HIGHLIGHTS: Steinberger v Hon. McVey/OneWest
¶95 However, Count Eleven also alleges that part of the loan has already been paid by the FDIC under a “Shared-Loss Agreement,” and Steinberger attached a copy of a Shared-Loss Agreement to the complaint. While it is not clear whether this agreement in fact applies to Steinberger’s loan, the agreement does appear to provide that, in exchange for OneWest’s assumption of IndyMac Federal’s loans, the FDIC would reimburse OneWest at 80% for any default in payments on those loans. Steinberger alleges that this agreement, combined with insurance coverage and/or other sources of reimbursement “has on information and belief resulted in OneWest’s either being paid in full for the Note, or having received at least 80% of the payments due on the Note.”
¶96 While the alleged insurance payments are indeed speculative and unsupported, the assertion that the FDIC has already reimbursed OneWest for Steinberger’s default is not unsupported, based on the fact the Shared-Loss Agreement does appear to authorize such reimbursement. Under A.R.S. § 47-3602, “an instrument is paid to the extent payment is made by or on behalf of a party obliged to pay the instrument and to a person entitled to enforce the instrument.” Thus, if it is true that the FDIC has already reimbursed OneWest for all or part of Steinberger’s default, OneWest may not be entitled to recover that amount from Steinberger.
Discharge of Debt —
money that OneWest received from FDIC to pay off loss on loan discharges
the debt. If it is true that the FDIC has already reimbursed OneWest
for all or part of [the borrower's] default, OneWest may not be entitled
to recover that amount from [the borrower}. This corroborates what
we have been writing in this blog regarding third-party payments and the
existence of co-obligors. To the extent that third party payments have
been received by the creditor this court is saying that nobody can
collect those same payments from the borrower.
Unconscionability: Procedural and Substantive:
Unfair surprise and fairness, respectively, are the main elements. This
opinion raises the possibility of bringing claims that might have been
barred by the TILA Statute of Limitations. Pleading requirements are
strict. But if you read the decision you can tell that there is room for
borrowers to oppose enforcement of contracts that produced sticker
shock and other unfair surprises.
Quiet title: This
Court concluded that you can’t quiet title based upon the weakness of
someone else’s claim. You must allege your right to title and that the
parties served have no claim.
Negligence Per Se:
Opening a whole new area for litigation this Court concluded that
negligence and negligence per se, were valid causes of action for
damages and other relief in connection with the handling of modification
and other requests. . . . .
READ MORE AT Arizona Appeals Court Reverses Direction: Dismissal of Borrower’s Claims Reversed | Livinglies's Weblog