Deschaine v. Indymac Mortgage Services

Citation: 617 F. App'x 690Docket: No. 14-15345

Court: Court of Appeals for the Ninth Circuit; June 17, 2015; Federal Appellate Court

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Jurisdiction over the case is established under 28 U.S.C. § 1291, and the district court's dismissal is upheld. 

1. Deschaine's claims of negligent and intentional misrepresentation were properly dismissed due to insufficient detail regarding the alleged statements from IndyMac representatives, failing to meet the heightened pleading standards. He did not adequately plead reliance on these statements, especially considering the timeline of events: after defaulting, obtaining a loan modification, defaulting again, declaring bankruptcy, and seeking another modification. Deschaine also did not provide specific facts to support claims that he refrained from pursuing other options due to reliance on the alleged misrepresentations.

2. The dismissal of Deschaine's breach of contract claim was justified. He did not provide factual allegations indicating that IndyMac failed to meet its express obligations under the Workout Agreement or implied obligations under U.S. Treasury directives. Deschaine's argument regarding IndyMac's use of incorrect income for HAMP qualification lacked supporting documentation. Moreover, IndyMac had no obligation to base its decision on Deschaine's income claims or to prevent foreclosure. IndyMac fulfilled its implied duties under HAMP directives by notifying Deschaine of his qualification status and offering a Modification Agreement consistent with HAMP guidelines.

The district court's dismissal of Deschaine's promissory estoppel claim was upheld due to a lack of a clear and unambiguous promise from IndyMac for a permanent HAMP loan modification. Deschaine's reliance on an oral statement regarding the absence of a foreclosure sale date was deemed unreasonable, particularly since his default activated the power of sale clause in the deed of trust, allowing for nonjudicial foreclosure. Deschaine failed to justify why he believed IndyMac would waive its rights under the loan agreement or why he relied on an oral statement that contradicted written notices he received.

Furthermore, Deschaine's negligence claim was dismissed on the grounds that IndyMac did not owe him a common law duty of care regarding the loan modification process, as its actions were within the conventional role of a lender. Deschaine did not provide evidence that IndyMac acted beyond this scope or induced him to default through negligent servicing.

Lastly, Deschaine's claim of a violation of California Civil Code section 2923.6 was also dismissed. He argued that he did not receive a denial letter or an appeal opportunity for his loan modification request. However, since he defaulted on both the original loan and the Modification Agreement, which classified as a "first lien loan modification," he forfeited his statutory right to appeal any further denials of loan modification applications.

The district court's dismissal of Deschaine's claims was upheld on multiple grounds:

1. **California Civil Code Section 2923.7**: Deschaine was not entitled to a single point of contact due to his prior loan defaults, which negated his statutory rights under this provision.

2. **California Civil Code Section 2924**: Deschaine lacked standing to contest the alleged fraudulent transfer of his deed of trust. Citing Fontenot v. Wells Fargo Bank, the court noted that even if a deed was fraudulently transferred, it was unlikely to prejudice the borrower since promissory notes are negotiable instruments.

3. **California Business and Professions Code Section 17200 (UCL)**: Deschaine’s UCL claims were dismissed because he did not adequately plead a plausible cause of action, failing to establish the necessary legal basis for his claims.

4. **Wrongful Foreclosure**: Deschaine did not demonstrate an unambiguous tender of the entire amount owed, which is a prerequisite under California's tender rule to challenge a foreclosure.

5. **Request to Amend Complaint**: The court denied Deschaine's request to amend his complaint for a third time as he failed to show how he could remedy the defects in his claims.

The court affirmed the dismissal, stating that the case's disposition is not suitable for publication and does not set a precedent, except as allowed under specific rules. Judicial notice of certain documents requested by IndyMac was declined since they were not essential to the case's resolution.