Court Opinion

ID: 2686314
Source: CourtListenerOpinion
Date Created: 2014-07-30 05:00:37.036097+00
Date Added: 2024-06-11T13:19:06.107143
License: Public Domain

Case: 13-11236      Document: 00512713302         Page: 1    Date Filed: 07/28/2014

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT
                                                                         United States Court of Appeals
                                                                                  Fifth Circuit

                                    No. 13-11236                                FILED
                                  Summary Calendar                          July 28, 2014
                                                                           Lyle W. Cayce
                                                                                Clerk
DANNY ROBINSON; SHIRREE ROBINSON,

                                                 Plaintiffs–Appellants,
v.

WELLS FARGO BANK, N.A., doing business as Wells Fargo Home
Mortgage; FEDERAL HOME LOAN MORTGAGE CORPORATION,

                                                 Defendants–Appellees.

                   Appeal from the United States District Court
                        for the Northern District of Texas
                              USDC No. 4:11-CV-684

Before WIENER, OWEN, and HAYNES, Circuit Judges.
PER CURIAM:*
       Plaintiffs Danny and Shirree Robinson appeal the district court’s grant
of summary judgment on their Texas Debt Collection Act claims and the
district court’s dismissal for failure to state a claim of other state law claims
asserted against Wells Fargo Bank, N.A. (Wells Fargo) and the Federal Home

       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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                                  No. 13-11236
Loan Mortgage Corporation (Freddie Mac) relating to the foreclosure of their
home. We affirm.
                                        I
        Danny and Shirree Robinson obtained a home-equity loan from Wells
Fargo to purchase the property at issue for $278,000. Danny executed a Texas
Home Equity Note (the Note) with Wells Fargo, and both Danny and Shirree
executed a Texas Home Equity Security Instrument (the Deed of Trust). Both
Shirree and Danny additionally signed an escrow waiver providing that they
would pay the taxes and insurance for the property on their own.
        In late 2008, the Robinsons suffered financial strain and could not pay
their full amount of property taxes. They contacted their local taxing authority
and arranged a payment plan. Without their knowledge, Wells Fargo paid the
outstanding tax balance in full and raised the Robinsons’ monthly payment to
compensate for this payment. The Robinsons could not afford to make the
larger payments and they called Wells Fargo to discuss their options. The
Robinsons allege that Wells Fargo recommended that they apply for the Home
Affordable Modification Program (HAMP) but informed them that they would
only be eligible for HAMP if they were in delinquency, so they should miss their
monthly payments.
        After missing their monthly payments the Robinsons received and
submitted a loan-modification application. At the same time, Danny started
receiving phone calls on his cell phone attempting to collect the debt and
seeking to discuss the loan-modification process. The Robinsons allege that
these calls occurred over several months and as frequently as three times a
day.
        In August 2009, Danny received a notice of default and a notice of intent
to accelerate. In October 2009, Danny received a letter from Wells Fargo
stating that the property was set for a foreclosure sale. Danny alleges that he
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                                        No. 13-11236
called Wells Fargo about the letter but Wells Fargo told them to disregard it
because Wells Fargo would not foreclose during the loan-modification review
process.     Subsequently, Wells Fargo advised the Robinsons that they had
qualified for a HAMP trial payment plan but that the offer was only valid
through April 17, 2010. The offered, modified payment plan required even
higher monthly payments than those under the original loan.                        When the
Robinsons called to ask about this, Wells Fargo instructed them to not sign the
loan modification so that it could recalculate the payment without insurance.
The Robinsons allege that Wells Fargo again assured them that it would not
foreclose during the loan-modification process.               Nevertheless, Wells Fargo
foreclosed on the property and sold it to Freddie Mac on April 6, 2010.
      The Robinsons filed this suit against Wells Fargo and Freddie Mac in
Texas state court, and the Defendants removed the case to federal court. The
Robinsons alleged claims against Wells Fargo for violations of the Texas Debt
Collection Act; unreasonable collection efforts; and breach of contract, among
others. The district court granted a motion to dismiss for failure to state a
claim on all claims save for alleged violations of the Texas Debt Collection Act.
The district court later granted summary judgment on the Texas Debt
Collection Act claims. The Robinsons appeal.
                                               II
      The Robinsons first allege that the district court erred in granting
summary judgment on their two Texas Debt Collection Act claims brought
under §§ 392.301(a)(8) and 392.302(4) of the Texas Finance Code. “We review
de novo a district court’s award of summary judgment, applying the same
standard as the district court.” 1 Summary judgment is only appropriate “if the

      1   Trinity Universal Ins. Co. v. Empr’s Mut. Cas. Co., 592 F.3d 687, 690 (5th Cir. 2010).
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                                       No. 13-11236
movant shows that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.” 2
                                              A
      Texas Finance Code § 392.301(a)(8) provides that “a debt collector may
not use threats, coercion, or attempts to coerce that employ [the practice of]
threatening to take an action prohibited by law.” 3 The Robinsons allege that
Wells Fargo violated this provision because it only sent Danny Robinson, and
not Shirree Robinson, a notice of default and intent to accelerate.                 The
Robinsons allege that Wells Fargo, in failing to separately notify Shirree, took
an action in violation of the Texas Property Code that requires that “the
mortgage servicer of the debt . . . serve a debtor in default under a deed of trust
. . . with written notice by certified mail” that the debtor is in default. 4 This is
incorrect.
      The duty imposed under the Texas Property Code refers to “a debtor in
default.” 5 Shirree was not a debtor in this instance. Shirree did not sign the
Note. In the Note, Danny promised to pay $278,000, plus interest, to the order
of the Lender. He further promised that if he did not pay the “full amount of
each monthly payment” on the date it was due that he would be in default.
Shirree did not sign the Note but only signed the Deed of Trust. This Deed of
Trust expressly recognized that Shirree was not a debtor. Its terms dictate
that, “any person who signs this Security Instrument [the Deed of Trust] but
does not execute the Note . . . is not obligated to pay the sums secured by this
Security Instrument and is not to be considered a guarantor or surety.”

      2   FED. R. CIV. P. 56(a).
      3   TEX. FIN. CODE ANN. § 392.301(a)(8) (2006).
      4   TEX. PROP. CODE ANN. § 51.002(d) (2007).
      5   Id. (emphasis added).
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      Finally, the Security Instrument provides that, “[n]otice to any one
Borrower shall constitute notice to all Borrowers unless Applicable Law
expressly requires otherwise.” The Robinsons claims that applicable Texas law
expressly requires otherwise. But even if Shirree were a debtor under the
terms of the Note and Deed of Trust, Texas law only requires the provision of
constructive notice of an intent to foreclose and accelerate after a default. “The
general purpose of [§ 51.002] is to provide a minimum level of protection for
the debtor, and it provides only for constructive notice of the foreclosure.” 6 In
this case, Shirree received constructive notice. Her husband admitted that he
received the written notice of default and intent to accelerate, and the notice
had been sent to their shared address. Thus even if Shirree were considered a
debtor the notice provided was sufficient to meet Wells Fargo’s obligations
under Texas law.
                                             B
      The Robinsons also allege that the district court erred in granting
summary judgment on their claims that Wells Fargo violated Texas Finance
Code § 392.302(4). That provision prohibits a debt collector from harassing or
abusing a person by “causing a telephone to ring repeatedly or continuously,
or making repeated or continuous telephone calls, with the intent to harass a
person at the called number.” 7 The district court denied this claim because it
stated that the Robinsons had failed to demonstrate that all of the alleged
phone calls were made for the purposes of debt collection or that Wells Fargo
possessed “an intent to harass.”

      6  WTFO, Inc. v. Braithwaite, 899 S.W.2d 709, 720 (Tex. App.—Dallas 1995, no writ)
(citing Onwuteaka v. Cohen, 846 S.W.2d 889, 892 (Tex. App.—Houston [1st Dist.] 1993, writ
denied)).
      7   TEX. FIN. CODE ANN. § 392.302(4) (2006).
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       There are few cases that articulate the standard that courts should
employ to determine whether a debt collection practice has risen to the level of
harassment. In Household Credit Services v. Driscol, 8 a Texas appellate court
held that the “[r]eceipt of multiple calls in any one day, often prior to normal
waking or after normal retiring hours and often at work even after requests to
stop, with a hostile, profane individual on the other end of the line [was]
sufficient [to meet the elements of the cause of action].” 9 While there is little
Fifth Circuit precedent on this issue, other courts generally require both a
great volume of phone calls and extenuating circumstances, such as making
those calls at odd hours 10 or threatening personal violence. 11
       In this case there is no evidence that Wells Fargo phoned outside of
regular business hours or that Wells Fargo’s debt collection efforts included
any threats of violence against the Robinsons. Danny Robinson testified that
he received “several calls a day.” The Robinsons rely on Young v. Asset
Acceptance LLC 12 for the proposition that call volume is sufficient to raise a
genuine issue of material fact. But in Young, the debtor was also called at
more inconvenient times, both before 8:00 a.m. and after 9:00 p.m. 13 The
Robinsons have presented no comparable evidence. Rather, they respond that

       8   989 S.W.2d 72 (Tex. App.—El Paso 1998, pet. denied).
       9   Household Credit Servs., 989 S.W.2d at 85.
       10See Enis v. Bank of Am., 3:12-CV-0295-D, 2013 WL 1721961, at *6 (N.D. Tex. Apr.
22, 2013) (noting that although it was a close call, plaintiff’s evidence that Bank of America
called him multiple times a day for a total of 110 calls in 21 months and called as late as
11:00 p.m. was sufficient to defeat summary judgment on this issue).
       11 See Pioneer Fin. & Thrift Corp. v. Adams, 426 S.W.2d 317, 319, 321 (Tex. Civ. App.—
Eastland 1968, writ ref’d n.r.e.) (holding that plaintiff’s evidence that collection agency called
plaintiff five times in one night and threatened personal violence was sufficient to support a
jury finding that such collection efforts were unreasonable).
       12   No. 3:09-CV-2477-BH, 2011 WL 1766058 (N.D. Tex. May 10, 2011).
       13   Young, 2011 WL 1766058, at *3.
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                                        No. 13-11236
many of the phone calls occurred while Danny was at work. But these phone
calls were made to his cell phone, not to his office, and this was the phone
number Danny listed as his contact number with Wells Fargo. In sum, we
agree with the district court that the evidence does not give rise to a genuine
issue of material fact as to whether Wells Fargo’s debt collection practices were
unreasonable.
                                              III
      The Robinsons also allege that the district court erred in dismissing a
variety of other state law claims. We review de novo the district court’s grant
of a Rule 12(b)(6) motion to dismiss for failure to state a claim and we construe
the facts in the light most favorable to the nonmoving party. 14 “Dismissal is
appropriate only if the complaint fails to plead ‘enough facts to state a claim to
relief that is plausible on its face.’” 15
                                               A
      The Robinsons allege that the district court erred in dismissing their
claims that Wells Fargo violated § 392.304(a)(8) and § 392.304(a)(19) of the
Texas Finance Code. Section 392.304(a) of the Texas Finance Code prohibits
the use of “fraudulent, deceptive, or misleading representation” by a debt
collector including, “(8) misrepresenting the character, extent, or amount of a
consumer debt,” and “(19) using any other false representation or deceptive
means to collect a debt or obtain information concerning a consumer.” 16 The
Robinsons allege that Wells Fargo violated one or both of these provisions
because Wells Forgo “misled [the Robinsons] into believing that they would not
foreclose during the loan modification process and that [the Robinsons] had to

      14   Leal v. McHugh, 731 F.3d 405, 410 (5th Cir. 2013).
      15   Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
      16   TEX. FIN. CODE ANN. § 392.304(a)(8) (2006).
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                                      No. 13-11236
be delinquent in order to qualify for a loan modification.” These arguments
fail.
         First, neither of the allegedly misrepresentative statements concern the
“character, extent, or amount of a consumer debt.” Thus the only question is
whether either of them fall afoul of the catch-all provision of § 392.304(a)(19).
They do not.       “To violate the TDCA using a misrepresentation, the debt
collector must have made an affirmative statement that was false or
misleading.” 17    Under Texas misrepresentation law, “[a] promise to do or
refrain from doing an act in the future is not actionable” 18 unless “the promise
was made with no intention of performing at the time it was made.” 19 Neither
of the allegedly misleading statements meet this standard. The Robinsons
have not alleged that Wells Fargo’s promise to delay foreclosing until April 17,
2010 was made without any intention of performing it. Nor have the Robinsons
alleged that Wells Fargo’s statement that the Robinsons needed to be
delinquent in order to qualify for the HAMP loan modification program was
false or that they would have been eligible for HAMP absent default. 20 Thus
the district court did not err in dismissing these claims for failure to state a
claim.

          Verdin v. Fed. Nat’l Mortg. Ass’n, 540 F. App’x 253, 257 (5th Cir. 2013) (internal
         17

quotation marks omitted) (citing Kruse v. Bank of N.Y. Mellon, 936 F. Supp. 2d 790, 792 (N.D.
Tex. 2013); see also Williams v. Wells Fargo Bank, N.A., 560 F. App’x 233, 2014 WL 1044304,
at *6 (5th Cir. 2014).
        BCY Water Supply Corp. v. Residential Inv., Inc., 170 S.W.3d 596, 603 (Tex. App.—
         18
Tyl. 2005, pet. denied) (citing Miksch v. Exxon Corp., 979 S.W.2d 700, 706 (Tex. App.—
Houston [14th Dist.] 1998, pet. denied)).
          Formosa Plastics Corp. USA v. Presidio Eng’rs & Contractors, Inc., 960 S.W.2d 41,
         19

48 (Tex. 1998).
         See also Thomas v. EMC Mortg. Corp., 499 F. App’x 337, 343 (5th Cir. 2012) (noting
         20

with approval that a district court had recently stated that “discussions regarding loan
modification or a trial payment plan are not representations, or misrepresentations, of the
amount or character of a debt”).
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                                        No. 13-11236
                                               B
      The Robinsons next allege that the district court erred in dismissing
their claim that Wells Fargo waived its right to enforce the terms of the Deed
of Trust. It is undisputed that the Robinsons missed payments due under the
Note. The Robinsons nevertheless contend that Wells Fargo was without
power to foreclose on the property because their actions were inconsistent and
because they delayed in foreclosing while discussing loan modification terms
with the Robinsons. “The elements of waiver include (1) an existing right,
benefit, or advantage held by a party; (2) the party’s actual knowledge of its
existence; and (3) the party’s actual intent to relinquish the right, or
intentional conduct inconsistent with the right.” 21 The intent to relinquish or
waive a right must be “unequivocally manifested.” 22
      Wells Fargo’s decision to delay foreclosing on the property and to engage
in discussions regarding the modification of the Robinsons’ loan agreement do
not manifest an express intent by Wells Fargo to waive its right to foreclose. 23
Further, the Deed of Trust expressly provides that “[e]xtension of the time for
payment or modification . . . of the sums secured by [the Deed of Trust] . . .
shall not operate to release liability of Borrower,” and “[a]ny forbearance by
Lender in exercising any right or remedy . . . shall not be a waiver of or preclude
the exercise of any right or remedy.” The district court did not err in dismissing
this claim.
                                               C
      Finally, the Robinsons allege that the district court erred in dismissing
their suit to quiet title. “In a suit to [quiet title], the plaintiff has the burden

      21   Ulico Cas. Co. v. Allied Pilots Ass’n, 262 S.W.3d 773, 776 (Tex. 2008).
      22   Williams, 2014 WL 1044304, at *5; see also Thomas, 499 F. App’x at 341.
      23   See Williams, 2014 WL 1044304, at *5.
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of supplying the proof necessary to establish his superior equity and right to
relief.” 24 The Robinsons contend that their title is superior because Wells
Fargo and Freddie Mac “fail[ed] to comply with the Texas Property Code
§ 51.002 and the Deed of Trust.” Because we have already concluded that Wells
Fargo did have a right to foreclose and did not violate the above provisions, the
Robinsons cannot prove the superiority of their title. The district court did not
err in dismissing this claim either.
                                      *     *     *
       AFFIRMED.

       24   Hahn v. Love, 321 S.W.3d 517, 531 (Tex. App.—Houston [1st Dist.] 2009, pet.
denied).
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