Case Number: BC529341 Hearing Date: June 03, 2014 Dept: 58

JUDGE ROLF M. TREU
DEPARTMENT 58
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Hearing Date: Tuesday, June 3, 2014
Calendar No: 8
Case Name: Valdelamar v. U.S. Bank N.A., et al.
Case No.: BC529341
Motion: Demurrer
Moving Party: Defendants U.S. Bank, N.A.; Ocwen Loan Servicing, LLC; and Mortgage Electronic Registration Systems, Inc.
Responding Party: Plaintiff Felix Valdelamar
Notice: Untimely and Improperly Served Opposition

Tentative Ruling: Demurrer is sustained as to the 2nd COA without leave to amend; and is otherwise sustained with 15 days leave to amend.
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Background –
On 12/3/13, Plaintiff Felix Valdelamar filed this action against Defendants U.S. Bank, N.A.; Ocwen Loan Servicing, LLC; Quality Loan Service Corporation, and Mortgage Electronic Registration Systems, Inc. (“MERS”) arising out of the non-judicial foreclosure of real property. Plaintiff asserts causes of action for (1) violation of the Homeowners’ Bill of Rights (“HBOR”), (2) breach of written contract, (3) wrongful foreclosure, (4) negligence, and (5) unfair business practices.

Factual Allegations of the Complaint –
Plaintiff acquired title to property located at 15344 Bixler Ave., Paramount, CA 90723 subject to a deed of trust which secured a loan. ¶ 17. In 2012, Plaintiff fell behind in his payments to Ocwen. ¶ 18. On 7/25/13, Ocwen recorded a notice of default. ¶ 19. Despite having submitted a “LMA” which was in the process of review, Ocwen continued with foreclosure. ¶ 20. Plaintiff did not receive a written denial of his loan modification or an explanation of ineligibility. ¶ 25.

Demurrer –
U.S. Bank, Ocwen, and MERS (“Moving Parties”) demur to the Complaint.

1. Request for Judicial Notice
In connection with the demurrer, Moving Parties request judicial notice of the recorded deed of trust, corrective assignment of deed of trust, notice of default, notice of trustee’s sale, and various grant deeds. The RJN is granted.

2. Opposition
Plaintiff’s opposition was filed and served by mail on 5/21/14. It was due to be filed by 5/20/14 pursuant to CCP § 1005(b). Additionally, the service does not comply with CCP § 1005(c). Therefore, the opposition is both untimely and improperly served. Because Moving Parties’ failed to file a reply, the Court would normally find resulting prejudice and refuse to consider Plaintiff’s opposition. However, because this is the first challenge to the pleadings, the Court will consider Plaintiff’s opposition. Nevertheless, Plaintiff is admonished to comply with law and motion requirements, and the Court may decline to consider noncompliant papers in the future.

3. HBOR
Plaintiff’s 1st COA asserts various violations of HBOR: failure to provide a written determination on a loan modification application pursuant to Civil Code § 2923.6(c) (Complaint ¶ 30); failure to provide a single point of contact pursuant to Civil Code § 2923.7 (Complaint ¶ 31); and failure to contact Plaintiff to explore options to avoid foreclosure pursuant to Civil Code § 2923.55 (Complaint ¶ 32).

Moving Parties argue that Plaintiff fails to allege that he submitted a complete loan modification application (see Civil Code § 2923.6(c), 2924.18(a)), failed to request a single point of contact (Civil Code § 2923.7(a)), and alleges that Plaintiff spoke with Ocwen individuals (Complaint ¶ 27) and submitted a “LMA” which is presumably a loan modification application (Complaint ¶ 20). Plaintiff does not dispute these arguments and only asserts that he can amend. Opp’n p. 3:17-18. Therefore, the demurrer is sustained as to the 1st COA.

The Court notes that to the extent Plaintiff alleges discrete violations of HBOR, they should be alleged in separate COAs.

4. Breach of Contract
Plaintiff’s 2nd COA is based on Ocwen breaching a Servicer Participation Agreement in which Ocwen agreed to comply with the Home Affordable Modification Program. See Complaint ¶¶ 35-39. Moving Parties correctly note that this improperly seeks a private right or private cause of action under HAMP. See, e.g., Bank of America, N.A. v. Roberts (2013) 217 Cal.App.4th 1386, 1389; Pfeifer v. Countrywide Home Loans, Inc. (2012) 211 Cal.App.4th 1250, 1282 n.17 (concluding that homeowners have no right to enforce HAMP loan modification provisions); Castillo v. Bank of America, N.A. (S.D. Cal. 2012) 2012 WL 4793240 *6.

In opposition, Plaintiff relies on Marques v. Wells Fargo Home Mortg., Inc. (S.D. Cal. 2010) 2010 WL 3212131 *4-6, which stated that eligible HAMP borrowers had standing as third party beneficiaries under such an agreement. However, Marques has been recognized as a clear minority opinion and as dicta. See Graybill v. Wells Fargo Bank, N.A. (N.D. Cal. 2013) 2013 WL 978245 *12 n.4.

The demurrer is sustained as to the 2nd COA without leave to amend.

5. Wrongful Foreclosure
Plaintiff’s 3rd COA is based on the authority to foreclose (Complaint ¶¶ 44-45) and otherwise is based on the same arguments as raised in the 1st COA (id. ¶¶ 46-47). Moving Parties correctly note that Plaintiff fails to allege a specific factual basis that the foreclosure was initiated by an incorrect party. Jenkins v. JP Morgan Chase Bank, N.A. (2013) 216 Cal.App.4th 497, 512-13. Plaintiff alleges that Ocwen failed to record a limited power of attorney (Complaint ¶ 45); however, Plaintiff fails to cite to any authority stating this requirement as applicable to Plaintiff’s action.

Additionally, Moving Parties correctly note that Plaintiff fails to allege tender to challenge the foreclosure process. See Abdallah v. United Savings Bank (1996) 43 Cal.App.4th 1101, 1109. In opposition, Plaintiff asserted that tender is not required based on exceptions to the tender rule (see, e.g., Lona v. Citibank, N.A. (2011) 202 Cal.App.4th 89, 112-13): however, no facts are alleged to support this.

Therefore, the demurrer is sustained as to the 3rd COA.

6. Negligence
Moving Parties argue that they owe no duty to Plaintiff as a lender/servicer (see Perlas v. GMAC Mortg., LLC (2010) 187 Cal.App.4th 429, 436; Nymark v. Heart Fed. Sav. & Loan Ass’n (1991) 231 Cal.App.3d 1089, 1098) or in connection with consideration for a loan modification (see Ragland v. U.S. Bank Nat’l Ass’n (2012) 209 Cal.App.4th 182, 207). In opposition, Plaintiff asserts that factors giving rise to a duty (Biakanja v. Irving (1958) 29 Cal.2d 647, 650) are present: however, no facts are alleged to support these factors. The demurrer is sustained as to the 4th COA.

7. Unfair Business Practices
Plaintiff’s unfair business practices claim is dependent on the other COAs and is deficient for the same reasons as stated above. The demurrer is sustained as to the 5th COA.

8. Leave to Amend
Plaintiff has requested leave to amend. With the exception of the 2nd COA, the Court will grant leave to amend because this is the first challenge to the pleadings.