Mr. Campbell eventually encountered financial difficulties and was approximately
$25,000 in arrears as of March 15, 2008. Around this time, Mr. Campbell
attempted to renegotiate his loan with IndyMac Bank and, according to Mr.
Campbell, IndyMac Bank offered to modify his loan to a forty-year fixed interest
rate loan and to cease all foreclosure activities. IndyMac Bank promised to send
Mr. Campbell the modification papers within ninety days and Mr. Campbell
accepted the offer and began making the modified monthly payments on his
mortgage on April 1, 2008. After ninety days, Mr. Campbell still had not
received the modification papers so he contacted IndyMac Bank. He was told that
he had been approved, but that he should continue to wait for the papers because
of a backlog. Mr. Campbell continued to make the new monthly mortgage payments
and IndyMac Bank returned Mr. Campbell's November 2008 payment; therefore, Mr.
Campbell contacted IndyMac Bank. IndyMac Bank advised Mr. Campbell to ignore the
return payment and to continue making payments. Mr. Campbell continued his
monthly payments until January 2009 when he was told that he did not qualify for
a loan modification. Unfortunately, his house is currently in foreclosure and
the Defendants are pursuing collection activities. For these reasons, Mr.
Campbell commenced a civil action against the Defendants on September 15, 2009.
A. Breach of Contract
Mr. Campbell claims that the Defendants breached their
contract to modify his home loan; however, he has not alleged that the agreement
was ever committed to writing and signed by the Defendants. Accordingly, the
alleged contract is not enforceable under Maryland's Statute of Frauds for two
distinct reasons: (1) it cannot be performed fully within one year; and (2) it
involves an interest in real estate. MD. CODE ANN., CTS. & JUD. PROC. §
5-901(3); MD. CODE, REAL PROP. § 5-104.
Under MD. CODE, CTS. & JUD. PROC. § 5-901(3), an action may
not be brought "[o]n any agreement that is not to be performed within 1 year
from the making of the agreement," unless either the contract, agreement or
"some memorandum or note of it, is in writing and signed by the party to be
charged or another person lawfully authorized by that party." When parties
"expressly and specifically agree that their oral contracts are not to be
performed within one year," the Statute of Frauds will bar any claims.
Here, the parties allegedly agree that Mr. Campbell would
make monthly payments for a period of forty years, which is an agreement that
cannot be performed within one year. Therefore, the oral contract is not
enforceable under Maryland's Statute of Frauds.
Mr. Campbell is also bared from enforcing his oral contract
because mortgage contracts fall within the Statute of Frauds. As the oral
contract modified Mr. Campbell's home loan and thus concerned an interest in
real property, it cannot be enforced.
B. Intentional Misrepresentation
Mr. Campbell also claimed that the Defendants committed
intentional misrepresentation by falsely telling him that his loan would be
modified in order to induce him to make monthly payments pursuant to the
To state a prima facie claim of intentional
misrepresentation, or fraud, in Maryland, the plaintiff must demonstrate:
(1) that a representation made by a party was false; (2)
that either its falsity was known to that party or the misrepresentation was
made with such reckless indifference to truth to impute knowledge to him; (3)
that the misrepresentation was made for the purpose of defrauding some other
person; (4) that that person not only relied upon the misrepresentation but had
the right to rely upon it with full belief of its truth, and that he would not
have done the thing from which damage resulted if it had not been made; and (5)
that that person suffered damage directly resulting from the misrepresentation.
Mr. Campbell's Complaint did not plead facts sufficient to
make a prima facie case of intentional fraud and consisted only of conclusory
allegations. This was not enough to survive a Motion to Dismiss. Mr. Campbell's
fraud claim mainly consists of recitations of the elements required to prove
intentional misrepresentation, unsupported by facts. Moreover, because
intentional misrepresentation is a claim based on fraud, it is subject to the
heightened pleading requirements of FED. R. CIV. P 9(b). RULE 9(b) requires a
Plaintiff to plead "with particularity the circumstances constituting fraud."
Given the dearth of facts in the Complaint, Mr. Campbell's claim of
misrepresentation fails under the Rule 9(b) pleading requirements as well.