Court Opinion

ID: 4090285
Source: CourtListenerOpinion
Date Created: 2016-10-18 16:01:13.636064+00
Date Added: 2024-06-11T14:09:37.410332
License: Public Domain

FILED
                                                                    United States Court of Appeals
                      UNITED STATES COURT OF APPEALS                        Tenth Circuit

                             FOR THE TENTH CIRCUIT                       October 18, 2016
                         _________________________________
                                                                        Elisabeth A. Shumaker
                                                                            Clerk of Court
CHRISTINE WARREN,

      Plaintiff - Appellant,

v.                                                        No. 16-1021
                                              (D.C. No. 1:14-CV-02241-PAB-CBS)
GREEN TREE SERVICING, LLC,                                 (D. Colo.)

      Defendant - Appellee.
                      _________________________________

                             ORDER AND JUDGMENT*
                         _________________________________

Before MATHESON, O’BRIEN, and PHILLIPS, Circuit Judges.
                  _________________________________

      Christine Warren appeals from two district court orders. In one, the court set

aside a clerk’s entry of default and denied as moot Ms. Warren’s motion for a default

judgment against Green Tree Servicing, LLC. In the other, the court granted

summary judgment to Green Tree on Ms. Warren’s claim under the Real Estate

Settlement Procedures Act (“RESPA”), 12 U.S.C. §§ 2601-17. Exercising

jurisdiction pursuant to 28 U.S.C. § 1291, we affirm.

      *
        After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist in the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
                                       I. RESPA

       Under RESPA, the servicer of a “federally related mortgage loan” may be

liable for damages if it does not adequately respond to a borrower’s qualified written

request (QWR). 12 U.S.C. § 2605(e)-(f). A QWR is “a written correspondence” that

includes either “a statement of the reasons for the belief of the borrower . . . that the

account is in error or provides sufficient detail to the servicer regarding other

information sought by the borrower.” Id. § 2605(e)(1)(B). When a servicer receives

a QWR, it has five days to send written acknowledgment of receipt. Id.

§ 2605(e)(1)(A); 12 C.F.R. §§ 1024.35(d), 1024.36(c). It also has 30 days to

investigate and either make appropriate corrections, provide the requested

information, or explain in writing why the servicer believes the account is correct or

the information is not available to it. Id. § 2605(e)(2); 12 C.F.R. §§ 1024.35(e)(1),

(3)(i)(C), 1024.36(d).

       Under RESPA’s implementing regulation, Regulation X, a servicer may

establish a specific address for receiving QWRs (“QWR address”) by sending written

notice to the borrower stating that the borrower must use the established address.

12 C.F.R. §§ 1024.35(a), (c), 1024.36(a), (b). “[R]eceipt at the designated address is

necessary to trigger RESPA duties.” Berneike v. CitiMortgage, Inc., 708 F.3d 1141,

1149 (10th Cir. 2013). “Communication failing to meet the requirements of RESPA

and its implementing regulation amounts to nothing more than general

correspondence between a borrower and servicer.” Id.

                                           -2-
                           II. FACTUAL BACKGROUND

       Bank of America initially serviced Ms. Warren’s mortgage loan. In a

three-page “welcome letter” dated March 21, 2013, Green Tree informed her that

effective April 1, 2013, it would be the new servicer. Page two contained a

“NOTICE ABOUT YOUR RIGHTS” under RESPA, Aplt. App., Vol. 1 at 178,

stating:

       Section 6 of RESPA (12 U.S.C. § 2605) gives you certain consumer
       rights. . . . A “qualified written request” is a written correspondence, other
       than notice on a payment coupon or other payment medium supplied by the
       servicer, which includes your name and account number, and your reasons
       for the request. If you want to send a “qualified written request” regarding
       the servicing of your loan to your new servicer, it must be sent to this
       address: Green Tree, PO Box 6176, Rapid City, SD 57709-6176.
Id. (emphasis added). We shall refer to the designated QWR address as “Box 6176.”

On page three, Green Tree informed Ms. Warren that “[a]ny questions, complaints or

inquiries you have regarding your loan may always be directed in writing to our

Customer Service Department at . . . PO Box 6172[,] Rapid City, SD 57709-6172.”

Id. at 179 (emphasis added). We shall refer to this address as “Box 6172.”

       Ms. Warren wrote a letter to Bank of America and Green Tree, also dated

March 21, 2013, and addressed to Green Tree in St. Paul, Minnesota (“First Letter”).

After expressing her understanding that Green Tree was taking over the servicing as

of April 1, Ms. Warren asked for written confirmation that her mortgage payments

were paid through February 2014. About a month later, Green Tree sent a letter

acknowledging receipt of the First Letter, stating that her inquiry was under review,

and informing her that if she had “any questions or comments,” she could contact

                                           -3-
customer service at Box 6172. Id. at 181. The letter also provided customer-service

telephone and fax numbers.

      On May 9, 2013, Green Tree responded substantively to Ms. Warren’s request.

The only address on the response was Box 6172, which was printed on the letterhead

as Green Tree’s return address along with telephone and fax numbers. Green Tree

told Ms. Warren to call if she had “any questions.” Id., Vol. II at 198.

      Over the next year, Ms. Warren sent four more letters (the last authored by her

attorney) to Box 6172 alleging continued errors in her account. Each time, Green

Tree responded with an acknowledgment letter substantially identical to the first and

informing Ms. Warren that she could contact customer service at the address in its

letterhead—Box 6172—if she had “any questions or comments.” Id. at 216, 228,

229, 253. Green Tree also provided a substantive response to Ms. Warren’s second,

third, and fourth letters. Each one, like the first substantive response, set forth only

the Box 6172 address in the letterhead and told her she could call the listed number if

she had “any further questions or concerns.” Id. at 219, 232, 245.

      In addition to this correspondence, Green Tree sent Ms. Warren Monthly

Informational Statements. Twelve of them, covering the period from May 9, 2013

through August 9, 2014, appear in her appellate appendix. These statements

contained different mailing addresses for different types of correspondence a

borrower might send. On the front, the statements listed Box 6172 as the

“correspondence address” to which Ms. Warren could send “inquiries.” E.g., id.,

Vol. I at 182. The Box 6172 address was also listed on the back under the heading

                                           -4-
“Correspondence/Complaints.” E.g., id. at 183. And immediately below that

address, the first six statements provided: “For First Lien Mortgage Loan

Customers Only: Pursuant to § 6 of RESPA, a ‘Qualified Written Request’

regarding the servicing of your loan must be sent to [Box 6176].” E.g., id. Similarly,

the last six statements provided, also immediately below the

“Correspondence/Complaints” address on the back: “Designated Address for

Qualified Written Requests, Notices or [sic] Error and Requests for

Information: Green Tree has designated the following address where mortgage loan

customers must send any Qualified Written Request, Notice of Error or Request for

Information: PO Box 6176 . . . .” E.g., id., Vol. II at 231.

                          III. PROCEDURAL HISTORY

      Ms. Warren sued Bank of America and Green Tree, asserting five claims. She

obtained a clerk’s entry of default against both defendants. After Ms. Warren moved

for a default judgment, Green Tree moved to set aside the entry of default. While

those motions were pending, Ms. Warren settled with Bank of America and stipulated

to the dismissal with prejudice of all claims except her RESPA claim against Green

Tree. The district court concluded that the proper method for dismissing all but the

RESPA claim was for Ms. Warren to file an amended complaint, so the court

converted the dismissal stipulation into a motion for leave to amend under Federal

Rule of Civil Procedure 15.

      Ms. Warren amended her complaint to allege one claim—that Green Tree had

not complied with its RESPA obligation to provide adequate responses within

                                          -5-
30 days to each of her five letters, all of which she characterized as QWRs. The

district court concluded that the clerk’s entry of default was directed at a superseded

pleading (the original complaint) and therefore directed the clerk to set aside the

entry of default. The court also denied as moot Ms. Warren’s motion for default

judgment and Green Tree’s motion to set aside the entry of default. Green Tree then

moved for summary judgment. The district court granted that motion based on its

conclusion that there was no genuine dispute of material fact that Green Tree had

properly established Box 6176 as the exclusive address for receiving QWRs and that

Ms. Warren had not sent any QWRs to that address. Ms. Warren appeals.

                                  IV. DISCUSSION

      Ms. Warren’s primary argument is that the district court erred in granting the

motion for summary judgment. In the alternative, she contends the court should not

have set aside the clerk’s entry of default.

     A. The district court properly granted summary judgment to Green Tree.

      “We review the district court’s grant of summary judgment de novo, applying

the same standards that the district court should have applied.” Fields v. City of

Tulsa, 753 F.3d 1000, 1008 (10th Cir. 2014) (internal quotation marks omitted). A

“court shall grant summary judgment if the 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.” Fed. R. Civ. P. 56(a). “[W]e examine the record and all reasonable inferences

that might be drawn from it in the light most favorable to the nonmoving party.”

Fields, 753 F.3d at 1009 (internal quotation marks omitted).

                                           -6-
      Ms. Warren argues that Green Tree established Box 6172 as a QWR address.

She claims that Green Tree’s five acknowledgment letters listed only Box 6172 as the

address to which she could send “requests for information or notices of error about

her loan servicing.” Aplt. Opening Br. at 12. She also contends that she sent the

First Letter before Green Tree sent her any notice designating a specific address for

receipt of QWRs. She points to the statement in the welcome letter indicating that

she could “always . . . direct[]” “[a]ny questions, complaints or inquiries” to Box

6172. Aplt. App., Vol. I at 179. And she directs our attention to the front of the

Monthly Informational Statements, where she was told she could send “inquiries” to

Box 6172. E.g., id., Vol. I at 182. She also maintains that Green Tree’s notices

about where she was required to send QWRs were not “clear and conspicuous,” as

required under 12 C.F.R. § 1024.32(a)(1), and that Green Tree’s substantive

responses to four of her letters provide further evidence of Green Tree’s intent to

establish Box 6172 as its QWR address.1 We address Ms. Warren’s arguments as

follows.

      First, as to when she received notice of the QWR address, the welcome letter

was dated March 21, 2013, the same date listed on her First Letter to Green Tree, and

Ms. Warren testified that she received it “on or about” that date. See Aplt. App.

at 151-52. Even if we credit her allegation that she sent the First Letter before

      1
         Ms. Warren makes this argument on page 16 of her opening appellate brief
but appears to disclaim it in her reply brief, stating that her focus is not on Green
Tree’s responses to her letters but on “its actions in directing her where to send her
correspondence,” Reply Br. at 6. We will nonetheless consider this argument.

                                          -7-
receiving any notice from Green Tree establishing a QWR address, Green Tree was

not yet the servicer, and RESPA’s response obligations are triggered when the

“servicer of a federally related mortgage loan receives a [QWR].” 12 U.S.C.

§ 2605(e)(1) (emphasis added). Ms. Warren has not suggested that Green Tree

received the First Letter after it took over as the servicer, nor has she offered any

relevant authority for her implied argument that a successor servicer has an

obligation under RESPA to respond to a QWR sent before it actually takes over

servicing.2

      Second, the welcome letter clearly and conspicuously established a QWR

address. According to the Official Bureau Interpretations of Regulation X, the notice

of an exclusive QWR address “is subject to the clear and conspicuous requirement”

      2
         Ms. Warren relies on Catalan v. GMAC Mortgage Corp., 629 F.3d 676
(7th Cir. 2011), but Catalan offers no obvious support for her point. In Catalan, a
borrower sent a letter to the United States Department of Housing and Urban
Development (“HUD”) detailing alleged errors in the servicing of a mortgage loan.
Id. at 682. HUD forwarded the letter to the loan servicer. Id. The Seventh Circuit
reasoned that the servicer was obligated to treat the letter as a QWR because HUD
was acting on behalf of the borrower when it forwarded the letter. Id. at 688. The
court pointed to RESPA’s requirement that QWRs must be “received ‘from the
borrower (or an agent of the borrower).’” Id. (quoting 12 U.S.C. § 2605(e)(1)(A)).
Here, Ms. Warren sent a copy of the First Letter directly to Green Tree (although not
to Box 6176), so we fail to see how Catalan applies. Moreover, even assuming Bank
of America had some obligation to treat the letter as a QWR and forward it to Green
Tree in anticipation of the servicing transfer, Bank of America was not acting as
Ms. Warren’s agent.

                                          -8-
of 12 C.F.R. § 1024.32(a)(1).3 12 C.F.R. Pt. 1024, Supp. I, Subpart C, §§ 1024.35(c),

1024.36(b). Even accepting Ms. Warren’s view that the inquiry must be made from

the perspective of an ordinary consumer,4 we see no genuine issue of fact concerning

whether the notice in the welcome letter was clear and conspicuous. When read in

isolation, the statement in the welcome letter indicating that Ms. Warren could

“always . . . direct[]” “[a]ny questions, complaints or inquiries” to Box 6172, Aplt.

App., Vol. I at 179, might suggest that Green Tree agreed to receive QWRs at Box

6172. But the welcome letter also contained the express designation of Box 6176 as

the address to which Ms. Warren must send any QWRs. This designation appeared

on its own page inside a box titled “NOTICE ABOUT YOUR RIGHTS,” and it

specifically referenced RESPA and defined a QWR. Id. at 178. When read in the

context of the entire welcome letter, the statement that Ms. Warren could always

direct any inquiries to Box 6172 did not establish Box 6172 as an address for receipt

of QWRs.

      Third, the acknowledgment letters did not inform Ms. Warren or even imply

that, as she puts it, she could send “requests for information or notices of error” to

      3
         The regulation provides: “Except as otherwise provided in this subpart,
disclosures required under this subpart must be clear and conspicuous, in writing, and
in a form that a recipient may keep.” 12 C.F.R. § 1024.32(a)(1).
      4
         Ms. Warren did not make this “ordinary consumer” argument in the district
court. Although we do not decide that RESPA’s “clear and conspicuous”
requirement must be viewed from this perspective, her arguments fail to convince us
that an ordinary consumer would be confused as to whether Green Tree designated
Box 6176 as its only QWR address.

                                          -9-
Box 6172. Aplt. Opening Br. at 12. Instead, they told her she could send “questions

or comments” to Box 6172. See, e.g., Aplt. App., Vol. I at 181. To establish a QWR

address, a loan servicer must tell the borrower that she must send “notices of error”

or “requests [for] information” to the designated address. 12 C.F.R. §§ 1024.35(c),

1024.36(b). The acknowledgment letters only referred to “questions or comments.”

We therefore conclude the acknowledgment letters indisputably did not establish Box

6172 as a QWR address

      In Steele v. Green Tree Servicing, LLC, No. 3:09-CV-0603-D, 2010 WL
3565415 (N.D. Tex. Sept. 7, 2010) (unpublished), the Northern District of Texas

reached a similar conclusion in a case involving materially identical language

contained in a welcome letter and later correspondence indicating the borrowers

could contact Green Tree at a different address. In granting summary judgment to

Green Tree on the borrowers’ RESPA claim, the court concluded:

      Green Tree designated in the notice of transfer an exclusive address for
      sending qualified written requests. Although subsequent correspondence
      sent to the Steeles indicated that they could contact Green Tree or its
      attorneys at other addresses, Green Tree did not indicate that it would
      receive qualified written requests at any other address. Rather, through the
      other addresses and telephone numbers, Green Tree provided the Steeles
      with informal avenues to obtain other information. Because a reasonable
      trier of fact could only find that Green Tree established an exclusive
      location at which it would accept qualified written requests, and that the
      Steeles never sent a proper request to that address, Green Tree had no duty
      under RESPA to respond to the Steeles’s letters.
Id. at *3. As we did in Berneike, 708 F.3d at 1147, we find the Steele court’s

analysis persuasive and in accord with our own.

                                         - 10 -
      Fourth, we reject Ms. Warren’s argument that the Monthly Informational

Statements established Box 6172 as a QWR address. The front page of the

statements stated only that she could send inquiries to Box 6172, not notices of error,

requests for information, or QWRs. Likewise, the back page of the statements told

her she could send correspondence or complaints to Box 6172, but immediately

below the statements instructed that QWRs must be sent to Box 6176. Contrary to

Ms. Warren’s argument, the fact that the QWR notice was titled “For First Lien

Mortgage Loan Customers Only” does not create a disputed fact issue regarding

whether an ordinary consumer would be confused about where she must send a

QWR. An ordinary consumer, faced with the “Correspondence/Complaints” address

(Box 6172) immediately adjacent to the QWR address (Box 6176), could not

justifiably believe she could send a QWR to Box 6172.

      Finally, we find unavailing Ms. Warren’s suggestion that Green Tree’s

responses to her letters show that Green Tree also established Box 6172 as a QWR

address. We rejected a similar argument in Berneike—that a lender “waived its

statutory right to receive all future QWRs at its specified address because it

responded [to the borrower’s correspondence] without asserting [the] correspondence

was sent to the wrong address.” 708 F.3d at 1149. Accord Roth v. CitiMortgage

Inc., 756 F.3d 178, 182 (2d Cir. 2014) (per curiam) (holding that “[a]s long as a

servicer complies with the [regulatory] notice requirements . . . for designating a

QWR address, a letter sent to a different address is not a QWR, even if an employee

                                         - 11 -
at that address (who may not have training in RESPA compliance) in fact responds to

that letter”).

           B. The district court did not err in setting aside the entry of default.

       Ms. Warren alternatively contends that the district court erred in setting aside

the clerk’s entry of default against Green Tree. Our review is for an abuse of

discretion. See Ashby v. McKenna, 331 F.3d 1148, 1152 (10th Cir. 2003).

       In her opening brief, Ms. Warren’s only contention is that Green Tree made no

good-cause showing in its motion to set aside the entry of default. This argument

overlooks both the district court’s denial of Green Tree’s motion as moot and the

court’s reasoning that the entry of default must be set aside because it was directed at

a superseded pleading (the original complaint).

       In her reply, Ms. Warren states that she was given no alternative to filing an

amended complaint and suggests that the district court ordered her to do so “for no

apparent reason other than to allow the Court to rule her motion for default judgment

moot.” Reply Br. at 7. But the district court ruled that filing an amended complaint

was the necessary procedural course arising from Ms. Warren’s own action in

stipulating to the dismissal, purportedly under Fed. R. Civ. P. 41(a), of less than all

claims against Green Tree. See Aplt. App., Vol. I at 110-11.5 She has not argued

       5
          In reaching that conclusion, the district court relied in part on Gobbo
Farms & Orchards v. Poole Chemical Co., 81 F.3d 122, 123 (10th Cir. 1996), for the
proposition that Rule 41(a) does not apply to the “dismissal of less than all claims in
an action,” and on Ethridge v. Harbor House Restaurant, 861 F.2d 1389, 1392
                                                                             (continued)
                                            - 12 -
otherwise. We therefore discern no abuse of discretion in the district court’s order

directing the clerk to set aside the entry of default.

                                   V. CONCLUSION

       The district court’s judgment is affirmed.6

                                              ENTERED FOR THE COURT,

                                              Scott M. Matheson, Jr.
                                              Circuit Judge

(9th Cir. 1988), for the same principle and for its view that amendment is the
appropriate mechanism for dismissing less than all claims against a defendant.
       6
        In view of our disposition, we decline to consider Green Tree’s request that
we affirm on the alternate ground of judicial estoppel.

                                           - 13 -