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Zwiebach v. Citimortgage, Inc.

United States District Court, D. Connecticut

September 14, 2017




         I. Introduction

         Before the Court is Defendant's Motion for Summary Judgment. Plaintiffs Martin and Elizabeth Zwiebach bring this action for declaratory and injunctive relief against Defendant Citibank, N.A. (“Citibank”), incorrectly identified by the Plaintiffs as CitiMortgage, Inc., asking the Court to declare that their home equity line of credit loan be deemed satisfied and paid in full. In support, Plaintiffs allege that they tendered and Defendant cashed a $35, 000 check on which was written that the payment was intended to be “in full satisfaction and accord” of the amount then owed. Defendant now moves for summary judgment, arguing that the instrument cannot constitute an accord and satisfaction under the contract governing the Plaintiffs' account. For the reasons that follow, Defendant's Amended Motion for Summary Judgment [Dkt. No. 22] is GRANTED.

         II. Background

         On February 9, 2011, Mr. Zwiebach entered into a Home Equity Line of Credit Agreement and Disclosure (“Credit Agreement”) with Citibank Federal Savings Bank (“FSB”) for a home equity line of credit (“HELOC”) account ending in 7262, with a credit limit of $425, 000. [Dkt. No. 22-3, Wood Aff. ¶ 5, Exh. 1 at 1]. On that same date, and to secure the HELOC, Plaintiffs executed a Home Equity Line of Credit Mortgage (“Mortgage”) in favor of Citibank FSB, encumbering the property located at 53 Singing Oaks Drive, Weston, Connecticut. [Id., Wood Aff. ¶ 6, Exh. 2 at 1]. The Mortgage was recorded on or around February 14, 2001 in volume 293 at page 630 of the Weston land records. [Id., Wood Aff. ¶ 7, Exh. 2 at 1]. Citibank FSB merged into Citibank, N.A. as of October 1, 2006. [Id., Wood Aff. ¶ 8, Exh. 3 at 1-3]. Under the terms of the merger, Citibank, N.A. is the successor in interest with respect to the Credit Agreement. [Id., Wood Aff. ¶ 9].

         The Credit Agreement contains a paragraph titled “Monthly Payment Plan, ” which states:

You agree to pay to Us in U.S. dollars at least the Payment Due each month by the Payment Due Date as indicated in Your monthly billing statement . . . . We may, but need not, credit partial payments to Your Account. This will not excuse Your having to make the rest of the payment, notwithstanding any “payment in full” or similar language on Your payment, nor does it excuse You from having to make full payments in the future. Any payment You make which relates to an amount in dispute, or which claims to be a “payment in full” must be sent to: Citibank, Item Processing, Mail Stop 759, P.O. Box 790159, St. Louis, MO 63179.

[Id., Exh. 1 at 1-2]. The Mortgage also states that Mr. Zwiebach “shall promptly pay when due the indebtedness secured by [the] Mortgage including, without limitation, that evidenced by the [Credit Agreement].” [Id., Exh. 2 at 1].

         Mr. Zwiebach became indebted to Defendant by borrowing money on the HELOC pursuant to the terms of the Credit Agreement. [Id., Wood Aff. ¶ 10]. Mr. Zwiebach failed to pay the minimum amount due to the Defendant on June 3, 2011, and failed to make subsequent minimum monthly payments. [Id., Wood Aff. ¶ 12].

         By letter dated September 19, 2014, the Plaintiffs' tax representative, David Selig, sent to Citibank a written settlement offer in which he stated that the Plaintiffs wished to “compromise their second mortgage obligation for [the] lesser amount” of $100, 000, and in which they requested a “face-to-face meeting with a CitiMortgage representative.” [Dkt. No. 30-2, Exh. 2].

         On or around October 19, 2015, Mr. Zweibach mailed a check to the Defendant in the amount of $35, 000. [Dkt. No. 22-3, Wood Aff. ¶ 14]. On the check was written “ACCORD/SATISFACTION: SEE ATTACHED LETTER DATED 12 OCT. 2015.” [Dkt. No. 30-3, Exh. 5]. The check was accompanied by a letter from Selig dated October 12, 2015, which stated that the check was offered as full and final payment of Plaintiffs' debt on the HELOC. [Dkt. No. 22-3, Wood Aff. ¶ 14, Exh. 6 at 2]. The letter also stated that Mr. Zwiebach's “good faith attempt to resolve [his] claims against, and liabilities to Citi . . . have been deliberately frustrated by mortgagor's employees . . . [who] intentionally protracted the payment process by refusing to candidly discuss [Mr. Zwiebach's] liabilities, by ignoring [his] written requests for a conference, and by providing contradictory information.” [Dkt. No. 30-2, Exh. 5]. Selig also stated that “neither [Mr. Zwiebach] nor his agent can accurately reconcile [Citibank's] statements, specifically, the application of payments previously made, the imposition of penalties, and the calculation of interest thereon.” Id.

         Both the letter and the check were mailed to Citimortgage, Inc., P.O. Box 790005, St. Louis, MO 63179-0005 despite the fact that, as stated above, the parties agreed that all payments which claim to be a “payment in full” had to be sent to: Citibank, Item Processing, Mail Stop 759, P.O. Box 790159, St. Louis, MO 63179. [Dkt. No. 22-3, Exh. 1 at 2; Dkt. No. 30-2, Exh. 5]. Plaintiff submitted U.S. Postal Service return receipts as evidence that he mailed three letters to Citibank, two on September 22, 2014, and one on October 16, 2015. None of these letters were sent to the “payment in full” address. [See Dkt. No. 30-2, Exh. 9].

         By letter dated November 3, 2015, Selig stated that he was “unable to reconcile [Mr. Zwiebach's] payments to the balance owed, ” and that he had not received a “true and complete copy of [Mr. Zwiebach's] payment history, from the first period of delinquency, which exceeded 60 days to the present, ” which he states he requested on June 22, 2015. [Id., Exh. 6].

         Selig also exchanged emails with Citibank representatives in January 2016, in which he asked about the status of the HELOC “settlement offer.” [Id., Exh. 7]. The Citibank representative responded that “[N]othing is in process. I haven't received any documents. I have not spoken to you. I need to update the borrower's income and expenses in the system, verbally. I must send you a list of documents. You must then return those to me complete. Once they are complete the process will begin and your client will be reviewed for settlement.” Id. The Plaintiffs' tax representative responded that he had already requested a meeting regarding the Plaintiffs' account and had sent numerous follow-up letters. Id. Selig then emailed the Citibank representative asserting that the HELOC obligation had ...

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