Nationstar Mortgage, LLC v. Jeffrey A. Curatolo
2013 Ind. App. LEXIS 284
| Ind. Ct. App. | 2013Background
- In 2006 Curatolo executed a $245,000 note and mortgage; the mortgage was assigned to Nationstar in 2010.
- Nationstar sued to foreclose in September 2011 for default; Curatolo requested settlement/foreclosure-prevention conferences under Indiana Code ch. 32-30-10.5.
- The parties completed a three-month forbearance trial period; negotiations thereafter stalled with disputes over documentation and additional payment requests.
- The trial court found Nationstar acted in bad faith during negotiations, withheld sanctions, and then entered a final order purporting to modify the mortgage: 3% interest, $1,632.83 monthly for 15 years, beginning Nov. 1, 2012.
- Nationstar appealed, arguing the trial court lacked authority to impose a permanent modification without the creditor’s consent; the appellate court reversed and remanded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a trial court may permanently modify a mortgage over a creditor's objection after settlement conferences under Indiana Code ch. 32-30-10.5 | Curatolo: court could impose a modification as sanction for Nationstar’s bad-faith conduct | Nationstar: statute does not authorize courts to impose final mortgage modifications without mutual assent | Court held: trial court lacked authority to enter a permanent modification without both parties’ consent; reversal and remand |
Key Cases Cited
- Wencke v. City of Indianapolis, 429 N.E.2d 295 (Ind. Ct. App. 1981) (retrospective application of statute can impair contractual obligations)
- Voigt v. Voigt, 670 N.E.2d 1271 (Ind. 1996) (court may not create contractual obligations where sole authority for obligation derived from parties’ mutual assent)
- First Fed. Sav. & Loan Ass’n of Gary v. Stone, 467 N.E.2d 1226 (Ind. Ct. App. 1984) (courts must give effect to plain language of mortgage and may not rewrite contracts)
- Allied Prop. & Cas. Ins. Co. v. Good, 919 N.E.2d 144 (Ind. Ct. App. 2009) (recognizing inherent judicial power to impose sanctions but describing its proper limits)