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Alison Brisbin v. Aurora Loan Services

May 21, 2012

ALISON BRISBIN,
APPELLANT,
v.
AURORA LOAN SERVICES, LLC; MORTGAGE
ELECTRONIC REGISTRATION SYSTEMS, INC.;
FEDERAL HOME LOAN MORTGAGE CORPORATION,
APPELLEES.



Appeal from the United States District Court for the District of Minnesota.

The opinion of the court was delivered by: Gruender, Circuit Judge.

Submitted: February 15, 2012

Before GRUENDER, BENTON, and SHEPHERD, Circuit Judges.

Alison Brisbin filed this lawsuit in Minnesota state court against Aurora Loan Services, LLC; Mortgage Electronic Registration Systems, Inc.; and Federal Home Loan Mortgage Corporation (collectively "lender"), seeking legal and equitable relief from the lender's foreclosure and sale of her home. She alleged three legal theories for invalidation of the foreclosure sale (respectively Counts I through III): failure to comply with the notice requirements of the Minnesota foreclosure-by-advertisement statute, promissory estoppel, and breach of the lender's United States Department of the Treasury Home Affordable Modification Program ("HAMP") Participation Agreement, which Brisbin alleged was intended to benefit her as a third-party beneficiary. She also alleged two legal theories for the recovery of damages resulting from the foreclosure sale (respectively Counts IV and V): negligent misrepresentation and intentional misrepresentation. The lender removed the case to federal court and subsequently moved for summary judgment on all Counts. The district court*fn1 granted the motion, and Brisbin appeals. We affirm.

I. BACKGROUND

Brisbin purchased five homes in the Minneapolis-St. Paul area between 2000 and 2006. This case involves her home on Emerson Avenue, which she purchased in 2006 for $310,000 using a $248,000 mortgage from the lender. Brisbin also obtained a second mortgage in the amount of $62,000. During the housing crisis of 2008, Brisbin became delinquent on her mortgages on this house as well as on three of her other properties. The lender sent Brisbin a letter disclosing alternatives to foreclosure in April 2009. Brisbin contacted the lender in July to seek a forbearance, which the lender denied in early August. Shortly thereafter, however, the lender placed Brisbin into a trial forbearance program. In mid-September, the lender returned Brisbin's payment under the forbearance program, informed her that she did not qualify for forbearance, and served her with foreclosure documents, including a notice scheduling a foreclosure sale for October 23, 2009.

Brisbin contacted the lender on September 25, 2009, to request a loan modification. The lender concedes that it told Brisbin the foreclosure sale would be postponed to give it time to consider her request for a loan modification.

Nevertheless, the lender did not postpone the foreclosure sale, and it purchased the house at the foreclosure sale on the originally scheduled day. The lender's records indicate that it denied Brisbin's loan modification request on October 26, 2009, because "the foreclosure sale ha[d] already been completed." The records also indicate that Brisbin called on October 30 to find out why the loan modification was denied, that the lender then began a review of why the modification was denied, and that the lender did not advise Brisbin that her house had been sold. The lender then arranged for Brisbin to reapply for a loan modification, and she submitted an application on November 23, 2009. On April 16, 2010, the lender informed Brisbin that the foreclosure sale had occurred in October, that she would not receive a loan modification, and that her redemption period would expire on April 23, 2010. On either April 22 or 23, the lender offered to rescind the sale if Brisbin could settle the account that day. Brisbin did not pay, and the foreclosure sale was not rescinded.

On April 23, 2010, Brisbin filed this lawsuit. The lender subsequently moved for summary judgment, arguing that it had provided proper notice of foreclosure, that the Minnesota Credit Agreement Statute ("MCAS") precluded enforcement of its oral promise to postpone the foreclosure sale, and that Brisbin had not demonstrated that she had detrimentally relied on the promise to postpone the sale. Brisbin argued in response that the foreclosure sale was invalid because the lender did not publish notice of the postponement it promised her as required by the foreclosure-by-advertisement statute, that the MCAS did not bar her claims, and that she did detrimentally rely on the lender's promise by failing to attempt to sell the home or borrow money to reinstate the mortgage.

The district court granted the lender's motion for summary judgment in its entirety. In granting summary judgment on Count I, the district court stated that the Minnesota foreclosure-by-advertisement statute provided no basis to invalidate the foreclosure sale, concluding that there was no genuine question of fact that Brisbin was the "party requesting the postponement" and that the lender therefore had no statutory obligation to publish notice of the postponement. Regarding Count II's claim for promissory estoppel, the district court concluded that the MCAS bars enforcement of the lender's oral promise to postpone the sale. In disposing of Count III, the court held that Brisbin was not a third-party beneficiary of the lender's HAMP Participation Agreement. With respect to Counts IV and V, the court concluded that there was no genuine question of fact as to whether Brisbin detrimentally relied on the lender's promise because she provided no evidence that she would have been able to borrow money to reinstate the mortgage or sell the home if she had tried.

In appealing the grant of summary judgment on Count I, Brisbin contends that the district court erred in concluding that there was no genuine question of material fact as to whether she requested the postponement. With respect to Count II, she contends that the district court erred in concluding that the MCAS bars enforcement of the lender's oral promise to postpone the foreclosure sale. With respect to Counts IV and V, Brisbin contends that the district court erred in concluding that there was no genuine question of material fact as to whether she detrimentally relied on the lender's promise to postpone the foreclosure sale. She does not appeal the decision on Count III.

II. DISCUSSION

We review the district court's grant of summary judgment de novo. Taylor v. St. Louis Cnty. Bd. of Election Comm'rs, 625 F.3d 1025, 1026 (8th Cir. 2010) (per curiam). "Summary judgment is appropriate where, viewing the record in the light most favorable to the nonmoving party, there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law." Id. at 1026. The parties agree that we are to apply Minnesota law. See Kaufmann v. Siemens Med. Solutions USA, Inc., 638 F.3d 840, 843 (8th Cir. 2011). We review de novo the district court's interpretation of Minnesota law, Triton Corp. v. Hardrives, Inc., 85 F.3d 343, 345 (8th Cir. 1996), and, unless the outcome of the case is dictated by ...


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