Hill v. Fay Servicing, LLC

• Decision Date: 01 December 2021
• Docket Number: B302672
• Court: California Court of Appeals Court of Appeals
• Parties: JOHN HILL, Plaintiff and Appellant, v. FAY SERVICING, LLC, Defendant and Respondent.

JOHN HILL, Plaintiff and Appellant, v. FAY SERVICING, LLC, Defendant and Respondent.

B302672

California Court of Appeals, Second District, Third Division

December 1, 2021

NOT TO BE PUBLISHED

APPEAL from a judgment of the Superior Court of Los Angeles County Super. Ct. No. 19TRCV00317. Ramona G. See, Judge. Affirmed.

John Hill, in pro. per.; Yesk Law and Michael Yesk for Plaintiff and Appellant.

Wright, Finlay & Zak and Jonathan D. Fink, for Defendant and Respondent.

EGERTON, J.

John Hill filed a complaint against Fay Servicing, LLC (Fay) alleging it demanded repayment of a loan and initiated foreclosure on his property without authority. The trial court sustained Fay's demurrer without leave to amend after finding Hill failed to allege any facts showing Fay lacked the requisite authority. Hill appealed, and we affirm.

FACTUAL AND PROCEDURAL BACKGROUND

Consistent with the applicable standard of review, we draw our statement of facts from the allegations in Hill's complaint and matters properly subject to judicial notice. (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.) "[W]e treat as true all material facts properly pleaded but not contentions, deductions or conclusions of fact or law." (Freeman v. San Diego Assn. of Realtors (1999) 77 Cal.App.4th 171, 178, fn. 3.)

In 2006, Hill executed a promissory note (the Note) in connection with a $920, 000 loan. The Note was secured by a deed of trust encumbering his property (the Deed of Trust). Hill defaulted on the loan in 2008.

In 2014, Bank of America executed an assignment of deed of trust, purporting to "grant, sell, assign, transfer and convey unto" Ventures Trust^[1] "all beneficial interest under [the 2006] Deed of Trust . . . together with the note(s) and obligations therein described and the money due and to become due thereon with interest and all rights accrued or to accrue under said Deed of Trust."

In August 2016, the Law Offices of Les Zieve recorded a notice of default and election to sell under deed of trust.

Fay became the servicer on Hill's loan in March 2017. Sometime later, Fay informed Hill he owed more than $800, 000 in overdue payments and attorney fees. In February 2019, the Law Offices of Les Zieve recorded a notice of trustee's sale.

Hill filed a complaint against Fay in April 2019. In the operative first amended complaint (FAC), Hill alleged the 2014 assignment of the Deed of Trust to Ventures Trust is void because there was no corresponding assignment of the Note. As a result, he alleged, Fay did not represent the true holder of the Note and beneficiary under the Deed of Trust, meaning it lacked authority to demand payment on the loan and initiate foreclosure of his property.^[2]

Based on the above allegations, Hill asserted causes of action for violations of the Rosenthal Fair Debt Collection Practices Act (Civ. Code, § 1788 et seq.; the Rosenthal Act) various provisions of the Homeowner Bill of Rights (Civ Code, §§ 2924.17, 2924, subd. (a)(6); HBOR), and the Unfair Competition Law (Bus. & Prof. Code, § 17200; UCL). In relief, he sought damages, an injunction requiring Fay to remove any instrument that could cloud title, and a declaration that Fay lacks any legally cognizable rights to the property or debt. Hill attached the assignment of the Deed of Trust and several other documents to the FAC.

Fay filed a demurrer to the FAC on the basis that it failed to state sufficient facts to support any cause of action. Among other things, Fay argued the entire FAC constituted an improper challenge to its authority to foreclose the property, and Hill failed to allege sufficient facts showing the assignment of the Deed of Trust is void. Fay alternatively argued it is not a debt collector and its actions did not amount to debt collection for purposes of the Rosenthal Act. In support of its demurrer, Fay requested the court take judicial notice of the Deed of Trust, the assignment of the Deed of Trust, and the two foreclosure notices referenced in the FAC.

In opposition to the demurrer, Hill maintained Fay qualified as a debt collector under the Rosenthal Act, and the nonjudicial foreclosure constituted an attempt to collect a debt. Hill further asserted the assignment of the Deed of Trust is void because it was executed by his former mortgage servicer (Bank of America) rather than the beneficiary of his debt obligation. Hill opposed Fay's request for judicial notice on the basis that the contents of the documents were disputed and constituted inadmissible hearsay.

The court granted Fay's request for judicial notice and sustained the demurrer without leave to amend. On the first cause of action-for violations of the Rosenthal Act-the court determined Fay, as a mortgage servicer, could qualify as a debt collector. Nonetheless, it concluded Hill failed to allege "facts demonstrating a violation under the [Rosenthal] Act. Instead, the alleged violation simply consists of [Hill's] conclusory and unsupported opinion that [Fay] lacked authority to pursue payment for the debt, and, then, lacked authority to ultimately foreclose."

On the second cause of action-for violations of the HBOR -the court found Hill's claims were based on "the fundamentally flawed conclusory allegations that Defendant lacked the authority to foreclose, . . . and [Hill] is not entitled to injunctive relief under Section 2924(a)(6)."

Finally, on the third cause of action-for violations of the UCL-the court found Hill failed to "allege facts . . . show[ing] a causal link between his economic injury and [Fay's] alleged wrongful acts." The court also noted that where the underlying claims are deficient, an unfair competition claim also fails.

The court entered judgment of dismissal. Hill appealed.

DISCUSSION

1. Hill's Notice of Appeal is Timely

Fay urges us to dismiss the appeal because Hill failed to file a timely notice of appeal. Generally, a party must file a notice of appeal within 60 days after being served with the notice of entry of judgment. (Cal. Rules of Court, rule 8.104(a)(1)(A).) Failure to do so deprives the reviewing court of jurisdiction to hear the appeal. (Ventura Coastal, LLC v. Occupational Safety & Health Appeals Bd. (2020) 58 Cal.App.5th 1, 36.)

Hill was served the notice of entry of judgment on September 25, 2019, making November 25, 2019 the deadline to file a notice of appeal. The notice of appeal in the record indicates the superior court clerk filed it on November 26, 2019, a day after the deadline. As such, it would appear to be untimely.

However, according to a document entitled Notice of Court Rejection of Electronic Filing, on November 22, 2019 (several days before the deadline), Hill electronically submitted a notice of appeal, a request to waive court fees, and an order on court fee waiver.^[3] The superior court clerk rejected the documents for the following reason: "You are submitting a Fee Waiver Request, so you cannot select that you already have a Fee Waiver. Do not check that box when re-submitting." The notice of rejection was generated on November 26, 2019. It appears Hill resubmitted the notice of appeal later that day, which the clerk then filed.

A clerk has a ministerial duty to file a document presented to it, so long as the document is in a form that complies with the rules of court. (Voit v. Superior Court (2011) 201 Cal.App.4th 1285, 1287; see Carlson v. Department of Fish & Game (1998) 68 Cal.App.4th 1268, 1270, 1276.) Even if the filing has a defect, "the clerk's office should file it and notify the party that the defect should be corrected." (Voit, at p. 1287.) Moreover, under rule 8.100(b)(3) of the California Rules of Court (Rule 8.100(b)(3)), a clerk must file a notice of appeal "even if the appellant does not present the filing fee, the deposit, or an application for, or order granting, a waiver of fees and costs."

Here, the clerk rejected Hill's notice of appeal because he checked a wrong box when submitting his fee waiver request. There is nothing in the Code of Civil Procedure, California Rules of Court, or the Los Angeles County Superior Court Local Rules that would permit the clerk to reject a notice of appeal for this reason. The clerk, therefore, had a ministerial duty to file the notice upon receipt. Further, by rejecting the notice essentially because of a technical defect with the fee waiver request, the clerk also violated Rule 8.100(b)(3).^[4] Because the clerk was required to file the notice of appeal on November 22, 2019, we may deem it filed on that date. (See Eliceche v. Federal Land Bank Assn. (2002) 103 Cal.App.4th 1349, 1361 ["A document is 'filed' when it is actually delivered to the clerk of the court during office hours, even if the clerk erroneously refuses to file it."]; Lezama-Carino v. Miller (2007) 149 Cal.App.4th 55, 59 [deeming notice of appeal timely filed where clerk refused to file it without an approved fee waiver]; Rapp v. Golden Eagle Ins. Co. (1994) 24 Cal.App.4th 1167, 1172 [deeming notice of appeal timely filed where clerk refused to file it without the full filing fee]; Pangilinan v. Palisoc (2014) 227 Cal.App.4th 765, 770 [same].) The notice of appeal, therefore, is timely.^[5]

2. Standard of Review

"When the trial court sustains a demurrer, we review the complaint de novo to determine whether it alleges facts stating a cause of action on any possible legal theory. [Citation.] '" 'We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law.'" [Citations.]' [Citation.] 'Further, "we give the complaint a reasonable interpretation, reading it as a whole and its parts in their context." [Citations.]'" (Rossberg v. Bank of America, N.A. (2013) 219 Cal.App.4th 1481, 1490.)

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