Starr v. OneWest Bank CA4/3

Filed 11/6/13 Starr v. OneWest Bank CA4/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication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

FOURTH APPELLATE DISTRICT

DIVISION THREE

SANDRA STARR et al.,

Plaintiffs and Appellants, G047442

v. (Super. Ct. No. 30-2010-00427977)

ONEWEST BANK, FSB, OPINION

Defendant and Respondent.

Appeal from a judgment of the Superior Court of Orange County, Andrew
P. Banks, Judge. Affirmed.
Sandra Starr and Richard Starr, in pro. per., for Plaintiffs and Appellants.
Dykema Gossett, J. Kevin Snyder and Brian H. Newman for Defendant and
Respondent.

* * *
 Plaintiffs Sandra Starr and Richard Starr appeal from a judgment entered
after the court sustained without leave to amend the demurrer of defendant OneWest
Bank, FSB to the second amended complaint. Although the allegations are framed in a
variety of causes of action, the complaint essentially asserts defendant improperly began
and maintained non-judicial foreclosure proceedings after plaintiffs defaulted on a note
secured by a deed of trust on their residence and failed to properly evaluate their request
for refinance of the loan.
On appeal they contend the court erred in concluding their claims were
primarily based on violation of the Home Affordable Modification Program (HAMP1),
which does not allow a private right of action, and that instead each cause of action states
sufficient facts to constitute a claim. They primarily seek pain and suffering damages
due to the threat of losing their home. They have not sufficiently pleaded any of the
causes of action nor will they be able to do so. Thus we affirm.

FACTS AND PROCEDURAL HISTORY

Plaintiffs purchased their home in 2001 and refinanced it in 2006, executing
a $345,000 note secured by a deed of trust on that property. In August 2008 they wrote
to IndyMac Federal Bank, FSB (IndyMac FSB), which owned the loan, seeking a loan
modification. In September 2008 plaintiffs stopped making payments. In December
2008 a notice of default was recorded. A few months later defendant began servicing the
loan as a result of its purchase of the servicing rights when the original servicer, IndyMac
FSB, went into receivership.

1 HAMP was created by the United States Department of the Treasury and
associated federal agencies under the authority of the Emergency Economic Stabilization
Act (12 U.S.C. § 5201 et seq.).

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 In September 2009 plaintiffs contacted defendant and asked to be evaluated
for a modification of their loan under HAMP. A representative of defendant verbally
promised plaintiffs they would be considered for a modification if they provided all
necessary documents, i.e., the “Initial Package.” By the end of March 2010 plaintiffs
supplied the Initial Package but defendant requested additional information and claimed
not to have received everything plaintiffs had supplied. Plaintiffs faxed all requested
documents to defendant several times over the next year and a half through November
2011. Plaintiffs also allege defendant denied their request for a modification in March
2010 because they did not qualify for a loan workout.
In June 2010 plaintiffs were notified their request for a loan modification
was being considered and were apparently again asked to send the Initial Package.
Plaintiffs submitted a complete Initial Package by October but defendant repeatedly
asked for the same information.
In November 2010, while the application for the modification was still in
process, plaintiffs, in propria persona, filed their original complaint containing 18 causes
of action. When defendant filed a demurrer, plaintiffs filed an amended complaint,
adding eight more causes of action. The court sustained defendant’s demurrer to the first
amended complaint with leave to amend and plaintiffs retained an attorney who filed the
second amended complaint.
The second amended complaint2 lists 13 causes of action for negligence,
intentional and negligent misrepresentation, breach of oral contract and of the covenant
of good faith and fair dealing, promissory estoppel, intentional and negligent infliction of
emotional distress, unfair business practices (Bus. & Prof. Code, § 17200 et seq., UCL),

2 Although other parties are named we refer only to defendant.

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unfair debt collection practices (Civ. Code, § 1788 et seq.)3, slander of title, quiet title,
and to cancel foreclosure documents and enjoin a foreclosure sale. It alleges defendant is
jointly liable for all injuries and damages alleged.
In the general allegations, plaintiffs plead the “action is to remedy a
common[] plan or scheme and pattern and practice to obtain title and possession of
[p]laintiffs’ home . . . . [Defendant] (1) breached its duties . . . and other express and[/]or
implied promises made to [p]laintiff[s] to consider and evaluate [p]laintiffs for a HAMP
load modification in good faith[;] (2) continued to threaten foreclosure during [p]laintiffs’
HAMP evaluation; and (3) failed to comply with HAMP duties and standards precluding
[sic] [p]laintiffs a good faith evaluation under HAMP.” Defendant “acted without proper
authority under California law” (underscoring omitted) and failed to comply with the
terms of the trust deed.
Plaintiffs also state they are citing to HAMP and sections 2923.5 et seq.,
2924 et seq., and 2934a et seq., not to support a “private right of action, but as factual
allegations and prima facie proof of breaches of mandatory standard industry practices
and duties that violate federal/state regulations in support of each cause of action.”
(Underscoring omitted.)
Plaintiffs extensively allege the history and purpose of HAMP, quoting
some of its provisions. They plead “[s]ection 129” states the Department of Treasury
Guidelines issued under the Emergency Economic Stabilization Act of 2008 “shall
constitute standard industry practice.” (Boldface, italics & underscoring omitted.) They
also allege, without citation, HAMP was set up “to standardize industry practices” as to
modifications and must be followed. (Boldface & underscoring omitted.) They further
plead, again without identifying the source, that loan servicers must “consider all eligible
mortgage loans.” (Boldface & underscoring omitted.)

3 All further statutory references are to the Civil Code unless otherwise specified.

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 The second amended complaint alleged that to some extent defendant failed
to follow required procedures for foreclosing, in violation of sections 2924b, 2924f,
2924g, 2924.8, and 2934a. Citing the HAMP handbook4 plaintiffs allege several HAMP
violations by defendant. These include a refusal to consider a HAMP modification,
failure to offer a Trial Period Plan (TPP) or send a denial letter, failure to acknowledge
receipt of and review the Initial Package plaintiffs provided, failure to advise that the
Initial Package was incomplete, failure to provide plaintiffs with a single contact person,
and failure to suspend the foreclosure sale and to advise plaintiffs of same while the
HAMP request was pending.
Plaintiffs also plead that although they provided defendant with the Initial
Package, defendant continued to request updated documents for approximately a year
thereafter. Plaintiffs complied with these requests. Even when those documents were
submitted, defendant failed to approve a TPP or issue a letter denying a HAMP
modification.
The specific allegations as to each cause of action are set out in the
discussion.
Plaintiffs’ alleged damages include emotional distress and physical injury,
requiring medical care and medication.
Defendant filed a demurrer to the second amended complaint. While it was
pending, as plaintiffs acknowledged in their opposition to the demurrer, defendant
approved plaintiffs for a TPP under HAMP and, when that was completed, offered
plaintiffs a permanent loan modification.

4 Plaintiffs cite to a version of the handbook that was not promulgated until
September 2011, well after most of the alleged misconduct. They also failed to provide a
copy of the applicable handbook.

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 The court sustained the demurrer without leave to amend, ruling that the
claims were largely based on alleged violations with HAMP, under which plaintiffs had
no standing to sue. Further, some claims were moot because the loan modification had
been offered to plaintiffs.

DISCUSSION

1. Introduction
“When reviewing a judgment dismissing a complaint after the granting of a
demurrer without leave to amend, courts must assume the truth of the complaint’s
properly pleaded or implied factual allegations. [Citation.]” (Schifando v. City of Los
Angeles (2003) 31 Cal.4th 1074, 1081.) But we do not assume the truth of speculative
allegations (Rotolo v. San Jose Sports and Entertainment, LLC (2007) 151 Cal.App.4th
307, 318) or “contentions, deductions or conclusions of law” (Aubry v. Tri-City Hospital
Dist. (1992) 2 Cal.4th 962, 967). “[W]e give the complaint a reasonable interpretation,
and read it in context. [Citation.]” (Schifando v. City of Los Angeles, supra, 31 Cal.4th
at p. 1081.) If the demurrer can be sustained on any ground raised, we must affirm.
(Ibid.) If the court sustains a demurrer without leave to amend and a plaintiff seeks leave
to amend, he or she must demonstrate how the complaint could be amended to state a
valid cause of action. (Ibid.)

2. Rosenthal Fair Debt Collection Practices Act
The Rosenthal Fair Debt Collection Practices Act (§ 1788 et seq.;
Rosenthal Act) was enacted, in part, “to prohibit debt collectors from engaging in unfair
or deceptive acts or practices in the collection of consumer debts.” (§ 1788.1, subd. (b).)
Those unfair practices include threats, harassment, use of profanity, and “false simulation

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of the judicial process.” (Sipe v. Countrywide Bank (E.D.Cal. 2010) 690 F.Supp.2d 1141,
1151.)
Plaintiffs allege defendant violated the Rosenthal Act by wrongfully
threatening to foreclose on their property, knowing it was a violation of foreclosure
statutes and HAMP and because it rescheduled the foreclosure sale multiple times while
plaintiffs’ HAMP application to modify their loan was pending.
But foreclosing under a trust deed is not debt collection under the Rosenthal
Act. (Sipe v. Countrywide Bank, supra, 690 F.Supp.2d at p. 1151; accord, Moriarity v.
Nationstar Mortgage, LLC (E.D.Cal. July 3, 2013, No. 1:13-cv-00855-AWI-SMS) 2013
WL 3354448; Velasco v. Homewide Lending Corp. (C.D.Cal. June 21, 2013, No. SACV
13-00698-CJC (RNBx)) 2013 WL 3188854; Tarsha v. Bank of America, N.A. (S.D.Cal.
Mar. 29, 2013, No. 11-cv-928-W(MDD)) 2013 WL 1316682.) The Rosenthal Act
applies to the collection of consumer debts (§ 1788.2, subd. (b)), those owed resulting
from a “consumer credit transaction” (§ 1788.2, subd. (f)), i.e., where “property, services
or money is acquired on credit . . . primarily for personal, family, or household purposes”
(§ 1788.2, subd. (e)).
As plaintiffs cite, a few federal district court cases have deviated from the
general rule, but none dictates a different result here. For example, the complaint in
Ansanelli v. JP Morgan Chase Bank, N.A. (N.D.Cal. Mar. 28, 2011, No. C10-
03892(WHA) 2011 WL 1134451 was not based on claims under the Rosenthal Act.
In Herrera v. LCS Financial Services Corp. (N.D.Cal. Dec. 22, 2009, No.
C09-02843-TEH) 2009 WL 5062192 the creditor sent the plaintiff a demand letter
seeking payment on a second trust deed after the security had been extinguished by a
nonjudicial foreclosure by the first trust deed holder. In Walters v. Fidelity Mortgage
(E.D.Cal. 2010) 730 F.Supp.2d 1185, the court held the defendant was a debt collector
whose conduct went “beyond the scope of the ordinary foreclosure process.” (Id. at p.
1203.) The conduct was misrepresenting additional fees would be charged, which is a

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violation of section 1788.13, subdivision (e). This was sufficient to defeat the
defendant’s motion to dismiss her claim. (Walters v. Fidelity Mortgage, supra, 730
F.Supp.2d at p. 1204.) Ohlendorf v. American Home Mortgage Servicing (E.D.Cal.
2010) 279 F.R.D. 575 confirmed foreclosing on property that secures a debt is not
covered by the Rosenthal Act. (Id. at p. 582.) But the claim was allowed to stand
because the complaint did not mention foreclosure. (Ibid.)
In In re Bank of America HAMP Contract Litigation (D.Mass. July 6, 2011,
No. 10-md-02193-RWZ) 2011 WL 2637222 the plaintiffs filed a putative class action
and entered into a TPP with the defendant, making reduced payments on their mortgages
in exchange for a promise of a permanent loan modification, which they did not receive.
The defendants moved to dismiss the claim under the Rosenthal Act, arguing foreclosure
was not a debt collection nor were they debt collectors. The court denied the motion as
premature, merely citing three cases it characterized as holding mortgages on family
residences were consumer debts. (Id. at p. *6.) These included Walters v. Fidelity
Mortgage, supra, 730 F.Supp.2d 1185 and Ohlendorf v. American Home Mortgage
Servicing, supra, 279 F.R.D. 575, neither of which so held, as described above.
The third case was Reyes v. Wells Fargo Bank, N.A. (N.D.Cal. Jan. 3, 2011,
No. C-10-01667 JCS) 2011 WL 30759, where the plaintiffs alleged the defendants urged
them to enter into a six-month forbearance agreement with reduced payments, promising
to consider modification of their loan, knowing plaintiffs would never be able to pay the
modified loan amount. The plaintiffs made the payments but the defendants foreclosed
on their home during the six-month period. In their cause of action for violation of the
Rosenthal Act, the plaintiffs alleged the defendants were debt collectors using debt
collection practices of false, misleading and deceptive statements in their attempt to
collect on the mortgage.
Reyes acknowledged that “the process of foreclosure is not actionable as
‘debt collection’ under the Rosenthal Act.” (Reyes v. Wells Fargo Bank, N.A., supra,

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2011 WL 30759 at p. *20.) It noted, in a footnote, that it could not state “categorically”
collection on a mortgage could never give rise to a claim under the Rosenthal Act but that
analysis should depend on a defendant’s alleged actions. (Id. at p. *19, fn. 8.) In Reyes
the claim was not the mere act of foreclosure but making alleged deceptive statements.
(Id. at p. *20.)
Finally, the recent case, Corvello v. Wells Fargo Bank, N.A. (9th Cir. 2013)
728 F.3d 878 weighed in on this question when considering if the two consolidated cases
should have been dismissed for failure to state a claim. (Fed. Rules Civ.Proc., rule
12(b)(6); 28 U.S.C.) In Corvello, the primary issue was whether the defendant was
required to offer the plaintiffs permanent loan modifications after they complied with
their TPP’s. The court ruled the pleading was sufficient to state a claim on that basis.
(Corvello v. Wells Fargo Bank, N.A., supra, 728 F.3d at p. 885.)
In Corvello the Rosenthal Act claim was a secondary issue. The court
noted the defendant had acknowledged it was a debt collector as defined in the Rosenthal
Act. With no analysis, the court agreed with the district court’s finding the defendant
“was engaged in debt collection.” (Corvello v. Wells Fargo Bank, N.A., supra, 728 F.3d
at p. 885.) Relying on In re Bank of America HAMP Contract Litigation, supra, 2011
WL 2637222 and Reyes v. Wells Fargo Bank, N.A., supra, 2011 WL 30759, it determined
the “TPP was more than an informational circulation.” (Corvello v. Wells Fargo Bank,
NA, supra, 728 F.3d at p. 885.)
We are not necessarily convinced by Reyes’s reasoning about whether a
foreclosure is a debt collection under the Rosenthal Act or Corvello’s inconclusive
determination regarding the TPP, but even if we were, the allegations in the case before
us do not fall within the Rosenthal Act. Here, the claim is that defendant postponed the
foreclosure sale several times while considering the HAMP application. Postponing a
sale is well within the ordinary scope of foreclosure as is reporting derogatory
information to a credit bureau. Plaintiffs’ allegation defendant continued to make threats

9
while the HAMP application was pending is not supported by the exhibit to the second
amended complaint on which they rely, which contains a notice of foreclosure, a notice
of trustee’s sale, and several news releases prepared by plaintiffs claiming defendant was
illegally foreclosing. Moreover, here the TPP was executed after the alleged wrongful
conduct.
In sum, none of the cases nor the factual allegations on which plaintiffs rely
support their Rosenthal Act cause of action. There is no basis on which this claim could
be amended; therefore the demurrer was properly sustained without leave to amend.

3. Intentional and Negligent Misrepresentation
Plaintiffs allege claims for intentional and negligent misrepresentation. An
intentional fraud cause of action must plead a misrepresentation made with knowledge of
its falsity and with intent to defraud, justifiable reliance, and resulting damage.
(Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 990.) “‘The
elements of negligent misrepresentation are “(1) the misrepresentation of a past or
existing material fact, (2) without reasonable ground for believing it to be true, (3) with
intent to induce another’s reliance on the fact misrepresented, (4) justifiable reliance on
the misrepresentation, and (5) resulting damage.”’ [Citation.]” (Wells Fargo Bank, N.A.
v. FSI, Financial Solutions, Inc. (2011) 196 Cal.App.4th 1559, 1573.)
In the intentional misrepresentation cause of action plaintiffs allege
defendant falsely represented it would consider a loan modification but did not intend to
do so. They make virtually the same allegation in the negligent misrepresentation cause
of action. But plaintiffs affirmatively represented in their opposition to the demurrer that
defendant offered them a loan modification. They argued this was evidence defendant
admitted they were qualified for a HAMP modification, which modification should have
occurred two years earlier. But this actually defeats their allegation of intent to defraud.
The trial court relied on this representation in making its ruling, without objection by

10
plaintiffs. Plaintiffs do not raise this as an issue in their opening brief and they filed no
reply brief, thus failing to respond to defendant’s reliance on this representation in its
brief.
We treat the affirmative representation defendant offered plaintiffs a TPP
and permanent loan modification as pleaded. (See RealPro, Inc. v. Smith Residual Co.,
LLC (2012) 203 Cal.App.4th 1215, 1221, fn. 2 [in addition to allegations in complaint,
“‘we may consider other relevant matters of which the trial court could have taken
judicial notice and we may treat such matters as having been pleaded’”]; see also Del E.
Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604-605 [under
doctrine of truthful pleading, in deciding demurrer court may consider declarations filed
on the plaintiff’s behalf and the plaintiff’s responses to requests for admissions and
sustain demurrer when these conflict with allegations in facially valid complaint];
Hoffman v. Smithwoods RV Park, LLC (2009) 179 Cal.App.4th 390, 400 [“Under the
doctrine of truthful pleading, the courts ‘will not close their eyes to situations where a
complaint contains allegations of fact inconsistent with attached documents, or
allegations contrary to facts that are judicially noticed’”].)
Plaintiffs relied on the representation of the offer of the TPP and permanent
loan modification in support of their demurrer. It would be inequitable for us to ignore it
in ruling on the demurrer. The representation defeats an essential element of both
intentional and negligent misrepresentation. Again, there is no basis to amend because
plaintiffs cannot plead around a fact they have admitted. (See Berg & Berg Enterprises,
LLC v. Boyle (2009) 178 Cal.App.4th 1020, 1034 [in amended complaint the plaintiff
may not omit detrimental allegation from prior complaint].)

4. Negligence Claims
Plaintiffs raised claims of both negligence and negligent infliction of
emotional distress. To state a negligence cause of action a plaintiff must allege the

11
defendant owed the plaintiff a duty of care, defendant’s breach of that duty, and the
breach proximately caused the plaintiff’s damages. (Thomas v. Stenberg (2012) 206
Cal.App.4th 654, 662.) “[A]bsent a duty, the defendant’s care, or lack of care, is
irrelevant.” (Software Design & Application, Ltd. v. Hoefer & Arnett, Inc. (1996) 49
Cal.App.4th 472, 482.) Negligent infliction of emotional distress is not an independent
tort; it is the tort of negligence and has the same elements. (Potter v. Firestone Tire &
Rubber Co. (1993) 6 Cal.4th 965, 984.)
Plaintiffs allege defendant owed them a duty of care and “‘reasonable
efforts’” under HAMP, including a duty to consider any loan eligible for modification.
They also plead defendant had a duty to strictly comply with certain provisions of the
Making Home Affordable Handbook in connection with the request for a loan
modification under HAMP, as well as sections 2924 et seq., 2923.5 et seq., and 2934a et
seq., in servicing and foreclosing on loans.
A lender does not owe a borrower a duty of care when the relationship is
merely that of lender and borrower. (Jolley v. Chase Home Finance, LLC (2013) 213
Cal.App.4th 872, 898.) The same rule applies to loan servicers. (Somera v. IndyMac
Federal Bank, FSB (E.D.Cal. Mar. 3, 2010, No. 2:09-cv-01947-FCD-DAD) 2010 WL
761221, p. *5.)
Plaintiffs cite Ansanselli v. JP Morgan Chase Bank, N.A., supra, 2011 WL
1134451 in support of their argument. In Ansanselli the court found the defendant went
beyond its traditional role as a lender when it guaranteed it would modify the loan if the
plaintiff timely made all the payments due under a TPP. (Id. at p. *7.) But the holding in
Ansanelli is a minority view that we find unpersuasive.
Instead, we agree with the majority of cases that hold loan modifications do
not create a relationship beyond that of lender and borrower. In Bunce v. Ocwen Loan
Servicing, LLC (E.D.Cal. July 17, 2013, No. 2:13-00976 WBS EFB) 2013 WL 3773950,
for example, the plaintiff sued the defendant loan servicer for negligence, among other

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claims, based on facts strikingly similar to those in the case before us. He alleged the
defendant told him to submit applications to modify his loan, but repeatedly asked for the
same documents and then denied a modification without reviewing the application and
without explaining the basis for the refusal. The defendant also failed to then discuss
other ways to avoid foreclosure but instead began the foreclosure process.
The court held the defendant owed no duty because all of the defendant’s
alleged wrongful acts concerned its review of the application to modify the plaintiff’s
loan. This did not go beyond a traditional lender-borrower relationship. (Id. at p. *5; see,
e.g., Armstrong v. Chevy Chase Bank, FSB (N.D.Cal. Oct. 3, 2012, No. 5:11-cv-05664
EJD) 2012 WL 4747165, p. *4 [loan modification “is nothing more than a renegotiation
of loan terms”]; see also Alvarado v. Aurora Loan Services, LLC (C.D.Cal. Sept. 20,
2012, SACV 12-0524-DOC-JPRx) 2012 WL 4475330, p. *6; Johnston v. Ally Financial
Inc. (S.D.Cal. July 29, 2011, No. 11-CV-0998-H (BLM) 2011 WL 3241850, p. *4.)
Further, even if the reasoning in Ansanselli was correct, the case is
distinguishable because here the claims do not arise out of any negligence in connection
with the TPP.
Nor do violations of sections 2924 through 2924k give rise to a negligence
cause of action. (Residential Capital v. Cal-Western Reconveyance Corp. (2003) 108
Cal.App.4th 807, 827 [Legislature enacted “comprehensive statutory scheme” of conduct
of nonjudicial foreclosures; courts should not “graft[] a tort remedy” for violation of
statute]; see also Moeller v. Lien (1994) 25 Cal.App.4th 822, 834 [“The comprehensive
statutory framework established to govern nonjudicial foreclosure sales[, including] a
myriad of rules relating to notice” “is intended to be exhaustive. . . . It would be
inconsistent . . . to incorporate another unrelated cure provision into statutory nonjudicial
foreclosure proceedings”].)

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 As to section 2923.5, the only remedy for violation is postponement of the
foreclosure sale; a negligence claim does not lie. (Mabry v. Superior Court (2010) 185
Cal.App.4th 208, 223-224.)
The second amended complaint alleges defendant breached its duty to
record a valid substitution of trustee as required by section 2934a. Plaintiffs plead they
sustained general and special damages and also seek punitive damages as a result. They
claim they have “been left financially devastated,” have sustained damage to their credit,
were unable to work and lost income, and suffered physical and emotional harm. But
they have not specifically alleged how failure to record a valid substitution of trustee
harmed them. (See Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 272
[in suit for wrongful foreclosure the plaintiff must “demonstrate the alleged imperfection
in the foreclosure process was prejudicial . . . . Prejudice is not presumed from ‘mere
irregularities’ in the process”].) Moreover, any damage suffered would have been de
minimis and not actionable or recoverable. (Harris v. Time, Inc. (1987) 191 Cal.App.3d
449, 458.)
Because plaintiffs have not alleged a duty, neither cause of action is
adequate. Given that this was plaintiffs’ third attempt to plead these claims and they have
not suggested how they could cure the cause of action, leave to amend was properly
denied.

5. Intentional Infliction of Emotional Distress
The elements of a cause of action for intentional infliction of emotional
distress are a defendant’s outrageous conduct with the intent to cause, or a reckless
disregard of the likelihood of causing, emotional distress; and the defendant’s actual and
proximate cause of severe emotional distress suffered by the plaintiff. (Johnson v.
Ralphs Grocery Co. (2012) 204 Cal.App.4th 1097, 1108.) To be considered outrageous,
“‘“[c]onduct . . . must be so extreme as to exceed all bounds of that usually tolerated in a

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civilized society.”’ [Citations.]” (Ibid.) “The California Supreme Court has set a ‘high
bar’ for what can constitute severe distress. [Citation.] ‘Severe emotional distress means
“‘emotional distress of such substantial quality or enduring quality that no reasonable
[person] in civilized society should be expected to endure it.’” [Citations.]’ [Citations.]”
(Wong v. Jing (2010) 189 Cal.App.4th 1354, 1376.)
The alleged outrageous conduct was defendant’s violation of federal and
state statutes by continuing to threaten to foreclose during the pendency of an application
to modify plaintiffs’ loan under HAMP and its refusal to consider the application.
Plaintiffs conclusorily plead the conduct was “outrageous, extreme, fraudulent, deceptive,
unfair” and violated federal and common law. In their brief plaintiffs do not expand upon
the second amended complaint’s allegations, but merely state defendant’s conduct was
not privileged and was “outside the normally required conduct within the foreclosure
scheme” (italics omitted), beyond “‘all reasonable bounds of decency’ and may rise to the
level of outrageous conduct.” The cause of action is insufficient.
In Coleman v. Republic Indemnity Ins. Co. (2005) 132 Cal.App.4th 403 the
plaintiffs alleged the defendant had advised a claimant not to hire a lawyer and
misrepresented the statute of limitations within which to file a claim, both statutory
violations. The court ruled this was not a sufficient allegation to support a cause of
action for intentional infliction of emotional distress. (Id. at p. 417.) In so doing, it cited
a line of California cases that hold neither delay nor outright denial of insurance claims is
outrageous enough to support an intentional infliction of emotional distress cause of
action. (Ibid.)
Similarly a delay in considering a loan modification while continuing to
maintain a foreclosure proceeding does not support the cause of action. (See Lesley v.
Ocwen Financial Corp. (C.D.Cal. Mar. 13, 2013, No. SA CV 12-1737-DOC (JPRx))
2013 WL 990668, p. *11 [the defendant’s denial of HAMP modification because death of
the plaintiffs’ son was not considered a hardship, insufficient to support intentional

15
infliction of emotional distress cause of action]; Becker v. Wells Fargo Bank, NA, Inc.
(E.D.Cal. Nov. 30, 2012, No. 2:10-cv-02799 LKK KJN PS ) 2012 WL 6005759, p. *16
[intentional infliction of emotional distress cause of action insufficient based on the
defendant’s alleged failure to “quickly” grant loan modification under HAMP after
representing to the plaintiff it would do so if he complied with certain requirements]; see
also In re Jenkins (Bankr. E.D.Tenn. 2013) 488 B.R. 601, 617 [lender’s institution of
foreclosure during consideration of HAMP modification request and while TPP in place
not so extreme as to support intentional infliction of emotional distress cause of action
under Tennessee law].)
The conduct in all of these cases essentially mirrors that on which plaintiffs
rely, i.e., statutory violations when defendant continued the foreclosure action while it
delayed considering plaintiffs’ request for a HAMP loan modification. This does not
measure up to the “high bar” required to plead a cause of action for intentional infliction
of emotional distress, even taken with the allegation defendant knew plaintiffs were
senior citizens. Plaintiffs have not suggested any allegations they could add were we to
give leave to amend.

6. Breach of Contract and the Implied Covenant of Good Faith and Fair Dealing
Plaintiffs allege that when they sought a loan modification from defendant,
its representatives “orally promised” them that if they provided the Initial Package,
defendant would consider a modification under HAMP. Defendant breached by “failing
to comply with HAMP standard industry practices” by “ignoring” plaintiffs’ application
for modification and failing to “make a ‘reasonable effort’ to” offer a TPP to plaintiffs
within 30 days of receiving the Initial Package or send a denial letter, but instead
continuing to ask for additional documents, including some plaintiffs had already
provided. Defendant also “repudiated the contract” when it denied the modification
because, after review of the request under the HAMP guidelines, it determined plaintiffs

16
did not qualify.5 Plaintiffs allege this was a “positive[] indicat[ion]” defendant would
repudiate its contract.
Plaintiffs maintain that due to defendant’s breach they did not receive the
benefit of their bargain and were damaged by the threat of foreclosure and a cloud on
their title, among other things.
The elements of a breach of contract cause of action are: (1) the existence
of a contract; (2) plaintiffs’ performance or excuse of performance of their duties under
the contract; (3) defendant’s breach; and (4) plaintiffs’ damages. (First Commercial
Mortgage Co. v. Reece (2001) 89 Cal.App.4th 731, 745.) A valid contract requires,
among other things, valuable consideration. (ASP Properties Group, L.P. v. Fard, Inc.
(2005) 133 Cal.App.4th 1257, 1269.)
Further there is a duty of good faith and fair dealing implied in every
contract that a party will not perform any acts that will interfere with the other party’s
right to receive the benefits under the contract. (Barroso v. Ocwen Loan Servicing, LLC
(2012) 208 Cal.App.4th 1001, 1014.) A cause of action for breach of that covenant
requires the same allegations as a breach of contract claim except it must plead both an
implied promise and defendant’s unfair interference with plaintiffs’ right to receive the
fruits of the contract. (Yari v. Producers Guild of America (2008) 161 Cal.App.4th 172,
182.)
Plaintiffs’ causes of action have several deficiencies. But we need not
discuss most of them. As plaintiffs acknowledge, they did receive the benefit of the
bargain. Despite an alleged threat of foreclosure and a cloud on their title, their loan was
permanently modified. Thus, no sufficient breach is alleged and neither cause of action
can stand. Again, plaintiffs have not advised of, and we have not found, any basis to

5 Although plaintiffs did not allege it, the exhibit containing the denial also shows
that decision was to be disregarded and additional pay stubs from plaintiffs were to be
requested.

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amend the causes of action and the court’s order sustaining them without leave to amend
must stand.

7. Promissory Estoppel
The second amended complaint alleges defendant “made clear, definite and
certain promises to [p]laintiffs to induce them to enter into oral executed
agreements . . . .” Specifically, defendant promised to evaluate plaintiffs in good faith for
the possibility of a loan modification under HAMP if plaintiffs provided the Initial
Package, hold off on the foreclosure sale during the evaluation, and not conduct a
foreclosure sale at all. Due to these false promises, plaintiffs failed to “take legal action
against” defendant and suffered damages and personal injury. Plaintiffs allege failure to
enforce the promises would result in injustice.
The elements of a promissory estoppel claim are a clear and unambiguous
promise, reasonable and foreseeable reliance by the promisee, and injury to the promisee.
(Wells Fargo Bank, N.A. v. FSI Financial Solutions, Inc., supra, 196 Cal.App.4th at p.
1573.) “‘Estoppel cannot be established from . . . preliminary discussions and
negotiations.’ [Citation.]” (Garcia v. World Savings, FSB (2010) 183 Cal.App.4th 1031,
1044.)
This cause of action has several problems. But, as with the breach of
contract cause of action, and as plaintiffs acknowledge, defendant did evaluate their
application and offered them a TPP and ultimately a permanent loan modification.
Thus, this cause of action is also insufficient. Plaintiffs have not shown
how they could amend to cure these deficiencies, nor can we see a solution. In addition,
plaintiffs have had three chances to sufficiently allege this claim and have been unable to
do so. The demurrer as to this claim was properly sustained without leave to amend.

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8. Unfair Business Practices
The UCL prohibits an “unlawful, unfair or fraudulent business practice.”
Plaintiffs plead defendant’s violation of HAMP and state statutes are actionable under
that statutory scheme.
The only remedies available to private plaintiffs under the UCL are
injunctive relief and restitution. (Zhang v. Superior Court (2013) 57 Cal.4th 364.)
Neither damages nor attorney fees are recoverable. (Id. at p. 371.) “‘Restitution under
[Business and Professions Code] section 17203 is confined to restoration of any interest
in “money or property, real or personal, which may have been acquired by means of such
unfair competition.” . . . A restitution order against a defendant thus requires both that
money or property have been lost by a plaintiff, on the one hand, and that it have been
acquired by a defendant on the other.’ [Citation.]” (Ibid.)
Plaintiffs have not pleaded any facts showing they are entitled to restitution.
There are no allegations in the second amended complaint showing they have lost any
money or property that defendant then acquired. In their brief they merely state
defendant’s “conduct caused [them] injury and damages.”
As to injunctive relief, plaintiffs allege they are entitled to it but it is
unclear as to what they are seeking to enjoin, other than perhaps “any prospective
wrongful foreclosure.” Given that their loan has been permanently modified, any
possible foreclosure would not be based on plaintiffs’ prior default. Thus, there is no
ground for injunctive relief based on the events alleged in the second amended complaint.
This precludes any possibility of amending it.

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9. Cancellation of Foreclosure Documents, Quiet Title, and Slander of Title
a. Cancellation of Foreclosure Documents and Enjoining Foreclosure Sale
and Quiet Title
Mixed within several pages of legal argument, all of which we disregard as
improper, plaintiffs allege defendant violated sections 2923, 2923.5, 2924, 2924b, 2924f,
2924g, and 2934 because it failed to: (1) contact plaintiffs to discuss options to avoid
foreclosure and then wait 30 days before it recorded a notice of default; (2) timely mail
the required number of copies of the notice of default to plaintiffs; (3) post the notice of
default; (4) mail and post a notice to the resident of the property; (5) conduct the
foreclosure sale within one year from the date stated in the notice of sale; and (6) ensure
Quality had the proper authority to act as trustee and record a valid substation of trustee.
Plaintiffs plead there can be no valid foreclosure sale as a result of these violations and
ask the court to cancel the foreclosure notices and enjoin sale.
Both of these causes of action are moot because plaintiffs’ loan has been
permanently modified, foreclosure is not pending, and defendant is not disputing title.

b. Slander of Title
Plaintiffs make no argument as to this cause of action and thus they have
waived their claim. (Evans v. CenterStone Development Co. (2005) 134 Cal.App.4th
151, 165 [failure to make reasoned argument forfeits the issue].)

10. Miscellaneous
To the extent plaintiffs raise any other issues not clearly set out in headings
and supported by reasoned legal argument, they are forfeited. (Benach v. County of Los
Angeles (2007) 149 Cal.App.4th 836, 852.)

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 DISPOSITION

The judgment is affirmed. Defendant is entitled to costs on appeal.

THOMPSON, J.

WE CONCUR:

RYLAARSDAM, ACTING P. J.

MOORE, J.

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