Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca5-15-10373/USCOURTS-ca5-15-10373-0/pdf.json

Parties Involved:
Bank of America, N.A.
Appellee
Diana Rucker
Appellant
Wells Fargo Bank, N.A.
Appellee

Document Text:

REVISED DECEMBER 4, 2015

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 15-10373

Summary Calendar

DIANA RUCKER, 

 Plaintiff–Appellant,

versus

BANK OF AMERICA, N.A.,

 as Successor by Merger to BAC Home Loans Servicing LP 

 as Successor to Countrywide Home Loans, Inc.; 

WELLS FARGO BANK, N.A., as Trustee for the Certificate Holder of 

 Park Place Securities Inc., Asset-Backed Certificate Series 2005-WCW2,

 Defendants–Appellees.

Appeal from the United States District Court 

for the Northern District of Texas

Before REAVLEY, SMITH, and HAYNES, Circuit Judges.

JERRY E. SMITH, Circuit Judge:

Diana Rucker appeals a summary judgment in favor of Bank of America, 

N.A. (“BOA”), regarding her default on a home mortgage. Rucker specifically 

appeals the conclusions that Section 51.002(d) of the Texas Property Code does 

not give rise to a private cause of action and that claims under the Texas Debt 

Collection Act (“TDCA”) are subject to the economic-loss rule. We affirm on 

other grounds. 

United States Court of Appeals

Fifth Circuit

FILED

November 20, 2015

Lyle W. Cayce

Clerk

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I.

Rucker bought her house in 2005 with a $175,000 loan from Argent Mortgage Company, LLC (“Argent”), executing a note and deed of trust. Argent 

assigned the deed of trust to Wells Fargo Bank, N.A. (“Wells Fargo”), and BOA 

is Wells Fargo’s loan servicer.

Rucker defaulted in October 2007. She alleges that, on multiple occasions between 2008 and 2012, she communicated with BOA about modifying 

the loan but that BOA consistently denied her requests, failed to respond, or 

misrepresented the status of the loan. On January 15, 2010, BOA sent Rucker 

a notice of default indicating that it planned to accelerate the loan on February 14 if she did not bring it current. She failed to meet the deadline. 

BOA initiated foreclosure in August 2012. Rucker sued BOA and Wells 

Fargo in state court in April 2013, alleging, among other claims, that BOA had

violated the Property Code and TDCA. BOA removed to federal court, which 

granted summary judgment. 

II.

We review a summary judgment de novo. LeMaire v. La. Dep’t of Transp. 

& Dev., 480 F.3d 383, 386 n.12 (5th Cir. 2009). We “may affirm [the] judgment 

on any grounds supported by the record.” Palmer ex rel. Palmer v. Waxahachie 

Indep. Sch. Dist., 579 F.3d 502, 506 (5th Cir. 2009) (citation omitted). 

III.

Rucker asserts that BOA violated Section 51.002(d).1 She does not bring 

 

1 The section provides,

 Notwithstanding any agreement to the contrary, the mortgage servicer of the debt 

shall serve a debtor in default under a deed of trust or other contract lien on real 

property used as the debtor’ residence with written notice by certified mail stating 

that the debtor is in default under the deed of trust or other contract lien and giving 

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a wrongful-foreclosure claim but instead maintains that that subsection confers an independent private cause of action. The district court granted summary judgment on that claim, reasoning that Section 51.002(d) authorizes only

a claim for wrongful foreclosure.

Even if, arguendo, Section 51.002(d) authorizes a private cause of action,

Rucker fails to state a claim.2 The statute requires that the loan servicer provide notice of default and at least twenty days to cure before giving notice of 

sale. BOA offered undisputed evidence that it sent Rucker a notice of default 

on January 15, 2010, informing her that she had until February 14 to avoid 

foreclosure by making all payments due since October 2007. Rucker does not 

allege that BOA attempted to send her a notice of sale or to initiate foreclosure

before February 14. The January 15 letter gave her notice of the default and 

provided more than the required twenty days to cure it. The Section 51.002(d) 

claim fails as a matter of law.

IV.

Rucker avers that BOA’s communications with her between 2008 and 

 

the debtor at least 20 days to cure the default before notice of sale can be given under 

Subsection (b). The entire calendar day on which the notice required by this subsection is given, regardless of the time of day at which the notice is given, is included in 

computing the 20-day notice period required by this subsection, and the entire calendar day on which notice of sale is given under Subsection (b) is excluded in computing 

the 20-day notice period.

TEX. PROP. CODE ANN. § 51.002(d).

2 Although the Texas Supreme Court has not decided this issue, the federal district 

courts that have addressed it seem to conclude that Section 51.002(d) does not intend an 

independent private cause of action. See, e.g., Anderson v. CitiMortgage, Inc., No. 4:13-CV369, 2014 WL 2983366, at *5 (E.D. Tex. July 1, 2014); Ashton v. BAC Home Loans Serv., L.P., 

No. 4:13-cv-810, 2013 WL 3807756, at *4 (S.D. Tex. July 19, 2013); Hill v. Wells Fargo Bank, 

N.A., No. V-12-11, 2012 WL 2065377, at *7 (S.D. Tex. June 6, 2012). But see Sanchez v. Bank 

of Am., N.A., No. 3:14-cv-2571-B, 2015 WL 418084, at *5 (N.D. Tex. Jan. 30, 2015) (refusing 

to dismiss claim under Section 51.002(d) on Federal Rule of Civil Procedure 12(b)(6) motion);

Hernandez v. U.S. Bank, N.A., No. 3:13-cv-2164-O, 2013 WL 6840022, at *6 (N.D. Tex.

Dec. 27, 2013) (same). 

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2012 violated Sections 392.301(a)(8), 392.303(a)(2), and 392.304(a)(8) of the 

TDCA. The district court granted summary judgment on those claims, believing that the economic-loss rule applies to TDCA claims. After summary judgment, but before the parties filed briefs on appeal, we decided, in McCaig v. 

Wells Fargo Bank, N.A., 788 F.3d 463, 474–75 (5th Cir. 2015), that the 

economic-loss rule does not bar TDCA claims. That is of no moment, however,

because we affirm on a different ground.3 

Section 392.301(a)(8) prohibits mortgage servicers from attempting to 

recover an outstanding loan by “threatening to take an action prohibited by 

law.” TEX. FIN. CODE ANN. § 392.301(a)(8). Rucker alleges that BOA’s threatened foreclosure was prohibited by law because BOA had not yet given the 

statutorily required notice of acceleration. Rucker cites McCaig for the proposition that “[i]n determining whether foreclosure would be prohibited by law [] 

what matters is whether the mortgagee has a right to foreclose, not whether 

the debt is considered in default.” McCaig, 788 F. 3d at 478. 

Rucker mischaracterizes McCaig, in which we decided that a mortgagee

violated Section 392.301(a)(8) by threatening to foreclose after specifically 

waiving its right to do so. Id. at 477. By contrast, we reasoned that the mortgagee would not have violated that subsection if it had retained its contractual

right to foreclose and the mortgage was in fact in default.4 Here, BOA never 

 

3 One may justifiably posit that Rucker has waived her TDCA claims by failing to 

assert them in her initial brief, though she raises them in her reply brief. See DSC Commc’ns 

Corp. v. Next Level Commc’ns, 107 F.3d 322, 326 n.2 (5th Cir. 1997). Rucker’s initial brief 

asserts only that the district court erred by applying the economic-loss doctrine to claims 

under the TDCA but does not mention McCaig or the merits of her TDCA claims. We decided 

McCaig on June 10, 2015; Rucker filed her initial brief a month later. We need not decide

waiver, however, because each TDCA claim fails as a matter of law. 

4 McCaig, 788 F.3d at 478 (citing Wildy v. Wells Fargo Bank, N.A., No. 3:12-cv-01831-

BF, 2012 WL 5987590, at *3 (N.D. Tex. Nov. 30, 2012) (“[F]oreclosure, or the threat of foreclosure, is not an action prohibited by law when a plaintiff has defaulted on their 

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waived its contractual right to foreclose, and Rucker was in default at all times 

after October 2007. Thus, irrespective of any statutory notice requirements, 

BOA did not violate Section 392.301(a)(8) by threatening to foreclose.

Section 392.303(a)(2) prohibits mortgage servicers from using unfair or 

unconscionable means such as “collecting or attempting to collect interest or 

a charge, fee, or expense incidental to the obligation unless [the fee] is 

expressly authorized by the agreement creating the obligation or legally 

chargeable to the consumer.” TEX. FIN. CODE ANN. § 392.303(a)(2). On appeal, 

Rucker claims that BOA assessed excessive fees—totaling roughly $2,000 over 

seven years—but does not contest whether the DOT authorized BOA to assess 

such fees. In fact, in response to the motion for summary judgment, Rucker 

conceded, “Defendants may be authorized, by the Deed of Trust and Note, to 

charge inspection fees or corporate advances as well as miscellaneous fees 

. . . .” Section 392.303(a)(2) prohibits mortgage servicers from attempting to 

assess fees when such fees are not authorized by the DOT; it does not create a 

cause of action to challenge assessed fees as unreasonable. Rucker fails to 

allege a violation of Section 392.303(a)(2), so summary judgment on that claim 

is appropriate.

Section 392.304(a)(8) prohibits mortgage services from making misrepresentations about a debt.5 Rucker must show BOA made a misrepresentation 

 

mortgage.”)).

5 The subsection reads,

 Except as otherwise provided by this section, in debt collection or obtaining information concerning a consumer, a debt collector may not use a fraudulent, deceptive, 

or misleading representation that employs the following practices: (8) misrepresenting the character, extent, or amount of consumer debt, or misrepresenting the consumer debt’s status in a judicial or governmental proceeding.

TEX. FIN. CODE ANN. § 392.304(a)(8).

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that led her to be unaware (1) that she had a mortgage debt, (2) of the specific 

amount she owed, or (3) that she had defaulted. Miller v. BAC Home Loans 

Servicing, L.P., 726 F.3d 717, 723 (5th Cir. 2013). Rucker contends BOA violated that subsection by sending her four letters stating that she owed BOA 

different amounts. When examined more closely, the letters are consistent 

with each other and are not a misrepresentation.

BOA’s January 15, 2010, letter informed Rucker that to bring the loan 

current, she had to pay $86,993.62 by February 14—an amount that represented her unpaid monthly charges since October 2007 plus late fees. BOA’s 

July 12 letter informed Rucker that she owed $244,307.66—the total outstanding principal, interest, charges, and fees. Like the January 15 letter, BOA’s

October 28, 2011, letter notified Rucker that she must pay $146,025.97 to bring 

her loan current. Finally, like the July 12, 2010, letter, BOA’s August 20, 2012,

letter conveyed that Rucker still owed a total of $285,300.85. 

Rucker does not contend that any one letter is a misrepresentation in 

and of itself but rather that the amounts differ, so the letters are misleading

as a whole. But the letters explicitly state that they are describing two different types of obligations: notices of the entire outstanding obligation and notices 

of the amount due to bring the loan current. Each category is internally consistent and consistent with the other. Rucker’s amount to bring the loan current 

continued to grow over time because she was not making adequate payments 

and still occupied the property. The total outstanding obligation grew for the 

same reason. The letters were not misrepresentations but, instead, were 

accurate descriptions of two different types of obligations and were specifically 

identified as such.

Moreover, Rucker fails to establish any of the elements required by Section 392.304(a)(8). See id. Rucker never alleges that BOA made her unaware 

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of her mortgage debt. Rather, she attempted to modify the debt up to when 

she sued; she had to be aware of it to try to modify it. Additionally, as described 

above, she fails to show how BOA’s alleged misrepresentations misled her as 

to the “specific amount” owed. See id. This notion fails, because each letter 

specifically identifies the obligation it described and stated it accurately. 

Finally, Rucker offers no evidence that BOA misrepresented whether her 

loan was in default. Even accepting, as true, her allegation that BOA repeatedly sent her information about loan modifications, there is no evidence that 

BOA equivocated on the status of the loan. Indeed, each of the four letters 

upon which Rucker bases her Section 392.304(a)(8) claim explicitly states that

the loan is in default. Rucker has no valid claim under Section 392.304(a)(8).

AFFIRMED.

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