Young v. Wells Fargo Bank, N.A.
109 F. Supp. 3d 387
D. Mass.2015Background
- Susan Young entered a HAMP Trial Payment Plan (TPP) requiring three timely monthly trial payments; "time is of the essence" language was in the TPP.
- Young mailed the second and third TPP payments one day before due dates, but defendants received them one day late (Dec. 2 and Jan. 2). Homeward sent a HAMP denial letter on Jan. 13, 2010 stating untimely payments as the reason.
- Young's representative later spoke with Homeward employees who said the denial letter was sent in error and that a permanent modification was being processed; Homeward ultimately offered a non‑HAMP (traditional) permanent modification on June 14, 2010.
- Young sued for breach of contract (failure to provide a permanent HAMP modification by Feb. 1, 2010), Chapter 93A claims (emotional and economic damages), and equitable relief; defendants moved for summary judgment on remaining claims.
- Key documentary and testimonial evidence: the TPP strict‑timing language, Rule 30(b)(6) testimony that HAMP requires strict compliance, computer‑generated denial, and lack of admissible evidence showing specific damages arising from delay.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Young's one‑day‑late TPP payments were a material breach excusing defendants from HAMP performance | Young argued brief delays were immaterial; defendants routinely cashed checks late and Homeward miscommunicated about eligibility | Defendants argued HAMP requires strict compliance with TPP timing; untimely payments preclude HAMP consideration | Court: The one‑day lateness was a material breach as a matter of law for HAMP eligibility; breach claim fails on this basis |
| Whether Young proved damages from the alleged breach of the TPP (permanent modification by Feb. 1, 2010) | Young claimed credit harm, emotional distress, out‑of‑pocket fees and lost equity but produced no admissible proof | Defendants asserted Young provided no evidence of actual pecuniary damages and waived late fees; only a permanent modification was offered in June | Court: Summary judgment for defendants due to absence of evidence of damages for the contract claim |
| Whether Homeward/Wells Fargo violated Mass. Gen. Laws ch. 93A (emotional injury) | Young sought emotional damages under 93A for distress caused by servicing and communications | Defendants contended emotional damages require IIED elements and Young offered no evidence of intent or extreme conduct | Court: Emotional damages under 93A dismissed—Young failed to prove IIED elements or requisite intent |
| Whether Homeward/Wells Fargo violated ch. 93A (economic injury/unfair or deceptive acts) based on forbearance, denial letter, ARM notice, delay and offering a traditional modification | Young alleged Homeward forced forbearance, sent an erroneous denial, misled her about modification status, sent ARM notice and delayed/altered modification terms causing economic harm | Defendants argued they lawfully foreclosed/forbore under mortgage terms, the denial was a computer trigger and negligent mistake, ARM change was authorized by the mortgage, and Homeward ultimately offered a traditional modification; Young lacks proof of HAMP guideline violation or resulting damages | Court: Summary judgment for defendants—Homeward's conduct not unfair or deceptive as a matter of law and no admissible evidence of economic damages |
Key Cases Cited
- Young v. Wells Fargo Bank, N.A., 717 F.3d 224 (1st Cir. 2013) (prior appellate discussion of pleadings and damages issue)
- Teragram Corp. v. Marketwatch.com, Inc., 444 F.3d 1 (1st Cir. 2006) (material breach analysis excusing further performance)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (summary judgment standard)
- Celotex Corp. v. Catrett, 477 U.S. 317 (U.S. 1986) (party bearing burden must show absence of evidence on essential element)
- LeBlanc v. Great Am. Ins. Co., 6 F.3d 836 (1st Cir. 1993) (view record in favor of nonmovant at summary judgment)
- Prescott v. Higgins, 538 F.3d 32 (1st Cir. 2008) (disregard conclusory allegations and speculation at summary judgment)
- John Hancock Mut. Life Ins. Co. v. Banerji, 858 N.E.2d 277 (Mass. 2006) (emotional distress damages generally not recoverable in contract actions)
- Mass. Eye & Ear Infirmary v. QLT Phototherapeutics, Inc., 412 F.3d 215 (1st Cir. 2005) (three‑factor test for unfairness under Chapter 93A)
- Rodi v. S. New Eng. Sch. of Law, 389 F.3d 5 (1st Cir. 2004) (demand letter prerequisite to Chapter 93A suit)