Clarence Mitchell, et al. v. Rushmore Loan Management Services, et al.

Plaintiffs brought suit alleging breach of contract and the covenant of good faith and fair
dealing against the mortgage servicer of their loan. The mortgage servicer sought summary
judgment on two grounds: (1) an absence of privity and (2) its actions did not violate any
provision of the contract. The Plaintiffs conceded that the mortgage servicer’s actions did
not violate any specific term of the contract and indicated their suit exclusively relied on a
claim predicated upon breach of the covenant of good faith and fair dealing. The trial court
granted summary judgment in favor of the mortgage servicer. The trial court
acknowledged but declined to rule upon the mortgage servicer’s privity argument and
instead granted summary judgment based on its conclusion that a breach of the covenant
of good faith and fair dealing cannot occur in the absence of a breach of a specific term of
the contract. The Plaintiffs appealed. We affirm the trial court’s grant of summary
judgment on the ground that there is no privity of contract between the Plaintiffs and the
mortgage servicer.