United States District Court, S.D. California
AMOR MEDINA DEL ROSARIO AND ELVIE CANLAS DEL ROSARIO, Plaintiffs,
WELLS FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE FOR THE MERRILL LYNCH MORTGAGE INVESTORS TRUST, SERIES 2006-F1.; PNC MORTGAGE, INC., FKA NATIONAL CITY MORTGAGE COMPANY, Defendants.
ORDER GRANTING DEFENDANTS' MOTION TO DISMISS
PLAINTIFFS' FIRST AMENDED COMPLAINT
Roger T. Benitez United States District Judge.
Wells Fargo Bank, National Association, as Trustee for the
Merrill Lynch Mortgage Investors Trust, Series 2006-F1, and
PNC Bank, N.A. (erroneously sued as PNC Mortgage, Inc., FKA
National City Mortgage Company) (“Defendants”)
have filed a Motion to Dismiss Plaintiffs Amor Medina Del
Rosario and Elvie Canlas Del Rosario's
(“Plaintiffs”) First Amended Complaint. (Mot.,
ECF No. 13.) For the reasons discussed below, the Motion is
proceeding pro se, have filed a complaint, seeking to avoid
nonjudicial foreclosure on a piece of residential property at
10685 Brookhollow Court, San Diego, California (the
“Subject Property”) that they own and occupy. On
October 20, 2016, this Court granted Defendants' motion
to dismiss Plaintiffs' original complaint on several
grounds. Plaintiffs thereafter filed a First Amended
Complaint. (FAC, ECF No. 12.) The First Amended Complaint
repeats the allegations of the initial complaint.
about December 29, 2005, Plaintiffs executed a promissory
note in the amount of $499, 000 for the Subject Property,
secured by a deed of trust. (FAC ¶ 14; Defs.'
Request for Judicial Notice (“RJN”) Ex.
The lender and beneficiary of the deed of trust was National
City Mortgage, a division of National City Bank of Indiana,
and now known as PNC Mortgage Inc. (Id. ¶¶
15, 17; RJN Ex. C.) National City Bank of Indiana was the
named trustee on the note and deed of trust. (Id.
¶ 16; RJN Ex. C.) Plaintiffs allege that there has been
“no documented assignment of the Note.” (FAC
fell behind on their payments. On August 6, 2009, Cal-Western
Reconveyance Company (“Cal-Western”) recorded a
Notice of Default. (Id. ¶ 76 & Ex. F.) The
Notice states that Cal-Western is “either the original
trustee, the duly appointed substituted trustee, or acting as
agent for the trustee or beneficiary under [the] deed of
trust.” (Id. Ex. F) Plaintiffs claim that
Cal-Western acted ultra vires and was never substituted as
trustee or authorized to act as an agent. (Id.
Notice of Default further states that “the mortgagee,
beneficiary or the mortgagee's or beneficiary's
authorized agent has either contacted the borrower or tried
with due diligence to contact the borrower as required by
California Civil Code 2923.5.” (Id.) But
Plaintiffs allege that they were never contacted prior to the
recording of the Notice of Default. (Id. ¶ 79.)
They claim that Defendants “did not review
Plaintiffs' financial situation and further did not
advise them of all options available to avoid
foreclosure.” (Id. ¶ 81, 83-84, 90-91.)
Plaintiffs contend these and other failures violated
California law, thereby nullifying Defendants' authority
to foreclose. (Id. ¶ 82.)
2010, Plaintiffs sued PNC Bank, Cal-Western, and Pacific Data
Mortgage in California state court to stop foreclosure on the
home. (Id. ¶ 49 & Ex. C.) In that lawsuit,
Plaintiffs alleged that the defendants fraudulently induced
them to enter the loan agreement on inferior terms and
wrongfully sought to foreclose on Plaintiffs when they were
not in default. (See Id. Ex. C.) Plaintiffs allege
that “both parties agreed to settle the manner by PNC
agreeing to provide Plaintiffs with an acceptable loan
modification, in exchange for Plaintiffs' agreement to
voluntarily dismiss the lawsuit.” (Id. ¶
52.) However, Plaintiffs contend that “PNC reneged on
the agreement, and failed to provide Plaintiffs with the loan
modification they were promised.” (Id. ¶
54.) Plaintiffs claim that this conduct by PNC constitutes
fraud. (See Id. ¶¶ 55-61.)
about May 9, 2012, Cal-Western Reconveyance Company recorded
a Notice of Trustee Sale, bearing instrument number
2012-0273037. (Id. ¶ 97 & Ex. G.)
Plaintiffs again contend that Cal-Western acted without
authority (id. ¶ 99-100), and that Defendants
did not review Plaintiffs' financial situation or advise
them of their options to avoid foreclosure (id.
¶¶ 101-02). Plaintiffs once more claim these
failures nullify Defendants' authority to foreclose.
(Id. ¶ 101.)
point, “Plaintiffs' loan was . . . sold into a
securitized Trust, entitled the Merrill Lynch Mortgage
Investors Inc., 2006-F1.” (Id. ¶ 23.) The
trust had a “cut-off date” of April 1, 2006, and
a “closing date” of April 28, 2006. (Id.
¶¶ 23, 29, 38.) “Plaintiffs' note and
loan were not transferred to the Merrill Lynch Securitized
Trust prior to its closing date.” (Id. ¶
September 25, 2015, PNC Bank recorded an Assignment of Deed
of Trust to “Wells Fargo Bank, N.A., as Trustee, for
Merrill Lynch Mortgage Investors Trust, Series MLMI
2006-F1” (“Wells Fargo”). (Id.
¶ 70, Ex. E.) The assignment made Wells Fargo the
beneficiary of the deed of trust. (Id. Ex. E.)
Plaintiffs allege that the assignment of the deed of trust
was ineffective, invalid, and void because it occurred after
the closing date of the Merrill Lynch securitized trust.
(See Id. ¶ 29-30, 34-35.) They also contend
that because “there has been no documented assignment
of the Note, . . . the [deed of trust] and note were not
properly transferred together, which consequently has
bifurcated the [deed of trust] and note, rendering them
unenforceable.” (Id. ¶ 24.)
November 25, 2015, Wells Fargo, as beneficiary under the deed
of trust, recorded a Notice of Rescission of Notice of
Default, bearing instrument number 2015-0613850.
(Id. ¶ 103 & Ex. H.) The Notice states that
Wells Fargo “does hereby rescind, cancel and withdraw
said Declaration of Default and Demand for Sale and said
Notice of Breach and Election to Cause Sale.”
(Id. Ex. H.) The Notice is signed by Bernis M.
Gonyea of Clear Recon Corp. (Id.) Plaintiffs allege
that Clear Recon Corp. is “the new foreclosing
trustee” but there is no “evidence of a recorded
Substitution of Trustee document authorizing Clear Recon.
Corp. to be substituted as trustee.” (Id.
April 29, 2016, PNC denied Plaintiffs hardship assistance on
their loan. (Id. ¶ 63 & Ex. D.) The letter
from PNC states that Plaintiffs' “loan on the
related property has received the maximum number of
foreclosure alternative options that are permitted by the
assignee or mortgage owner of your loan.” (Id.
Ex. D.) Challenging this decision, Plaintiffs contend that
they made “the requisite 3 trial payments which should
have resulted in a full and final modification.”
(Id. ¶ 63.)
bring three claims for relief. The first claim for relief
alleges wrongful foreclosure. The second claim for relief