The Georgia Supreme Court at its 10 a.m. session Tuesday will hear a Harris County couple's claim that their lawsuit against a home-loan company should be a class-action suit.
The case of Schorr v. Countrywide Home Loans Inc. involves Bradley and Lori Schorr, who claim Countrywide broke the law by not canceling their security deed once they paid off their loan.
According to the court, the Schorrs paid off their loan in July 2003, and in writing told Countrywide to cancel the security deed. Court officials say Georgia law requires lenders to cancel such deeds within 60 days after a loan's paid off. Borrowers are entitled to $500 in damages if lenders fail to do so, but the law states that lenders are not liable for damages “unless and until a written demand for the liquidated damages is made.” When Countrywide failed to cancel the deed, the Schorrs in November 2003 sent a written demand for $500. Countrywide did not pay, so the Schorrs in February 2007 filed a class-action lawsuit in U.S. District Court for the Middle District of Georgia. They wanted to represent all Georgia homeowners who in the past 20 years had paid off a Countrywide mortgage without their security deeds being canceled.
But other homeowners made no written demand for damages before the Schorrs filed their lawsuit, so Countrywide moved to dismiss other claims. The Schorrs then requested that the federal court ask the state Supreme Court whether the Schorrs' written demand for damages under Georgia law would serve for the entire class. The federal court decided not to rule until the state Supreme Court decides.
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Countrywide has not tried to get the Schorrs’ claim dismissed. It argues only that other borrowers did not send written demands for damages as the law requires.