Patino v. Recontrust Company, N.A. et al

Filing 66

ORDER GRANTING PLAINTIFFS 6 MOTION TO REMAND. Signed by Judge Claudia Wilken on 2/6/2012. (ndr, COURT STAFF) (Filed on 2/6/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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PENNY L. PATINO, as trustee of PENNY
L. PATINO’S LIVING TRUST,

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United States District Court
For the Northern District of California

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ORDER GRANTING
PLAINTIFF’S
MOTION TO REMAND
(Docket No. 6)

Plaintiff,

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No. C 11-00345 CW

v.
RECONTRUST COMPANY, N.A.; MORTGAGE
ELECTRONIC REGISTRATION SYSTEMS,
INC.; BANK OF AMERICA; BANK OF
AMERICA HOME LOANS; BAC HOME LOAN
SERVICING, L.P.; COUNTRYWIDE HOME
LOANS, INC.; THE BANK OF NEW YORK
MELLON, formerly known as THE BANK OF
NEW YORK as trustee for CERTIFICATE
HOLDERS CWALT, INC. 2006 OA 11
MORTGAGE PASS-THROUGH CERTIFICATES,

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Defendants.
/

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Plaintiff Penny L. Patino, as trustee of Penny L. Patino’s

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Living Trust, brings claims against Defendants ReconTrust Company,

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N.A., et al., arising from the foreclosure of real property.

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Plaintiff moves to remand her action to Contra Costa Superior

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Court.

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submission on the papers.

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without prejudice to being reset if mediation were to prove

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unsuccessful.

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that mediation has been unsuccessful.

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considered the papers submitted by the parties, the Court GRANTS

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Plaintiff’s motion to remand.

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the Court declines to reset for hearing Plaintiff’s and Defendants’

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other motions.

Defendants oppose the motion.

The motion was taken under

The Court denied Plaintiff’s motion

Docket No. 63.

Defendants have advised the Court
Docket No. 65.

Having

Because the case will be remanded,

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BACKGROUND
Plaintiff, a California resident, filed her complaint in

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Contra Costa Superior Court, asserting claims related to the

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foreclosure of property located at 8 Hermosa Court in Danville,

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California.

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including ReconTrust, which is allegedly a California citizen.

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On January 7, 2011, ReconTrust filed a Declaration of

Her claims are brought against various Defendants,

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Nonmonetary Status in state court.

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objected to ReconTrust’s filing.

On January 19, 2011, Plaintiff

In her objection, Plaintiff

United States District Court
For the Northern District of California

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contended that ReconTrust did not satisfy the requirements of

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California Civil Code sections 2923.5 or 2924 before it filed a

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notice of default.1

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Plaintiff brings claims for (1) wrongful foreclosure based on

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a violation of Civil Code sections 2923.5 and 2924; (2) quiet

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title; (3) slander of title; (4) declaratory relief; and

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(5) intentional infliction of emotional distress.

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intends to seek a declaration that, among other things, Defendants

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did not comply with Civil Code section 2923.5.

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Plaintiff

Defendants ReconTrust, N.A.; Bank of America; BAC Home Loans

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Servicing, L.P.; Countrywide Home Loans, Inc.; and The Bank of New

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York Mellon, formerly known as The Bank of New York, as Trustee for

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In her complaint, Plaintiff refers to a declaration
regarding due diligence that Defendants never presented to her.
See, e.g., Compl. at 10-11. Along with her motion to be referred
to the Court’s Alternative Dispute Resolution (ADR) program,
Plaintiff included a letter she sent to Defendants’ counsel, to
which was attached a “California Declaration” by Sheila Stephens,
“Mortgage Servicing Specialist II of BAC Home Loan Servicing, LP.”
See Docket No. 29, at 3. None of the boxes on the declaration,
apparently related to the due diligence requirement of Civil Code
section 2923.5(g), were checked.
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Certificate Holders Cwalt, Inc. 2006 OA 11 Mortgage Pass-Through

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Certificates removed Plaintiff’s action on January 24, 2011

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pursuant to the Court’s diversity jurisdiction.

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28 U.S.C. § 1332.

LEGAL STANDARD
A defendant may remove a civil action filed in state court to

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federal district court so long as the district court could have

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exercised original jurisdiction over the matter.

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§ 1441(a).

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before judgment, it appears that the district court lacks subject

28 U.S.C.

Title 28 U.S.C. § 1447(c) provides that if, at any time

United States District Court
For the Northern District of California

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matter jurisdiction over a case previously removed from state

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court, the case must be remanded.

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of the removal statute must be strictly construed.

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Inc., 980 F.2d 564, 566 (9th Cir. 1992).

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against removal jurisdiction means that the defendant always has

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the burden of establishing that removal is proper.”

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should resolve doubts as to removability in favor of remanding the

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case to state court.

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On a motion to remand, the scope
Gaus v. Miles,

“The ‘strong presumption’

Id.

Courts

Id.
DISCUSSION

Plaintiff argues that, because she and ReconTrust are citizens

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of California, the Court lacks diversity jurisdiction over her

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action.

Defendants do not dispute that ReconTrust is a California

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citizen.

Instead, they argue that ReconTrust’s citizenship should

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be disregarded because it is a nominal party based on its

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declaration of non-monetary status filed in state court.

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assert that remand is improper because Plaintiff fraudulently

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joined ReconTrust to this action.

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availing.

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They also

Neither of these arguments is

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Under California law, a trustee under a deed of trust that

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“maintains a reasonable belief that it has been named in the action

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or proceeding solely in its capacity as trustee, and not arising

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out of any wrongful acts or omissions on its part in the

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performance of its duties as trustee, . . . may file a declaration

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of nonmonetary status.”

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does not object timely to a trustee’s filing of such a declaration,

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“the trustee shall not be required to participate any further in

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the action or proceeding.”

Cal. Civ. Code § 2924l(a).

Id. § 2924l(d).

If a plaintiff

However, in “the event

United States District Court
For the Northern District of California

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of a timely objection to the declaration of nonmonetary status, the

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trustee shall thereafter be required to participate in the action

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or proceeding.”

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that Plaintiff did not file a timely objection in state court.

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Plaintiff provides evidence, and a review of the state court docket

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shows, that she objected timely to ReconTrust’s declaration.

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ReconTrust’s declaration does not make it a nominal party or excuse

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it from participating in this case.

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Id. § 2924l(e).

Defendants incorrectly assert

Thus,

Furthermore, Defendants fail to establish that ReconTrust is

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fraudulently joined.

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Defendants “must demonstrate that there is no possibility” that

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Plaintiff will be able to establish a cause of action in state

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court against ReconTrust.

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1629937, at *1 (N.D. Cal.).

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finding fraudulent joinder, and Defendants carry “a heavy burden of

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persuasion.”

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1005, 1008 (N.D. Cal. 2001).

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facts suggesting that ReconTrust did not satisfy its obligations as

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To make a showing of fraudulent joinder,

Lantz v. DaimlerChrysler Corp., 2005 WL
There is a general presumption against

Plute v. Roadway Package Sys., Inc., 1141 F. Supp. 2d
Plaintiff has alleged sufficient

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trustee under Civil Code section 2923.5 and 2924.

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reference to the tender rule is inapplicable here; there is no

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evidence that the Hermosa Court property has been sold at a

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trustee’s sale.

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4163525, at *4 (E.D. Cal.) (discussing requirement of plaintiff to

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allege tender of indebtedness “to state a cause of action to set

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aside a foreclosure”).

Defendants’

See, e.g., Delgado v. Bank of Am. Corp., 2009 WL

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Because ReconTrust is not a nominal party excused from

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participating in this action and because it was not fraudulently

United States District Court
For the Northern District of California

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joined, its California citizenship precludes the Court from

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exercising diversity jurisdiction.

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matter jurisdiction is lacking, Plaintiff’s action will be remanded

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to state court.

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Accordingly, because subject

CONCLUSION
For the foregoing reasons, the Court GRANTS Plaintiff’s motion

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to remand (Docket No. 6).

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Contra Costa Superior Court and close the file.

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The Clerk shall remand this action to

IT IS SO ORDERED.

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Dated:

2/6/2012
CLAUDIA WILKEN
United States District Judge

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