Frappier v. Countrywide Home Loans, Inc.
750 F.3d 91
1st Cir.2014Background
- Frappier filed a five-count state-law complaint in Suffolk Superior Court alleging loan-related claims against Countrywide which was removed to federal court on diversity grounds.
- The district court granted summary judgment on all counts in Countrywide's favor and then held a bench trial on the remaining claims.
- Frappier had obtained an October 2006 Fast and Easy loan (stated-income) and a December 2006 home equity loan from Countrywide.
- Frappier made timely payments on the October 2006 loan for about fifteen months before financial hardship led to delinquencies.
- The district court entered judgment for Countrywide on unjust enrichment and Chapter 93A claims after the bench trial.
- On appeal, Frappier challenged denial of amendment, denial of jury trial, and the district court's judgment on the pleadings; the First Circuit affirmed all district court rulings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the district court erred in denying amendment to include December 2006 Loan claims | Frappier argues amendments should relate to December 2006 loan | Countrywide contends undue delay and prejudice bar amendment | No abuse of discretion; amendment denied for undue delay and prejudice |
| Whether pre-closing conduct can support breach of the implied covenant | Frappier claims pre-closing conduct breached the covenant | Pre-closing conduct falls outside implied covenant after contract formation | Affirmed judgment on pleadings; pre-closing conduct not actionable under covenant |
| Whether Frappier had a right to a jury trial on 93A claim | Frappier seeks jury on 93A claim | Wallace controls; no right to jury | Harmless error standard applied; directed verdict would dispense with 93A claim on causation showing |
| Whether the district court abused its discretion on post-trial motion for amended findings or new trial | Requests more extensive addressing of 93A conduct and disclosures | Record supports conclusions; additional findings unnecessary | No abuse of discretion; district court's ruling affirmed |
Key Cases Cited
- Mass. Farm Bureau Fed'n, Inc. v. Blue Cross of Mass., Inc., 532 N.E.2d 660 (Mass. 1989) (causation required for recovery in similar contexts)
- AccuSoft Corp. v. Palo, 237 F.3d 31 (1st Cir. 2001) (pre-contract conduct generally not actionable under covenant of good faith)
- Steir v. Girl Scouts of the USA, 383 F.3d 7 (1st Cir. 2004) (abuse of discretion standard for amendment decisions)
- Wallace Motor Sales, Inc. v. American Motors Sales Corp., 780 F.2d 1049 (1st Cir. 1985) (seventh amendment jury trial issues in context of 93A claims)
- Chauffeurs, Teamsters & Helpers, Local No. 391 v. Terry, 494 U.S. 558 (1990) (two-part test for determining right to jury trial under Seventh Amendment)
- Nei v. Burley, 446 N.E.2d 674 (Mass. 1983) (Massachusetts constitution-based discussion of 93A jury rights (cited in Wallace))
- Gerli v. G.K. Hall & Co., 851 F.2d 452 (1st Cir. 1988) (recognizes availability of legal relief under chapter 93A in federal court)
- In re N-500L Cases, 691 F.2d 15 (1st Cir. 1982) (federal appellate review standards for trial court rulings)