remarks on four topics that i know there's a lot of issues to be presented in the briefs the first topic i wanted to focus in on is whether or not auckland conduct in connection to a loss mitigation application submitted in february of two thousand conduct in february of two thousand and fourteen did not comply with the regulation then that arises the second issue that i want to discuss which is to what extent then can the court look at conduct that awkward had in two thousand and twelve and two thousand and thirteen to find that compliance as your owners are probably aware from the briefing in this case the effective date of the regulation was in january tenth two thousand and fourteen and so really what the second issue is focused in on is to what extent is there a re compliance and that really comes to the third issue which is whether or not mr germain gave at least some evidence that he suffered compensable damages as a result of the violation of the regulation and then finally daughters time allowing i want to hit upon the fourth issue which is whether or not mr germain has a viable claim under the texas debt collection act which is codified in the texas finance code so to start with the first issue which is whether or not an awkward conduct in february of two thousand and fourteen complied with the regulat at issue and your honors just to be blunt the answer is no not only is the answer no but in fact i don't even think arc which trial counsel thought the answer was yes because aqua's trial counsel argued in its motion for summary judgment that is really  the cumulative conduct in two thousand and twelve two thousand and thirteen and two thousand and fourteen which arose the compliance with the regulation and indeed as your honour's are probably well aware the lengthy opinion issued by the district court which is over thirty pages a significant portion of that opinion was going to whether or not the court could appropriately look at conduct in two thousand and twelve and two thousand and thirteen to find that compliance so really this new argument that's been raised for the first time on appeal  was an argument that was never really considered in the district court and for good reason in the answer is because in february of two thousand and fourteen our current conduct was facially and obviously non compliant with the statute and your honors that this catchy that we're talking about my statue in the regulation it only really requires three things first there were choir's that once it receives a compliant loss mitigation application which there is no dispute actually happened in this case it will choir's a loan servicer in this case auckland to review the borrower for all of the loss mitigation options and then to give written notice to the bar work of what loss mitigation options it will be provided to the borrower and it needs to do all of those things in thirty days so that's all we're talking about in this case what happened is is that mr germain submitted a loss mitigation application to auckland in february two thousand and fourteen auckland looked at it generated a form letter that says we  deny any requests for a loan modification but we provisionally grant you or at least provisionally approve you for a short sale what was obviously missing from that this is just the low hanging fruit is that there was no reference point you out to record citations because we actually took the deposition of the corporate representative for auckland this is at page nine hundred twenty seven of the record in the question was this so is it awkward position that even though they sent him a denial letter in february two thousand and fourteen based on his february two thousand and fourteen application that they were still considering him for forbearance at that time the answer was yes so what happened here is that  considering mr germain for other loss mitigation options available to him at the time it served a notice saying that this is all we're going to offer you so the statements that were made in the letter in february two thousand and fourteen  factually incorrect in fact there doesn't seem to be much contention argument that that those statements work in correct and in fact are quinn's position if i'm understanding their briefs correctly is that they're allowed to give factually incorrect statements in these letters and still be compliant with the statute how many did your client apply for medicaid based off this record it is three times the first time is two thousand and twelve the second was correct my prior statement he sent a fourth application in november of two thousand and fourteen and that's in the record the reason i'm saying that's incorrect is because mr germain of course the last time he was current was i want to see approximately two thousand and thirteen when he submitted it when he filed for bankruptcy of course he had defaulted in two thousand and thirteen and then he submitted the february two thousand and fourteen application and so based off of my understanding the record he had not been current probably since about two thousand and thirteen beginning of two thousand and thirteen however i can't tell you your honor when the loan was originated so it may be that he had the loan for some prior time before that but to i think address the issue that your honour's growing up which is the idea of gaming the system because that is obviously one of the focus of awkward position your honor the statue or the regulation issue does not provide an owner's burden all it requires is is that servicer review the application review the borrower for all options available to him and then give written notice of that and then do that within thirty days and so that the regulation was designed to provide a uniform it may be that auckland could very well and very easily have done that procedure and probably should have done that procedure of course in february of two thousand and fourteen added a few extra sentences in its letter did a few extra steps within the thirty day time period and then we would have no cause of action can be no reason for us to be here arguing about this case today but auckland fail to do that the remedy of course pursuant to the statute is that if you don't comply with the regulation is that you can't move forward with until you comply with the regulation and so your honour's just moving on to the second issue wanted to hit upon which is to what extent awkward can rely upon a pre regulation conduct in order to find that compliance so what has happened in the district court him for all of those options but we considered him for those options over the course of approximately three years two thousand and twelve two thousand and thirteen and then two thousand and fourteen you're going to get the effective date of the regulation wasn't until january tenth two thousand and effective date of the regulation and so all of the conduct that occurred in two thousand and twelve and two thousand and thirteen which is relied upon by auckland is simply not relevant and simply can't be relied upon on one and your honor there's also a different point than needs to be made which is there can also not be piece mail compliance meaning that you can't review a borrower for you know to the three options that he or she may be available they able to have in two thousand and twelve and then go work are legal basis for your i cannot point to the court to any case which is held that the reason the basis for the legal argument that i'm making regarding piecemeal compliance is based in the statutory language  or in the language simply says that once a borrower submit a timely complete loss mitigation application the service or must one a value wait the borrower for all lost medication options available to the bar or and then to give written notice and so the only way that that regulation makes sense is that considering that the duty doesn't trigger until on the receipt of a loss mitigation application from a timing standpoint it would just make sense from from just a plain reading of the statute that you know a an application is served step one step two then evaluate the borrower for all loss medication options available and then step three give written notice do all of that within thirty days because there is a thirty day time period being provided in the language itself says within thirty days of receiving the complete loss mitigation application a service or shall colon and then step one step two so based off of just point the plain meaning of the language in the regulation i would contend certainly mr germane to contends that there cannot be piecemeal compliance you can't simply centrally fail to comply with a a loss mitigation application server in a prior da issue being brought on by the police a violation the violation that we're alleging in this case of course is that you can't move forward with foreclosure walk until there has been compliance under the regulation and with debt collection act because there is a separate legal argument being made and that is whether or not there's an exemption for threats to foreclosure under the texas debt collection act there is however this court in the keg the wells fargo for example found that to the extent that a service or did not have the contractual right to foreclose but then threaten for closure and nonetheless that that would essentially avoid any sort of exemption under the texas debt collection act of course the court and broker a separate case which came shortly thereafter mccabe the wells fargo would indicate that just because there's an argument that someone failed to comply with a notice in the texas property code then that would not somehow waive a contractual right to foreclosure the reason why this case is very much different from both from from the record case is that we actually have a regulation which mandates that that foreclosure cannot occur and foreclosure cannot be moved forward until there has been compliance with the regulation and of course the deed of trust the actual language of the deed of trust that that is under line documenting alone is subject to a political law pursuant to just the  plain language of those terms and so the the actual contract they were arguing about is subject to the regulation that we're arguing about as well so to the extent that the regulation hasn't been complied with the actual language of the here please the court this isn't kidwell here for that billy's i'd like to talk about three things i'd like to begin with the loan history because i think that that bears on the issues of no duty and also the issues of no waiver which are issues that were brought up second i'd like to really focus on the twenty fourteen response because i think our compliance with the rest of regulate regulation requirements in february of two thousand and fourteen essentially moots any need for this court to consider some of the more difficult issues presented in the appeal and then third i'd like to just briefly explain why we were not prohibited from moving forward with foreclosure in twenty fifty with respect to the loan history this is a loan that's been in and out of default since two thousand and nine mr germain made his first loss mitigation application in two thousand and twelve and then promptly made a fairly big payment on the loan which essentially stopped any further review so that was the first attempt in two thousand and thirteen he requested another loss mitigation and both times in two thousand and twelve and twenty thirteen we told him that we could not do a loan modification because his lender does not allow that it's just a lender policy but in two thousand and thirteen we gave him an option of a deed in lieu of foreclosure as a way of avoiding foreclosure because twenty thirteen again his very behind on his mortgage and he's been having problems now for since two thousand and nine in twenty thirteen what did he do he didn't accept their offer instead he said he was going to file for bankruptcy to make things as difficult and often as possible and he did his bankruptcy petition was on the ventilate dismissed because he didn't do all of the paperwork that one needs to do to stay in bankruptcy and so twenty fourteen we get to february of two thousand and fourteen and again he's having problems with his payments back he hadn't made a payment since two thousand and thirteen period he's been living in his house since tw thirteen with no payments so this loan history i think it explains on the relevance of the twenty twelve and twenty thirteen loss mitigation applications and i think it shows why the district court was influenced by those because the district court probably picking up on this court's decision in one cell said look in two thousand and fourteen this was already the third loss mitigation application so there's really no duty to comply with the regulations  and whether the district court went on and ruled based on other applications is not entirely clear but i can say that our motion for summary judgment was based on the ground that we can with respect we actually said we complied not once not twice but three times so we were not arguing for piecemeal compliance we were saying that we complied multiple times and so this isn't the kind of case that can support an arrest but claim our motion was also based on an argument that there was no evidence of any actual damages that resulted from the alleged violations that were at issue so really the motion itself and all the court has to do is just look at that very briefly you can see that all of the issues we briefed t court were preserved so we're not arguing piecemeal compliance we're actually saying the simplest way the court can resolve this case is to focus on the february twenty fourth response and say ok by then the regs had just think that it's an issue of retroactivity because nobody is trying to apply the requirements in the regulation retroactively and i think the law is clear that the requirements don't apply until the right takes effect what we're seeing and i think what the district court was seeing is that those requirements only apply to a for the first loss mitigation application so our answer is it's not that anybody's trying to apply the reg retroactively the reg is just limited in to how it applies going forward it doesn't apply to a third application but again i don't think i mean there's authority going both ways on that so i think that would actually be a more difficult question for the court to consider i would just look at the the response that we had to the february twenty fourth enough location it's on page eleven of our brief and it's on page seven fifty two of the record and we've clearly got a written response it's clearly timely because it's done within thirty days of his up location it says that up when has evaluated  for all loss mitigation options i think what's key to that is you need to look at the bureau's official interpretation to see what the bureau is saying that means the bureau says a mortgage service evaluation is in the sole discretion of the servicer and the options that are available are the options that are offered at that time so in other words the fact that we might have offered the b and thirteen that option wasn't available in february two thousand and fourteen because we only offer one option we offered the option of the short sale the fact that mr germain then started contacting us asking about options that weren't available and hadn't been offered and that later on we offered a forbearance which he rejected you know again that doesn't mean that that option was available in two thousand and fourteen as a matter of law it wasn't we know that based on the written response saying that we can offer you a short sale and we know that from the bureau interpretation that says the options available are those off offered so i think that that's just a very clean answer to the question you know did w the position of the corporate representative who said we didn't consider him we did consider x y z she's got some each you sort of have to look at the whole thing she does have some some statements that have been taken out of context where she's saying you know yes at that time we were considering him for a a forbearance and i think when you look at the written record it looks like we started well doesn't matter the fact that we're considering him for a forbearance at the time of his  application it doesn't mean that it was an option that was available at that time because as even the other side has acknowledged parties went back and forth for about five months before they could come up with anything remotely you know possible given this borrowers long history of forbearance repayment options i mean he had already been demonstrating for five years that he was unable to make the payments that he had and so there was really just no workable plan you know again i think the fact that we continued working with him for another five months and then did offer him a forbearance plan which he rejected i think that that really just goes to show you know kind of digging its back to the big picture this is a borrower who is really having problems with his mortgage and often was trying repeatedly over a course of years to give him alternatives none of which he took no judge oh and if at the end of the day you think well this corporate rep you know this this raises some questions then i would say what what damages could possibly flow from the fact that we did not offer an option that was not available in february two thousand and fourteen because we need to evaluate but what damages could possibly flow from that she didn't accept the offer anyhow so it's not like a situation where all gosh she would have qualified for a forbearance in february twenty four team but we didn't offer it and then he lost his house and then he lost his job and then we said oh yeah we could have offered that that's not what happened we didn't offer it in tw fourteen because it wasn't available at that time continued negotiations again ongoing history of this loan it's just like once we respond to one application then his immediately calling writing asking for something else so we continue evaluating what's available at that time you know there's nothing in the record to explain the rationale as to why one options available but i think it just has to do with the the calculations that the service or makes given the loan history you know at one point they were willing to take a lieu once he's rejected that then that was off the table i think that the basically the forbearance and repayment plan i mean they just weren't workable for his loan history which is ultimately what for you to offer forbearance one after twenty four after  upfront payment which of course he couldn't do which is frankly probably why we didn't offer it in the first place because it just wasn't a viable plan for him but he kept insisting in wanting something else so we offered that you know again we think that the notice on  face complies but even if not the kind of shape or technical violations that we're talking about are failing to evaluate him for options that weren't available at the time again service or sole discretion options offered the only options available  that's with the bureau into how that's how the bureau interprets this requirement so you know why we exercised her discretion in certain ways that there's nothing in the record to speak  bottom line is we did offer one option in february two thousand and fourteen and he didn't take it just as he hadn't taken any other option at any other time the third thing i'd like to touch on is this idea that we were prohibited from for closing into we had issued a complaint notice that is simply incorrect the regulations say that a bar or a service or can't proceed with foreclosure unless one of three things happens and the first one is the borrower issues a response to a loss mitigation application and offers no options at all and if that happens then you've got to wait to the time to appeal has been exhausted so the time to appeal expires or if the borrower files appeal you've got to wait till the appeal is resolved that's not what happened because in february twenty third fourteen we did offer an option so that takes us into the second and third possibilities servicer can't proceed with foreclosure unless the borrower rejects all last mitigate options offered by the service or that's exactly what happened we offered a short sale he rejected it but we still didn't even proceed with foreclosure then we waited he filed another loss mitigation our application in november of two thousand and fourteen by that point we had already offered him a deed in lieu short sale forbearance we had talked about replanned repayment plans none of which were workable so we said there were no options available at that point his time to appeal expired and at that point we proceeded with foreclosure so the regs and i that the third thing is the regs say that you can't service or can't proceed with a foreclosure unless the borrower fails to perform under an agreement or a loss mitigation option in this is all in it's subsections subsections g s of the regulation you'll see all those and the official bureau interpretation shed some light on that and says quote if a borrower has not obtained an approved short sale transaction at the end of any marketing or listing period a service or may determine that a borrower has failed to perform under an agreement on a loss mitigation option so you know whether were in category two or category three whether he just rejected our offer of this as short sale or whether he failed to perform either way awkward was not prohibited from foreclosing invest in fact they were permitted just by the expressed language of the regulations so this kind of bootstrapping saying that you know we're liable under the t d ca because we violated respa that assumes that you we couldn't foreclose under arrest but and in fact respa gives us the exact authority to do that unless the court has any questions we'll stand on our br you i just wanted to focus first on the issue of how to interpret the phrase options available council for auckland indicates that essentially you know options available simply means that if mr germain would not have been authorized or approved for some form of loss mitigation then somehow that was quote a not option available and they were never required to give written notice of its decision in the first place that's not what the statute contemplates not what the plain meaning of the regulation indicates in fact i would urge the court to look at the official interpretations of what it means by options available and typically what that means is that whatever typical  options are going to be offered to to do the research costs are the quote options available and that makes sense of course is because why would the loan servicer ever need to give notice in the first place if walk options available is simply referring to options approved because the course of the regulation contemplates denials which is a fact what what has been happening to mr germain every time he asked for a loan modification they said i'm noticing option do not now is a quote option available but it was not a quote option approved and so mr certainly counsel forced auckland's interpretation of what options available quote unquote are supposed to mean it's just not supported by the official interpretations of the regulation is not supported by saying they have to offer everything they have to say these options less than say these are available but not to you tell me your honor options available as contemplated by the regulation and  interpretation simply means whatever loss mitigation options are generally available to the customer of the customers of the loan service loan service or so for example from the millions of people that awkward services excuse awkward from considering all borrowers for all quote all options available so there is a distinction between what we are throwing to as options available and ultimate approval for loss mitigation why is that important distinction it's an important distinction because mr germain was dramatically obviously not considered for quote all options available in fact the corporate representative indicated that he was being actively considered for a forbearance agreement and he what wasn't being  lieu because according to the corporate rap mr demain at some time in the past it indicated that he wanted to keep the property while that's still not compliant under the regulations regulation provides a very uniform method of processing lost mitigation applications and it's there for specific reason provide very minimum basic protections to borrowers in these sorts of cases where they're facing foreclosure and so the options available to mr germain in february two thousand and fourteen pursuant to what service or afterwards you of quote all options are saying they should have listed your options available but we're not going to make any of these avail your honor i'm not going to say that that the loan servicer in its notice needs to list all options available what the loan servicer needs to do is at least review the borrower for all options available and then in the written notice indicate which options he or she has been approved for in this case and that's why awkward counsel really focused is on the language in the in the letter because the letter actually says we have considered you for all options available and we hear by offer you this one option you're taking as a factual matter you're saying they lied that that is correct as purely a backhoe matter he was found out and discovery that every time we get a notice that we consider all options and you don't qualify for any of them we can stop the foreclosure intake depositions to see if in fact they did consider the person for all these options your honor i'm not going to say that we that those things have to happen but does a house which you now know on t l c can comply i mean another words seems like you're saying you have to you have to have the right to go behind it so would you really in fact consider me i believe a borrower to the extent that there is some good faith basis to file a lawsuit that in fact the borrower is not considered for all options available in the borrower would have a credible claim for a violation of regulation which may be proven out discovery in this case mr germain you are what what should thank you been they say they considered him what would have been available for had they considered it why and that's because they were actively considering them for for that repayment plan at that time pursuant to the testimony that we've seen and eventually they did send out some form of repaying that plant some by months later which again is a violation of the stack or the regulation under the mortgage so what's happening here you're saying you could prove you can produce evidence that had they made a forbearance offer with a prepayment repayment plan in february fourteen there's evidence he could have complied with that your honor i would say that that was not the the argument that was being made in the district court the reason i'm saying this is because i don't have the record to make that argument to you today so all i can tell you is is that we would love to make that argument in the district court but i don't have the record to indicate whether or not mr could have complied with forbearance agreement february two thousand and fourteen i just don't know