946 F. Supp. 2d 160
D.D.C.2013Background
- McDevitt sues Wells Fargo for wrongful foreclosure, breach of contract, and negligent infliction of emotional distress under diversity jurisdiction.
- Note and Deed of Trust executed July 18, 2003 with World Savings Bank for $520,000; monthly payment schedule tied to an adjustable-rate mortgage and time-specific due dates.
- McDevitt's April 14, 2008 payments included a $25,000 amount intended to be applied to future monthly payments rather than principal, which Wachovia/Mortgage/Wachovia Bank misapplied to principal.
- Fraudulent or improper application of the $25,000 payment led to continued arrears and foreclosure proceedings.
- Foreclosure notices were sent but McDevitt did not receive them; foreclosure sale occurred on September 7, 2010, with sale proceeds of $510,000; equity after sale was $142,876.56.
- Court grants Wells Fargo’s summary judgment on all counts after reconsideration of stipulated facts and governing law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| FDCPA as predicate for wrongful foreclosure | McDevitt claims Rosenberg’s FDCPA violation invalidated foreclosure. | FDCPA applies only to debt collectors, not creditors; Wells Fargo not liable. | FDCPA claim cannot support wrongful foreclosure; Wells Fargo not a debt collector and summary judgment granted. |
| Contract interpretation and writing requirement | McDevitt argues past Bank conduct modified contract terms orally. | Note required monthly payments and any modifications must be in writing. | Note unambiguously requires monthly payments and writing for modifications; Wells Fargo entitled to summary judgment. |
| Effect of disputed payment on default status | McDevitt contends the $25,000 April 2008 prepayment satisfied period-owing payments. | Prepayment does not remove monthly payment obligation unless written changes are agreed. | Contract language controls; prepayment does not excuse ongoing monthly payments; judgment for Wells Fargo. |
| Negligent infliction of emotional distress (NIED) | Wells Fargo’s conduct or Rosenberg’s handling caused serious distress. | No duty or breach establishing NIED; no vicarious liability for attorney conduct. | No basis for Wells Fargo liability; grant of summary judgment on Count III. |
Key Cases Cited
- Johnson v. Fairfax Vill. Condo. IV Unit Owners Ass'n, 641 A.2d 495 (D.C. 1994) (wrongful foreclosure requires law-compliant notice or different outcome if not)
- Hedgepeth v. Whitman Walker Clinic, 22 A.3d 789 (D.C. 2011) (negligent infliction of emotional distress requires a special relationship and proof of breach)
- Liberty Lobby, Inc., 477 U.S. 242 (S. Ct. 1986) (summary judgment standard: no genuine issue of material fact)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (S. Ct. 1986) (reaffirming standard for genuine issues of material fact)
- Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133 (S. Ct. 2000) (credibility and weighing evidence are jury functions; summary judgment appropriate where no triable issue)
- Kibunja v. Alturas, LLC, 856 A.2d 1120 (D.C. 2004) (assumed applicability of DC notice statute in wrongful foreclosure analysis)
- Young v. 1st Am. Fin. Servs., 992 F. Supp. 440 (D.D.C. 1998) (foreclosure notices and notice compliance context)