In a previous proceeding, the court dismissed the borrower’s case in response to the lender’s motion to dismiss. The borrower, who had originally filed for Chapter 7 bankruptcy in 2010 and emerged a year later, filed the instant lawsuit. The borrower sought to quiet title for a deed of trust that she signed in 2006, but had not made any payments on the property since 2011. The deed itself contained a provision for the awarding of attorneys’ fees. The borrower originally filed her cause of action in state court but moved to federal court after the Washington State Supreme Court ruled that the statute of limitations for installment payments begins to run after each installment due date. After removal to federal court, the lender moved for attorneys’ fees for both its motion to dismiss and for its motion to sanction the borrower. The lender argued that the borrower knew of the meritless nature of her claims and that both the clause in the deed and Washington State law required the payment of attorney’s fees. The court denied the lender’s motion for sanctions because the lender failed to comply with several procedural requirements and failed to provide sufficient evidence to support its motion. The lender then submitted a motion for attorney’s fees from the borrower for both the motion to sanction and the motion to dismiss.
In Roe v. Deutsche Bank Nat'l Trust Co. N.A., No. 3:24-cv-05338, 2025 WL 388650, 2025 U.S. Dist. LEXIS 19794 (W.D. Wash., Feb. 4, 2025) (opinion not yet released for publication), the court granted the lender attorney’s fees on its motion to dismiss but denied the motion for sanctions. The court found that both the deed’s attorney’s fees provision and Washington State law permitted the court to require the borrower to pay the lender. Here, the court found the award of attorney’s fees proper because the borrower had initiated a lawsuit outside of the original bankruptcy case to get out of paying for a loan. The court reasoned that the award was proper because the lender had to go out of its way to defend itself from an almost frivolous lawsuit. Furthermore, the court rejected the borrower’s argument that the bankruptcy case had discharged her from paying the loan and the attorney’s fees provision in the deed. However, the borrower succeeded in obtaining relief from paying the fees for the lender’s sanctions motion due to the lender’s numerous procedural errors.
By Conor Doris, [email protected]
Edited By Taylor O’Brien, [email protected]
Edited By Hayden Mariott, [email protected]