Tielke v. Bank of America

Summarized by Aaron Kaufman , Gray Reed LLP
11 years 5 months ago

Citation:

Case No. 13-20425, unpublished

Tag(s):

Ruling:

District court erred by entering summary judgment for defendant bank on debtors' claims for violations of the Texas Debt Collection Act (TDCA) based on the record presented. After the debtors obtained a discharge under chapter 13, defendant sent a default notice and increased the debtors' mortgage payment to cover an escrow for forced placed insurance that the debtors apparently did not need. "The Tielkes claim that the unjustified escrow amount for homeowners’ insurance was the cause of the dispute between the parties, and we cannot say on this record that they are wrong. There are simply too many unanswered questions about the homeowners insurance, the Tielkes’ mortgage payments, and the bank’s application of the payments to justify summary judgment in this case at this time."

Procedural context:

Debtors sued their mortgage servicer after emerging from chapter 13 only to be harassed by default notices and misapplication of monthly payments. District court granted summary judgement in favor of defendant mortgage servicer on the basis that the record made clear that the debtors were in default in some fashion. Debtors appealed, arguing that the record demonstrated a genuine factual dispute over the application of payments.

Facts:

Debtors filed chapter 13 in 2004 and cured mortgage arrearages through their plan payments. They emerged from chapter 13 in 2011 with a discharge, but received a notice of default from their mortgage servicer within 3 months of such discharge. The servicer argued that the debtors were delinquent in their mortgage payments and failed to maintain homeowners insurance. The servicer increased the mortgage payment to cover an escrow for a forced placed insurance policy, even though the debtors had their own insurance policy. The debtors continued to pay the pre-default mortgage payment but allege that the servicer continued to harass them with phone calls and latters. They filed suit against the servicer seeking statutory and exemplary damages under the Texas Debt Collection Act (TDCA).

Judge(s):

REAVLEY, ELROD, and SOUTHWICK. Per curiam

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