United States District Court, D. Hawaii
(1) DISMISSING CLAIMS AGAINST PNC MORTGAGE; (2) GRANTING
SUMMARY JUDGMENT IN FAVOR OF THE PNC FINANCIAL SERVICES
GROUP, INC.; (3) GRANTING SUMMARY JUDGMENT IN FAVOR OF PNC
BANK N.A. WITH RESPECT TO THE FAIR DEBT COLLECTION PRACTICES
ACT CLAIM ASSERTED IN COUNT TWO AND THE TELEPHONE CONSUMER
PROTECTION ACT CLAIM ASSERTED IN COUNT FOUR; AND (4) GRANTING
SUMMARY JUDGMENT IN FAVOR OF ANNETTE AUGUST IN WITH RESPECT
TO LIABILITY FOR THE BREACH OF CONTRACT CLAIM ASSERTED IN
COUNT ONE AND WITH RESPECT TO THE SECTION 480-2 CLAIM
ASSERTED IN COUNT THREE
OKI MOLLWAY, UNITED STATES DISTRICT JUDGE
Plaintiff Annette Agustin's second case before this court
involving the same residential mortgage loan. In March 2009,
she stopped sending payments to Defendant PNC Bank N.A., the
loan servicer. Agustin sued PNC Bank N.A. and others over the
loan. In June 2011, the parties settled that case, with
Agustin agreeing to vacate and surrender the mortgaged
property and not to oppose the foreclosure of the mortgage.
In return, the settlement agreement required PNC Bank to pay
Agustin $5, 000 and to refrain from seeking any deficiency
judgment and to release all claims and demands with respect
to Agustin's loan. Notwithstanding the settlement
agreement, PNC Bank or PNC Mortgage (a division of PNC Bank)
continued to send Agustin monthly statements and other
correspondence demanding payment, reflecting past due amounts
ranging from over $90, 000 to over $135, 000. PNC Bank also
called Agustin more than 100 times with respect to the loan.
wrote to PNC Mortgage in October 2014, referring to the
settlement. In November 2014, PNC Mortgage conceded that its
records reflected the settlement and that she “no
longer ha[d] personal liability for either the debt or for
the property.” PNC Mortgage said it was working
diligently to update its system to prevent further
communication about the loan, but noted that she might still
receive information regarding the loan. The correspondence
and calls demanding payment continued.
now sues PNC Bank and PNC Mortgage for having made numerous
attempts to collect a debt she no longer owed. She also sues
The PNC Financial Services Group, Inc., asserting that it is
vicariously liable for conduct by PNC Bank and PNC Mortgage.
In the First Amended Complaint of September 21, 2017, Agustin
asserts claims of breach of the settlement agreement (Count
One), violation of the Fair Debt Collection Practices Act
(“FDCPA”) (Count Two), violation of section 480-2
of Hawaii Revised Statutes (“UDAP”) (Count
Three), and violation of the Telephone Consumer Protection
Act (Count Four).
move for summary judgment with respect to all counts. See ECF
No. 71. Agustin separately moves for summary judgment with
respect to the breach of contract and UDAP claims asserted in
Counts One and Three. See ECF No. 74. The court dismisses the
claims against PNC Mortgage, which Agustin recognizes is not
a legal entity separate from PNC Bank. The court grants
summary judgment in favor of The PNC Financial Services
Group, Inc., with respect to all claims asserted in the First
Amended Complaint, as Augustin concedes that she cannot
establish any liability on its part. Without objection by
Augustin, the court grants summary judgment in favor of PNC
Bank with respect to the FDCPA and Telephone Consumer
Protection Act claims asserted in Counts Two and Four of the
First Amended Complaint. However, the court grants summary
judgment in favor of Agustin and against PNC Bank with
respect to the breach of contract and UDAP claims asserted in
Counts One and Three of the First Amended Complaint. The
court leaves for further adjudication the issue of damages
resulting from the breach of contract. The court awards
statutory damages of $1, 000 to Agustin for the UDAP claim,
as well as her reasonable attorney's fees and costs.
case arises out of a $278, 400 loan that Plaintiff Annette
Agustin and her then-husband, George Agustin, obtained in
February 2007 from National City Mortgage. The Agustins
executed an Adjustable Rate Note and a Mortgage to secure the
loan. See ECF Nos. 73-3 and 73-4. On May 18, 2012,
PNC Bank, successor by merger to National City Bank, assigned
the loan to HSBC Bank USA, National Association as Trustee
for Luminent Mortgage Trust 2007-2. See ECF No.
73-5. PNC Bank and PNC Mortgage, a division of PNC Bank,
continued to service the loan. See Corporate
Disclosure Statement, ECF No. 19 (“PNC Mortgage is not
a legal entity. It is a division of PNC Bank N.A.”).
Agustins stopped paying on their loan in March 2009. In
September 2009, the Agustins sued The PNC Financial Services
Group, Inc., and others, seeking rescission of their loan,
recoupment, injunctive relief, and damages under the Truth in
Lending Act, Real Estate Settlement Procedures Act, and
Hawaii law. See Complaint, Agustin v. PNC Fin.
Serv. Group, Inc., Civ. No. 09-00423 SOM/KSC, ECF No. 1.
On February 23, 2010, PNC Bank, N.A., filed a Corporate
Disclosure Statement, indicating that it, not The PNC
Financial Services Group, Inc., was the proper defendant.
See Civ. No. 09-00423 SOM/KSC, ECF No. 12.
2011, PNC Bank and Agustin settled the earlier case.
See Settlement Agreement, Waiver, and Mutual
Release, ECF No. 100. In relevant part, Agustin agreed to
vacate and surrender the mortgaged property to PNC Bank no
later than May 18, 2018. Id., PageID # 2753. The
settlement agreement allowed PNC Bank to foreclose on the
mortgage and barred Agustin from opposing foreclosure
proceedings. Id., PageID # 2737. In return, PNC Bank
agreed to pay Agustin $5, 000 and agreed not to seek any
deficiency judgment. Id., PageID #s 2737 and 2754.
PNC Bank also agreed that it would
absolutely and unconditionally release the AGUSTINS . . .
from any and all claims, demands, actions or causes of
action, of whatever nature or description, known or unknown,
now existing or hereafter acquired, and whether or not
asserted in the Litigation, which the PNC Releasors ever had,
now have, or may hereafter acquire against the AGUSTIN
Releasees, arising out of or related in any manner to conduct
of the AGUSTIN Releasees regarding the First Note and First
Mortgage arising after the date of this Agreement, except for
the obligations of the AGUSTINS under the terms and
conditions of this Agreement.
Id., PageID # 2738.
purposes of these motions, there is no dispute that Agustin
complied with her obligations under the settlement agreement.
Despite her compliance, PNC Mortgage, as loan servicer,
continued to send Agustin monthly statements that demanded
payment. For example, a statement dated August 18, 2014,
indicated that Agustin owed $91, 152.90, which included
interest, an escrow payment for taxes and insurance, new fees
and charges, an overdue payment amount, late fees, and other
fees. See, e.g., ECF No. 73-6. On August
21, 2014, PNC Mortgage sent Agustin a letter saying,
“We understand that borrowers sometimes face challenges
when it comes to making their payments.” ECF No. 73-7,
PageID # 1601. The letter included the heading
“Delinquency Notice Information, ” underneath
which the letter stated, “Our records show that
mortgage payments of $87, 588.89, plus late charges and other
fees and costs of $10, 159.10 for a total of $97, 747.99
January 16, 2019are due . . . . Please note that if you do
not make these payments by the late charges assessment date,
an additional late fee may be added to your account.”
about October 5, 2014, Agustin sent a letter to PNC Mortgage
disputing the debt. She told PNC Mortgage that she did not
owe anything because “this matter has already been
settle[d] in court. Please see the attached documentation
that provides a more detailed breakdown of the court
settlement.” ECF No. 74-3, PageID # 1704.
about November 10, 2014, PNC Mortgage responded to the
October 5, 2014, letter, stating:
Our records indicate that you entered into a Settlement
Agreement with PNC. We have updated the account to reflect
that you no longer have personal liability for either the
debt or for the property.
On November 6, 2014, we updated the credit reporting showing
a full settlement as of May 2011.
PNC is working diligently to update our system to prevent any
further communication . . . to you. However, you may continue
to receive information about the foreclosure.
We trust that this response will resolve your concerns.
74-4, PageID # 1709. PNC Mortgage's system was updated on
November 6, 2014, to say, “THIS IS A LITIGATED LOAN,
AND PER THE TERMS OF THE SETTLEMENT, THE LOAN IS BEING
REPORTED AS SATISFIED IN FULL EFFECTIVE 5/11/11.” ECF
No. 74-5, PageID # 1711. At no time, however, did PNC
Mortgage update its standard delinquency letters, monthly
statements, or other correspondence, to reflect that Agustin
did not actually have to pay any of the amounts PNC Mortgage
PNC Bank now says it was required by federal law to send
Agustin “information” about her loan obligations,
the “information” it sent never acknowledged that
PNC Bank was not actually seeking the money from Agustin that
the letters kept saying she owed. For example, on November
17, 2014, a week after acknowledging that Agustin had no
further liability with respect to the loan, PNC Mortgage sent
Agustin a letter that enclosed a one-year hazard insurance
policy at a cost of $2, 359.00 that it charged to
Agustin's loan account. See ECF No. 73-8.
Mortgage also continued to send Agustin letters noting,
“We understand borrowers sometimes face challenges when
it comes to making their payments. . . . please call us to
discuss your current loan status. We want to help you explore
options to bring your account current and find the best
possible solution to resolve any financial hardship. . . .
This is an attempt to collect a debt and/or enforce our
lien.” ECF No. 98-3, PageID #s 2610-2639 (letters dated
from Nov. 11, 2014, through June 13, 2017). Letters continued
to threaten additional late fees. ECF No. 98-4, PageID #s
2630-2710 (letters dated from July 10, 2015, through Oct. 10,
statement listed a “Payment Amount Due, ”
“Total Amount Due, ” and “Payment Due
Date.” The statements also reflected a past due amount
ranging from over $90, 000 to over $135, 000. See
ECF No. 98-2. In other words, PNC Mortgage continued to
demand payment, even after PNC Mortgage's November 2014
acknowledgment that the loan had been deemed
“satisfied” as of May 2011. Beginning in ...