Anthony Maluski v. US Bank NA

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
October 22, 2009
No. 09-20132 Charles R. Fulbruge III
Summary Calendar Clerk
ANTHONY E MALUSKI,
Plaintiff-Appellant
v.
US BANK NA, as Trustee, successor by merger to Firstar Bank NA, successor
in interest to Firstar Bank Milwaukee NA, as trustee for Salomon Brothers
Mortgage Securities VII, Inc Floating Rate Mortgage Pass-Through
Certificates Series 1999-NC4,
Defendant-Appellee
PROPERTY ASSET MANAGEMENT, INC.,
Intervenor Plaintiff - Appellee
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:07-CV-55
Before REAVLEY, DAVIS, and HAYNES, Circuit Judges.
PER CURIAM:*
*
Pursuant to 5TH CIR . R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR .
R. 47.5.4.
No. 09-20132
Anthony E. Maluski appeals the district court’s grant of summary
judgment in favor of the appellees. Maluski sued U.S. Bank NA, alleging that
a promissory note and lien securing a home equity loan were void and
unenforceable under the Texas state constitution. U.S. Bank removed the suit
to federal court on diversity grounds and subsequently assigned its interest in
the note to Property Asset Management Inc. (PAMI), which then intervened.
PAMI asserted a claim against Maluski for breach of contract and judicial
foreclosure due to Maluski’s default on the note. We AFFIRM.
Maluski argues that PAMI lacks standing to assert a claim under the note
because the note was a negotiable instrument that was not properly transferred
to PAMI. The note itself specifically provides that “the Lender may transfer this
Note.” The summary judgment evidence documents the assignment of the note
from the original lender to U.S. Bank and from U.S. Bank to PAMI. U.S. Bank
assigned its interest in the note to PAMI through a transfer of lien that was
recorded on the land records. The evidence was sufficient to establish PAMI’s
standing. See Dade v. Hoover, 191 S.W.3d 886, 888 (Tex. App. 2006); Vernor v.
Southwest Fed. Land Bank Ass’n, FLCA, 77 S.W.3d 364, 366 (Tex. App. 2002).
Maluski further contends that the note he signed is unenforceable and
that the lender must forfeit all principal and interest thereon because the fees
that he was charged in connection with the loan violated the state constitution.
The Texas state constitution limits the amount of certain fees that lenders may
charge borrowers in connection with home equity loans. See T EX . C ONST. art.
XVI, § 50(a)(6). It specifically provides that lenders
[may] not require the owner or the owner’s spouse to pay, in
addition to any interest, fees to any person that are necessary to
originate, evaluate, maintain, record, insure, or service the
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No. 09-20132
extension of credit that exceed, in the aggregate, three percent of
the original principal amount of the extension of credit.
Id.
Maluski argues he was charged fees exceeding three percent of his loan
principal, which was $116,250. The HUD-1 statement shows $5,557.95 in fees
that were subject to the three percent cap. It also shows, however, that Maluski
was given a closing cost credit of $2,070.45, meaning that the total fees were
actually $3,487.50, exactly three percent of the principal amount. Maluski
argues that U.S. Bank admitted that it lacked evidence of how the credit was
applied, and he speculates that a portion of the credit could have been applied
to interest points charged at closing, which were not subject to the three percent
cap. We are unpersuaded. The settlement statement clearly shows that
Maluski was not actually charged fees of more than three percent of the
principal loan. His unsubstantiated argument of how the credit theoretically
could have been manipulated is insufficient to defeat summary judgment. See
Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc).
Maluski also argues that he was charged fees in excess of the three percent
cap because the HUD-1 statement reflects that a yield spread premium was paid
outside of closing by the lender to the mortgage broker. He contends this fee was
ultimately passed on to him. We agree with the district court’s assessment of
this claim. Interpretation of the Texas state constitution requires that “we rely
heavily on its literal text and [we] must give effect to its plain language.” Doody
v. Ameriquest Mortgage Co., 49 S.W.3d 342, 344 (Tex. 2001). The literal text of
the Texas constitution protects the “owner or the owner’s spouse” from paying
the prohibited fees. T EX. C ONST. art. XVI, § 50(a)(6). Here, the HUD-1
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No. 09-20132
statement reflects that the lender paid the yield spread premium to the broker,
not Maluski. Although the lender may ultimately recoup the payment due to
Maluski paying a higher interest rate over the life of the loan, this indirect
payment is not contemplated by a plain reading of the state constitution. Cf.
Bjustrom v. Trust One Mortgage Corp., 322 F.3d 1201, 1205 (9th Cir. 2003) (yield
spread premium paid by lender to broker was not “‘collect[ed] from the
mortgagor,’” and a plain reading of Federal Housing Administration regulation
that limited the mortgagee’s fees to one percent of the principal amount covered
fees collected directly, not indirectly, from the mortgagor) (citation omitted).
AFFIRMED.
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