United States District Court, W.D. Washington
TERESA S. TITUS, Plaintiff,
WELLS FARGO, N.A., WELLS FARGO HOME MORTGAGE, FEDERAL NATIONAL MORTGAGE ASSOCIATION aka FANNIE MAE, NORTHWEST TRUSTEES SERVICES, INCL., RCO LEGAL P.S., and MORTGAGE ELECTRONIC SYSTEM MERS, Defendants.
ORDER ON (1) WELLS FARGO, FANNIE MAE, AND MERS'
MOTION FOR SUMMARY JUDGMENT AND (2) JOINT MOTION FOR SUMMARY
JUDGMENT OF DEFENDANTS NORTHWEST TRUSTEE SERVICES INC. AND
RCO LEGAL, P.S.
J. BRYAN United States District Judge
MATTER comes before the Court on two matters: the Motion for
Summary Judgment (Dkt. 66) filed by several defendants: Wells
Fargo, N.A. and Wells Fargo Home Mortgage (collectively,
“Wells Fargo”), Federal National Mortgage
Association, aka Fannie Mae, and Mortgage Electronic System
(“MERS”); and the Joint Motion for Summary
Judgment of Defendants Northwest Trustee Services, Inc. and
RCO Legal, P.S (Dkt. 69). The Court has considered the
pleadings filed in support of and in opposition to the
motions, oral argument by the parties held in open court on
June 5, 2017, and the remainder of the file herein.
Court previously dismissed all claims against Fannie Mae and
MERS. Dkt. 47 at 16. Because there are no pending claims
against Fannie Mae and MERS, for both defendants the motion
for summary judgment is moot.
Wells Fargo, the Court dismissed all claims except those for
violations of the Federal Debt Collection Practices Act
(FDCPA) (Claim 1) and the Washington Consumer Protection Act
(CPA) (Claim 5), as well as a common law claim for breach of
contract (Count 3). Dkt. 47 at 16.
Court dismissed all claims against RCO Legal, except the
claim for violations of the FDCPA (Claim 1). Dkt. 33 at 8.
The Court dismissed all claims against Northwest Trustee
except the claim for violations of the FDCPA (Claim 1). Dkt.
32 at 9.
facts substantiated by the record are recited in favor of the
nonmoving party, Ms. Titus.
2007, Ms. Titus executed a promissory note (“Promissory
Note”) to obtain a mortgage loan from SunTrust
Mortgage, Inc. Dkt. 67-1. The Promissory Note named Ms. Titus
as Borrower and SunTrust Mortgage as Lender. The Promissory
Note states that the Borrower “understand[s] that the
Lender may transfer this Note” and that “anyone
who takes this Note by transfer . . . is called the
‘Note Holder.'” Id. To secure her
obligations under the Note, Ms. Titus executed a Deed of
Trust, which listed Ms. Titus as Borrower and SunTrust
Mortgage as Lender. Dkt. 67-3.
December of 2010, Ms. Titus defaulted on her loan by
deliberately not paying monthly mortgage payments. Dkt. 74 at
¶12. She made the decision on the telephonic advice of
Wells Fargo employees, who, Ms. Titus represents, told her
that defaulting on her loan was the only way to gain
eligibility to refinance her loan. Id. at
¶¶9-11. At that time, Ms. Titus was gainfully
employed and had over $70, 000 in savings. Id. After
defaulting on the loan, Ms. Titus qualified for a HAMP loan
modification (“Modified Loan Agreement”), which
she executed on June 17, 2011. Id. at ¶13; Dkt.
67-6. The Modified Loan Agreement listed Wells Fargo as
“Lender or Servicer” and MERS as “nominee
for lender and lender's successors and assigns.”
Id. at 2. The agreement gave MERS “the right
to exercise . . . the right to foreclose . . . and to take
any action required of the lender[.]” Id. at
Titus defaulted a second time in 2013, this time due to
financial hardship. Dkt. 74 at ¶15. By letter dated
September 16, 2013, Wells Fargo informed Ms. Titus that her
loan was in default. Dkt. 74-1 at 2. The letter explained how
Ms. Titus could cure the default and requested that Ms. Titus
continue making monthly loan payments. Id. A formal
Notice of Default later followed, naming Wells Fargo as the
loan servicer. Dkt. 70-8.
October 8, 2013, MERS, as nominee for SunTrust Mortgage,
executed an Assignment of Deed of Trust conveying the Deed of
Trust to Wells Fargo. Dkt. 67-9. On December 19, 2013, Wells
Fargo executed a Beneficiary Declaration affirming its status
as the “actual holder of the promissory note . . .
secured by the deed of trust.” Dkt. 67-8. The
Beneficiary Declaration states that “the trustee may
rely upon the truth and accuracy of the averments made in
this declaration.” Id.
Titus entered Chapter 13 bankruptcy on March 3, 2014, which
remained pending until April 17, 2015. Dkt. 74 at
¶¶15, 18. Thereafter Ms. Titus sought a second loan
modification. Represented by an attorney, Ms. Titus attended
two foreclosure mediation sessions, in July and September of
2015. Ms. Titus and Wells Fargo both signed an Agreement to
Participate in Foreclosure Mediation. Dkt. 74-3 at 2, 3. The
mediation was unsuccessful. Dkt. 70-13 at 2, 3. According to
Ms. Titus, Wells Fargo made only “take it or leave
it” offers, without meaningfully negotiating. Dkt. 74
at ¶34. A legal assistant to Ms. Titus'
then-attorney states that at the July 2015 session she heard
an attorney for Wells Fargo state, “We don't have
the note.” Dkt. 74-6 at 7.
support of Wells Fargo's argument that it did (and still
does) possess the Promissory Note, at oral argument Wells
Fargo-for the first time-produced what it represents to be
the original Promissory Note. Dkt. 85. The Promissory Note
has an indorsement in blank by SunTrust Mortgage and a
signature signed in blue ink by Ms. Titus. Dkt. 85 at 3.
According to Wells Fargo's records custodian, Shae Smith,
Wells Fargo's business records show loan servicing by
Wells Fargo beginning in December 1, 2007 and possession of
the Promissory Note on January 7, 2008. Dkt. 67 at
¶¶3, 4; Dkt. 67-2.
judgment is proper only if the pleadings, the discovery and
disclosure materials on file, and any affidavits show that
there is no genuine issue as to any material fact and that
the movant is entitled to judgment as a matter of law.
Fed.R.Civ.P. 56(c). The moving party is entitled to judgment
as a matter of law when the nonmoving party fails to make a
sufficient showing on an essential element of a claim in the
case on which the nonmoving party has the burden of proof.
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1985).
There is no genuine issue of fact for trial where the record,
taken as a whole, could not lead a rational trier of fact to
find for the nonmoving party. Matsushita Elec. Indus. Co.
v. Zenith Radio Corp., 475 U.S. 574, 586
(1986)(nonmoving party must present specific, significant
probative evidence, not simply “some metaphysical
doubt.”). See also Fed.R.Civ.P. 56(e).
Conversely, a genuine dispute over a material fact exists if
there is sufficient evidence supporting the claimed factual
dispute, requiring a judge or jury to resolve the differing
versions of the truth. Anderson v. Liberty Lobby,
Inc., 477 .S. 242, 253 (1986); T.W. Elec. Service
Inc. v. Pacific Electrical Contractors Association, 809
F.2d 626, 630 (9th Cir. 1987).
determination of the existence of a material fact is often a
close question. The court must consider the substantive
evidentiary burden that the nonmoving party must meet at
trial - e.g., a preponderance of the evidence in most civil
cases. Anderson, 477 U.S. at 254, T.W. Elect.
Service Inc., 809 F.2d at 630. Any factual issues of
controversy must be resolved in favor of the nonmoving party
only when the facts specifically attested by that party
contradict facts specifically attested by the moving party.
The nonmoving party may not merely state that it will
discredit the moving party's evidence at trial, in the
hopes that evidence can be developed at trial to support the
claim. T.W. Elect. Service Inc., 809 F.2d at 630
(relying on Anderson, supra). ...