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Hutchinson v. Bank of America, N.A.

United States District Court, D. Massachusetts

July 3, 2019

WILLIAM L. HUTCHINSON, Plaintiff,
v.
BANK OF AMERICA, N.A. as successor by merger to LaSalle Bank N.A. as trustee for WAMU Mortgage Pass-Through Certificates Series 2006-AR17 Trust; U.S. BANK, N.A., Successor trustee to Bank of America, N.A., successor in interest to LaSalle Bank, NA, as trustee, on behalf of the holders of the WaMu Mortgage Pass Through Certificates, Series 2006-AR17; SELECT PORTFOLIO SERVICING, INC.; and DOONAN, GRAVES & LONGORIA, LLC, Defendants.

          ORDER ON MOTIONS TO DISMISS AND REMAND (DOC. NOS. 4, 8, 22)

          Leo T. Sorokin, United States District Judge

         On November 15, 2018, plaintiff William L. Hutchinson brought this suit in Nantucket Superior Court, advancing a variety of claims related to the September 2018 foreclosure sale of his Nantucket property. Doc. No. 1-1. On November 26, 2018, defendants Select Portfolio Services, Inc. (“SPS”); Bank of America, N.A., as successor by merger to LaSalle Bank N.A. as trustee for WAMU Mortgage Pass-Through Certificates Series 2006-AR17 Trust and U.S. Bank, N.A., successor trustee to Bank of America, N.A., successor in interest to LaSalle Bank, N.A., as trustee, on behalf of the holders of the WaMu Mortgage Pass Through Certificates, Series 2006- AR17 (collectively, “the Trustee”); and Doonan, Graves & Longoria, LLC (“DGL”) removed the case to this Court. Doc. No. 1.

         On November 27, 2018, DGL moved to dismiss themselves as a defendant, Doc. No. 4, which Hutchinson opposed, Doc. No. 7. On December 17, 2018, Hutchinson moved to remand the case to state court, Doc. No. 8, which SPS and the Trustee opposed, Doc. No. 25. Finally, on January 8, 2019, SPS and the Trustee moved to dismiss the case in its entirety, Doc. No. 22, which Hutchinson opposed, Doc. No. 28. The Court held a hearing on all three motions on May 23, 2019, and again on June 28, 2019, and all are now ripe for decision.

         I. BACKGROUND[1]

         Hutchinson acquired the property at 3 Skyline Drive in Nantucket by quitclaim deed executed on February 14, 1985. Doc. No. 1-1 ¶ 15; Doc. No. 9 at 30. On October 18, 2006, as part of the refinancing of the property's mortgage, Hutchinson executed a promissory note in the amount of $1, 000, 000 in favor of Washington Mutual Bank, F.A. (“WaMu”). Doc. No. 1-1 ¶ 17; Doc. No. 9 at 35-44. To secure the note, Hutchinson also granted WaMu a mortgage on the same date. Doc. No. 1-1 ¶ 17; Doc. No. 9 at 46-67. The mortgage was recorded in the Nantucket Country Registry of Deeds (“the Registry”) on October 23, 2006. Doc. No. 1-1 ¶ 17.

         On September 25, 2008, WaMu was closed by the Office of Thrift Supervision and placed into receivership by the Federal Deposit Insurance Corporation (“the FDIC”). Doc. No. 9 at 70. An affidavit filed with the Registry on October 27, 2018, stated that, as a result of WaMu's closure, “JPMorgan Chase became the owner of the loans and loan commitments of [WaMu] by operation of law.” Id. at 69-70. In late 2009, Hutchinson stopped making payments on the mortgage. Id. at 191, 276, 335.

         On April 12, 2010, JPMorgan Chase assigned the mortgage and the promissory note to Bank of America, N.A., as successor by merger to LaSalle Bank N.A. as trustee for WAMU Mortgage Pass-Through Certificates Series 2006-AR17 Trust. Doc. No. 9 at 135.

         On June 29, 2010, attorney Janie Ranney wrote to Bank of America on Hutchinson's behalf, requesting information and documents about Hutchinson's mortgage. Id. at 421. Bank of America responded that it could not “identify a loan number associated with the correspondence.” Id. at 428. On August 4, 2010, Ranney again wrote to Bank of America, explaining that Ranney's first letter had included the loan number. Id. at 420. On August 24, 2010, Bank of America responded again that it could not “identify a loan number associated with the correspondence.” Id. at 438. On September 2, 2010, Ranney again wrote to Bank of America to inform the bank that its “failure to have such required disclosures . . . and to provide copies thereof to me upon valid request makes this loan transaction rescindable, on an unlimited basis.” Id. at 417. Ranney further wrote that “you may consider this letter a formal Notice of Rescission of my client's loan.” Id. Bank of America did not respond to Ranney's third letter. Doc. No. 1-1 ¶ 90.

         On August 1, 2013, SPS acquired the servicing rights to the mortgage from JPMorgan Chase. Doc. No. 9 at 190. On October 30, 2017, Bank of America, N.A., as successor by merger to LaSalle Bank N.A. as trustee for WAMU Mortgage Pass-Through Certificates Series 2006-AR17 Trust assigned the mortgage to U.S. Bank, N.A., successor trustee to Bank of America, N.A., successor in interest to LaSalle Bank, N.A., as trustee, on behalf of the holders of the WaMu Mortgage Pass Through Certificates, Series 2006- AR17. Id. at 326-28.

         On June 7, 2018, SPS sent Hutchison a “payoff statement” for his loan that indicated a total amount due of $1, 453, 009.79. Id. at 454. On July 26, 2018, SPS notified Hutchison that a foreclosure sale of the property was scheduled for September 6, 2018. Id. at 449.

         On August 30, 2018, attorney Thomas Vawter wrote to SPS to ask them to cancel the foreclosure sale so that Hutchinson could sell the property himself. Id. at 482. Vawter wrote that, based on a projected listing price of $2, 495, 000, the proceeds from the sale would be more than sufficient to pay off the balance of the mortgage. Id. The letter also stated that SPS would be liable for any different between the listing price of $2, 495, 000 and a lower sale price in foreclosure and requested a payoff amount good through September 30, 2018. Id. SPS refused to enter into a forebearance agreement or to cancel the scheduled foreclosure sale. Doc. No. 1-1 ¶¶ 102, 103.

         On September 6, 2018, the defendants held a foreclosure sale at the property. Id. ¶ 104. The bidding began when attorney Patrick Beaton of DGL bid $1, 461, 333.31, and ended after Greg Dorsey bid $1, 700, 000. Id. ¶¶ 105, 106.

         Hutchinson now advances five causes of action. Count I is an action to quiet or establish the title to land under Mass. Gen. Laws ch. 240, § 6. Count II is a declaratory judgment action under Mass. Gen. Laws ch. 231, § 1. Count III is wrongful foreclosure action. Count IV is an unfair debt collection practices claim Mass. Gen. Laws ch. 93, § 49. Finally, Count V is an unfair and deceptive practices claim under Mass. Gen. Laws ch. 93A, § 9.[2]

         II. L ...


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