United States District Court, D. Montana, Butte Division
Jeremiah C. Lynch United States Magistrate Judge
the Court is Defendant CitiMortgage, Inc.'s
(“Citi”) Fed.R.Civ.P. 56 motion for summary
judgment dismissing Plaintiff Jonathan Bertelsen's
claims. For the reasons discussed, the Court deems it
appropriate to grant the motion.
time prior to 2003 Plaintiff Jonathan Bertelsen purchased a
residence in Bozeman, Montana. He and his sons lived in the
Bertelsen refinanced his residential real property because
interest rates had gone down. He obtained a new loan in the
amount of $305, 000 memorialized in a promissory note and
secured by a deed of trust pledging his real property.
Thereafter, Citi serviced Bertelsen's loan on behalf of
original lender was ABN AMRO Mortgage Group, Inc.
(“AMRO”). But in 2007, AMRO merged into Citi.
Bertelsen experienced financial difficulties due to a
reduction in his income. As a result he defaulted on his loan
obligations - falling about 60 days behind in making his loan
payments. At that point Bertelsen reached out to Citi for
loan assistance, but Citi informed him it could not discuss
options for assistance until he was in default for 90 days.
next five years Bertelsen submitted applications for loan
modifications or assistance programs to Citi. He worked with
Citi to provide information and documentation it requested to
support his applications. During that time frame, Citi would
review his applications, request additional documents, deny
his applications for various programs, but then invite him to
again apply for a modification or a loan assistance program.
This cycle repeated several times over the years. And
although Citi told Bertelsen it was considering his
applications, it also referred his account for foreclosure
several times and set numerous foreclosure sale dates.
or 2010 Bertelsen attempted to make additional payments to
Citi on his loan, but they were returned to him. Citi points
out, however, the deed of trust permitted it to reject
payments if they are insufficient to bring the loan
obligations current. He has not tried to make any further
payments since 2010.
December 8, 2011, Bertelsen filed a petition for Chapter 13
bankruptcy relief. The petition was dismissed in October
2013. Thereafter, Bertelsen continued to work with Citi in an
attempt to secure a modification of his loan payment
obligations. For two more years Bertelsen submitted further
information and documents as requested by Citi. During that
same time frame Citi again scheduled foreclosure sales of the
property which were ultimately cancelled. Citi informed
Bertelsen he owed attorneys' fees, loan servicing fees
and expenses as a result of the default and foreclosure
Citi invited Bertelsen to apply for various loan
modifications or assistance programs, ultimately Citi decided
Bertelsen was not eligible for such programs. Citi never
granted Bertelsen a loan modification, but it also has never
pursued foreclosure to completion.
alleges all of Citi's recurring conduct - inviting him to
apply for loan modifications, but then rejecting his
applications - caused him to suffer damages including lost
time, lost income, lost money, incidental expenses and
emotional distress. And he alleges he will suffer irreparable
harm if his home is sold while this case is pending.
advances numerous claims for relief under Montana law: (1)
violations of the Montana Consumer Protection Act, (2)
negligence, (3) tortious bad faith, (4) breach of contract,
(5) constructive fraud, and (6) punitive damages. He also
requests declaratory and injunctive relief barring any
foreclosure sale of his property.
Citi's motion to dismiss, the Court entered an order on
June 14, 2016, dismissing Bertelsen's claim of
negligence, his claims under the Montana Consumer Protection
Act, and his claim for breach of contract predicated upon
Citi's alleged unreasonable inspections of the property.
Also, the Court concluded Bertelsen is judicially estopped
from asserting claims that accrued before his bankruptcy
petition was dismissed on October 1, 2013. Thus the claims
that remain are only those which Bertelsen can demonstrate
accrued after October 1, 2013.
subsequently moved for leave to seek reconsideration of the
Court's dismissal of the Montana Consumer Protection Act
claim. The Court granted him leave to do so, and he filed his
motion for reconsideration of that claim. The Court has
denied that motion.
meantime, Citi has moved for summary judgment on each of
Bertelsen's remaining claims for relief.
Rule 56 Motion for Summary Judgment
Rule of Civil Procedure 56(a) entitles a party to summary
judgment “if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” A movant may satisfy this
burden where the documentary evidence produced by the parties
permits only one conclusion. Anderson v. Liberty Lobby
Inc., 477 U.S. 242, 251 (1986). Once the moving party
has satisfied his burden, he is entitled to summary judgment
if the non-moving party fails to designate by affidavits,
depositions, answers to interrogatories, or admissions on
file, “specific facts showing that there is a genuine
issue for trial.” Celotex Corp. v. Cattrett,
477 U.S. 317, 324 (1986). In deciding a motion for summary
judgment, the Court views the evidence in the light most
favorable to the non-moving party and draws all justifiable
inferences in the non-moving party's favor. Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986);
Betz v. Trainer Wortham & Co., Inc., 504 F.3d
1017, 1020-21 (9th Cir. 2007).
Application of Montana Law
diversity action, the Court applies the substantive law of
Montana, the forum state. Medical Laboratory Mgmt.
Consultants v. American Broadcasting Companies,
Inc., 306 F.3d 806, 812 (9th Cir. 2002).