SENCION v. SAXON MORTGAGE Serv. LLC.
| Decision Date | 11 April 2011 |
| Docket Number | Case Number 5:10-cv-3108 JF |
| Parties | OSCAR MADRIGAL SENCION, Plaintiff, v. SAXON MORTGAGE SERVICES, LLC; OCWEN LOAN SERVICING, LLC; DEUTSCHE BANK NATIONAL TRUST COMPANY, as TRUSTEE FOR NATIXIS REAL ESTATE CAPITAL TRUST 2007-HE2; and DOES 1 through 100 , inclusive Defendants. |
| Court | U.S. District Court — Northern District of California |
OPINION TEXT STARTS HERE
Plaintiff Oscar Madrigal Sencion seeks a temporary restraining order to prevent the enforcement of the writ of possession granted to Defendant Deutsche Bank National Trust Company ("Deutsche Bank") by the Santa Clara Superior Court on March 21, 2011. Plaintiff contends that Defendants negligently foreclosed on his home without proper notice and despite having approved him for a permanent loan modification and having accepted payments pursuant to a trial loan modification. On the limited record before it, the Court finds that Plaintiff has shown a reasonable likelihood of success on the merits and that the balance of the hardships tips decidedly in his favor. Accordingly, a temporary restraining order will issue, Defendants will be ordered to show cause why a preliminary injunction should not issue, and a hearing on the order to show cause will be set for April 22, 2011.
Plaintiff alleges the following: In December 2006, he obtained a mortgage that was owned by Deutsche Bank and serviced by Saxon Mortgage Services, Inc. ("Saxon"). In August 2009, he received a trial loan modification from Saxon. Plaintiff made payments under the trial loan modification and continued to make "good faith payments" while he was being reviewed for a permanent loan modification. Plaintiff's payment for March 2010 was received and cashed by Saxon. On March 3, 2010, Plaintiff received a letter from Saxon indicating that he had been approved for a permanent loan modification and would be receiving the necessary paperwork within thirty days. However, on March 19, 2010, without notice to Plaintiff, Deutsche Bank purchased the property at a trustee's sale. On March 26, 2010, Plaintiff received a three-day notice to quit the premises.
In April 2010, Plaintiff filed a complaint against Saxon in Santa Clara Superior Court alleging, inter alia, negligent foreclosure and unfair trade practices. In addition, he sought and was granted a temporary restraining order and preliminary injunction by the Santa Clara Superior Court prohibiting Saxon from proceeding with unlawful detainer or eviction proceedings against him. At the same time, the servicing of Plaintiff's mortgage was transferred to Defendant Ocwen Loan Servicing ("Ocwen"). On June 1, 2010, Plaintiff amended his state-court complaint to include Ocwen. Defendants subsequently removed the case to this Court and moved to dismiss Plaintiff's first amended complaint. Magistrate Judge Paul S. Grewal granted in part and denied in part Defendants' motion to dismiss. Judge Grewal concluded that Plaintiff's allegations against Ocwen "sufficiently allege an actual controversy relating to, at a minimum, [his] payment obligations and Ocwen's present right to service the Subject Property." Order of Feb. 2, 2011. Plaintiff then sought leave to amend the complaint a second time to add Defendant Deutsche Bank, which was granted in part. The second amended complaint was filed on March 4, 2011.
Meanwhile, on January 4, 2011, Deutsche Bank began new eviction proceedings against Plaintiff in the Santa Clara Superior Court. That court issued a writ of possession in favor of the bank on March 21, 2011, and on April 6, 2011, Plaintiff received a notice to vacate the premises on or before April 12, 2011. Plaintiff filed the instant application for a temporary restraining order on April 8, 2011.
The standard for issuing a TRO is the same as that for issuing a preliminary injunction. Brown Jordan Int'l, Inc. v. Mind's Eye Interiors, Inc., 236 F. Supp. 2d 1152, 1154 (D. Hawaii 2002); Lockheed Missile & Space Co., Inc. v. Hughes Aircraft Co., 887 F. Supp. 1320, 1323 (N.D. Cal. 1995). A preliminary injunction is "an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief." Winter v. Natural Res. Def. Council, Inc., 129 S.Ct. 365, 376 (2008). "The proper legal standard for preliminary injunctive relief requires a party to demonstrate [1] 'that he is likely to succeed on the merits, [2] that he is likely to suffer irreparable harm in the absence of preliminary relief, [3] that the balance of equities tips in his favor, and [4] that an injunction is in the public interest.'" Stormans, Inc. v. Selecky, 586 F.3d 1109, 1127 (9th Cir. 2009) (citing Winter, 129 S. Ct. at 374)). The Ninth Circuit recently reaffirmed that within this framework a preliminary injunction also is appropriate when a plaintiff demonstrates "that serious questions going to the merits were raised and the balance of the hardships tips sharply in the plaintiff's favor," thereby allowing district courts to preserve the status quo where difficult legal questions require more deliberate investigation. Alliance for the Wild Rockies v. Cottrell, 613 F.3d 960 (2010).
Plaintiff alleges five claims against Deutsche Bank: breach of fiduciary duty; negligence; violation of the California Unfair Business Practices Act, Cal. Bus & Prof. Code § 17200, et seq.; declaratory relief; and quiet title. However, in ruling on Plaintiff's motion to file a second amended complaint, Judge Grewal granted Plaintiff leave to amend the complaint his claims against Deutsche only as to the claims for negligence and declaratory relief. See Order of Feb. 17, 2011 at 1.
Judge Grewal denied Saxon's motion to dismiss Plaintiff's negligence claim because the complaint alleges facts sufficient to support a finding "that Saxon undertook the modification of [the] loan, and that Saxon was responsible for the modification." See Order of Jan. 28, 2011 at 8. In granting Plaintiff leave to add Deutsche Bank as a defendant, Judge Grewal concluded that Plaintiff had pled adequately that Saxon was Deutsche Bank's agent and that the negligent act was within the scope of the agency relationship. Order of Feb. 17, 2011.
Plaintiff has attached as an exhibit to his pleading a letter from Saxon that begins, SAC Ex. M. The letter states that the "Final Modification Agreements" will be ordered and sent to Plaintiff for his signature. Id. While it indicates that the loan would not be modified if any remaining trial period payments were not made on time, nothing in the letter suggests that either Saxon or Deutsche could decline to proceed with the...
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Castellanos v. Countrywide Bank Na, Case No. 15-cv-00896-BLF
...an opportunity to pursue what appear to be valid claims before being displaced from their homes." Sencion v. Saxon Mortg. Servs., LLC, 2011 WL 1364007, at *1 (N.D. Cal. Apr. 11, 2011). Plaintiff has met this fourth Winter factor. IV. ORDER Plaintiff has established three of the four Winter ......