Wood v. Greenberry Financial Services, Inc.
907 F. Supp. 2d 1165
D. Haw.2012Background
- Plaintiffs own property in Kailua-Kona, Hawaii and executed a $280,000 loan on December 8, 2006 secured by a mortgage with MERS as nominee for Franklin Financial.
- The Note was assigned by MERS to Wells Fargo and recorded in July 2010; Wells Fargo later foreclosed and a Mortgagee’s Quitclaim Deed was recorded in May 2012.
- EMC Mortgage Corporation serviced the loan after January 2007 and facilitated a Loan Modification in October 2008; Notices of Acceleration were sent in 2010.
- Plaintiffs allege pre-closing misrepresentations, undisclosed terms, and missing copies of several origination documents; they assert improper transfer and chain-of-title issues.
- Plaintiffs filed suit March 9, 2011 (amended July 25, 2011) asserting multiple federal and Hawai‘i-law claims including HOEPA, RESPA, TILA, FCRA, and various contract/ Tort theories.
- Defendants moved for summary judgment on all counts; the court granted and disposed of all claims in favor of defendants, declining extended discovery.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| HOEPA/TILA timeliness | Wood asserted ongoing misrepresentations and rescission claims within tolling periods. | Counts I and III are time-barred; disclosures were provided and rescission period expired. | Counts I and III barred; grants motion as to HOEPA/TILA. |
| RESPA timeliness | RESPA violations occurred during servicing; damages sought within statutory windows. | Count II is time-barred and lacks merit; defendants were not originators. | Count II barred; grants motion as to RESPA. |
| FCRA standing | Plaintiffs allege furnishing of erroneous information violated FCRA. | Private right of action under § 1681s-2(b) requires CRA-notified dispute; plaintiffs fail to show notice or damage. | Count IV granted; no standing for FCRA claim. |
| Fraud and Mistake claims | Pre-closing misrepresentations and mutual mistake support relief. | No false representations by defendants; Rule 9(b) deficiencies; no grounds for mutual mistake against non-parties to the closing. | Counts V, X, and XII granted; fraud/mistake claims dismissed. |
| Unjust enrichment | Equitable relief sought independent of contract due to alleged improper conduct. | There is an express contract (Note and Mortgage), precluding unjust enrichment. | Count VII granted; unjust enrichment claim barred by express contracts. |
Key Cases Cited
- Miyashiro v. Roehrig, Roehrig, Wilson & Hara, 122 Hawai'i 461 (Haw. Ct. App. 2010) (fraud elements; heightened pleading standards in Hawai'i)
- Nymark v. Heart Fed. Sav. & Loan Ass'n, 283 Cal.Rptr. 53 (Cal. Ct. App. 1991) (lender not fiduciary absent special circumstances)
- Best Place, Inc. v. Penn Am. Ins. Co., 920 P.2d 334 (Haw. 1996) (tort of bad faith limited to special relationships; contract context)
- Robert's Haw. Sch. Bus., Inc. v. Laupahoehoe Transp. Co., Inc., 982 P.2d 853 (Haw. 1999) (definition and requirements for conspiracy under Hawai'i law)
- Phillips v. Bank of Am., Nat’l Ass’n, 2011 WL 240813 (D. Haw. 2011) (unconscionability; pre-contract conduct limits recovery)
- Matsumura v. Bank of Am., N.A., 2012 WL 463933 (D. Haw. 2012) (statutory wrongful foreclosure considerations)
- Doran v. Wells Fargo Bank, 2011 WL 5239738 (D. Haw. 2011) ( wrongful foreclosure analysis under HRS ch. 667)