Lawyers for owners of a mortgage-free Florida home that Bank of America attempted to foreclose on are bringing an arsenal of legal claims against the banking giant, ranging from obvious claims like conversion and trespass to more unexpected ones like defamation and libel.
Massachusetts residents Charlie and Maria Cardoso, who claimed they bought their second home in Spring Hill, Fla., with cash, sued Bank of America in the District of Massachusetts on Jan. 20 based on actions the bank took in the foreclosure attempt.
The legal claims in the case include trespass, conversion, negligence, negligent infliction of emotional distress, intentional infliction of emotional distress, interference with contractual relations, defamation and libel.
The Cardosos are seeking unspecified damages, plus punitive and/or multiple damages, and attorney fees and costs.
According to the complaint, the New Bedford, Mass., couple had a tenant living in the Florida home when workers from Bank of America showed up to foreclose on the home in July.
The lawsuit claims that Charlie Cardoso had telephone conversations in July with one of the workers and a Bank of America realtor who was listing the home to explain that he owned the home without a mortgage.
The tenant, who moved out in December, returned on Jan. 5 with a Cardoso family friend to pick up stored belongings. The pair found Bank of America workers putting locks on the doors.
According to the complaint, Mr. Cardoso called the tax assessor, who told him that Countrywide Home Loans Inc., which Bank of America Corp. acquired in 2008, had paid the taxes and gave Cardoso a telephone number to call. The company told Mr. Cardoso it had made a mistake and would fix the problem and call him back.
When the company didn't call back, one of Mr. Cardoso's sons drove him to Florida. He arrived in Florida on Jan. 9, and local police allowed him to enter the home on Jan. 10. He found that Bank of America had removed his family's belongings. The company had also shut off the electricity, which caused water damage from frozen pipes.
This kind of situation should not happen, but it's happening all over the country, said Carlin Phillips, of North Dartmouth, Mass.-based Phillips & Garcia, who is representing the Cardosos.
"This is absolutely devastating for the clients and their worst nightmare," Phillips said. "[Bank of America] invaded their home that was bought and paid for. They had to travel to Florida to prove they owned their home."
Joseph deMello, a Taunton, Mass. solo practitioner who is another of the Cardosos' attorneys on the case, said the lawyers plan to file an amended complaint naming individual defendants currently listed as John Does 1-5 on the lawsuit.
The lawsuit describes the John Does as "employees, agents, contractors or other persons, ordered, hired, or told by BOA to trespass on the plaintiffs' property and to dispose of the plaintiff's personal possessions."
"[We're looking at everyone] from the realtor to the "trash out" company; they all trespassed and broke and entered," deMello said. "They also caused intentional infliction of emotional distress, by going in after knowing it was the wrong house."
The contractual interference claim, which is asserted just against Bank of America, arises because the Cardosos' tenant left, and they weren't able to release the house because of the uncertainty created by the false foreclosure.
The lawsuit claims Bank of America intimidated the tenant, who had a lease for yearly rental of the house, into leaving.
Many of the claims, including trespass, conversion of property and emotional distress, are obvious and fundamental law, deMello said.
Libel and defamation come into play because Bank of America's actions harmed the Cardosos' reputation among Bank of America's employees, agents and contractors and the Cardosos' friends and acquaintances.
The lawsuit says the company's actions harmed the Cardosos' reputation with their tenant, a family friend whom they paid to cut the grass and care for the house, and other friends and family, including some with nearby homes.
"In their community they have certainly had their reputation tarnished," deMello said.
In an e-mailed statement, Bank of America said the case "revolves around allegations that the wrong home was secured following a foreclosure on a nearby property."
"We continue to research the matter," stated the bank. "In the meantime, the bank has reached out to the [Cardosos'] counsel and hopes to have the opportunity to work with them to properly assess and address their allegations. We will move quickly to review the allegations in the lawsuit, the actual events that led to them and the causes of those events, and consider any hardship that resulted."
Joseph Steinfield, a litigator at Boston's Prince Lobel Glovsky & Tye who specializes in libel cases, particularly related to the media, and is not involved in this action, said the defamation claims appear specific enough to survive a motion to dismiss.
Steinfield also noted that the plaintiffs are not public officials or public figures, so they simply need to prove negligence to prevail on the defamation claim, which involves verbal statements made by Bank of America and its employees, agents and contractors.
Public officials or figures, in contrast, must prove that a speaker knew a particular statement was false.
"For ordinary folks who are not public officials and who are not public figures, all they need to show is that the incorrect statement was made negligently, made carelessly," Steinfield said.