Calcon Mutual Mortgage Corp. v. State ex rel. Wyoming Departmenrt of Audit, Division Banking
323 P.3d 1098
| Wyo. | 2014Background
- CalCon Mutual Mortgage Corporation brokered residential loans; the Wyoming Division of Banking examined six transactions (2008–2010) and found application fees and yield spread premiums larger than amounts previously disclosed to borrowers.
- In a representative loan, CalCon provided an initial good faith estimate (GFE) with no application fee or YSP, then seven days before closing sent a revised GFE showing a $150 application fee and a $4,224.21 YSP without any written explanation for the increase.
- The Division concluded CalCon violated Wyo. Stat. Ann. §§ 40-23-114(d) and 40-28-117(a)(iv) for failing to give a written explanation and demanded reimbursement to borrowers under the Commissioner’s authority to require reimbursement for undisclosed fees.
- CalCon requested a contested case hearing; the Office of Administrative Hearings found CalCon violated the statute and the Banking Commissioner ordered reimbursement; the district court affirmed on judicial review, and CalCon appealed.
- Central legal question: whether the statute requires a written explanation accompanying a new GFE when fees exceed the fee disclosed on the "most recent good faith estimate," or whether listing the increased fee on a revised GFE alone (timed to closing) suffices.
Issues
| Issue | Plaintiff's Argument (CalCon) | Defendant's Argument (Division/Commissioner) | Held |
|---|---|---|---|
| Meaning of "most recent good faith estimate" and whether a written explanation is required when fees increase | "Most recent" refers to the GFE most recent in time relative to closing; if the revised GFE at closing lists the higher fee, no separate written explanation is required | "Most recent" refers to the prior GFE already provided to the borrower; any fee exceeding that amount requires a new GFE plus a clear written explanation and reason at least three business days before closing | Held for Division: "most recent" is the estimate previously provided to borrower; broker must provide a new GFE and a clear written explanation of the increase and reason at least three business days before closing |
| Whether Commissioner's interpretation was arbitrary or capricious because no administrative rule defines "most recent good faith estimate" | Commissioner acted arbitrarily by enforcing a statutory phrase absent rulemaking | Statute is clear; an agency may enforce plain statutory language without promulgating a rule | Held for Division: interpretation followed plain statutory meaning and was not arbitrary or capricious |
Key Cases Cited
- State ex rel. Dep't of Family Servs. v. Kisling, 305 P.3d 1157 (Wyo. 2013) (standard for appellate review of administrative decisions)
- Dale v. S & S Builders, LLC, 188 P.3d 554 (Wyo. 2008) (agency legal conclusions reviewed de novo)
- Diamond B Servs., Inc. v. Rohde, 120 P.3d 1031 (Wyo. 2005) (same premise for legal-review standard)
- RME Petroleum Co. v. Wyo. Dep't of Revenue, 150 P.3d 673 (Wyo. 2007) (statutory ambiguity and interpretive approach)
- State ex rel. Wyo. Workers' Safety & Comp. Div. v. Singer, 248 P.3d 1155 (Wyo. 2011) (rule that statutes must be read in pari materia)
- Thomson v. Wyoming In-Stream Flow Comm., 651 P.2d 778 (Wyo. 1982) (agencies may enforce clear statutory directives without rulemaking)