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Alborzian v. Jpmorgan Chase Bank, N.A.

California Court of Appeals, Second District, Second Division

March 12, 2015

AFSHEEN ALBORZIAN et al., Plaintiffs and Appellants,
v.
JPMORGAN CHASE BANK, N.A. et al. Defendants and Respondents.

APPEAL from a judgment of the Superior Court of Los Angeles County No. BC482047. Elihu M. Berle, Judge.

Page 30

[Copyrighted Material Omitted]

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[Copyrighted Material Omitted]

Page 32

COUNSEL

Cohen McKeon, Michael L. Cohen, Heather M. McKeon; Law Offices of Neil R. Anapol and Neil R. Anapol, for Plaintiffs and Appellants.

Page 33

Arthur D. Levy, Elizabeth S. Letcher, Noah Zinner for Housing and Economic Rights Advocates and Public Counsel as Amici Curiae on behalf of Plaintiffs and Appellants.

Arnold & Porter, Peter Obstler, Marjory Gentry and Ginamarie Caya, for Defendant and Respondent JPMorgan Chase Bank, N.A.

Ellis Law Group, Mark E. Ellis and Andrew M. Steinheimer, for Defendant and Respondent Professional Recovery Services, Inc.

OPINION

HOFFSTADT, J.

A lender who lends money used to purchase a parcel of property and who holds a junior lien on that property cannot sue the borrower personally for the loan balance if the senior lienholder who also contributed to the purchase of the property forecloses on the property but does not collect enough from the foreclosure sale to pay off the junior lienholder. (Code Civ. Proc., former § 580b, as amended by Stats. 1989, ch. 698, § 12, p. 2289.)[1] Can the borrower sue the junior lienholder for trying to collect the no-longer-enforceable debt if the lienholder’s collection efforts inaccurately imply that the debt is still enforceable? We conclude that the borrower may sue the debt collector under the Fair Debt Collection Practices Act (FDCPA) (15 U.S.C. § 1692 et seq.); and may sue the junior lienholder or its debt collector under the Rosenthal Fair Debt Collection Practices Act (Rosenthal Act) (Civ. Code, § 1788 et seq.) and the unfair competition law (UCL) (Bus. & Prof. Code, § 17200 et seq.). However, the borrower may not sue for violations of the Consumers Legal Remedies Act (CLRA) (Civ. Code, § 1750 et seq.). We accordingly affirm in part and reverse in part the trial court’s order sustaining the lienholder’s and debt collector’s demurrers.

FACTUAL AND PROCEDURAL BACKGROUND

Afsheen and Fabiola Alborzian (plaintiffs) took out two loans to purchase their home in 2005, each secured by a deed of trust on the home. Wells Fargo had the senior lien, and defendant JPMorgan Chase Bank, N.A. (Chase) had the junior lien. Wells Fargo subsequently foreclosed on the property, but the proceeds from the sale were not enough to pay off Chase’s loan.

About a year after the foreclosure sale, Chase sent a letter to plaintiffs captioned “Opportunity for Assistance.” The ...


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