Filed 10/10/13 Wolford v. American Home Mortgate Servicing CA2/2
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication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
SECOND APPELLATE DISTRICT
DIVISION TWO
BARBARA WOLFORD, B237985
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC423446)
v.
AMERICAN HOME MORTGAGE
SERVICING, INC., et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of Los Angeles County. Alan S.
Rosenfield, Judge. Affirmed.
Law Offices of Jina A. Nam & Associates and Jina A. Nam for Plaintiff and
Appellant.
Brooks Bauer, Michael R. Brooks and Bruce T. Bauer for Defendants and
Respondents.
******
The trial court granted summary judgment in favor of defendants and respondents
American Home Mortgage Servicing, Inc. (AHMSI) and Wells Fargo Bank, N.A., as
Trustee for the Certificateholders of Soundview Home Loan Trust 2007-OPTI, Asset-
Backed Certificates, Series 2007-OPTI (Wells Fargo), on the claims brought by plaintiff
and appellant Barbara Wolford relating to the nonjudicial foreclosure of her home. We
affirm. AHMSI and Wells Fargo met their threshold burden to show they satisfied the
requirements necessary for nonjudicial foreclosure, and appellant failed to raise a triable
issue of material fact. The trial court here was not bound by a ruling denying summary
judgment in a related case and appellant was not prejudiced by asserted improprieties in
the foreclosure process.
FACTUAL AND PROCEDURAL BACKGROUND
The Loan Transaction.
Appellant purchased the property located at 1832 Rockefeller Lane, Unit 8 in
Redondo Beach (Property) in 1999. On February 2, 2007, appellant entered into a loan
agreement (Loan) with Murray Mortgage (Murray) to borrow the principal amount of
$525,000. The Loan was secured by a deed of trust (Deed of Trust) on the Property, and
was designed to pay off an existing loan on the Property. The Deed of Trust named
Murray as the beneficiary and Premier Trust Deed Services, Inc. as the trustee. It
erroneously identified the trustor as “Barbara Wolford, A Single Man.” Appellant did
not notice the error.
Appellant signed both an adjustable rate note (Note) that reflected the Loan and
the Deed of Trust. The Note obligated appellant to make monthly payments commencing
on April 1, 2007 to Murray; it also gave Murray the express right to transfer the Note.
The Deed of Trust likewise advised appellant that the Note—together with the Deed of
Trust—may be sold one or more times without notice, and that Murray had the right to
substitute a successor trustee. It further provided that in the event of appellant’s failure to
make a monthly payment when due, Murray would have the right to record a notice of
default and proceed with the sale of the Property.
2
Simultaneously, appellant signed a number of documents that disclosed various
features of the Loan, including a servicing disclosure statement indicating Murray’s
intent to immediately transfer, sell or assign the serving of appellant’s Loan. The closing
statement that accompanied the transaction reflected a number of fees, including a
prepayment fee for appellant’s existing loan and an over $6,000 origination fee.
Appellant signed a notice of right to cancel, acknowledging her right to cancel the
transaction within three days. Though she admitted signing the Loan documents, she
denied receiving two copies of the notice and averred that the disclosures did not contain
the information required by law.
In early February 2007, Murray assigned its beneficial interest in the Note and
Deed of Trust (2007 Assignment) to Option One Mortgage Corporation (Option One),
and Option One advised appellant of the transfer in a February 12, 2007 letter. On
March 12, 2007, appellant quitclaimed her interest in the Property to Rene Rodriguez in
an unrecorded deed. Appellant contended she did so in response to a dispute with her
homeowner’s association and that she intended to record the deed only in the event of a
judgment against her.
After appellant failed to make her September and October 2007 payments, Option
One sent her a letter advising she was in default and it would accelerate her Loan balance
and proceed with foreclosure if she did not cure her default within 30 days. Appellant
thereafter cured her default and made timely payments through the end of 2007.
Appellant defaulted on her January and February 2008 payment obligations, and Option
One sent her another letter informing her of the consequences of a default. Appellant
made a payment in mid-March that was insufficient to cure her default.
In a March 25, 2008 telephone conversation, appellant agreed to a proposed
payment plan involving an initial down payment followed by six monthly payments
designed to pay off the $8,638.52 in arrears and bring the Loan current. On April 5,
2008, appellant signed the agreement reflecting this plan (First Forbearance) and made
the initial down payment. Nonetheless, Option One sent appellant a letter dated April 3,
2008 indicating that the payment did not represent the total amount due and that the Loan
3
remained in default. Appellant made no further payments under the First Forbearance
and it was terminated. In May 2008, appellant verbally agreed to a modified payment
plan involving another down payment and eight monthly payments to bring the Loan
current (Second Forbearance), but she failed to make the initial down payment. In early
June 2008, appellant verbally agreed to another payment plan involving a down payment
and seven monthly payments to cure the $16,801.52 arrearage and bring the Loan current
(Third Forbearance). Option One transmitted a proposed agreement to appellant
reflecting the terms of the Third Forbearance, but appellant failed to make the third
required payment.
Effective July 1, 2008, Option One transferred the servicing of appellant’s Loan to
AHMSI; appellant received notice of the transfer. Appellant thereafter applied for a loan
modification with AHMSI. In September 2008, appellant executed a loan modification
agreement (Loan Modification) that provided for a step interest rate—as opposed to the
adjustable interest rate contained in the Note—and initially reduced the monthly payment
amount. According to the Loan Modification, appellant was to begin making regular
monthly payments beginning on December 1, 2008. After appellant failed to make any
payments on December 1, 2008 and January 1, 2009, AHMSI sent appellant a letter in
mid-January 2009 advising that she was in default and AHMSI would proceed with
foreclosure if she did not cure her default in 30 days. During a February 11, 2009
telephone conversation, appellant agreed to a payment plan involving her payment of an
initial down payment followed by seven monthly payments to satisfy the $11,768.79
arrearage and bring the Loan current (Fourth Forbearance). AHMSI thereafter
transmitted to appellant a written agreement reflecting the Fourth Forbearance, and
appellant timely paid the initial down payment amount. Appellant made no payments on
the Loan between March and July 2009.
Effective May 11, 2009, AHMSI assigned its beneficial interest in the Note and
Deed of Trust to Wells Fargo (2009 Assignment). AHMSI vice-president Korell Harp
signed the 2009 Assignment before a notary on June 9, 2009. A substitution of trustee
dated May 14, 2009 (2009 Substitution) substituted AHMSI Default Services, Inc.
4
(AHMSI Default) as the trustee under the Deed of Trust. AHMSI assistant secretaries
Bethany Hood and Rick Wilken signed the 2009 Substitution and their signatures were
notarized on May 18, 2009. On May 15, 2009, AHMSI Default caused a notice of
default and election to sell under a deed of trust (Notice of Default) to be recorded against
the Property. Notice of the 2009 Substitution was mailed on July 20, 2009.
During an August 11, 2009 telephone conversation, appellant agreed to another
payment plan that involved her making an initial down payment and seven monthly
payments designed to pay off the $32,183.46 arrearage and bring the Loan current (Fifth
Forbearance). After appellant digitally signed the Fifth Forbearance on August 16, 2009,
she did not timely make the initial down payment. The next day, AHMSI Default caused
a notice of trustee’s sale to be recorded against the Property, notifying appellant that her
Property would be sold at a public auction on September 8, 2009 if she failed to cure her
default.
On August 19, 2009, appellant telephoned AHMSI regarding the notices posted on
her door indicating a foreclosure sale date. The next day, appellant paid the initial down
payment amount under the Fifth Forbearance. She thereafter failed to make the payment
due in September and the Fifth Forbearance was terminated. In a September 25, 2009
letter, AHMSI advised appellant that her failure to comply with the terms of the Fifth
Forbearance had rendered that agreement null and void, and that it would proceed with
foreclosure proceedings without further demand. According to appellant, she tendered
payments of $6,266.50 on September 4 and October 7, 2009.
The Property was sold at a public auction on October 8, 2009 and Wells Fargo
became the owner.
On October 13, 2009, appellant filed her initial complaint. Before the hearing on a
demurrer filed by AHMSI and Wells Fargo, appellant filed the operative first amended
complaint, alleging 19 causes of action against AHMSI, Option One, TD Service
Company and Wells Fargo.1 AHMSI and Wells Fargo again demurred. Following a
1 Only AHMSI and Wells Fargo have appeared in this action.
5
May 2010 hearing, the trial court overruled the demurrer to the first through sixth,
thirteenth, seventeenth and nineteenth causes of action, sustained the demurrer with leave
to amend as to three other causes of action and sustained the demurrer without leave to
amend as to all other causes of action. Appellant elected not to amend. Accordingly, the
operative complaint alleged causes of action for declaratory relief; injunctive relief;
determination of lien pursuant to California Uniform Commercial Code section 9313;
breach of contract and the implied covenant of good faith and fair dealing; violation of
the Truth in Lending Act (15 U.S.C. § 1601 et seq.); violation of the Real Estate
Settlement and Procedures Act (12 U.S.C. § 2601 et seq.); rescission; unconscionability;
and quiet title. AHMSI and Wells Fargo answered, denying the allegations and asserting
multiple affirmative defenses.
In December 2009, the trial court in a related unlawful detainer action brought by
Wells Fargo against appellant had denied summary judgment, finding triable issues of
material fact with regard to the conduct of the foreclosure sale. Subsequently, in
February 2010, the trial court granted appellant’s ex parte application to consolidate and
stay the pending unlawful detainer action.
In June 2011, AHMSI and Wells Fargo moved for summary judgment and,
alternatively, for summary adjudication. In addition to several procedural arguments,
AHMSI and Wells Fargo asserted that appellant’s claims failed because the undisputed
evidence established the nonjudicial foreclosure was conducted regularly and properly.
In support of the motion AHMSI and Wells Fargo offered the declaration of AHMSI
assistant secretary Cindi Ellis; copies of Loan documents; excerpts from appellant’s
deposition; and discovery responses. They also requested judicial notice of a number of
recorded documents concerning the Property.
Appellant opposed the motion, asserting there were triable issues of fact as to
whether some or all of the documents ultimately providing AHMSI Default with the
authority to record the Notice of Default were void. In support of her opposition, she
submitted many of the same documents relating to the Property offered by AHMSI and
Wells Fargo, as well as copies of checks dated August through October 2009. She sought
6
judicial notice of documents in a Texas action filed by AHMSI against entities it alleged
engaged in unauthorized “surrogate signing” on its behalf, copies of other assignments
showing varying iterations of Korell Harp’s signature, deeds of trust identifying appellant
as “a single woman,” and documents purporting to show the corporate suspension of
Option One and the license revocation of Option One and AHMSI. Finally, appellant
submitted her own declaration describing her Loan transactions. AHMSI and Wells
Fargo filed evidentiary objections to portions of appellant’s evidence.
Following a September 27, 2011 hearing, the trial court granted the motion,
finding no triable issue of material fact. It did not rule on the evidentiary objections.
Judgment was entered in October 2011 and this appeal followed.2
DISCUSSION
Appellant contends the denial of summary judgment in the related unlawful
detainer action and evidence of irregularities in the foreclosure process demonstrated
triable issues of material fact warranting the denial of summary judgment. We find no
merit to her contentions.
I. Standard and Scope of Review.
A defendant moving for summary judgment “bears the burden of persuasion that
there is no triable issue of material fact and that [the defendant] is entitled to judgment as
a matter of law.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) To meet
this burden, the defendant must show one or more elements of the cause of action cannot
2 While the appeal was pending, we granted appellant’s motion to augment the
record and her request for judicial notice. We grant appellant’s outstanding request for
judicial notice as to Exhibits N through P and deny the request as to Exhibit Q.
Exhibit N, a plea agreement, and Exhibit P, a New York state court decision, are court
records (Evid. Code, § 452, subd. (d)(2)), and Exhibit O, copies of recorded documents,
reflects an official governmental act (Evid. Code, § 452, subd. (c)). We do not take
judicial notice of the factual matters contained within those documents. (E.g., Herrera v.
Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366, 1375.) Exhibit Q, a
pooling and service agreement, is not the type of matter that is subject to judicial notice.
(Gould v. Maryland Sound Industries, Inc. (1995) 31 Cal.App.4th 1137, 1145 [“we hold
the existence of a contract between private parties cannot be established by judicial notice
under Evidence Code section 452, subdivision (h)”].)
7
be established, or that there is a complete defense to that cause of action. (Code. Civ.
Proc., § 437c, subd. (o)(2); Aguilar v. Atlantic Richfield Co., supra, at p. 850.) Once the
moving party’s burden is met, the burden shifts to the plaintiff to demonstrate the
existence of a triable issue of material fact. (Silva v. Lucky Stores, Inc. (1998) 65
Cal.App.4th 256, 261.) “‘In order to avert summary judgment the plaintiff must produce
substantial responsive evidence sufficient to establish the existence of a triable issue of
material fact on the issues raised by the plaintiff’s causes of action.’ [Citation.]” (Leek v.
Cooper (2011) 194 Cal.App.4th 399, 417.) “[R]esponsive evidence that gives rise to no
more than mere speculation cannot be regarded as substantial, and is insufficient to
establish a triable issue of material fact.” (Sangster v. Paetkau (1998) 68 Cal.App.4th
151, 163.)
We review a grant of summary judgment de novo, “considering ‘all of the
evidence set forth in the [supporting and opposition] papers, except that to which
objections have been made and sustained by the court, and all [uncontradicted] inferences
reasonably deducible from the evidence.’ [Citation.]” (Artiglio v. Corning, Inc. (1998)
18 Cal.4th 604, 612.) “In independently reviewing a motion for summary judgment, we
apply the same three-step analysis used by the superior court. We identify the issues
framed by the pleadings, determine whether the moving party has negated the opponent’s
claims, and determine whether the opposition has demonstrated the existence of a triable,
material factual issue.” (Silva v. Lucky Stores, Inc., supra, 65 Cal.App.4th at p. 261.)
“On review of summary judgment, the appellant has the burden of showing error,
even if he did not bear the burden in the trial court. [Citation.]” (Claudio v. Regents of
University of California (2005) 134 Cal.App.4th 224, 230.) Thus, “[a]lthough our review
of a summary judgment is de novo, it is limited to issues which have been adequately
raised and supported in plaintiff’s brief. [Citations.] Issues not raised in an appellant’s
brief are deemed waived or abandoned. [Citation.]” (Reyes v. Kosha (1998) 65
Cal.App.4th 451, 466, fn. 6; see also Christoff v. Union Pacific Railroad Co. (2005) 134
Cal.App.4th 118, 125 [on appeal from summary judgment, “an appellant’s failure to
discuss an issue in its opening brief forfeits the issue on appeal”].) “‘[D]e novo review
8
does not obligate us to cull the record for the benefit of the appellant in order to attempt
to uncover the requisite triable issues. As with an appeal from any judgment, it is the
appellant’s responsibility to affirmatively demonstrate error and, therefore, to point out
the triable issues the appellant claims are present by citation to the record and any
supporting authority.’” (Claudio v. Regents of University of California, supra, at p. 230.)
In her opening brief, appellant has raised issues relating only to the effect of a
ruling in another action and improprieties in the documentation leading to foreclosure.
Liberally construed, her arguments address the claims asserted in her causes of action for
declaratory relief, injunctive relief, determination of lien, breach of contract and quiet
title. Appellant’s arguments do not touch on the allegations in her causes of action for
violation of federal statutes, the Truth in Lending Act and the Real Estate Settlement and
Procedures Act; for rescission based on noncompliance with the Truth in Lending Act;
and for unconscionability.3 “[A]n appellant’s failure to discuss a theory of liability on
appeal constitutes abandonment of that theory.” (Los Angeles Equestrian Center, Inc. v.
City of Los Angeles (1993) 17 Cal.App.4th 432, 444; accord, Walker v. Sonora Regional
Medical Center (2012) 202 Cal.App.4th 948, 957, fn. 6.) Accordingly, we deem
appellant to have forfeited any challenge to summary judgment on the fifth, sixth,
thirteenth and seventeenth causes of action.
II. AHMSI and Wells Fargo Met Their Burden to Show They Were Entitled to
Judgment as a Matter of Law.
Appellant’s remaining causes of action challenged the nonjudicial foreclosure
process. More specifically, appellant alleged that AHMSI and Wells Fargo failed to
properly secure any interest in the Property entitling them to commence foreclosure
proceedings; they fraudulently induced her to enter into the Loan and forbearances with
3 Though appellant discussed these claims in her reply brief in response to
AHMSI’s and Wells Fargo’s arguments, it is well established that “we do not consider
arguments raised for the first time in a reply brief.” (Estate of Bonzi (2013) 216
Cal.App.4th 1085, 1106, fn. 6; accord, Authority for California Cities Excess Liability v.
City of Los Altos (2006) 136 Cal.App.4th 1207, 1216, fn. 2; Reichardt v. Hoffman (1997)
52 Cal.App.4th 754, 764–765.)
9
misleading information; they recorded defective deeds and assignments; and they
wrongfully refused to accept her tender of payment due before foreclosing.
“Civil Code sections 2924 through 2924k provide a comprehensive framework for
the regulation of a nonjudicial foreclosure sale pursuant to a power of sale contained in a
deed of trust. . . . [¶] The statutory scheme can be briefly summarized as follows. Upon
default by the trustor, the beneficiary may declare a default and proceed with a
nonjudicial foreclosure sale. [Citations.] The foreclosure process is commenced by the
recording of a notice of default and election to sell by the trustee. [Citations.] After the
notice of default is recorded, the trustee must wait three calendar months before
proceeding with the sale. [Citations.] After the 3-month period has elapsed, a notice of
sale must be published, posted and mailed 20 days before the sale and recorded 14 days
before the sale. [Citations.] . . . The property must be sold at public auction to the
highest bidder. [Citations.] [¶] During the foreclosure process, the debtor/trustor is
given several opportunities to cure the default and avoid the loss of the property.”
(Moeller v. Lien (1994) 25 Cal.App.4th 822, 830; accord, Debrunner v. Deutsche Bank
National Trust Co. (2012) 204 Cal.App.4th 433, 440–441 [describing the comprehensive
statutory framework governing nonjudical foreclosure].)
“A nonjudicial foreclosure sale is accompanied by a common law presumption
that it ‘was conducted regularly and fairly.’ [Citations.] This presumption may only be
rebutted by substantial evidence of prejudicial procedural irregularity. [Citation.] . . . It
is the burden of the party challenging the trustee’s sale to prove such irregularity and
thereby overcome the presumption of the sale’s regularity. [Citation.]” (Melendrez v.
D & I Investment, Inc. (2005) 127 Cal.App.4th 1238, 1258; see also Fontenot v. Wells
Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 272 [“a plaintiff in a suit for wrongful
foreclosure has generally been required to demonstrate the alleged imperfection in the
foreclosure process was prejudicial to the plaintiff’s interests”]; Knapp v. Doherty (2004)
123 Cal.App.4th 76, 86, fn. 4 [“A nonjudicial foreclosure sale is presumed to have been
conducted regularly and fairly; one attacking the sale must overcome this common law
presumption ‘by pleading and proving an improper procedure and the resulting
10
prejudice’”].) “Prejudice is not presumed from ‘mere irregularities’ in the process.
[Citation.]” (Fontenot v. Wells Fargo Bank, N.A., supra, at p. 272.)
Here, AHMSI and Wells Fargo met their initial burden on summary judgment to
show appellant’s claims lacked merit. The moving parties demonstrated they complied
with the statutory scheme governing nonjudicial foreclosure sales by presenting evidence
that appellant borrowed $525,000 to refinance the Property and executed the Deed of
Trust as security for the Loan; the Deed of Trust granted the trustee power to sell the
Property through a nonjudicial foreclosure if appellant defaulted on the Loan; appellant
defaulted on the Loan on multiple occasions and each time received notice of the
consequences of default; after the servicing of the Loan was transferred to AHMSI,
appellant negotiated the Loan Modification with it; AHMSI assigned its beneficial
interest in the Deed of Trust and Note to Wells Fargo, which in turn substituted AHMSI
Default as the trustee under the Deed of Trust; appellant defaulted on the Loan
Modification; AHMSI Default recorded the Notice of Default and subsequently the
notice of trustee’s sale; appellant did not cure her final default; and the Property was sold
at a public auction. This evidence was sufficient to shift the burden to appellant to
establish a triable issue on her claims. (See Knapp v. Doherty, supra, 123 Cal.App.4th at
pp. 87–88.)
III. Appellant Failed to Meet Her Burden to Show There Was a Triable Issue of
Fact Precluding Summary Judgment.
A. The Ruling in the Unlawful Detainer Action Had No Preclusive Effect.
Appellant’s initial argument is that the denial of summary judgment in a related
unlawful detainer action mandated the same result here. We have taken judicial notice of
documents showing Wells Fargo filed an unlawful detainer action against appellant and,
in December 2009, moved for summary judgment in that action. Following a
December 17, 2009 hearing, the trial court denied the motion, finding “material issues of
fact with regard to the conduct of the foreclosure sale.” Appellant asserts that because
the same factual issues were raised in the summary judgment motion filed in the unlawful
detainer action and the summary judgment motion filed in this action, the trial court here
11
was required to conclude that a triable issue of material fact existed. The law is to the
contrary.
Where two separate actions are involved, the doctrines of res judicata or collateral
estoppel may apply to bar relitigation.4 Under the res judicata doctrine, a party is barred
from relitigating “the same cause of action in a second suit between the same parties or
parties in privity with them.” (Mycogen Corp v. Monsanto Co. (2002) 28 Cal.4th 888,
896.) Under the collateral estoppel doctrine, a party is precluded from relitigating an
issue decided in a prior litigation even if the causes of action were different. (Ibid.;
Vandenberg v. Superior Court (1999) 21 Cal.4th 815, 828.) Both doctrines require that
the prior proceeding result in a final judgment on the merits. (State Bar of California v.
Statile (2008) 168 Cal.App.4th 650, 671, fn. 17; Whittlesey v. Aiello (2002) 104
Cal.App.4th 1221, 1226.) Thus, a final judgment in an unlawful detainer action may bar
the subsequent litigation of claims alleging irregularities in a nonjudicial foreclosure sale.
(Vella v. Hudgins (1977) 20 Cal.3d 251, 255–258; Malkoskie v. Option One Mortgage
Corp. (2010) 188 Cal.App.4th 968, 972–976.) “But an order denying summary judgment
is not a final judgment and is not res judicata. [Citation.]” (Lumbermens Mut. Cas. Co.
v. Vaughn (1988) 199 Cal.App.3d 171, 177; see also De La Pena v. Wolfe (1986) 177
Cal.App.3d 481, 485 [same].) Thus, the order denying summary judgment in the
unlawful detainer action had no binding effect on subsequent litigation challenging the
propriety of the nonjudicial foreclosure process.
B. Appellant’s Evidence Failed to Demonstrate a Material Issue of Fact
Sufficient to Void the Nonjudicial Foreclosure.
Appellant contends that she offered sufficient evidence to create a triable issue of
fact as to whether the nonjudicial foreclosure sale was conducted in accordance with the
statutory scheme. A foreclosure may be vacated where “‘there has been fraud in the
procurement of the foreclosure decree or where the sale has been improperly, unfairly or
4 Appellant’s only citation on this point is to Alvarez v. Superior Court (2004) 117
Cal.App.4th 1107, 1111, which involved successive rulings by different judges in a single
action—circumstances distinct from those presented here.
12
unlawfully conducted, or is tainted by fraud, or where there has been such a mistake that
to allow it to stand would be inequitable to purchaser and parties.’ [Citation.]” (Lo v.
Jensen (2001) 88 Cal.App.4th 1093, 1097–1098.) We address each claimed irregularity
in turn.
1. Forgery.
First, appellant contends she offered evidence to establish a triable issue as to
whether Korell Harp’s signature on the 2009 Assignment and Bethany Hood’s signature
on the 2009 Substitution were forged or “robo-signed.”5 In support of her forgery
allegation, appellant submitted a petition filed by AHMSI against Lender Processing
Services, Inc. and DOCX, LLC, alleging in a separate action in Texas that those entities
acted outside the scope of their authority in engaging in robo-signing, and examples of
recorded documents signed by Korell Harp that appear to exhibit differences in his
signature. She asserts that if the 2009 Assignment and 2009 Substitution were forged,
then AHMSI Default lacked authority to initiate nonjudicial foreclosure proceedings.
(See generally Montgomery v. Bank of America (1948) 85 Cal.App.2d 559, 564 [“a
forged deed does not convey anything and cannot be made the foundation of a good
title”].)
The prevailing view is that plaintiff homeowners lack standing to challenge the
validity of robo-signatures. (Bennett v. Wells Fargo Bank, N.A. (N.D. Cal. 2013) 2013
WL 4104076 at *6.) “The reasoning is that the plaintiff lacks standing to contest the
validity of a robo-signature, because his foreclosure was the result of not making
payments and entering default, such that he did ‘not suffer an injury as a result of the
assignment of deed of trust, even if the assignment was fraudulent.’ [Citation.]” (Ibid.)
5 The practice of “robo-signing” has been used to “describe a robotic process of the
mass production of false and forged execution of mortgage assignments, satisfactions,
affidavits and other legal documents related to mortgage foreclosures and legal matters
being created by persons without knowledge of the facts being attested to.” (See
http://en.wikipedia.org/wiki/2010—United—States—foreclosure—crisis, as of
December 27, 2011.)
13
The circumstances here are no different than those in Javaheri v. JPMorgan Chase Bank,
N.A. (C.D. Cal. 2012) 2012 WL 3426278, where the district court accepted as true the
proposition that a substitution of trustee was robo-signed but concluded such evidence
failed to raise a triable issue of fact because the plaintiff lacked standing to challenge the
foreclosure on that basis. The court explained: Plaintiff “Javaheri was not party to this
assignment, and did not suffer any injury as a result of the assignment. Instead, the only
injury Javaheri alleges is the pending foreclosure on his home, which is the result of his
default on his mortgage. The foreclosure would occur regardless of what entity was
named as trustee, and so Javaheri suffered no injury as a result of this substitution.
[Citation.]” (Id. at *6; accord, Carollo v. Vericrest Financial, Inc. (N.D. Cal. 2012) 2012
WL 4343816 at *3 [holding homeowner-plaintiff lacks standing to complain about
forgery because the “claimed injury is foreclosure. The foreclosure resulted from a
default which would have occurred regardless of what entity was named as trustee. Thus,
the homeowner-plaintiff does not suffer an injury as a result of the assignment of deed of
trust, even if the assignment was fraudulent”]; but cf. Glaski v. Bank of America (2013)
218 Cal.App.4th 1079, 1097, fn. 16 [finding forgery a question of fact under New York
law].)
In accordance with the prevailing view, we conclude appellant’s evidence of robo-
signing was insufficient to create a triable issue of fact in the absence of any evidence of
prejudice.
2. Uniform Commercial Code section 9313.
Appellant next contends she raised a triable issue of fact as to whether AHMSI
and Wells Fargo perfected their interests in the Note and Deed in accordance with the
requirements of Uniform Commercial Code section 9313. (See Cal. U. Com. Code,
§§ 9308, subd. (e) [“Perfection of a security interest in a right to payment or performance
also perfects a security interest in a security interest, mortgage, or other lien on personal
or real property securing the right”; 9313, subd. (a) [“a secured party may perfect a
security interest in tangible negotiable documents, goods, instruments, money, or tangible
chattel paper by taking possession of the collateral”].)
14
The court in Debrunner v. Deutsche Bank National Trust Co., supra, 204
Cal.App.4th at pages 440 to 441, rejected a similar contention, stating: “Plaintiff’s
reliance on the California Uniform Commercial Code provisions pertaining to negotiable
instruments is misplaced. ‘The comprehensive statutory framework established [in
section 2924 to 2924k] to govern nonjudicial foreclosure sales is intended to be
exhaustive.’ [Citations.] ‘Because of the exhaustive nature of this scheme, California
appellate courts have refused to read any additional requirements into the non-judicial
foreclosure statute.’ [Citations.] ‘There is no stated requirement in California’s non-
judicial foreclosure scheme that requires a beneficial interest in the Note to foreclose.
Rather, the statute broadly allows a trustee, mortgagee, beneficiary, or any of their agents
to initiate non-judicial foreclosure. Accordingly, the statute does not require a beneficial
interest in both the Note and the Deed of Trust to commence a non-judicial foreclosure
sale.’ [Citation.] Likewise, we are not convinced that the cited sections of the California
Uniform Commercial Code . . . displace the detailed, specific, and comprehensive set of
legislative procedures the Legislature has established for nonjudicial foreclosures.
[Citations.]” We see no basis to depart from this authority and therefore conclude that
AHMSI and Wells Fargo had no obligation to satisfy Uniform Commercial Code section
9313 to conduct the nonjudicial foreclosure.
3. Document irregularities.
Appellant next points to errors in certain documents leading to foreclosure and
argues she raised a triable issue of fact as to whether those instruments were void.
She first notes that while her initial deed to the Property identified her as
“BARBARA ANN WOLFORD, A SINGLE WOMAN,” the Deed of Trust erroneously
identified her as “BARBARA WOLFORD, A SINGLE MAN.” Both the 2007
Assignment and the 2009 Assignment likewise identified appellant as a single man.6 She
contends that the misidentification raised a triable issue of fact as to whether the Deed of
6 The assignment to Option One contained a handwritten notation crossing out
“man” and replacing it with “woman.”
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Trust was void on its face. (See Gov. Code, § 27288.1, subd. (a) [document effecting or
evidencing a transfer or encumbrance of an interest in real property must contain “the
name or names in which the interest appears of record”].)
Again, we conclude this evidence was insufficient to create a triable issue of
material fact. Appellant has not identified any other errors in the Deed of Trust, nor has
she indicated that either the parties to the Deed of Trust or any third parties were misled
by the identification of her as a single man. Under these circumstances, the
misidentification “was obviously a mere inadvertence or typographical error” that did not
affect the validity of the Deed of Trust. (Cunnyngham v. Mason-McDuffie Co. (1933)
218 Cal. 196, 201 [acknowledgement that erroneously used the word “they” instead of
“he” held not defective]; see also Hanlon v. Western Loan & Bldg. Co. (1941) 46
Cal.App.2d 580, 601 [finding valid a notice of election to sell that correctly described the
city in which the property was located but added an incorrect county, as under applicable
rules of construction “the superfluous words ‘Alameda County’ could have been deleted
from the notice, leaving the notice complete and correct”].)
Second, she argues that the absence of a notary seal and commission number on
the acknowledgment for the 2007 Assignment raised a triable issue of fact as to whether
it and subsequent transactions stemming therefrom were void. Appellant’s contention
comes too late to raise a triable issue of fact. Civil Code section 1207 provides: “Any
instrument affecting the title to real property, one year after the same has been copied into
the proper book of record, kept in the office of any county recorder, imparts notice of its
contents to subsequent purchasers and encumbrancers, notwithstanding any defect,
omission, or informality in the execution of the instrument, or in the certificate of
acknowledgment thereof, or the absence of any such certificate . . . .” Because the
undisputed evidence showed that the 2007 Assignment was recorded in July 2007, any
defect in the acknowledgment was insufficient to raise a triable issue of fact after the
expiration of one year—or by July 2008—well before appellant filed her complaint. (See
Mercantile Trust Co. v. All Persons (1920) 183 Cal. 369, 377 [where instrument lacked a
proper acknowledgment, evidence it had been recorded for more than one year “serve[d]
16
the purpose of the proof of genuineness ordinarily required as a prerequisite to the
introduction in evidence of an instrument or its record”]; Thomas v. Speck (1941) 47
Cal.App.2d 512, 517–518 [though acknowledgment of declaration homestead was
defective in that the notary did not “personally know” the declarant, the defect was cured
after instrument had been on record for one year]; see also Wilson v. Pacific Coast Title
Ins. Co. (1951) 106 Cal.App.2d 599, 602 [unacknowledged and unrecorded assignment
of deed of trust, acknowledged two years after it was signed, effected “valid transfer of
title”].)
Finally, appellant contends she raised a triable issue of material fact by submitting
evidence that Option One was a suspended corporation and that its financial services
license had been revoked.7 She asserts that evidence of Option One’s corporate
suspension and/or license revocation raised a triable issue as to whether it received any
interest in the Property via the 2007 Assignment. But the suspension of Option One’s
corporate status would not have rendered the 2007 Assignment void; contracts into which
a suspended corporation enters are not void but merely voidable “at the instance of any
party to the contract other than the [suspended corporation].” (Rev. & Tax. Code,
§ 23304.1, subd. (a); accord, Performance Plastering v. Richmond American Homes of
California, Inc. (2007) 153 Cal.App.4th 659, 668–669 (Performance Plastering).) As a
nonparty to the 2007 Assignment, appellant could not have sought to void it—only
Murray could have done so. (Rev. & Tax. Code, § 23304.1, subd. (a).) Absent evidence
of Murray’s effort to void it, the 2007 Assignment remained valid notwithstanding the
suspension of Option One’s corporate status. (See Performance Plastering, supra, at
p. 669 [“A contract entered into by a suspended corporation is not void but is merely
voidable by the other party”]; Myrick v. O’Neill (1939) 33 Cal.App.2d 644, 648 [“‘a
7 While we liberally construe appellant’s evidence for the purpose of summary
judgment, we note that evidence of Option One’s suspension was current as of May 2010,
more than three years after the 2007 Assignment was executed, and that the business
address for Option One was different on the 2007 Assignment, record of corporate
suspension and record of license revocation.
17
voidable contract is one which may be rendered null at the option of one of the parties,
but is not void until so rendered,’” italics omitted].) Accordingly, evidence of Option
One’s suspension, without more, was insufficient to raise a triable issue as to the validity
of the 2007 Assignment.
C. Appellant Offered No Evidence of Prejudice.
“The issues raised by a motion for summary judgment are framed by the
pleadings. [Citation.]” (Dromy v. Lukovsky (2013) 219 Cal.App.4th 278, 282.) Here,
though appellant captioned her surviving claims as declaratory and injunctive relief,
breach of statute, breach of contract and quiet title, her allegations were consistent with
those typically pled in connection with claims for wrongful foreclosure. By way of
example, she alleged in her cause of action for injunctive relief that “[d]efendants
wrongfully commenced a foreclosure action and an unlawful detainer action under the
Note and conducted a non-judicial trustee sale wherein defendant WELLS FARGO
obtained title as the ‘beneficiary.’ Such wrongful and egregious conduct has caused
Plaintiff great and irreparable injury in that real property is unique, defendant WELLS
FARGO is not the original beneficiary under the Deed of Trust, defendant AHMSI is not
the original trustee, and neither adequately established their standing to conduct such a
sale. And none of the defendants followed the notice requirements under 2923 et seq.
Thus this sale is void and voidable.”
The elements of a wrongful foreclosure claim are: “(1) the trustee or mortgagee
caused an illegal, fraudulent, or willfully oppressive sale of real property pursuant to a
power of sale in a mortgage or deed of trust; (2) the party attacking the sale (usually but
not always the trustor or mortgagor) was prejudiced or harmed; and (3) in cases where
the trustor or mortgagor challenges the sale, the trustor or mortgagor tendered the amount
of the secured indebtedness or was excused from tendering. [Citations.]” (Lona v.
Citibank, N.A. (2011) 202 Cal.App.4th 89, 104.) Appellant failed to meet her burden to
raise a triable issue of fact for the independent reason she offered no evidence in support
of the requisite element of prejudice. (See Code Civ. Proc., § 437c, subd. (o)(2) [cause of
action has no merit if one element cannot be established].)
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A plaintiff seeking relief on the theory of wrongful foreclosure must demonstrate
that the imperfection in the foreclosure process prejudiced her interests. (Debrunner v.
Deutsche Bank National Trust Co., supra, 204 Cal.App.4th 443.) The type of prejudice
that must be shown is “‘that the foreclosure would have been averted but for [the] alleged
deficiencies.’ [Citations.]” (Albano v. Cal-Western Reconveyance Corp. (N.D. Cal.
2012) 2012 WL 5389922 at *6; see also Ghuman v. Wells Fargo Bank, N.A. (E.D. Cal.
2012) 2012 WL 2263276 at *5 [plaintiffs failed to show how defect in substitution of
trustee was prejudicial, “given Plaintiffs have offered no facts to suggest the substitution
of NDEx (or the allegedly improper recording thereof) adversely affected their ability to
pay their debt or cure their default”].) Here, the undisputed evidence showed appellant
had defaulted on the Loan and Loan Modification, and she offered no evidence to show
that the asserted improprieties in the foreclosure negatively affected her ability to pay or
prevented her from curing her defaults.8
The circumstances here are therefore akin to those in Fontenot v. Wells Fargo
Bank, N.A., supra, 198 Cal.App.4th 256, where the plaintiff sought to set aside a
foreclosure on the basis of an invalid assignment of the deed of trust. The court
explained: “Even if [deed of trust beneficiary] MERS lacked authority to transfer the
note, it is difficult to conceive how plaintiff was prejudiced by MERS’s purported
assignment, and there is no allegation to this effect. Because a promissory note is a
negotiable instrument, a borrower must anticipate it can and might be transferred to
another creditor. As to plaintiff, an assignment merely substituted one creditor for
another, without changing her obligations under the note. Plaintiff effectively concedes
she was in default, and she does not allege that the transfer to HSBC interfered in any
manner with her payment of the note [citation], nor that the original lender would have
refrained from foreclosure under the circumstances presented. If MERS indeed lacked
8 As evidence of her attempt to cure her default, appellant offered copies of two
uncashed checks dated early September and October 2009. The Fifth Forbearance,
however, required that payment be made by certified check or money order. Appellant
offered no evidence to show how that requirement prevented her from curing her default.
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authority to make the assignment, the true victim was not plaintiff but the original lender,
which would have suffered the unauthorized loss of a $1 million promissory note.” (Id.
at p. 272.) Here, too, the lack of evidence of prejudice was fatal to appellant’s claims.
DISPOSITION
The judgment is affirmed. Parties to bear their own costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS.
_____________________, J. *
FERNS
We concur:
____________________________, P. J.
BOREN
____________________________, J.
ASHMANN-GERST
* Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to
article VI, section 6 of the California Constitution.
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