Filed 5/27/15 Parker v. Wells Fargo Home Mortgage CA2/5
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication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 FIVE
ERWIN L. PARKER et al., B254343
Plaintiffs and Appellants, (Los Angeles County
Super. Ct. No. VC063213)
v.
WELLS FARGO HOME MORTGAGE,
INC., etc.,
Defendant and Respondent.
APPEAL from an order of the Superior Court of the County of Los Angeles,
Margaret M. Bernal, Judge. Affirmed.
Erwin L. Parker, Deborah Brown Parker, in pro. pers., for Plaintiffs and
Appellants.
Anglin Flewelling Rasmussen Campbell & Trytten, Robert Collings Little, Robin
C. Campbell for Defendant and Respondent.
INTRODUCTION
Plaintiffs and appellants Erwin L. Parker and Deborah Brown-Parker (plaintiffs)
appeal from judgment of dismissal after an order sustaining a demurrer to their complaint
without leave to amend in favor of defendant and respondent Wells Fargo Home
Mortgage (defendant). Plaintiffs contend that the trial court erred in sustaining the
demurrer, concluding that plaintiffs’ lawsuit was barred by the doctrine of res judicata
and was preempted by the Home Owners’ Loan Act (12 U.S.C. §§ 1461 et seq.) (HOLA).
We affirm.
BACKGROUND
Plaintiffs owned real property located in Lakewood, California (the Property)
pursuant to a grant deed giving them title as “husband and wife, as joint tenants.”
Plaintiffs, as “husband and wife,” borrowed $850,000.00 from defendant’s predecessor,
Wachovia Mortgage, FSB (Wachovia), and executed an adjustable rate mortgage loan
(the Loan). Plaintiffs, as “HUSBAND AND WIFE,” secured the Loan with a deed of
trust on the Property, in favor of Wachovia and “its successors and/or assignees.”
Wachovia merged with defendant, and according to defendant Wachovia became a
division of defendant. Plaintiffs made payments on the Loan, but they ultimately stopped
doing so. According to the United States bankruptcy court docket, Mr. Parker, who was
represented by counsel, filed for Chapter 13 bankruptcy protection, and that proceeding
was voluntarily converted to a Chapter 7 bankruptcy proceeding. Defendant moved for
relief from the automatic stay in bankruptcy, and the bankruptcy court granted the
motion. Mr. Parker received a Chapter 7 discharge and his bankruptcy case was closed.
While defendant’s motion for relief from the automatic stay was pending in Mr.
Parker’s bankruptcy proceeding, Ms. Brown-Parker, through the same counsel that
represented Mr. Parker in his bankruptcy proceeding, filed a complaint against, inter alia,
Wachovia, as a division of defendant (first lawsuit). Ms. Brown-Parker subsequently
filed a 20 page first amended complaint (FAC) against, inter alia, defendant.
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Ms. Brown-Parker alleged nine causes of action in the FAC: fraud,
misrepresentation, unfair business practices, breach of contract as a third party
beneficiary, breach of the covenant of good faith and fair dealing, violation of Civil Code
section 2923.6, to remove cloud on title, declaratory relief, and lack of standing to
foreclose. In each of Ms. Brown-Parker’s causes of action, except her cause of action in
which she requested that the trial court find that defendant “lack[s] standing to pursue any
trustee sale or any other process against the Property,” she sought to enjoin defendant
from foreclosing on the Property.
In Ms. Brown-Parker’s fraud cause of action, she alleged that defendant “directed
her to stop making payments [on the Loan], claiming that only when she was behind in
payments would she receive attention and be considered for a loan modification.”
According to Ms. Brown-Parker, this representation was false because “she was eligible
while current on her loan.” Ms. Brown-Parker alleged that she “was never late on a
single payment until the representations of [defendant].” In Ms. Brown-Parker’s
misrepresentation cause of action, she alleged defendant misrepresented to her “that as
long as she was engaged in the loan modification process, that her home would not be
foreclosed upon,” and “that the foreclosure process would be stopped until a final
decision was made on her loan modification request.”
In Ms. Brown-Parker’s unfair business practices cause of action, she alleged that
the “fraud and misrepresentation of [defendant] . . . mentioned in this [FAC] constitute
unfair or fraudulent business acts and practices within the meaning of California Business
and Professions Code Section 17200 et seq.” In Ms. Brown-Parker’s breach of contract
as a third party beneficiary cause of action, she alleged that defendant “executed a formal
participation agreement and has agreed to comply with the terms and conditions of the
Making Home Affordable Program,” and that she was “a Third Party Beneficiary of that
written contract.” Ms. Brown-Parker alleged that defendant breached that contract by
failing to negotiate in good faith regarding, and refusing to enter into, a permanent loan
modification.
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In Ms. Brown-Parker’s breach of the covenant of good faith and fair dealing cause
of action, she alleged that “implied in every contract” is a covenant of good faith and fair
dealing. Ms. Brown-Parker alleged that defendant intentionally hid from her “the fact
that [defendant was] engaged in the business of issuing loans to unsuspecting
homeowners who could not afford the monthly payments, and whom they knew of should
have know[n] would have a high percentage of foreclosures. [Defendant was] obligated
to inform [her] of this information and intentionally failed to do so, breaching the implied
covenant of good faith and fair dealing.”
In Ms. Brown-Parker’s cause of action for violation of Civil Code section 2923.6,
she alleged that defendant violated that statue “by repeatedly failing and refusing to offer
[her] a permanent loan modification, despite the legal obligation to do so.” In Ms.
Brown-Parker’s cause of action to remove cloud on title, she alleged that defendant’s
claim that it holds title to a deed of trust recorded against the Property is invalid because
“the deed of trust through which [defendant] claim[s title] is invalid and
unenforceable. [¶] [Ms. Brown-Parker] seeks a determination that the deed of trust is
void. She seeks a declaration that . . . [defendant] be declared to have no estate, right,
title or interest in [the Property] through the invalid deed of trust . . . .”
In Ms. Brown-Parker’s declaratory relief cause of action, she sought a “declaration
as to the validity of the loan agreement, loan transactions, and [defendant’s] right to
proceed with a Trustee Sale of the Property.” In that cause of action, she “contends that
the loan agreement is void based on defendant[’s] fraud,” and as a “further contention”
that “[defendant] failed to provide [her] with full disclosure of the terms of the note[],
[and] the assignment, servicing, and securitization of the loan . . . resulting in [her] being
bound to the extraordinary high interest rates that [she] cannot afford, and to an
‘adjustable’ rate mortgage that never adjusts downward with decreases in the interest
rate.”
In Ms. Brown-Parker’s cause of action regarding the lack of standing to foreclose,
she alleged that defendant “failed and refused to produce any note signed by [her] or any
other document evidencing any ownership on their part of a note or trust deed on the
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property,” and therefore, “[defendant has] no ownership interest in a note or trust deed
secured by [the Property].” Ms. Brown-Parker alleged that as a result, defendant “lack[s]
standing to commence a foreclosure on [the Property] or to instruct . . . [a] Trustee . . . to
commence or prosecute a foreclosure through Trustee’s sale.”
Ms. Brown-Parker sought as relief (1) compensatory damages; (2) punitive
damages; (3) issuance of preliminary and permanent injunction preventing defendant
from foreclosing on the Property; (4) an order removing the deed of trust as a cloud on
title; (5) a declaration that defendant has no interest in the Property; (6) attorney fees; and
(7) such other and further relief as the trial court may deem just and proper.
Defendant demurred to the FAC. The trial court sustained the demurrer without
leave to amend, stating, inter alia, that Ms. Brown-Parker’s “claims regarding the loan
origination process,” including “nondisclosures and misrepresentations regarding
mortgage loans,” were preempted by HOLA; defendant did not owe Ms. Brown-Parker a
duty to verify her ability to repay the Loan; defendant did not owe Ms. Brown-Parker a
duty to modify the Loan; Ms. Brown-Parker cannot quiet title to the Property because she
did not pay the secured debt; the declaratory relief cause of action failed because the
breach of an obligation, if any, had already occurred; and defendant was not required to
possess the original promissory note. The trial court dismissed defendant from the first
lawsuit. There is no evidence in the record that Ms. Brown-Parker appealed from the
trial court’s order of dismissal.
A notice of default and election to sell under deed of trust was recorded, and
shortly thereafter, a notice of trustee’s sale was recorded. About six months after the trial
court dismissed defendant from the first lawsuit, and about one month after notice of
trustee’s sale was recorded, plaintiffs, acting in propria persona, filed a 23 page verified
complaint, exclusive of attachments, against, inter alia, defendant, alleging two causes of
action: rescission and cancellation of written instruments (second lawsuit). Plaintiffs
sought “Preliminary and Permanent Injunctive Relief and Quiet title of [the Property]
against Defendants . . . claiming any legal or equitable right, title, estate, lien, or interest
in [the Property] adverse to [plaintiffs’] title . . . .” Plaintiffs alleged, inter alia, that the
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Loan and deed of trust were void because defendant assumed the liabilities of Wachovia,
“no agent of [Wachovia] ever countersigned [the Loan],” and Wachovia “did not disclose
[to plaintiffs] all the material facts in the alleged agreements.” Plaintiffs alleged that
Wachovia also failed to disclose that the “mortgage transactions were, in fact, not
‘Loans’ of [Wachovia’s] assets, but some sort of investment transaction scheme using the
Uniform Commercial Code that allowed [Wachovia] the ability to create profits on their
books and to be unjustly enriched at the expense of [plaintiffs].”
In plaintiffs’ recession cause of action, they allege that they “are entitled to rescind
[the deed of trust and the Loan] and recover their consideration paid thereunder because
their consent to the purported agreements was given by mistake, and/or obtained through
fraud exercised by the Defendants, and/or the consideration promised by Defendants
failed in a material respect[,] and through the fault of Defendants[,] Plaintiffs have not
received any consideration from [defendant].” In plaintiffs’ cancellation of written
instruments cause of action, they seek to have the Loan and deed of trust cancelled
claiming that they were fraudulently induced to execute them, defendant made material
misrepresentations and concealed material facts, and as to the Loan, there was failure of
consideration as to it.
Plaintiffs sought as relief (1) a judgment that defendant has no interest in the
Property; (2) the deed of trust and the promissory note be cancelled and declared void;
(3) defendant deliver the deed of trust and promissory note to the clerk of the court for
cancellation; (4) restitution of the sum of $74,479.02, which was the amount plaintiffs
paid on the promissory note; (5) $223,437.06 in damages in the event defendant fails to
surrender the deed of trust and promissory note to the clerk of the court for cancellation;
(6) punitive damages; (7) a declaration that the “Mortgage Transactions” and promissory
note have been rescinded; (8) permanent injunctive relief against defendant; (9) for an
order quieting title to the Property; (10) costs of suit; and (11) such other and further
relief as the trial court may deem just and proper.
Defendant demurred to the complaint in the second lawsuit on the grounds that,
inter alia, the complaint was barred by the doctrine of res judicata and preempted by
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HOLA. Defendant filed a request for judicial notice of several documents, including
documents from the first lawsuit: the FAC, notice of the trial court’s ruling on
defendant’s demurrer to the FAC, and notice of entry of judgment or order.
At the hearing on the demurrer, defendant appeared telephonically and plaintiffs
did not appear. Defendant “submit[ed] without a hearing.” The trial court granted
defendant’s request for judicial notice, and sustained defendant’s demurrer, stating,
“Based on these documents [submitted with the request for judicial notice], it is apparent
that this is Plaintiffs’ second attempt at halting foreclosure of their real property, located
in Lakewood. Defendant’s demurrer to the prior action . . . was sustained without leave
to amend on September 18, 2012. The current pleading appears to be an improper
attempt at an end-run around that judgment. [¶] Demurrer is sustained without leave to
amend on the basis that it is barred by res judicata. This is true even though Mr. Parker
was not a party to the prior action because he was in privity with Ms. Brown-Parker, and
even though the claims asserted here are slightly different, because res judicata bars any
claims that could have been raised in the prior action. Villacres v. ABM Industries, Inc.
(2010) 189 Cal.App.4th 562, 576. [¶] Plaintiff[s’] pleading is confusing but appears to
allege that no actual loan occurred. However, the documents of which the Court has
taken judicial notice evidence an $850,000 loan secured by a Deed of Trust. Plaintiffs
pray for judgment cancelling the deed of trust and promissory note. To the extent the
Court understands Plaintiffs’ allegations, they are legally defective in that they are
preempted by HOLA [the Home Owners’ Loan Act, 12 U.S.C. § 1461 et seq.]. Weiss v.
Washington Mutual Bank (2007) 147 Cal.App.4th 72, 77.”
DISCUSSION
A. Adequate Record
Plaintiffs did not include in the record the reporter’s transcript of the hearing on
the demurrer. California Rules of Court, rule 8.120(b) requires a reporter’s transcript on
appeal only if “an appellant intends to raise any issue that requires consideration of the
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oral proceedings in the superior court . . . .” California Rules of Court, rule 8.130(a)(4)
provides that an appellant may “elect[] to proceed without a reporter’s transcript.” We
therefore requested the parties to brief whether plaintiffs’ failure to provide a reporter’s
transcript or a suitable substitute warrants affirmance based on the inadequacy of the
record. (Maria P. v. Riles (1987) 43 Cal.3d 1281, 1295; In re Kathy P. (1979) 25 Cal.3d
91, 102.)
The record reflects that plaintiffs did not appear at the hearing on the demurrer,
and defendant “submit[ed] without a hearing.” Defendant concedes therefore that “the
Reporter’s Transcript would not likely, in this instance, contribute meaningfully to [our]
assessment of [plaintiffs’] claims of error.” Plaintiffs’ failure to include in the record the
reporter’s transcript of the hearing on the demurrer does not warrant affirmance of the
trial court’s ruling based on the inadequacy of the record.
Defendant contends that plaintiffs failed to provide an adequate record that we
have jurisdiction because it does not contain a judgment of dismissal. It is not necessary
that there be a judgment of dismissal. An “order sustaining the demurrer without leave to
amend is not appealable. The propriety of the trial court’s ruling [sustaining the demurrer
without leave to amend] is subject to review on appeal from the appealable order of
dismissal, however.” (Kong v. City of Hawaiian Gardens Redevelopment Agency (2002)
108 Cal.App.4th 1028, 1032, fn. 1.)
Plaintiffs have provided us with an April 2, 2014, order of dismissal, and we order
the record augmented with it. We have jurisdiction to entertain the appeal.
Defendant also contends that plaintiffs failed to provide an adequate record
because it does not contain defendant’s reply to plaintiffs’ opposition to the demurrer.
Plaintiffs designated that the record include defendant’s reply. We have obtained a copy
of defendant’s reply from the trial court’s records, and order the record augmented with
it.
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B. Res Judicata
Plaintiffs contend that the trial court erred in sustaining the demurrer on the
ground that their lawsuit was barred by the doctrine of res judicata. We disagree.
1. Standard of Review
We review de novo a judgment based on an order sustaining a demurrer.
(Committee for Green Foothills v. Santa Clara County Bd. of Supervisors (2010) 48
Cal.4th 32, 42; Siliga v. Mortgage Electronic Registration Systems, Inc. (2013) 219
Cal.App.4th 75, 81.) “As the Supreme Court has observed, ‘In reviewing the sufficiency
of a complaint against a general demurrer, we are guided by long-settled rules. “We treat
the demurrer as admitting all material facts properly pleaded, but not contentions,
deductions or conclusions of fact or law. [Citation.] We also consider matters which
may be judicially noticed.” [Citation.] Further, we give the complaint a reasonable
interpretation, reading it as a whole and its parts in their context. [Citation.] When a
demurrer is sustained, we determine whether the complaint states facts sufficient to
constitute a cause of action. [Citation.] And when it is sustained without leave to amend,
we decide whether there is a reasonable possibility that the defect can be cured by
amendment: if it can be, the trial court has abused its discretion and we reverse; if not,
there has been no abuse of discretion and we affirm. [Citations.] The burden of proving
such reasonable possibility is squarely on the plaintiff. [Citation.]’ [Citation.]” (Los
Angeles Memorial Coliseum Commission v. Insomniac, Inc. (2015) 233 Cal.App.4th 803,
819.)
Res judicata is a defense that may be raised by demurrer. (Code Civ. Proc., §
430.30, subd. (a); Estate of Dito (2011) 198 Cal.App.4th 791, 795.) Whether res judicata
applies is a question of law, which we review de novo. (Louie v. BFS Retail &
Commercial Operations, LLC (2009) 178 Cal.App.4th 1544, 1553; Nicholson v. Fazeli
(2003) 113 Cal.App.4th 1091, 1100.)
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2. Applicable Law
Our Supreme Court stated, “‘Res judicata’ describes the preclusive effect of a final
judgment on the merits. Res judicata, or claim preclusion, prevents relitigation of the
same cause of action in a second suit between the same parties or parties in privity with
them. . . . Under the doctrine of res judicata, if a plaintiff prevails in an action, the cause
is merged into the judgment and may not be asserted in a subsequent lawsuit; a judgment
for the defendant serves as a bar to further litigation of the same cause of action.”
(Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 896-897, fn. omitted; see also
Citizens Planning Assn. v. City of Santa Barbara (2011) 191 Cal.App.4th 1541, 1549;
Code Civ. Proc., § 1908, subd. (a)(2).)1
Res judicata applies if (1) the judgment in the prior proceeding is final and on the
merits; (2) the present proceeding is on the same cause of action as the prior proceeding;
and (3) the parties in the present proceeding or parties in privity with them were parties in
the prior proceeding. (In re Anthony H. (2005) 129 Cal.App.4th 495, 503; Federation of
Hillside & Canyon Assns. v. City of Los Angeles (2004) 126 Cal.App.4th 1180, 1202; see
Busick v. Workmen’s Comp. Appeals Bd. (1972) 7 Cal.3d 967, 972; Bernhard v. Bank of
America (1942) 19 Cal.2d 807, 810-811.)
For purposes of res judicata, the term “cause of action” refers neither to the legal
theory asserted by a plaintiff nor to the remedy the plaintiff seeks. (Mycogen Corp. v.
Monsanto Co., supra, 28 Cal.4th at p. 904; Slater v. Blackwood (1975) 15 Cal.3d 791,
795-796.) Instead, “California has consistently applied the ‘primary rights’ theory, under
1
“‘The doctrine of collateral estoppel is one aspect of the concept of res judicata.
In modern usage, however, the two terms have distinct meanings.’ [Citation.]”
(Mycogen Corp. v. Monsanto Co., supra, 28 Cal.4th at pp. 896-897, fn. 7.) In contrast to
the doctrine of res judicata, the doctrine of “collateral estoppel, or issue preclusion,
‘precludes relitigation of issues argued and decided in prior proceedings.’ [Citation.]”
(Id. at p. 896.) Under the doctrine of collateral estoppel, “‘“The first action is not a
complete merger or bar, but operates as an estoppel or conclusive adjudication as to such
issues in the second action which were actually litigated and determined in the first
action. [Citation.]” [Citation.]’ [Citation.]” (Murray v. Alaska Airlines, Inc. (2010) 50
Cal.4th 860, 866-867.)
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which the invasion of one primary right gives rise to a single cause of action.” (Slater v.
Blackwood, supra, 15 Cal.3d at p. 795.) The primary right theory “provides that a ‘cause
of action’ is comprised of a ‘primary right’ of the plaintiff, a corresponding ‘primary
duty’ of the defendant, and a wrongful act by the defendant constituting a breach of that
duty. [Citation.] The most salient characteristic of a primary right is that it is indivisible:
the violation of a single primary right gives rise to but a single cause of action.
[Citation.] . . . [¶] As far as its content is concerned, the primary right is simply the
plaintiff’s right to be free from the particular injury suffered. [Citation.]” (Crowley v.
Katleman (1994) 8 Cal.4th 666, 681; accord, Grisham v. Philip Morris U.S.A., Inc.
(2007) 40 Cal.4th 623, 641; Boyce v. T.D. Service Co. (2015) 235 Cal.App.4th 429, 435-
436.) A particular injury might be compensable under multiple legal theories and might
entitle a party to several forms of relief; nevertheless, it will give rise to only one cause of
action. (Crowley v. Katleman, supra, 8 Cal.4th at pp. 681-682.)
3. Analysis
“The fact that the [judgment in the prior action] resulted from the sustaining of a
general demurrer does not preclude application of the res judicata doctrine.” (Pollock v.
University of Southern California (2003) 112 Cal.App.4th 1416, 1427-1428.) “Res
judicata applies only if there is a decision on the merits.” (Maddern v. Superior Court
(1972) 22 Cal.App.3d 998, 1004.) A demurrer is “a method of deciding the merits of the
cause of action on assumed facts without a trial. [Citation.]” (Linder v. Thrifty Oil Co.
(2000) 23 Cal.4th 429, 437, fn. 4.) “A judgment given after the sustaining of a general
demurrer on a ground of substance, . . . may be deemed a judgment on the merits, and
conclusive in a subsequent suit . . . .” (Goddard v. Security Title Ins. & Guar. Co. (1939)
14 Cal.2d 47, 52; Shuffer v. Board of Trustees (1977) 67 Cal.App.3d 208, 216 [the res
judicata doctrine “may apply to a final judgment, i.e., a dismissal, even though entered
after sustaining a demurrer, if the demurrer was sustained on substantive grounds”].)
Plaintiffs do not dispute that the judgment in the first lawsuit is final, and there is
no evidence in the record that Ms. Brown-Parker appealed from the trial court’s order of
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dismissal in that lawsuit. Plaintiffs also do not dispute that Mr. Parker was in privity with
his wife, Ms. Brown-Parker, in connection with Ms. Brown-Parker’s prior lawsuit.
“Privity refers to a relationship . . . ‘sufficiently close’ so as to justify applying
collateral estoppel. [Citation.]” (Mueller v. J.C. Penney Co. (1985) 173 Cal.App.3d 713,
723.) “In the context of a res judicata determination, privity ‘“refers ‘to a mutual or
successive relationship to the same rights of property, or to such an identification in
interest of one person with another as to represent the same legal rights [citations] and,
more recently, to a relationship between the party to be estopped and the unsuccessful
party in the prior litigation which is “sufficiently close” so as to justify application of the
doctrine of collateral estoppel.’”’ [Citation.] ‘“[T]he determination of privity depends
upon the fairness of binding appellant with the result obtained in earlier proceedings in
which it did not participate. [Citation.] ‘“Whether someone is in privity with the actual
parties requires close examination of the circumstances of each case.”’”’ [Citation.]”
(Consumer Advocacy Group, Inc. v. ExxonMobil Corp. (2008) 168 Cal.App.4th 675, 689-
690.) “Under California law, spouses are in privity with each other where the cause of
action in the prior litigation was ‘community in nature’ and the ‘proceeds of any
judgment that might have been recovered . . . would have belonged to both husband and
wife, as community property.’ [Citations.]” (Mueller v. J.C. Penney Co., supra, 173
Cal.App.3d at p. 723.) Plaintiffs held title to the Property pursuant to a grant deed as
“husband and wife, as joint tenants.” There is a rebuttable presumption that “property
acquired during marriage by either spouse, other than by gift or inheritance, is
community property.” (In re Marriage of Weaver (2005) 127 Cal.App.4th 858, 864.)
Plaintiffs, as “husband and wife,” executed the Loan, and executed the deed of
trust on the Property securing the Loan. While defendant’s motion for relief from the
automatic stay was pending in Mr. Parker’s bankruptcy proceeding, Ms. Brown-Parker
commenced the first lawsuit, seeking to prevent defendant from foreclosing on the
Property. The same counsel that represented Mr. Parker in his bankruptcy proceeding,
represented Ms. Brown-Parker in the first lawsuit. Mr. Parker and Ms. Brown-Parker
were joint obligors on the note and jointly owned the Property, and had the identical
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interests in the subject lawsuit. They were married and lived together on the Property.
Mr. Parker was in privity with Ms. Brown-Parker regarding the first lawsuit. They both
filed the second lawsuit. Mr. Parker’s relationship with his wife was “sufficiently close”
so as to justify application of the doctrine of res judicata and collateral estoppel. (Mueller
v. J.C. Penney Co., supra, 173 Cal.App.3d at p. 723.)
Plaintiffs contend that their claims of rescission and cancellation of written
instruments alleged in the second lawsuit were not litigated in the first lawsuit. Under the
“primary rights” theory, however, plaintiffs had but one cause of action; plaintiffs’
primary right in both lawsuits was to be free from a nonjudicial foreclosure of their
property pledged to secure the Loan obligation. In the first lawsuit, Ms. Brown-Parker
sought to enjoin defendant from foreclosing on the Property, a determination that the
deed of trust is void, and a declaration that defendant have no interest in the Property
through the deed of trust and of “the validity of the loan agreement, loan transactions, and
[defendant’s] right to proceed with a Trustee Sale of the Property.” Ms. Brown-Parker
also claimed that defendant lacked standing to commence or prosecute a foreclosure
through a trustee’s sale. In the second lawsuit, plaintiffs sought to enjoin defendant from
claiming any lien or interest in the Property; rescind the Loan and deed of trust; have the
Loan and deed of trust cancelled; and obtain a judgment that defendant had no interest in
the Property.
“[U]nder [the doctrine of res judicata], all claims based on the same cause of
action must be decided in a single suit; if not brought initially, they may not be raised at a
later date. ‘“Res judicata precludes piecemeal litigation by splitting a single cause of
action or relitigation of the same cause of action on a different legal theory or for
different relief.”’ [Citation.]” (Mycogen Corp., supra, 28 Cal.4th at p. 897.) “The law is
settled that a ‘prior final judgment on the merits not only settles issues that were not
actually litigated but also every issue that might have been raised and litigated in the first
action.’ (Mattson v. City of Costa Mesa (1980) 106 Cal.App.3d 441, 446 [164 Cal.Rptr.
913].) When a matter is within the ‘“‘“scope of the [prior] action, related to the subject
matter and relevant to the issues, so that it could have been raised, the judgment is
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conclusive on it . . . . Hence the rule is that the prior judgment is res judicata on matters
which were raised or could have been raised, on matters litigated or litigable.”’”’
(Villacres v. ABM Industries Inc.[, supra,] 189 Cal.App.4th [at p.] 576 . . . , citation
omitted.)” (Federal Home Loan Bank of San Francisco v. Countrywide Financial Corp.
(2013) 214 Cal.App.4th 1520, 1529.) Plaintiffs’ lawsuit was barred by the doctrine of res
judicata.
C. Other Contention
Because we affirm the judgment based on res judicata principles, we do not reach
plaintiffs’ contention that the FAC was not preempted by HOLA.
DISPOSITION
The judgment is affirmed. Defendant is awarded its costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
MOSK, J.
We concur:
TURNER, P. J.
KRIEGLER, J
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