Subscriber Benefit
As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe Now
A debt collector working on behalf of a bank did not satisfy the federal face-to-face meeting requirements required for foreclosure on a Lafayette residence, the Indiana Court of Appeals ruled Friday in affirming a lower court’s judgment in favor of the property’s owner.
According to court records, in September 2008, Edward Gaeta executed a promissory note payable to The Huntington National Bank in the principal amount of $78,859.
The loan was secured via a mortgage against his Lafayette residence and insured by the Federal Housing Administration, thereby subjecting the note and mortgage to federal Department of Housing and Urban Development regulations. Gaeta failed to make a timely payment and instead made sporadic payments for the next few months.
In September 2014, after his active service in the Marines ended, Gaeta began living at the residence again but did not make consistent payments.
In November 2015, Mercer Belanger filed a complaint on note and to foreclose mortgage in Tippecanoe Circuit Court. Gaeta filed his own complaint against Mercer, alleging that it violated the Fair Debt Collection Practices Act.
Both parties moved for summary judgment. The case was moved to the Indiana Northern District, where that court found it did not have jurisdiction and remanded back to the Tippecanoe County court.
The trial court granted the motions in part and denied them in part and ultimately ruled that Mercer violated the FDCPA.
A jury assessed actual and statutory damages for Gaeta. The trial court awarded additional fees and expenses, with the court’s final judgment in favor of Gaeta in the amount of $463,130.
That judgment included an original $331,000, plus $132,130 for attorney fees, paralegal fees, expenses, and foreclosure defense attorney fees.
Mercer appealed the judgment.
In affirming the judgment, the appellate court found Gaeta met the requirements for standing at summary judgment.
It also ruled that Mercer has not convinced the court that the trial court erred in granting partial summary judgment in Gaeta’s favor.
The appellate court noted that because a face-to-face meeting requirement is a condition precedent to the foreclosure process, and Huntington “clearly did not comply with the explicit requirements of 24 C.F.R. § 203.604[,]” foreclosure was an action that could not legally be taken against Gaeta.
“Mercer did not merely threaten foreclosure, an action which could not be legally taken, but pursued foreclosure against Gaeta beginning in 2015 and continuing for years. Mercer did so after email communications with Huntington (designated by Gaeta) wherein Huntington indicated its noncompliance and its request to dismiss,” the appellate court stated in its opinion.
The case is Mercer Belanger Professional Corporation v. Edward Gaeta , 23A-CT-1351.
Please enable JavaScript to view this content.