Gilliland v. Chase Home Finance, LLC, et al.

Filing 20

ORDER signed by Judge John A. Mendez on 1/28/2014 ORDERING the Court GRANTS WITH PREJUDICE 7 Motion to Dismiss: Plaintiff's fifth cause of action for unfair business practices predicated on violation of Sections 2823.55, 2923.6, 2923.7, and 2923.5; plaintiff's sixth cause of action for breach of Sections 2923 and 2924; and plaintiff's seventh cause of action for dual tracking in violation of Civil Code Sections 2923 and 2924; The Court DISMISSES WITH LEAVE TO AMEND: plaintiff& #039;s first cause of action for breach of contract; plaintiff's second cause of action for breach of the covenant of good faith and fair dealing; plaintiff's third cause of action for wrongful foreclosure; plaintiff's fourth cause of action for misrepresentation; and plaintiff's fifth cause of action for unfair business practices predicated on violation of Sections 2924b, 2934a, and 2924.8; Plaintiff mus file her Amended Complaint within 20 days from the date of this Order; Defendants shall file their responsive pleading within 20 days thereafter; If Plaintiff elects not to file an Amended Complaint, she should file a notice of dismissal within the next 20 days. (Waggoner, D)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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KAYRINKIA J. GILLILAND,

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2:13-cv-02042 JAM-AC

Plaintiff,

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No.

v.

ORDER GRANTING DEFENDANTS’
MOTION TO DISMISS

CHASE HOME FINANCE, LLC;
CHASE HOME FINANCE, INC.; JP
MORGAN & COMPANY; JP MORGAN
CHASE; CHASE BANK USA; GLENN
J. MOURIDY; THOMAS WIND and
Does I-XX et al.,

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Defendants.
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Defendants JPMorgan Chase Bank, N.A. s/b/m to Chase Home

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Finance, LLC; JPMorgan Chase Bank, N.A.; and Chase Bank USA,

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N.A.’s (collectively “Defendants”) moved to dismiss Plaintiff’s

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complaint (Doc. #7).

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(“Plaintiff”) opposed the motion (Doc. #17-3) and Defendants

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replied (Doc. #19). 1

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Defendants’ motion is GRANTED.

Plaintiff Kayrinkia J. Gilliland

For the reasons set forth below,

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This motion was determined to be suitable for decision without
oral argument. E.D. Cal. L.R. 230(g). The hearing was scheduled
for December 11, 2013.
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I.

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FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND

Plaintiff filed this action on October 1, 2013 (Doc. #1).

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In the complaint, Plaintiff alleges seven causes of action

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against Defendants and Defendants Glenn J. Mouridy, Thomas Wind,

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Matthew E. Zames, James Dimon, Thomas E. Higgins, and James Bill:

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(1) breach of a written contract; (2) breach of covenant of good

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faith and fair dealing, (3) wrongful foreclosure,

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(4) misrepresentation, (5) unfair business practices pursuant to

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Business and Professional Code Section 17200 (“UCL claim”),

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(6) breach of California Civil Code Sections 2923 and 2924, and

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(7) dual tracking in violation of Civil Code Sections 2923 and

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2924.

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dismiss all seven claims (Doc. #7).

Compl. ¶¶ 34-75.

On October 29, 2013, Defendants moved to

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Based on the complaint and judicially noticeable facts,

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Plaintiff purchased the real property located at 1517 Los Robles

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Blvd, Sacramento, California, in 1982 (“Property”).

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Memorandum of Agreement of Sale, Ex. 1 to Defendants’ Request for

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Judicial Notice (“RJN”), Doc. #8.

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$145,000 mortgage loan from Defendants encumbering the Property.

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Deed of Trust, Ex. 3 to RJN, Doc. #8, at 1, 3.

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December 2009, Defendants allegedly notified Plaintiff that she

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was eligible for benefits under the federal government Home

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Affordable Modification Program (“HAMP”).

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notice stated that “If you comply with the terms of the Home

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Affordable Modification Trial Period Plan (‘Trial Period Plan’),

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Defendants promise to modify the terms of your home loan.”

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The trial period required three payments in January, February,

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and March of 2010, which Plaintiff allegedly made.
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Compl. ¶ 1;

In 2007, Plaintiff obtained a

On or about

Compl. ¶ 19.

The

Id.

Id. ¶¶ 20-21.

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Defendants allegedly accepted the payments.

Id. ¶ 22.

On or about March 31, 2010, Defendants wrote to Plaintiff

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and included the Home Affordable Modification Agreement

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(“Modification Agreement”), which Plaintiff contends she signed

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and returned on April 13, 2010, as required.

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Id. ¶ 23.

On or about April 16, 2010, Plaintiff allegedly received a

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phone call from John Pankow on behalf of Defendants who told

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Plaintiff that her home was not in foreclosure proceedings and

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promised that Defendants would not foreclose her home.

Id. ¶ 26.

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Plaintiff claims he also told her to stop making payments

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pursuant to the Modification Agreement because she would lose her

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money.

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representations and did not think her home would be foreclosed.

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Id. ¶ 27.

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Plaintiff in writing that she was in default and would be

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required within 32 days to pay more than $5,000 to cure her

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default.

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spoke with Defendants who told her not make payments, that she

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was being considered for a modification, and promised that

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Defendants would not foreclose her home.

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did not make payments pursuant to the Modification Agreement and

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her home was foreclosed.

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trustee’s sale in September 2011.

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8, RJN.

Id. ¶ 26.

Plaintiff allegedly relied on these

On or about May 29, 2010, Defendants notified

Id. ¶ 28.

On or about June 2010, Plaintiff allegedly

Id. ¶ 31.

Id. ¶ 29.

Plaintiff

The property was sold at a
Trustee’s Deed Upon Sale, Ex.

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II.

OPINION

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A.

Legal Standard

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A party may move to dismiss an action for failure to state a
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claim upon which relief can be granted pursuant to Federal Rule

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of Civil Procedure 12(b)(6).

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plaintiff must plead “enough facts to state a claim to relief

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that is plausible on its face.”

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556 U.S. 662, 570 (2007).

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district court must accept all the allegations in the complaint

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as true and draw all reasonable inferences in favor of the

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plaintiff.

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overruled on other grounds by Davis v. Scherer, 468 U.S. 183

To survive a motion to dismiss a

Bell Atlantic Corp. v. Twombly,

In considering a motion to dismiss, a

Scheuer v. Rhodes, 416 U.S. 232, 236 (1974),

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(1984); Cruz v. Beto, 405 U.S. 319, 322 (1972).

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entitled to the presumption of truth, allegations in a complaint

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or counterclaim may not simply recite the elements of a cause of

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action, but must sufficiently allege underlying facts to give

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fair notice and enable the opposing party to defend itself

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effectively.”

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2011), cert. denied, 132 S. Ct. 2101, 182 L. Ed. 2d 882 (U.S.

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2012).

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must plausibly suggest an entitlement to relief, such that it is

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not unfair to require the opposing party to be subjected to the

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expense of discovery and continued litigation.”

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that are mere “legal conclusions” are therefore not entitled to

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the presumption of truth.

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(2009) (citing Twombly, 550 U.S. at 555).

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appropriate when a plaintiff fails to state a claim supportable

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by a cognizable legal theory.

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Department, 901 F.2d 696, 699 (9th Cir. 1990).

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“First, to be

Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir.

“Second, the factual allegations that are taken as true

Id.

Assertions

Ashcroft v. Iqbal, 556 U.S. 662, 678
Dismissal is

Balistreri v. Pacifica Police

Upon granting a motion to dismiss for failure to state a
claim, a court has discretion to allow leave to amend the
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complaint pursuant to Federal Rule of Civil Procedure 15(a).

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“Dismissal with prejudice and without leave to amend is not

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appropriate unless it is clear . . . that the complaint could not

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be saved by amendment.”

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Inc., 316 F.3d 1048, 1052 (9th Cir. 2003).

Eminence Capital, L.L.C. v. Aspeon,

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B.

Judicial Notice

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Defendants request judicial notice of (1) a Memorandum

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Agreement of Sale, (2) a Grant Deed, (3) a Deed of Trust, (4) a

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Substitution of Trustee, (5) a Notice of Default, (6) an

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Assignment of Deed of Trust, (7) a Notice of Trustee’s Sale, and

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(8) Trustee’s Deed Upon Sale.

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through 8 are appropriate for judicial notice because they are

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public records and are “not subject to reasonable dispute.”

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R. Evid. 201(b).

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request for judicial notice.

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C.

Ex. 1-8, RJN, Doc. #8.

Exhibits 1

Fed.

Accordingly, the Court GRANTS Defendants’

Discussion
1.

First Cause of Action for Breach of Contract

Defendants move to dismiss Plaintiff’s first cause of action

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for breach of contract because Plaintiff has not alleged a valid

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oral contract.

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misconstrued her first cause of action because it is not a cause

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of action for breach of an oral contract but a cause of action

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for breach of a written agreement.

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argue that even if there is a written contract, Plaintiff has

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failed to allege that Defendants breached it or that Plaintiff

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suffered any damages as a result.

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Plaintiff argues that Defendants have

In their reply, Defendants

For a breach of contract claim, Plaintiff must allege the
following elements: “(1) the contract; (2) plaintiff’s
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performance of the contract or excuse for nonperformance;

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(3) defendants’ breach; and (4) the resulting damage to

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plaintiff.”

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Lortz v. Connell, 273 Cal. App. 2d 286, 290 (1969).

Here, Plaintiff argues that the written contract is the

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April 2010 Modification Agreement.

Opp. at 3 (citing Compl.

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¶¶ 23-24).

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Servicing, LLC, 208 Cal.App.4th 1001 (2012), to argue that her

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breach of contract claim should not be dismissed.

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the plaintiff made monthly payments under the modification

Further, she relies on Barroso v. Ocwen Loan

In Barroso,

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agreement, and the lender acknowledged receipt of the payments,

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but her home was nonetheless sold in a foreclosure sale.

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Cal.App.4th at 1005-09.

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not make the payments pursuant to the Modification Agreement

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because she allegedly relied on the statements made by

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Defendants’ representatives assuring her that her home would not

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be foreclosed if she stopped making her payments.

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31.

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an anticipatory breach by Defendants because these statements

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give the inference “that Defendants will not perform pursuant to

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the parties contractual agreement.”

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208

Here, unlike in Barroso, Plaintiff did

Compl. ¶¶ 26-

She argues that when Defendants made these statements it was

Opp. at 5.

Under California law, “[a]nticipatory breach occurs when one

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of the parties to a bilateral contract repudiates the contract.

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The repudiation may be express or implied.

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repudiation is a clear, positive, unequivocal refusal to perform

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. . . an implied repudiation results from conduct where the

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promisor puts it out of his power to perform so as to make

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substantial performance of his promise impossible.”

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Johnston, 15 Cal. 3d 130, 137, 539 P.2d 425, 430 (1975)
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An express

Taylor v.

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(citations omitted).
Here, Plaintiff alleges that an anticipatory breach occurred

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on April 16, 2010, when a person representing Defendants called

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her and told her to stop making payments because any further

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payments would not be refunded.

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“a clear, positive, unequivocal refusal to perform.”

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Plaintiff alleged that Defendants did something to put

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performance out of their power.

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to sufficiently allege an anticipatory breach.

However, this allegation is not
Nor has

Therefore, Plaintiff has failed
Because Plaintiff

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has not alleged a breach by Defendants, the Court need not

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address Defendants’ other arguments.

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Accordingly, the Court dismisses Plaintiff’s breach of a

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written contract claim.

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amend because Plaintiff may be able to allege all the required

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elements of a breach of contract claim.

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2.

The Court grants Plaintiff leave to

Second Cause of Action for Breach of the Covenant
of Good Faith and Fair Dealing

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Defendants move to dismiss Plaintiff’s second cause of

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action for breach of the covenant of good faith and fair dealing,

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in part, because Plaintiff’s allegations are contradictory.

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at 5-6.

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claim and the case law cited by Defendants does not apply.

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Mot.

Plaintiff contends that Defendants mischaracterize her

Every contract “imposes upon each party a duty of good faith

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and fair dealing in its performance and its enforcement.”

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Fortaleza v. PNC Fin. Servs. Grp., Inc., 642 F. Supp. 2d 1012,

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1021-22 (N.D. Cal. 2009)(citing McClain v. Octagon Plaza, LLC,

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159 Cal.App.4th 784, 798 (2008)).

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implied covenant of good faith and fair dealing, a plaintiff must
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“To establish a breach of an

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establish the existence of a contractual obligation, along with

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conduct that frustrates the other party’s rights to benefit from

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the contract.”

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state a claim for breach of the implied covenant of good faith

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and fair dealing, a plaintiff must identify the specific

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contractual provision that was frustrated.”

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Fargo Bank, 873 F. Supp. 2d 1179, 1191 (N.D. Cal. 2012) (quoting

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Perez v. Wells Fargo Bank, N.A., No. 11–02279, 2011 WL 3809808,

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at *18 (N.D. Cal. Aug. 29, 2011).

Id. (citations omitted).

More importantly, “to

Plastino v. Wells

As Plaintiff argues, the cases

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cited by Defendants, Applied Equip. Corp. v. Litton Saudi Arabia

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Ltd., 7 Cal. 4th 503 (1994) and Bionghi v. Metro. Water Dist. of

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So. California, 70 Cal.App.4th 1358, 1370 (1999), do not apply

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because the court in Applied does not directly analyze a breach

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of the covenant of good faith and fair dealing claim and in

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Bionghi, the court held that there was no underlying contract.

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In the complaint, Plaintiff alleges that she fully performed

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under the terms of the Modification Agreement, which obligated

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Defendants to modify Plaintiff’s loan documents to a permanent,

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thirty-year loan with fixed terms but they allegedly refused.

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Compl. ¶¶ 40-41.

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complaint that she stopped making monthly payments under the

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Modification Agreement.

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allegations in the complaint that the Modification Agreement

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obligated Defendants to modify Plaintiff’s loan documents.

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Plaintiff alleges that Defendants promised that if she complied

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“with the terms of the Home Affordable Modification Trial Period

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Plan (‘Trial Period Plan’), Defendants [would] modify the terms

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of [her] home loan.”

This contradicts the allegation in her

Compl. ¶ 31.

Compl. ¶ 19.
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There are also no

However, that obligation was

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part of the Trial Period Plan not the Modification Agreement,

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which, according to Plaintiff, resulted from her compliance with

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the Trial Period Plan.

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contractual obligation as required to establish a breach of an

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implied covenant of good faith and fair dealing.

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208 Cal.App.4th at 1015 (holding that the plaintiff could amend

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her cause of action for breach of the implied covenant of good

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faith and fair dealing because under the terms of the

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Modification Agreement, the defendant was obligated to modify

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Therefore, Plaintiff has not alleged a

See Barroso,

plaintiff’s loan documents).
Accordingly, the Court dismisses Plaintiff’s second cause of

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action.

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action, the Court grants Plaintiff leave to amend.

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Because Plaintiff may be able to clarify this cause of

3.

Third Cause of Action for Wrongful Foreclosure

Defendants move to dismiss Plaintiff’s third cause of action

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for wrongful foreclosure because Plaintiff did not cure the

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default and did not tender.

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cause of action for wrongful foreclosure by alleging that the

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servicer performed a foreclosure sale when she had made all the

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payments due, citing Bank of America v. La Jolla Group II (2009)

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(2005) 129 Cal.App.4th 706, 712, in her complaint, and Barroso,

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208 Cal.App.4th at 1017, in her opposition.

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46-47.

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Plaintiff argues that she stated a

Opp. at 7; compl. ¶¶

For a wrongful foreclosure claim, a plaintiff must allege

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that “(1) Defendants caused an illegal, fraudulent, or willfully

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oppressive sale of the property pursuant to a power of sale in a

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mortgage or deed of trust; (2) Plaintiffs suffered prejudice or

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harm; and (3) Plaintiffs tendered the amount of the secured
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indebtedness or were excused from tendering.”

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Home Loan Mortgage Corp., 2:12-CV-00091-GEB, 2013 WL 1326425, at

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*7 (E.D. Cal. Mar. 29, 2013).

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aside a foreclosure sale, based on equitable principles.”

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Barroso, 208 Cal.App.4th at 1016.

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state a wrongful foreclosure claim without full tender, “[i]f,

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after a default, the trustor and beneficiary enter into an

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agreement to cure the default and reinstate the loan, no

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contractual basis remains for exercising the power of sale.”

Nugent v. Fed.

“A full tender must be made to set

A plaintiff may be able to

Id.

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(quoting La Jolla Grp. II, 129 Cal.App.4th at 712)).

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the court held that the plaintiff had made all payments due and

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therefore the foreclosure was wrongful and it was not necessary

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to tender.

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behalf of the homeowners tendered a payment on the loan and the

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bank accepted the payment; therefore, the court held that the

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homeowners and bank had entered into an agreement to cure the

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default and it followed that the bank could not sell the home.

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129 Cal.App.4th at 712.

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Id.

In Barroso,

Similarly, in La Jolla Group, someone acting on

In this case, Plaintiff alleges that “[p]ursuant to the

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Modification Agreement, all arrearages were capitalized and the

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default was cured.”

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earlier allegation that “[h]ad Plaintiff known that Defendants

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intended to foreclose upon her home and did not intend to agree

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to and perform pursuant to the Modification Agreement, Plaintiff

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would have cured the default on her home.”

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these contradictory allegations, it is unclear from the complaint

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whether the default was cured.

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determine whether full tender is required.

Compl. ¶ 46.

However, this contradicts her

Id. ¶ 32.

Because of

Therefore, the Court cannot

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Accordingly, the Court dismisses Plaintiff’s third cause of

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action.

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because she may able to clarify her allegations.

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The Court grants Plaintiff leave to amend this claim

4.

Fourth Cause of Action for Misrepresentation

Defendants move to dismiss Plaintiff’s fourth cause of

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action for misrepresentation because she has not alleged

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knowledge of falsity and intent to defraud with required

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specificity.

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names of the accused, the misrepresentations, dates, and how the

Plaintiff argues that she sufficiently alleged the

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misrepresentations were made.

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knowledge may be proven by circumstantial evidence.

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She also argues that intent and

For an intentional misrepresentation claim, a plaintiff must

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allege “(1) a misrepresentation; (2) knowledge of falsity;

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(3) intent to defraud or to induce reliance; (4) justifiable

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reliance; and (5) resulting damage.”

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USA, 5:11-CV-05245 EJD, 2012 WL 5868945, at *2 (N.D. Cal. Nov.

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19, 2012) (citing Engalla v. Permanente Med. Group, Inc., 15 Cal.

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4th 951, 974 (1997)).

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9(b), claims of fraud must be pleaded with particularity.

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R. Civ. Pro. 9; see also Neilson v. Union Bank of Cal., N.A., 290

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F. Supp. 2d 1101, 1141 (C.D. Cal. 2003) (“It is well established

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in the Ninth Circuit that both claims for fraud and negligent

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misrepresentation must meet Rule 9(b)’s particularity

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requirement.”)

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however, does not apply to allegations of knowledge or intent.

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Fed. R. Civ. Pro. 9(b) (“Malice, intent, knowledge, and other

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conditions of a person's mind may be alleged generally.”)

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However, “[p]laintiffs must still plead facts establishing

McReynolds v. HSBC Bank

Under Federal Rule of Civil Procedure
Fed.

The heightened pleading requirement of Rule 9(b),

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scienter with the plausibility required under Rule 8(a)” DeLeon

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v. Wells Fargo Bank, N.A., 10-CV-01390-LHK, 2011 WL 311376, at *8

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(N.D. Cal. Jan. 28, 2011) (citing Iqbal, 129 S.Ct. at 1954).

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Here, Plaintiff alleges that the Defendants’ representatives

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misrepresented that Plaintiff’s home was not in foreclosure

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proceedings.

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“Defendants knew that Plaintiff’s home was in foreclosure

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proceedings” and “Defendants made these misrepresentations with

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the intent to mislead Plaintiff for the purpose of obtaining

Compl. ¶ 49.

Plaintiff further alleges that

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title to Plaintiff’s home, thereby surreptitiously ‘stealing’

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Plaintiff’s home.”

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conclusory because Plaintiff provides no facts from which the

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Court can infer intent or knowledge.

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may prove intent and knowledge through circumstantial evidence,

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none of those facts are alleged in the complaint.

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Plaintiff’s allegations do not meet the pleading requirements.

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Accordingly, the Court dismisses Plaintiff’s fourth cause of

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action for misrepresentation.

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allege more facts, the Court grants leave to amend.

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5.

Id. ¶¶ 49-50.

However, these allegations are

Moreover, while Plaintiff

Therefore,

Because Plaintiff may be able to

Fifth Cause of Action for Unfair Business
Practices

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Defendants move to dismiss Plaintiff’s fifth cause of action

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for unfair business practices pursuant to Business and

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Professional Code Section 17200 (“Section 17200”) because

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Plaintiff does not seek an appropriate form of relief, Plaintiff

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has no standing, and there is no violation of a predicate

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statute.

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violations of predicate statues and law are alleged throughout

Plaintiff argues that she has suffered an injury and

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2

all causes of action.
Under Section 17200, unfair competition is defined as “any

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unlawful, unfair or fraudulent business act or practice” and

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“unfair, deceptive, untrue or misleading advertising.”

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Bus. & Prof. Code § 17200.

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an underlying state or federal statute or common law. See Cel–

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Tech Communications, Inc. v. Los Angeles Cellular Tel. Co., 20

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Cal. 4th 163, 180 (1999).

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“threatens an incipient violation of an antitrust law, or

See Cal.

An act is “unlawful” if it violates

An act is “unfair” if the act

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violates the policy or spirit of one of those laws because its

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effects are comparable to or the same as a violation of the law.”

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Id. at 187.

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are likely to be deceived.

14

Television, Inc. v. Gen’l Foods Corp., 35 Cal.3d 197, 211 (1983).

15

A practice is “fraudulent” if members of the public
See Committee on Children’s

Here, Plaintiff alleges that Defendants violated

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“[California] Civil Code sections 2923.55, 2923.6, 2923.7, 2924b,

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2934a, 2924.8, 2923.5.”

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Plaintiff has not stated a claim under any of these statutes.

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her opposition, Plaintiff argues that Defendants have violated

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these statutes but does not address all of Defendants’ arguments.

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Each statute is discussed in turn below.

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Compl. ¶ 60.

Defendants argue that
In

California Civil Code Sections 2923.55, 2923.6, and 2923.7

23

are all part of the Homeowner Bill of Rights (the “HBOR”), which

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became effective on January 1, 2013.

25

Bank, N.A., 2013 U.S. Dist. LEXIS 43063, at *10 (C.D. Cal. Mar.

26

26, 2013) (holding that that the HBOR provisions alleged by

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Plaintiff, including Sections 2923.55, 2923.6, 2923.7, became

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effective on January 1, 2013).

Guglielmelli v. Wells Fargo

Moreover, these provisions do not
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1

apply retroactively.

2

Plaintiff alleges occurred between December 2009 and September

3

2011, when the property was sold.

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Trustee’s Deed Upon Sale, Ex. 8, RJN.

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alleged any conduct by Defendants that occurred after January 1,

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2013, Plaintiff cannot state a claim under these sections.

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Accordingly, the Court dismisses Plaintiff’s claims for violation

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of Sections 2923.55, 2923.6, and 2923.7.

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Id.

In this case, all the conduct

Compl. ¶¶ 19-30; Notice of
Because Plaintiff has not

California Civil Code Section 2924b (“Section 2924b”)

10

“governs notices of default in nonjudicial foreclosure

11

proceedings.”

12

Trustee Services, Inc., 180 Cal.App.4th 1090, 1097 (2009)

13

(explaining the duties of a trustee under Section 2924b).

14

complaint contains no factual allegations regarding the trustee

15

or how Defendants violated Section 2924b and therefore, the claim

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is not properly alleged.

17

2924b is preempted by the Home Owners Loan Act (“HOLA”), 12

18

U.S.C. §§ 1461, et seq., citing Fowler v. Wells Fargo Bank, C 12-

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04869 DMR, 2012 WL 5503538, at *5 (N.D. Cal. Nov. 13, 2012).

20

However, Fowler relies on a case that holds that Section 2924,

21

not Section 2924b, is preempted.

22

CV 10-4082 NJV, 2011 WL 871749, at *4 (N.D. Cal. Mar. 14, 2011).

23

Nevertheless, because Plaintiff has failed to allege sufficient

24

facts, the claim for violation of Section 2924b is dismissed.

Banc of America Leasing & Capital, LLC v. 3 Arch

The

Defendants also argue that Section

See Wienke v. Indymac Bank FSB,

25

California Civil Code Section 2934a (“Section 2934a”)

26

governs the recording and notices of the substitution of a

27

trustee.

28

WL 1380322, at *4 (N.D. Cal. Apr. 20, 2012) (explaining the

Permito v. Wells Fargo Bank, N.A., C-12-00545 YGR, 2012

14

1

procedure for substitution of trustee under Section 2934a).

2

the complaint, Plaintiff has not alleged any facts to show that

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the substitution of trustee failed to meet the statutory

4

requirements.

5

documents, First American Title, the trustee under the Deed of

6

Trust, recorded a Substitution of Trustee in September 2010,

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which a trustee may do under Section 2934a.

8

Ex. 3 to RJN, at 2 (listing First American Title as trustee);

9

Substitution of Trustee, Ex. 4 to RJN, at 1 (stating that First

In

In addition, based on judicially noticeable

See Deed of Trust,

10

American Title filed a Substitution of Trustee).

11

Plaintiff’s claim for violation of Section 2934a is dismissed.

12

Therefore,

California Civil Code Section 2924.8 (“Section 2924.8”)

13

requires that a notice of a trustee’s sale be provided to the

14

homeowner twenty days prior to the sale.

15

§ 2924.8(d).

16

address for the mortgage note is different than the property

17

address.” Cal. Civ. Code § 2924.8(d).

18

need to allege that her billing address is different from her

19

property address, which she has not done.

20

has not alleged that she did not receive notice twenty days

21

before the sale.

22

this statute is dismissed.

23

Cal. Civ. Code

This section applies to loans “if the billing

As such, Plaintiff would

In addition, Plaintiff

Therefore, Plaintiff’s claim for violation of

California Civil Code Section 2923.5 (“Section 2923.5”)

24

governs the notice requirements for initiating nonjudicial

25

foreclosure.

26

compliance of Section 2923.5 have held that allegations of non-

27

compliance fail in the presence of a declaration of compliance

28

attached to a notice of default.

Defendant argues that that courts evaluating

15

However, the Court need not

1

address this issue because the claim is moot.

2

party raised this argument, the Court is obligated to raise the

3

mootness argument sua sponte because it is a jurisdictional

4

issue.

5

(9th Cir. 2005) (stating that because mootness is a

6

jurisdictional issue, federal courts are obliged to raise it sua

7

sponte).

8

postponement of the foreclosure sale before it occurs.

9

v. Vericrest Fin. & Summit Mgmt. Co. LLC, C 13-3450 SBA, 2013 WL

Although neither

Gator.com Corp. v. L.L. Bean, Inc., 398 F.3d 1125, 1129

Under Section 2923.5, the only remedy is the
Salcido

10

5946090, at *3 (N.D. Cal. Nov. 5, 2013).

11

already transpired, a cause of action arising under section

12

2923.5 is moot.”

13

Since the Property was sold September 2011 (Notice of Trustee’s

14

Deed Upon Sale, Ex. 8, RJN), Plaintiff has no recourse under

15

Section 2923.5.

16

moot.

17

Id.

“Where a sale has

Here, the sale has already transpired.

Therefore, the Court dismisses this claim as

Thus, Plaintiff has failed to allege a violation of Sections

18

2923.55, 2923.6, 2923.7, 2924b, 2934a, 2924.8, and 2923.5.

In

19

the absence of violation of a borrowed law, a UCL claim fails

20

under the unlawful prong of Section 17200.

21

extent Plaintiff relies on breach of contract, breach of good

22

faith and fair dealing, or misrepresentation to serve the basis

23

for the UCL claim (Opp. at 13), the UCL claim fails for the

24

reasons mentioned above.

25

Plaintiff’s UCL claim.

26

Plaintiff’s UCL claim predicated on violation of Sections 2924b,

27

2934a, and 2924.8 because Plaintiff may be able to allege more

28

facts and clarify the claims.

In addition, to the

Accordingly, the Court dismisses
The Court grants leave to amend

However, the Court denies leave to
16

1

amend Plaintiff’s UCL claim to the extent it is predicated on

2

violation of Sections 2823.55, 2923.6, 2923.7, and 2923.5 because

3

amendment would be futile.

4

Plaintiff’s UCL claim, the Court need not address Defendants’

5

remedy and standing arguments.

6

6.

Because the Court dismisses

Sixth Cause of Action for Breach of Civil Code
Sections 2923 and 2924

7
8
9

Defendants move to dismiss Plaintiff’s sixth cause of action
for breach of Sections 2923 and 2924 because the sections do not

10

apply retroactively and Plaintiff has failed to allege sufficient

11

facts.

12

preclude an award of damages.

13

Plaintiff argues that Defendants’ argument does not
Opp. at 14.

Specifically, Plaintiff alleges that Defendants violated

14

California Civil Code Sections 2923.5, 2923.55, 2923.6, 2923.7,

15

2924, 2924.17, 2924.18.

16

Section 2923.5 is moot because the foreclosure sale has already

17

occurred as mentioned above.

18

Sections 2923.55, 2923.6, and 2923.7, fail because they are part

19

of the HBOR, which took effect on January 1, 2013 and does not

20

apply retroactively, as mentioned above.

21

2924.17 and 2924.18 are part of the HBOR.

22

Living Trust v. Wells Fargo Bank, N.A., 13-CV-00542-JST, 2013 WL

23

1196959, at *4 (N.D. Cal. Mar. 25, 2013) (holding that plaintiffs

24

sections 2924.17 and 2914.18 failed because the statute did not

25

apply retroactively); Sabherwal v. Bank of New York Mellon,

26

11CV2874 WQH-BGS, 2013 WL 4833940, at *10 (S.D. Cal. Sept. 10,

27

2013) (same).

28

Defendants that occurred after January 1, 2013, Plaintiff’s

Plaintiff’s claim for violation of

Plaintiff’s claim for violation of

Similarly, Sections
Michael J. Weber

Because Plaintiff has not alleged any conduct by

17

1
2

claims fail.
Plaintiff argues that Defendants’ argument that the HBOR is

3

not retroactive does not preclude an award of damages because the

4

HBOR states that if the foreclosure has not yet occurred, then an

5

injunction is proper relief but if the foreclosure has occurred,

6

then money damages are proper.

7

provides no authority for this argument, and more importantly,

8

fails to acknowledge that HBOR does not apply retroactively.

9

Because the HBOR does not apply, it does not matter whether the

10
11

Opp. at 14.

Plaintiff however

foreclosure sale has occurred.
Finally, Plaintiff alleges that “Defendants failed to file a

12

Civil Code section 2924 declaration” (Comp. ¶ 65), Defendants

13

“filed a false 2924 declaration” (id.), and “The notice of

14

default filed by Defendants did not contain the required

15

declaration per Code section 2924” (id. ¶ 68).

16

allegations, as Defendants argue, are contradictory.

17

Furthermore, Section 2924 does not require a declaration.

18

declaration requirement is found in Section 2923.5, which

19

provides that “a notice of default filed pursuant to Section 2924

20

shall include a declaration that the mortgagee, beneficiary, or

21

authorized agent has contacted the borrower, [or] has tried with

22

due diligence to contact the borrower as required by this

23

section . . . .”

24

mentioned above, claims pursuant to Section 2923.5 are moot.

25

Cal. Civ. Code § 2923.5(b).

These

The

However, as

Accordingly, the Court dismisses Plaintiff’s sixth cause of

26

action for breach of Sections 2923 and 2924 because the claim

27

does not apply retroactively or is moot.

28

granted because the claim cannot be saved by amendment.
18

No leave to amend is

1

///
7.

2

Seventh Cause of Action for Dual Tracking in
Violation of Civil Code Sections 2923 and 2924

3
Defendants move to dismiss Plaintiff’s seventh cause of
4
action for dual tracking in violation of Civil Code Sections 2923
5
and 2924 2 because the statutes do not apply retroactively.
6
Plaintiff argues that the seventh cause of action is proper but
7
provides no grounds.

Opp. at 14.

8
Section 2914.18 prohibits the practice of “dual-tracking,”
9
or proceeding with foreclosure while considering a lender’s
10
eligibility for loan modifications.

Cal. Civ. Code § 2924.18.

11
However, Section 2914.18 became effective on January 1, 2013, and
12
does not apply retroactively.

Because Plaintiff has failed to

13
allege actions that she was dual tracked after January 1, 2013,
14
her dual tracking claim fails.

Further, Plaintiff cannot allege

15
any facts because the house was sold in 2011.
16
Accordingly, the Court dismisses Plaintiff’s seventh cause
17
of action.

The Court does not grant Plaintiff leave to amend

18
because Plaintiff cannot allege facts to show dual tracking.
19
20
III.

ORDER

21
For the reasons set forth above, the Court GRANTS WITH
22
PREJUDICE Defendants’ Motion to Dismiss:
23
(1)

Plaintiff’s fifth cause of action for unfair business

24
25
26
27
28

2

In the complaint, the header for the seventh cause of action
provides, “Dual Tracking in Violation of Civil Code sections 2953
and 2954” however the body of complaint states “Defendants’
violations under Civil Code sections 2923 and 2924 et. seq.”
(Compl. ¶ 75). Accordingly, the Court finds that the header
mistakenly lists the Sections 2953 and 2954 and the correct
sections are Sections 2923 and 2924.
19

1

practices predicated on violation of Sections 2823.55, 2923.6,

2

2923.7, and 2923.5;

3
4
5

(2)

Plaintiff’s sixth cause of action for breach of

Sections 2923 and 2924; and
(3)

Plaintiff’s seventh cause of action for dual tracking

6

in violation of Civil Code Sections 2923 and 2924.

7

The Court DISMISSES WITH LEAVE TO AMEND:

8

(1)

9
10
11
12
13
14
15
16

Plaintiff’s first cause of action for breach of

contract;
(2)

Plaintiff’s second cause of action for breach of the

covenant of good faith and fair dealing;
(3)

Plaintiff’s third cause of action for wrongful

foreclosure;
(4)

Plaintiff’s fourth cause of action for

misrepresentation; and
(5)

Plaintiff’s fifth cause of action for unfair business

17

practices predicated on violation of Sections 2924b, 2934a, and

18

2924.8.

19

Plaintiff must file her Amended Complaint within twenty (20)

20

days from the date of this Order. Defendants shall file their

21

responsive pleading within twenty (20) days thereafter.

22

Plaintiff elects not to file an Amended Complaint, she should

23

file a notice of dismissal within the next twenty (20) days.

24
25

IT IS SO ORDERED.
Dated:

January 28, 2014

26
27
28
20

If