Sterling Mortensen v. Countrywide Bank, Fsb
662 F. App'x 501
| 9th Cir. | 2016Background
- Sterling and Maureen Mortensen (pro se) sued over federal and state claims arising from foreclosure of their property.
- District court dismissed the complaint under Fed. R. Civ. P. 12(b)(6); Mortensens appealed.
- Claims included: TILA damages and rescission, RESPA servicing violations, challenges to MERS’s role on the deed of trust, breach of fiduciary duty, and "robo-signing" allegations.
- District court found TILA damages time-barred and rescission inadequately pleaded (no ability or intent to tender repayment).
- Court held RESPA claims lacked required qualifying servicer inquiries; MERS-related claims were foreclosed by Idaho law; lenders do not generally owe fiduciary duties to borrowers.
- Ninth Circuit reviewed de novo and affirmed the dismissal in full; several motions (record augmentation granted, judicial notice denied as unnecessary) were resolved on appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| TILA damages statute of limitations | Mortensens argued TILA violations entitled them to damages | Time-bar: one-year statute; no tolling shown | Dismissed — time-barred; no equitable tolling pleaded |
| TILA rescission | Mortensens sought rescission of the loan documents | Lacked allegation of ability/intent to tender repayment | Dismissed — rescission requires tender ability/intention |
| RESPA §2605 servicing response claim | Mortensens alleged servicer failed to respond to inquiries | Mortensens did not allege qualifying inquiries triggering response duty | Dismissed — insufficient factual allegations under RESPA |
| MERS on deed of trust | Mortensens challenged use of MERS as beneficiary/nominee | Idaho law permits MERS as nominee; this forecloses challenge | Dismissed — state law permits MERS’s role |
| Breach of fiduciary duty against lender | Mortensens asserted lender owed fiduciary duties | Lender-borrower relationship is not fiduciary absent special facts | Dismissed — no facts showing fiduciary relationship |
| Robo-signing allegations | Mortensens alleged improper robo-signed documents | Allegations were conclusory and lacked factual support | Dismissed — insufficient factual pleading |
Key Cases Cited
- Cervantes v. Countrywide Home Loans, Inc., 656 F.3d 1034 (9th Cir.) (standard of review for Rule 12(b)(6) and TILA limitations)
- Hebbe v. Pliler, 627 F.3d 338 (9th Cir.) (pro se pleadings are construed liberally but must state plausible claims)
- Yamamoto v. Bank of N.Y., 329 F.3d 1167 (9th Cir.) (rescission conditioned on repayment of amounts advanced)
- Edwards v. Mortg. Elec. Registration Sys., Inc., 300 P.3d 43 (Idaho 2013) (MERS as nominee complies with Idaho deed of trust requirements)
- Diaz v. Kubler Corp., 785 F.3d 1326 (9th Cir.) (federal courts follow state supreme court decisions on state-law questions)
- Black Canyon Racquetball Club, Inc. v. Idaho First Nat’l Bank, N.A., 804 P.2d 900 (Idaho) (lender-borrower relationship is generally not fiduciary)
- Padgett v. Wright, 587 F.3d 983 (9th Cir.) (appellate court will not consider issues raised for first time on appeal)