The Supreme Court of Washington recently held that state contract and consumer protection claims regarding fax and notary fees charged by a federal savings bank were not preempted under HOLA. A copy of the opinion is attached.
To reconvey title, the defendant federal savings bank charged fax and notary fees that the borrowers argue were not permitted by the deed of trust, unjustly enriched the defendant federal savings bank, and violated the state UDAP statute. The trial court held state laws supporting the borrower's contract and consumer protection claims were preempted by federal regulation under the Home Owners Loan Act (HOLA). The Court of Appeals affirmed.
However, the Washington Supreme Court held that the state laws are generally applicable with only an incidental effect on the federal savings bank's lending operations, thus reversed and remanded the case to the trial court for further proceedings.
Ralph T. Wutscher
Kahrl Wutscher LLP
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