Audrey Dick v. Colorado Housing Ent, L.L.C., et al

Case Type:
Consumer
Case Status:
Affirmed
Citation:
18-10900 (5th Circuit, Jul 05,2019) Published
Tag(s):
Ruling:
Affirmed District Court judgment dismissing Plaintiff/former debtor's contract and tort claims against creditors that foreclosed on former debtor's condo, and granting partial summary judgment on creditors' declaratory-judgment counterclaim for recognition of its ownership rights in the condo.
Procedural context:
Plaintiff/former debtor appealed a district court order granting Defendants/creditors' motion to dismiss all of her claims, and granting partial summary judgment on Defendants' counterclaim for a declaratory judgment recognizing their ownership rights in a foreclosed-upon condo. Plaintiff's allegation that her husband offered to pay an uncertain amount at an undetermined future time was, at best, a statement of a present intention to seek reinstatement of the loan in the future, and did not trigger an obligation on Defendants to immediately provide the reinstatement amount then due. "Even if there is an obligation to provide a reinstatement amount, which is unclear under Texas law," Plaintiff failed to explain how the reinstatement amount subsequently provided by Defendants' counsel would fail to meet that obligation. (Plaintiff did not mention that reinstatement amount in her complaint, but she acknowledged it in district court filings and in her appellate brief, which allowed the court to treat it as a binding admission of fact.) Plaintiff's negligent misrepresentation claim was barred by the economic loss rule. Her complaint acknowledged the loan was for a restaurant, which the court treated as an admission that consumer-debt-protection laws do not apply.
Facts:
Plaintiff obtained a loan from Defendants to open a restaurant in Colorado with her husband. The Defendants/lenders obtained a Deed of Trust on a condo in Texas that Plaintiff owned with her husband. Within a year, the restaurant closed and Plaintiff stopped making payments on the loan. Defendants sent a notice of acceleration and scheduled a foreclosure sale, which was stopped after Plaintiff filed a Chapter 13 petition (Case #1). Case #1 was dismissed for failure to file numerous documents; Defendants reset the sale; Plaintiff filed another Chapter 13 petition to stop that sale (Case #2). Case #2 was dismissed with prejudice after Plaintiff failed to pay the filing fee. Defendants reset the sale again, but that sale was stopped after Plaintiff filed a Chapter 13 petition for her husband (Case #3). The bankruptcy court dismissed Case #3 for failure to prosecute, granted in rem relief to ensure another petition for relief would not stop a foreclosure sale, and barred Plaintiff's husband from filing a case for two years. Defendants' fourth attempt to foreclose was stopped when Plaintiff filed suit in state court and obtained an injunction against the sale. Defendants removed the case to federal court, foreclosed on the condo, and filed a motion to dismiss all of the Plaintiff's claims, and a motion for partial summary judgment for a declaration of their ownership rights in the condo.
Judge(s):
Owen, Southwick, Higginson

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