Tag: breach of contract

Bankr. E.D.N.C.: In re KGC Homeowners, Inc.- Pleading Requirements for Negligence and Breach of Fiduciary Duty, Economic Loss Doctrine


KGC Homeowners, Inc. (“KGC”) brought suit against William Douglas Management, Inc. (“WDM”) alleging breach of contract, negligence and breach of fiduciary duty. While conceding that the complaint sufficiently alleged a breach of contract, WDM moved to dismiss the negligence and breach of fiduciary duty claim, pursuant to Rule 12(b)(6) and Iqbal/Twombly.

The elements of a negligence claim are:
(1) The Defendant owed a duty to plaintiff;
(2) The Defendant breached the duty by failing to conform to the required standard of conduct,
(3) The breach of duty resulted in injury to the plaintiff; and
(4) An actual injury to the interests of the plaintiff occurred.… Read More

Tagged with: , , , , ,

Bankr. E.D.N.C.: In re Alvarez- Mortgage Servicing Claims


The Alvarezes purchased their home in 2007 and refinanced in 2009 with PNC Mortgage servicing the loan for Fannie Mae. At that time the mortgage documents provided that the Alvarezes would maintain homeowner’s insurance and property taxes directly, without an escrow account. The Alvarezes began to have financial difficulties in 2012, but were denied mortgage assistance by PNC. Starting in August 2012, the Alvarezes alleged that PNC began misapplying their payments, holding funds in a suspense account and paying taxes and insurance from that account, violating numerous protections under the deed of trust, 12 C.F.R. § 1024.17 and N.C.G.S. § 45-93.… Read More

Tagged with: , , ,

Bankr. M.D.N.C.: Rutledge v. Wells Fargo Bank, N.A.- State Law Claims for Failure Related to HAMP Modification


The Debtor, after various alleged inconsistencies and shenanigans by Wells Fargo in application of her payments and insurance proceeds, as well as failures in the review of her loan modification application, filed bankruptcy and brought suit alleging, among other causes of action, breaches of contract and duties of good faith & fair dealing and fiduciary duty, fraud and constructive fraud, and violations of the North Carolina Unfair and Deceptive Trade Practice Act. Wells Fargo sought dismissal for failing to state a claim. Following Wigod v. Wells Fargo Bank, N.A., 673 F.3d 547 (7th Cir. 2012), the bankruptcy court examined the treatment of allegations of state law violations arising from failures under federal regulations related to the providing and servicing of mortgages, finding that the cases fell into three categories: 1.… Read More

Tagged with: , , , , , , , , , ,

4th Cir.: Jones v. Fulton Bank- Breach of Contract Requires Actual Damages; Standing to Object to Appointment of Substitute Trustee


The Joneses brought a breach of contract claim against Fulton Bank, alleging that Fulton Bank failed to send them a proper thirty-day pre-acceleration notice. See Bayview Loan Servicing, LLC v. Simmons, 654 S.E.2d 898, 901 (Va. 2008). The Joneses also challenged the appointment by Fulton Bank of a Substitute Trustee with instructions to commence foreclosure as not complying with the Deed of Trust. In their third cause of action, the Joneses contended that Fulton Bank breached the implied covenant of good faith and fair dealing under the Uniform Commercial Code. Lastly, the Joneses sought to quiet title to the property.… Read More

Tagged with: , , , ,

Bankr. WDNC: Stonebridge v NVR- Liquidated Damages Clauses; Third-Party Indemnification


In a dispute regarding a failed real estate development, Stonebridge asserted a breach of contract claim.  In response, NVR argued that a liquidated damages provision limited its liability for damages.  The Bankruptcy Court found that Stonebridge could not complain that a negotiated liquidated damages provision was insufficient or invalid.  The Bankruptcy Court also rejected the assertion by Stonebridge that NVR was required to indemnify economic damages, finding that the contract between the parties required indemnification of “damage to property and persons” not as to performance of the contract.

An additional third-party complaint was raised against NVR by William Leath, a guarantor of the loans made to Stonebridge, also asserting breach of contract and indemnification. … Read More

Tagged with: , ,