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Daryoush Javaheri v. Jpmorgan Chase Bank

December 11, 2012


The opinion of the court was delivered by: Otis D. Wright, II United States District Judge



Defendants JPMorgan Chase Bank, N.A. and California Reconveyance Company move for summary judgment on Plaintiff Daryoush Javaheri's Complaint originally filed in Javaheri v. JP Morgan Chase Bank N.A. ("Javaheri II"), No. 11-cv-10072-ODW-FFM (C.D. Cal. filed December 5, 2011). (Javaheri II has now been consolidated with Javaheri v. JP Morgan Chase Bank N.A. ("Javaheri I"), No.10-cv-08185-ODW-FHM (C.D. Cal. filed Oct. 29, 2010).) Having carefully considered the papers filed in support of and in opposition to Defendants' Motion, the Court deems this matter appropriate for decision without oral argument. See Fed. R. Civ. P. 78; L.R. 7-15. For the reasons discussed below, the Court GRANTS Defendants' motion in its entirety.


On December 6, 2006, Plaintiff Daryoush Javaheri obtained a $975,000 mortgage loan from Washington Mutual Bank, FA ("WaMu") to finance the purchase of a condominium located at 10660 Wilshire Blvd., #1401, Los Angeles, California 90024 (the "Wilshire Property"). (JPMorgan's Statement of Undisputed Fact ("SUF")

1.) In connection with the loan, Javaheri executed a promissory note (the "Note") secured by a Deed of Trust encumbering the property. (Id.) The Deed of Trust, recorded on December 13, 2006, identifies WaMu as the lender beneficiary and California Reconveyance Company ("CRC") as the trustee under the Deed of Trust. (SUF 2.)

On January 1, 2007, WaMu sold the beneficial interest in Javaheri's loan to WaMu Asset Acceptance Corporation, which then transferred the loan to LaSalle Bank National Association, as trustee of the Washington Mutual Mortgage Pass-Through Certificates Series 2007-HY1 Trust (the "2007-HY1 Trust"). (SUF 6.) Later in 2007, Bank of America took LaSalle's place as trustee of the 2007-HY1 Trust as the successor by merger to LaSalle. As a result, Bank of America is the current trustee of the 2007-HY1 Trust and beneficial interest-holder in Javaheri's loan.

Shortly after the transfer of Javaheri's loan to the 2007-HY1 Trust, WaMu, WaMu Asset Acceptance, and LaSalle entered into a Pooling and Servicing Agreement whereby WaMu became the servicer of the pool of loans sold to 2007-HY1 Trust (including Javaheri's loan). (SUF 10.) As a result, WaMu was expressly given "full power and authority to do . . . all things in connection with such servicing and administration" of the trust. (Id.) WaMu's servicing and administration duties included collecting all loan payments, abiding by collection practices for comparable loans, and foreclosing on loans in default. (SUF 11.) WaMu acted as servicer on Javaheri's loan from origination until WaMu's failure in 2008. (SUF 12.)

On September 25, 2008, the Office of Thrift Supervision ("OTS") closed WaMu and appointed the Federal Deposit Insurance Commission ("FDIC") as receiver. (SUF 13.) In this role, the FDIC assumed all of WaMu's "rights, titles, powers, and privileges." 12 U.S.C. § 1821(d)(2)(A)(i). Additionally, the FDIC as receiver held the power to transfer assets and liabilities of WaMu through purchase-and-assumption agreements. 12 U.S.C. § 1821(d)(2)(G)(i).

On September 25, 2008, the FDIC negotiated the sale of certain assets held by WaMu to JPMorgan. (SUF 15.) That same day, the parties memorialized the arrangement in a Purchase and Assumption Agreement. (Id.) Among the assets JPMorgan acquired were WaMu's mortgage-servicing rights, which included the right to service Javaheri's loan. (JP Morgan's UF 16.)

After WaMu failed, Javaheri understood that JPMorgan was his loan servicer, and he accordingly directed loan payments to JPMorgan for some time. (SUF 18.) Javaheri made payments through January 15, 2010, before defaulting on his loan in February 2010. (SUF 19, 26.) Javaheri contends he stopped making his mortgage payments because he was unsure who his lender was, though he made no effort to ascertain the identity of his lender before he stopped making his payments. (SUF 20-- 21.) In addition, Javaheri has testified that he is unsure he would have been able to make payments on his loan at the time of default because he had no income or assets to use to make his payments. (SUF 27.) Through at least October 3, 2012, Javaheri had no source of income. (SUF 28.)

On May 20, 2010, JPMorgan assigned any beneficial interest in the Deed of Trust it may have acquired from the FDIC-if any-to Bank of America (as successor by merger to LaSalle Bank) as trustee of the 2007-HY1 Trust. (SUF 29.) At the time this Assignment of Deed of Trust was recorded, JPMorgan did not claim to hold the beneficial interest in Javaheri's Deed of Trust, as WaMu had transferred Javaheri's loan to the 2007-HY1 Trust prior to September 25, 2008 (the date JPMorgan acquired certain of WaMu's assets from the FDIC as receiver). (SUF 30.) Nevertheless, JPMorgan executed the Assignment to clarify in the public records that it was not the then-current beneficiary under the Deed of Trust. (Id.)

Also on May 20, 2010, CRC (still the original trustee under the Deed of Trust) recorded a Notice of Default ("NOD"). (SUF 31.) The NOD indicated that, as of May 28, 2010, Javaheri's account was overdue in the amount of $22,851.64. (Id.) At the time the NOD was recorded, the 2007-HY1 Trust was the beneficiary under the Deed of Trust, and JPMorgan, as the Servicer under P&S Agreement, was fully authorized by the 2007-HY1 Trust to foreclose on Javaheri's defaulted loan. (SUF 32.)

On November 18, 2011, CRC recorded a Notice of Trustee's Sale ("NOTS") representing that as of November 18, 2011, the total unpaid balance and other charges on Javaheri's loan were estimated at $1,105,716.79. (Id.)

As of October 29, 2012, the Trustee's Sale of the Property has not occurred. (SUF 34.) JPMorgan currently remains the servicer of Javaheri's loan, and the 2007-HY1 Trust is the record Lender and beneficiary of the loan. (SUF 35--36.) JPMorgan is in possession of the original Note and Deed of Trust on behalf of the 2007-HY1 Trust. (SUF 37.)


On December 5, 2011, Plaintiff Daryoush Javaheri filed suit against Defendants for (1) wrongful foreclosure; (2) quasi contract; (3) quiet title; (4) declaratory and injunctive relief; and (5) no contract/fraud. Javaheri II, No. 11-cv-10072-ODW-FFM, ECF No. 1 (C.D. Cal. filed December 5, 2011). In response, Defendants moved to dismiss Javaheri's claims. Javaheri II, ECF No. 12. The Court dismissed Javaheri's claim for no ...

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