Peter Bloch v. Wells Fargo Home Mortgage
2014 U.S. App. LEXIS 2042
| 11th Cir. | 2014Background
- Peter and Maria Bloch obtained a $324,000 mortgage in 2002; Wells Fargo serviced the loan.
- The Blochs defaulted, faced foreclosure in 2008, obtained a loan modification, then later defaulted again leading to a second foreclosure.
- Wells Fargo invited the Blochs (Sept. 2009) to apply for HAMP; they submitted an application, made four trial payments, but Wells Fargo determined they did not qualify and credited the payments to the loan balance.
- The Blochs executed a Special Forbearance Agreement in Jan. 2010 providing that other loan terms remained in effect and Wells Fargo was not obligated to enter further agreements.
- The Blochs stopped paying after April 2010, declined a permanent modification offered in Feb. 2011, and sued in federal court in April 2011; by summary judgment the remaining claims were (1) promissory estoppel based on HAMP-related statements and (2) negligent misrepresentation based on an October 23, 2009 statement that they were HAMP participants.
- The district court granted summary judgment for Wells Fargo; the Eleventh Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Promissory estoppel based on HAMP letter/phone statements | Bloch: Wells Fargo’s Sept. 2009 letter and oral statements promised HAMP consideration/participation and induced forbearance (foregoing short sale/bankruptcy) | Wells Fargo: the letter was not a binding promise; loan was reviewed and denied; oral promises about loan terms are barred by Florida’s Banking Statute of Frauds (§ 687.0304) | Summary judgment for Wells Fargo — promissory estoppel fails (no enforceable written agreement; statute of frauds bar) |
| Negligent misrepresentation (October 23, 2009 statement) | Bloch: Wells Fargo employee told counsel Blochs were HAMP participants; they relied and thus suffered damages (lost opportunity to sell) | Wells Fargo: any alleged injury is speculative; Blochs defaulted and paid no more than owed; no concrete damages from the statement | Summary judgment for Wells Fargo — negligent misrepresentation fails for lack of concrete, non-speculative damages |
Key Cases Cited
- DK Arena, Inc. v. EB Acquisitions I, LLC, 112 So. 3d 85 (Fla. 2013) (elements of promissory estoppel and limitations under Statute of Frauds)
- Miller v. Chase Home Fin., LLC, 677 F.3d 1113 (11th Cir.) (no private HAMP cause of action; promissory-estoppel limits in loan-modification context)
- Coral Reef Drive Land Dev., LLC v. Duke Realty Ltd. P’ship, 45 So. 3d 897 (Fla. 3d DCA) (Banking Statute of Frauds bars oral lender forbearance agreements)
- Rocky Creek Ret. Props., Inc. v. Estate of Fox ex rel. Bank of Am., 19 So. 3d 1105 (Fla. 2d DCA) (negligent misrepresentation elements)
- George Hunt, Inc. v. Dorsey Young Constr., Inc., 385 So. 2d 732 (Fla. 4th DCA) (damages must be concrete, not speculative)
- Colandrea v. Johnson, 632 So. 2d 284 (Fla. 2d DCA) (speculative damages insufficient)
- Dawkins v. Fulton Cnty. Gov’t, 733 F.3d 1084 (11th Cir.) (summary judgment standard; inferences for nonmovant must be reasonable)