Anthony v. Hobbs (In re Hobbs)

IN RE: CAMI CHELESE HOBBS xxx-xx-6399 DebtorGINNA ANTHONY Plaintiff

v.CAMI CHELESE HOBBS a/k/a CAMI KISH Defendant

Case No. 10-42736

Adversary No. 10-4225

UNITED STATES BANKRUPTCY COURT FOR THE EASTERN DISTRICT OF TEXAS SHERMAN DIVISION

Filed: September 24, 2012

Chapter 7

FINDINGS OF FACT AND CONCLUSIONS OF LAW¹

Upon trial of the complaint filed by the Plaintiff, Ginna Anthony ("Plaintiff") seeking a determination of whether an alleged debt owed to it by the Defendant-Debtor, Cami C. Hobbs ("Hobbs" or "Debtor"), is dischargeable, the Court issues the following findings of fact and conclusions of law. The Plaintiff contends that the debt is non-dischargeable under various subsections of 11 U.S.C. §523(a). After the trial, the Court took the matter under advisement. This decision disposes of all issues pending before the Court.

FINDINGS OF FACT²

1. The Debtor-Defendant, Cami C. Hobbs, has been a realtor in the Denton area for the past eleven (11) years, primarily as a listing agent.³

2. In December of 2007, the Defendant was working as an agent for the Real T Team, Inc., when the Plaintiff, Ginna Anthony, contacted her about locating an unimproved residential lot for purchase.

3. Among the Defendant's real estate listings for sellers were two (2) unimproved lots listed for Vanad Singarvelu, the owner of lots in the Lakeview Ranch subdivision in Denton County, Texas.⁴

4. The two Lakeview lots were in the process of being purchased by builder, Don Wiley. Wiley planned on subdividing the property into multiple lots for custom homes and was working with the City of Denton to accomplish this goal prior to the closing on the lots.⁵

5. In January 2008, the Defendant showed the Lakeview lots to the Plaintiff and introduced the Plaintiff to Wiley.

6. Though the agent for Singarvelu, the Defendant did not have a listing agreement with Wiley, nor did she obtain a buyer's representation agreement from the Plaintiff.

7. The Plaintiff subsequently elected to purchase from Wylie Lot 24A-A, Block 11, of the Lakeview Ranch Subdivision, Denton County, Texas, more commonly identified as 459 Lakeview Blvd. in Denton (the "Lakeview Lot").

8. Wiley called the Defendant and requested that she prepare the contract of sale for the lot according to the terms he provided.⁶

9. Wiley then gave the contract to the Plaintiff to review.⁷

10. On or around January 19, 2008, the Plaintiff and Wiley signed the Unimproved Property Contract for purchase of the Lakeview Lot for $85,000.⁸

11. The Unimproved Property Contract contained a provision that identified the Defendant as a "Seller's agent" entitled to a 3% commission.⁹

12. Though she claimed that she never knew of this provision, the Plaintiff eventually agreed to the payment of the 3% commission on the purchase of the Lakeview Lot as a matter of fairness since the Defendant first exposed her to the availability of the Lakeview Lot.

13. The Plaintiff closed on the purchase of the Lakeview Lot on May 8, 2008 and paid a commission of $2,550.00 to the Defendant.¹⁰

14. The Plaintiff proceeded to negotiate with Wylie for the construction of a residence upon the Lakeview Lot.

15. On March 26, 2008, Wiley, as "Builder," and the Plaintiff, as "Homeowner," signed an agreement titled "Custom Home Build"(hereinafter, the "Builder Contract"). The Builder Contract required the Plaintiff to provide permanent and interim financing costs, with the total projected cost of materials and labor for the construction of the home at $325,500.00, with a 15% Builder's Fee, and it provided that construction will begin "immediately upon financing approval."¹¹

16. The Defendant was not involved in the negotiations regarding the Builder Contract.¹²

17. The Builder Contract contained no provision for the payment of any commission to Defendant.

18. Upon completion of the construction process, the Plaintiff sought to convert her interim construction loan to permanent residential financing. Closing was set for December 31, 2008 in the offices of Title Resources, a title company.¹³

19. On December 17, 2008, the Defendant sent a "Commission Disbursement Authorization" to Title Resources, claiming entitlement to a 3% commission of $9,780.00 based upon the construction price of the residence under the Builder Contract.¹⁴

20. Virginia, an escrow officer with Title Resources, subsequently called the Defendant to inform her that the Plaintiff had reviewed the proposed closing statement and had advised Title Resources that she was not going to pay any commission to the Defendant.¹⁵

21. On or about December 19, 2008, the Defendant signed and filed an "Affidavit of Lien -Original Agent-Individual" claiming a mechanic's or materialman's lien on the real property and improvements constituting the Lakeview Lot.¹⁶

22. The lien purported to secure payment of an amount of $9,780.00 "for unpaid commission agreed upon at initial meeting with Builder, buyer, and Real Estate Agent."¹⁷

23. Such act was performed by the Defendant without notice to the Plaintiff.

24. There was no factual or legal basis entitling the Defendant to file a mechanic's lien against the Lakeview Lot.

25. There was no oral agreement by the Plaintiff arising from any "kitchen discourse" under which the Plaintiff agreed to pay a commission to the Defendant arising from the building of the residence upon the Lakeview Lot.

26. There was no other agreement by the Plaintiff, written or oral, under which she agreed to pay a commission to the Defendant arising from the building of the residence upon the Lakeview Lot.

27. At the time of its filing, the Defendant knew that she possessed no factual basis for the filing of a mechanic's lien against the Lakeview Lot.

28. As a person experienced in real estate transactions, the Defendant was aware that the filing of such a lien could have a harmful effect upon a landowner.

29. Notwithstanding her knowledge that she possessed no factual basis for the filing of a mechanic's lien against the Lakeview Lot and her knowledge of the detrimental effect that the lien filing could cause, the Defendant filed the lien affidavit anyway as a means to coerce the Plaintiff to pay an additional commission that was not actually due and owing.

30. The filing of the mechanic's lien affidavit against the Lakeview Lot by the Defendant constituted a fraudulent lien.

31. The Defendant filed the mechanic's lien affidavit against the Lakeview Lot with knowledge that it was a fraudulent lien.

32. The Defendant intended for the mechanic's lien affidavit against the Lakeview Lot to be given legal effect, evidencing a valid lien or claim against real property.

33. The Defendant intended to cause financial injury to the Plaintiff by the filing of the mechanic's lien affidavit against the Lakeview Lot.

34. The Defendant intentionally inflicted this injury upon the Plaintiff, knowing that a financial injury to the Plaintiff was a natural consequence of the filing of the fraudulent lien, which the Defendant hoped the Plaintiff would mitigate by paying the demanded, but undeserved, commission.

35. In fact, the Defendant was expressly relying upon the infliction of such an intentional injury as a means to coerce the payment of the demanded commission and she called the title company prior to the scheduled closing to ascertain whether her coercion had succeeded.

36. The Defendant filed the mechanic's lien affidavit against the Lakeview Lot with an intent to defraud.

37. The filing of the mechanic's lien affidavit against the Lakeview Lot by the Defendant was a deliberate and intentional act by the Defendant.

38. The filing of the mechanic's lien affidavit against the Lakeview Lot by the Defendant was intentional infliction of an injury by the Defendant.

39. The filing of the mechanic's lien affidavit against the Lakeview Lot by the Defendant was a deliberate and intentional act that was taken by the Defendant with a subjective motive to cause harm to the Plaintiff.

40. The filing of the mechanic's lien affidavit against the Lakeview Lot by the Defendant was a deliberate and intentional act that was taken by the Defendant under circumstances evidencing an objective substantial certainty of harm.

41. The filing of the mechanic's lien affidavit against the Lakeview Lot by the Defendant did, in fact, cause harm to the Plaintiff.

42. When the Plaintiff arrived for the closing on December 31, 2008, she was informed that the Defendant had filed the mechanic's lien against the Lakeview Lot.

43. The December 31 closing could not proceed as scheduled.

44. On December 31, 2008, the Defendant contacted the title company to see if the commission had been paid and learned that the closing had been delayed because of the filing of the lien.

45. On January 7, 2009, the Plaintiff filed a petition before the 367th Judicial District Court of Denton County, Texas, under Miscellaneous Case No. 2009-50005-367 seeking, in part, to have the Defendant's purported lien declared invalid pursuant to the ex parte procedures authorized under §51.903 of the Texas Government Code.¹⁸

46. On January 7, 2009, the 367th Judicial District Court entered an order invalidating the lien. Its order specifically provided that:

"upon review of the documentation or instrument ... the documentation or instrument attached to the motion [i.e., the lien affidavit] is NOT created by implied or express consent or agreement of the obligor, debtor or the owner of the real or personal property ... or by implied or express consent or agreement of an agent, fiduciary or other representative of that person."¹⁹

47. Upon providing her lender and the title company with a certified copy of the 367th Judicial District Court's order, the Plaintiff was able to proceed to the closing on her conversion of her interim construction loan to permanent residential financing on January 7, 2009.

48. On May 4, 2010, during the mediation of claims asserted in a subsequent state court lawsuit brought by the Plaintiff against the Defendant,²⁰ the Defendant filed a Release of...