Aliff v. Bank of America, N.A.
3:16-cv-10119
S.D.W. VaJan 31, 2017Background
- Plaintiff Tara Aliff refinanced a home loan with Bank of America (BoA); Ditech was the loan servicer receiving her payments.
- A 2016 fire destroyed Aliff’s home; insurer issued a $58,132.30 check; outstanding mortgage balance was $35,261.41.
- Aliff arranged with Ditech to apply the insurer’s check to the loan, remit payoff to BoA, and refund any excess to her.
- Ditech received the check Aug 29, 2016, credited the payment Aug 31, 2016, and mailed the $22,870.89 balance to Aliff on Sept 19, 2016.
- Aliff sued under TILA (15 U.S.C. §§ 1666d and 1639f) alleging untimely refund and delayed crediting caused loss of use and extra interest; she also asserted conversion.
- Defendants moved to dismiss; the court granted dismissal with prejudice as to the two TILA counts and dismissed the conversion claim without prejudice for lack of supplemental jurisdiction.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 1666d requires a refund within a "commercially reasonable" or other time-certain period (and whether servicer Ditech is liable) | Aliff: § 1666d requires refund within a commercially reasonable time (argues 21 days was not reasonable; borrows timing from Expedited Availability of Funds Act) | Defendants: § 1666d only requires refund (no timing provision); statute imposes duty on creditor, not servicer | Court: § 1666d requires refund but contains no timing deadline; applies only to creditors as defined by TILA; Ditech (servicer) not liable — Count One dismissed with prejudice |
| Whether § 1639f (credit payments as of date of receipt) supports a private cause of action against a servicer | Aliff: Ditech failed to credit payment on date received, causing interest; § 1639f requires same-day crediting by servicers | Ditech: No private right of action against servicers under TILA’s damages provision § 1640; enforcement of servicer duties lies with state AG under § 1640(e) | Court: § 1639f does not provide a private right against servicers because § 1640(a) creates remedies only against creditors; claim against Ditech fails — Count Two dismissed with prejudice |
| Whether the court should exercise supplemental jurisdiction over state-law conversion claim | Aliff: (implicit) conversion claim dependent on federal claims; seeks relief in federal court | Defendants: federal claims fail, so conversion should be dismissed or remanded | Court: Declines to exercise supplemental jurisdiction after dismissing federal claims; conversion dismissed without prejudice to state-court filing |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard: separate conclusions from well-pleaded facts; plausibility test)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility pleading standard; no mere labels and conclusions)
- Huffman v. West. Nuclear, Inc., 486 U.S. 663 (1988) (statutory purpose interpreted from plain text)
- United States v. Am. Trucking Ass’ns, 310 U.S. 534 (1940) (text of statute is primary evidence of congressional intent)
- City of Chicago v. Int’l Coll. of Surgeons, 522 U.S. 156 (1997) (supplemental jurisdiction is discretionary)
- United Mine Workers of Am. v. Gibbs, 383 U.S. 715 (1966) (pendent jurisdiction principles)
- Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343 (1988) (factors for declining supplemental jurisdiction: economy, convenience, fairness, comity)
- Carlsbad Tech., Inc. v. HIF Bio, Inc., 556 U.S. 635 (2009) (district court’s discretion to decline supplemental jurisdiction after dismissing federal claims)