Belanger v. BAC Home Loans Servicing, L.P.
839 F. Supp. 2d 873
W.D. Tex.2011Background
- Belanger applied for a December 2006 loan from Countrywide to purchase real property in Texas, with income overstated in loan documents ($5,142/mo) despite records showing about $2,800/mo; loan amount approved at $97,850 secured by a deed of trust.
- Countrywide transferred the note to BAC in 2008; BAC later faced foreclosure threats after Belanger stopped paying when no monthly statements or original note were produced.
- Belanger sued BAC in April 2011 in state court for predatory lending, unconscionability, negligence, fraud, seeking declaratory relief, quiet title, and a TRO; TRO was granted and the case was removed to federal court.
- The court granted summary judgment in part and denied in part, dismissing predatory lending, negligence, fraud, and quiet-title claims, but allowing unconscionability as a defense to foreclosure to survive.
- The court concluded BAC is entitled to summary judgment on the torts and quiet-title claims, but Belanger may have a viable unconscionability defense, so that portion proceeds to trial or further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Predatory lending claim viability | Belanger asserts predatory lending as a basis for relief | BAC argues no independent predatory-lending claim exists under Texas law | Predatory-lending claim dismissed |
| Negligence and gross negligence against BAC | Belanger seeks to hold BAC liable for Countrywide’s loan-approval negligence and BAC’s own conduct | No vicarious liability for transferor’s torts; economic-loss rule bars purely economic damages | Summary judgment for BAC on negligence claims |
| Fraud claim against BAC (through Countrywide) | Belanger alleges misrepresentation of income to induce loan | No evidence of intent to induce Belanger or justifiable reliance; claim time-barred | Summary judgment for BAC on fraud claim |
| Suit to quiet title based on Texas Constitution §50(a)(6) | Belanger contends loan violates home-equity provisions and seeks quiet title relief | Lien is purchase-money, not home-equity; limitations period may bar claim | Summary judgment for BAC on quiet-title claim |
| Unconscionability defense to foreclosure | Belanger asserts procedural and substantive unconscionability | BAC argues no basis to conclusively disprove unconscionability; factual disputes exist | Unconscionability defense survives the motion; not fully resolved at this stage |
Key Cases Cited
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (genuine dispute required for trial; view evidence in light favorable to nonmovant)
- Blanche v. First Nationwide Mortgage Corp., 74 S.W.3d 444 (Tex. App.‑Dallas 2002) (economic-loss rule governs negligence damages not arising from torts beyond contract breach)
- In re Palm Harbor Homes, Inc., 195 S.W.3d 672 (Tex. 2006) (unconscionability test for contract terms in Texas)
- United States v. Hous. Pipeline Co., 37 F.3d 224 (5th Cir. 1994) (judge may grant summary judgment on record evidence)
- Jim Walter Homes, Inc. v. Reed, 711 S.W.2d 617 (Tex. 1986) (economic damages required to support negligence claim)