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Counterclaims against bank dismissed for failure to state actionable claim

February 13, 2015

The Indiana Court of Appeals affirmed the decision to dismiss a woman’s counterclaims against her mortgage holder after it sought to foreclose on her home. None of her claims, which stemmed from the denial of modifying her mortgage under a new program, stated an actionable claim.

JP Morgan Chase filed to foreclose on Tracey Jaffri’s mortgage after she fell behind on her payments. She sought to modify her mortgage under the federal government’s 2009 Home Affordable Modification Program, but ultimately Chase modified the terms of her mortgage under a different agreement. Jaffri claims those terms are less favorable than those found under HAMP.

After Chase filed the complaint to foreclose, Jaffri filed counterclaims for negligence, breach of fiduciary duty, constructive fraud and intentional infliction of emotional distress based on her nonparticipation in HAMP. After the parties entered into a modification of the mortgage terms, Chase sought dismissal of its complaint, which was granted. It then moved to dismiss Jaffri’s counterclaims, which the trial court granted, without prejudice.

In Tracey M. Jaffri v. JP Morgan Chase Bank, N.A., 32A01-1405-MF-236, the COA affirmed, finding that the contract between Jaffri and Chase does not support her claims. Parties cannot rely on a contractual relationship to create a fiduciary duty, Judge Michael Barnes wrote, and she failed to state any basis upon which she could have been granted relief under a claim of breach of fiduciary duty or constructive fraud.

Jaffir’s attempt to claim that Chase negligently breached its contract with her is not an actionable claim, the COA affirmed, nor did she establish an IIED claim.

“Before HAMP was enacted, Jaffri’s options for remaining in her home would have been even more limited than with the program in place. We are hard-pressed to say that any mishandling of this new program – even if intentional – constitutes the type of beyond-the-pale, ‘outrageous’ conduct that may be covered by an IIED claim,” Barnes wrote.
 

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