Aniel v. E*trade Bank

• Decision Date: 12 March 2015
• Docket Number: A141246
• Court: California Court of Appeals Court of Appeals
• Parties: ERLINDA ABIBAS ANIEL, Plaintiff and Appellant, v. E*TRADE BANK et al., Defendants and Respondents.

ERLINDA ABIBAS ANIEL, Plaintiff and Appellant, v. E*TRADE BANK et al., Defendants and Respondents.

A141246

COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION TWO

March 12, 2015

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(San Mateo County Super. Ct. No. CIV514402)

Plaintiff Erlinda Abibas Aniel appeals from the judgment of dismissal entered following the sustaining of a general demurrer to her second amended complaint. Plaintiff contends that three of her causes of action were sufficient to withstand the demurrer and stated claims for relief for the allegedly illegal practices that attended the non-judicial repossession of improved real property in Daly City. We conclude that the trial court correctly determined that each of the causes of action was legally deficient, and we affirm.

BACKGROUND

The operative pleading, plaintiff's 41-page verified second amended complaint purported to allege the following seven causes of action: "(1) Wrongful Foreclosure (Violation of Civil Code § 2924) (2) Set Aside Trustee's And/Or Cancel Trustee's Sale (3) Declaratory Relief (4) Quiet Title (5) Fraudulent Concealment (6) Fraud (7) Violationof the Unfair Competition Law (Cal. Bus. & Prof. Code §§ 17200 et seq.)."¹ However, on appeal plaintiff contends only that she stated sufficient claims for wrongful foreclosure, fraud, and violation of the Unfair Competition law (UCL). Moreover, the complaint named as defendants entities that are not parties to this appeal. The respondents here are the parties who interposed the general demurrer and who are covered by the judgment, namely, E*Trade Bank, E*Trade Financial Corporation, and Bayview Loan Servicing (and which are collectively referred to hereafter as E*Trade where appropriate). Therefore, the following recitation does not—except when necessary to maintain coherency—include allegations respecting either the causes of action or the parties not at issue on this appeal.

The Complaint

In 2000, plaintiff purchased improved real property in Daly City. Plaintiff refinanced the property in 2004. The details were alleged as follows:

"On or around February 23, 2004, Plaintiff . . . signed a Promissory Note" in favor of the lender, Countrywide Homes Loans, Inc. (Countrywide). At the same time plaintiff also "executed a Deed of Trust, a security instrument for the Promissory Note. The Deed of Trust identified Countrywide as the Lender. The Deed of Trust identified MERS,²acting solely as the nominee for the Lender, the Lender's successors, and assigns as the Beneficiary. The Deed of Trust identified CTC Real Estate Services [CTC] as the Trustee. The Deed of Trust was recorded in the County of San Mateo on February 27, 2004. . . . [¶] Based on information and belief, sometime after the Promissory Note was executed, Countrywide sold its interest in the Promissory Note and Deed of Trust to the secondary market, and to a securitized trust.³ Based on information and belief, Countrywide was paid off by Fannie Mae with a commission of around 2% of$497,000.00, which was $9,940.00, and retained the loan servicing rights of Plaintiff's loan. However, Countrywide failed to execute the appropriate Assignment of Deed of Trust, and Endorsement of the Note that was required to secure the subsequent purchaser's secured interest in the Plaintiff's loan. . . . [¶] Based on information and belief, when Countrywide dissolved, Plaintiff's obligations on the loan were canceled because Countrywide did not grant, assign, or transfer any beneficial interest in the Note or the Deed to any other Defendant or third party prior to dissolving and selling its servicing rights to Defendant Bank of America. From this point on, Plaintiff's obligation under the loan was canceled."

Commencing in August 2008, plaintiff unsuccessfully negotiated with Countrywide for a "loan modification" after being told by Countrywide representatives "to stop making payments" because "she had to be in default in order to create a 'hardship'. . . which was necessary to be considered and approved for a loan modification." "In reliance of Countrywide representatives' advice, Plaintiff chose to stop making mortgage payments for the months of August 2008, September 2008 and October 2008." Plaintiff was this thus "tricked . . . into defaulting on her loan." Plaintiff continued in discussion with Countrywide representatives until February 2009, when she filed for bankruptcy protection. At this time plaintiff learned that Bank of America (acting through BAC Home Loan Servicing, a subsidiary) was involved, apparently as the current "servicer on behalf of the 'holder of Plaintiff's note,' " and that her loan "was seriously delinquent." "On December 02, 2010, the Bankruptcy Court discharged Plaintiff's debt on the subject property."

"On January 18, 2011, February 25, 2011, March 30, 2011, and April 28, 2011, Plaintiff received statements from Bank of America Home Loans, which always purported that BAC was the servicer of Plaintiff's note." "On or around June 16, 2011. . . MERS executed an Assignment of the Deed of Trust, which purports that MERS, as beneficiary, assigned, for value, beneficial interest in the deed of trust to E*Trade. The document was recorded on June 22, 2011." "This purported 'transaction' took place after Countrywide was dissolved and no longer in business. Also, the document fails todisclose that MERS was acting as the nominee for Countrywide, and not as a beneficiary under the Deed of Trust."

"Based on this information and belief, Plaintiff alleges that the Assignment of Deed of Trust contained false information in that MERS never assigned, transferred, or granted, beneficial interest in the Deed of Trust to E*Trade. Also, based on information and belief, Defendant E*Trade never purchased for value beneficial interest in the Deed of Trust. This lack of consideration in the Assignment of the Deed of Trust makes the Assignment VOID, as a matter of law, because the transaction never occurred. As a result, E*Trade did not have an enforceable security instrument with any legal authority and right to exercise the Power of Sale clause in the Plaintiff's Deed of Trust. . . . Also, based on information and belief, the document was fabricated through the use of Robo-Signing . . . . Plaintiff believes and alleges that this process was used to fabricate . . . a transaction that never occurred."

Plaintiff further alleged that she denies owing anything to either Bank of America or E*Trade "because the loan has been paid off by the secondary market investor or institutional investors such as Fannie Mae in 2004 right after the escrow was closed." "Based on information and belief, when Bank of America assumed all of the bad assets of Countrywide in 2008, Bank of America, who had knowledge of Countrywide's defaulted loans and that they sold this loan in the secondary market and likely to a Securitized Trust, created a false accounting of Plaintiff's loans and continued to create false monthly statements to create an illusionary amount that Plaintiff owed to deceive the Plaintiff."

On or around December 30, 2011, Asset Foreclosure Services recorded "a fraudulent Notice of Default" that was executed by an individual who "is a notorious robo-signer . . . who had no personal knowledge of the contents or consequences of the documents and did not have the authority to execute such a document." "Defendants cannot provide any evidence . . . that [quoting from the Notice of Default] the 'present beneficiary under such Deed of Trust has executed and delivered to said trustee, a written declaration and Demand for Sale. Because none of the Defendants are the present beneficiaries under the Deed of Trust, no such default was ever demanded on the subjectproperty. Based on this information and belief, the Notice of Default is VOID and never existed." The execution and recordation of the assignment of the deed of trust, the substitution of trustee, the notice of trustee's sale, and the trustee's deed upon sale all suffer from the same tainted heritage.

Plaintiff alleged that she tried to warn off potential buyers at the trustee's sale held on June 11, 2012, when the property was purchased by Tseng Investment.

Plaintiff incorporated all of these allegations (111 paragraphs of them) in her cause of action for "Wrongful Foreclosure (Violation of Civil Code § 2924)." Based on their having "fraudulently executed and recorded documents in order to foreclose the property," plaintiff alleged that "defendants do not hold any legal, equitable, or enforceable interest in the Deed of Trust and are not operating under a valid power of sale."

"The foreclosure was wrongful for each of the following reasons, independent of any of the other following reasons: (1) because Plaintiff's obligation under the Note was canceled prior to Defendants acquiring interest in the canceled debt, (2) because Defendants do not own the Note or an enforceable, legal, equitable, interest in the Deed and do not have a power of sale with respect to the Note and Deed, (3) because Defendants cannot surmount their burden of demonstrating they are the beneficiary under the Deed of Trust, or have a power of sale with respect thereto, (4) Defendants used Robo-Signers to execute foreclosure documents, (5) Defendant falsely identified E*Trade as the owner of the loan at the time the Notice of Default was executed and recorded, (6) falsely claiming MERS transferred beneficial interest in the Deed of Trust to E*Trade after the Notice of Default was executed and recorded, (7) failing to respond to Plaintiff s debt validation request after receiving the Notice of Default, (8) purporting an inaccurate...