Opinion ID: 2277130
Heading Depth: 2
Heading Rank: 1

Heading: Credit Expectancy

Text: An expectancy is that which is expected or hoped for. [19] To have valid credit expectancy one need not have a formal contract. [20] There must be, however, a reasonable expectation of obtaining credit. [21] This expectancy cannot be too indefinite or remote. [22] The dispute in this case centers on whether Bell could have had valid credit expectancy at the time derogatory information was reported without having had a credit application pending with any creditor. Famous Barr argues the analysis of the court in Haas [23] and the facts of Franklin [24] suggest a pending credit application is necessary for credit expectancy as a matter of law. We disagree and hold no pending credit application is necessary for credit expectancy. Bell presented undisputed evidence that he had a perfect credit history until Famous Barr reported derogatory information. He made $15,000.00 in credit card purchases per year on average, had financing for his home, and no creditor had ever reported him delinquent. He also had a credit account with Famous Barr for twenty-two years, which he paid in full every month. In addition, Bell never was denied credit until denied by EAB. Finally, Bell showed he repeatedly asked Famous Barr to remove derogatory information from his credit report. Although Bell had no credit application pending at the time Famous Barr reported derogatory information, a reasonable jury could find he had valid credit expectancy based on his longstanding clean credit history, and his efforts to keep it clean. This holding is consistent with the rule that no formal contract is required for valid credit expectancy. [25] We stress that only a valid or reasonable expectancy of credit satisfies the test. Not only must plaintiff expect to apply for credit, but also plaintiff must have a reasonable chance of obtaining credit. What constitutes a reasonable chance of obtaining credit is usually a question of fact for the jury to decide where fair-minded persons could disagree. In this case, a reasonable jury could find Bell's chance of obtaining credit was reasonable by his credit report being devoid of any delinquency. We hold a reasonable jury could find Bell had valid credit expectancy. Famous Barr argues we should follow Haas v. Town and Country Mortgage Company [26] to conclude Bell had no valid expectancy of credit because he had no credit application pending with EAB when Famous Barr reported derogatory information. In Haas , plaintiffs sought to buy a piece of property that was being foreclosed and assumed the mortgage from the owner. Plaintiffs were negligent by not inquiring about the eligibility requirements of the mortgage loan they assumed, and one week after closing defendant mortgagee informed them they were ineligible because the loan was reserved for first time buyers. Defendant gave plaintiffs certain options, none of which plaintiffs exercised. Despite being advised by their own title company to make loan payments until the problem was resolved, plaintiffs missed payments. Consequently, defendant reported that plaintiffs were delinquent. Plaintiffs thereafter were denied credit and charged higher-than-normal interest rates on a car loan. The court of appeals reversed the judgment the trial court entered in favor of plaintiffs' claim for tortious interference with a business expectancy. It found no evidence in the record that at the time [defendant] issued the credit reports that plaintiffs had established a business relationship either with any of the credit card companies which denied them credit or with the lender of the car loan. [27] Despite similarities between Haas and the instant case, Haas does not control because of important factual differences. Unlike the instant case, in Haas there was no evidence defendant wrongfully reported derogatory information to credit card companies. Plaintiffs neglected to learn the eligibility requirements of their loan and they were advised to continue repaying the loan. It is reasonable to conclude the court rejected plaintiffs' claim of intentional interference with a business expectancy claim because defendant was justified in reporting the derogatory informationthe fourth element of this tort claim. Also unlike the instant case, in Haas there was no evidence of the strength of plaintiffs' credit history. It found plaintiff's mere hope of establishing a credit relationship tenuous and not evinc[ing] the existence of a valid business relationship or expectancy. The court may have found that while plaintiffs had credit expectancy, they lacked a valid or reasonable expectancy. This language also suggests the court rejected plaintiff's claim because insufficient evidence showed defendant's actions caused plaintiffs' creditors to deny them creditthe third element of this tort claim. Notwithstanding these factual differences, the court in Haas may have under-appreciated the claim of tortious interference with credit expectancy. It ruled against plaintiffs because they had no established business relationship with a creditor. It considered the mere hope of establishing a credit relationship tenuous and not evinc[ing] the existence of a valid business relationship or expectancy. The court incorrectly focused exclusively on an established business relationship. As explained above, a formal credit contract is not necessary for valid credit expectancy. [28] Expectancy is just that: hope. If that hope is reasonable, then plaintiff has valid credit expectancy. In neither its factual background nor its analysis did the court in Haas cite any evidence of plaintiffs' credit history. Nor did it consider the reasonableness or validity of plaintiff's hope of obtaining credit. To the extent Haas and Franklin require a pending credit application in order to find valid credit expectancy, they are overruled.