                NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                           File Name: 12a0608n.06

                                            No. 11-1908

                          UNITED STATES COURT OF APPEALS
                               FOR THE SIXTH CIRCUIT
                                                                                          FILED
                                                                                     Jun 12, 2012
KELI MURILLO,                                             )
                                                                               LEONARD GREEN, Clerk
                                                          )
       Plaintiff-Appellant,                               )
                                                          )        ON APPEAL FROM THE
               v.                                         )        UNITED STATES DISTRICT
                                                          )        COURT FOR THE EASTERN
WASHINGTON MUTUAL BANK, F.A., their                       )        DISTRICT OF MICHIGAN
Successor and Assigns, including but not limited to, JP   )
Morgan Chase Bank, National Association, doing            )
business as Washington Mutual,                            )
                                                          )
       Defendant-Appellee.                                )
                                                          )


BEFORE: MOORE, ROGERS, and GRIFFIN, Circuit Judges.

       GRIFFIN, Circuit Judge.

       Plaintiff Keli Murillo filed suit against defendant Washington Mutual Bank, F.A.

(“Washington Mutual” or “defendant”) alleging state-law claims for breach of contract and

negligence. Murillo appeals the district court’s grant of judgment on the pleadings. Upon review,

we affirm in part, reverse in part, and remand.

                                                  I.

       The facts alleged in Murillo’s complaint, as summarized by the district court, are as follows:

       Murillo is “in the business of investing in real property.” On November 30, 2007,
       Murillo executed a promissory note (“the November 30 loan”) with [Washington
       Mutual] in the amount of $87,750.00, secured by a mortgage on a property in
       Farmington Hills, Michigan. This was Murillo’s third investment property secured
       by a [Washington Mutual] mortgage. She owned other properties in Garden City and
No. 11-1908
Murillo v. Washington Mutual Bank, F.A.


       Detroit. The first monthly payment for the new loan, in the amount of $613.56, was
       due on January 1, 2008.

       Murillo concedes that she missed her very first payment on the November 30 loan.
       According to the complaint, she claims that her failure to pay was a result of
       [Washington Mutual]’s incompetence. Murillo resides in Pinckney, Michigan, where
       residential mail-delivery does not take place. Instead, she has to pick up all her mail
       from a P.O. Box in Lakeland, Michigan. [Washington Mutual] erroneously mailed
       payment statements and the signed closing package to Murillo’s home address, and
       she therefore failed to receive them.

       She did not attempt to make her first payment on the November 30 loan until
       March 11, 2008, when she sent a check in the amount of $1,392.40 to [Washington
       Mutual]. Murillo attempted to stay current on all three of her loans by submitting
       one check to [Washington Mutual] that listed the tracking numbers of the loans on
       the check in the bottom lefthand corner. The individual at [Washington Mutual]
       responsible for check processing could not understand from the check how Murillo
       wanted the funds disbursed, and credited the payment to only one of Murillo’s three
       loans, considering it a payment of both interest and principal. But even if the entire
       sum had been applied to the November 30 loan, the check would not have been
       sufficient to bring it current. By the time she mailed the check, Murillo owed three
       monthly payments to [Washington Mutual], totaling $1,840.68, not including late
       fees and penalties.

       [Washington Mutual] began sending notices to collection agencies about the default
       on the November 30 loan in April of 2008. Murillo’s loan payments in April and
       May of 2008 were returned to her. Washington Mutual acknowledged the mistake
       [with Murillo’s first payment check] and corrected the allocation of payments in July
       of 2008, but Murillo haggled with them for the next six months over the assessment
       of added interest, late fees, and costs due to her late payments.

       In January of 2009, Murillo entered a trial forbearance agreement with Chase (which,
       at this point, had succeeded Washington Mutual as the holder of the note) to prevent
       foreclosure. The parties never entered a formal forbearance agreement, and the
       temporary forbearance expired in April of 2009. Finally, in November of 2009,
       Chase initiated foreclosure proceedings, with a Sheriff’s sale taking place on
       February 9, 2010. Murillo was not sent formal notice that she failed to qualify for a
       permanent modification until after the completion of the foreclosure sale.



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Murillo v. Washington Mutual Bank, F.A.


Murillo v. Wash. Mut. Bank, F.A., No. 10-cv-13100, slip op. at 3-4 (E.D. Mich. June 28, 2011)

(citations omitted).

       On the basis of diversity jurisdiction, Murillo filed the present action on August 5, 2010,

alleging state-law claims for breach of contract and negligence. Thereafter, defendant moved for

judgment on the pleadings, which was granted. This timely appeal followed.

                                                 II.

       We review a district court’s grant of judgment on the pleadings under Federal Rule of Civil

Procedure 12(c) using the same de novo standard of review applicable to orders of dismissal under

Rule 12(b)(6). Tucker v. Middleburg-Legacy Place, LLC, 539 F.3d 545, 549 (6th Cir. 2008). “For

purposes of a motion for judgment on the pleadings, all well-pleaded material allegations of the

pleadings of the opposing party must be taken as true, and the motion may be granted only if the

moving party is nevertheless clearly entitled to judgment.” Id. (internal quotation marks and citation

omitted). Documents outside of the pleadings may be considered to the extent they are “incorporated

by reference into the complaint.” Weiner v. Klais & Co., 108 F.3d 86, 89 (6th Cir. 1997).

                                                 III.

       On appeal, Murillo does not address the dismissal of her negligence claim. Accordingly, any

such argument is waived. Miller v. Admin. Office of the Courts, 448 F.3d 887, 893 (6th Cir. 2006)

(holding that issues not raised in appellant’s brief are waived on appeal).




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Murillo v. Washington Mutual Bank, F.A.


                                                 IV.

        This leaves Murillo’s breach of contract claim.1 “In interpreting a contract, our obligation

is to determine the intent of the contracting parties.” Quality Prods. & Concepts Co. v. Nagel

Precision, Inc., 666 N.W.2d 251, 259 (Mich. 2003). The construction of clear and unambiguous

language is a question of law for the court. Id. Unambiguous language shall be enforced unless

contrary to public policy. Id.

        Murillo alleges that Washington Mutual breached the mortgage and note by: (1) failing to

apply her payments to the correct loans; (2) preventing her from making timely mortgage payments;

and (3) failing to send her closing package and other documents to the correct address. We address

each argument in turn.

        First, Washington Mutual did not breach any contractual provision in its processing of

Murillo’s late loan payments. With regard to payment processing, the mortgage provides in relevant

part:

        Lender may return any payment or partial payment if the payment or partial payments
        are insufficient to bring the Loan current. Lender may accept any payment or partial
        payment insufficient to bring the Loan current, without waiver of any rights
        hereunder or prejudice to its rights to refuse such payment or partial payments in the
        future, but Lender is not obligated to apply such payments at the time such payments


        1
        The mortgage and note are “governed by federal law and the law of the jurisdiction in which
the Property is located.” The property at issue is located in Michigan and the parties do not dispute
that Michigan law applies. While Murillo refers to the Real Estate Settlement Procedures Act
(“RESPA”), 12 U.S.C. § 2605, et seq., in her briefs on appeal, no RESPA claim is asserted in the
complaint. Indeed, while Murillo does claim that she failed to receive required information
regarding her loan, it appears she did not make a “qualified written request” for information as
required under RESPA. 12 U.S.C. § 2605(e)(1).

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Murillo v. Washington Mutual Bank, F.A.


       are accepted.

Accordingly, because none of Murillo’s payments were sufficient to bring her loan current,

Washington Mutual retained the discretion to apply the payments, hold the payments, or return them

just as it did. Rory v. Cont’l Ins. Co., 703 N.W.2d 23, 30 (Mich. 2005) (“A fundamental tenet of our

jurisprudence is that unambiguous contracts are not open to judicial construction and must be

enforced as written.”).

       Murillo asserts that her first two payments, if combined, were enough to bring her loan

current. This argument fails. First, because Murillo failed to make this argument before the district

court, it is forfeited on appeal. United States v. Ellison, 462 F.3d 557, 560 (6th Cir. 2006) (“[T]his

court generally will not consider an argument not raised in the district court and presented for the

first time on appeal.”). Second, the pleadings and the documents incorporated therein clearly

demonstrate that Murillo instructed the March 11 check to be disbursed amongst all three of her

Washington Mutual loans. Murillo admits this fact. Accordingly, Washington Mutual did not

breach the mortgage and note in applying Murillo’s loan payments.

       Next, Murillo asserts that Washington Mutual breached the mortgage and note by preventing

her from making payments. Specifically, Murillo asserts that she was unable to make timely

payments because she never received payment statements or a copy of the closing documents. A

“negative duty is imposed upon a promisor not to prevent performance of any condition qualifying

its promise, and a contract is breached when one party’s performance is hindered or rendered

impossible by the other.” 23 Williston on Contracts § 63:26 (4th ed. 2011); see also Kiff


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Murillo v. Washington Mutual Bank, F.A.


Contractors, Inc. v. Beeman, 159 N.W.2d 144, 146 (Mich. Ct. App. 1968) (“The general rule is that

a party to a contract cannot prevent, or render impossible, performance by the other party and still

recover damages for nonperformance.”).

       Murillo asserts that she contacted Washington Mutual on several occasions to obtain her

closing package, but was unsuccessful. Nevertheless, she admits that she was able to obtain the

information she needed to make payments from the title company. Moreover, Murillo had two other

loans with Washington Mutual, and thus had actual knowledge of where to send payments. Indeed,

it is undisputed that the payments on all three loans were to be sent to the same address. Finally,

Murillo signed the mortgage and note, acknowledging her responsibility to make periodic payments

at certain times to a certain address. Watts v. Polaczyk, 619 N.W.2d 714, 717 (Mich. Ct. App. 2000)

(“Michigan law presumes that one who signs a written agreement knows the nature of the instrument

so executed and understands its contents.”); Stopczynski v. Ford Motor Co., 503 N.W.2d 912, 913

(Mich. Ct. App. 1993) (per curiam) (“[O]ne who signs a contract cannot seek to avoid it on the

[basis] that he did not read it or that he supposed that it was different in its terms.”). Accordingly,

Washington Mutual did not prevent Murillo from making timely payments.

       Finally, Murillo asserts that Washington Mutual breached the mortgage contract by failing

to provide her with the closing documents. Such a failure would amount to breach. The mortgage

provides that “Borrower shall be given one copy of the Note and of this Security Instrument.”

Accordingly, if Washington Mutual failed to provide Murillo with such documents, Washington




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Murillo v. Washington Mutual Bank, F.A.


Mutual breached this express and unambiguous requirement of the mortgage contract.2

        In addition, Murillo asserts that she did not receive other notices as required under the

mortgage. With regard to notice, the mortgage provides:

        All notices given by Borrower or Lender in connection with this Security Instrument
        must be in writing. Any notice to Borrower in connection with this Security
        Instrument shall be deemed to have been given to Borrower when mailed by first
        class mail or when actually delivered to Borrower’s notice address if sent by other
        means.

As a result of insufficient notice, Murillo asserts that she was not informed of the method in which

her late loan payments were being processed, and that as a result, she continued to unknowingly be

in default.3

        Whether Washington Mutual failed to provide required notices and closing documents, and

the ramifications of such failure, are questions of fact to be addressed at a later stage of this

litigation. McManamom v. Redford Twp., 730 N.W.2d 757, 763-64 (Mich. Ct. App. 2006)

(“Damages are an issue of fact, and questions of fact are, of course, generally decided by the trier of

fact--in this case, the jury.”); Lansing Pavilion, L.L.C. v. Eastwood, L.L.C., No. 265970, 2006 WL

2271348, at *2 (Mich. Ct. App. Aug. 8, 2006) (per curiam) (“[T]he issue of causation is a question


        2
        The mortgage did not provide a time by which the mortgage and note documents were to
be provided to Murillo. Accordingly, it is presumed that such documents were to be provided within
a reasonable period of time. Kiff, 159 N.W.2d at 146. The pleadings do not indicate when, if ever,
Murillo received a copy of the mortgage and note from defendant.
        3
         In making her arguments regarding notice, Murillo relies in substantial part on Wanger v.
EMC Mortgage Corp., 103 Cal. App. 4th 1125 (Cal. Ct. App. 2002). That case, however, involves
the failure of a mortgage servicer to provide notice of a transfer as required under RESPA. Id. at
1133-37. As noted above, Murillo asserts no RESPA claim in her complaint.

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No. 11-1908
Murillo v. Washington Mutual Bank, F.A.


of fact for the jury.”). Accordingly, we reverse the dismissal of Murillo’s breach of contract claim

based upon defendant’s alleged failure to provide her with various documents.

                                                V.

       For the foregoing reasons, we affirm in part, reverse in part, and remand for further

proceedings consistent with this opinion.




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