Madison County Circuit Judge Don Weber granted National City Mortgage Company's motion for summary judgment and dismissed a $20 fax fee class action case brought by the Lakin Law Firm.
Donald and Patricia Agney had accused the lender of charging an unreasonable fee for faxes in refinancing their loan in 1999.
Their existing loan had an interest rate of 9.5% and their newer loan through National City had a lower rate of 8.49%.
According to court records, the Agney's mortgage broker asked National City to fax them certain documents to facilitate the loan.
"This was an attorney's case from the beginning," said defense attorney Troy Bozarth of the Burroughs Firm at the hearing on a motion for summary judgment on April 27. "The problem is they have a client."
Bozarth told Weber that Patricia Agney did not even remember that she had filed a lawsuit against National City.
Lakin attorney Steve Schweizer said his clients, the Agneys, signed off on the loan agreement under compulsion. He said the contract provided that the lender would not release the proceeds until the borrower paid the fees.
The defense imputed the broker's knowledge to plaintiffs, he argued.
"What they did on the payoff agreement was unlawful," said Schweizer.
Weber noted that the plaintiffs did not complain at the signing.
"Were they recruited?" Weber asked at the April 27 hearing. "How did he get involved in the lawsuit?"
Schweizer said he joined the firm a year ago.
"We have a policy where we do not solicit class plaintiffs," he said.
He said attorneys may advise those who come to the firm.
"How they ended up with our firm I don't know," said Schweizer.
Bozarth said the genesis of the case against National City Mortgage was the Lakin firm filing suits about fees on loans.
He said attorney Tim Campbell told attorney Emert Wyss to look through loan closings at Centerre Title, a company Wyss owned. Neither Campbell nor Wyss are members of the Lakin firm.
On many Madison County class action lawsuits against lenders, however, multiple law firms and attorneys appear as plaintiff's counsel.
Wyss called the Agneys, according to Bozarth. He said it was peculiar that attorneys had personal information about the Agneys.
Weber said, "Stop there, because that is fairly serious. Is that in depositions?"
Bozarth said yes.
"We are dealing with manufactured litigation," said Bozarth.
Bozarth told Weber that Patricia Agney's deposition lasted 15 minutes. He said she did not know she filed a suit.
He said Donald Agney has better memory than his wife but in 1999, when they signed the loan, her mind worked better and she took care of everything.
He said it was improper to use diminished memory to create issues of fact.
Bozarth argued that a broker for the Agneys knew about the fax fee and the Agneys knew in many ways. He said the monthly payment coupon showed the fee.
In a similar suit from 2003, plaintiff Carmelita McLaughlin stated in a deposition that Wyss contacted her about a loan Centerre Title closed.
The defendant in that suit, Alliance Mortgage, moved for sanctions against plaintiff counsel for failure to join Centerre Title as a defendant.
Wyss filed a "fee renunciation letter" under seal.
Alliance moved to add Centerre Title as third party defendant, arguing that if anything went wrong at closing the title company should have caught it.
Circuit Judge Phillip Kardis added not only Centerre Title but Wyss personally as third party defendants. Later Kardis dismissed Wyss but not Centerre Title.
In his order granting summary judgment and dismissing the suit Weber wrote, "The court is of the opinion that the crux of this matter is whether or not the Agneys, or their agent, knew of the fax fee and whether or not the Agneys voluntarily paid the fee."
"Donald Agney steadfastly maintains that he …"didn't know they was going to have all these hidden charges..," however, the charges were normal and customary and were disclosed on the Agneys coupon book," Weber wrote.
"There is strong positive evidence that the fax fee was disclosed to the plaintiffs," Weber wrote.
"Despite the fact that the fax was ordered by plaintiffs agent, disclosed to the plaintiffs agent and almost certainly disclosed on their coupon book, plaintiffs argue that the fax fee charged by the defendant was in fact coercive."
Weber also wrote, "Further inquiry leads us to the deposition of Donald Agney. The plaintiffs, and the class they seek to represent, are bound by their own deposition testimony, particularly in light of the fact that no counter affidavit or other sworn testimony is in the record."
Using Donald's deposition Weber wrote that Agney stated he was not "threatened" or "intimidated" into paying the fax fee.
"It is well settled that a class cannot be certified unless the named plaintiffs have a cause of action," wrote Weber citing Avery v. State Farm.
"Although the plaintiffs attorneys advocated their case well in both the briefs and at the presentation of the argument, the court prefers to take a common sense view of the evidence," Weber wrote.
"The fax fee was only $20, compared to a better than 1% reduction of their mortgage. Additionally, the fax fee was almost certainly disclosed to the plaintiffs on their coupon book."
"No evidence exists to rebut either of these facts."
"Plaintiffs were apparently pleased about their new mortgage since they did not object to the fax fee for 4 years and until they were contacted by the class action attorneys."
Steve Korris contributed to this report