118 F. Supp. 3d 1121
D. Minnesota2015Background
- Berger sues Nationstar and Bank of America for alleged wrongful default handling of a loan modified under HAMP.
- Berger’s loan originated in 2006; the Mortgage was assigned to BAC Home Loans Servicing, which merged into Bank of America, making BoA the successor.
- Berger’s Loan Modification was granted on June 24, 2013, adding past-due amounts to principal and setting monthly payments at $1,317.54.
- Nationstar acquired the loan in July 2013 (servicing included) and later foreclosed in October 2013, selling to Bank of America; Nationstar later claimed it would honor the BoA modification.
- Plaintiff alleges damages from the foreclosure/recording delays and improper transfer of the modification information; Count V asserts a negligence claim against BoA for an independent duty during the transfer.
- The Court granted BoA’s motion to dismiss Count V, finding no independent duty and that the negligence claim falls within the contractual scope between Berger and BoA.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether BoA owed an independent duty of care in transferring the loan. | Berger argues BoA owed a non-fiduciary duty to transfer the modification. | BoA contends no independent duty exists under Minnesota law. | No independent duty found; claim dismissed. |
| Whether Berger’s negligence claim falls within the scope of the contract. | Claim not based on modification terms; should survive. | Claim falls within contract; independent duty rule bars it. | Claim falls within the contractual relationship; dismissed. |
| Whether the independent-duty rule applies despite loss of contract. | Relationship ended post-transfer; not controlling. | Duty could arise from events while contracts governed. | Irrelevant; claims arise from preexisting contract, which governs. |
| Whether the case should be allowed to proceed with a contract claim in lieu of tort claim. | Plaintiff may plead contract-based relief instead. | Contract claim would require amendment; tort claim barred. | Court notes amendment possible but Count V dismissed as tort. |
Key Cases Cited
- Wild v. Rarig, 234 N.W.2d 775 (Minn. 1975) (independent duty rule origin; damages limited to breach unless independent tort)
- Russo v. NCS Pearson, Inc., 462 F.Supp.2d 981 (D. Minn. 2006) (independent duty rule applied to contract relations)
- Hanks v. Hubbard Broad., Inc., 493 N.W.2d 302 (Minn. Ct. App. 1992) (limits on tort claims arising from contractual relations)
- Domagala v. Rolland, 805 N.W.2d 14 (Minn. 2011) (five-factor approach to duty; exception to independent rule)
- Langeland v. Farmers State Bank of Trimont, 319 N.W.2d 26 (Minn. 1982) (distinguishes cases where tort claim not within contract scope)
- Roers v. Countrywide Home Loans, Inc., 728 F.3d 832 (8th Cir. 2013) (special relationship may create fiduciary duties; not present here)