Hughes v. OneWest Bank
| Decision Date | 13 March 2012 |
| Docket Number | A130897 |
| Parties | KEVIN HUGHES, Plaintiff and Appellant, v. ONEWEST BANK et al., Defendants and Respondents. |
| Court | California Court of Appeals Court of Appeals |
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Napa County Super. Ct. No. 26-48314)
This appeal has been taken from an order that sustained OneWest Bank and Deutsche Bank National Trust Company's (defendants) demurrer to all of the causes of action of plaintiff's third amended complaint without leave to amend. We find that the demurrer was properly sustained, and no reasonable possibility exists that plaintiff may be able to state causes of action against defendants for wrongful foreclosure, fraud, unfair business practices, or to quiet title. We therefore conclude that the action was properly dismissed in its entirety, and affirm the judgment.
To finance the purchase of real property in American Canyon, on April 20, 2007, plaintiff executed and delivered to defendant Residential Mortgage Capital (RMC) a promissory note and deed of trust on the property to secure a loan in the amount of $720,000. A series of assignments and transfers of the note and deed of trust ensued, and ultimately a nonjudicial foreclosure sale of the property was conducted by defendant Quality Loan Service Corp. (Quality) on January 15, 2010. Plaintiff's third amended complaint and attached exhibits reveal the following chronology of events.
On April 28, 2007, the promissory note and deed of trust were recorded at the request of RMC, with defendant Mortgage Electronic Registration Services (MERS) designated as beneficiary, and defendant Fidelity National Title (Fidelity) designated as trustee. Effective February 24, 2009, MERS assigned all beneficial interest in the deed of trust to defendant IndyMac Federal Bank FSB (IndyMac).1 The assignment was recorded on April 21, 2009.
As agent for beneficiary IndyMac, defendant Quality recorded and sent to plaintiff a notice of default and election to sell under deed of trust on March 9, 2009. IndyMac also sent to plaintiff a proposed loan modification agreement (proposed agreement) on March 10, 2009, for his signature and return. The proposed agreement contained modified loan terms, including an increase in the principal balance of the note. By its terms the proposed agreement was not binding on IndyMac unless and until plaintiff was determined to qualify for the modification offer, and it was signed by IndyMac after verification of income information.
Plaintiff signed the proposed agreement on April 4, 2009. The pleading also alleges that plaintiff provided to IndyMac a financial statement and a check in the amount of $2,822.20, as specified in the proposed agreement.
IndyMac, acting in its capacity as beneficiary, filed and recorded a substitution of trustee (substitution) on April 21, 2009, that designated Quality as trustee under the deed of trust. The substitution indicated that IndyMac was the current beneficiary in place of MERS.
In a letter from IndyMac received on June 8, 2009, plaintiff was informed that the check for $2,822.20 he previously tendered "does not represent the total amount due at this time." Plaintiff was also advised in the letter to contact the IndyMac office "immediately for the amount required to bring your loan current." Plaintiff's check was returned with the letter.
Following the denial of the loan modification, plaintiff sent a rescission letter to OneWest on June 19, 2009, in which he ostensibly exercised his right to cancel the loan pursuant to the Truth in Lending Act (15 U.S.C. § 1635), and requested a refund of payments and fees along with removal of the deed of trust from the title record. In the rescission letter plaintiff claimed that he was ready and able to tender the amount due minus equitable setoff. By letter dated July 2, 2009, OneWest denied plaintiff's right to rescind as not validly exercised.
On June 11, 2009, Quality recorded a notice of trustee's sale that indicated plaintiff's default and an intent to sell the property on behalf of the foreclosing beneficiary at a public auction on July 1, 2009. The property was sold on January 15, 2010, to defendant Deutsche Bank National Trust Company (Deutsche Bank), the trustee of the IndyMac IMSC Mortgage Loan Trust 2007-F2, under a pooling and servicing agreement dated June 1, 2007. Quality then recorded a trustee's deed upon sale, which conveyed the property to "foreclosing beneficiary" Deutsche Bank.
This action commenced on June 22, 2009, when plaintiff filed a complaint in Napa County Superior Court following receipt of the notice of trustee's sale. After a first amended complaint was filed that included causes of action based on federal statutes (12 U.S.C. § 2601; 15 U.S.C. § 1601; 18 U.S.C. § 1961), the case was removed to the United States District Court for the Northern District of California on the basis of federal question jurisdiction. The federal court subsequently dismissed the federal claims stated in plaintiff's first and second amended complaints without leave to amend, declined to retain supplemental jurisdiction over the remaining state law causes of action, and remanded the case to the Napa County Superior Court.
After defendants' demurrer to plaintiff's second amended complaint was sustained by the trial court with leave to amend, on September 7, 2010, plaintiff filed the third amended complaint, which is at issue in this appeal. The third amended complaint contains causes of action against defendants for wrongful foreclosure, fraud (Civ. Code, § 1572), unfair business practices, and to quiet title. Defendants OneWest and Deutsche Bank demurred to the third amended complaint on the ground that the pleading failed tostate any causes of action. The demurrer was sustained without leave to amend, and this appeal followed.
Plaintiff seems to claim, although quite summarily, that the trial court inadequately stated reasons for sustaining the demurrer. He complains that when a statement of reason was requested the trial court merely stated: "For the reasons set forth at length in the demurrer, plaintiff has failed to state facts to support any cause of action." Plaintiff submits that the court's recitation of reasons failed to comply with the requirements of Code of Civil Procedure section 472d, which provides that in ruling on a demurrer "the court shall include in its decision or order a statement of the specific ground or grounds upon which the decision or order is based which may be by reference to appropriate pages and paragraphs of the demurrer." (See also Crowley v. Katleman (1994) 8 Cal.4th 666, 676.) Here, defendants demurred on the sole ground that plaintiff failed "to allege facts sufficient to constitute a cause of action" against them. The supporting exhibits and points and authorities submitted by defendants thoroughly explicated the bases for their claim that plaintiff failed to state any causes of action in his third amended complaint. The trial court properly referred to the demurrer itself in its ruling. The statement of reasons both alerted plaintiff to the substance of the court's decision and complied with the mandate of section 472d. (See Stevenson v. San Francisco Housing Authority (1994) 24 Cal.App.4th 269, 275; Mautner v. Peralta (1989) 215 Cal.App.3d 796, 801; Berkeley Police Assn. v. City of Berkeley (1977) 76 Cal.App.3d 931, 943.)
We turn to an examination of the trial court's ruling on the demurrer in accordance with established standards. "A demurrer tests the sufficiency of the complaint as a matter of law; as such, it raises only a question of law." (Osornio v. Weingarten (2004) 124 Cal.App.4th 304, 316.) " (Bagatti v. Department of Rehabilitation (2002) 97 Cal.App.4th 344, 352; see also Lee v. Blue Shield of California (2007) 154 Cal.App.4th 1369, 1377-1378.)
The properly pleaded material allegations in the action filed by plaintiff (C.J.L. Construction, Inc. v. Universal Plumbing (1993) 18 Cal.App.4th 376, 382-383.) (Hoffman v. Smithwoods RV Park, LLC (2009) 179 Cal.App.4th 390, 400 (Hoffman); see also Banis Restaurant Design, Inc. v....
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