Kimberly Covarrubias v. Citimortgage, Inc.

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 14-2420
KIMBERLY COVARRUBIAS,
Plaintiff - Appellant,
v.
CITIMORTGAGE, INC.,
Defendant - Appellee.
Appeal from the United States District Court for the Eastern
District of Virginia, at Richmond. John A. Gibney, Jr.,
District Judge. (3:14-cv-00157-JAG)
Submitted: August 20, 2015 Decided: September 1, 2015
Before KING, KEENAN, and WYNN, Circuit Judges.
Affirmed in part, vacated in part, and remanded by unpublished
per curiam opinion.
Henry W. McLaughlin, III, LAW OFFICE OF HENRY MCLAUGHLIN, P.C.,
Richmond, Virginia, for Appellant. Anand V. Ramana, Elizabeth
H. Goodall, MCGUIREWOODS LLP, Washington, D.C., for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Kimberly Covarrubias appeals the district court’s orders
granting summary judgment and judgment on the pleadings in favor
of CitiMortgage, Inc. (“CMI”) and dismissing the case with
prejudice. In November 2011, CMI foreclosed on Covarrubias’
home after she defaulted on the mortgage. Covarrubias’ lawsuit
asserted that CMI improperly foreclosed by failing to comply
with U.S. Department of Housing and Urban Development
regulations (“HUD regulations”) incorporated into the deed of
trust, and committed actual fraud by foreclosing shortly after a
CMI representative assured her that foreclosure would be
deferred. On appeal, Covarrubias contends that the district
court erred in determining that CMI’s breach of HUD regulations
did not result in her claimed damages (Count One), and that
Covarrubias failed to support her fraud claim (Count Three). ∗ We
affirm in part and vacate in part.
We review a grant of summary judgment de novo, construing
the evidence in the light most favorable to the nonmoving party.
Walker v. Mod-U-Kraf Homes, LLC, 775 F.3d 202, 207 (4th Cir.
2014). “The court shall grant summary judgment if the movant
∗Covarrubias disclaims any challenge to the district
court’s other dispositive holdings, which accordingly are
abandoned on appeal. Fed. R. App. P. 28(a)(8)(A); Edwards v.
City of Goldsboro, 178 F.3d 231, 241 n.6 (4th Cir. 1999).
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shows that there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.”
Fed. R. Civ. P. 56(a). The relevant inquiry in a summary
judgment analysis, then, is “whether the evidence presents a
sufficient disagreement to require submission to a jury or
whether it is so one-sided that one party must prevail as a
matter of law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
251-52 (1986). “Where the record taken as a whole could not
lead a rational trier of fact to find for the non-moving party,
there is no genuine issue for trial.” Matsushita Elec. Indus.
Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (internal
quotation marks omitted).
“The nonmoving party cannot create a genuine issue of
material fact through mere speculation or the building of one
inference upon another,” Othentec Ltd. v. Phelan, 526 F.3d 135,
140 (4th Cir. 2008) (internal quotation marks omitted), and
“cannot defeat summary judgment with merely a scintilla of
evidence,” Am. Arms Int’l v. Herbert, 563 F.3d 78, 82 (4th Cir.
2009). In our review of summary judgment, we do not weigh the
evidence or make credibility determinations. Williams v.
Staples, Inc., 372 F.3d 662, 667 (4th Cir. 2004). We will
uphold a grant of summary judgment unless we find that a
reasonable jury could return a verdict for the nonmoving party
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on the evidence presented. EEOC v. Cent. Wholesalers, Inc., 573
F.3d 167, 174-75 (4th Cir. 2009).
I.
To prevail on a breach of contract claim under Virginia
law, a plaintiff must show that: (1) the defendant owed her a
legally enforceable obligation; (2) the defendant violated that
obligation; and (3) she suffered injury or damage as a result of
the defendant’s breach. Filak v. George, 594 S.E.2d 610, 619
(Va. 2004). The plaintiff bears the burden of establishing the
causal link between the alleged breach and damages claimed.
Saks Fifth Ave., Inc. v. James, Ltd., 630 S.E.2d 304, 311 (Va.
2006).
Virginia courts construe deeds of trust as contracts.
Mathews v. PHH Mortg. Corp., 724 S.E.2d 196, 200 (Va. 2012).
Accordingly, lenders “must comply with all conditions precedent
to foreclosure in a deed of trust even if the borrowers are in
arrears.” Id. at 199. Where the deed of trust requires
compliance with incorporated HUD regulations, “the face-to-face
meeting requirement [of 24 C.F.R. § 203.604(b) (2015)] is a
condition precedent to the accrual of the rights of acceleration
and foreclosure.” Id. at 202.
Here, CMI was obligated under HUD regulations to conduct,
or make a reasonable effort to conduct, a face-to-face meeting
prior to foreclosure. The record reveals CMI failed to do so.
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The record also reveals Covarrubias presented prima facie
evidence of causation. She produced evidence demonstrating a
willingness and ability to bring the mortgage current had CMI
arranged a face-to-face meeting, and sufficiently showed a loss
of equity as a direct result of the foreclosure. Thus,
construing the evidence in the light most favorable to
Covarrubias, we conclude that a rational jury could reasonably
conclude that a face-to-face meeting, as required, may have
resulted in an outcome other than foreclosure and the consequent
loss of Covarrubias’ equity.
II.
Covarrubias next challenges the district court’s dismissal
of her actual fraud claim. To prevail, Covarrubias must
demonstrate that she relied on an intentional or knowing
misrepresentation by CMI and suffered harm by such reliance.
Weidman v. Exxon Mobil Corp., 776 F.3d 214, 219 (4th Cir.),
cert. denied, 135 S. Ct. 2868 (2015); Station #2, LLC v. Lynch,
695 S.E.2d 537, 540 (Va. 2010). A misrepresentation occurs if
the party “makes a promise that, when made, [it] has no
intention of performing.” Station #2, LLC, 695 S.E.2d at 540
(internal quotation marks omitted). Covarrubias bears the
burden of proving each element “by clear and convincing
evidence.” Richmond Metro. Auth. v. McDevitt St. Bovis, Inc.,
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507 S.E.2d 344, 346 (Va. 1998). We discern no error by the
district court.
Accordingly, we vacate the district court’s order granting
summary judgment in CMI’s favor as to Covarrubias’ breach of
contract claim involving the requirements to offer or conduct a
face-to-face meeting and remand for further proceedings
consistent with this opinion. We affirm in all other respects.
We dispense with oral argument because the facts and legal
contentions are adequately presented in the materials before
this court and argument would not aid the decisional process.
AFFIRMED IN PART;
VACATED IN PART;
AND REMANDED
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