Bulpitt, et al. v. Carrington Mortgage Services, LLC, et al.

2017 DNH 134

• Court: District Court, D. New Hampshire
• Decided: July 10, 2017
• Docket: 16-cv-399-JD
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Gary D. Bulpitt and Carolyn L. Bulpitt

v. Civil No. 16-cv-399-JD Opinion No. 2017 DNH 134 Carrington Mortgage Services, LLC and Deutsche Bank National Trust Company, as Trustee for the New Century Home Equity Trust 2005-3

O R D E R

Gary D. and Carolyn L. Bulpitt brought suit against

Carrington Mortgage Services, LLC (“Carrington”) and Deutsche

Bank National Trust Company, as Trustee for the New Century

Home Equity Trust 2005-3 (“Deutsche Bank”) after the foreclosure

sale of their home in Atkinson, New Hampshire. The defendants

move for summary judgment on the grounds that the plaintiffs

cannot prove any of their claims. The plaintiffs object to

summary judgment.

Standard of Review

Summary judgment is appropriate when the moving party

“shows that there is no genuine dispute as to any material fact

and the movant is entitled to judgment as a matter of law.”

Fed. R. Civ. P. 56(a). “A genuine dispute is one that a

reasonable fact-finder could resolve in favor of either party and a material fact is one that could affect the outcome of the

case.” Flood v. Bank of Am. Corp., 780 F.3d 1, 7 (1st Cir.

2015). The facts and reasonable inferences are taken in the

light most favorable to the nonmoving party. McGunigle v. City

of Quincy, 835 F.3d 192, 202 (1st Cir. 2016). “On issues where

the movant does not have the burden of proof at trial, the

movant can succeed on summary judgment by showing ‘that there is

an absence of evidence to support the nonmoving party's case.’”

OneBeacon Am. Ins. Co. v. Commercial Union Assurance Co. of

Canada, 684 F.3d 237, 241 (1st Cir. 2012) (quoting Celotex Corp.

v. Catrett, 477 U.S. 317, 325 (1986)).

Under the local rules in this district, memoranda in

support of and in opposition to a motion for summary judgment

must “incorporate a short and concise statement of material

facts, supported by appropriate record citations” to show

undisputed and disputed facts. LR 56.1. “All properly

supported material facts set forth in the moving party’s factual

statement may be deemed admitted unless properly opposed by the

adverse party.” LR 56.1(b).

Carrington and Deutsche Bank included a properly supported

statement of material facts in their memorandum in support of

their motion for summary judgment. The plaintiffs, who are

represented by counsel, filed the affidavit of Gary Bulpitt as a

separate document the day before they filed their objection to

2 summary judgment. The plaintiffs did not include any statement

of material facts in support of their objection to summary

judgment. As a result, the plaintiffs have not opposed the

defendants’ factual statement which is deemed to be admitted.

Background

Gary Bulpitt obtained a loan in the amount of $196,875.00

from New Century Mortgage Company and signed a note for that

amount in April of 2005. Gary and Carolyn Bulpitt signed a

mortgage on their property in Atkinson, New Hampshire, as

security for the loan. Gary Bulpitt states in his affidavit

that the loan was accelerated in February of 2011. The mortgage

was transferred to Deutsche Bank by an assignment dated March

16, 2011.

Beginning in July of 2011, the plaintiffs failed to pay the

monthly installments due on the loan and mortgage. Gary Bulpitt

states in his affidavit that he began a twelve-month

forebearance plan on December 1, 2012, which ended on November

1, 2013. Although Bulpitt also states that “the bank” made

certain promises as part of the forebearance plan, he did not

provide a copy of the plan to support his interpretation.

Bulpitt states that he submitted applications for assistance

under the Home Affordable Modification Program in 2013, which

“the bank” rejected on October 30, 2013. Bulpitt contends that

3 he appealed that decision within the time allowed but has not

received a determination of his appeal.

On November 5, 2015, Deutsche Bank provided notice to the

plaintiffs that their mortgaged property would be sold at public

auction on December 3, 2015. In response, on November 24, 2015,

Gary Bulpitt sent Deutsche Bank a request for mortgage

assistance. Deutsche Bank rejected the request the next day

because the foreclosure sale was scheduled to be held within

seven business days of when Deutsche Bank received the request.

The plaintiffs did not file a petition to enjoin the foreclosure

sale.

Deutsche Bank advertised the foreclosure sale three times

during November of 2015 in the New Hampshire Union Leader. The

foreclosure sale was held on December 3, 2015, as scheduled.

Deutsche Bank purchased the property for $215,360.00.

The plaintiffs brought suit in state court in July of 2016.

In the complaint, the plaintiffs allege claims for equitable

relief from the foreclosure sale, Count I; violation of the New

Hampshire Unfair, Deceptive, or Unreasonable Collection

Practices Act (“UDUCPA”) and the federal Fair Debt Collection

Practices Act (“FDCPA”), Count II; and violation of Regulation X

of the Real Estate Settlement Procedures Act (“RESPA”), Count

III. The defendants removed the case to this court.

4 Discussion

The defendants move for summary judgment on all of the

plaintiffs’ claims. In support, the defendants assert that the

plaintiffs are barred from challenging the foreclosure sale

because they failed to seek an injunction, they cannot prove a

lack of good faith or due diligence in conducting the

foreclosure sale, they cannot prove a violation of either the

UDUCPA or the FDCPA, and they cannot prove a violation of

Regulation X of RESPA. In their objection, the plaintiffs

argued at length that RSA 479:25, II does not provide a statute

of limitations for claims under RESPA, but failed to address the

other claims.

In their surreply, the plaintiffs have conceded that they

cannot prove their claims in Count I or their claims against

Deutsche Bank in Count II. As a result, the defendants are

entitled to summary judgment on all claims in Count I and on the

claims against Deutsche Bank in Count II. The plaintiffs

represent that their remaining claims are a violation of the

FDCPA against Carrington, alleged in Count II, and violations of

RESPA against both defendants, alleged in Count III.1 See

Surreply, doc. no. 21, at 1-2.

1 Although the plaintiffs referenced the Truth in Lending Act in their objection, they acknowledge in their surreply that they did not bring a claim under the Truth in Lending Act. See doc. no. 21, at 3, n.5.

5 A. Count II – FDCPA - Carrington

The FDCPA governs the practices of debt collectors. Chiang

v. Verizon N.E. Inc., 595 F.3d 26, 41 (1st Cir. 2010). A debt

collector under the FDCPA is a person or entity who regularly

collects debts that are owed to someone else. 15 U.S.C. §

1692a(6). Generally, enforcement of a security interest through

foreclosure on a mortgage is not debt collection activity for

purposes of the FDCPA. Harry v. Countrywide Home Loans Inc.,

215 F. Supp. 3d 183, 187 (D. Mass. 2016).

Carrington contends that it is not a debt collector within

the meaning of the FDCPA because its foreclosure sale of the

property, without seeking to recover any deficiency from the

plaintiffs, was not debt collection activity. The plaintiffs

did not address the issue of Carrington’s status as a debt

collector in their objection. In their surreply, the plaintiffs

state that Carrington was in the loan servicing business, which

involved collecting debts on behalf of Deutsche Bank, but do not

dispute that a mortgage foreclosure sale is not debt collection

within the meaning of the FDCPA.

Therefore, the plaintiffs provide no grounds to support

their FDCPA claim against Carrington and concede that they

cannot prove a violation of the FDCPA by Deutsche Bank. The

plaintiffs do not pursue their claim under RSA 358-C. The

6 defendants are entitled to summary judgment on all claims in

Count II.

B. Count III – RESPA – Carrington and Deutsche Bank

The plaintiffs allege that the defendants violated RESPA by

conducting the foreclosure sale of the property after they

submitted an application for loan modification. They allege

that the sale violated Regulation X, 12 C.F.R. § 1024.41(f)(2)

and (g).2 The defendants move for summary judgment on the ground

that the RESPA claims fail because the alleged violations of

Regulation X did not occur in this case. The defendants also

challenge the damages claimed by the plaintiffs.

1. RESPA Claim

As a threshold issue, the parties address different actions

as triggers for Regulation X. The complaint provides no detail

about the loan modification application that the plaintiffs

allege triggered Regulation X protection. In his affidavit

submitted in support of his objection, however, Gary Bulpitt

discusses a loan modification application that he represents he

Although the plaintiffs mentioned the Equal Credit 2

Opportunity Act and Regulation B, 12 C.F.R. 1002.1, et seq., in the introduction to their complaint, they did not bring a claim under the Equal Credit Opportunity Act. Instead, the claim in Count III alleges only a violation of RESPA, Regulation X. Because the plaintiffs are represented by counsel, the court will not liberally construe their complaint to incorporate claims that were not properly pleaded.

7 submitted in October of 2013.3 He states that his application

was denied on October 30, 2013. Bulpitt further states that the

bank agreed to give him thirty days to appeal and that he

submitted an appeal on November 28, 2013. Bulpitt represents

that the bank never acted on his appeal. The plaintiffs argue

that the 2013 loan modification application was still pending

when the defendants conducted the foreclosure sale of their

property in December of 2015.

The defendants assumed that the plaintiffs were relying on

their request for mortgage assistance that was submitted on

November 24, 2015, as the ground for their RESPA claim. Indeed,

it is hard to understand why the plaintiffs would request

mortgage assistance if they had an application for loan

modification pending. Further, the plaintiffs provide no

documentation to support Gary Bulpitt’s representations about

the process used for the 2013 application. Nevertheless, the

plaintiffs rely on the October of 2013 application and the

3 In their reply, the defendants assert that the plaintiffs provided “zero admissible evidence to support their claims” in response to the defendants’ motion for summary judgment. They do not object to or even address Gary Bulpitt’s affidavit, however. See Fed. R. Civ. P. 56(c)(2). As a result, the defendants failed to show that the affidavit cannot be considered in opposition to summary judgment. See Gonzalez- Bermudez v. Abbott Labs. PR Inc., 214 F. Supp. 3d 130, 137 (D.P.R. 2016).

8 appeal, and the defendants did not address that application,

despite the representations in Gary Bulpitt’s affidavit.

As the defendants explain in detail in their motion for

summary judgment and their reply, the plaintiffs’ November of

2015 request did not trigger Regulation X protections because it

was submitted after the plaintiffs received notice of the

foreclosure sale and less than thirty-seven days before the

foreclosure sale. The plaintiffs do not dispute that result.

Therefore, the defendants are entitled to summary judgment to

the extent Count III was based on the request for mortgage

assistance made in November of 2015.

The defendants, however, did not address the plaintiffs’

RESPA claim based on an application submitted by Gary Bulpitt in

October of 2013. Because the defendants do not seek summary

judgment on the plaintiffs’ claim based on the 2013 application,

that part of Count III avoids summary judgment.

2. Damages

In the complaint, the plaintiffs ask for an award of money

damages and also ask the court to declare the foreclosure void,

to rescind the foreclosure deed as void, to quiet title in the

property in the plaintiffs, and to enjoin the bank “from

alienating its interest in Plaintiffs’ Residence, in any way

until further order of this court.” The defendants challenge

9 the relief sought, other than money damages, on the ground that

those remedies are not available under RESPA. The plaintiffs

assert in their surreply that the court can grant the equitable

relief they seek under the Declaratory Judgment Act.

Relief under RESPA is limited to actual money damages,

along with a prevailing plaintiff’s costs and fees, so that

equitable relief is not available. 12 U.S.C. § 2605(f). Brown

v. Wells Fargo Home Mortg., 2016 WL 3440591, at *3 (D.N.H. June

20, 2016); see also Pacifico v. Nationstar Mortg., LLC, 2017 WL

1213662, at *3 (E.D. Mich. Feb. 10, 2017); Roosevelt Cayman

Asset Co II v. Mercado, 2016 WL 3976627, at *4 (D.P.R. July 22,

2016); Odum v. Specialized Loan Servicing, 2016 WL 4582070, at

*6 (N.D. Ga. July 5, 2016). Therefore, the plaintiffs’ requests

for equitable relief are not available under RESPA. Id.

The plaintiffs’ reliance on relief available under the

Declaratory Judgment Act, 28 U.S.C. § 2201, is inapposite to

this case. The plaintiffs brought suit in state court where

state law, not federal law, applies. More importantly, the

plaintiffs did not allege a claim under state law for a

declaratory judgment and did not amend their complaint to bring

a claim for a declaratory judgment under § 2201. Therefore, the

plaintiffs have not sought a declaratory judgment, and the

equitable relief they request is not available under RESPA.

10 Conclusion

For the foregoing reasons, the defendants’ motion for

summary judgment (document no. 11) is granted on Counts I and

II. The only claim remaining in the case is Count III, which is

limited to the claim that the defendants violated Regulation X,

§ 1024.41(f)(2) and § 1024.41(g), by conducting the foreclosure

sale while an appeal of the denial of an application for loan

modification, filed in October of 2013, remained pending. No

equitable relief is available under Count III.

SO ORDERED.

__________________________ Joseph DiClerico, Jr. United States District Judge

July 10, 2017

cc: Steven J. Dutton, Esq. Henry Klementowicz, Esq. William C. Sheridan, Esq.