Bever v. Cal-Western Reconveyance Corp. et al

Filing 19

ORDER GRANTING PLAINTIFF'S RENEWED MOTION FOR A TEMPORARY RESTRAINING ORDER Motion Hearing set for 11/14/2011 at 01:30 PM in Courtroom 2 (AWI) before Chief Judge Anthony W. Ishii.) signed by Chief Judge Anthony W. Ishii on 10/26/2011. (Nazaroff, H)

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IN THE UNITED STATES DISTRICT COURT FOR THE
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EASTERN DISTRICT OF CALIFORNIA
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GLENN W. BEVER,

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Plaintiff,
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v.
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CAL-WESTERN RECONVEYANCE
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CORP.; CITIMORTGAGE, INC.;
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MORTGAGE ELECTRONIC
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REGISTRATION SYSTEMS, INC.
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Defendants.
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____________________________________)

1:11-CV- 1584 AWI SKO
ORDER GRANTING
PLAINTIFF’S RENEWED
MOTION FOR A
TEMPORARY RESTRAINING
ORDER
(Doc. #16)

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BACKGROUND
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On September 20, 2011, Plaintiff filed an ex parte motion for a temporary restraining
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order.

Plaintiff sought an order restraining and enjoining Defendant Cal-Western

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Reconveyance Corp. from selling Plaintiff’s home located at 466 West Tenaya Avenue, Clovis,
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CA 93612 (“the Property). The court reviewed Plaintiff’s motion, the complaint, and supporting
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documents. The court did not find good cause to issue a temporary restraining order. While
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Plaintiff contended that Defendant Cal-Western Reconveyance Corporation (Defendant Cal23
Western) had no legal authority to sell Plaintiff’s property, no documents were attached to the
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complaint or motion for a temporary restraining order. Thus, on September 23, 2011, the court
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denied Plaintiff’s motion for a temporary restraining order without prejudice.1

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On October 12, 2011, Defendants filed a motion to dismiss. The motion to dismiss is
set before the court for oral argument on November 14, 2011.

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On or about September 6, 2011, Defendant Cal-Western appears to have mailed Plaintiff

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a Notice of Trustee Sale, which had been filed in the Fresno County Recorder’s Office. The

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Trustee Sale was noticed for September 27, 2011, but subsequently rescheduled for October 27,

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2011.

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On October 19, 2011, Plaintiff filed a Renewed Motion for a Temporary Restraining

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order. Among other allegations, Plaintiff provides evidence that Defendants did not comply

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with California Civil Code § 2923.5. The Renewed Motion for a Temporary Restraining order

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contends that Defendant Cal-Western, without having been properly substituted in as trustee

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under the deed of trust, commenced foreclosure proceedings by recording a Notice of Default in

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the Fresno County Recorder’s office. The Notice of Default indicates that, pursuant to California

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Civil Code § 2923.5(b), the provisions of California Civil Code § 2923.5 have been complied

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with. Plaintiff provides a declaration, signed under penalty of perjury, that he never received the

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Notice of Default nor was there any attempt to contact him as required by California Civil Code

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§ 2923.5

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LEGAL STANDARD
Under Rule 65(b), a court may issue an ex parte temporary restraining order only if: (1) it

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clearly appears . . . that immediate and irreparable injury, loss, or damage will result to the

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applicant before the adverse party or that party's attorney can be heard in opposition, and (2) the

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applicant’s attorney certifies to the court in writing the efforts, if any, which have been made to

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give the notice and the reasons supporting the claim that notice should not be required. Fed. R.

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Civ. Pro. 65(b); Reno Air Racing Ass'n v. McCord, 452 F.3d 1126, 1130 (9th Cir. 2006). Rule

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65(b)’s requirements are “stringent,” and temporary restraining orders that are granted ex parte

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are to be “restricted to serving their underlying purpose of preserving the status quo and

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preventing irreparable harm just so long as is necessary to hold a hearing, and no longer.”

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Granny Goose Foods, Inc. v. Brotherhood of Teamsters, 415 U.S. 423, 438-39 (1974); McCord,

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452 F.3d at 1131.

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The substantive standard for granting a temporary restraining order is the same as the
standard for entering a preliminary injunction. Bronco Wine Co. v. U.S. Dep't of Treasury, 997
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F.Supp. 1309, 1313 (E.D. Cal. 1996); Lockheed Missile & Space Co. v. Hughes Aircraft Co.,

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887 F.Supp. 1320, 1323 (N.D. Cal. 1995); see also Welker v. Cicerone, 174 F.Supp.2d 1055,

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1062 (C.D. Cal. 2001). A plaintiff seeking a preliminary injunction must establish: (1) that he is

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likely to succeed on the merits, (2) that he is likely to suffer irreparable harm in the absence of

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preliminary relief, (3) that the balance of equities tips in his favor, and (4) that an injunction is in

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the public interest. Winter v. Natural Res. Def. Council, Inc., 129 S.Ct. 365, 374 (2008); Park

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Vill. Apt. Tenants Ass'n v. Mortimer Howard Trust, 636 F.3d 1150, 1160 (9th Cir. 2011).

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“Injunctive relief . . . must be tailored to remedy the specific harm alleged.” Park Vill., 636 F.3d

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at 1160.

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DISCUSSION

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A temporary restraining order is warranted. First, disregarding Plaintiff’s other claims,

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Plaintiff has shown a likelihood of success on his claims under California Civil Code § 2923.5.

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As part of the Renewed Motion for a Temporary Restraining order, Plaintiff submits a

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declaration that no Defendant contacted him before the Notice of Default was filed and no

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Defendant ever contacted him for the purpose of exploring options to avoid foreclosure.

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addition, Plaintiff states under penalty of perjury that he was never served with the Notice of

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Default. Civil Code § 2923.5 requires that, 30 days before a notice of default is filed, the

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mortgagee, beneficiary, or authorized agent “shall contact the buyer in person or by telephone in

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order to assess the borrower’s financial situation and explore options for the borrower to avoid

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foreclosure.” Cal. Civ. Code. § 2923.5(a);

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As part of the Renewed Motion for a Temporary Restraining order, Plaintiff submits a

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declaration that no Defendant contacted him before the Notice of Default was filed and no

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Defendant contacted him for the purpose of exploring options to avoid foreclosure. See Cal. Civ.

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Code. § 2923.5; Argueta v. J.P. Morgan Chase, 787 F.Supp.2d 1099, 1107,(E.D.Cal. 2011); Paik

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v. Wells Fargo Bank, N.A., 2011 WL 109482, at *3 (N.D.Cal. Jan. 13, 2011); Mabry v. Superior

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Ct., 185 Cal.App.4th 208, 220 & n.6 (2010). The remedy for a violation of § 2923.5 is

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postponement of the foreclosure sale until there has been compliance with the statute. Argueta,

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787 F.Supp. At 1107. Plaintiff’s declaration states, under penalty of perjury, that § 2923.5 was
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not followed. While accompanying Defendants’ motion to dismiss are documents claiming §

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2923.5 was followed, the allegations in the complaint create a disputed issue of fact at this stage

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of the litigation on whether and how Plaintiff was contacted. Accordingly, the court concludes

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that Plaintiff has established serious questions going to the merits on his § 2923.5 claim. See

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also Tamburri v. Suntrust Mortg., Inc., 2011 WL 2654093, at * 4 (N.D.Cal. July 6, 2011).

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In addition, without a Temporary Restraining Order, Plaintiff would suffer irreparable

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harm. As stated above, the remedy for a violation of § 2923.5 is postponement of the foreclosure

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sale. However, once a foreclosure sale occurs, there is no relief available under § 2923.5. See

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Mehta v. Wells Fargo Bank, N.A., 737 F.Supp.2d 1185, 1194 (S.D. Cal. 2010). Further, since a

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violation of § 2923.5 does not place a cloud on the title, see Mabry, 189 Cal.App.4th at 223, the

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possible loss of Plaintiff’s right to the Property would not be reparable. The loss of one's home

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through foreclosure generally is considered sufficient to establish irreparable harm. Tamburri,

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2011 WL 2654093, at *2 (N.D. Cal. July 6, 2011); Washington v. National City Mortg. Co.,

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2010 WL 5211506, at 15 (N.D.Cal. Dec. 16, 2010). Thus, Plaintiff has sufficiently demonstrated

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irreparable harm.

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With respect to the balancing of the equities and the public interest, the Defendants’

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interests are secured by the Deed of Trust. Further, the court will require further briefing and

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allow Defendants to provides further evidence before any preliminary injunction is granted in this

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action. Finally, since the trustee sale is set to occur on October 27, 2011, the court does not

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believe that further notice, beyond Plaintiff’s certificate of service on Defendants of the renewed

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motion for a temporary restraining order, is practicable.

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CONCLUSION AND ORDER
Plaintiff moves for a temporary restraining order that would restrain Defendants from

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conducting a trustee sale on the Property. After considering the renewed motion, Plaintiff has

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sufficiently established a likelihood of success, irreparable injury, and that the balance of

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hardships and public interest weigh in his favor. As such, the court will grant Plaintiff’s request

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for a temporary restraining order.

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Accordingly, IT IS HEREBY ORDERED that:

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Plaintiff’s renewed motion for a temporary restraining order is GRANTED;

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Defendants are RESTRAINED from proceeding with the Trustee Sale, currently

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set for October 27, 2011, until further order of the court;
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Defendants shall appear on November 14, 2011, 2011, at 1:30 p.m. in Courtroom

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Two and SHOW CAUSE why a Preliminary Injunction should not be granted that

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restrains and enjoins Defendants from proceeding with the Trustee Sale;

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4.

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Defendants shall file an opposition to Plaintiff’s request for preliminary injunction
on or by 3:00 p.m. on November 1, 2011; and

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Plaintiff shall file any reply on or by 3:00 p.m. on November 7, 2011.

IT IS SO ORDERED.

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Dated:
0m8i78

October 26, 2011
CHIEF UNITED STATES DISTRICT JUDGE

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