748 F.3d 793
8th Cir.2014Background
- Bracewell and Parsons, a married couple, sued U.S. Bank to void a mortgage foreclosure sale over alleged oral postponement promises.
- They claimed negligent misrepresentation and equitable estoppel arising from discussions during loan modification proceedings.
- The bank initially invited Bracewell to apply for a loan modification; foreclosure sale occurred while modification process was underway.
- The district court dismissed the case as barred by Minnesota Statute § 513.33 (Credit Agreement Statute).
- The court treated the statute as barring any action on a credit agreement unless in writing and signed; the alleged promise to postpone sale fell within a credit agreement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does § 513.33 bar negligent misrepresentation claims? | Bracewell/Parsons contend the statute does not apply to misrepresentation claims. | U.S. Bank argues the claim is an action on a credit agreement and thus barred. | Yes, barred; negligent misrepresentation is an action on a credit agreement and requires a writing. |
| Does equitable estoppel apply to enforce an oral postponement promise or does promissory estoppel apply and remain barred? | Bracewell/Parsons contend equitable estoppel shields reliance on the oral promise. | Bank argues the claim is barred by the statute; the complaint actually asserts promissory estoppel. | Barred; the claim is actually promissory estoppel and falls within the statute. |
Key Cases Cited
- Brisbin v. Aurora Loan Servs., LLC, 679 F.3d 748 (8th Cir. 2012) (oral promise to postpone foreclosure barred as a credit agreement)
- BankCherokee v. Insignia Dev., LLC, 779 N.W.2d 896 (Minn. Ct. App. 2010) (requires writing/signature for existence of a credit agreement under § 513.33)
- Olson v. Synergistic Techs. Bus. Sys., Inc., 628 N.W.2d 142 (Minn. 2001) (treats substance of claims by substance rather than labels for estoppel)
- Ridgewood Dev. Co. v. State, 294 N.W.2d 288 (Minn. 1980) (equitable estoppel defined as a remedy precluding assertions due to improper action)