No real surprises. One case below (Sato) displayed something that may becoming a trend—it contains a long soliloquy about law in a discrete area without making any holding! In this instance it was HOLA preemption discussion. I can’t remember which other case recently did same or what area of law, but it appears to be judicial cover without understanding??? When you read you find yourself asking, “Okay, you’ve just said that it could be x or it could be y but you refuse to state which one it is” and then it’s just left hanging there like some determination was made.
In Gomes v. Countrywide Home Loans, Inc., the California Court of Appeal discussed a borrower’s right to bring a court action to determine whether the owner of a note has authorized its nominee to initiate the foreclosure process. Id. The Court of Appeal stated that the plaintiff was “attempting to interject the courts into this comprehensive judicial scheme … [and] has identified no legal authority for such a lawsuit.” Id. The court held that “[n]othing in the statutory provisions establishing the nonjudicial foreclosure process suggests that a judicial proceeding is permitted or contemplated.” Id. Accordingly, the Court of Appeal concluded that California Civil Code section 2924(a)(1) does not permit a borrower “to bring a lawsuit to determine a nominee’s authorization to proceed with foreclosure on behalf of the noteholder” because it would “fundamentally undermine the nonjudicial nature of the process and introduce the possibility of lawsuits filed solely for the purpose of delaying foreclosures.” Id. at 1155, 121 Cal.Rptr.3d 819.
*4 Even if Plaintiff’s cause of action were not barred by the tender rule, Plaintiff lacks standing in this case to challenge the foreclosure process. The Court agrees with Defendants that Plaintiff is attempting to impose a judicial review of the nonjudicial foreclosure process that is not contemplated by California law. Therefore, because under California law Plaintiff has no legal authority to bring a suit to determine whether the owner of the Note has authorized its nominee to initiate the foreclosure process, Plaintiff’s claim fails as a matter of law. Accordingly, the Court grants Defendants’ motion to dismiss Plaintiff’s first cause of action for Defendants’ lack of standing with leave to amend. (See Doc. No. 1, 3.)
Under California law, a plaintiff lacks standing to challenge a contract if he is not a party to the contract or if the principal contract “was not made expressly for the benefit of plaintiff.” Luis v. Orcutt Town Water Co., 204 Cal.App.2d 433, 439, 22 Cal.Rptr. 389 (Ct.App.1962); see also Bascos v. Fed. Home Loan Mortgage Corp., No. CV 11–3968–JFW (JCx), 2011 WL 3157063, at *4 (C.D.Cal. July 22, 2011) (“To the extent Plaintiff challenges the securitization of his loan because Freddie Mac failed to comply with the terms of its securitization agreement, Plaintiff has no standing to challenge the validity of the securitization of the loan as he is not an investor of the loan trust.”).
Baum v. Am.’s Servicing Co., 12-CV-00310-H BLM, 2012 WL 1154479 (S.D. Cal. Apr. 5, 2012)
California courts have held that plaintiffs cannot state a cause of action based on the alleged lack of authority of MERS to initiate foreclosure proceedings. See Robinson v. Countrywide Home Loans, Inc., 199 Cal.App.4th 42, 45–47, 130 Cal.Rptr.3d 811 (2011); Fontenot v. Wells Fargo Bank, N.A., 198 Cal.App.4th 256, 269–73, 129 Cal.Rptr.3d 467 (2011); Gomes v. Countrywide Home Loans, Inc., 192 Cal.App.4th 1149, 1155, 121 Cal.Rptr.3d 819 (2011). In Robinson, Fontenot, and Gomes, the plaintiffs alleged that violations of California’s non-judicial foreclosure process invalidated the foreclosures. In all three cases, the California Courts of Appeal sustained the dismissal of the plaintiffs’ complaints, explaining that “nowhere does the statute provide for a judicial action to determine whether the person initiating the foreclosure process is indeed authorized,” Gomes, 192 Cal.App.4th at 1155, 121 Cal.Rptr.3d 819, and “that the statutory scheme … does not provide for a preemptive suit challenging standing.” Robinson, 199 Cal.App.4th at 46, 130 Cal.Rptr.3d 811. Further, in Gomes the court noted that the loan agreement signed by plaintiff expressly granted MERS the authority to foreclose. 192 Cal.App.4th at 1155, 121 Cal.Rptr.3d 819 (“by entering into the deed of trust, Gomes agreed that MERS had the authority to initiate a foreclosure”).
FN #4: Plaintiff alleges that the First Assignment of Trust is a product of “possible forgery,” Opp’n at 18, supported by allegations that the MERS officer who signed the document, which was notarized in Texas, lives in Michigan and is also listed as an employee of NdeX. FAC ¶ 15. However, as the Ninth Circuit has explained, “MERS relies on its members to have someone on their own staff become a MERS officer with the authority to sign documents on behalf of MERS.” Cervantes v. Countrywide Home Loans, Inc., 656 F.3d 1034, 1040 (2011); see also Steers v. CitiMortgage, Inc., No. CV–11–1144–PHX–GMS, 2011 WL 6258219, at *3 (D.Ariz. Dec.15, 2011) (holding implausible allegations of forgery based on fact that signatory was officer of MERS and Citimortgage because “Plaintiff’s allegation, however, rests on the faulty assumption that Martinez could not be an officer of both CitiMortgage and MERS.”). Without more specific facts suggesting that the notarized document was in fact forged, the Court finds that plaintiff’s allegations insufficient.
Boyter v. Wells Fargo Bank, N.A., C 11-03943 SI, 2012 WL 1144281 (N.D. Cal. Apr. 4, 2012)
[A]ny notice or communication that [is] issued in the course of performing duties related to [a] non-judicial foreclosure sale” is a privileged communication under Cal. Civ.Code § 47, and is therefore “not actionable.” Richards, 2010 WL 3222151, at *4 (citing Cal. Civ.Code § 2924(d)).
However, the transfer of deed is a notice filed pursuant to the foreclosure action. See, e.g., Richards, 2010 WL 3222151, at *4. As such, the Court finds that it is a privileged communication under Cal. Civ.Code §§ 47 and 2924(d). See id. Thus, Plaintiff fails to state a claim for slander of title.
Lykkeberg v. Bank of Am., N.A., C 12-00772 JW, 2012 WL 1099773 (N.D. Cal. Apr. 2, 2012)
In any event, foreclosure activity does not constitute “debt collection.” Diessner v. Mortg. Elec. Registration Sys., Inc., 618 F.Supp.2d 1184, 1189 (D.Ariz.2009); see also, e.g., Garcia v. American Home Mortg. Serv., Inc., No. 11–CV–03678–LHK, 2011 U.S. Dist. LEXIS 142039, at *13–17, 2011 WL 6141047 (N.D.Cal. Dec.9, 2011) (“non-judicial foreclosure does not constitute ‘debt collection’ as defined by the [FDCPA]”); Garfinkle v. JPMorgan Chase Bank, No. C 11–01636 CW, 2011 U.S. Dist. LEXIS 81054, at *7–10, 2011 WL 3157157 (N.D.Cal. July 26, 2011); Geist v. OneWest Bank, No. C 10–1879 SI, 2010 U.S. Dist. LEXIS 113985, at *5–8, 2010 WL 4117504 (N.D.Cal. Oct.19, 2010); Aniel v. T.D. Serv. Co., No. C 10–03185 JSW, 2010 U.S. Dist. LEXIS 92018, at *2–4, 2010 WL 3154087 (N.D.Cal. Aug.9, 2010); Landayan v. Washington Mut. Bank, No. C–09–00916 RMW, 2009 U.S. Dist. LEXIS 93308, at *6–7, 2009 WL 3047238 (N.D.Cal. Sept.18, 2009).
Sato v. Wachovia Mortg., FSB, 5:11-CV-00810 EJD, 2012 WL 1110054 (N.D. Cal. Mar. 31, 2012)