Case Name: Gina M. Gray, et al. v. La Salle Bank, N.A., et al.
Case No.: 1-14-CV-263333
Demurrer by Defendants Yu Pan and Ling Jin to the First Amended Complaint of Plaintiffs Gina M. Gray and David A. Zamora
Demurrer to the First Amended Complaint
Defendants argue in the reply brief that Plaintiffs lack standing to challenge the validity of the trustee’s sale based on the securitization theory. However, the court declines to address this argument as it was raised for the first time in the reply papers. (See Browne v. County of Tehama (2013) 213 Cal.App.4th 704, 720, fn. 10 [points raised for the first time in a reply brief will ordinarily not be considered, because such consideration would deprive the respondent of an opportunity to counter the argument].)
With respect to the seventh cause of action [quiet title], Defendants argue that the claim is barred by the doctrine of res judicata.
“Res judicata describes the preclusive effect of a final judgment on the merits. It prevents relitigation of the same cause of action in a second suit between the same parties or parties in privity with them. Under the doctrine of res judicata, all claims based on the same cause of action must be decided in a single suit; if not brought initially, they may not be raised at a later date. Res judicata precludes piecemeal litigation by splitting a single cause of action or relitigation of the same cause of action on a different legal theory for different relief.” (Federal Home Loan Bank of San Francisco v. Countrywide Financial Corp. (2013) 214 Cal.App.4th 1520, 1527 [internal citations and quotation marks omitted].)
“Res judicata bars a cause of action that was or could have been litigated in a prior proceeding if (1) the present action is on the same cause of action as the prior proceeding; (2) the prior proceeding resulted in a final judgment on the merits; and (3) the parties in the present action or parties in privity with them were parties to the prior proceeding. (Federal Home Loan Bank of San Francisco v. Countrywide Financial Corp., supra, 214 Cal.App.4th at p. 1527 [internal citation and quotation marks omitted].) Defendants have the burden of establishing each element of res judicata. (Ibid.)
Here, Defendants argue that the quiet title claim fails because the court has already determined that Defendants acquired lawful title to the subject property at the trustee’s sale. ( See Defendants’ Request for Judicial Notice at Exhibit 2; see also Vella v. Hudgins (1977) 20 Cal.3d 251, 256 [courts have held that subsequent fraud or quiet title suits founded upon the allegations of irregularity in a trustee’s sale are barred by the prior unlawful detainer judgment].) However, as the opposition points out, res judicata is not applicable since the unlawful detainer judgment is currently on appeal and under submission with the appellate division. For purposes of res judicata, the pendency of an appeal precludes finality of a judgment under California law. (See Nathanson v. Hecker (2002) 99 Cal.App.4th 1158, 1163, fn. 1.) Thus, the court finds that the doctrine of res judicata does not apply on demurrer.
Alternatively, Defendants argue that the quiet title cause of action fails because it is based on the prior fraud claims which are not alleged with specificity against Defendants. (See Moss Estate Co. v. Adler (1953) 41 Cal.2d 581, 584 [the general rules that fraud must be specifically pleaded applies particularly to quiet title actions].) Plaintiffs appear to concede this argument as it is not addressed in their opposition papers. However, as this is the first demurrer, Plaintiffs will be given leave to amend their quiet title claim. (See City of Stockton v. Sup. Ct. (2007) 42 Cal.4th 730, 747 [if the plaintiff has not had an opportunity to amend the complaint in response to the demurrer, leave to amend is liberally allowed as a matter of fairness, unless the complaint shows on its face that it is incapable of amendment].)
Therefore, Defendants’ demurrer to the seventh cause of action is SUSTAINED WITH 10 DAYS’ LEAVE TO AMEND for failure to state a claim.
With respect to the eighth cause of action [cancellation of instruments], Defendants raise the same fraud argument discussed above. Thus, Defendants’ demurrer to the eighth cause of action is also SUSTAINED WITH 10 DAYS’ LEAVE TO AMEND for failure to state a claim.
Finally, even though the title page of the FAC identifies a claim for declaratory relief, no such cause of action appears in the body of the pleading. Therefore, Defendants’ demurrer to the ninth cause of action for declaratory relief is moot.
Procedural Violation
Defendants have filed moving papers in excess of 15 pages in violation of California Rules of Court, rule 3.1113(d), which requires that an opening memorandum may not exceed 15 pages. There is nothing in the court file to indicate that Defendants obtained or sought an order pursuant to California Rules of Court, rule 3.1113(e), allowing filing of a longer memorandum. Because there appears to be minimal prejudice to Plaintiffs, the court addresses the merits of the motion. Even though Defendants are self-represented litigants, any future filings must comply with all applicable statutes and rules, and the court may decline to consider future non-compliant papers. (See Leslie v. Board of Medical Quality Assurance (1991) 234 Cal.App.3d 117, 121 [self-represented parties are held to the same restrictive procedural rules as an attorney].)
Request for Judicial Notice
Defendants’ request for judicial notice is GRANTED IN PART and DENIED IN PART. The request is denied with respect to the trustee’s deed upon sale (Exhibit 1) because it was not attached to the request and filed with the court pursuant to California Rules of Court, rule 3.1306(c). With respect to the unlawful detainer judgment (Exhibit 2), the court notes that it was not attached to the request for judicial notice in compliance with the court rules. However, since the judgment constitutes a record of the superior court, the court may take judicial notice of its own files. (See Stepan v. Garcia (1974) 43 Cal.App.3d 497, 500 [the court may take judicial notice of its own file].) Thus, the request for judicial notice with respect to Exhibit 2 is granted.
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