NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

In re: CHARLES L. DUFF, 

Debtor, 

------------------------------

CHARLES L. DUFF; CATHRYN DUFF, 

Appellants, 

 v. 

NEWREZ, LLC, DBA Shellpoint Mortgage 

Servicing; BANK OF NEW YORK 

MELLON; COUNTRYWIDE FINANCIAL 

CORPORATION; COUNTRYWIDE HOME 

LOANS, INC.; COUNTRYWIDE BANK, 

N.A.; LANDSAFE, INC.; LANDSAFE 

APPRAISAL, INC.; BANK OF AMERICA 

CORPORATION; BAYVIEW LOAN 

SERVICING, LLC,, 

Appellees.

No. 21-60022 

BAP No. 20-1092 

MEMORANDUM*

In re: CHARLES L. DUFF, 

Debtor, 

------------------------------

No. 21-60023 

BAP No. 20-1095 

* This disposition is not appropriate for publication and is not precedent 

except as provided by Ninth Circuit Rule 36-3.

FILED

MAR 31 2022

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS
2 

CHARLES L. DUFF; CATHRYN DUFF, 

Appellants, 

 v. 

NEWREZ, LLC, DBA Shellpoint Mortgage 

Servicing; BANK OF NEW YORK 

MELLON; COUNTRYWIDE FINANCIAL 

CORPORATION; COUNTRYWIDE HOME 

LOANS, INC.; COUNTRYWIDE BANK, 

N.A.; LANDSAFE, INC.; LANDSAFE 

APPRAISAL, INC.; BANK OF AMERICA 

CORPORATION; BAYVIEW LOAN 

SERVICING, LLC, 

Appellees.

Appeal from the Ninth Circuit

Bankruptcy Appellate Panel

Lafferty III, Gan, and Faris, Bankruptcy Judges, Presiding

Argued and Submitted March 7, 2022

Pasadena, California

Before: BERZON and FRIEDLAND, Circuit Judges, and KORMAN,** District 

Judge.

Chapter 11 debtor Charles Duff and his non-debtor spouse Cathryn Duff 

appeal the Bankruptcy Appellate Panel’s (“BAP”) decision affirming the bankruptcy 

** The Honorable Edward R. Korman, United States District Judge for 

the Eastern District of New York, sitting by designation.
3 

court’s Fed. R. Civ. P. 12(b)(6) dismissal of their adversary proceeding against 

NewRez LLC (dba Shellpoint Mortgage Servicing) et al.

1. Five out of eight of the Duffs’ claims—their claim under California’s 

Unfair Competition Law (Cal. Bus. & Prof. Code § 17200 et seq.), two claims under 

the Racketeer Influenced and Corrupt Organizations Act (18 U.S.C. §§ 1962(c), (d)), 

and their state law claims of unjust enrichment and fraud—are based on the Duffs’

theory that they would not have qualified for or accepted the loan if not for their 

lender’s fraudulent second appraisal. Like the BAP, we find the Duffs’ fraud 

argument to be “implausible on its face.” The Duffs knew the terms of their loan 

and accepted them of their own accord. A “Fixed/Adjustable Rate Rider” confirms 

that the “initial fixed interest rate” would “change[] to an adjustable interest rate.” 

Even if we accept as true the allegations that Countrywide and LandSafe engaged in 

a fraudulent appraisal scheme and fabricated the second appraisal, it does not follow 

that the fraudulent second appraisal caused the Duffs to obtain a loan they could not 

afford. Indeed, logically, a higher appraisal would have helped the Duffs obtain 

more favorable loan terms.

Moreover, California law underscores the legal insufficiency of the Duffs’ 

fraud allegations. California law provides that “a lender of money owes no duty of 

care to a borrower in preparing an appraisal of the security for a loan when the 

purpose of the appraisal simply is to protect the lender by satisfying it that the 
4 

collateral provides adequate security for the loan.” Nymark v. Heart Fed. Sav. & 

Loan Ass’n, 283 Cal. Rptr. 53, 54 (Ct. App. 1991). The California Court of Appeal

has also rejected the argument that borrowers are entitled to rely upon a lender’s 

“determination that they qualified for the loans in order to decide if they could afford

the loans.” Perlas v. GMAC Mortg., LLC, 113 Cal. Rptr. 3d 790, 796 (Ct. App. 

2010).

2. Three causes of action are based on somewhat different allegations—

the state law claims of promissory estoppel and breach of the covenant of good faith 

and fair dealing and the claim under the Fair Debt Collection Practices Act (15 

U.S.C. §§ 1692–1692p) (“FDCPA”). The first two claims are premised on the 

Duffs’ allegations that Bank of America (the lender’s successor in interest) “induced 

[them] to default on the two loans by stating that it would only consider a mortgage 

modification if they fell behind on payments.” The Duffs’ promissory estoppel

claim fails because there was no “clear and unambiguous” promise to modify the 

loan—Bank of America merely told the Duffs it would consider a modification. 

Laks v. Coast Fed. Sav. & Loan Ass’n, 131 Cal. Rptr. 836, 839 (Ct. App. 1976). The 

breach of the implied covenant of good faith and fair dealing claim fails because 

there was no “specific contractual obligation” regarding loan modification 

underlying that claim. Racine & Laramie, Ltd. v. Dep’t of Parks & Recreation, 14 

Cal. Rptr. 2d 335, 338 (Ct. App. 1992). The FDCPA claim fails because non-judicial 
5 

foreclosure proceedings do not constitute “debt collection” under the FDCPA. The 

deed of trust explicitly states that the lender has the right to foreclose. See Barnes 

v. Routh Crabtree Olsen PC, 963 F.3d 993, 998 (9th Cir. 2020) (“[T]he remedy of 

foreclosure authorizes a creditor ‘to retake and resell the security, not to collect 

money from the borrower.’” (quoting Ho v. ReconTrust Co., NA, 858 F.3d 568, 571 

(9th Cir. 2017))).

Finally, the bankruptcy court did not err in denying leave to amend, which the 

Duffs did not request, because the “pleadings before the court demonstrate[d] that 

further amendment would be futile.” Rutman Wine Co. v. E. & J. Gallo Winery, 829 

F.2d 729, 738 (9th Cir. 1987). Even on appeal, the Duffs have not identified how 

they would cure the deficiencies in their complaint. Their failure to do so 

demonstrates “their inability (or, perhaps, unwillingness) to make the necessary 

amendment” and suggests that any amendment would be futile. Carrico v. City & 

Cnty. of San Francisco, 656 F.3d 1002, 1008 (9th Cir. 2011).

AFFIRMED.