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Branche v. Wells Fargo Mortgage Co.

United States District Court, Third Circuit

November 6, 2013



WILLIAM W. CALDWELL, District Judge.

I. Introduction

Before the Court are motions for summary judgment filed by Defendant Wells Fargo (Doc. 103), and Plaintiff Annette Branche (Doc. 118). Plaintiff filed this action on March 11, 2011. All defendants except Wells Fargo have been dismissed. On August 16, 2012, we granted summary judgment in favor of Wells Fargo on two of Plaintiff's four claims. (See Doc. 79). Plaintiff's remaining claims are for breach of contract (Count I), and an alleged violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law ("UTPCPL") (Count III). Defendant moves for summary judgment on both claims, arguing that Plaintiff lacks standing to bring them, or, alternatively, that the claims fail on the merits. Plaintiff also moves for summary judgment, arguing that no dispute of material fact remains, and that she should succeed on both claims.

II. Background

Plaintiff Annette Branche resides at a property in Harrisburg, Pennsylvania, that she inherited from Charles C. White in 2000. Plaintiff has served as the administrator of Mr. White's estate (hereinafter "Estate") since his death. Defendant Wells Fargo services the mortgage on the property, which was originally in Mr. White's name, and is now in the name of the Estate. Plaintiff makes the monthly payments.

In 2006, Plaintiff hired C&G Contractors ("C&G") to renovate the house for a catering business. After becoming dissatisfied with its work, and upon learning that it was not a licensed contractor, Plaintiff fired C&G. By this time, C&G had caused considerable damage to the home. Plaintiff sued C&G in county court and was awarded $2, 367.80, representing the money she had paid them. Approximately six to eight months after the damage occurred, Plaintiff filed a homeowner's insurance claim for vandalism on an American Security Insurance Company policy owned by the Estate. In October 2008, following several rounds of estimates, American Security offered $24, 665 to repair the damage. From this amount, American Security subtracted $4, 913 for depreciation, $500 for the policy deductible, $2, 367.50 for Plaintiff's county court award, and $27.50 for a prior payment. As the named mortgagee on the insurance policy, Defendant Wells Fargo was entitled to oversee the repairs and disburse funds. Consequently, a check in the amount of $16, 756.92 was sent to Wells Fargo and placed in an escrow account.[1] Later, American Security adjusted the claim upward, and an additional $2, 765 was sent to Wells Fargo.

On December 3, 2008, Defendant Wells Fargo sent the Estate a letter, care of Plaintiff, outlining the options for disbursing the funds. Plaintiff chose the option of selecting a contractor to complete the repairs, with payments to be issued according to Wells Fargo's guidelines. Defendant's letter explained that the funds would be released in "1/3 increments to cover the cost of the repairs as they are completed." (Doc. 111, Exhibit H). The first one-third of the funds would be released after Wells Fargo received an estimate and proof the contractor was licensed, among other items. The second one-third would be released after an inspection ordered by Wells Fargo certified that the repairs were 50% complete. The final one-third would be released once an inspection showed the repairs were 100% complete. (Doc. 111, Exhibit H).

Plaintiff selected Markle Home Improvements ("Markle") as the contractor. Markle's written estimate was for $29, 800-approximately $10, 000 in excess of the insurance funds available at the time. Plaintiff signed a contract with Markle on December 16, 2008. While Plaintiff told Markle that the funds were coming from an insurance policy, Plaintiff did not explain the three-step disbursement process. Plaintiff completed the steps to obtain the first release of funds on December 11, 2008, and Wells Fargo paid the first disbursement, in the amount of $6, 497.30, on December 17, 2008.[2] The second disbursement, in the amount of $6, 497.31, was released on January 9, 2009.[3]

On January 27, 2009, American Security again adjusted the claim upward by $4, 500 for additional plumbing and electrical work. On April 3, 2009, Plaintiff contracted with Gettle Electric to perform this work, at an estimated cost of $6, 200.

Markle became dissatisfied with the timing of its payments, and stopped work on the property. Plaintiff then selected Bero Remodeling ("Bero") to complete the project. Plaintiff contracted with Bero on or about July 13, 2009, for an estimated cost of $18, 200. (Doc. 111, Exhibit O). On March 22, 2010, Wells Fargo released a disbursement in the amount of $10, 740, at least $9, 000 of which was paid to Bero.[4] On May 13, 2010, the property was inspected and the repairs were determined to be 95% complete. On May 19, 2010, Plaintiff signed a Certificate of Completion, certifying that the repairs were 100% complete. Wells Fargo released the final disbursement of $5, 197.89 on May 26, 2010, which was paid to Bero. In total, Wells Fargo released approximately $29, 000 to Plaintiff and her contractors. Plaintiff currently owes Bero $5, 542.11. (Doc. 111, Exhibit P).

On March 11, 2011, Plaintiff filed this suit against Markle Home Improvement, Gettle Electric, Bero Remodeling, American Security Insurance Company, and Wells Fargo. The only remaining claims are against Wells Fargo for breach of contract and deceptive trade practices. Plaintiff claims that Wells Fargo breached its promises in the December 3, 2008 letter by failing to provide timely payment to Plaintiff's contractors. She also claims that Wells Fargo violated an "implied contractual obligation" to permit plaintiff to safely occupy the premises of her house (Doc. 119 at 6), and that it violated the duty of good faith. Last, Plaintiff claims that Wells Fargo engaged in "deceptive and misleading actions, misrepresentations and fraudulent behavior." (Doc. 119 at 11). Both parties now move for summary judgment.

III. Discussion

A. Standard of Review

We will examine the motion for summary judgment under the well-established standard. Lawrence v. City of Philadelphia , 527 F.3d 299, 310 (3d. Cir. 2008) ("Summary judgment is only appropriate if there are no genuine issues of material fact."). We "must view all evidence and draw all inferences in the light most favorable to the non-moving party" and we will only grant the motion "if no reasonable juror could find for the non-movant." Id . "Material facts are those that could affect the outcome' of the proceeding, and a dispute about a material fact is genuine if the evidence is sufficient to permit a reasonable jury to ...

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