Wills v. Ditech Financial, LLC
3:16-cv-00274
D. Or.Mar 29, 2018Background
- Lucille Wills borrowed $211,500 on March 27, 2007, secured by a Deed of Trust on the subject property; the property is now owned by the WPO-International Trust (WPO Trust) with Edward Bailey as trustee.
- Servicing history: Bank of America → Specialized Loan Servicing (SLS) → Ditech (formerly Green Tree) took over servicing on November 1, 2013. By that time Wills was delinquent and foreclosure had been initiated.
- Wills missed payments before and after Ditech began servicing; Ditech applied payments to oldest balances, waived some late fees, refused partial payments that would not bring the loan current, and declined to accept an "Unconditional International Promissory Note."
- Wills sought account history and requested corrections; Ditech investigated, concluded the account was delinquent, and informed Wills there were no servicing errors.
- Plaintiffs (Wills and Bailey as trustee) sued alleging RESPA violations, breach of contract (improper payment application), and unlawful foreclosure; SLS was dismissed with prejudice and Quality Loan Servicing agreed not to seek affirmative relief and to be bound by nonmonetary rulings.
- Plaintiffs did not respond to Ditech’s summary judgment motion despite appointment (and later termination) of pro bono counsel; the court deemed Ditech’s asserted facts undisputed and granted summary judgment for Ditech, dismissing the case.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| RESPA (failure to respond to servicing error requests) | Ditech failed to timely correct payment allocation errors, refused payments, and did not correct delinquent status | Ditech investigated, notified Wills of findings, waived some fees, and lawfully refused partial or unacceptable payments under the Deed of Trust | Summary judgment for Ditech; no RESPA violation |
| Breach of contract (payment application) | Two specific checks (nos. 4508 and 4578) were not applied to the loan | Bank of America records show those checks were applied and other payments were missed | Summary judgment for Ditech; no triable dispute of breach |
| Unlawful foreclosure | Foreclosure actions were improper (allegations mostly directed at Quality) | Plaintiffs waived affirmative relief against Quality; no evidence Ditech acted unlawfully in foreclosure | Claim against Quality dismissed by stipulation; no unlawful-foreclosure triable issue against Ditech |
| Procedural: failure to respond to summary judgment | Plaintiffs argue facts/support may exist (no response filed) | Ditech contends facts are undisputed and supports motion with record evidence | Court deemed Ditech’s facts undisputed, considered legal consequences, and granted summary judgment |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment standard and burden on movant)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (mere scintilla of evidence insufficient to defeat summary judgment)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (no genuine issue when record could not lead a rational trier of fact to find for non-movant)
- Clicks Billiards Inc. v. Sixshooters Inc., 251 F.3d 1252 (Ninth Circuit standards on drawing inferences for summary judgment)
- Heinemann v. Satterberg, 731 F.3d 914 (treatment of undisputed facts when a party fails to respond to summary judgment)