Filed: Sep. 18, 2007
Latest Update: Feb. 21, 2020
Summary: United States Court of Appeals UNITED STATES COURT OF APPEALS Fifth Circuit FOR THE FIFTH CIRCUIT F I L E D September 18, 2007 Charles R. Fulbruge III Clerk 07-30032 Summary Calendar YOLANDA M. SANDERS, Plaintiff, ANDRIA C. ROBINSON; CHARLES ROBINSON Intervenor Plaintiffs-Appellants, v. WASHINGTON MUTUAL HOME LOANS, INC., by and through its successor Washington Mutual Bank, formerly known as Fleet Mortgage Corporation Defendant-Intervenor Defendant-Appellee. Appeals from the United States Distri
Summary: United States Court of Appeals UNITED STATES COURT OF APPEALS Fifth Circuit FOR THE FIFTH CIRCUIT F I L E D September 18, 2007 Charles R. Fulbruge III Clerk 07-30032 Summary Calendar YOLANDA M. SANDERS, Plaintiff, ANDRIA C. ROBINSON; CHARLES ROBINSON Intervenor Plaintiffs-Appellants, v. WASHINGTON MUTUAL HOME LOANS, INC., by and through its successor Washington Mutual Bank, formerly known as Fleet Mortgage Corporation Defendant-Intervenor Defendant-Appellee. Appeals from the United States Distric..
More
United States Court of Appeals
UNITED STATES COURT OF APPEALS Fifth Circuit
FOR THE FIFTH CIRCUIT F I L E D
September 18, 2007
Charles R. Fulbruge III
Clerk
07-30032
Summary Calendar
YOLANDA M. SANDERS,
Plaintiff,
ANDRIA C. ROBINSON; CHARLES ROBINSON
Intervenor Plaintiffs-Appellants,
v.
WASHINGTON MUTUAL HOME LOANS, INC., by and through its successor
Washington Mutual Bank, formerly known as Fleet Mortgage
Corporation
Defendant-Intervenor Defendant-Appellee.
Appeals from the United States District Court for the
Eastern District of Louisiana
No. 05-CV-2166
Before WIENER, GARZA, and BENAVIDES, Circuit Judges.
PER CURIAM:*
Andria and Charles Robinson (“the Robinsons”),
intervenor–plaintiffs, appeal the district court’s grant of
Washington Mutual Home Loan’s Motion for Partial Summary Judgment.
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
For the following reasons, we affirm.
I. BACKGROUND
In 2003, the Robinsons became delinquent on their home
mortgage loan payments, and Washington Mutual Home Loans
(“Washington Mutual”) instituted a foreclosure proceeding on
November 5, 2003. The Robinsons thereafter contacted Washington
Mutual about their options to avoid foreclosure and indicated their
interest in a possible loan modification, which would terminate the
foreclosure action and suspend the collection of delinquent
amounts. Washington Mutual developed a proposed modification plan
that would (1) reinstate the loan; (2) capitalize amounts for
delinquent interest, previously incurred foreclosure fees and
costs, and escrow advances; (3) decrease the interest rate; and (4)
extend the loan’s maturity date.
Washington Mutual sent the Loan Modification Agreement
(“LMA”), along with a cover letter explaining the terms of the LMA,
to the Robinsons on December 23, 2003. The cover letter explained
that in order for the LMA to become effective, the Robinsons would
be required to pay a $500 “Administrative Fee” at the time of
execution.1 Three days later, on December 26, 2003, the Robinsons
signed the LMA and returned it to Washington Mutual, along with a
payment that included the $500 Administrative Fee.
1
According to Washington Mutual, the purpose of this fee was
to compensate Washington Mutual for the numerous costs associated
with modifying the loan agreement.
2
On July 25, 2005, the Robinsons intervened as plaintiffs in a
lawsuit against Washington Mutual. In the “Amended and Superseding
Complaint,” the Robinsons asserted a separate claim that the $500
Administrative Fee was “illegal” because it was not provided in a
writing signed by them, in violation of LA. REV. STAT. ANN. § 6:1097.2
On September 6, 2006, Washington Mutual moved for partial
summary judgment on this claim, asserting that (1) federal law
preempts the Robinsons’ state law claim; (2) even if the Louisiana
statute applies, Washington Mutual complied with its requirements;
(3) the Louisiana statute does not prohibit the fees at issue; (4)
the original Note and Mortgage authorized the fees at issue; and
(5) Louisiana’s voluntary payment doctrine independently bars the
Robinsons’ claim. On November 29, 2006, the district court orally
granted Washington Mutual’s motion for partial summary judgment.3
The Robinsons now appeal.
2
LA. REV. STAT. ANN. § 6:1097(A) provides, in relevant part:
“Notwithstanding any other law to the contrary, . . . the parties
to a federally related mortgage loan may agree to the payment of
any fees, charges, costs, and expenses, and the amounts thereof .
. . if the fees, charges, costs, and expenses, and the amounts
thereof, or the methods for fixing such, are provided in a
writing signed by the consumer.”
3
It is difficult for this Court to determine the exact
grounds for the district court’s ruling. The court seems to
grant the motion based on basic contract principles, stating that
the LMA “was a new arrangement . . . and the $500 was disclosed”
and the Robinsons “agreed to pay the $500 fee.” Regardless, this
Court may “affirm summary judgment on any ground supported by the
record, even if it is different from that relied on by the
district court.” Holtzclaw v. DSC Commc’ns Corp., 255 F.3d 254,
258 (5th Cir. 2001).
3
II. STANDARD OF REVIEW
We review the district court’s grant of summary judgment de
novo, applying the same standard as the district court. Atkins v.
Hibernia Corp., 182 F.3d 320, 323 (5th Cir. 1999). Summary
judgment is appropriate when the record establishes “that there is
no genuine issue as to any material fact and that the moving party
is entitled to judgment as a matter of law.” FED. R. CIV. P. 56(c).
III. DISCUSSION
The Robinsons assert that the Administrative Fee violates LA.
REV. STAT. ANN. § 6:1097 because it was not provided in a writing
signed by them. Washington Mutual, on the other hand, asserts the
same five arguments contained in its original Motion for Partial
Summary Judgment. Because Louisiana’s voluntary payment doctrine
bars the Robinsons from recovering the $500 fee, this Court need
not consider the other issues before it.4
Louisiana courts have long held that “[t]here is no principle
of law better settled than that money voluntarily paid with
4
The voluntary payment doctrine prevents recovery even if
the Administrative Fee violated § 6:1097 because the doctrine
goes to the Robinsons’ ultimate ability to recover, regardless of
liability. See Sutton Steel & Supply, Inc. v. BellSouth
Mobility, Inc., 875 So. 2d 1062, 1070 (La. Ct. App. 2004). Thus,
even if the $500 fee was “illegal,” the voluntary payment
doctrine may nevertheless prevent the Robinsons from recovering
that money from Washington Mutual. See Carter v. Montgomery Ward
& Co.,
413 So. 2d 309, 314 (La. Ct. App. 1982) (holding that
where an employee had no right to workers compensation benefits
once he was well and able, the voluntary payment doctrine
nonetheless precluded the employer from recovering such
overpayments).
4
knowledge of the facts cannot be recovered back.” Ken Lawler
Builders, Inc. v. Delaney, 892 So. 2d 778, 780 (La. Ct. App. 2005)
(citation omitted). This doctrine exists because of “the
stabilizing legal principle preventing payors from disturbing the
status quo by demanding reimbursement subsequently of payments made
by them voluntarily with full knowledge of [the] facts.” Whitehall
Oil Co. v. Bogani,
255 So. 2d 702, 705 (La. 1969);5 see also Hicks
v. Levett,
140 So. 276, 281 (La. Ct. App. 1932) (“If in every
instance in which a man is in doubt as to which is the safe course
to pursue, he can pay under protest and then sue to recover back,
it is difficult to see where litigation ends.”).
It is clear that the Robinsons voluntarily paid the
Administrative Fee with knowledge of the relevant facts.
Washington Mutual specifically disclosed that it was assessing a
$500 Administrative Fee in exchange for modifying the loan. To the
extent the Robinsons did not understand the nature of the fee or
objected to its imposition, the cover letter provided a toll-free
number to call if they had any “additional questions or concerns.”
The Robinsons could have objected or disputed the fee at that time;
however, the Robinsons signed the LMA and paid the Administrative
5
The Robinsons cite Bogani in support of their position that
the voluntary payment doctrine is no longer an impediment under
Louisiana law. The Bogani court, however, recognized the
validity of the doctrine, but merely concluded that it was not
applicable to the specific oil royalty overpayments at issue in
the case.
5
Fee in full.
Furthermore, the Robinsons cannot argue that the payment was
made under duress and, therefore, was not voluntary. Duress exists
where either (1) “a person physically compels conduct” or (2) “a
person makes an improper threat that induces a party who has no
reasonable alternative to manifest his assent.” Comeaux v. Entergy
Corp., 734 So. 2d 105, 107 (La. Ct. App. 1999). Although
homeowners faced with foreclosure may agree to any fee required to
stop such foreclosure, the threat of foreclosure does not
constitute duress. See LA. CIV. CODE ANN. art. 1962 (“A threat of
doing a lawful act or a threat of exercising a right does not
constitute duress.”); Southmark Props. v. Charles House Corp.,
742
F.2d 862, 876 (5th Cir. 1984) (“[I]t is the established rule that
it is not duress to institute or threaten to institute civil suits,
or take proceedings in court . . . at least where the threatened
action is made in good faith . . . .”).
The Robinsons, however, argue that LA. CIV. CODE ANN. art. 2299
permits their recovery, eliminating the impediment posed by the
voluntary payment doctrine. Art. 2299 states: “A person who has
received a payment or a thing not owed to him is bound to restore
it to the person from whom he received it.” This statute, however,
is inapplicable to the case at hand. The purpose of arts. 2298-
2305 is to prevent unjust enrichment by “establish[ing] a cause of
action against one who has been enriched without cause at the
6
expense of another.” Onstott v. Certified Capital Corp., 950 So.
2d 744, 749 (La. Ct. App. 2006); see also Evangeline Iron Works,
Ltd. v. Lyons,
96 So. 2d 578, 580 (La. 1957) (stating that art.
2301–the predecessor statute of art. 2299–establishes a cause of
action in quasi-contract). Here, however, the Robinsons did not
assert any cause of action sounding in unjust enrichment as the
basis for their recovery of the $500;6 therefore, art. 2299 is
inapplicable and cannot prevent the application of the voluntary
payment doctrine.
Thus, the voluntary payment doctrine bars the Robinsons’
recovery of the Administrative Fee.7
6
The Robinsons never contend that the Administrative Fee was
excessive, unwarranted, or unjustified based on the services
provided by Washington Mutual; instead, the Robinsons’ contention
is merely that they should not have been required to pay the fee
because the fee was provided in the cover letter, not the LMA.
Indeed, it is unsurprising that the Robinsons make no claim based
on unjust enrichment, as there is no unjust enrichment to
rectify–Washington Mutual provided an extra service to the
Robinsons, and the Robinsons paid a fee in exchange for that
service. In fact, if this Court were to nullify the
Administrative Fee, then it would be the Robinsons who are
enriched at the expense of Washington Mutual, as they would have
received a valuable service–the modification of their loan–for
free.
7
This result may seem initially harsh, as homeowners are in
a disparate bargaining position with mortgagees threatening to
foreclose on their homes and are likely to agree to any fee to
prevent such foreclosure. However, this harsh result is tempered
by the potential application of art. 2299, which will allow such
homeowners to contest and recover fees that are excessive,
unwarranted, or unjustified. Under this Court’s analysis,
homeowners will simply be unable to recover fees knowingly and
voluntarily paid where such fees are an accurate assessment of
services rendered.
7
For the foregoing reasons, the order of the district court is
AFFIRMED.
8
