Snyder v. Bank of America, N.A.

Background

Pamela Marie Snyder sued Bank of America, N.A., asserting that the bank mishandled her loan. After an earlier summary-judgment ruling by Judge Laporte, the remaining claims were Snyder’s intentional and negligent misrepresentation claims concerning written statements that two loan-modification offers complied with the National Mortgage Settlement (NMS).

The first trial payment plan, offered on February 22, 2013, required three payments of $7,640.23 and would have produced a principal reduction of $1,003,478.57 if completed. Snyder made no payments under that plan. A second plan, offered on June 4, 2013, required three payments of $6,200 and would have produced a principal reduction of $1,003,475.57. Snyder also made no payments under the second plan.

Bank of America’s Arguments

Bank of America moved for summary judgment, which asks the court to rule before trial when no genuine dispute over a fact important to the outcome exists. The bank argued that Snyder could not enforce the NMS, that both plans complied with the NMS, and that she lacked evidence of misrepresentation, intent, reliance, and damages.

Standing

The court rejected the bank’s standing argument as a basis for summary judgment. The court explained that Snyder was not trying to enforce the NMS itself. Instead, her claims concerned whether Bank of America misled her by representing that the loan-modification offers complied with the NMS. The court therefore treated Snyder’s lack of standing to enforce the NMS as irrelevant to these misrepresentation claims.

Compliance and Misrepresentation

Bank of America argued that its plans complied with the NMS because it used its own program guidelines to calculate Snyder’s income and debt-to-income ratio. The bank calculated her income using rental income from the subject property and contended that the proposed monthly payments fell within the applicable range.

Snyder presented an expert declaration from Thomas A. Tarter disputing those calculations. Among other things, Tarter opined that the bank incorrectly calculated Snyder’s verified income, used an arbitrary 2.5 multiplier, applied the wrong debt-to-income range, and should have used a net-present-value calculator associated with the Home Affordable Modification Program. Based on his calculations, Tarter concluded that a compliant monthly payment would have been $2,513, substantially below the payments offered by the bank.

The court found that this evidence created a genuine factual dispute about whether the plans complied with the NMS and, consequently, whether the bank misrepresented their compliance. The court did not consider portions of Tarter’s opinions about the bank’s state of mind or Snyder’s damages because it found those opinions outside his expertise or improper legal conclusions. The court concluded that the remaining portions of his analysis still created a material factual dispute.

Intent, Reliance, and Damages

The court also relied on factual disputes identified in Judge Laporte’s earlier summary-judgment ruling. Regarding intent, the evidence included Snyder’s account of conversations with the bank’s agents and the sequence in which the bank revised an earlier offer after Snyder complained about its compliance. The court also noted the substantial difference between the offered payments and the amount Tarter identified as compliant.

Regarding reliance, the court cited evidence of sales receipts, progress-payment receipts, and handwritten notes about construction and supplies. Snyder claimed that she undertook construction in reliance on the bank’s representations. The court stated that a reasonable juror could find that she continued investing in construction because she believed she was being offered a compliant modification that would lead to lower monthly payments and a roughly $1 million principal reduction.

Regarding damages, the court cited Snyder’s deposition testimony that she would have made loan payments if she had received the correct NMS-compliant modification. The court also stated that, if Snyder proved she relied on the bank by proceeding with construction, she could potentially seek damages for construction she would not have undertaken without the alleged misrepresentations.

Disposition

The court denied Bank of America’s motion for summary judgment. It referred the parties to Judge Hixson for a settlement conference before the January 15, 2020 pretrial conference and vacated the December 10, 2019 case-management conference.