Trujillo v. Nw. Tr. Servs., Inc., No. 90509–6.

CourtUnited States State Supreme Court of Washington
Writing for the CourtGORDON McCLOUD, J.
Citation183 Wash.2d 820,355 P.3d 1100
Docket NumberNo. 90509–6.
Decision Date20 August 2015
PartiesRocio TRUJILLO, Petitioner, v. NORTHWEST TRUSTEE SERVICES, INC., Respondent; Wells Fargo Bank, NA, Defendant.

183 Wash.2d 820
355 P.3d 1100

Rocio TRUJILLO, Petitioner
v.
NORTHWEST TRUSTEE SERVICES, INC., Respondent;
Wells Fargo Bank, NA, Defendant.

No. 90509–6.

Supreme Court of Washington, En Banc.

Argued June 23, 2015.
Decided Aug. 20, 2015.


355 P.3d 1103

John Matthew Geyman, Columbia Legal Services, Seattle, WA, for Petitioner.

Abraham K. Lorber, Attorney at Law, Seattle, WA, for Defendant.

Joshua Saul Schaer, RCO Legal, P.S., Bellevue, WA, for Respondent.

Richard Llewelyn Jones, Kovac & Jones, PLLC, Bellevue, WA, Ha Thu Dao, Grand Central Law, PLLC, Seattle, WA, amicus counsel for COAlition for Civil Justice.

Sheila M. O'sullivan, Northwest Consumer Law Center, Melissa Ann Huelsman, Law Offices of Melissa A. Huelsman, Seattle, WA, amicus counsel for Northwest Consumer Law Center.

Lisa Marie Von Biela, Lisa M. von Biela, Issaquah, WA, amicus counsel for Northwest Justice Project.

Benjamin Jerauld Roesch, Attorney General of Washington, Leilani Nicole Fisher, Attorney at Law, Seattle, WA, amicus counsel for Attorney General.

John Sterling DevlinIII, Andrew Gordon Yates, Lane Powell PC, Abraham K. Lorber, Attorney at Law, Seattle, WA, amicus counsel for Federal Home Loan Mortgage Corporation.

Opinion

GORDON McCLOUD, J.

183 Wash.2d 826

¶ 1 Rocio Trujillo's home loan was secured by a deed of trust encumbering the home. She defaulted, and Northwest Trustee Services Inc. (NWTS), the successor trustee, sent a notice of default and scheduled a trustee's sale of her property. Under the deeds of trust act (DTA), a trustee may not initiate such a nonjudicial foreclosure without “proof that the beneficiary [of the deed of trust] is the owner of any promissory note ... secured by the deed of trust.” RCW 61.24.030(7)(a) (emphasis added). But the very next sentence of that statute says, “A declaration by the beneficiary made under the penalty of perjury stating that the beneficiary is the actual holder of the promissory note or other obligation secured by the deed of trust shall be sufficient proof as required under this subsection.” Id. (emphasis added).

¶ 2 NWTS had a beneficiary declaration from Wells Fargo Bank. It did not contain that specific statutory language. Instead, it stated under penalty of perjury, “Wells Fargo Bank, NA is the actual holder of the promissory note ... or has requisite authority under RCW 62A.3–301 to enforce said [note].” Clerk's Papers (CP) at 36 (emphasis added). This declaration language differs from the language of RCW 61.24.030(7)(a), quoted above, by adding the “or” alternative.

¶ 3 Following our recent decision in Lyons v. U.S. Bank National Ass'n, 181 Wash.2d 775, 336 P.3d 1142 (2014), we hold that a trustee cannot rely on a beneficiary declaration containing such ambiguous alternative language. Trujillo therefore alleged facts sufficient to show that NWTS breached the DTA and also to show that that breach could

183 Wash.2d 827

support the elements of a Consumer Protection Act (CPA) claim. Ch. 19.86 RCW. However, her allegations do not support a claim for intentional infliction of emotional distress or criminal profiteering. We therefore reverse in part and remand for trial.

FACTUAL ALLEGATIONS1

¶ 4 In 2006, Trujillo took out a loan for $185,900 from Arboretum Mortgage Corporation to buy her home. This loan was evidenced by a promissory note secured by a deed of trust dated March 29, 2006 encumbering the home. CP at 17.2 The deed of

355 P.3d 1104

trust was recorded in King County on March 31, 2006. Id.

¶ 5 Arboretum sold this loan to Wells Fargo in 2006. CP at 86. Wells Fargo sold the loan to Federal National Mortgage Association (Fannie Mae) and retained the loan servicing rights. Id.

¶ 6 In 2012, Arboretum assigned the deed of trust to Wells Fargo. CP at 35. The assignment was recorded in King County on February 2, 2012. Id.

¶ 7 Trujillo admits that she defaulted on her loan on November 1, 2011. CP at 86.

¶ 8 Then, in a beneficiary declaration dated March 14, 2012 and delivered to NWTS, Wells Fargo stated, “Wells Fargo Bank, NA is the actual holder of the promissory note

183 Wash.2d 828

or other obligation evidencing the above-referenced loan or has requisite authority under RCW 62A.3–301 to enforce said obligation.” CP at 36.

¶ 9 NWTS, the successor trustee, sent Trujillo a notice of default dated May 30, 2012, itemizing the amounts in arrears on the delinquent loan. CP at 37–39. This notice also gave Trujillo certain information about both Fannie Mae and Wells Fargo. CP at 38. Specifically, it stated, “The owner of the note is Federal National Mortgage Association (Fannie Mae),” and it listed Fannie Mae's address. Id. This notice also stated, “The loan servicer for this loan is Wells Fargo Bank, N.A.,” and it listed Wells Fargo's address. Id. Additionally, the notice of default identified NWTS as Wells Fargo's “duly authorized agent.” CP at 39.3

¶ 10 NWTS recorded the notice of trustee's sale on July 10, 2012, and it scheduled a sale date of November 9, 2012, for Trujillo's property. CP at 41–44.4

PROCEDURAL BACKGROUND

¶ 11 On February 27, 2013, Trujillo, acting pro se, sued NWTS and Wells Fargo. CP at 84–94. She claimed that NWTS and Wells Fargo violated the DTA. CP at 88–91.5

183 Wash.2d 829

Trujillo also claimed violations of the CPA and the Criminal Profiteering Act, as well as intentional infliction of emotional distress. CP at 91–94; ch. 9A.82 RCW. She sought an injunction to restrain the successor trustee's sale of her property, damages, and attorney fees. CP at 94.

¶ 12 NWTS filed a CR 12(b)(6) motion to dismiss. CP at 1–16. NWTS argued that RCW 61.24.030(7) authorized it to rely on Wells Fargo's beneficiary declaration signed in March 2012 as the basis for asserting that Wells Fargo was the “beneficiary” in its notice of default. The trial court granted this motion and dismissed Trujillo's claims against NWTS with prejudice. CP at 80–81.6

355 P.3d 1105

¶ 13 Trujillo appealed. CP at 95–98. The Court of Appeals affirmed, holding that NWTS could lawfully rely on Wells Fargo's beneficiary declaration for authority to initiate a trustee's sale of Trujillo's property and that NWTS did not breach its DTA duty of good faith. Trujillo v. Nw. Tr. Servs., Inc., 181 Wash.App. 484, 487, 326 P.3d 768 (2014).

¶ 14 We granted Trujillo's petition for review but deferred consideration pending our decision in Lyons. Trujillo v. Nw. Tr. Servs., Inc., 182 Wash.2d 1020, 345 P.3d 784 (2015).

ANALYSIS

¶ 15 Trujillo alleged three causes of action against NWTS: one under the CPA, one under the Criminal Profiteering Act, and one for intentional infliction of emotional distress. She bases all of these claims on NWTS's reliance on Wells Fargo's March 2012 beneficiary declaration as a basis for sending the notice of trustee's sale. Trujillo alleges

183 Wash.2d 830

that this conduct violates RCW 61.24.030(7), which requires a trustee to have proof that the beneficiary is the owner of the promissory note before issuing a notice of trustee sale, and RCW 61.24.010(4), which imposes a duty of good faith on the trustee. CP at 89. Because Trujillo's CPA, profiteering, and intentional infliction of emotional distress claims hinged on her theory that NWTS could not lawfully rely on the beneficiary declaration, the trial court dismissed all of her claims after determining that the declaration sufficed under the DTA.

I. Standard of Review

¶ 16 This court reviews CR 12(b)(6) dismissals de novo.7 Kinney v. Cook, 159 Wash.2d 837, 842, 154 P.3d 206 (2007). Dismissal is proper if the court concludes that the plaintiff can prove no set of facts that would justify recovery.Id. We presume that the plaintiff's factual allegations are true and draw all reasonable inferences from the factual allegations in the plaintiff's favor. Gorman v. City of Woodinville, 175 Wash.2d 68, 71, 283 P.3d 1082 (2012) (citing Reid v. Pierce County, 136 Wash.2d 195, 201, 961 P.2d 333 (1998) ). We may even consider hypothetical facts to determine if dismissal is proper. Lakey v. Puget Sound Energy, Inc., 176 Wash.2d 909, 922 n. 9, 296 P.3d 860 (2013). “But, ‘[i]f a plaintiff's claim remains legally insufficient even under his or her proffered hypothetical facts, dismissal pursuant to CR 12(b)(6) is appropriate.’ ” FutureSelect Portfolio Mgmt., Inc. v. Tremont Grp. Holdings, Inc., 180 Wash.2d 954, 963, 331 P.3d 29 (2014) (alteration in original) (quoting Gorman v. Garlock, Inc., 155 Wash.2d 198, 215, 118 P.3d 311 (2005) ).

183 Wash.2d 831

II. Trujillo Alleges Facts Sufficient To Prove NWTS Violated the DTA

A. DTA Statutory Framework

¶ 17 The first statute at issue here is RCW 61.24.030. It provides a mandatory...

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128 practice notes
  • Life Designs Ranch, Inc. v. Sommer, No. 32922–4–III.
    • United States
    • Court of Appeals of Washington
    • November 12, 2015
    ...constitutes outrage. In such a setting, the plaintiff must establish "extreme" conduct. Trujillo v. Nw. Trustee Servs., Inc., 183 Wash.2d 820, 840, 355 P.3d 1100 (2015).¶ 52 In Caruso v. Local Union, the defendant union published a "do not patronize" article in its weekl......
  • Keodalah v. Allstate Ins. Co., No. 95867-0
    • United States
    • United States State Supreme Court of Washington
    • October 3, 2019
    ...Training Stables, Inc. v. Safeco Title Ins. Co ., 105 Wash.2d 778, 785-793, 719 P.2d 531 (1986) ; Trujillo v. Nw. Tr. Servs., Inc. , 183 Wash.2d 820, 834-35, 355 P.3d 1100 (2015). All five elements must be established for a CPA claim to be successful. Panag v. Farmers Ins. Co. of Wash ., 16......
  • McCarthy v. Cnty. of Clark, No. 46347–4–II.
    • United States
    • Court of Appeals of Washington
    • April 12, 2016
    ...infliction of emotional distress, and (3) actual result to the plaintiff of severe emotional distress. Trujillo v. NW Tr. Servs., Inc., 183 Wash.2d 820, 840, 355 P.3d 1100 (2015).¶ 146 To establish extreme and outrageous conduct, a plaintiff must show that the conduct was so outrageous in c......
  • Bavand v. OneWest Bank, FSB, No. 74347-3-I
    • United States
    • Court of Appeals of Washington
    • November 28, 2016
    ...540, 359 P.3d 771 (2015) ; Trujillo v. Nw. Tr. Servs., Inc., 181 Wash.App. 484, 500–02, 326 P.3d 768 (2014), rev'd on other grounds, 183 Wash.2d 820, 355 P.3d 1100 (2015).8 SeeBrown, 184 Wash.2d at 540, 359 P.3d 771 ; Trujillo, 181 Wash.App. at 500–02, 326 P.3d 768.9 SeeRanger Ins. Co. v. P......
  • Request a trial to view additional results
128 cases
  • Life Designs Ranch, Inc. v. Sommer, No. 32922–4–III.
    • United States
    • Court of Appeals of Washington
    • November 12, 2015
    ...constitutes outrage. In such a setting, the plaintiff must establish "extreme" conduct. Trujillo v. Nw. Trustee Servs., Inc., 183 Wash.2d 820, 840, 355 P.3d 1100 (2015).¶ 52 In Caruso v. Local Union, the defendant union published a "do not patronize" article in its weekl......
  • Keodalah v. Allstate Ins. Co., No. 95867-0
    • United States
    • United States State Supreme Court of Washington
    • October 3, 2019
    ...Training Stables, Inc. v. Safeco Title Ins. Co ., 105 Wash.2d 778, 785-793, 719 P.2d 531 (1986) ; Trujillo v. Nw. Tr. Servs., Inc. , 183 Wash.2d 820, 834-35, 355 P.3d 1100 (2015). All five elements must be established for a CPA claim to be successful. Panag v. Farmers Ins. Co. of Wash ., 16......
  • McCarthy v. Cnty. of Clark, No. 46347–4–II.
    • United States
    • Court of Appeals of Washington
    • April 12, 2016
    ...infliction of emotional distress, and (3) actual result to the plaintiff of severe emotional distress. Trujillo v. NW Tr. Servs., Inc., 183 Wash.2d 820, 840, 355 P.3d 1100 (2015).¶ 146 To establish extreme and outrageous conduct, a plaintiff must show that the conduct was so outrageous in c......
  • Bavand v. OneWest Bank, FSB, No. 74347-3-I
    • United States
    • Court of Appeals of Washington
    • November 28, 2016
    ...540, 359 P.3d 771 (2015) ; Trujillo v. Nw. Tr. Servs., Inc., 181 Wash.App. 484, 500–02, 326 P.3d 768 (2014), rev'd on other grounds, 183 Wash.2d 820, 355 P.3d 1100 (2015).8 SeeBrown, 184 Wash.2d at 540, 359 P.3d 771 ; Trujillo, 181 Wash.App. at 500–02, 326 P.3d 768.9 SeeRanger Ins. Co. v. P......
  • Request a trial to view additional results

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