17-CIV-05657 MELE M. UPERESA VS. WORLD SAVINGS BANK, ET AL.

MELE M. UPERESA WORLD SAVINGS BANK
JONATHAN MATTHEWS

HEARING ON DEMURRER TENTATIVE RULING:

The Demurrer of Defendants Mortgage Electronic Registration Systems, Inc. (“MERS”), Bank of New York Mellon (“BONYM”) and Bayview Loan Servicing LLC (“Bayview”) (also collectively “Defendants”) to First Amended Complaint (“FAC”) of Plaintiff Mele M. Uperesa (“Plaintiff”) is ruled on as follows:

(1) Demurrer to the Second Cause of Action to Quiet Title is SUSTAINED WITHOUT LEAVE TO AMEND. The Court previously granted without leave to amend Defendant Breckenridge Property Fund 2016, LLC’s (“Breckenridge”) Motion for Judgment on the Pleadings, holding that Plaintiff acknowledged that Breckenridge’s only role is that of a bona fide purchaser for value (“BFP”) at the Trustee’s Sale. (See Defendants’ Request for Judicial Notice, Exh. K.) Plaintiff did not challenge Breckenridge’s status as a BFP, and a BFP who acquires an interest in real property without notice of another’s asserted rights in the property takes the property free of such unknown rights. (Id., citing Melendrez v. D&I Inv., Inc. (2005) 127 Cal.App.4th 1238, 1251.) Thus, Plaintiff failed to state a quiet title claim against Breckenridge and Breckenridge now holds title to the property as a BFP. Accordingly, Plaintiff fails to state facts sufficient to support a quiet title claim against Defendants.

(2) Demurrer to the Third Cause of Action for Cancellation of Instruments is SUSTAINED WITH LEAVE TO AMEND based on failure to allege facts sufficient to support this claim.

This claim is alleged against MERS and BONYM. Plaintiff seeks to cancel written instruments that purport to be Assignment of the Note and Deed of Trust executed by Defendants. (FAC ¶ 45.) Plaintiff alleges that such instruments are void because they were issued by World Savings Bank after Plaintiff’s note was sold or assigned without notice to Plaintiff by parties who were not owners of Plaintiff’s note. Plaintiff’s allegations however, are contradicted by the deed of trust. The deed of trust lists MERS as the beneficiary. (See (See Defendants’ Request for Judicial Notice, Exh. A, p.2.) The deed of trust includes that “Borrower understands and agrees that MERS holds only legal title to the interests granted by Borrower in this Security Instrument, but if necessary to comply with law of customer, MERS…has the right: to exercise any or all of those interests, including, but not limited to, the right to foreclose and sell the Property; and to take any action required of Lender including, but not limited to, releasing and canceling this Security Instrument.” (See Defendants’ Request for Judicial Notice, Exh. A, p.3.) MERS assigned the deed of trust to BONYM as trustee for Defendant Cwalt Inc. Alternative Loan Trust. (See Defendants’ Request for Judicial Notice, Exh. B.) Thus, Plaintiff’s allegation that the Assignments by MERS and BONYM are void because they had no authority, is contradicted by the express language in the deed of trust.

Plaintiff also raises for the first time in opposition, allegations of robosigning as a basis for cancellation of these documents. Such allegations are not included in the FAC. Therefore, Plaintiff is given leave to amend to allege such facts, if possible, to support this claim.

(3) Demurrer to the Fourth Cause of Action for Violation of Homeowner Bill of Rights (“HOBR”) is SUSTAINED WITH LEAVE TO AMEND for Plaintiff to allege facts sufficient to support this claim. This claim is alleged against Bayview. Plaintiff claims that Quality Loan and Bayview engaged in illegal dual tracking because Plaintiff’s loan modification was still under review when the property was foreclosed. (See FAC ¶¶ 18, 19, 24, 54, 55.) Civil Code section 2924.11(a) provides that if a borrower submits a complete application for a foreclosure prevention alternative that is offered through the borrower’s mortgage servicer, then a notice of sale shall not be recorded while the application is pending and until the borrower has been provided with a written determination by the mortgage servicer. Plaintiff’s allegations fall short of alleging such facts, including that Plaintiff submitted a complete application.

(4) Demurrer to the Fifth Cause of Action for Violation of Business and Professions Code Section 17200 is SUSTAINED WITH LEAVE TO AMEND. Plaintiff fails to allege facts to support an unfair, unlawful or fraudulent business act or practice by Defendants. This claim is based on the same allegations against Defendants in the other causes of action, and therefore fails for the reasons set forth above.

(5) Demurrer to the First Cause of Action for Declaratory Relief is SUSTAINED WITH LEAVE TO AMEND based on failure to allege facts sufficient to support an actual controversy exists between Plaintiff and Defendants. Plaintiff claims that an actual controversy exists over Bayview’s illegal dual tracking, and MERS and BONYM’s robosigning. However, as explained above Plaintiff’s allegations are insufficient to support that Bayview engaged in illegal dual tracking. Moreover, the FAC does not contain any allegations regarding robosigning.

(6) Defendants’ Request for Judicial Notice is GRANTED.

(7) Plaintiff is to file and serve a Second Amended Complaint within 20 days of the date of the Order.

If the tentative ruling is uncontested, it shall become the order of the Court, pursuant to CRC Rule 3.1308(a)(1), adopted by Local Rule 3.10. If the tentative ruling is uncontested, DEMURRING PARTY is directed to prepare, circulate, and submit a written order reflecting this Court’s ruling verbatim for the Court’s signature, consistent with the requirements of CRC Rule 3.1312. The proposed order is to be submitted directly to Judge Susan L. Greenberg, Department 3.