The Real Estate Settlement Procedures Act (RESPA) requires mortgage servicers to respond to qualified written requests (“QWRs”) for information from borrowers relating to the servicing of their loan within five days. Where a servicer fails to comply with this requirement, the borrower may bring an action to recover “any actual damages to the borrower as a result of the failure,” as well as “attorney fees incurred in connection with such action”
Sherry Ann Murray’s lawyer sent a QWR to her loan servicers, but the servicers did not timely respond. Her lawyer then prepared a second QWR, and charged her $225 in fees, plus $3.20 for postage. Again, the servicers did not respond.
Murray then sued, claiming, among other things, the $228.20 she spent on the second QWR constituted actual damages. The district court dismissed her claim, holding that her attorney’s fees were not “actual damages” under ERISA. Today, a split Second Circuit affirmed, reasoning that the statute’s separate provision allowing the recovery of “attorney fees incurred in connection with [the RESPA] action” meant that attorney fees can’t be part of actual damages. In my view, persuasively, Judge Perez explains why that is wrong: the attorney fee provision of the statute goes to attorney fees for the work in connection with the RESPA litigation, not work distinct from the lawsuit.
