Tuesday, July 17, 2007

consumer - bankruptcy - stay

GMAC v. Buchanan - Superior Court - June 11, 2007


Defendant's petition to set aside a sheriff's sale rejected. Sale was not subject to any automatic stay, as a result of defendant's third bankruptcy with the immediately preceding 12-month period, during which two previous bankruptcy petitions were pending and dismissed, under the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, 11 USC 362(c)(4)(A)(i).

consumer - debt collection - letter not false, deceptive, or misleading

Rosenau v. Unifund Corp. - ED Pa. 0 June 28, 2007


A letter from a debt collector is not false, deceptive or misleading where it says that "if we are unable to resolve this issue within 35 days we may refer this matter to an attorney in your area for legal consideration." Plaintff alleged that it was false, etc., because it was, in fact, not prepared, reviewed, and/or sent by a legal department or a lawyer but could reasonably be read that way, from the perspective of the least sophisticated debtor (LSD).

The FDCPA, 15 USC 1692 et seq., prevents liability for "bizarre or idiosyncratic interpretations of collection notices by preserving a quotient of reasonableness and presuming a basic level of understanidng and willingness to read with care."

Here, plaintiff's intepretation was bizarre and idiosyncratic, in urging that the LSD would believe the letter came from an attorney, when in fact it did not. Even an LSD could not reasonably interpret the letter as having been written or reviewed by an attorney. There is no other reasonable intepretation and therefore the letter is not false, deceptive or misleading.

consumer - appraiser - liability

Morilus v.Countrywide Home Loans, Inc. - ED Pa. - June 20, 2007


The plaintiff sued an appraisal company under a number of consumer protection statutes, claiming that the company had conspired to unfairly and deceptively induce plaintiff to execute the loan, based on a falsely inflated appraisal price, with monthly payments that plaintiff could not afford. The court sustained defendant's motion to dismiss some of plaintiff's claims, including

- Truth in Lending Act, 15 USC 1601 et seq., because the defendant was not a creditor
- Home Ownership and Real Estate Protection Act, 15 USC 1639(a), because defendant was not a "creditor"
- Equal Credit Opportunity AQct 15 USC 1691a(e), because defendant was not involved in any credit decision
- Pennsylvania Fair Credit Extension Uniformity Act, 73 PS 2270 et seq., because defendant was not a "creditor"
- Pennsylvania Credit Services Act, 73 PS 2182, because defendant was not a "creditor" or credit services organization
- punitive damages - there was no allegation that D knew of a high risk of harm to P or that it acted deliberately and outrageously and with a conscious disregard of the risk.

The court also rejected the following claims but gave plaintiff leave to file an amended complaint with the necessary allegations, as follows

- Real Estate Settlement Procedures Act, 12 USC 2601 et seq. - to sustain her claim that the defendant was part of a fraudulent scheme to improperly split settlement charges, plaintiff would have to allege that she made a "qualified written request" to the lender stating that her account was in error

- Pennsylvania Consumer Protection Law - Plaintiff did not make any allegations that met the requirements of common law fraud, including a material misreprentation of an existing fact, scienter, jusitifiable reliance on the misrepresentation, and damages, citing Booze v. Allstate Insurance, 750 A.2d 877, 880 (Pa. Super. 2000) [But see Commonwealth v. Percudani, 825 A.2d 743 (Pa. Cmwlth 2003), noting that amendments to the CPL statute negated this requirement. ]

- fraud claim - both state and federal pleading law requires pleading with more particularity that in the existing complaint.

consumer - Fair Credit Reporting Act - refusal to investigate disputed debt

Klotz v. Trans Union, LLC - ED Pa. - July 2, 2007


In the course of rejecting the plaintiff's motion to certify a class, the court held that the defendant credit reporting agency (CRA) did not have a duty to investigate plaintiff's dispute about his credit report , since

- plaintiff's documents were prepared by a third party credit repair organization (CRO)
- plaintiff did not notify the CRA directly of his dispute, as required by 15 USC 1681i(a)(1)(A)
- plaintiff did not prepare or read the dispute, just signed it and sent it in
- plaintiff did not prove the inaccuracy of the CRA's information, as required by 15 USC 1681i

The court relied on the decision in Cushman v. Trans Union Corp. 115 F.3d 220 (3d Cir. 1997)

mobile homepark rights act - park closures - HB 1673 (proposed)

This recently introduced bill would require written notice to park residents within 30 days of the park owner entering into an agreement for the sale of the park.

You can see HB 1673 at http://www.legis.state.pa.us/cfdocs/legis/home/bills/topindex.cfm

The notice would have to include
- the estimated date that residents will be expected to vacate, no sooner than 180 days of getting notice
- the estimated date that the park will be closed.
- a receipt from one adult resident in each home showing that the notice was received
- a right of first refusal to existing residents and neootiation in good faith
- payment of relocation expenses equivalent to 6 months rent
- pay the appraised value of the home of the tenant cannot find a suitable replacement site

Park owners could not refused to admit used home thyat are in good and tenantable condition