happened here the first one of the most important one is an e mail from was a risk manager at ice or which is the first service or here i serve servicing and it's from her to an attorney by the name of gilbert ormond who was retained by mr pittman to assist him to get a permanent loan modification she investigated the matter and responded to mister gilbert's request for a print of the loan modification by saying i'm addressing is the fact that there is an admission by all the parties that there was a a temporary loan modification agreement calling for three payments a reduced amount those payments were made and a permanent loan modification of given should have been sent to mr pittman in by april one of two thousand and thirteen so i don't think there's any question about the three trial service representative that the agreement had been performed once and the page number a reference to that if that usually says page id in the upper right yes it is docket fifty six page id eighty five ok thank you and if i just might quote it it says please allow me to bring to it because i mean to provide some background in this account to the borrower or was any trial modification what i serve in december two thousand and twelve and made all payments on time contractually in titling him to a permanent loan modification in april two thousand and twelve this is from between i serve and b s i in a fact that is yes and are you a permanent loan modification to mr pittman she is saying that mr pittman performed the agreement and that mr pippin was contractually intitled to a permanent loan modification and that is exactly our position in this case the offer of a temporary loan modification agreement that's the t p p notice that was sent to mr pittman that was signed by the loss mitigation department of i serve and that says you make three payments and you're going to get a loan modification agreement from a loan modification of him and there's this document appears in many places in the record if i could just quote from it under frequently frequently asked questions  on the first page at the bottom now i'm sorry this is docket sixty one dash three page id ten thirty four when will i know if my loan can be modified permanently and how will the modified modified loan balance be determined answer once you make all of your trial period payments on time we will send you a modification agreement detailing the terms of the modification loan any different between the amount of this trial period payments and your regular they didn't in do that right you did not that's the whole case they never did it and they admit i did write whatever i mean the problem is that that's not in a fact f a q it's not an enforceable agreement itself in particular because it never says what the terms of the modification agreement will be you might have a little more traction if it said we will send you a modification agreement with the following terms but there can't be that this can't be an agreement for the particular modification agreement because there are no terms in it well i disagree with that judge determines or set forth in the first page which shows payments of thirteen hundred fifty seven dollars and eighty cents and then says this may be adjusted it has to be adjusted because the arrearage at that point which was two months for august and september is going to be added to the unpaid principal so the monthly payment is going to go up somewhat and there may be off also issues of taxes or insurance that's been paid so that that figure that's in them in the i mean just telling me that it's not definite when it's even if you rely on your mortgage will be permanently modified it might be modified to a ten year term a twenty year term of you know whatever is the amount it seem odd to maybe adjusted the monthly amount to maybe adjusted the term is not could be changed how do you know does it say that it's it just says your mortgage will be permanently modified if i've missed it someplace else let me know but it says your existing requirements remain in effect during the trial period but at least as i would read that the the the service or the lender could say ok here's a modification it's for this much for twenty years but from the different amount for thirty years if you're going to change the length of the of the agreement that would have been set forth in the trial modification plan the only change or why do you say that it is not set forth in there why do you say that you you would have i can imagine bankers doing all sorts of things because they're saying don't you're time's running out let me ask you quickly with respect to the reporting you presented these the stuff from the hamp handbook about how they should report things and in particular you know as i read it even if you can report that it's delinquent you should also report that it's on a trial period or something of that sort in my eyes following your claim correctly yes as i read their claim they they sort of sounds like they might or they don't need to but they also sort of say they did do it is there any kind of document that shows exactly what they reported or anything that would be in your view that we should look at to see whether they did report that you were on the p p or a modification plan well that they have guidelines and i think it's section twelve i've read that i'm not asking what's in them i'm asking is there any support for their saying that they did do something like they should have no i didn't they didn't their notes that they didn't all of want to know every port they said they didn't even know they needed to make a report and if you look at there are the answers from the credit reporting agencies they were sent to my client after the speed letter was sent and if you look at the if you look at the credit reports and i think they're attached to our docket number eighty eight it's off top of my head but they're attached to our motion for summary judgment they do not indicate that there's any reporting and either could report a credit report from b s i or from my service to any partial payment plan and that's what they were supposed to report and they were supposed to report a at pacifica and judge roberts never decided that motion that's my last argument in the case that we should be allowed at pacifica to this case then we sued pacific in a separate action but under the ham program it is the service or who has the this court should affirmed the district court conclusion that the appellant's claim fails because there was no in forcible loan modification agreement and as a result the information contained in his credit report was not inaccurate which is an absolute an accuracy is an absolute requirement of an f d r claim under michigan law what what the what the appellant has referred to as the lender liability statute of frauds the financial institutions promise regarding the financial comply with the lender liability statute of frauds which provides that a promise or commitment to renew extend modify or permit a delay in repayment or performance of a loan extension of credit or other financial accommodation must be in writing and signed by the authorized agent in our brief sets forth numerous courts in this circuit and specific to the michigan federal court that says that loan modifications have to be in writing and signed by an authorized representative of the financial institution we don't have that here it and we've cited this and in our brief one court specifically and i think this sums it here the appellant can't satisfy that requirement because that the agreement be in writing and signed by an authorize agent as the district court observed as evidence of an in force a board remit mr pitman produced an unsigned copy of the t p p in an email from my service general counsel the t p the t p p however was not a loan modification agreement and it wasn't signed it only referenced the last medication department at the bottom of the first page in our brief says these out as well again numerous cases where michigan courts have held that were in agreement falling under the winter liability statute of frauds not signed by a representative of the financial institution that can't satisfy the statute of frauds we've also cited in your honour's have picked up on this as a matter of contract law the t p p could not have constituted a loan modification agreement because the essential terms are absent from the t that if he makes the three required payments he will be soon a modification agreement detailing the terms of the modified loan the t p does not reference what the new monthly amount will be it says that it's probably going to be close to do what the t p payments are going to be but that's not certain the t p doesn't say what interest rate is going to be charged for the loan modification in these last two are important the t p doesn't say what the unpaid principal balance of the loan modification is going to be obviously that's a that's a significant term that all parties should be aware of that is that the arrearages would also depend in effect on what interest your you were charging him during the trial period which isn't actually specified rect interest there is late fees there are a set that are at play there are all sorts of numbers that could come into play that that would have potentially have a substantial impact on what the balance and at the bottom of the t p p in your view simply isn't a contract because if it were you would at least to violated it by not sending him a modification agreement of some sort absolutely it's very far from a contract here but it does say we will send you a modification agreement so terms are going that i understand i'm just saying yes that you have to tell me to some degree it's not a contract and we were i would respect like the answer to get to one other thing that you say you have ten and he has five or asked correct ok will still let me let me jump to this which is that on the reporting ok i mean i understand your argument that even though he's on a t p p he is still technically in default he didn't make the earlier payments and the t p p isn't the full amount even though you're in a forbearance situation but as i read the hamp rules and to me as a reasonable person there's a pretty big difference between just being flatly delinquent and beat in a conversation with the bank where they've agreed to let you do this t p p and as i read it that should have been reported and i said your adversary maybe i'm wrong i thought somewhere in the weeds here one of you said and by the way we did anyway i'm i wrong about that or are you relying on you didn't need to say that there was any kind of forbearance or t p it would be our position your honor that reporting the forbearance of the t p is at the discretion of the furniture in this case i serve and i'll read you the specific language from that section of hand that says if the borrower was delinquent at least thirty days past the due date prior to the trial period and the reduced payments do not bring the account current service or must and i emphasize the word must report the account status code that reflects the appropriate level of delinquency following the usual and customary reporting standards that's precisely what i sort of did now that section twelve goes on to state the service or reports the modification when it is completed as well the last sentence that i think your honour's re referring to says the service or should and again i emphasize the word should compared to the word must previously in that section of the service or should also report the special comic code ac that being that the payment is under partial or modified payment agree so it's our position your honor that section although section twelve of that particular section of hamp encourages services to report that there's a clear distinction in the language between servicers must reporting report incomplete or inaccurate information isn't the failure to report the t t t p p inaccurate were incomplete to me because now and they asked the  obligation would have been to modify the report i i have no problem with your saying that it hurts their credit might hurt their credit all of that but isn't it incomplete or inaccurate if you don't report the fact of the t p we don't believe so your honor i think to the extent that anything would arise once the loan modification would be finalized at that point there may be duties to report the loan modification  but as far as the t p pay and there's other hamp guidelines section eight point four specifically says that the payments should be applied and the normal course and in applying them that way the exist least for me i don't have any problem with that part of it but would you agree that to a user of credit there's a difference between a guy who's just skipped off to the bahamas and not paid for a long time and a person who is on a t p p and in fact is making his payments there is but but but the the issue here is whether or not under the at c r a with regards to this to the furnishers the issue is not whether or not the account is accurate it's whether or not they conduct a reasonable investigation because in accuracies are permitted there was the t p p it's not a question of the reason you reasonable most of your knowledge right because you knew it was there right that is correct and we would hope we would fall back on that section on twelve language that just says the service or should report it but that that the absence of the word must in our opinion doesn't make it x absolutely required i say that i want to know so your was sent almost a year after i serve stop servicing the loan and it's clear in the email that the council is saying based on her understanding of what she understands of hamp and what she has been told by  then there are a number of conditions regarding how the loan will be modified and what the conditions of that would be and i will go through all of these but modify your loan and so but it at the same time while you're making these payments and even if we modify your loan all of the original terms of the mortgage and of the node are still going to apply you have to comply with those and so for instance you have to you can't let if for instance under the mortgage if you have a second lien on the property you have to know the notify the mortgage the mortgage company or the service or all of those things that come into play that are in there the core of the he was but that but that that those payments and this was said on the p p those payments are going to be applied in the normal course and so because he was in he was in default and delinquent when those payments come in they're held in a separate account until there's enough money to pay the most the oldest delinquent payment and so but by making his tepee reduced payments at the time that understanding as to some of these things he skipped two payments before he even applied for the t p p on her and so by the time that he actually made the first payment under the t p i think there were four or five payments that had not been to be delinquent i mean if that is it wouldn't be that he would never catch up because because of the way the payments are going to be applied that could present itself your honor i don't think that's the intent of what was going to happen the problem is that the loan modification wasn't modified permanently modified prior to when i serve stop servicing the law i take it that that if a permanent loan modification was offered and agreed to that might have been the same amount but it might have been a greater amount it might have been a lesser amount but if it was a modification then it would wipe out whatever the previous that as part of the modification it would you know make some settlement of that it would say because you're remodification it could be whatever the arrearages yes but the credit reporting is one of the better reporting right now and i'm sticking to the modifications just going to the point that there seemed to be an implication that if there was a modification it would be at exactly thirteen fifty seven eighty and i'm saying my understanding that's not right more could have been last depending on what's happening in the world in the one other thing that i would add is that the terms of the loan would have to be adjusted for if this was a twenty year mortgage and  council that part i'm seven times of bad economic stress people do all sorts of things right you know if he's now seems to be a good guy and he says hey if you'll knock the loan down twenty thousand i'll enter this and i'll pay you fifteen hundred a month you might have gone forward in two thousand that's possible and twelve right i've been saying just this whole thing is up in the air it's not a contract yet on both sides right i would agree with ok that's all and that's the last point that i would make is that that i've tried to touch on entering into the loan modification and the dependent hasn't produced anything to suggest otherwise intervene into law modification doesn't wipe the slate clean on the payment history and that's what's at issue here the payment history there's been no denial that he was delinquent and some cases seriously delinquent on the payment histories prior to and as part of the entering into the t p people understand your point here i mean if that the i have to pay miss would be added to the end of the reconfigured loan would be added at the end of the loan that's the past due amounts there's a there's a difference between the past due amounts if those are going to be added to the to the balance that's one thing but if if if he's missed five months worth of payments and he enters into it and those rip those five months are reported as the lin regardless of what happens so the but the the amount owed for those five months are going to be handed to the unpaid balance you're saying he still delinquent on their language historical fact direct that's the reporting history is is his it is what it is ok good morning may please the court your honor i'm a christian millet on behalf of b s i as a subsequent service or our arguments are essentially the same for all intents and purposes as as i appellate just can't get around the fact that there was no permanent loan modification the court properly recognised that in order for it being a forcible agreement a loan modification must be signed by both the borrower and financial institution that's the out between the well it's my understanding the first while the t p pay was offered by i served prior to the service transfer the service transfer was in june of two thousand and twelve and the t p p called for the borrower to make three payments i believe it was early two thousand and twelve at that point according to the face of the t p once the borrower made those three payments that a proposed modification a permanent loan modification would be sent to and executed by the bar where then it would have to be also executed by the lending institution or the service or here at the time would have been i serve and then when it was transferred to us in june of two thousand and twelve there had not been  obligation is that kind of the that exactly it they were still saying that the spending the lower amount was thirteen fourteen you knew about all of these t p p documents though right we knew that the t p p was offered by ice or because that leads me t the question i have as to different which is their breach of contract claim which is as i understand the facts and tell me if i'm wrong you took the money and never paid the property taxes well the property taxes were eventually taken care of and actually the property has  since been sold but with that said you didn't take it for a while and he had and he at least the allegation is he had to pay them so that is some damage that was the i ability but that's damages and yeah but the court also concluded your honor the memory concluded i'm just going at it piece by piece so let's talk about is there liability and the question there is you're position is i take it you know that they breached first breach first question are you familiar with our courts moderately recent case of versus hudson city savings bank six thirty six that appendix three nineteen which says that missing a couple of payments is not an initial breach in this type of is not a breach th justifies breach on the other party side because normally and a preliminary breach has to make it impossible to continue to perform and here we've got money on both sides usually if you know you've  it stands for the proposition that one who commits the first stansell breach cannot mean i didn't actually always what is a substantial breach is failing to make a couple of payments a substantial breach something that allows you then just to keep your money and not pay the property to out we believe that the trial court here determined that failure to make the payments in august of two thousand and eleven as well as a time of was a substantial brief because the escrow account would have been deficient at that point in order to cover the taxes i'm sorry to say the escrow account would have been that the the t p p fact refers to that it says it should be sufficient to pay the property taxes but it says if you insist respectively says there might be an escrow when you have a piece of real estate you think there's a substantial reach when mortgage foreclosure has been instituted in missing a couple of pain in the in the redemption period and all that i don't wasn't involved and once this once litigation came in it was been put aside and hasn't been moved for closure and eventually now it's not even an issue because that property has been sold after a lot of a program of the cation through this litigation it was joined by all the parties in september twenty sixth seen back to your back to your point i believe that missing a couple payments in august and september of two thousand and eleven constitutes a substantial breach an even more so the yeah well i would say that with regards to you with regard to the servicing of the loan if you're making if you're not making your payments that constitutes national breach which usually results in foreclosure proceedings thank you thank you very much it there's so much there that was said but especially mr lee that i don't really have time to respond to all of it i just want to make a couple things clear first of all when he's in a when he interprets the camp guidelines saying that they don't have to make partial payments because he uses the word should well have guidelines or not statute so they're not going to use the word must or shall they're going to say this is what you should do it wouldn't go through all the trouble of setting forth the criteria for making partial payments the code you're supposed to report without intending that the service should do so even if you didn't have the hamp guidelines you still have the first good reporting act there are cards that information be complete and accurate and you've got the regulations of the consumer financial protection bureau that i quote that say that you are supposed to provide information that which if not provided would provide a misleading picture about the about the dead or misleading picture is is something that doesn't fully provide a full indication of the character and the performance of the of the doctor and that and that applies in this case because and the word they use in the regulations is integrity not just actually but also integrity you're supposed to present a fair picture of the debtor not a one sided even technically accurate picture of the debtor and that did not happen in this case because it did not make credit reporting what they admit in their notes they didn't even they didn't even know they had to ice or didn't know what the what happened is that christian because she at b s i told orman on march twenty sixth two thousand and thirteen having to continue to make the trial payment amount i will get the mob payment as close as close as i can to that so that's what happened i served didn't follow through and send the permanent loan modification agreement because i said continue making payments with it for the ongoing period of time indefinitely until we get t straightened out they never strained it up most of the question of what documents being enforced we're not saying we're enforcing a permanent loan modification agreement that agreement was never entered into because it was never mailed by i serve but i serve was obligated to mail that under the terms of d p p notice which is a which is a binding contract it was signed electronically by the loss mitigation department of i serve in bond i service on that green when the three payments were what we would normally do at least my copy and i'm not sure this is my clerks there's sort of a screw or scrawl to the left but is it just the words loss mitigation department count i would say so yes because it  who is sending it and shows lots of things identify i mean i get a blank and i it says danny j bugs under it that identifies it but if i don't you know signed it it's not a signed document but you have  oh yes i think the leading case of why god involves exactly the same type of signature from from as from the seventh circuit it's widely followed including in the circuit and i think in that case there was just a written signature fargo bank made in white god they're saying well it was never any permanent loan modification seven circuits and well of course it wasn't you didn't do your job you didn't do what you were obligated to do they are the ones who are to blame for there not being a permanent loan modification they're the one to blame left to hang out there for four months not knowing what was going to happen being afraid of what was going to happen it regarding his house not knowing what it would damages he might suffer from from a bad credit reporting so this is