336 P.3d 1142 (Wash. 2014), 89132-0, Lyons v. U.S. Bank NA

Docket Nº:89132-0
Citation:336 P.3d 1142, 181 Wn.2d 775
Opinion Judge:Fairhurst, J.
Party Name:Winnie Lyons, Appellant , v. U.S. Bank NA, as Trustee for Stanwich Mortgage Loan Trust Series 2012-3, by Carrington Mortgage Services, LLC, et al., Defendants, Northwest Trustee Services, Inc., as Trustee, Respondent
Attorney:Mary C. Anderson (of Guidance To Justice Law Firm Inc. ), and Melissa A. Huelsman (of Law Offices of Melissa A. Huelsman ), for appellant. Joshua S. Schaer (of Routh Crabtree Olsen PS ), for respondent. Ann T. Marshall and Katie A. Axtell on behalf of United Trustees Association, amicus curiae. S...
Judge Panel:AUTHOR: Justice Mary E. Fairhurst. WE CONCUR: Chief Justice Barbara A. Madsen, Justice Charles W. Johnson, Justice Susan Owens, Justice Debra L. Stephens, Justice Charles K. Wiggins, Justice Steven C. Gonz
Case Date:October 30, 2014
Court:Supreme Court of Washington

Page 1142

336 P.3d 1142 (Wash. 2014)

181 Wn.2d 775

Winnie Lyons, Appellant ,

v.

U.S. Bank NA, as Trustee for Stanwich Mortgage Loan Trust Series 2012-3, by Carrington Mortgage Services, LLC, et al., Defendants, Northwest Trustee Services, Inc., as Trustee, Respondent

No. 89132-0

Supreme Court of Washington, En Banc

October 30, 2014

Argued May 27, 2014

Page 1143

[Copyrighted Material Omitted]

Page 1144

Appeal from King County Superior Court 12-2-21502-2 Honorable Jay V. White.

Mary C. Anderson (of Guidance To Justice Law Firm Inc. ), and Melissa A. Huelsman (of Law Offices of Melissa A. Huelsman ), for appellant.

Joshua S. Schaer (of Routh Crabtree Olsen PS ), for respondent.

Ann T. Marshall and Katie A. Axtell on behalf of United Trustees Association, amicus curiae.

Sheila M. O'Sullivan and Audrey L. Udashen on behalf of Northwest Consumer Law Center, amicus curiae.

Eulalia Sotelo, Lisa M. von Biela, and Thomas W. McKay on behalf of Northwest Justice Project, amicus curiae.

John M. Geyman on behalf of Columbia Legal Services, amicus curiae.

Kimberlee L. Gunning and Shannon E. Smith, Assistants Attorney General, on behalf of the Office of the Attorney General, amicus curiae.

AUTHOR: Justice Mary E. Fairhurst. WE CONCUR: Chief Justice Barbara A. Madsen, Justice Charles W. Johnson, Justice Susan Owens, Justice Debra L. Stephens, Justice Charles K. Wiggins, Justice Steven C. González, Justice Sheryl Gordon McCloud, Justice Mary I. Yu.

OPINION

Page 1145

Fairhurst, J.

[181 Wn.2d 779] ¶ 1 Winnie Lyons brought suit against Northwest Trustee Services Inc. (NWTS) based on its conduct as the trustee during foreclosure. Lyons alleged violations of the deeds of trust act (DTA), chapter 61.24 RCW; violations of the Consumer Protection Act (CPA), chapter 19.86 RCW; and the intentional infliction of emotional distress. First, this case asks whether a plaintiff can even bring a cause of action for damages under the DTA or the CPA in the absence of an actual sale of the property. It then asks whether the trial court erred by granting summary judgment in favor of NWTS on all three claims. We affirm the trial court's grant of summary judgment on the DTA and the intentional infliction of emotional distress claims, but we reverse and remand the CPA claim to the trial court.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

¶ 2 In August 2007, Winnie Lyons signed a promissory note secured by a deed of trust encumbering real property in Burien, Washington. The Burien property is Lyons' primary residence and also the location from which she operates an adult family home (AFH), 1 her sole source of [181 Wn.2d 780] income. Wells Fargo Bank NA was identified on the deed of trust as the lender and beneficiary. Northwest Trustee Services LLC was identified as the trustee. The deed of trust was recorded on August 31, 2007 in King County. In early 2009, Northwest Trustee Services LLC became NWTS and Wells Fargo recorded an appointment of successor trustee naming NWTS as the successor trustee.

¶ 3 In October 2009, an employee of Wells Fargo executed a beneficiary declaration identifying Wells Fargo as trustee for Soundview Home Loan Trust 2006. This beneficiary declaration asserted, " Wells Fargo Bank, NA, as Trustee for Soundview Home Loan Trust 2006-WFI is the actual holder of the promissory note or other obligation evidencing the above-referenced loan or has requisite authority under RCW 62A.3-301 to enforce said obligation." Clerk's Papers (CP) at 120. In June 2010, another beneficiary declaration was executed by an employee of Wells Fargo. It read, " Wells Fargo Bank, NA, is the actual holder of the promissory note or other obligation evidencing the above-referenced loan or has requisite authority under RCW 62A.3-301 to enforce said obligation." CP at 118.

¶ 4 In October 2011, Lyons filed bankruptcy, and in January 2012, she applied for a loan modification with Wells Fargo. On March 30, 2012, while Lyons was waiting for

Page 1146

a response regarding her application for a modification, she received a notice of trustee's sale from NWTS informing her that her property was scheduled to be sold on July 6, 2012. On April 5, 2012, Wells Fargo told Lyons' attorney that the in-house modification had been approved. On April 19, 2012, Lyons received the letter confirming the modification. The terms required her to pay $ 10,000 by May 1, 2012. Wells Fargo informed Lyons they would discontinue the sale upon receipt of this payment. She paid this amount to Wells Fargo as required.

[181 Wn.2d 781] ¶ 5 However, on March 29, 2012, Wells Fargo had sold Lyons' loan to U.S. Bank National Association as trustee for Stanwich Mortgage Loan Trust Series 2012-3 with Carrington Mortgage Services LLC as the new servicer of the loan. This was to become effective on May 1, 2012. NWTS received notice of the sale and service release on April 12, 2012. Lyons received notice of this sale on April 26, 2012.

¶ 6 On April 26, 2012, Lyons' attorney spoke with a representative of NWTS to inform it that Wells Fargo no longer had any beneficial interest in the loan after the sale, that Carrington was the new servicer of the loan, and that Lyons had received a loan modification so she was no longer in default. On June 11, 2012, Lyons' attorney again called NWTS to inform them of the loan modification and the sale of the loan. An NWTS employee informed her that Carrington had directed NWTS to continue with the foreclosure sale as scheduled. On June 14, 2012, Lyons' attorney called Carrington and an employee indicated that Carrington did not show the property in foreclosure status. Another employee further indicated that Carrington had not told NWTS to go forward with the sale. Lyons' attorney then sent a cease and desist letter to NWTS and Carrington.

¶ 7 On June 18, 2012, Lyons' attorney followed up with NWTS. NWTS acknowledged receipt and informed her the sale was still on but that the matter had been referred to an attorney for NWTS. On June 19, 2012, the attorney for NWTS informed Lyons' attorney that he needed to do his due diligence. Lyons' attorney again spoke with NWTS' attorney on June 21, 2012. NWTS' attorney refused to discontinue the sale, and Lyons' attorney filed the complaint. At the end of the day on June 21, 2012, NWTS [181 Wn.2d 782] executed and recorded a notice of discontinuance of the trustee's sale. 2

¶ 8 Lyons alleges that this situation has had serious emotional and economic impacts on her. In March 2012, Lyons arrived home to be handed the notice of trustee's sale by a family member of one of her full pay AFH clients. In addition to the sense of humiliation Lyons felt, this client moved out approximately two weeks later because of concern that Lyons was going to lose her business and her home. Before leaving, this client shared her belief that the home was going to be foreclosed on with other AFH clients, some of whom also moved shortly thereafter. The AFH business is her primary source of income, and the loss of clients directly impacted her financially. In her declaration, Lyons asserts that thereafter she struggled with day-to-day tasks and felt hopeless. She began counseling with the pastor of her church. Her pastor said that previously Lyons was a very positive woman with a drive to succeed, but since the pending foreclosure she was fearful and depressed. Lyons asserts that she experienced constant nausea from the stress and continuously worried about losing her business and the subsequent homelessness of herself, her son, and the elderly clients she cared for.

¶ 9 NWTS moved for summary judgment. After argument, the court granted the motion for summary judgment as to all claims against NWTS. Subsequently, Lyons and the remaining defendants (Stanwich, Carrington, and Wells Fargo) entered a stipulated order of dismissal. Lyons' motion for reconsideration of the order of summary judgment was denied. We granted Lyons' petition for direct review.

Page 1147

[181 Wn.2d 783] II. ISSUES PRESENTED

¶ 10 1. If a nonjudicial foreclosure sale does not happen, can a plaintiff bring a claim for damages under the DTA or the CPA?

¶ 11 2. Was the grant of summary judgment against Lyons on her CPA claim improper?

¶ 12 3. Was the grant of summary judgment against Lyons on her intentional infliction of emotional distress claim improper?

III. ANALYSIS

¶ 13 Lyons alleges a range of errors by the trial court that resulted from it granting summary judgment in favor of NWTS. We review questions of law and summary judgment rulings de novo. Dreiling v. Jain, 151 Wn.2d 900, 908, 93 P.3d 861 (2004); Reid v. Pierce County, 136 Wn.2d 195, 201, 961 P.2d 333 (1998). " In reviewing an order of summary judgment, we engage in the same inquiry as a trial court." Reid, 136 Wn.2d at 201. We interpret all the facts and inferences therefrom in favor of Lyons, the nonmoving party. Id. Summary judgment is appropriate only if the record demonstrates there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Id.

¶ 14 Lyons alleges three causes of action against NWTS--one under the DTA, one under the CPA, and one for intentional infliction of emotional distress. All of these claims are supported by the same underlying conduct that Lyons alleges involves a violation of RCW 61.24.030(7) in relation to the beneficiary declaration and a breach of the duty of good faith under RCW 61.24.010(4). The trial court focused on the issue of whether Lyons could bring a claim for damages under the DTA in the absence of a trustee's sale, and there was almost no discussion of the CPA or the [181 Wn.2d 784] intentional infliction of emotional distress claims during argument on the summary judgment motion. Yet, the court granted NWTS' motion on all of these claims. We begin by addressing the causes of action under the DTA and the CPA, including Lyons' particular...

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107 practice notes
  • 352 P.3d 830 (Wash.App. Div. 3 2015), 32474-5-III, Merry v. Northwest Trustee Services, Inc.
    • United States
    • Washington Court of Appeals of Washington
    • 4 Junio 2015
    ...basis on which waiver would not apply. We review questions of law and summary judgment rulings de novo. Lyons v. U.S. Bank Nat'l Ass'n, 181 Wn.2d 775, 783, 336 P.3d 1142 (2014). Failure to seek the presale injunction authorized by RCW 61.24.130 can operate as a waiver [¶21] In obtaining a l......
  • 372 P.3d 127 (Wash.App. Div. 3 2016), 32816-3-III, Blair v. Northwest Trustee Services, Inc.
    • United States
    • Washington Court of Appeals of Washington
    • 17 Marzo 2016
    ...[¶11] This court reviews an order granting summary judgment de novo. Lyons v. U.S. Bank Nat'l Ass'n, 181 Wn.2d 775, 783, 336 P.3d 1142 (2014). Under de novo review, this court engages in the same inquiry as the trial court, viewing the facts and all reasonable infer......
  • 376 P.3d 1127 (Wash.App. Div. 2 2016), 46347-4-II, McCarthy v. Clark County
    • United States
    • Washington Court of Appeals of Washington
    • 12 Abril 2016
    ...a trial court's order granting summary judgment de novo. Lyons v. U.S. Bank Nat'l Ass'n 181 Wn.2d 775, 783, [193 Wn.App. 328] 336 P.3d 1142 (2014). We review the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in that p......
  • Khalid v. Citrix Systems, Inc., 120720 WACA, 79143-5-I
    • United States
    • Washington Court of Appeals of Washington
    • 7 Diciembre 2020
    ...CPA findings, for example, in the context of deeds of trust, Lyons v. U.S. Bank Nat'l Ass'n, 181 Wn.2d 775, 786 n. 5, 336 P.3d 1142 (2014) (RCW 61.24.135 lists some per se violations of the Deed of Trust Act that automatically constitute unfair or deceptive practice......
  • Free signup to view additional results
107 cases
  • 352 P.3d 830 (Wash.App. Div. 3 2015), 32474-5-III, Merry v. Northwest Trustee Services, Inc.
    • United States
    • Washington Court of Appeals of Washington
    • 4 Junio 2015
    ...basis on which waiver would not apply. We review questions of law and summary judgment rulings de novo. Lyons v. U.S. Bank Nat'l Ass'n, 181 Wn.2d 775, 783, 336 P.3d 1142 (2014). Failure to seek the presale injunction authorized by RCW 61.24.130 can operate as a waiver [¶21] In obtaining a l......
  • 372 P.3d 127 (Wash.App. Div. 3 2016), 32816-3-III, Blair v. Northwest Trustee Services, Inc.
    • United States
    • Washington Court of Appeals of Washington
    • 17 Marzo 2016
    ...[¶11] This court reviews an order granting summary judgment de novo. Lyons v. U.S. Bank Nat'l Ass'n, 181 Wn.2d 775, 783, 336 P.3d 1142 (2014). Under de novo review, this court engages in the same inquiry as the trial court, viewing the facts and all reasonable infer......
  • 376 P.3d 1127 (Wash.App. Div. 2 2016), 46347-4-II, McCarthy v. Clark County
    • United States
    • Washington Court of Appeals of Washington
    • 12 Abril 2016
    ...a trial court's order granting summary judgment de novo. Lyons v. U.S. Bank Nat'l Ass'n 181 Wn.2d 775, 783, [193 Wn.App. 328] 336 P.3d 1142 (2014). We review the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in that p......
  • Khalid v. Citrix Systems, Inc., 120720 WACA, 79143-5-I
    • United States
    • Washington Court of Appeals of Washington
    • 7 Diciembre 2020
    ...CPA findings, for example, in the context of deeds of trust, Lyons v. U.S. Bank Nat'l Ass'n, 181 Wn.2d 775, 786 n. 5, 336 P.3d 1142 (2014) (RCW 61.24.135 lists some per se violations of the Deed of Trust Act that automatically constitute unfair or deceptive practice......
  • Free signup to view additional results