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Garcia v. World Savings

April 9, 2010

FRANCISCO GARCIA ET AL., PLAINTIFFS AND APPELLANTS,
v.
WORLD SAVINGS, FSB, DEFENDANT AND RESPONDENT.



APPEAL from a judgment of the Superior Court of Los Angeles County, Raul A. Sahagun, Judge. Reversed in part; affirmed in part and remanded. (Los Angeles County Super. Ct. No. VC049643.

The opinion of the court was delivered by: Manella, J.

CERTIFIED FOR PUBLICATION

Appellants Francisco and Maria Elena Garcia brought suit against their lender, respondent World Savings,*fn1 for wrongful foreclosure, breach of contract promissory estoppel, and unfair business practices.*fn2 The trial court granted respondent's motion for summary judgment, concluding that the foreclosure was valid, that the breach of contract claim was unsupported by consideration, that the promise allegedly made was insufficiently specific to support promissory estoppel and that the unfair business practices claim had no basis. We reverse with respect to the claim for promissory estoppel, but otherwise affirm.

FACTUAL AND PROCEDURAL BACKGROUND

A. Undisputed Facts

Most of the essential facts were not disputed for purposes of summary judgment. In September 2004, appellants purchased a residential property in Artesia using funds obtained from respondent.*fn3 The property was subject to a deed of trust. Between October 2006 and August 2007, appellants failed to make payments on the loan.*fn4 In January 2007, respondent sent appellants a notice of default. In May 2007, respondent sent appellants a notice of trustee's sale to take place June 21, 2007, later continued by respondent to July 20, 2007.

In July 2007, respondent postponed the trustee's sale to August 20, 2007.*fn5 That same month, appellants retained Cal Ravana, a mortgage broker, to obtain funds to cure the default by re-financing other property owned by appellants. In mid-August, Ravana spoke with Mike Lara, one of the managers of respondent's foreclosure department, and informed him that appellants had obtained a written conditional loan approval. Ravana faxed the approval to Lara and asked for another postponement. Lara agreed to postpone the sale to August 29.*fn6 Respondent provided Ravana a reinstatement quote of $26,596.37, the amount which if paid by August 29, would cure the default on the loan.

On August 27, Ravana called Lara to ask for an extension of time until the first week of September. According to Ravana, Lara stated that he would postpone the sale until August 30 and "see where [they] were at after that." When Ravana asked what would happen if appellants' new loan did not close by the 30th, Lara responded that the property "won't go to sale because I have the final say-so and as long as I know that you could close it the first week of August [sic], I'll extend it."*fn7

On August 29, Ravana called Lara's office several times and left messages on his direct line, letting him know that the loan would not close for another week. Lara did not return any of the calls or respond to any of the messages.

The trustee on the deed of trust sold the property at a foreclosure sale on August 30, 2007. Unaware of the foreclosure sale, appellants went forward with the refinancing of their other property. The loan closed on September 7, 2007, a Friday. The company handling the closing sent respondent a check for $26,596.37, which respondent received the following Monday, September 10. Respondent returned the check uncashed.

Upon receiving the check, Ravana called Lara and learned for the first time that the foreclosure sale had gone forward on August 30. According to Ravana, Lara said there had been a "mistake." In a subsequent conversation with Mrs. Garcia, Lara reiterated that a mistake had been made and said that appellants' property was not supposed to have been sold. Lara also told Mrs. Garcia that the matter would be "cleared up" in a few days. Lara acknowledged at his deposition that he spent almost a month in communication with Ravana, Mrs. Garcia and the purchaser "try[ing] to resolve [the] issue."*fn8

B. Complaint

In the first cause of action of their complaint, appellants alleged that the foreclosure sale of the property was "wrongful" in violation of Civil Code section 2924 et seq. and that it was "an illegal, fraudulent, and willingly oppressive sale of property under a power of sale contained in a deed of trust." In the third cause of action for breach of contract, appellants alleged that they and respondent "on valuable consideration" entered into an oral agreement whereby respondent agreed to postpone the foreclosure sale of the property. In their sixth cause of action for promissory estoppel, appellants alleged that respondent orally promised to postpone the ...


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