Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Official citation and/or docket number and footnotes (if any) for this case available with purchase.

Learn more about what you receive with purchase of this case.

Cortez v. CitiMortgage, Inc.

United States District Court, C.D. California

December 11, 2014

CORTEZ
v.
CITIMORTGAGE, INC., et al

CIVIL MINUTES - GENERAL

The Honorable R. GARY KLAUSNER, UNITED STATES DISTRICT JUDGE.

Proceedings: (IN CHAMBERS) Order re: Defendants CitiMortgage, Inc. and U.S. Bank National Association's Motion to Dismiss (DE 19)

I. INTRODUCTION

On October 3, 2014, plaintiff Priscilla Cortez (" Plaintiff") filed a First Amended Complaint (" FAC") against CitiMortgage, Inc. (" Citi"), U.S. Bank National Association (" U.S. Bank"), and Clear Recon Corporation (" Clear Recon") (collectively, " Defendants"). The FAC contains thirteen causes of action arising from Defendants' handling of Plaintiff's attempts to modify a residential loan agreement.

On October 20, 2014, Citi and U.S. Bank (collectively, " Moving Defendants") filed the present Motion to Dismiss for failure to state a claim pursuant to Federal Rule of Civil Procedure (" Rule") 12(b)(6). For the following reasons, the Court DENIES Moving Defendants' Motion.

II. FACTUAL BACKGROUND

The following facts are based upon Plaintiff's allegations. On October 11, 2006, Plaintiff executed a promissory note and obtained a first-position loan in the original principal amount of $257, 000 from Argent Mortgage Company, LLC. Plaintiff concurrently executed a first-lien deed of trust, which secured the note and encumbered a parcel of real property (the " Subject Property"). The deed of trust and all beneficial interest therein was eventually transferred via assignment to U.S. Bank on September 20, 2013. Clear Recon is the current trustee of record, and City is the current servicer of the loan.

Citi offered Plaintiff a trial loan modification plan (" Trial Plan") on July 30, 2013 under the federal Home Affordable Modification Program (" HAMP"). To accept Citi's offer, Plaintiff needed to make the first of three " trial period payments, " in the amount of $1, 215.78, by September 1, 2013. To qualify for a permanent modification, Plaintiff needed to make two additional trial period payments, each in the same amount, by October 1, 2013 and November 1, 2013, respectively. The letter containing Citi's offer stated that after all trial period payments were timely made and Plaintiff submitted all required documents, Plaintiff's mortgage would be permanently modified.

Plaintiff made her first Trial Plan payment via check dated August 25, 2013, which Citi accepted and cashed. Plaintiff made her second payment via check dated September 27, 2013. However, rather than accepting this timely second payment, Citi sent Plaintiff a letter dated October 2, 2013, informing her that it was returning her check " because it was less than the full amount due to bring [her] account current." (FAC, Ex. I.) The letter stated that " [u]nless prior arrangements have been made, only the full amount due will be accepted." (Id.)

Plaintiff contacted her " single point of contact" at Citi, Raymond Bookey, to ask why her second Trial Plan payment was rejected and to explain that a " prior arrangement" - the Trial Plan itself - had in fact been made. Mr. Bookey only responded that Citi " would never say why the payment was rejected, " and that Plaintiff " can get an attorney to subpoena it." Plaintiff also spoke with a manager at Citi named Jose Gigini, who told Plaintiff that it was " illegal" for Citi to refuse the payments, but that Citi employees " would get bonuses for not qualifying borrowers for modifications." Defendants never requested any additional documents in connection with the Trial Plan.

Citi and U.S. Bank, through Clear Recon, recorded (1) a notice of default on the Subject Property on February 10, 2014, (2) a notice of trustee's sale on the Subject Property on May 21, 2014, and (3) a notice of trustee's sale on the Subject Property on June 16, 2014, which set a trustee's sale date of July 17, 2014.

In the meantime, given Citi's refusal to discuss the Trial Plan further, Plaintiff applied for another loan modification, which Citi denied in a letter dated July 31, 2014. The only reason given for the denial was that " [t]here was an irreconcilable discrepancy within [Plaintiff's] application request." (FAC, Ex. M.) Plaintiff appealed this denial in a timely letter dated August 29, 2014. (Id. at Ex. N.) That letter states that Plaintiff's counsel contacted Moving Defendants' counsel on August 5, 2013 to clarify the reason for the denial, and that Moving Defendants' counsel indicated that based on his understanding at the time, Plaintiff's application was denied because the gross monthly income she listed did not match the documents she attached to verify proof of income. Plaintiff's August 29, 2014 letter re-attached a copy of the application as well as the supporting income documentation, and attempted to explain that no discrepancy existed. Citi responded with a letter dated September 17, 2014, which again simply informed Plaintiff that Citi was " unable to approve [her] mortgage assistance request" because that request contained an " irreconcilable discrepancy." (Id. at Ex. O.) Citi did not provide any further explanation or information.

The parties state that due to two postponements thus far, the most recent date set for the trustee's sale on the Subject Property was December 4, 2014.

III. JUDICIAL STANDARD

The federal pleading standard states in relevant part that " a claim for relief must contain . . . a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). Under Rule 12(b)(6), a party may move to dismiss for failure to state a claim upon which relief can be granted. In deciding a Rule 12(b)(6) motion, the court must assume allegations in the challenged complaint are true, and construe the complaint in the light most favorable to the non-moving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). However, a court need not accept as true unreasonable inferences, unwarranted deductions of fact, or conclusory legal allegations cast in the form of factual allegations. See W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). Furthermore, a pleading must contain sufficient factual matter that, if accepted as true, states a claim that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). A claim is facially plausible when there are sufficient factual allegations to draw a reasonable inference that the defendant is liable for the misconduct alleged. Id.

IV. DISCUSSION

Moving Defendants argue that each of Plaintiff's thirteen causes of action fails to state a claim, and the Court will address each in turn.

A. Violation of California Civil Code Section 2923.6(f)

Plaintiff alleges that Citi's July 31, 2014 and September 17, 2014 letters failed to provide her with sufficient reasons for denying her most recent application for a loan modification, in violation of California Civil Code Section[1] 2923.6(f). Section 2924.12(a)(1) then states that " [i]f a trustee's deed upon sale has not been recorded, a borrower may bring an action for injunctive relief to enjoin a material violation of, " among other sections, Section 2923.6.

Moving Defendants' Motion does not address Section 2923.6(f), or argue that any alleged violations are not " material" for purposes of Section 2924.12. Instead, it focuses on subdivisions (c) and (e) of Section 2923.6, though Plaintiff does not allege those subdivisions were violated. Defendant has thus failed to show that Plaintiff's first cause of action fails to state a claim.

B. Violation of California Civil Code Section 2924.11(a), Fraud, Promissory Estoppel, and Breach of Contract

Plaintiff's second, fifth, tenth, and eleventh causes of action allege, respectively, violation of Section 2924.11(a) (prohibiting the recording of a notice of default under certain circumstances), fraud, promissory estoppel, and breach of contract. With regard to all four causes of action, Moving Defendants request that the Court take judicial notice of letters Citi purportedly sent to Plaintiff on August 14, 2013 and September 11, 2013, which are attached as Exhibits 7 and 8 to Moving Defendants' Request for Judicial Notice (" RJN"). ( See ECF No. 20.) These letters purport to inform Plaintiff that Citi was " unable to approve a HAMP modification of [her] mortgage terms" because " there was an irreconcilable discrepancy within [her] application request." (Defs.' RJN, Exs. 7-8.)

First, Moving Defendants argue these letters show that a foreclosure prevention alternative was not " approved in writing, " which is necessary for Section 2924.11 to apply. Next, Moving Defendants assert that the letters show Plaintiff's failure to " demonstrate" that Defendants made any false statements regarding the Trial Plan, as required for the fraud claim. Finally, Moving Defendants argue that the letters show Plaintiff's failure to " demonstrate that Citi breached a clear and unambiguous promise or any term or provision of the alleged July 30, 2013 HAMP trial period plan in order to state claims for promissory estoppel and breach of contract." (Defs.' Mot. 9:17-20.)

However, Moving Defendants' request that the Court take judicial notice of its Exhibits 7 and 8 is improper. That request relies upon the " incorporation by reference" doctrine, which permits a court " to take into account documents 'whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the [plaintiff's] pleading.'" Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005). The Ninth Circuit has " extended the 'incorporation by reference' doctrine to situations in which the plaintiff's claim depends on the contents of a document, the defendant attaches the document to its motion to dismiss, and the parties do not dispute the authenticity of the document, even though the plaintiff does not explicitly allege the contents of that document in the complaint." Id. (emphasis added). As is apparent from these statements of the rule, the Court may not take judicial notice of documents whose authenticity is disputed. Here, Plaintiff vigorously disputes the authenticity of the two exhibits at issue. As Plaintiff notes in her Opposition, the FAC alleges that Citi did in fact offer Plaintiff a loan modification through the Trial Program, and that Citi had already accepted Plaintiff's first payment under the Trial Program by the time the September 11, 2013 letter was purportedly sent. ( See FAC ¶ ¶ 14-15, Exs. F-G.) Moreover, the alleged reason Citi gave for rejecting Plaintiff's second payment under the Trial Program was that the payment was less than the full amount to bring the loan current, not that Plaintiff had been dropped from the Trial Program. (Id. at ¶ ¶ 16-17, Ex. I.)

Even if the Court could take judicial notice of the documents themselves, it could not take notice of the truth of the facts asserted within the documents - i.e., that there was an irreconcilable discrepancy within Plaintiff's application request. ( See United States v. Corinthian Colls., 655 F.3d 984, 999 (9th Cir. 2011) (" Here, we can consider the existence of the reports identified by EY . . . . Nonetheless, we may not, on the basis of these reports, draw inferences or take notice of facts that might reasonably be disputed.") (emphasis in original). Such notice would be required for the majority of Moving Defendants' above arguments.

Because the Court cannot take judicial notice of Exhibits 7 and 8 to Moving Defendants' RJN, Moving Defendants' arguments regarding the second, fifth, tenth, and eleventh causes of action fail.

C. Violation of California Civil Code Section 2923.55

Plaintiff alleges that Defendants violated Section 2923.55 by recording a notice of default prior to complying with the requirements set forth in subdivisions (a)(1) and (a)(2). Section 2924.12(a)(1) provides for injunctive relief to enjoin a material violation of Section 2923.55.

First, Section 2923.55(a)(1) requires the mortgage servicer to satisfy the requirements of subdivision (b)(1) of the same section. That subdivision, in turn, requires that the mortgage servicer send the borrower, in writing, (1) a statement that if the borrower is a servicemember or dependent thereof, she may be entitled to certain protections under the federal Servicemembers Relief Act, and (2) a statement that the borrower may request (a) a copy of her promissory note or other evidence of indebtedness, (b) a copy of her deed of trust or mortgage, (c) a copy of any assignment of those documents, if applicable, and (d) a copy of the borrower's payment history since the borrower was last less than 60 days past due. Plaintiff alleges that she never received such statements in writing. (FAC ¶ ¶ 50-51.)

Moving Defendants request that the Court take judicial notice of two letters from Citi to Plaintiff which purportedly contain the required information. However, Plaintiff disputes that she received this information, and the Court cannot resolve the factual dispute at this stage by taking judicial notice of these documents.

Second, Section 2923.55(a)(2) provides that 30 days must pass after " initial contact is made as required by paragraph (2) of subdivision (b), " or after satisfaction of the " due diligence requirements described in subdivision (f)." Subdivision (b)(2) provides:

A mortgage servicer shall contact the borrower in person or by telephone in order to assess the borrower's financial situation and explore options for the borrower to avoid foreclosure. During the initial contact, the mortgage servicer shall advise the borrower that he or she has the right to request a subsequent meeting and, if requested, the mortgage servicer shall schedule the meeting to occur within 14 days. The assessment of the borrower's financial situation and discussion of options may occur during the first contact, or at the subsequent meeting scheduled for that purpose. In either case, the borrower shall be provided the toll-free telephone number made available by the United States Department of Housing and Urban Development (HUD) to find a HUD-certified housing counseling agency. Any meeting may occur telephonically.

Cal. Civ. Code § 2923.55(b)(2).

Plaintiff alleges that Defendants did not satisfy any of subdivision (b)(2)'s requirements. (FAC ¶ ¶ 52-53.) Moving Defendants again assert that the two letters referenced above, as well as a notice of default, satisfy these requirements, and again improperly request that the Court take judicial notice of these documents. The Court reiterates that it cannot resolve such a factual dispute at this stage of the proceedings. Further, Section 2923.55(b)(2) expressly requires that contact be made " in person or by telephone." Thus, even if the Court were to take judicial notice of these documents, they would be insufficient to satisfy the statute's plain requirements.

Moving Defendants cite Johnson v. SunTrust Mortgage, Inc., No. CV 14-2658 DSF (PJWx), 2014 WL 3845205, at *4 (C.D. Cal. Aug. 4, 2014), for the proposition that Section 2923.55(b)(2) is satisfied where a plaintiff concedes that she " had several discussions . . . regarding loan modification" with a mortgage servicer prior to the notice of default. ( See Defs.' Mot. 10:15-20.) However, nowhere does Plaintiff concede that she had any such discussions. To the contrary, the FAC alleges that Plaintiff's single point of contact at Citi, Raymond Bookey, told her that Citi " would never say why" her second payment under the Trial Plan was rejected, and that Plaintiff would need to " get an attorney and subpoena" any such information. (FAC ¶ 18.)

Moving Defendants do not take issue with Plaintiff's allegations of non-compliance with the due diligence requirements described in Section 2923.55(f), the alternative subdivision under Section 2923.55(a)(2).

For the foregoing reasons, Moving Defendants' arguments with respect to Plaintiff's third cause of action fail.

D. Violation of California Civil Code Section 2923.7

Plaintiff alleges that Defendants violated Section 2923.7, which provides that when a borrower " requests a foreclosure prevention alternative, the mortgage servicer shall promptly establish a single point of contact and provide to the borrower one or more direct means of communication with the single point of contact." Cal. Civ. Code § 2923.7(a). Plaintiff alleges that she was not assigned one single point of contact (" SPOC"), but was instead " repeatedly re-assigned to new SPOCs, including Raymond Bookey and Pamela Theodore . . . ." (FAC ¶ 61.) Moving Defendants counter that a " single point of contact" may consist of a " team of personnel each of whom has the ability and the authority to perform the responsibilities described" in Section 2923.7. Cal. Civ. Code § 2923.7(e). However, Plaintiff does not allege that she was re-directed to different members of a team which comprised her SPOC; she alleges that the SPOCs themselves changed. This is prohibited by the statute. See Cal. Civ. Code § 2923.7(c) (" The single point of contact shall remain assigned to the borrower's account until the mortgage servicer determines that all loss mitigation options offered by, or through, the mortgage servicer have been exhausted or the borrower's account becomes current."); Mann v. Bank of Am., N.A., No. 5:13-cv-02293-CAS (DTBx), 2014 WL 495617, at *4 (C.D. Cal. Feb. 3, 2014) (denying motion to dismiss cause of action for violation of Section 2923.7 where plaintiffs alleged that defendant " shuffled them from SPOC to SPOC.").

Moving Defendants also argue the FAC fails to demonstrate that Defendants violated any of the remaining requirements for SPOCs, which are set forth in Section 2923.7(b)-(d). Moving Defendants point to allegations in Plaintiff's original Complaint that Citi sent Plaintiff a letter on or about July 7, 2014 acknowledging receipt of Plaintiff's first lien loan modification application, and to various other notices regarding Plaintiff's applications of which the Court may not take judicial notice. ( See Defs.' Mot. 11:21-12:2.) Moving Defendants presumably contend, though they do not so state, that these allegations pertain to the requirements of subsections (b)(2) and (b)(3), which provide that the SPOC shall be responsible for " [c]oordinating receipt of all documents associated with the available foreclosure prevention alternatives, " and " [h]aving access to current information and personnel sufficient to timely, accurately, and adequately inform the borrower of the current status of the foreclosure prevention alternative." Cal. Civ. Code § 2923.7(b)(2)-(3). Yet Plaintiff alleges violations of additional responsibilities which Moving Defendants do not address. For example, Plaintiff alleges that one SPOC " outright informed Plaintiff that she could not qualify for a modification, rather than review Plaintiff for a modification in good faith, " in violation of Section 2923.7(b)(4), which requires that a SPOC " ensur[e] that a borrower is considered for all foreclosure prevention alternatives." Plaintiff also alleges that the various SPOCs refused to transfer her to a supervisor, in violation of Section 2923.7(d).

Finally, Moving Defendants argue that Plaintiff's claim fails because she does not allege that she suffered " actual economic damages." However, Plaintiff need not allege actual economic damages to obtain the injunctive relief she seeks under Section 2924.12(a). The authority to which Moving Defendants cite refers to claims falling under Section 2924.12(b), which applies after a trustee's deed upon sale has been recorded.

E. Intentional and Negligent Interference with Prospective Economic Advantage

The FAC alleges causes of action for intentional and negligent interference with prospective economic advantage against Citi, the servicer of the loan, and Clear Recon, the trustee under the deed of trust. Plaintiff alleges an economic relationship between herself and U.S. Bank, the beneficiary under the deed of trust, whereby Plaintiff " expected the probable future economic benefits of owning the Subject Property free and clear along with equity growth in the Subject Property, " and U.S. Bank " expected interest income under the Loan Agreement." (FAC ¶ 110.) Plaintiff further alleges that Citi and Clear Recon interfered with the relationship between Plaintiff and U.S. Bank by " wrongfully and without authorization recording a [notice of default] and subsequent [notices of trustee's sale], and instituting eviction proceedings against Plaintiff" without first satisfying the applicable requirements of the California Civil Code. (Id. at ¶ ¶ 112-113.)

Moving Defendants respond that " [a]ll of Citi's conduct" was " consistent with and in furtherance of U.S. Bank's rights and interests under plaintiff's note and deed of trust, " and that " [n]one of Citi's purported acts resulted in a breach of the note or deed of trust." (Defs.' Mot. 13:18-22.) Yet Moving Defendants do not explain or provide authority for their assertion that, as a result, " plaintiff does not and cannot show that Citi disrupted or interfered with the relationship between plaintiff and U.S. Bank or any third party." (Id. at 13:22-25.) Even assuming Citi did act in furtherance of U.S. Bank's rights and interests, that does not necessarily preclude a finding that Citi disrupted the relationship between Plaintiff and U.S. Bank, thereby causing Plaintiff economic harm. Moving Defendants have not cited any authority which would indicate that Citi is shielded from tort liability for interference simply because it services loans of which U.S. Bank is the beneficiary. While California courts have found that " an agent acting within the course and scope of his agency cannot be liable for interfering with his principal's economic relations with third parties, " Rie v. Bank of Am., N.A., No. B169668, 2005 WL 39865, at *7 (Cal.Ct.App. Jan. 10, 2005) (citing Filippo Indus., Inc. v. Sun Ins. Co., 74 Cal.App.4th 1429, 1443, 88 Cal.Rptr.2d 881 (1999)), the FAC does not allege that Citi or Clear Recon were agents of U.S. Bank. Moreover, the alleged interference torts are distinct from the tort of inducing breach of contract, and breach of a contract is not an element. Thus, Moving Defendants' asserted fact that Citi's acts did not result in a breach of the note or deed of trust is not dispositive.

Therefore, Moving Defendants have not met their burden of showing that Plaintiff's seventh and eighth causes of action fail to state a claim.

F. Negligence

Plaintiff alleges that Defendants breached their duty of care to review Plaintiff for loss mitigation options in a commercially reasonable manner, thus giving rise to a cause of action for negligence.

Moving Defendants argue that they do not owe a legal duty of due care to Plaintiff, and cite Nymark v. Heart Federal Savings and Loan Association, 231 Cal.App.3d 1089, 283 Cal.Rptr. 53 (1991), for the proposition that, " as a general rule, a financial institution owes no duty of care to a borrower when the institution's involvement in the loan transaction does not exceed the scope of its conventional role as a mere lender of money." Id. at 1096. In Lueras v. BAC Home Loans Servicing, LP, 221 Cal.App.4th 49, 163 Cal.Rptr.3d 804 (2013), the court considered a claim for negligence due to the defendant's alleged failure to offer the plaintiff a loan modification, and found that a residential lender does not owe a common law duty of care " to offer, consider, or approve a loan modification, or to explore and offer foreclosure alternatives." Id. at 67.

However, in Alvarez v. BAC Home Loans Servicing, LP, 228 Cal.App.4th 941, 176 Cal.Rptr.3d 304 (2014), the court considered a claim for negligence where " plaintiffs d[id] not allege that defendants owed plaintiffs a duty to offer or approve a loan modification. Rather, they allege[d] that defendant owed them a duty to exercise reasonable care in the review of their loan modification applications once they had agreed to consider them." Id. at 944. The court applied the six-factor test for determining whether a financial institution owes a duty of care to a borrower-client, and held that where defendants agree to consider modification of a plaintiff's loan, those factors " clearly weigh in favor" of a " duty to use reasonable care in the processing of [the] loan modification." Id. at 948-951.

Here, as in Alvarez, Plaintiff alleges that Defendants owed her a duty to exercise reasonable care in reviewing and processing her loan modification application once Defendants had agreed to consider it. Contrary to Moving Defendants' assertion, and as the Alvarez court held, Defendants did owe Plaintiff such a duty. Therefore, Moving Defendants' argument fails.

G. Quiet Title and Declaratory Relief

Plaintiff seeks to quiet title to the Subject Property as of February 10, 2014, the date the first notice of default was recorded. Plaintiff also requests a judicial determination of the rights, obligations, and interests of the parties as to the Subject Property and the Trial Plan.

Moving Defendants argue that " plaintiff is required to tender the full amount due under her loan in order to challenge any trustee's sale of the property." (Defs.' Mot. 15:11-12.) " The California Court of Appeal has held that the tender rule applies in an action to set aside a trustee's sale for irregularities in the sale notice or procedure and has stated that '[t]he rationale behind the rule is that if plaintiffs could not have redeemed the property had the sale procedures been proper, any irregularities in the sale did not result in damages to the plaintiffs.'" Cohn v. Bank of Am., No. 2:10-cv-00865 MCE KHN PS, 2011 WL 98840, at *9 (E.D. Cal. Jan. 12, 2011) (quoting FCPI RE-HAB 01 v. E & G Invs., Ltd., 207 Cal.App.3d 1018, 1021, 255 Cal.Rptr. 157 (1989)).

However, " the tender rule is not absolute and '[a] tender may not be required where it would be inequitable to do so.'" Sacchi v. Mortg. Elec. Registration Sys., Inc., No. CV 11-1658 AHM (CWx), 2011 WL 2533029, at *10 (C.D. Cal. June 24, 2011) (quoting Onofrio v. Rice, 55 Cal.App.4th 413, 424, 64 Cal.Rptr.2d 74 (1997)) (internal quotation omitted). Courts have declined to require tender of the full amount due under the loan where the plaintiff is contesting the validity of the foreclosure sale itself, rather than (or in addition to) irregularities in the sale procedures. See Barrionuevo v. Chase Bank, N.A., 885 F.Supp.2d 964, 969 (N.D. Cal. 2012); Vissuet v. Indymac Mortg. Servs., No. 09-CV-2121-IEG (CAB), 2010 WL 1031013, at *3 (S.D. Cal. Mar. 19, 2010) (" [B]ecause Plaintiff alleges improprieties with the origination and servicing of her loan, and because the trustee sale has not taken place yet, the Court declines to require Plaintiff to make or allege an actual tender at this time.").

In Mabry v. Superior Court, 185 Cal.App.4th 208, 110 Cal.Rptr.3d 201 (2010), the California Court of Appeal held that the plaintiffs were not required to tender all arrearages to enjoin foreclosure proceedings where they alleged that the lender had violated a requirement of California Civil Code Section 2923.5 which is identical to the requirement contained in Section 2923.55(b)(2), the same subsection Plaintiff alleges was violated in this case. Id. at 225-26. The court explained that

it would defeat the purpose of the statute to require the borrower to tender the full amount of the indebtedness prior to any enforcement of the right - and that's the point - the right to be contacted prior to the notice of default. Case law requiring payment or tender of the full amount of payment before any foreclosure sale can be postponed arises out of a paradigm where, by definition, there is no way that a foreclosure sale can be avoided absent payment of all the indebtedness. Any irregularities in the sale would necessarily be harmless to the borrower if there was no full tender. By contrast, the whole point of section 2923.5 is to create a new, even if limited, right to be contacted about the possibility of alternatives to full payment of arrearages. It would be contradictory to thwart the very operation of the statute if enforcement were predicated on full tender.

Id. at 225 (emphasis in original) (citations omitted).

Because Plaintiff is challenging the validity of the scheduled foreclosure sale, the Court finds that it would be inequitable to require Plaintiff to tender the outstanding amount of her loan, or allege such tender, at this time.

H. Unfair Competition

Plaintiff alleges that the complained-of actions on the part of Defendants constitute violations of California's Unfair Competition Law, set forth in California Business & Professions Code Sections 17200 et seq .

Moving Defendants first argue Plaintiff fails to sufficiently allege that Defendants' purported conduct was unlawful, unfair, or fraudulent, in violation of the applicable code provisions, because all of Plaintiff's other causes of action fail as a matter of law. As the Court holds that Plaintiff's other causes of action do not fail as a matter of law, Moving Defendants' argument is unavailing.

Moving Defendants next argue that Plaintiff fails to allege that she sustained any injury through the loss of money or property, and thus lacks standing to state a claim. However, Plaintiff alleges that as a result of Defendants' purportedly unlawful, unfair, and fraudulent practices, she was charged mortgage payments much higher than those she was entitled to pay pursuant to the Trial Plan, and also suffered related fees and costs. ( See FAC ¶ 105.) Additionally, an " alleged diminishment of a future property interest" resulting from the initiation of nonjudicial foreclosure proceedings on a plaintiff's home satisfies the economic injury requirement. Jenkins v. JP Morgan Chase Bank, N.A., 216 Cal.App.4th 497, 522, 156 Cal.Rptr.3d 912 (2013). Therefore, Plaintiff has alleged economic injury sufficient to demonstrate standing to bring her claim for unfair competition.

V. CONCLUSION

For the foregoing reasons, the Court DENIES Moving Defendants' Motion to Dismiss.

IT IS SO ORDERED.


Buy This Entire Record For $7.95

Official citation and/or docket number and footnotes (if any) for this case available with purchase.

Learn more about what you receive with purchase of this case.