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Kenneth B. Robinson v. Countrywide Home Loans

September 12, 2011

KENNETH B. ROBINSON ET AL., PLAINTIFFS AND APPELLANTS,
v.
COUNTRYWIDE HOME LOANS, INC., ET AL., DEFENDANTS AND RESPONDENTS.



APPEAL from the Superior Court of Riverside County. Bernard Schwartz, Judge. (Super.Ct.No. RIC526427)

The opinion of the court was delivered by: McKinster J.

CERTIFIED FOR PUBLICATION

OPINION

Affirmed.

Plaintiffs and appellants Kenneth and Maria Robinson (plaintiffs) appeal from a judgment following the trial court's order sustaining, without leave to amend, a demurrer filed by defendants and respondents Countrywide Home Loans, Inc. (Countrywide) and Mortgage Electronic Registration Systems, Inc. (MERS).*fn1 We conclude that the trial court properly sustained the demurrer without leave to amend.

PROCEDURAL HISTORY

On or about June 1, 2010, plaintiffs filed a second amended complaint, alleging wrongful initiation of foreclosure (first cause of action), violation of Civil Code section 2943, subdivision (b)(1) (fourth cause of action) and unfair business practices (fifth cause of action). Plaintiffs also sought declaratory relief (second cause of action) and to quiet title (third cause of action).

Defendants Countrywide and MERS demurred to the first, second, third and fifth causes of action. On August 13, 2010, the court sustained the demurrer without leave to amend. On September 30, 2010, plaintiffs filed a request to dismiss the fourth cause of action only, without prejudice, and on September 30, 2010, the court entered judgment for Countrywide and MERS.

Plaintiffs filed a timely notice of appeal.

FACTS

The following facts are alleged in plaintiffs' complaint:

In October 2007, plaintiffs borrowed $380,000 from lender SBMC Mortgage to finance the purchase of real estate. In connection with that transaction, they executed a promissory note, which was secured by a deed of trust. The deed of trust identifies SBMC Mortgage as the lender and identifies T.D. Service Company as the trustee. It identifies MERS as "acting solely as a nominee for Lender and Lender's successors and assigns," and states that "MERS is the beneficiary under this Security Instrument." The deed of trust further states that "Borrower [i.e., plaintiffs] understands and agrees that MERS holds only legal title to the interests granted by Borrower in this Security Instrument, but, if necessary to comply with law or custom, MERS (as nominee for Lender and Lender's successors and assigns) has the right: to exercise any or all of those interests, including, but not limited to, the right to foreclose and sell the Property. . . ."

In December 2008 and January 2009, Countrywide, identifying itself as a debt collector and the servicer of the loan on the noteholder's behalf, notified plaintiffs that their loan was delinquent. Plaintiffs' attorney wrote to Countrywide requesting information concerning the loan, including a copy of the note, documents evidencing any sale, transfer, or assignment of the note, and a beneficiary statement and payoff demand statement pursuant to Civil Code section 2943. Countrywide requested more time to respond but did not provide the requested documents before notifying plaintiffs, on February 27, 2009, that their loan was in default and had been referred to Countrywide's foreclosure management committee for review. On February 11, 2009, however, ReconTrust, purporting to act as agent for the beneficiary of the deed of trust, had recorded a notice of default and election to sell the property under the deed of trust, stating that plaintiffs were in default and that the present beneficiary had elected to cause the property to be sold. Despite further requests, Countrywide failed to identify the current beneficiary on the note and deed of trust.

Plaintiffs alleged that their promissory note was "sold and resold" on the secondary mortgage market, and that as a result, it had become difficult or impossible to ascertain the actual owner of the beneficial interest in the note. They alleged that the identity of the person or entity that currently holds an ownership interest is unknown. They alleged that because Countrywide failed to comply with its statutory duty to provide them with the documents they requested, they did not know to whom they owed the obligation to repay the loan. They alleged on information and belief that "a person purporting to be the rightful current beneficiary, by virtue of a purported assignment from MERS," authorized an agent to cause the notice of default and election to sell to be recorded. They alleged on information and belief that SBMC did not assign the note to MERS and did not authorize MERS or any other person to assign the note ...


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