Thompson v. JP Morgan Chase Bank Case Update

August 2, 2019

- By The MAR Legal Team

On July 29, a panel of the First Circuit Court of Appeals withdrew its earlier opinion in the Thompson v. JP Morgan Chase Bank case, vacated the decision, and certified a question to the Massachusetts Supreme Judicial Court.

This past Spring, the First Circuit Court of Appeals issued an opinion in Thompson v. JP Morgan Chase Bank in which the court determined that when sending foreclosure notices banks must strictly comply with mortgage language. Although the homeowners never argued in the original case that the notice they received was defective or inaccurate, or prejudiced them in any way, the court, concerned with creating a binding precedent, determined that “it is enough that some hypothetical mortgagor could have been misled by the inaccurate pre-foreclosure notice” and held that the foreclosure notice sent to the homeowner that did not specify the time required for the homeowner to cure as contained in the mortgage was defective. Read our write-up of the Appeals Court decision here.

Following the court’s decision in February, Chase, receiving wide support from the banking industry, requested a rehearing on the matter, where it argued that it followed a state banking regulation for the notice. Chase also requested, as an alternative to reconsidering the case’s merits, that the federal appeals court request the Massachusetts Supreme Judicial Court (SJC) consider the state law issues in the case.  The SJC would then provide its interpretations for the Federal Appeals Court to use in its subsequent consideration of the case.

The First Circuit Court of Appeals certified the following questions to the Massachusetts Supreme Judicial Court:

Did the statement in the August 12, 2016 default and acceleration notice that “you can still avoid foreclosure by paying the total past-due amount before a foreclosure sale takes place” render the notice inaccurate or deceptive in a manner that renders the subsequent foreclosure sale void under Massachusetts law?

The case will return to the First Circuit Court of Appeals once the SJC has issued an opinion on the question before them. Stay tuned!