Linda Castellucci v. Jpmorgan Chase Bank, N.A. ( 2021 )


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  •                            NOT FOR PUBLICATION                           FILED
    UNITED STATES COURT OF APPEALS                        OCT 8 2021
    MOLLY C. DWYER, CLERK
    U.S. COURT OF APPEALS
    FOR THE NINTH CIRCUIT
    LINDA CASTELLUCCI, an individual,               No.    20-55852
    Plaintiff-Appellant,            D.C. No.
    2:20-cv-04580-AB-KS
    v.
    JPMORGAN CHASE BANK, N.A.,                      MEMORANDUM*
    Defendant-Appellee.
    Appeal from the United States District Court
    for the Central District of California
    Andre Birotte, Jr., District Judge, Presiding
    Submitted October 6, 2021**
    San Francisco, California
    Before: THOMAS, Chief Judge, and HAWKINS and FRIEDLAND, Circuit
    Judges.
    Linda Castellucci appeals from an order dismissing her claims against
    JPMorgan Chase Bank (“Chase”) relating to Chase’s failure to consider her
    application for a loan modification. We have jurisdiction pursuant to 28 U.S.C.
    *
    This disposition is not appropriate for publication and is not precedent
    except as provided by Ninth Circuit Rule 36-3.
    **
    The panel unanimously concludes this case is suitable for decision
    without oral argument. See Fed. R. App. P. 34(a)(2).
    § 1291, and we affirm.
    Castellucci has lived at 5740 Kanan Dume Road in Malibu, California, since
    she and her husband built a home there in 1979. In 2007, Castellucci refinanced
    and obtained a $3.75 million mortgage loan secured by the property. But for the
    last eight years, Castellucci has not kept up with her loan payments, and instead
    she has repeatedly sued Chase, the loan servicer, for claims relating to Chase’s
    purported failure to modify the loan. Castellucci’s first lawsuit against Chase, filed
    in 2016, concluded in a settlement agreement between the parties, under which
    Chase agreed to modify Castellucci’s loan (with a new principal balance of $4.68
    million) and provide her a one-time cash payment of $2,500 in exchange for
    dismissal and release of all claims. But Castellucci apparently failed to make
    timely payments under the modified loan, and Chase informed Castellucci that the
    home would be sold at a foreclosure sale in January 2020. To stave off
    foreclosure, Castellucci brought a second lawsuit in 2019, alleging identical state
    law claims as in her first lawsuit. The parties resolved this second lawsuit in a
    second settlement agreement (the “2020 Settlement Agreement”). In this new
    agreement, Castellucci and her husband acknowledged that they were in default
    under the modified loan, waived any right to challenge the foreclosure process or
    pursue further loss mitigation options, and agreed to vacate the property by April
    22, 2020. In exchange, Chase agreed to delay the foreclose sale and pay the couple
    2
    $35,000. Despite this agreement, Castellucci and her husband did not vacate the
    property, nor did they stop pursuing alternatives to foreclosure.
    Instead, two months after signing the 2020 Settlement Agreement,
    Castellucci submitted a new application for a loan modification premised on a
    purported material change in her financial circumstances.1 When Chase refused to
    consider her application, Castellucci filed this third lawsuit, which Chase removed
    to federal court. Castellucci asserts claims under California’s Homeowner Bill of
    Rights, 
    Cal. Civ. Code §§ 2923.4
     et seq., California’s Unfair Competition Law,
    
    Cal. Bus. & Prof. Code §§ 17200
     et seq., negligence, and financial elder abuse,
    
    Cal. Welf. & Inst. Code § 15610.30
    (a)(1), all stemming from Chase’s failure to
    consider her latest loan modification application. The district court dismissed all
    her claims with prejudice, concluding that Castellucci waived her right to pursue a
    further loan modification by entering into the 2020 Settlement Agreement.
    Castellucci contends on appeal that she is not bound by the 2020 Settlement
    Agreement because Chase failed to perform a condition precedent in the contract—
    namely, paying her $35,000. According to Castellucci, payment was required to
    trigger her obligations under the agreement, including her obligations to vacate the
    1
    Castellucci claimed that her monthly income had increased from $25,000
    to $35,000 and that her cash reserves had increased from approximately $100,000
    to $778,000. She argued that, instead of foreclosing, Chase should reevaluate
    whether she would qualify for a loan modification in light of her improved
    financial circumstances.
    3
    premises and refrain from seeking further loan modifications. Castellucci also
    references a provision in the agreement that provides instructions on who to
    contact in the event that Castellucci or her husband breached the agreement to
    argue that “it was built into the agreement that Appellant could still seek loss
    mitigation options.”
    Reviewing de novo, Fields v. Twitter, Inc., 
    881 F.3d 739
    , 743 (9th Cir.
    2018), we reject Castellucci’s strained interpretation of the 2020 Settlement
    Agreement. Section 4.5 of the Settlement Agreement provides:
    Customer expressly agrees and acknowledges that entering into this
    Agreement and accepting the Payment is in lieu of any and all loss
    mitigation options, including, without limitation, home retention, deed
    in lieu of foreclosure, short sale, or short payoff with respect to the
    Subject Property and Subject Loan. To the fullest extent permitted by
    law, Customer foregoes, waives, and releases any and all rights to
    consideration for loss mitigation or foreclosure alternatives which
    may otherwise be available either by law or practice, including,
    without limitation, home retention, deed in lieu of foreclosure, short
    sale or short payoff with respect to the Subject Property and Subject
    Loan.
    Section 4.6 explained that “[o]n or before April 22, 2020 (the ‘Move-out Date’),
    Customer shall vacate the Subject Property, cause any tenants to vacate the Subject
    Property, and deliver possession of the Subject Property to Chase[.]” Section 4.3
    reaffirmed Chase’s right to foreclose, explaining “Customer acknowledges that
    Chase reserves the right to proceed with foreclosure of the Subject Property.
    However, Chase will not cause a foreclosure sale of the Subject Property to occur
    4
    prior to April 22, 2020.” Furthermore, Section 4.1 explained that Chase was not
    obligated to pay Castellucci the $35,000 until she first delivered possession of the
    property in good condition.
    Read in context, Chase’s obligation to pay Castellucci was not a condition
    precedent, and Castellucci’s obligations under the agreement were not contingent
    on her first receiving payment from Chase; to hold otherwise would be to strip
    Chase of its intended benefit under the contract. See 
    Cal. Civ. Code § 1636
     (“A
    contract must be so interpreted as to give effect to the mutual intention of the
    parties as it existed at the time of contracting, so far as the same is ascertainable
    and lawful.”). In fact, Castellucci’s interpretation gets it backward—Chase’s
    obligation to pay was triggered by Castellucci’s performance under the contract,
    not the other way around. Because, under a proper reading of the 2020 Settlement
    Agreement, Castellucci waived any right to pursue further loss mitigation—
    including by submitting additional applications for loan modifications—her claims
    stemming from the denial of her application necessarily fail.2
    Furthermore, the district court did not err in denying leave to amend.
    Castellucci contends that she should have been afforded an opportunity to amend
    her elder abuse claim by adding allegations that she entered into the 2020
    2
    Because we affirm dismissal of Castellucci’s claims based on the 2020
    Settlement Agreement, we need not address the district court’s other reasons for
    denying her claims.
    5
    Settlement Agreement under duress. But while assisted by counsel, she
    represented that she was “fully aware of the terms contained in this Agreement,
    made any desired changes, and . . . voluntarily and without coercion, duress, or
    undue influence of any kind, entered into this Agreement.” She has not explained
    how she could amend her claim to add good faith factual allegations that would
    undermine this provision or would render her duress argument a plausible one.
    Accordingly, the district court was justified in concluding that leave to amend
    would have been futile. See Steckman v. Hart Brewing, Inc., 
    143 F.3d 1293
    , 1298
    (9th Cir. 1998) (“Although there is a general rule that parties are allowed to amend
    their pleadings, it does not extend to cases in which any amendment would be an
    exercise in futility, or where the amended complaint would also be subject to
    dismissal.” (citations omitted)).3
    AFFIRMED.
    3
    Chase moves for judicial notice of two documents relating to a subsequent
    lawsuit filed by Castellucci against Chase while this appeal was pending. See
    Castellucci v. JPMorgan Chase Bank, N.A., No. 2:21-cv-02321, 
    2021 WL 1575233
     (C.D. Cal. Apr. 22, 2021), appeal docketed, No. 21-55554 (9th Cir. May
    28, 2021). That motion is denied as unnecessary, because those subsequent
    developments have no bearing on our decision in this appeal. See Micha v. Sun
    Life Assurance of Can., Inc., 
    874 F.3d 1052
    , 1055 n.5 (9th Cir. 2017). The district
    court dismissed that fourth lawsuit with prejudice, and Castellucci has separately
    appealed that ruling. See Castellucci, 
    2021 WL 1575233
    .
    6
    

Document Info

Docket Number: 20-55852

Filed Date: 10/8/2021

Precedential Status: Non-Precedential

Modified Date: 10/8/2021