Filed 12/27/19 Finsand v. Nationstar Mortgage CA6

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SIXTH APPELLATE DISTRICT

JEFFREY E. FINSAND et al.,

Plaintiffs and Appellants,

v.

NATIONSTAR MORTGAGE, LLC et al.,

Defendants and Respondents.

H045052

(Santa Cruz County

Super. Ct. No. CV182195)

I. INTRODUCTION

Appellants Jeffrey E. Finsand and Richard Craig French brought an action against respondents Nationstar Mortgage and U.S. Bank, N.A., as trustee for the holder of CSMC 2007-07 trust (collectively, Nationstar) arising from Nationstar’s foreclosure on residential property that Finsand and French owned together. Finsand had defaulted on a promissory note in the amount of $593,000 that was secured by a deed of trust on the property. Nationstar, the servicer for the loan, had declined Finsand’s applications for loan modification on the grounds that his applications were incomplete or untimely.

Nationstar filed a motion for summary judgment, or, in the alternative, summary adjudication, on the grounds that as a matter of law neither Finsand nor French were eligible for relief under the statutory loan modification remedies provided by the California Homeowners Bill of Rights (HBOR; Civ. Code, § 2920.5 et seq.) The trial court granted the motion and entered a judgment of dismissal on June 6, 2017. For the reasons stated below, we conclude that the trial court did not err in granting the motion for summary judgment, and we will affirm the judgment of dismissal.

II. FACTUAL BACKGROUND

Our factual summary is drawn from the parties’ separate statements of fact and the evidence they submitted in connection with the motion for summary judgment.

In 2005, Finsand executed a promissory note in the amount of $593,000 that was secured by a deed of trust on residential property located on Lighthouse Avenue in Santa Cruz (hereafter, the Lighthouse property). The deed of trust stated that ownership of the Lighthouse property was divided between Finsand and French, with Finsand having a 30 percent interest and French having a 70 percent interest. French occupied the Lighthouse property as his residence, while Finsand lived at another property on Fresno Drive in Santa Cruz.

After Nationstar became the servicer for the loan in 2013, Finsand telephoned Nationstar in the first of several attempts to obtain a loan modification. For his part, French never contacted Nationstar to discuss a loan modification and never had direct communication with Nationstar.

Finsand telephoned Nationstar again in December 2013 regarding the status of foreclosure because he was in active Chapter 13 bankruptcy. Nationstar informed him that no foreclosure was pending. In March 2014 Finsand submitted an incomplete request for modification assistance (RMA) package to Nationstar.

After further contact with Nationstar regarding his request for modification, Finsand submitted a completed RMA package to Nationstar on March 27, 2014. Finsand’s statements in the RMA package included, among others, the following: (1) the Lighthouse property on which the loan was secured was his primary residence (although it is undisputed that he did not reside there); (2) he was the sole borrower on the account (as reflected in the promissory note); (3) he did not know if he had filed for bankruptcy (although he had previously informed Nationstar that he was in active Chapter 13 bankruptcy); (4) he was not requesting mortgage assistance for a property that was not his principal residence; and (5) he received $2800 per month in rental income (but it was not for rental of the Lighthouse property).

These statements were made by Finsand under penalty of perjury with the following acknowledgement: “ ‘I understand that if I have intentionally defaulted on my existing mortgage, engaged in fraud or if it is determined that any of my statements or any information contained in the documentation that I provide are materially false and that I was ineligible for assistance under MHA,[ ] the Servicer, the U.S. Department of the Treasury, or their respective agents may terminate my participation in MHA, including any right to future benefits and incentives that would have been available under the program, and also may seek other remedies available at law an [sic] in equity . . . .’ ”

Nationstar later contacted Finsand regarding documents that were missing from his RMA package. On July 15, 2014, Nationstar sent Finsand a letter denying his request for loan modification under HAMP Tier I and II, and also denying “standard proprietary modification,” on the grounds that the RMA was incomplete since he had not supplied the missing documents.

In September 2014, Finsand applied again to Nationstar for loan modification. Nationstar accepted Finsand’s second RMA package and began a modification review. During that process, Nationstar noted that Finsand’s primary residence appeared to be an address other than the Lighthouse property on which the deed of trust had been recorded to secure the loan that was the subject of Finsand’s loan modification request. Nationstar therefore required Finsand to provide a letter of explanation and a “ ‘luxury bill,’ ” which is a non-utility bill, such as a credit card statement, showing that he resided at the Lighthouse property.

In October 2014 Nationstar declined Finsand’s second application for a loan modification. Nationstar advised Finsand in a letter dated December 24, 2014, that he was 1697 days behind in his mortgage payments and his arrears totaled $204,024.18. On December 29, 2014 Nationstar recorded a notice of default on the Lighthouse Avenue property.

In early 2015 Finsand applied for a third time to Nationstar for a loan modification. In April 2015 Nationstar declined loan modification under HAMP Tiers I and II, as well as “standard proprietary modification,” because Finsand had not provided the documents requested by Nationstar.

On June 15, 2015, Finsand again telephoned Nationstar to discuss a possible loan modification. Nationstar informed Finsand that a trustee’s sale of the Lighthouse property was set for July 6, 2015. Nationstar also informed Finsand that in order for the loan modification process to continue, he would need to provide the missing documents, including “tax forms, updated RMA, Dodd-Frank forms, rental receipts.”

According to Finsand, he faxed a complete RMA with all required documents to Nationstar on July 5, 2015, the day before the trustee’s sale. According to Nationstar, it received an incomplete package of documents from Finsand on July 7, 2015, the day after the trustee’s sale was held. The Lighthouse property was sold by the trustee to a former co-defendant, Eagle Vista Properties, Inc., and the property has since been sold to a third party. The trustee sent French and Finsand a check for the surplus amount of the sale, less the balance remaining on Finsand’s loan, in the amount of $93,189.74. French did not cash the check and does not know its whereabouts.

III. PROCEDURAL BACKGROUND

A. The Pleading

The operative pleading is the second amended complaint (complaint), which named as defendants Nationstar and U.S. Bank, among other defendants not involved in this appeal, and asserted ten causes of action. Eight causes of action are at issue in this appeal, including the first cause of action for negligence; the fourth cause of action for promissory estoppel; the fifth cause of action for intentional misrepresentation; the sixth cause of action for negligence misrepresentation; the seventh cause of action for violation of Business and Professions Code, section 17200; the eighth cause of action for violation of section 2923.6, subdivisions (c) and (d); and the ninth cause of action for intentional infliction of emotional distress.

B. The Motion for Summary Judgment

In its motion for summary judgment or, in the alternative, summary adjudication, Nationstar asserted that plaintiffs’ claims were all based on the allegation that Nationstar had violated the provisions of the California Homeowners’ Bill of Rights (HBOR) governing loan modification, as set forth in former section 2923.6 and asserted in the eighth cause of action. Since it was undisputed that Finsand did not occupy the Lighthouse property as his principal residence, and French was not a borrower, Nationstar argued that neither plaintiff was entitled to protection under HBOR, which required the borrower seeking loan modification to occupy the property secured by the loan as his or her principal residence.

Regarding the first cause of action for negligence, Nationstar contended that it had no duty to plaintiffs because French was not a borrower and it had no legal duty to offer a loan modification to Finsand. Additionally, because Finsand had misrepresented that he occupied the Lighthouse property as his principal residence, and had failed to provide the requested documents with his RMA, Nationstar argued that Finsand could not establish that Nationstar was liable for breach of duty and damages.

Similarly, Nationstar argued that plaintiffs could not establish the elements of the fourth cause of action for promissory estoppel, the fifth cause of action for intentional misrepresentation, and the sixth cause of action for negligent misrepresentation, for the same reasons: (1) there is no evidence that Nationstar made a clear and unambiguous promise of loan modification; (2) in any event, plaintiffs could not justifiably rely on a promise of loan modification since it is undisputed that Finsand’s applications for loan modifications contained misrepresentations and were incomplete; and (3) Finsand could not establish that Nationstar caused any damages because it was Finsand’s incomplete and misleading applications that caused the damages (loss of his ownership interest in the Lighthouse property and other monetary losses alleged in the complaint).

As to the seventh cause of action for violation of Business and Professions Code section 17200, Nationstar argued that there was no evidence that its conduct in relation to Finsand’s applications for a loan modification were fraudulent, unfair, or unlawful.

Finally, as to the ninth cause of action for intentional infliction of emotional distress, Nationstar contended there was no evidence to support plaintiffs’ claim that Nationstar intended to keep them lingering in default status, and no evidence of any extreme or outrageous conduct by Nationstar.

In opposition to the motion for summary judgment, plaintiffs argued that there were triable issues of fact as to every cause of action and therefore the motion could not be granted. In particular, plaintiffs contended that there were triable issues of fact regarding whether Finsand had submitted a RMA package that was complete when Nationstar committed unlawful dual tracking by foreclosing on the Lighthouse property while Finsand’s application for a loan modification was pending. Plaintiffs also argued that the HBOR’s protections applied to borrowers who, like Finsand, did not occupy the property as their principal residence, since the “unless otherwise provided” language in section 2923.6, subdivision (a), meant that other types of borrowers were eligible for loan modification under the federal program, HAMP.

C. The Trial Court’s Order

The trial court granted Nationstar’s motion for summary in its order of May 11, 2017, ruling that all causes of action lacked merit as a matter of law. The court determined that the cause of action for violation of former section 2923.6 lacked merit because it was undisputed that Finsand was not an owner/occupier of the Lighthouse property and French was not a borrower, and therefore neither plaintiff was eligible for relief under former section 2923.6.

Having made that determination, the trial court also ruled that the cause of action for negligence lacked merit as a matter of law since Nationstar, as a lender, did not owe a duty to a borrower who is ineligible for relief under section 2923.6. The cause of action for violation of Business and Professions Code section 17200 similarly lacked merit as a matter of law, the court ruled, because that cause of action was derivative of the cause of action under section 2923.6, and there was no liability under section 2923.6.

The trial court further ruled that the causes of action for promissory estoppel and intentional and negligent misrepresentation lacked merit as a matter of law since (1) no representations were made by Nationstar to French; and (2) Finsand could not reasonably rely on any representations by Nationstar regarding loan modification, since he knew he would be disqualified from loan modification due to his misstatements that he was the owner/occupier of the Lighthouse property.

Finally, as to the cause of action for intentional infliction of emotional distress, the trial court ruled that plaintiffs had failed to present any evidence of “egregious intentional conduct” by Nationstar that led directly to the foreclosure of the Lighthouse property.

A judgment of dismissal in favor of Nationstar was entered on June 6, 2017.

IV. DISCUSSION

In analyzing whether the trial court properly granted summary judgment, we first set forth the standard of review, followed by a brief overview of HBOR and section 2923.6. We then consider plaintiffs’ contentions regarding each cause of action at issue on appeal.

A. The Standard of Review
B.
The standard of review for an order granting a motion for summary judgment is de novo. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 860 (Aguilar).) In performing our independent review, we apply the same three-step process as the trial court. “Because summary judgment is defined by the material allegations in the pleadings, we first look to the pleadings to identify the elements of the causes of action for which relief is sought.” (Baptist v. Robinson (2006) 143 Cal.App.4th 151, 159 (Baptist).)

“We then examine the moving party’s motion, including the evidence offered in support of the motion.” (Baptist, supra, 143 Cal.App.4th at p. 159.) A defendant moving for summary judgment has the initial burden of showing that a cause of action lacks merit because an element of the cause of action cannot be established or there is a complete defense to that cause of action. (Code of Civ. Proc., § 437c, subds. (o) & (p)(2); Aguilar, supra, 25 Cal.4th at p. 850.)

If the moving papers make a prima facie showing that justifies a judgment in the defendant’s favor, the burden shifts to the plaintiff to make a prima facie showing of the existence of a triable issue of material fact. (Code of Civ. Proc., § 437c, subd. (p)(2); Aguilar, supra, 25 Cal.4th at p. 849.)

In determining whether the parties have met their respective burdens, “the court must ‘consider all of the evidence’ and ‘all’ of the ‘inferences’ reasonably drawn therefrom [citation], and must view such evidence [citations] and such inferences [citations], in the light most favorable to the opposing party.” (Aguilar, supra, 25 Cal.4th at p. 843.) “There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.” (Id. at p. 850, fn. omitted.) “Thus, a party ‘cannot avoid summary judgment by asserting facts based on mere speculation and conjecture, but instead must produce admissible evidence raising a triable issue of fact. [Citation.]’ [Citation.]” (Dollinger DeAnza Associates v. Chicago Title Insurance Co. (2011) 199 Cal.App.4th 1132, 1144-1145.)

B. The Homeowner Bill of Rights—Former Section 2923.6

“The Homeowner Bill of Rights [HBOR] ([§§] 2920.5, 2923.4– 7, 2924, 2924.9– 12, 2924.15, 2924.17– 20) . . . , effective January 1, 2013,[ ] was enacted ‘to ensure that, as part of the nonjudicial foreclosure process, borrowers are considered for, and have a meaningful opportunity to obtain, available loss mitigation options, if any, offered by or through the borrower’s mortgage servicer, such as loan modifications or other alternatives to foreclosure.’ (§ 2923.4.)” (Valbuena v. Ocwen Loan Servicing, LLC (2015) 237 Cal.App.4th 1267, 1272 (Valbuena).) Section 2923.4, subdivision (a) also provides in part: “Nothing in the act that added this section, however, shall be interpreted to require a particular result of that process.”

Among other things, “HBOR prohibits ‘dual tracking,’ which occurs when a bank forecloses on a loan while negotiating with the borrower to avoid foreclosure. (§ 2923.6.)” (Valbuena, supra, 237 Cal.App.4th at p. 1272.) Regarding dual tracking, the version of section 2923.6 in effect at all times relevant to this appeal provided in part: “If a borrower submits a complete application for a first lien loan modification offered by, or through, the borrower’s mortgage servicer, a mortgage servicer, mortgagee, trustee, beneficiary, or authorized agent shall not record a notice of default or notice of sale, or conduct a trustee’s sale, while the complete first lien loan modification application is pending.” (Former § 2923.6, subd. (c).)

The definition of “complete” was provided by former section 2923.6, subdivision (h) which stated: “(h) For purposes of this section, an application shall be deemed ‘complete’ when a borrower has supplied the mortgage servicer with all documents required by the mortgage servicer within the reasonable timeframes specified by the mortgage servicer.”

HBOR also specified the type of borrower to whom the act applied: “Unless otherwise provided, paragraph (5) of subdivision (a) of Section 2924, and Sections 2923.5, 2923.55, 2923.6, 2923.7, 2924.9, 2924.10, 2924.11, and 2924.18 shall apply only to first lien mortgages or deeds of trust that are secured by owner-occupied residential real property containing no more than four dwelling units. For these purposes, ‘owner-occupied’ means that the property is the principal residence of the borrower and is security for a loan made for personal, family, or household purposes.” (§ 2924.15, italics added.)

In the present case, it is undisputed that French was not a borrower and Finsand misstated on his applications to Nationstar for a loan modification that the Lighthouse property was his principal residence, when he actually resided at another address. Although French argues that he was a borrower for purposes of HBOR since his name was on the deed of trust securing the Lighthouse property, the authority he relies on does not support that proposition. (See Rakestraw v. Rodrigues (1972) 8 Cal.3d 67, 74 [“ratification of an act of forgery by one held out to be a principal creates an agency relationship between such person and the purported agent]; Stegeman v. Vandeventer (1943) 57 Cal.App.2d 753, 759 [“a husband or a wife may act as agent for the other”].)

Accordingly, neither French nor Finsand qualified as borrowers under section 2924.15 who were eligible for the loan modification remedies provided by HBOR at section 2923.6. Although plaintiffs contend that they nevertheless qualified as borrowers, the legislative history shows that the Legislature indicated its intent to limit application of HBOR as follows: “Limit scope of application [of HBOR] to only mortgages or deeds of trust that are secured by owner-occupied residential real property containing no more than four dwelling units. ‘Owner-occupied’ means that the property is the principal residence of the borrower and is security for a loan made for personal, family, or household purposes.” (Senate Rules Com., Off. of Sen. Floor Analyses, Conference Report No. 1, SB 900 (2011-2012 Reg. Sess.) as amended 6/27/12.)

Further, plaintiffs have provided no authority for the proposition that the phrase “unless otherwise provided” in section 2924.15, subd. (c) means there are exceptions to HBOR’s definition of borrower that would allow Finsand to qualify for loan modification remedies although he is not an owner-occupier of the Lighthouse property. Plaintiffs point to another HBOR provision, section 2920.5, which states: “Unless otherwise provided and for purposes of sections 2923.4, 2923.5, 2923.55, 2923.6, 2923.7, 2924.9, 2924.10, 2924.11, 2924.18, and 2924.19, ‘borrower’ means any natural person who is a mortgagor or trustor and who is potentially eligible for any federal, state, or proprietary foreclosure prevention alternative program offered by, or through, his or her mortgage servicer.” As we have discussed, HBOR expressly provides at section 2924.15 that a borrower for purposes of HBOR additionally must occupy as his or her principal residence the property that secures the loan the borrower seeks to modify.

We are also not convinced by plaintiffs’ argument that the federal Home Affordable Mortgage Program [HAMP] for loan modification applied to “non-owner occupied rental properties.” “ ‘The goal of HAMP is to provide relief to borrowers who have defaulted on their mortgage payments or who are likely to default by reducing mortgage payments to sustainable levels, without discharging any of the underlying debt.’ [Citation.]” (West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 785 (West).) HAMP had an occupancy requirement for borrowers: “ ‘[T]he borrower had to meet certain threshold requirements, including that the loan originated on or before January 1, 2009; [and] it was secured by the borrower’s primary residence; . . . .’ ” (Id. at p. 787; see also Rufini v. CitiMortgage, Inc. (2014) 227 Cal.App.4th 299, 306-307 [“The HAMP guideline . . . Supplemental Directive 09-01, specifies only that the home must be the borrower’s primary residence”]; Majd v. Bank of America, N.A. (2016) 243 Cal.App.4th 1293, 1301 (Majd) [same].)

For these reasons, we also determine that the trial court did not err in granting summary adjudication of the eighth cause of action for violation of former section 2923.6.

C. Negligence

Plaintiffs contend that a triable issues of fact exist as to the first cause of action for negligence, including whether Nationstar breached its duty by holding the foreclosure sale while Finsand’s application for loan modification was pending, failing to review Finsand’s applications in a timely manner, issuing a notice of default on the Lighthouse property while Finsand’s loan modification application was under consideration, mishandling Finsand’s applications by relying on incorrect information, and making material misrepresentations about the status of his applications for a loan modification.

“ ‘To state a cause of action for negligence, a plaintiff must allege (1) the defendant owed the plaintiff a duty of care, (2) the defendant breached that duty, and (3) the breach proximately caused the plaintiff’s damages or injuries.’ [Citation.]” (Daniels v. Select Portfolio Servicing, Inc. (2016) 246 Cal.App.4th 1150, 1180 (Daniels).)

In Daniels, this court noted that “ ‘as a general rule, a financial institution owes no duty of care to a borrower when the institution’s involvement in the loan transaction does not exceed the scope of its conventional role as a mere lender of money.’ [Citations.] (Daniels, supra, 246 Cal.App.4th at p. 1180.) However, this court ruled that in the context of loan modification, the factors set forth in Biakanja v. Irving (1958) 49 Cal.2d 647 (Biakanja) for determining the existence of a duty should apply. (Daniels, supra, 246 Cal.App4th at p. 1182-1183.)

As applied in the loan modification context, this court stated that the Biajanka factors are (1) “the extent to which the transaction–the loan modification–was intended to affect appellants,” (2) whether “the potential harm to appellants from mishandling the loan application process was readily foreseeable” (3) “the degree of certainty that appellants suffered injury,” (4) “the closeness of the connection between [the lender’s] conduct and appellants’ alleged injuries,” (5) whether the lender’s conduct is morally blameworthy because it placed the borrower in a position creating a need for a loan modification, and (6) “ ‘the policy of preventing future harm.’ ” (Daniels, supra, 246 Cal.App.4th at pp. 1182-1183.)

However, we need not determine in this case whether Nationstar owed a duty to plaintiffs and whether Nationstar breached that duty. Even assuming that Nationstar breached a duty in the loan modification process for the Lighthouse property, there is no issue of material fact as to the third element of a cause of action for negligence: “ ‘the breach proximately caused the plaintiff’s damages or injuries.’ [Citation.]” (See Daniels, supra, 246 Cal.App.4th at p. 1180.)

It is undisputed that Finsand misstated on his loan applications to Nationstar that he occupied the Lighthouse property as his principal residence, and that French was not a borrower with respect to the Lighthouse property. As we have discussed, for these reasons neither Finsand nor French qualified as a borrower for purposes of either HAMP or HBOR, and they were never eligible for the loan modification remedies, such as the prohibition on dual tracking, provided by section 2923.6. Therefore, based on the undisputed facts, the damages alleged by plaintiffs, included the loss of their ownership interests in the Lighthouse property through nonjudicial foreclosure, were the result of Finsand’s default on the mortgage payments, and not a breach of duty by Nationstar. We therefore determine that the trial court did not err in granting summary adjudication of the first cause of action for negligence.

D. Promissory Estoppel

Plaintiffs contend that triable questions of fact preclude summary adjudication of the fourth cause of action for promissory estoppel. They assert that Nationstar made “clear and unambiguous promises . . . that Plaintiffs’ would be evaluated for a HAMP modification and placed in a TPP if he met the NPV test.”

“[U]nder the doctrine of promissory estoppel, ‘[a] promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise.” (Kajima/Ray Wilson v. Los Angeles County Metropolitan Transportation Authority (2000) 23 Cal.4th 305, 310.) “ ‘The elements of a promissory estoppel claim are “(1) a promise clear and unambiguous in its terms; (2) reliance by the party to whom the promise is made; (3) [the] reliance must be both reasonable and foreseeable; and (4) the party asserting the estoppel must be injured by his reliance.” [Citation.] [Citation.]” (Jones v. Wachovia Bank (2014) 230 Cal.App.4th 935, 945.)

“ ‘ “Promissory estoppel applies whenever a ‘promise which the promissor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance’ would result in an ‘injustice’ if the promise were not enforced . . . .” ’ [Citation.] [¶] ‘[A] party plaintiff’s misguided belief or guileless action in relying on a statement on which no reasonable person would rely is not justifiable reliance . . . . A mere ‘hopeful expectation[ ] cannot be equated with the necessary justifiable reliance.’ ” (Aceves v. U.S. Bank, N.A.(2011) 192 Cal.App.4th 218, 227.)

Here, it is undisputed that French had no contact with Nationstar and no promises were made to him. As to Finsand, the undisputed facts show that he could not justifiably rely on a promise by Nationstar that he “would be evaluated for a HAMP modification and placed in a TPP if he met the NPV test,” since, as we have discussed, he was not eligible for loan modification under HAMP since he did not occupy the Lighthouse property as his primary residence. (See West, supra, 214 Cal.App.4th at p. 787.) Accordingly, the fourth cause of action for promissory estoppel cannot be established as a matter of law and the trial court did not err in granting summary adjudication.

E. Negligent and Intentional Misrepresentation

On appeal, plaintiffs contend that triable issues of fact exist regarding the misrepresentations made by Nationstar during the loan modification application process, including promises that “if Plaintiffs’ applied for a modification and met the NPV or internal lender modification test he would be entered into a Trial Plan Payment period (TPP) and thereafter received a permanent loan modification under HAMP,” “that if plaintiff submitted a modification application he would not be foreclosed on,” and “no foreclosure sale will be conducted and you will not lose your home during the HAMP evaluation.”

The elements of a cause of action for intentional misrepresentation are “(1) a misrepresentation, (2) knowledge of falsity, (3) intent to induce reliance, (4) actual and justifiable reliance, and (5) resulting damage. [Citations.]” (Chapman v. Skype Inc. (2013) 220 Cal.App.4th 217, 230-231.) The elements of a cause of action for negligent misrepresentation are the same, “except that it does not require knowledge of falsity but instead requires a misrepresentation of fact by a person who has no reasonable grounds for believing it to be true. [Citations.]” (Id. at p. 231.)

Based on the undisputed facts, we reiterate that as a matter of law neither French nor Finsand were eligible for loan modification under HAMP since French was not a borrower and Finsand did not reside in the Lighthouse property as his principal residence. Therefore, neither French nor Finsand could justifiably rely on any promise by Nationstar that they would receive a loan modification under HAMP or be eligible for any remedies under HAMP. (See West, supra, 214 Cal.App.4th at p. 787.) We therefore determine that plaintiffs cannot establish the justifiable reliance element of the causes of action for intentional and negligent misrepresentation, and the trial court did not err in granting summary adjudication.

F. Business and Professions Code section 17200

We understand plaintiffs to argue on appeal that triable issues of fact exist as to whether Nationstar committed unfair competition in violation of Business and Professions Code 17200 by dual tracking (holding a foreclosure sale while Finsand’s application for a loan modification was pending) and by denying a loan modification on the false grounds that Finsand failed to provide a complete RMA.

Business and Professions Code section 17200 “prohibits unfair competition, including unlawful, unfair, and fraudulent business acts. The UCL [unfair competition law] covers a wide range of conduct. It embraces ‘ “ ‘ “anything that can properly be called a business practice and that at the same time is forbidden by law.” ’ ” [Citations.]’ [Citation.] . . . [¶] [Business and Professions Codes]ection 17200 ‘borrows’ violations from other laws by making them independently actionable as unfair competitive practices. [Citation.]” (Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1143 (Korea Supply).)

We determine that plaintiffs cannot establish a cause of action because they were not eligible for the loan modification remedies provided by HBOR and HAMP since it was undisputed that French was not a borrower and the Lighthouse property was not Finsand’s primary residence. In other words, as a matter of law plaintiffs cannot establish a cause of action for unfair competition under Business and Professions Code by borrowing statutory violations from HBOR and HAMP. (See Korea Supply, supra, 29 Cal.4th at p. 1143.)

Plaintiffs’ reliance on Majd, supra, 243 Cal.App.4th 1293 for a contrary conclusion is misplaced. The decision in Majd is distinguishable, since in that case the plaintiff was a homeowner eligible to apply for loan modification under HAMP. (Id. at p. 1296.) Accordingly, we determine that the trial court did not err in granting summary adjudication of the cause of action for violation of Business and Professions Code section 17200.

G. Intentional Infliction of Emotional Distress

Plaintiffs argue that a triable issue of fact exists regarding their allegation the foreclosure of the Lighthouse property took place in violation of a promise not to foreclose. Nationstar responds that plaintiffs failed “to present any evidence to establish the type of egregious intentional conduct that would permit recovery under a cause of action for intentional infliction of emotional distress.” We agree.

The elements of the tort of intentional infliction of emotional distress are (1) extreme and outrageous conduct by the defendant; (2) extreme or severe emotional distress to the plaintiff; and (3) actual and proximate causation between the two. (Potter v. Firestone Tire & Rubber Co.(1993) 6 Cal.4th 965, 1001.) To be outrageous, the defendant’s conduct must be either intentional or reckless, and it must be so extreme as to exceed all bounds of decency in a civilized community. (Ibid.)

In this case, it is undisputed that Finsand was in default on the loan secured by the Lighthouse property and that Nationstar declined his applications for a loan modification and subsequently foreclosed on the property. As we have discussed, Finsand was not eligible for loan modification remedies under either HBOR or HAMP, and there was no evidence that Nationstar caused Finsand to be in default. In short, no evidence was presented in connection with the motion for summary judgment to show that Nationstar’s conduct was outrageous and exceeded all bounds of decency. Accordingly, the ninth cause of action for intentional infliction for emotional distress cannot be established and the trial court did not err in granting summary adjudication.

V. DISPOSITION

The judgment of dismissal entered on June 6, 2017 is affirmed.

_________________________________

ELIA, ACTING P.J.

WE CONCUR:

_______________________________

BAMATTRE-MANOUKIAN, J.

_______________________________

MIHARA, J.

Finsand et al. v. Nationstar Mortgage

H045052