United States District Court, D. Maryland

November 20, 2017

NATHANIEL M. COSTLEY, SR. ET AL.
v.
BANK OF AMERICA, N.A. ET AL.

          MEMORANDUM OPINION

          ELLEN L. HOLLANDER UNITED STATES DISTRICT JUDGE

         Plaintiffs Nathaniel M. Costley, Sr. (“Mr. Costley”)[1] and the Estate of Mary Jane Costley (“The Estate”) instituted suit against defendants Bank of America, N.A., Individually and as Successor By Merger to BAC Home Loans Servicing, LP F/K/A Countrywide Home Loans Servicing, LP (“BANA”); Nationstar Mortgage, LLC (“Nationstar”); and Green Tree Servicing, LLC (“Green Tree”), predecessor to Dietech Financial, LLC (“Ditech”). See ECF 1.[2] The Second Amended Complaint is the operative pleading. ECF 79.[3] Plaintiffs seek damages based on claims of fraud, conversion, breach of contract, violation of the Truth In Lending Act (“TILA”), 15 U.S.C. § 1601, et seq., and violation of the Fair Debt Collections Practices Act (“FDCPA”), 15 U.S.C. § 1692, et seq. Jurisdiction is founded on diversity of citizenship. ECF 79, ¶ 6.

         BANA and Nationstar are the remaining defendants.[4] They have jointly moved for summary judgment (ECF 119), supported by a memorandum of law (ECF 119-1) (collectively, the “Motion”) and numerous exhibits. Plaintiffs oppose the Motion (ECF 126) and have submitted exhibits. Defendants BANA and Nationstar have replied. ECF 128.

         The parties have fully briefed the issues, and no oral argument is necessary. See Local Rules 105.6. For the reasons set forth below, I shall grant defendants' motion.

         I. Background

         Mr. Costley resides in Westminster, Maryland. ECF 119-18 at 8. He is the grandson of the late Mary Jane Costley (“Ms. Costley”). ECF 79, ¶ 9; ECF 119-1 at 1. Until Ms. Costley's death in 2009, she was the record owner of property located at 63 Charles Street in Westminster, Maryland (the “Property”). ECF 79, ¶ 22; ECF 119-1 at 3; ECF 119-1 at 5. Prior to her death, Ms. Costley entered into two loans with respect to this Property. These loans form the basis of the parties' dispute.

         On September 29, 2006, Ms. Costley refinanced the existing mortgage on her property, taking out a loan (the “First Loan”) from Ocwen Loan Servicing, LLC. ECF 79, ¶ 11; ECF 119-1 at 3. She executed a promissory note (ECF 119-2) and a deed of trust (ECF 119-3) in the amount of $88, 935.00 in connection with the First Loan. Defendants were not involved in the origination of the First Loan. It was assigned to defendant BANA on December 30, 2011, (ECF 6-8), and was then assigned to Nationstar on January 4, 2013. ECF 6-11.

         On September 21, 2007, Ms. Costley obtained a second mortgage on her property, taking out a loan (the “Second Loan”) from Countrywide Bank, FSB, predecessor to BANA. ECF 79, ¶ 16; ECF 119-1 at 4. She executed a promissory note (ECF 119-6) and a deed of trust (ECF 119- 7) in the amount of $74, 000.00 in connection with the Second Loan. BANA transferred the Second Loan to Ditech in March 2011. ECF 79, ¶ 36; ECF 119-1 at 5.

         Ms. Costley became ill in August 2009, at which point she asked Mr. Costley to assist her with her finances. ECF 79, ¶ 18; ECF 119-1 at 5. Prior to that time, Mr. Costley had no knowledge of his grandmother's financial affairs, including the two loans. ECF 79, ¶ 19; ECF 119-1 at 5.

         Ms. Costley died in December 2009. ECF 79, ¶ 22; ECF 119-1 at 5. At that point, BANA was servicing both loans. ECF 79, ¶ 21; ECF 119-1 at 5. Notably, Ms. Costley had not kept current with payments on the loans prior to her death. ECF 79, ¶¶ 20, 26; ECF 119-1 at 5. BANA informed Mr. Costley that the value of the Property was less than the amount owed on the two loans. ECF 79, ¶¶ 26, 28; ECF 119-1 at 6. Nevertheless, Mr. Costley voluntarily moved into the Property in February 2010 (ECF 79, ¶ 30; ECF 119-1 at 5), and The Estate deeded the Property to him on May 4, 2010. ECF 6-7.

         In November 2009, shortly after Mr. Costley was made aware of his grandmother's financial situation and shortly before her death, Mr. Costley began an attempt to modify both loans. ECF 79, ¶ 21; ECF 119-1 at 6. This attempt continued in the months after the death of Ms. Costley. ECF 79, ¶ 25; ECF 119-1 at 6. Mr. Costley claims that at some point during those conversations BANA orally promised to modify or refinance the loans if he complied with certain conditions, and so he proceeded to comply with those conditions. ECF 79, ¶¶ 28-30; ECF 119-1 at 6. Mr. Costley's own affidavit (ECF 126-3) is the only evidence that such an oral agreement existed or that he complied with the terms of that agreement. Id. at 6.

         In January 2011, Mr. Costley submitted a Home Affordable Modification Program (“HAMP”) Loan Modification Agreement to BANA. ECF 119-16. BANA refused to sign the agreement, however. ECF 47-7. Instead, it offered to allow Mr. Costley to personally assume the loans and then reapply for loan modifications himself after assuming personal liability. ECF 119-1 at 6; ECF 119-18 at 15, 18-19. Mr. Costley refused to assume the loans. Id.

         Mr. Costley claims that, after BANA refused to sign the HAMP Loan Modification Agreement, he began to look more closely at the underlying loan documents. ECF 119-18 at 32-33. At that point, he says, he became suspicious about the legitimacy of the loans. Id. Specifically, he claims that he found an unsigned settlement sheet regarding the Second Loan, (ECF 119-18 at 14), realized that Ms. Costley was supposed to have received $30, 744.82 pursuant to a Settlement Statement regarding the First Loan, (ECF 79, ¶¶ 67-68), and realized that Ms. Costley was supposed to have received $72, 479.30 pursuant to a Settlement Statement regarding the Second Loan. ECF 79, ¶¶ 69-71. The record reflects that Ms. Costley made many payments on both loans (ECF 119-5; ECF 119-9), and includes the settlement statements for both loans. ECF 119-4; ECF 119-8. The only evidence in the record that Ms. Costley did not receive the payments she was supposed to have obtained pursuant to these settlement statements is Mr. Costley's own speculative assertions. ECF 119-18 at 22; ECF 126-3, ¶ 11.

         In March 2011, after the Second Loan was transferred to Ditech, Mr. Costley claims that he began receiving daily harassing phone calls, telling him to pay the money owed on the two loans. ECF 126-4, ¶ 10. He claims that these calls continued until June 2013. ECF 126-4, ¶ 16.

         On August 6, 2013, Mr. Costley was named the Personal Representative of Ms. Costley's Estate. ECF 126-4, ¶ 19. On August 26, 2013, faced with foreclosure and removal from the Property (ECF 119-1 at 7; ECF 126-4, ¶ 17), Mr. Costley filed the initial Complaint in this case, without counsel. ECF 1. After multiple amendments to the Complaint and discovery, the defendants filed motions for summary judgment. ECF 118; ECF 119. As noted, this court entered summary judgment for Ditech on May 9, 2017. ECF 130. Defendants BANA and Nationstar's joint motion for summary judgment is pending.

         II. Standard Of Review

         Under Rule 56(a) of the Federal Rules of Civil Procedure, summary judgment is appropriate only “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” See Celotex Corp. v. Catrett, 477 U.S. 317, 322-24 (1986); see also Iraq Middle Mkt. Dev. Found. v. Harmoosh, 848 F.3d 235, 238 (4th Cir. 2017) (“A court can grant summary judgment only if, viewing the evidence in the light most favorable to the non-moving party, the case presents no genuine issues of material fact and the moving party demonstrates entitlement to judgment as a matter of law.”). The non-moving party must demonstrate that there are disputes of material fact so as to preclude the award of summary judgment as a matter of law. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 585-86 (1986).

         The Supreme Court has clarified that not every factual dispute will defeat the motion. “By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986) (emphasis in original). A fact is “material” if it “might affect the outcome of the suit under the governing law.” Id. at 248. There is a genuine issue as to material fact “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id.; see Raynor v. Pugh, 817 F.3d 123, 130 (4th Cir. 2016).

         “A party opposing a properly supported motion for summary judgment ‘may not rest upon the mere allegations or denials of [its] pleadings, ' but rather must ‘set forth specific facts showing that there is a genuine issue for trial.'” Bouchat v. Baltimore Ravens Football Club, Inc., 346 F.3d 514, 522 (4th Cir. 2003) (quoting former Fed.R.Civ.P. 56(e)), cert. denied,514 U.S. 1042 (2004); see also Celotex, 477 U.S. at 322-24. In resolving a summary judgment motion, a court must view all of the facts, including reasonable inferences to be drawn from them, in the light most favorable to the non-moving party. Matsushita Elec. Indus. Co. Ltd., ...


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