New Jersey District Court Dismisses Plaintiff’s Class Action Complaint Without Prejudice, Finding Collection Letter on Time-Barred Debt Does Not Violate FDCPA

The United States District Court for the District of New Jersey recently granted defendant debt collector’s motion to dismiss a class action complaint alleging a violation of the Fair Debt Collection Practices Act (the “FDCPA”), 15 U.S.C. §1692 et seq.  Judah v. Total Card, Inc., 2017 WL 2345636 (D.N.J. 2017).  At issue in the case was a certain letter sent by defendant to plaintiff attempting to collect a debt (the “Collection Letter”).  The Collection Letter offered to settle plaintiff’s debt through a single payment or through six monthly payments but also stated, “[t]he law limits how long you can be sued on a debt. Because of the age of your debt, [the owner of the debt] will not sue you for it, and [the owner of the debt] will not report it to any credit agency.” 

Eighth Circuit Court of Appeals Denies Borrowers’ Attempt to Rescind Under TILA

In a case brought by plaintiffs under the Truth in Lending Act (“TILA”) to rescind their mortgage loan, the United States Court of Appeals for the Eighth Circuit recently affirmed the district court’s grant of summary judgment in favor of the defendant lender and servicer (collectively as “defendants”), finding that plaintiffs’ conclusory affidavits could not rebut the presumption that they received the required notices under the TILA and that the disclosure statements received by plaintiffs were within TILA’s allowable margin of error. 

Pennsylvania Superior Court Finds Ambiguity in Title Insurance Policy’s Description of the Insured Property Precludes Summary Judgment

In an action arising out of a failed real estate transaction, the Superior Court of Pennsylvania vacated an order from the Court of Common Pleas denying appellant-insured’s motion for partial summary judgment and granting a cross-motion for summary judgment by appellee-title insurance company on appellant’s claims.  See Michael v. Stock, 2017 PA Super 99 (Super. Ct. 2017), reargument denied (June 13, 2017). 

New Jersey Appellate Division Affirms That Refinancing Mortgage Should Be Granted Priority Over Life Estates Under the Principles of Replacement and Modification

In a decision approved for publication on July 10, 2017, New Jersey’s Appellate Division held that if a lender holds a priority lien on a property and replaces it with a new mortgage via a refinancing, that new mortgage is entitled to priority regardless of the lender’s knowledge of other encumbrances so long as the intervening lienors are not materially prejudiced. See Ocwen Loan Servs., LLC v. Quinn, 2016 WL 6156209 (N.J. Super. Ct. App. Div. Oct. 24, 2016), cert. denied, 2017 WL 658798 (N.J. Feb. 13, 2017).

New Jersey Chancery Division Holds That Courts Cannot Appoint Custodial Receivers in Foreclosure Actions of Single-Family Residential Dwellings

In a noteworthy decision that was approved for publication on June 29, 2017, the New Jersey Chancery Division held that the appointment of a custodial receiver in a foreclosure action of a single-family home or condominium would run counter to the purpose of the Fair Foreclosure Act (“FFA”) (N.J.S.A. 2A:50-03 et seq.) and the FFA’s required notices and other procedures providing homeowners with opportunities to cure foreclosure defaults and keep their homes.

Illinois Federal Court Denies Bad Faith Claim Against Title Insurance Company and Holds Exclusion 3(a) May Apply to Bar Breach of Contract Claim

The United States District Court for the Northern District of Illinois recently dismissed an insured lender’s bad faith claim against a title insurance company and held that Exclusion 3(a) of the policy may bar the lender’s breach of contract claim.  See Bank of Am., N.A. v. Chicago Title Ins. Co., 2017 WL 2215012 (N.D. Ill. May 18, 2017). 

New Jersey Appellate Division Affirms Dismissal of Plaintiff’s Fraudulent Transfer Claim Against Title Agent and Title Insurance Company

The Superior Court of New Jersey, Appellate Division, recently affirmed the trial court’s grant of summary judgment dismissing plaintiff’s complaint against multiple defendants, including the title agent and title insurance company, alleging fraudulent transfer of title to realty, holding that “one, who knows a deed transferring her ownership in property has been filed, but declines to repudiate that conduct and also acts to later approve the conduct and benefits from same, has ratified the conduct and loses the right to challenge the forgery.”