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Consolo v. Bank of America

United States District Court, D. Massachusetts

May 2, 2017

JOHN CONSOLO, Plaintiff,
v.
BANK OF AMERICA et al., Defendant.

          MEMORANDUM AND ORDER

          Denise J. Casper United States District Judge.

         I. Introduction

         Plaintiff John Consolo (“Consolo”) filed this lawsuit against Defendants Bank of America and NationStar Mortgage LLC (“Defendants”) bringing claims for breach of contract (Count I), promissory estoppel (Count II), negligent misrepresentation (Count III), breach of implied covenant of good faith and fair dealing (Count IV) and violation of Mass. Gen. L. c. 93A (Count V). D. 1-2. Defendants have moved for summary judgment. D. 50. For the reasons stated below, the Court ALLOWS Defendants' motion.

         II. Standard of Review

         The Court grants summary judgment where there is no genuine dispute as to any material fact and the undisputed facts demonstrate that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). “A fact is material if it carries with it the potential to affect the outcome of the suit under the applicable law.” Santiago-Ramos v. Centennial P.R. Wireless Corp., 217 F.3d 46, 52 (1st Cir. 2000) (quoting Sanchez v. Alvarado, 101 F.3d 223, 227 (1st Cir. 1996)). The movant bears the burden of demonstrating the absence of a genuine issue of material fact. Carmona v. Toledo, 215 F.3d 124, 132 (1st Cir. 2000); see Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party meets its burden, the non-moving party may not rest on the allegations or denials in her pleadings, Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986), but “must, with respect to each issue on which she would bear the burden of proof at trial, demonstrate that a trier of fact could reasonably resolve that issue in her favor.” Borges ex rel. S.M.B.W. v. Serrano-Isern, 605 F.3d 1, 5 (1st Cir. 2010). “As a general rule, that requires the production of evidence that is ‘significant[ly] probative.'” Id. (quoting Anderson, 477 U.S. at 249) (alteration in original). The Court “view[s] the record in the light most favorable to the nonmovant, drawing reasonable inferences in his favor.” Noonan v. Staples, Inc., 556 F.3d 20, 25 (1st Cir. 2009).

         III. Factual Background

         For purposes of this summary judgment motion, the Court will consider undisputed facts taken from the parties' Rule 56.1 statements.[1] Consolo is the son of Mary Consolo, who became owner of the property located at 262 East Eagle Street, East Boston, Massachusetts (the “Property”) in 1984. D. 52-1 at 5 (Consolo's Deposition). In 1996, Mary Consolo transferred ownership of the Property to Consolo and his brother, Gaetano Consolo, by quitclaim deed. Id. at 13-14; D. 52-2 at 72. In doing so, Mary reserved a life estate for herself in the Property. D. 1-2 at 6. In 2000, when Mary was 85 years old, she signed a power of attorney appointing Consolo to manage her affairs. Id. At that time, Consolo resided at an apartment on the Property (and he continues to live there). Id.; D. 52-1 at 5.

         In 2009, the Consolos decided to seek a home equity conversion loan (also known as a reverse mortgage) (the “Loan”) secured by the Property. D. 1-2 at 7. At or about this time, Gaetano Consolo, gave Consolo a power of attorney to allow him to apply for the Loan on Gaetano's behalf. Id. at 7-8. Consolo called Bank of America and spoke with Tim Keough (“Keough”), to discuss whether his family would be eligible to obtain the Loan. Id. The two communicated about the Loan solely through telephone and e-mail. Id. Initially, Consolo applied for the Loan on the Property in Gaetano's name. Id. at 8; D. 52-1 at 33. Consolo's objective from the beginning of this process was to secure a Loan that would also allow Mary, Gaetano and himself to live in the Property until they died. D. 52-1 at 32. Understanding that his family could maximize the cash from the Loan by basing it on Mary's age as opposed to Gaetano's age, D. 1-2 at 8, [2] Consolo decided to apply for the Loan on the Property in Mary's name and again completed the Loan counseling over the phone. Id.

         To effectuate the Loan, Keough sent Consolo a packet of documents to sign. Id. at 9. The adjustable rate home equity conversion mortgage (the “Mortgage”) stated the following:

THIS MORTGAGE (“Security Instrument”) is given on April 24, 2009 (“Date”). The mortgagor is John G. Consolo and Gaetano F. Consolo, as tenants in common and Mary Consolo, reserving a Life estate whose address is 262 East Eagle Street East Boston, MA 02128 (“Borrower”).

         D. 52-2 at 23. On the signature page of the Mortgage, the document read:

BY SIGNING BELOW, Borrower accepts and agrees to the terms and covenants contained in this Security Instrument and in any rider(s) executed by Borrower and recorded with it.

         D. 52-2 at 32. Underneath this statement, Bank of America included signature lines for each of the three Consolos with their preprinted names underneath each line: “Mary Consolo, by John G. Consolo, her attorney in fact;” “John G. Consolo, as remainderman;” and Gaetano F. Consolo, remainderman, by John G. Consolo, his attorney in fact.” Id. Consolo signed the Mortgage on behalf of all three. Id. The Mortgage also contained the following acceleration clause:

9. Grounds for Acceleration of Debt
(a) Due and Payable. Lender may require immediate payment-in-full of all sums secured by this Security instrument if:
(i) A Borrower dies and the Property is not the principal residence of at least one ...

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