ORDER

BENJAMIN A. KAHN, UNITED STATES BANKRUPTCY JUDGE.

THIS CASE came before the Court for hearing on the Objection to Notice of Postpetition Fees (the "Objection") filed by Debtor Rosetta Woods Paylor on October 10, 2018. ECF No. 31. At the hearing, Koury Hicks appeared on behalf of Debtor, Andrew L. Vining appeared on behalf of Ditech Financial, LLC ("Ditech"), and Benjamin Lovell appeared on behalf of the Standing Trustee (the "Trustee"). For the reasons set forth below, the Objection will be overruled.

BACKGROUND

Debtor filed a petition for relief under chapter 13 of the Bankruptcy Code on October 25, 2017. In December of the same year, U.S. Bank National Association, as Trustee, as successor to Firstar Trust Company as Trustee, for Manufactured Housing Contract Senior/Subordinate Pass-Through Certificate Trust 1996-3 ("U.S. Bank"), filed a proof of claim on Official Form 410 in the amount of $43,857.51. Claim No. 2-1. The claim provides that notices should be sent to U.S. Bank care of Ditech. The debt reflected in the claim arises from a mortgage loan secured by a deed of trust on Debtor's principal residence. Id. at 16. Among other provisions, the deed of trust requires the borrower to maintain hazard insurance as follows:

Id. at 19, ¶ 5. Attached to the claim is a Limited Power of Attorney (the "U.S. Bank Power of Attorney") executed on behalf of U.S. Bank appointing Ditech as servicer and attorney in fact for broad purposes with respect to the underlying loan documents, including demanding, suing, collecting, or recovering any amount due to U.S. Bank in any bankruptcy action. Id. at 25-29 (particularly at 27, ¶ 1).

On July 30, 2018, Ditech filed a Notice of Postpetition Mortgage Fees, Expenses, and Charges (the "Postpetition Notice"), alleging $1,007 owed for "Lender Placed Insurance Effective 2/3/18-2/3/19."1 The Postpetition Notice specifically refers to Claim No. 2 but lists Ditech as the creditor.

Debtor objected to the Postpetition Notice, alleging Ditech's failure to comply with N.C. Gen. Stat. § 45-91(1). According to Debtor, Ditech waived its right to payment for the insurance under § 45-91(3) because Ditech charged Debtor for the insurance without: (1) timely assessing the insurance; and (2) producing a copy of the clear and conspicuous explanatory statement about the insurance mailed to Debtor at her last known address.2 Debtor also objected to Ditech's filing of the Postpetition Notice, arguing that the holder of the claim did not file the notice as required by Federal Rule of Bankruptcy Procedure 3002.1.

Ditech timely responded to the Objection. ECF No. 31.3 Ditech asserts that insurance is not a "fee" as contemplated by § 45-91(1). According to Ditech, § 45-91(1) does not apply to expenses typically collected by a lender or servicer for escrow accounts, and because a lender or servicer usually includes insurance as an escrow item, the insurance expense is not a "fee" as contemplated by the statute. Thus, Ditech argued that the time limits and notice requirements of § 45-91(1) are inapplicable. Ditech also asserted compliance with Rule 3002.1 in that U.S. Bank listed its claim as "care of" Ditech. Following the arguments of counsel, the Court took the matter under advisement.

DISCUSSION

The parties present two issues: (1) whether an expense incurred by a servicer for lender placed hazard insurance constitutes a "fee" under North Carolina General Statute § 45-91(1); and (2) whether the Postpetition Notice was defective because it was filed and served by Ditech and listed Ditech as the creditor on the official form.

A. An expense incurred by a servicer for a force placed insurance premium is not a fee as contemplated by N.C. Gen. Stat. § 45-91(1).

Chapter 45 of the North Carolina General Statutes governs mortgages and deeds of trust, including mortgage debt collection and servicing under Article 10. Pursuant to Article 10, a servicer of a home loan must comply with the time limits and notice requirements of § 45-91(1), which provides as follows:

N.C. Gen. Stat. § 45-91(1) (2018).4 If a servicer fails to comply with these requirements, the fee is waived. § 45-91(3).5

Neither Article 10 nor the remainder of Chapter 45 contains a definition for the term "fee," see §§ 45-21.1, 45-36.4, 45-67, 45-81, 45-90,6 and 45-101,7 and the meaning of "fee" as contemplated by § 45-91(1) has not been addressed by the North Carolina courts. Because state law controls and there is no state law addressing the issue, the Court "must ... offer its best judgment about how [North Carolina's] highest court would rule [on the issue], giving appropriate weight to any opinions of [North Carolina's] intermediate appellate courts." Anderson v. Sara Lee Corp., 508 F.3d 181, 190 (4th Cir. 2007) (citing Food Lion, Inc. v. Capital Cities/ABC, Inc., 194 F.3d 505, 512 (4th Cir. 1999)). The Court must therefore anticipate how the North Carolina Supreme Court would interpret the term "fee" as contemplated by § 45-91.

The North Carolina Supreme Court adheres to the following principles of statutory construction:

Elec. Supply Co. of Durham v. Swain Elec. Co., 328 N.C. 651, 656, 403 S.E.2d 291, 294 (1991). A court may examine the legislative history of a statute only when, after analyzing the plain terms and structure, the court still is in doubt as to the legislative intent. Id. at 656, 403 S.E.2d at 295.

A statute's plain words are accorded their "natural and ordinary meaning unless the context requires otherwise." Turlington v. McLeod, 323 N.C. 591, 594, 374 S.E.2d 394, 397 (1988). That is, "[n]othing else appearing, the [North Carolina] Legislature is presumed to have used the words of a statute to convey their natural and ordinary meaning." Perkins v. Ark. Trucking Servs., Inc., 351 N.C. 634, 638, 528 S.E.2d 902, 904 (2000) (quoting In re McLean Trucking Co., 281 N.C. 242, 252, 188 S.E.2d 452, 458 (1972)). When "determining the plain meaning of undefined terms," the Supreme Court of North Carolina relies on "`standard, nonlegal dictionaries' as a guide." Midrex Techs., Inc. v. N.C. Dep't of Revenue, 369 N.C. 250, 258, 794 S.E.2d 785, 792 (2016) (quoting Elec. Supply Co., 328 N.C. at 656, 403 S.E.2d at 294) (consulting New Oxford American Dictionary (Angus Stevenson & Christine A. Lindberg eds., 3d ed. 2010) ("New Oxford") to interpret the meaning of the term "building" in § 105-130.4(a)(4)); see also Turlington v. McLeod, 323 N.C. 591, 594, 374 S.E.2d 394, 397 (1988) (citing Webster's Third New International Dictionary 2394 (1976) ("Webster's") and The American Heritage Dictionary of the English Language 1345 (1969) for a definition of "timber" that, in ordinary usage, gave effect to the statute's intent); Black v. Littlejohn, 312 N.C. 626, 638, 325 S.E.2d 469, 478 (1985) (citing Webster's (1971)) for a definition of "injury"). For terms commonly used in a legal and nonlegal context, the North Carolina Supreme Court also has relied on Black's Law Dictionary. See, e.g., Walker v. Bd. of Trs. of the N.C. Local, Governmental Emps.' Ret. Sys., 348 N.C. 63, 66, 499 S.E.2d 429, 431 (1998) (citing Black's Law Dictionary 1471 (6th ed. 1990) for a definition of "terminate" as used in chapter 128 of the North Carolina General Statues because "this word is unambiguous"); Nelson v. Battle Forest Friends Meeting, 335 N.C. 133, 136, 436 S.E.2d 122, 124 (1993) (relying on Deluxe Black's Law Dictionary 41 (6th ed. 1990), in addition to The Random House Dictionary of the English Language 25 (2d ed. 1987) ("Random House"), Chambers English Dictionary 16 (1988), and The Oxford English Dictionary 156 (2d ed. 1989), for definitions of the term "adjoin" as used in § 1-44.2).

Finally, the court should "look at various related statutes in pari materia so as to determine and effectuate the legislative intent." Craig v. Cty. of Chatham, 356 N.C. 40, 46, 565 S.E.2d 172, 176 (2002); cf. In re R.L.C., 361 N.C. 287, 294, 643 S.E.2d 920, 924 (2007) ("When determining the meaning of a statute, the purpose of viewing the statute in pari materia with other statutes is to harmonize statutes of like subject matter and, if at all possible, give effect to each.")

(1) The natural and ordinary meaning of "fee" as used in § 45-91(1) does not include an insurance premium.

By its plain terms, N.C. Gen. Stat. § 45-91(1) applies only to "any fee8 incurred by a servicer9 ...." Guided by standard dictionaries on which the North Carolina Supreme Court previously has relied, the natural and ordinary meaning of "fee" in Chapter 45 does not contemplate payments for insurance premiums.

The term "fee" is frequently used in both legal and nonlegal contexts. The dictionaries previously cited by the North Carolina Supreme Court include a number of definitions of "fee" inapplicable to Chapter 45. For example, "fee" is variously defined as an estate of inheritance in land, see Random House, supra, at 706 (2001); see also New Oxford, supra, at 634 (same); Webster's, supra, at 833 (same) (2002), personal property, an allowance, wages, or reward for a servant, or a charge for admission. Webster's, supra, at 833 (2002). None of these definitions comport with the meaning of fees that may be incurred by a servicer or with the nature of insurance premiums as discussed below.

The definitions the Court will consider in more detail include the following:

Deluxe Black's Law Dictionary 614 (6th ed. 1990).

Webster's, supra, at 833.

New Oxford, supra, at 634.

Random House, supra, at 705-06 (2001).

III The Century Dictionary and Encyclopedia 2168 (1911).

C.M. Schwarz, The Chambers Dictionary (13th ed. 2015).

These definitions fall into two general categories. First, a fee is defined as a charge fixed by a contract, law, or institution in exchange for certain privileges or personal services, such as a filing fee, registration fees, license fee, or other fixed charge. Second, a fee is defined as a charge for professional services, such as an attorney's fee or a trustee's fee. Insurance and insurance premiums fall into neither of these two categories because, for the reasons that follow, insurance premiums are not a fixed charge for a personal service, nor does insurance constitute a professional service as contemplated by Chapter 45.

a. An insurance premium is not a fixed charge for a personal service.

Generally, insurance is not considered a personal service for which premiums are charged.10 In North Carolina, insurance contracts are governed by state law, § 58-3-1,11 and are defined as

§ 58-1-10.

An insurer's contractual obligation to pay money under a hazard insurance policy is not a personal service; that is, insurance is not work or labor,12 nor is it related to other personal services. Cf. Mitchell, Brewer, Richardson, Adams, Burge & Boughman v. Brewer, No. 06 CVS 6091, 2013 WL 765372, at *6 (N.C. Super. Feb. 26, 2013), aff'd, 803 S.E.2d 433 (N.C. Ct. App. 2017) (describing "personal services" as "personal skill and effort"); Henry Angelo & Sons, Inc. v. Prop. Dev. Corp., 63 N.C. App. 569, 574, 306 S.E.2d 162, 166 (1983) (quoting Black's Law Dictionary 943 (rev. 4th ed. 1968) ("Insurance is `a contract whereby, for a stipulated consideration, one party undertakes to compensate the other for loss on a specified subject by specified perils.'")); Fairbanks v. Superior Court, 46 Cal.4th 56, 61, 92 Cal.Rptr.3d 279, 205 P.3d 201, 203 (2009) (concluding that insurance is not a service for purposes of California's Consumer Legal Remedies Act, Cal. Civil Code § 175, et seq., and observing that "[a]n insurer's contractual obligation to pay money under a life insurance policy is not work or labor, nor is it related to the sale or repair of any tangible chattel");13 see also Buckley v. Cracchiolo, Case No. 2:13-cv-4609-CAS(PJWx), 2014 WL 545751 (C.D. Cal. Feb. 7, 2014) (extending holding in Fairbanks to automobile insurance).

Further, even if an insurance premium could be considered a charge for a service, the natural and ordinary meaning of "fee" under § 45-91 does not include an insurance premium because such premium is not a fixed charge. Instead, "[t]he amount of the premium varies in proportion to the risk assumed." Couch on Insurance, supra, § 69:1.14 Therefore, the Court concludes that insurance premiums are not fixed charges for personal services.

b. An insurance premium is not payment for a professional service.

The Court has not found any North Carolina law construing a payment of an insurance premium for hazard insurance as a payment for a professional service. In contrast, Chapter 75 of the North Carolina General Statutes specifically contemplates that the sale of insurance is not a professional service. Chapter 75 applies to methods, acts, and practices "in or affecting commerce," where commerce is defined as "all business activities ... but does not include professional services rendered by a member of a learned profession." § 75-1.1(a),(b). Demonstrating that insurance does not fall within the professional services exception to the statute, the North Carolina Supreme Court has held that unfair and deceptive acts in connection with the sale of insurance under § 58-63-15 constitute a per se violation of § 75-1.1. See, e.g., Pearce v. Am. Def. Life Ins. Co., 316 N.C. 461, 469, 343 S.E.2d 174, 179 (1986) (holding that a violation of the former North Carolina § 58-54.4, recodified at § 58-63-15, governing unfair and deceptive insurance practices, constitutes a violation of Chapter 75 as a matter of law); see also High Country Arts & Craft Guild v. Hartford Fire Ins. Co., 126 F.3d 629, 635 (4th Cir. 1997) (unfair insurance claims practices constitute per se proof of unfair and deceptive trade practices under § 75-1.1). Due to the statutory exclusion of professional services from the ambit of Chapter 75, the sale of insurance could not constitute a per se violation of Chapter 75 if it were a professional service. This Court therefore concludes that a servicer's expense for hazard insurance is not incurred as a charge for a professional service.

(2) The context and structure of Chapter 45 confirm that the term "fee" does not contemplate an expense for an insurance premium.

Reading Chapter 45 in pari materia,15 the North Carolina General Assembly did not intend for "fee" to include all "payments," "charges," "expenses," or "costs" that may be chargeable to a borrower under loan documents and applicable law such as hazard insurance premiums. Unlike many other sections of Chapter 45, § 45-91 refers solely to "fees" without including other "payments," "charges," "expenses," or "costs."

Throughout Chapter 45 the legislature distinguished between fees and broader categories of costs or expenses. Read as a harmonious body of legislation, the North Carolina legislature intended "fees" to be a limited subcategory of charges that may be assessed to borrowers. For example, under Article 2a of Chapter 45, the proceeds of a sale must be applied first to "[c]osts and expenses of the sale, including the trustee's commission, if any, and a reasonable auctioneer's fee, ... and reasonable counsel fees for an attorney serving as a trustee ...." N.C. Gen. Stat. § 45-21.31(a)(1) (2018) (emphasis added). Therefore, by including fees among certain costs and expenses, the legislature plainly considers fees to be a subcategory of costs and expenses.

It is equally apparent that the legislature did not intend for "fee" to be coextensive with "charge," "cost," or "expense." In fact, the legislature's inclusion of "fees" elsewhere along with these broader terms demonstrates the limitation of "fees," and the legislature particularly refers to insurance in Chapter 45 by other terms.

Article 10 specifically addresses insurance in only one instance. In § 45-92, the North Carolina General Assembly regulated the manner in which a servicer may exercise the authority to collect escrow amounts "for insurance, taxes, and other charges with respect to the property ...." (emphasis added). Thus, the only mention of insurance in Article 10 contemplates insurance as a "charge." Elsewhere in Article 10, the General Assembly indicated its intent that "fees" does not encompass all "charges" assessed by a servicer. See § 45-93(2)(b) (requiring a written statement on the request of the borrower that "identifies and itemizes all fees and charges assessed under the loan transaction") (emphasis added). If the legislature intended all "charges" to be encompassed within "fees" for purposes of Article 10, there would have been no reason to require a statement to itemize "all fees and charges" as required by § 45-93(2)(b). The General Assembly simply could have required an itemization of "all fees." See Builders, Inc. v. City of Winston-Salem, 302 N.C. 550, 556, 276 S.E.2d 443, 447 (1981) ("It is presumed that the legislature intended each portion to be given full effect and did not intend any provision to be mere surplusage").

The legislature similarly refers to insurance elsewhere in Chapter 45 without referring to insurance as a fee. In § 45-70(c), the legislature excepted from the concept of future advances those "payments made, sums advanced, and expenses incurred ... for insurance, taxes, and assessments" to protect the creditor's interest under the security instrument or to preserve and protect the value or condition of the encumbered real property. The legislature included similar language when referring to "payments made, sums advanced, and expenses incurred ... for insurance, taxes, and assessments" in connection with an equity line of credit under §§ 45-82 and 45-82.3(c)(1). Therefore, the General Assembly contemplates insurance as a "charge" in Article 10, and as "payments made, sums advanced, [or] expenses" elsewhere in Chapter 45, rather than as a "fee."

Chapter 45 contains other distinctions between "charges," "costs," "expenses," "disbursements," and "fees." Section 45-21.15 governs "Trustee's fees," and refers to such fees as compensation "for a trustee's services," without mentioning other trustee expenses or costs. Section 45-21.16(5a) requires a mortgagee or trustee that is granted a power of sale to provide notice of hearing in which the holder must confirm that "within 30 days of the date of the notice, the debtor was sent by first-class mail at the debtor's last known address a detailed written statement of the amount of principal, interest, and any other fees, expenses and disbursements that the holder in good faith is claiming to be due ...." (emphasis added). As in §§ 45-70, 45-82, and 45-82.3(c)(1), if all such expenses and disbursements that are chargeable to the borrower constitute "fees," there would be no need for the latter categories of "expenses" and "disbursements" to be listed in this section.

Reading Chapter 45 as a whole, where the North Carolina General Assembly intended to legislate with respect to broader categories of expenses, charges, costs, or payments, it did so by specifically listing these broader categories within the statute. Tellingly, the legislature did not do so in § 45-91, which solely refers to "fees." Construing these statutes in pari materia, the Court concludes that an expense incurred by a servicer for hazard insurance is not the type of charge intended by the North Carolina legislature to constitute a "fee" under § 45-91.

B. A servicer may file a notice of postpetition fees, expenses, or charges as an undisputed authorized agent of the holder.

Debtor asserts that because the Postpetition Notice was filed by Ditech, rather than the holder, U.S. Bank, the notice should be disallowed under Rule 3002.1. Debtor does not dispute that U.S Bank, as Trustee, as successor to Firstar Trust Company as Trustee, for Manufactured Housing Contract Senior/Subordinate Pass-Through Certificate Trust 1996-3 is the holder of the loan, see Claim No. 2 at 4, 34, and Debtor has not objected to U.S. Bank's proof of claim. See 11 U.S.C. § 502 ("[a] claim ..., proof of which is timely filed ..., is deemed allowed unless a party in interest ... objects"). Debtor does not dispute that Ditech is the servicer of the loan, nor does Debtor challenge the efficacy of the U.S. Bank Power of Attorney. The Postpetition Notice specifically refers to Claim No. 2, and Debtor has not asserted that there was any confusion caused when the servicer filed and served the Postpetition Notice on behalf of U.S. Bank as the holder. Instead, without citing any authority, Debtor contends that the Postpetition Notice is defective because it was not signed by U.S. Bank and does not refer to U.S. Bank as the holder. Debtor's position lacks merit.

Bankruptcy Rule 3001 governs who may file claims. Under Rule 3001, a proof of claim may be executed by the creditor16 or the creditor's authorized agent. Fed. R. Bankr. P. 3001(b).17 Not only is there no dispute that Ditech, as servicer, is an authorized agent of U.S. Bank, but Ditech itself also was authorized to file a claim. "A servicer of a mortgage is clearly a creditor and has standing to file a proof of claim against a debtor pursuant to its duties as a servicer." In re Conde-Dedonato, 391 B.R. 247, 250 (Bankr. E.D.N.Y. 2008) (and cases cited therein)). Therefore, the Debtor's objection based on Ditech filing the Postpetition Notice is overruled.

IT IS THEREFORE ORDERED, ADJUDGED, and DECREED that the Objection is overruled.

SO ORDERED.