In Hernandez v. M&T Bank, 2016 WL 816746 (D.N.J. Feb. 25, 2016), the United States District Court for the District of New Jersey dismissed the plaintiff’s claims arising from the plaintiff’s allegations that the bank failed to comply with the Real Estate Settlement Practices Act (“RESPA”) in connection with a commercial loan issued by the bank. In particular, the plaintiff alleged that the Bank failed to comply with RESPA’s requirements that the bank timely respond to both her qualified written request and request for a loan modification.
In analyzing counts one and two premised on RESPA, the Court found that the nature of the loan given by the bank to the plaintiff was commercial based on the documents submitted by the bank in connection with its motion to dismiss. Having determined that the loan was commercial in nature, the Court turned to RESPA’s express provision that it “does not apply to credit transactions involving extensions of credit primarily for business, commercial or agricultural purposes.” Based on this provision, the Court dismissed the plaintiff’s RESPA claims.
Summarily dismissing the RESPA claims on the basis that the plaintiff’s loan was a commercial loan not subject to the statutory provisions of RESPA, the Court exercised supplemental jurisdiction over the plaintiff’s remaining claims of breach of the implied covenant of good faith and fair dealing and negligent infliction of emotional distress and dismissed them in their entirety. Specifically, the Court found that the bank could not have violated the covenant of good faith and fair dealing in refusing to enter into loan modification negotiations with the plaintiff. With regard to the negligent infliction of emotional distress claim, the Court found as a matter of law that the bank’s alleged refusal to renegotiate its loan terms with the plaintiff came “nowhere near the kind [of conduct] that would support” a claim of negligent infliction of emotional distress, which is generally reserved to those instances of extreme conduct.