Jeffery A. Wendt v. Bank of New York Mellon Trust Company, N.A.
487 P.3d 235
Alaska2021Background
- Jeffery and Julie Wendt executed a second deed of trust in 2005; they fell into default in 2016 and the debt was assigned to Bank of New York Mellon in March 2017.
- Robinson Tait, a law firm acting for the bank, sent an April 14, 2017 letter titled "Notice Required by the Fair Debt Collection Practice Act" stating a balance and 30‑day dispute rights, and sent notices of default (Apr. 19 and May 12) with a foreclosure sale ultimately held Aug. 24, 2017. The May 12 notice moved the sale date from Aug. 3 to Aug. 24 without highlighting the change.
- The bank purchased the property at the nonjudicial sale and later filed eviction proceedings; Wendt sued Robinson Tait and the bank alleging FDCPA and UTPA violations, state foreclosure‑notice defects, and sought rescission/quiet title.
- Robinson Tait later filed bankruptcy and was stayed out of the case; the superior court granted summary judgment to the bank, rejecting FDCPA, UTPA, and state‑statute claims and declining to rescind the sale; Wendt appealed.
- On appeal the Alaska Supreme Court affirmed: the bank was not a FDCPA debt collector for collection of its own debt; Wendt waived some arguments on appeal; and the alleged statutory notice defects did not make the sale inherently unfair.
Issues
| Issue | Wendt's Argument | Bank's Argument | Held |
|---|---|---|---|
| Whether the bank was a "debt collector" under the FDCPA | Robinson Tait’s April 14 letter and notices violated FDCPA and the bank is liable | Bank collected its own debt as assignee and thus is not a FDCPA "debt collector" | Bank is not a debt collector for its own debt; FDCPA does not apply to the bank in this role |
| Whether the bank can be held liable for Robinson Tait’s alleged FDCPA violations | Bank should be liable for hiring/using Robinson Tait (negligent hiring, bad servicing) | No viable theory preserves FDCPA liability as to a debt owner; Wendt failed to timely plead or prosecute such state torts | No viable FDCPA liability for the bank based on Robinson Tait; Wendt did not preserve a viable theory on appeal |
| Whether the UTPA claim survives absent an FDCPA violation | Any FDCPA violation is also a UTPA violation; thus UTPA claims should succeed | Because no FDCPA violation by the bank, UTPA derivative claim fails | UTPA claim fails where FDCPA claim fails; summary judgment affirmed on UTPA grounds |
| Whether notices violated state foreclosure law by omitting cure amount/contact info and whether sale should be rescinded | Notices lacked cure amount and adequate contact info, preventing exercise of right to cure; sale should be set aside | Statute does not require affirmative disclosure absent request; Wendt did not ask for cure amount or allege inability to request it | Even if duty existed, Wendt never requested cure figures or alleged he was prevented from doing so; deficiencies did not render sale inherently unfair; no rescission |
| Whether the trustee/beneficiary failed to notify a subsequent lienholder as required by AS 34.20.070(c)(4) | Subsequent lienholder was not mailed notice of default | Defense did not contest below; issue was not litigated | Claim that a subsequent lienholder lacked notice was not raised below and is waived on appeal |
Key Cases Cited
- Obduskey v. McCarthy & Holthus LLP, 139 S. Ct. 1029 (2019) (FDCPA "main coverage" inapplicable to nonjudicial foreclosures)
- Henson v. Santander Consumer USA Inc., 137 S. Ct. 1718 (2017) (FDCPA definition excludes entities collecting their own debts)
- Espeland v. OneWest Bank, FSB, 323 P.3d 2 (Alaska 2014) (summary judgment standard and appellate review principles)
- Alaska Trustee, LLC v. Ambridge, 372 P.3d 207 (Alaska 2016) ("material participation" test for FDCPA liability)
- Hagberg v. Alaska Nat'l Bank, 585 P.2d 559 (Alaska 1978) (lender implied duty to accept tender and provide cure figures when appropriate)
- Farmer v. Alaska USA Title Agency, Inc., 336 P.3d 160 (Alaska 2014) (duty to provide cure figures on request at reasonable time before foreclosure)
- Young v. Embley, 143 P.3d 936 (Alaska 2006) (junior lienholder entitled to timely reinstatement figures; sale unwound where rights denied)
- Rosenberg v. Smidt, 727 P.2d 778 (Alaska 1986) (sale voidable where creditor failed to diligently notify debtors)
- Cook Schuhmann & Groseclose, Inc. v. Brown & Root, Inc., 116 P.3d 592 (Alaska 2005) (standard for setting aside foreclosure sale)