Baker v. RoundPoint Mortgage Servicing Corporation
4:18-cv-01964
S.D. Tex.Jun 19, 2019Background
- Baker obtained a $264,093 mortgage in August 2014; the note and deed of trust required monthly payments and authorized collection of late fees, interest, costs, attorney’s fees, and foreclosure upon default.
- Cornerstone assigned servicing rights to Roundpoint in November 2014 and assigned the note and deed to Roundpoint in April 2018; assignments were recorded.
- Baker stopped paying in May 2017; Roundpoint granted a temporary three‑month forbearance in September 2017 but Baker failed to bring the loan current and missed additional payments; total reinstatement amount was $58,876.71.
- Baker applied for loan modifications (April 2018 and January 2019); Roundpoint denied them for insufficient income.
- Baker sued in May 2018 alleging breach of contract, wrongful foreclosure, unreasonable debt‑collection practices, TDCA and DTPA violations; Roundpoint removed and moved for summary judgment; Baker did not respond.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Unreasonable debt‑collection practices (common‑law tort) | Roundpoint harassed/coerced payment and mishandled modification review causing denial | Roundpoint acted within collection rights; conduct not willful, malicious, or extreme | Court: No evidence of requisite malicious intent; claim fails |
| Breach of contract (note/deed) | Roundpoint breached by mishandling modification, foreclosing, and misapplying payments | Baker defaulted and failed to perform; note/deed permit foreclosure and fees on default | Court: Baker defaulted and cannot assert breach; no evidence Roundpoint failed to credit payments |
| Breach of implied good‑faith duty | Roundpoint abused modification process; breached fiduciary‑type duty | No special relationship exists between borrower and mortgagee to imply such a duty | Court: No special relationship shown; claim fails |
| Texas Debt Collection Act (Tex. Fin. Code §§ 392.301(a)(7), 392.303(2)) | Roundpoint threatened collection despite forbearance and collected unauthorized incidental charges | Forbearance was temporary (not permanent); note/deed expressly authorize fees/costs/attorney’s fees on default | Court: No material factual dispute; statutory claims fail as a matter of law |
| Texas Deceptive Trade Practices Act (DTPA) | Roundpoint engaged in deceptive practices in servicing/modification | Baker is not a "consumer" under the DTPA for servicing/modification matters | Court: Servicing, foreclosure, and modification do not show consumer status; claim fails |
| Wrongful foreclosure | Roundpoint proceeded toward foreclosure wrongfully | No foreclosure sale occurred; sale was stayed by litigation; foreclosure steps authorized by deed after default | Court: No foreclosure sale and no evidence of defective sale/price; claim fails |
Key Cases Cited
- Shepherd on Behalf of Estate of Shepherd v. City of Shreveport, 920 F.3d 278 (5th Cir.) (standard for summary judgment)
- Renwick v. PNK Lake Charles, L.L.C., 901 F.3d 605 (5th Cir.) (materiality and genuine‑issue definitions)
- Celotex Corp. v. Catrett, 477 U.S. 317 (U.S.) (movant’s initial burden on summary judgment)
- EMC Mortg. Corp. v. Jones, 252 S.W.3d 857 (Tex. App. — Dallas) (elements for unreasonable debt‑collection tort)
- Smith Int’l, Inc. v. Egle Group, LLC, 490 F.3d 380 (5th Cir.) (elements of breach of contract)
- FDIC v. Coleman, 795 S.W.2d 706 (Tex.) (limits on implied duty of good faith in ordinary creditor‑debtor relationships)
- Miller v. BAC Home Loans Servicing, L.P., 726 F.3d 717 (5th Cir.) (consumer status required for DTPA claims)
- Morris v. Deutsche Bank Nat’l Tr. Co., 528 S.W.3d 187 (Tex. App. — Houston [14th Dist.]) (elements of wrongful‑foreclosure claim)