disclosures prior to settlement. As to this allegation the plaintiffs have not sustained their burden of proof by a preponderance of the evidence. In fact, a preponderance of the evidence discloses that they were given every disclosure required in a transaction of this type under RESPA and the Truth in Lending Act. The settlement statement used here and signed by plaintiffs is the HUD approved form (HUD-1) on which all the charges and their purposes are clearly delineated. 12 U.S.C. § 2603, 24 C.F.R. § 3500.8. Further, plaintiffs signatures appear on an acknowledgement form which specifies that they received a copy of the RESPA special information booklet; 12 U.S.C. § 2604, 24 C.F.R. § 3500.6; a good faith estimate of the settlement services, 24 C.F.R. § 3500.7; a copy of the mortgage and note, a notice of finance charges on the note prescribed by regulation Z, 15 U.S.C. § 1639, 12 C.F.R. § 226.8, an Equal Credit Opportunity Act notice, see 15 U.S.C. § 1691 et seq., and a copy of the disclosure statement required by the state of Pennsylvania. Plaintiffs were represented by counsel at settlement who voiced no objection to the form or substance of the documents given to the McCarricks and the lender's representative, Mr. Francek, not only explained the various papers but was available to answer any questions of plaintiffs or their counsel. A preponderance of the evidence does not support the allegation that plaintiffs were made to sign blank acknowledgments of disclosure. In view of the overwhelming evidence to support the finding that plaintiffs were provided the required disclosures at settlement, I find no violation of RESPA or the Truth in Lending Act in this regard.
Plaintiffs argue next that the defendant refused to attend settlement unless plaintiffs paid $ 592.50 to Emil Karatnjchy. Plaintiffs allege that the money was paid under duress and was the equivalent of an illegal kickback in violation of RESPA which proscribes the giving or acceptance of "any fee, kickback, or thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or a part of a real estate settlement service involving a federally related mortgage loan shall be referred to any person." 12 U.S.C. § 2607(a), 24 C.F.R. § 3500.14(a). In enacting this provision the Congress sought to clarify its intent by statutorily preserving certain transactions from the characterization of an illegal fee, kickback or thing of value. See 12 U.S.C. § 2607(c). Specifically exempted is "the payment to any person of a bona fide salary or compensation or other payment for goods or facilities actually furnished or for services actually performed." Id., 24 C.F.R. § 3500.14(f).
A careful examination of the evidence does not reveal that the circumstances surrounding payment of the fee to the relator here comes within the proscription of § 2607. Plaintiffs retained Mr. Karatnjchy as their agent to obtain a mortgage after their own attorney had not succeeded in obtaining a commitment. They were informed, as shown by the letter of May 24, 1977, that they were expected to pay Mr. Karatnjchy a 1% fee for his services in obtaining the initial mortgage loan, and the increase in the mortgage loan. The evidence does not reveal a scheme by the lender and the realtor which involves payment of a commission for referral of business. There is no evidence that Mr. Karatnjchy is in any way associated with the lender. Mr. Karatnjchy, a licensed realtor, performed a valuable service for the plaintiffs in that he placed the mortgage for them, then arranged for the mortgage to be increased and placed title insurance as requested by plaintiffs. I find no substance to plaintiffs' contention that they were made to pay the fee under duress; indeed it is clear that the fee was not paid by reason of pressure applied by defendant, but was paid only in part by plaintiffs after negotiating a sharing of the fee charge with the sellers. I conclude that the defendant has not committed any violation of 12 U.S.C. § 2607 with respect to the fee paid by plaintiffs to the realtor.
CONCLUSIONS OF LAW
1. This court has jurisdiction over the subject matter of this action as the principal use and purpose of the federally-related mortgage loan was to obtain a residential dwelling bringing the transaction within the jurisdiction provisions of RESPA and the Truth-in-Lending Act.
2. Plaintiffs have failed to demonstrate by a preponderance of the evidence that they were not given all the appropriate disclosures before settlement as required under the Real Estate Settlement Procedures Act and the Truth-in-Lending Act and thus defendant did not violate the Acts in that regard.
3. The fee paid by plaintiffs to Emil Karatnjchy, a licensed realtor, was a fee for services rendered and not a kickback within the meaning of RESPA, 12 U.S.C. § 2607, 24 C.F.R. § 3500.14.
AND NOW, this 11th day of November, 1980, in accordance with the accompanying Findings of Fact, Discussion and Conclusions of Law, IT IS ORDERED that judgment will be entered in favor of the defendant and against the plaintiffs in the above-captioned action.
AND NOW, this 11th day of December, 1980, judgment is entered in favor of defendant and against plaintiffs.
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