Boyce v. Amerihome, Inc. and Planetary Bank N.A.

Ned and Charlotte Boyce (defendants) took out a mortgage from Wonder Mortgage Company, which sold the loan to Maximum Finance Company, which in turn sold it into a securitization trust for which Planetary Bank N.A. (plaintiff) served as trustee under a pooling and servicing agreement (PSA). Broker Freddie Farmer told the Boyces their rate would rise only if a Treasury index rose, but the actual note set the rate by adding seven points to the current index each year; when the index later fell to 0.62 percent, their rate still jumped to 7.75 percent. After the Boyces defaulted, Amerihome, Inc. (plaintiff), Planetary's servicer, began foreclosure. The Boyces argued Farmer's misrepresentation was fraud, and separately that Amerihome's admitted breach of the PSA voided the transfer to Planetary. The trial court denied the Boyces summary judgment, and they appealed.