Dale Wheatley v. JP Morgan Chase Bank
2017 U.S. App. LEXIS 10819
| 8th Cir. | 2017Background
- In 2006 Wheatley agreed verbally to take out a mortgage on Franklin’s Missouri house; Franklin would make payments and Wheatley would later deed the property to her.
- Franklin defaulted on payments beginning in 2009; loan servicer EMC repeatedly communicated with Wheatley, who signed a 2010 loan-modification conditioned on truthful statements that he was in default due to his own financial hardship.
- EMC accepted but misprocessed the modification (double-counting interest), so it never took effect; the loan remained in default and foreclosure notices continued.
- Servicing transferred to JPMorgan Chase (2011) and later to sub‑servicer SPS; after failed resolution efforts, SPS conducted a foreclosure sale in August 2013 and U.S. Bank (trustee) bought the house with a full‑credit bid.
- Wheatley and Franklin sued Chase, U.S. Bank, and SPS raising wrongful foreclosure, breach of contract, tortious interference, and MMPA claims; the district court granted summary judgment for defendants on all counts.
- On appeal, Wheatley challenges the MMPA dismissal; Franklin challenges dismissal of tortious‑interference claims. The court affirms, finding the foreclosure was authorized.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was the foreclosure unlawful, such that MMPA/tort claims can proceed? | Wheatley/Franklin argue defendants’ conduct caused their loss and foreclosure was improper. | Defendants say the foreclosure was authorized because the loan remained in default and modification never took effect. | Foreclosure was justified; plaintiffs’ claims fail because they cannot show defendants caused the loss. |
| Did the loan-modification agreement amend the loan despite Wheatley’s representations? | Wheatley contends his statements concerned inability to pay the lump‑sum, or that EMC knew Franklin paid, so modification should have taken effect. | Defendants point to the modification’s condition that Wheatley’s material representations be true; his statement that default resulted from his financial hardship was false. | Modification never amended the loan because Wheatley’s material representation was untrue; condition precedent not met. |
| Can Wheatley recover under the Missouri Merchandising Practices Act (MMPA) given the foreclosure? | Wheatley claims deceptive/unfair practices caused his loss. | Defendants say legality of foreclosure precludes causation required for MMPA recovery. | MMPA claim fails as a matter of law: plaintiff cannot show defendants’ misconduct caused his loss if foreclosure was lawful. |
| Can Franklin prove tortious interference where foreclosure occurred? | Franklin asserts defendants interfered with her contractual expectations (possession/deed). | Defendants contend a justified foreclosure provides justification, defeating an element of tortious‑interference (absence of justification). | Tortious‑interference claim fails because lawful foreclosure supplies justification, negating an essential element. |
Key Cases Cited
- Dupps v. Travelers Ins. Co., 80 F.3d 312 (8th Cir. 1996) (standard of review for summary judgment and state‑law interpretation).
- Sidebottom v. Delo, 46 F.3d 744 (8th Cir. 1995) (discussion of waiver/forfeiture principles on appeal).
- Cmty. Title Co. v. Roosevelt Fed. Sav. & Loan Ass’n, 796 S.W.2d 369 (Mo. 1990) (tortious‑interference requires absence of justification).