519 F. App'x 861
5th Cir.2013Background
- Smiths defaulted on their mortgage and entered a loan modification with Deutsche Bank; Chase serviced the loan.
- Smiths filed for bankruptcy to stave off foreclosure; bankruptcy stays were lifted and they remain in possession.
- Smiths sued for breach of contract, unreasonable collection efforts, TDCPA violations, and negligent misrepresentation; district court granted summary judgment for defendants.
- Deutsche Bank purchased lender-placed insurance after borrower default and added the premium to the debt, within contract terms.
- The district court denied Smiths’ motion to vacate the summary judgment; issues included RESPA, TDCPA, and misrepresentation claims.
- The court affirmed summary judgment on all claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Breach of contract re insurance | Smiths claim lender breached by denying own insurance choice. | Lender could purchase insurance under the deed and add cost to debt. | No breach; lender acted within contract. |
| RESPA breach incorporation | RESAP provisions were incorporated and violated by incomplete history and disclosures. | RESPA was not expressly incorporated; no damages shown from partial history. | No RESPA breach; no damages shown. |
| Unreasonable collection efforts | Defendants harassed borrowers through incessant calls. | Call records show limited calls; plaintiff’s affidavit is uncorroborated. | No genuine dispute; no willful or malicious harassment. |
| TDCPA violations | TDCPA violated by insurance, charges, and RESPA responses. | Insurance, charges, and replies were proper or not deceptive; not proven deceptive. | No TDCPA violations established. |
| Negligent misrepresentation | Misrepresented right to insurance, restrictions on own coverage, and RESPA response. | First two claims mirror contract, barred by economic loss rule; third requires damages not shown. | Economic loss rule bars claim; no pecuniary loss shown. |
Key Cases Cited
- Mullins v. TestAmerica, Inc., 564 F.3d 386 (5th Cir.2009) (elements of contract breach and damages)
- EMC Mortgage Corp. v. Jones, 252 S.W.3d 857 (Tex.App.-Dallas 2008) (unreasonable collection efforts standard)
- Fed. Land Bank Ass’n of Tyler v. Sloane, 825 S.W.2d 439 (Tex.1991) (economic loss rule for negligent misrepresentation)
- Sterling Chems., Inc. v. Texaco, Inc., 259 S.W.3d 793 (Tex.App.-Houston 2007) (economic loss rule and contract damages guidance)
- Jamison v. McKesson Corp., 649 F.3d 322 (5th Cir.2011) (summary judgment standard and review)
- Chaney v. Dreyfus Serv. Corp., 595 F.3d 219 (5th Cir.2010) (evidence requirements for summary judgment)