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Prest v. Wells Fargo Bank, N.A.

United States District Court, W.D. Louisiana, Shreveport Division

March 17, 2015

CHRISTOPHER PREST
v.
WELLS FARGO BANK, N.A.

MEMORANDUM RULING

S. MAURICE HICKS, Jr., District Judge.

Before the Court is Defendant Wells Fargo Bank's ("Wells Fargo") Motion to Dismiss and Renewed Motion to Dismiss. (Record Documents 10 and 16). Wells Fargo seeks dismissal of any and all of Plaintiff Christopher Prest's ("Prest") claims based on failure to state a claim. Plaintiff opposes the motions. (Record Documents 14, 24 and 29). For the reasons which follow, the Motions to Dismiss are DENIED.

RELEVANT BACKGROUND

Prest decided to purchase a residential lot in Caddo Parish and construct a home on it in the spring of 2012. (Record Document 12 ¶ 3). Prest contacted Wells Fargo to assist with the financing for the house and the lot. (Id. at ¶ 5). To begin the process, Prest met with Terry Fonseca, Jr. ("Fonseca") at Wells Fargo. (Id. at ¶ 6). In order to secure the loan, Wells Fargo required that Prest submit extensive personal and financial information, which was provided by Prest. (Id. at ¶ 7). At some point during the negotiations, Prest alleges that he and Wells Fargo entered into a "written credit agreement, which was in writing, expressed consideration, set for the relevant terms and conditions, and signed by both Prest and a duly authorized Wells Fargo agent." (Id. at ¶ 8).

Prest's credit was approved by Wells Fargo, and Wells Fargo ordered an appraisal of the lot and the proposed house that was to be built on the lot. (Id. at ¶ 10). After a period of time, Prest was notified that his loan had been approved and "locked in" with an interest rate of 3.375%. (Id. at ¶ 12). Wells Fargo then sent its letter of guarantee to Rural Housing Services of the United States of America ("Rural Housing"), which notified Prest that it would guarantee to Wells Fargo the repayment of the loan. (Id. at ¶ 13). Once the letter from Rural Housing was received by Fonseca, he worked with Community Bank of Shreveport ("Community Bank"), for Community Bank to provide Prest with interim financing. (Id. at ¶ 14). Community Bank agreed to provide Prest with the interim loan. (Id. at ¶ 15).

Once Prest obtained the interim loan from Community Bank, he used those funds to acquire the lot, make improvements to the lot, and make an initial deposit so the "manufacturer" could begin construction of the house to be placed on the lot. (Id. at ¶ 16). During the construction of the house, Fonseco updated Prest's loan information two times in order to protect the 3.375% interest rate on the Wells Fargo permanent loan. (Id. at ¶ 18). After several weeks passed without any communication from Fonseco, Prest went to Wells Fargo and learned that Fonseco was no longer with Wells Fargo and that no one in the office knew about the loan. (Id. at ¶ 19). Several days after visiting Wells Fargo, Prest was contacted and informed his paperwork was in order, and that there was an anticipated closing in September, 2013. (Id. at ¶ 20).

By early October, 2013, the closing had still not occurred. (Id. at ¶ 21). Prest contacted Damien at Wells Fargo, who informed Prest that he did not have any information about the closing date.[1] (Id. at ¶ 25). Prest then contacted Bertha, Damien's supervisor, who informed Prest that she could not provide any answers. (Id. at ¶ 26). Bertha provided Prest with the name of Brian, who worked in the St. Louis, Missouri office. (Id. at ¶ 27). Brian informed Prest that Wells Fargo was trying to determine if Prest's house met the guidelines and requirements of Wells Fargo's policy. (Id. at ¶ 28). Prest later receieved a telephone call from Brian, informing him that Wells Fargo would not make the promised loan, due to a "recent guideline change" made by Wells Fargo. (Id. at ¶ 29).

Prest and Community Bank began the process of finding a new permanent lender for Prest. (Id. at ¶ 32). Ultimately, Prest was able to obtain a permanent loan from American Southwest Mortgage on February 5, 2014. (Id. at ¶ 33). The interest rate for the loan from American Southwest was 4.25% instead of the 3.375% that was guaranteed by Wells Fargo. (Id. at ¶ 34).

Wells Fargo has filed a Motion to Dismiss (Record Document 10) and a Renewed Motion to Dismiss (Record Document 16). Prest has filed two Memoranda in Opposition o the Motions to Dismiss (Record Documents 24 and 29). Wells Fargo additionally filed a Reply to Response to Motion re Motion to Dismiss (Record Document 30).

Prest is seeking compensatory damages based on breach of contract, tortioius conduct, unfair trade practices, and mental and emotional distress. (Record Document 12).

LAW AND ANALYSIS

I. Rule 12(b)(6) Standard.

Federal Rule of Civil Procedure 12(b)(6) allows for dismissal of an action "for failure to state a claim upon which relief can be granted." While a complaint attacked by a Rule 12(b)(6) motion does not need detailed factual allegations, in order to avoid dismissal, the plaintiff's factual allegations "must be enough to raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 1964-65 (2007); see also Cuvillier v. Taylor, 503 F.3d 397, 401 (5th Cir. 2007). A plaintiff's obligation "requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id . The Supreme Court recently expounded on the Twombly standard, explaining that a complaint must contain sufficient factual matter to state a claim to relief that is plausible on its face. See Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949 (2009). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable ...


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