Rezapour v. U.S. Bank Nat. Assn. CA1/3

Filed 12/30/21 Rezapour v. U.S. Bank Nat. Assn. CA1/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or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

FIRST APPELLATE DISTRICT

DIVISION THREE

ARI REZAPOUR et al.,
Plaintiffs and Appellants,
A155505, A156855
v.
U.S. BANK NATIONAL (Contra Costa County
ASSOCIATION et al., Super. Ct. No. MSC1702246)
Defendants and Respondents.

In this consolidated appeal, plaintiffs Ari and Aurora Rezapour appeal
from a judgment in favor of defendants U.S. Bank N.A., as Trustee for Banc
of America Funding Corporation Mortgage Pass-Through Certificate Series
2007-7 (U.S. Bank), Nationstar Mortgage LLC (Nationstar), and Specialized
Loan Servicing LLC (SLS), and from a postjudgment order granting SLS’s
motion for attorney fees. Plaintiffs filed this lawsuit to preempt a nonjudicial
foreclosure sale of their home by alleging that the foreclosing entity lacked
the authority to proceed with the sale. The trial court sustained demurrers
to plaintiffs’ second amended complaint without leave to amend on the
ground that plaintiffs lacked standing to challenge the foreclosing entity’s
authority because their allegations of “forgery,” even if true, would only
render the assignment of the note and deed of trust voidable at the injured

1
party’s option, not void. In awarding attorney fees to SLS, the court found
that although SLS was not a signatory to the promissory note and deed of
trust containing the attorney fee clauses, it was entitled to fees because it
“ ‘stood in the shoes’ ” of the loan beneficiary. We affirm the judgment but
reverse the order awarding SLS its attorney fees.
FACTUAL AND PROCEDURAL BACKGROUND
We take the following factual allegations from the complaint.
Plaintiffs are the owners of property located in Lafayette (the property).
They purchased the property in 2007 after obtaining a purchase money
mortgage from Bank of America, N.A. (BofA) in the amount of $1.46 million.
The mortgage was secured by a deed of trust on the property. According to
the complaint, plaintiffs “still currently reside” at the property.
The complaint alleges a conspiracy among defendants and various
individuals to deprive plaintiffs of the protections of California nonjudicial
foreclosure law. Specifically, plaintiffs allege that in August 2012, one Loryn
Stone, falsely holding herself out as an “Assistant Vice President” at BofA,
“forged” a substitution of trustee naming Recon Trust Company as
foreclosure trustee, and then “forged” an assignment of the deed of trust from
BofA to defendant U.S. Bank. Stone also recorded a notice of default on the
property.
Plaintiffs further allege a long series of additional transactions
beginning in March 2014, when Robin Mathews, falsely holding herself out as
a “Vice President” of defendant SLS, attorney-in-fact for BofA, executed and
recorded a corrective assignment of the deed of trust from BofA to U.S. Bank.
SLS then transferred servicing of the loan to defendant Nationstar, and Jorge
Valadez, falsely holding himself out as a “Vice President” of Nationstar,
executed and recorded a substitution of trustee in favor of Veriprise, which

2
recorded a notice of default on the property. More than a year later in
December 2016, Dustin Chmeilewski, falsely holding himself out as an
“Assistant Secretary” of U.S. Bank, recorded a substitution of trustee naming
Les Zieve as foreclosure trustee, and Zieve recorded yet another notice of
default on the property. In March 2017, another substitution of trustee was
recorded, this time by Carol Davis allegedly on behalf of Nationstar, naming
Clear Recon Corporation as foreclosure trustee. Davis “never had any lawful
or corporate authority to execute this substitution.” Clear Recon Corporation
recorded another notice of default, and in October 2017, a notice of trustee
sale of the property.
In short, plaintiffs allege that “[t]he notice of trustee sale and the
substitutions and the notices of default and the assignments [of the deed of
trust] since 2012 are void and invalid due to the fact that Loryn Stone, Robin
Mathews, Jorge Valadez, Dustin Chmeilewski, [and] Carol Davis, did not
have the lawful authority to execute the documents they did.” Thus, “[a]s a
result of these fraudulent and forged assignments, defendants, and none of
them, have the lawful nor legal right to foreclose upon the property.”
The complaint asserts causes of action against defendants for
(1) declaratory judgment; (2) violation of statutes (Civ. Code, §§ 2924,
subd. (a)(6), 2924.17, & 1227); (3) “unlawful and attempted foreclosure”;
(4) cancellation of recorded instruments; (5) unfair business practices under
the Unfair Competition Law (Bus. & Prof. Code, § 17200 (UCL)); and
(6) slander of title.
SLS and U.S. Bank each generally demurred to the complaint. The
trial court tentatively ruled that plaintiffs failed to state sufficient facts to
constitute a cause of action because under Yvanova v. New Century Mortgage
Corp. (2016) 62 Cal.4th 919 (Yvanova), a borrower only has standing to

3
challenge the validity of a loan assignment that is void, not merely voidable,
and plaintiffs’ forgery allegations did not support the conclusion that the
assignments of the deed of trust were void. The court additionally found that
plaintiffs failed to allege (1) tender of the amounts due under the loan;
(2) economic harm caused by defendants’ conduct for purposes of the UCL
claim; and (3) malice to overcome the common interest privilege of Civil Code
section 47[, subdivision (c)], for purposes of the slander of title claim. After a
hearing on the demurrer, the court adopted its tentative ruling and entered
judgment in favor of defendants.
Thereafter, SLS moved for an award of attorney fees in the amount of
$31,215. SLS argued that as a prevailing party against plaintiffs, it was
contractually entitled to attorney fees under section 6(E) of the promissory
note and sections 9, 14, and 22 of the deed of trust, provisions that SLS could
assert despite being a nonsignatory because it “ ‘stood in the shoes’ ” of the
loan beneficiary, U.S. Bank. In support of the motion, SLS submitted the
declaration of Ami McKernan, second assistant vice president of SLS, who
averred that SLS acted as the loan servicer for the subject mortgage and that
plaintiffs were in default on the loan.
The trial court granted the motion, finding that “[b]oth the promissory
note and deed of trust executed by Plaintiffs contained provisions for an
award of attorney’s fees in all actions related to the loan,” and that although
SLS was not a signatory to the note and deed of trust, “it is undisputed that
[SLS] was the loan servicer. The Court finds as the loan servicer, [SLS]
‘stood in the shoes’ of the loan beneficiary.” The court further concluded that
the amount of fees sought by SLS was reasonable. Finally, the court
overruled plaintiffs’ objections to the McKernan declaration, and, in response

4
to SLS’s objections to the declaration of plaintiffs’ counsel, “considered said
declaration as argument and not evidence.”
Plaintiffs appealed from the judgment and the order granting SLS’s
motion for attorney fees.1 On our own motion, we consolidated the appeals
for purposes of argument and opinion.
DISCUSSION
A. Demurrer
On appeal from an order sustaining a general demurrer, we review the
complaint de novo to determine whether it alleges facts sufficient to state a
cause of action under any legal theory. (Cantu v. Resolution Trust Corp.
(1992) 4 Cal.App.4th 857, 879.) “ ‘ “We treat the demurrer as admitting all
material facts properly pleaded, but not contentions, deductions or
conclusions of fact or law.” ’ ” (Sanchez v. Truck Ins. Exchange (1994) 21
Cal.App.4th 1778, 1781.)
1. Borrower Standing in Wrongful Foreclosure Actions
The central issue raised in this appeal is whether plaintiffs have
standing preemptively to challenge U.S. Bank’s authority to foreclose on the
property based on allegations that certain foreclosure documents, including
the assignments of the deed of trust from BofA to U.S. Bank, were “forged.”
To state a claim for wrongful foreclosure generally, a plaintiff must allege
that the defendants caused an illegal, fraudulent, or willfully oppressive sale
of the property, the plaintiff suffered prejudice or harm, and the plaintiff
tendered or was excused from tendering the amount of the secured
indebtedness. (Chavez v. Indymac Mortgage Services (2013) 219 Cal.App.4th

1 The notice of appeal in case No. A155505 originally identified a
judgment in favor of “Select Portfolio Servicing,” but there was no party by
that name. After we requested clarification, plaintiffs amended the notice of
appeal to reflect SLS as respondent.

5
1052, 1062.) “Standing is a threshold issue necessary to maintain a cause of
action, and the burden to allege and establish standing lies with the
plaintiff.” (Mendoza v. JPMorgan Chase Bank, N.A. (2016) 6 Cal.App.5th
802, 809 (Mendoza).) In the foreclosure context, standing denotes “a
borrower’s legal authority to challenge the validity of an assignment.”
(Yvanova, supra, 62 Cal.4th at p. 928, fn. 3.)
In Gomes v. Countrywide Home Loans, Inc. (2011) 192 Cal.App.4th
1149, and Jenkins v. JPMorgan Chase Bank, N.A. (2013) 216 Cal.App.4th
497, disapproved in part in Yvanova, supra, 62 Cal.4th at p. 939, fn. 13, the
appellate courts held that under California’s comprehensive and exhaustive
statutory scheme for nonjudicial foreclosures, a borrower is not permitted to
bring a preemptive judicial action to challenge the right, power, and
authority of the foreclosing beneficiary or its agent to initiate and pursue
foreclosure. (Jenkins, at pp. 511–512; Gomes, at pp. 1154–1157.) As an
alternative basis for its decision, Jenkins further held that the plaintiff’s
allegation of an improper transfer of the assignment of the note and deed of
trust to an investment trust during the securitization process was insufficient
to withstand demurrer. (Jenkins, at pp. 513–515.) According to Jenkins, the
plaintiff was not the victim of the invalid transfer of the assignment of the
deed of trust, but was an unrelated third party, and she therefore lacked
standing to sue on the investment trust’s pooling and servicing agreement
relating to the transfer. (Ibid.)
In Yvanova, the Supreme Court disapproved of this latter portion of
Jenkins, concluding that a borrower has standing to maintain a postsale suit
for wrongful foreclosure if he or she alleges facts that, if true, would render
the assignment of the deed of trust to the foreclosing entity “void, and not
merely voidable at the behest of the parties to the assignment.” (Yvanova,

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supra, 62 Cal.4th at pp. 923, 934–939 & fn. 13.) As the court explained, if a
borrower alleges a void assignment of the deed of trust to the foreclosing
entity, the assignment has “no legal force or effect whatsoever [citation],
[and] the foreclosing entity has acted without legal authority by pursuing a
trustee’s sale.” (Id. at p. 935.) In this circumstance, the borrower is not
attempting to assert the rights of other parties to the agreement giving rise
to the assignment, but rather, is asserting its own right not to have its home
unlawfully foreclosed upon. (Id. at pp. 935–936.) Central to the decision in
Yvanova is the distinction between void and voidable assignments, as a void
transfer “cannot be ratified or validated by the parties to it even if they so
desire,” but “[w]hen an assignment is merely voidable, the power to ratify or
avoid the transaction lies solely with the parties to the assignment; the
transaction is not void unless and until one of the parties takes steps to make
it so.” (Id. at p. 936.)
Yvanova’s holding was a narrow one, as the court did not decide
whether or not the assignment of the deed of trust to an investment trust
after the trust’s closing date was void. (Yvanova, supra, 62 Cal.4th at
pp. 924, 925.) Furthermore, the scope of review in Yvanova did not extend to
the question of whether a preemptive wrongful foreclosure action is
permissible. (Yvanova, at pp. 924, 934 [“We do not hold or suggest that a
borrower may attempt to preempt a threatened nonjudicial foreclosure by a
suit questioning the foreclosing party’s right to proceed”].) Plaintiffs
nonetheless maintain that Yvanova’s recognition of borrower standing should
apply to their presale action. On-point authority is to the contrary (Saterbak
v. JPMorgan Chase Bank, N.A. (2016) 245 Cal.App.4th 808, 814–815

7
(Saterbak)),2 but even if we assume for the sake of argument that a
preforeclosure action alleging a void assignment of the deed of trust to the
foreclosing party is permissible, the question remains whether plaintiffs’
allegations of forgery support a claim that the challenged foreclosure
documents are void, rather than merely voidable at the injured party’s
option.
Several post-Yvanova decisions have rejected the theory that an
assignment of a deed of trust that was robosigned3 and/or forged was void,
concluding that such irregularities rendered the assignments merely voidable
at the option of the injured banks. (See Kalnoki v. First American Trustee
Servicing Solutions, LLC (2017) 8 Cal.App.5th 23, 46 (Kalnoki); Mendoza,
supra, 6 Cal.App.5th at pp. 819; Saterbak, supra, 245 Cal.App.4th at pp. 814–
815.) As plaintiffs point out, these cases did not meaningfully distinguish
between the practices of robosigning and forgery. While plaintiffs concede
that a robosignature renders an assignment merely voidable, they maintain
that a forged assignment is void ab initio, citing Wutzke v. Bill Reid Painting
Service, Inc. (1984) 151 Cal.App.3d 36 (Wutzke) and similar case authorities.
They further cite Century Bank v. St. Paul Fire & Marine Insurance Co.

2 Saterbak also rejected an argument raised by plaintiffs here that a
portion of paragraph 22 of the deed of trust requiring lenders to notify
borrowers of their “right to bring a court action to assert the non-existence of
a default or any other defense of Borrower to acceleration and sale” gives
plaintiffs standing to bring a presale action in court. As Saterbak held, such
“provisions do not change [the plaintiff’s] standing obligations under
California law.” (Saterbak, supra, 245 Cal.App.4th at p. 816.)
3 “The use of automated signatures” has been “colloquially referred to
as ‘robosigning.’ ” (Greenwald & Bank, Cal. Practice Guide: Real Property
Transactions (The Rutter Group 2018) ¶ 6:536:16.)

8
(1971) 4 Cal.3d 319 (Century Bank) for the proposition that someone who
executes a document without lawful authority commits forgery.
As a threshold matter, we disregard the complaint’s repeated uses of
the terms “forged” and “void ab initio,” as these are legal conclusions
insufficient to withstand demurrer. (Doe v. Roman Catholic Archbishop of
Los Angeles (2016) 247 Cal.App.4th 953, 960.) While we assume the truth of
the complaint’s factual allegations that Stone, Mathews, Chmeilewski,
Valadez, and Davis (hereafter the signatories) falsely asserted various job
titles in executing foreclosure-related documents, as we shall explain, these
allegations are insufficient to support the conclusion that the documents were
void.
A forgery is a “ ‘ “writing which falsely purports to be the writing of
another,” ’ and is executed with the intent to defraud.” (Schiavon v. Arnaudo
Brothers (2000) 84 Cal.App.4th 374, 382.) The Penal Code defines forgery as
requiring a signer’s knowledge that he or she lacks authority to sign the
name of another person, as well as intent to defraud. (Pen. Code, § 470.) In
Wutzke, supra, 151 Cal.App.3d 36, a deed of reconveyance was found to be
void because it met this legal definition of forgery. One of the borrowers
under a promissory note and deed of trust (Miller), executed and recorded a
fraudulent deed of reconveyance, signing “the fictitious names of Howard
Perry, as executive officer of [the trustee on the deed of trust], and Caroline
Wilson, notary.” (Wutzke, at p. 39.) Wutzke held that Miller’s signing of a
fictitious name on the deed of reconveyance rendered the document void
because it was a forgery within the meaning of Penal Code section 470. (Id.
at pp. 40–42.)
In so concluding, Wutzke distinguished People v. Bendit (1896) 111 Cal.
274, which held that a defendant who signed a bill of exchange in his own

9
name while falsely representing himself to be a collector for a business firm
did not commit forgery because “it is no false making of the instrument, but
merely a false assumption of authority.” ’ ” (Id. at pp. 277–278.) In contrast,
Wutkze highlighted that Miller “did not sign his own name but rather those of
two fictitious persons, thereby executing a document ‘which falsely purports
to be the writing of another.’ ” (Wutzke, supra, 151 Cal.App.3d at p. 42.)
Plaintiffs’ “forgery” allegations resemble Bendit, not Wutzke. They do
not allege that the signatories signed the foreclosure documents using the
names of other, or fictitious, persons. Nor do they allege that the signatures
as they appear in the challenged instruments are not those of the signatories.
Rather, as in Bendit, the allegations involve individuals signing their own
names but making false assertions of authority. Although plaintiffs allege in
a conclusory fashion that the signatories acted “fraudulently” and with the
“intent to defraud,” they fail to allege such fraud with particularity. (Cansino
v. Bank of America (2014) 224 Cal.App.4th 1462, 1469 [particularity
requirement for pleading fraud].) Critically, nowhere in the complaint do
plaintiffs allege that the signatories acted without the permission of the
entities on whose behalf they signed. Indeed, as to Mathews and
Chmeilewski, plaintiffs allege that these individuals executed the foreclosure
documents “at the direction of” the loan servicers, Nationstar and SLS.
Moreover, even if we indulged plaintiffs’ theory that the signatories
committed forgery, plaintiffs still fail to allege a void assignment because a
principal may ratify the forgery of its signature by an agent. (Rakestraw v.
Rodrigues (1972) 8 Cal.3d 67, 73–74 (Rakestraw); see Navrides v. Zurich Ins.
Co. (1971) 5 Cal.3d 698, 703–704 [principal may ratify agent’s unauthorized
act].) “[T]he ratification of an act of forgery by one held out to be a principal
creates an agency relationship between such person and the purported agent

10
and relieves the agent of civil liability to the principal which otherwise would
result from the fact that he acted independently and without authority.
(Rakestraw, at p. 74.) Thus, in Rakestraw, the forgery of a cross-
complainant’s name on a promissory note and deed of trust by her ex-
husband was ratified by the cross-complainant who, despite knowledge of the
fraud, did nothing for several years until an action was brought against her
to enforce the payment obligation. (Id. at pp. 71–72, 75.)
Accordingly, even if the signatories’ false assertions of job titles
constituted forgeries, these acts were capable of ratification by the entities on
whose behalf they falsely signed. Plaintiffs do not allege that any of the
parties to the allegedly forged instruments have stepped in to void them.
Thus, the complaint alleges, at best, irregularities that are voidable at the
option of the injured parties, and under Yvanova, plaintiffs lack standing to
assert those parties’ rights in order to challenge the foreclosing entity’s
authority to maintain the foreclosure proceedings. (Yvanova, supra, 62
Cal.4th at p. 936.)
Century Bank, supra, 4 Cal.3d 319 does not compel a different
conclusion, as that case involved the interpretation of a banker’s blanket
bond that insured against losses from loans made in reliance on
“ ‘counterfeited [or] forged’ ” instruments. (Id. at p. 320.) As an initial
matter, we question whether Century Bank has application outside the
context of interpreting an insurance policy. In concluding that the bond’s
forgery coverage applied where a security instrument was signed “by one who
had no authority to do so” (ibid.), Century Bank applied the maxim that the
meaning of an insurance policy must “be ascertained according to the
insured’s reasonable expectation of coverage, and all doubts as to the
meaning are to be resolved against the insurer.” (Id. at p. 321.) The court

11
thus construed the contract “in accord with the reasonable understanding of a
layman as to what constitutes forgery or counterfeiting, rather than in accord
with technical definitions and refinements of criminal statutes.” (Id. at
pp. 321–322.) But in any event, Century Bank went on to hold that “the
precise conduct which caused plaintiff’s loss in the present case falls within
the literal definition of forgery set forth in Penal Code section 470,” a
circumstance that distinguishes Century Bank from our case. (Century Bank,
supra, 4 Cal.3d at p. 322.)
In sum, because plaintiffs have not alleged a void assignment of the
deed of trust, but merely voidable irregularities in the foreclosure process,
they lack standing to challenge the foreclosing entity’s power to sell on these
grounds. (Kalnoki, supra, 8 Cal.App.5th at p. 46; Mendoza, supra,
6 Cal.App.5th at p. 819; Saterbak, supra, 245 Cal.App.4th at pp. 814–815.)
Thus, the trial court properly sustained the demurrer to the wrongful
foreclosure claim.
2. Remaining Causes of Action
The remaining causes of action fare no better, as they each duplicate
the wrongful foreclosure claim’s central allegation that the foreclosure
instruments were forged. The first cause of action seeks a declaratory
judgment that the assignments of the deed of trust, substitutions of trustees,
and notices of default and sale are void due to the alleged “fraud, lack of
authority, intent to defraud, and forgery.” The fourth cause of action seeks
cancellation of these instruments on the same grounds. The second cause of
action alleges violations of California nonjudicial foreclosure statutes “due to
the forgery” of Stone and Mathews. Likewise, the UCL claim “borrows” from
California nonjudicial foreclosure statutes as well as the Penal Code (Cel-
Tech Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20

12
Cal.4th 163, 180) to allege that defendants committed forgery, and the
slander of title claim alleges that the recording of “forged” documents
slandered plaintiffs’ title to their home. To the extent these claims seek
preemptively to challenge the foreclosing party’s authority to proceed with
the foreclosure sale, they fail as a matter of law for the reasons discussed.
(See Ratcliff Architects v. Vanir Construction Management, Inc. (2001) 88
Cal.App.4th 595, 607 [declaratory relief claim based on defective causes of
action also fails as matter of law]; Ingels v. Westwood One Broadcasting
Services, Inc. (2005) 129 Cal.App.4th 1050, 1060 [defendant cannot be liable
for unlawful business practices without having violated borrowed law].)
The slander of title claim fails for the additional reason that plaintiffs
fail to allege sufficient facts to overcome the common interest privilege of
Civil Code section 47, subdivision (c). Slander of title occurs when a person
publishes a false and unprivileged statement that disparages title to property
and causes the owner special pecuniary loss or damage. (Sumner Hill
Homeowners’ Assn., Inc. v. Rio Mesa Holdings, LLC (2012) 205 Cal.App.4th
999, 1030.) Importantly, the law “deems statutory nonjudicial foreclosure
procedures to be privileged communications under [Civil Code] section 47,”
which “provides a qualified privilege for communications made ‘without
malice, to a person interested therein, . . . by one who is also interested’
[citation], the so-called common interest privilege. For this purpose, malice is
defined as actual malice, meaning ‘ “that the publication was motivated by
hatred or ill will towards the plaintiff or by a showing that the defendant
lacked reasonable grounds for belief in the truth of the publication and
therefore acted in reckless disregard of the plaintiff’s rights.” ’ ” (Kachlon v.
Markowitz (2008) 168 Cal.App.4th 316, 336, italics omitted.) Here, the
complaint contains only conclusory statements that the foreclosure

13
instruments were not privileged and were recorded with malice. Plaintiffs
provide no argument or support that the demurring defendants’ malice can
be inferred from the allegations that the signatories held out false job titles in
the instruments they signed.
Instead, plaintiffs contend that the common interest privilege applies
only to the actions of the foreclosure trustee, not the demurring defendants.
We are not persuaded. Civil Code section 2924, subdivision (d), states in
relevant part that “privileged communications” pursuant to Civil Code
section 47 include the “[p]erformance of the procedures set forth in this
article.” The slander of title claim is based on the demurring defendants’ acts
of recording or causing to be recorded the notices of default, the assignments
of the deed of trust, and the substitutions of trustees, all of which constitute
procedures set forth in the same article as Civil Code section 2924—which
spans Civil Code sections 2920 to 2944.10. (See Civ. Code, §§ 2933.55
[recordation of notice of default], 2934 [recording of assignment of deed of
trust], 2934a [substitution of trustee].) Thus, the privilege applies to the
demurring defendants’ alleged conduct, and plaintiffs’ failure sufficiently to
allege malice provides an additional ground for sustaining the demurrer to
the slander of title claim.
For all of these reasons, we conclude the trial court properly sustained
the demurrers to the complaint in its entirety.
3. Leave to Amend
We last consider whether the trial court abused its discretion in
denying leave to amend. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) To
demonstrate that discretion was abused, plaintiffs have the burden of
showing a reasonable possibility that the pleading defects could be cured by
amendment. (Ibid.) Plaintiffs have not met their burden here.

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 Plaintiffs contend they were wrongfully denied leave to allege that SLS
admitted in discovery that Mathews was not its employee.4 This proposed
allegation would not cure the deficiency discussed above. Mathews’ lack of
employment with SLS does not mean she could not act as its agent (see
Gipson v. Davis Realty Co. (1963) 215 Cal.App.2d 190, 205), or that an agency
relationship could not be created by the principal’s ratification of Mathews’
alleged forgery. (Rakestraw, supra, 8 Cal.3d at p. 73.) Plaintiffs do not
propose to allege that the signatories acted without the permission of the
entities on whose behalf they signed.
Plaintiffs further contend they could have alleged that the property had
a main house in which they resided, while a “granny unit” was rented to a
tenant, and that this fact would have cured any deficiencies in the complaint
by bringing them within the protection of the Homeowner’s Bill of Rights
(citing Civ. Code, § 2924.15). Since the complaint already alleged plaintiffs
resided on the property, this proposed amendment would have changed
nothing.
Finally, plaintiffs proffer the allegation that the property was sold at a
completed foreclosure sale in October 2018. While this allegation would
transform this matter from a preforeclosure action to a postforeclosure one, it
would not change our decision. We have already assumed for the sake of
argument that Yvanova’s recognition of borrower standing applies to
plaintiffs’ presale action, but it remains the case that plaintiffs’ forgery

4Although an assignment of the deed of trust from BofA to U.S. Bank
purports to be signed by Robin Mathews, “Vice President” of SLS, SLS
apparently conceded in responding to discovery that “Robin Mathews was
never employed by Responding Party,” while maintaining “documents
evidencing the authority of Robin Mathews to execute any foreclosure-related
documents may be in the possession of other parties, including Nationstar
Mortgage LLC and Bank of America, N.A.”

15
allegations establish only a voidable, rather than void, irregularity.
(Rakestraw, supra, 8 Cal.3d at pp. 73–74; Kalnoki, supra, 8 Cal.App.5th at
p. 46; Mendoza, supra, 6 Cal.App.5th at p. 819; Saterbak, supra, 245
Cal.App.4th at pp. 814–815.)
For all of these reasons, we conclude the trial court did not abuse its
discretion in denying leave to amend.
B. Attorney Fees
Generally, each party to a lawsuit must pay its own attorney fees
unless a contract, statute, or other law authorizes a fee award. (Code Civ.
Proc., §§ 1021, 1033.5, subd. (a)(10); Musaelian v. Adams (2009) 45 Cal.4th
512, 516.) The determination of the legal basis for an award of attorney fees
is a question of law which we review de novo. (Goodman v. Lozano (2010) 47
Cal.4th 1327, 1332.)
SLS relies on section 6(E) of the promissory note, and sections 9, 14,
and 22 of the deed of trust as the contractual bases for its request for
attorney fees. Both the note and deed of trust are contracts. (See Kerivan v.
Title Ins. & Trust Co. (1983) 147 Cal.App.3d 225, 230; Henehan v. Hart
(1900) 127 Cal. 656, 657–658.) The purported fee provisions are as follows.
Under section 6(E) of the promissory note, if the borrower is in default
under the terms of the note, “the Note Holder will have the right to be paid
back by [the borrower] for all of its costs and expenses in enforcing this Note
to the extent not prohibited by applicable law. Those expenses include, for
example, reasonable attorneys’ fees.”
Section 9 of the deed of trust states in relevant part that if the borrower
defaults and “there is a legal proceeding that might significantly affect
Lender’s interest in the Property and/or rights under this Security
Instrument . . ., then Lender may do and pay for whatever is reasonable or

16
appropriate to protect Lender’s interest in the Property and rights under this
Security Instrument, including . . . paying reasonable attorneys’ fees . . . . [¶]
Any amounts disbursed by Lender under this Section 9 shall become
additional debt of Borrower secured by this Security Instrument. These
amounts shall bear interest at the Note rate from the date of disbursement
and shall be payable, with such interest, upon notice from Lender to
Borrower requesting payment.”
Under section 14 of the deed of trust, the “Lender may charge Borrower
fees for services performed in connection with Borrower’s default, for the
purpose of protecting Lender’s interest in the Property and rights under this
Security Instrument, including, but not limited to, attorneys’ fees.”
Finally, section 22 of the deed of trust states in relevant part that after
notice of default to the borrower, if the default is not timely cured, the lender
may require immediate payment in full of all sums secured by the security
instrument and may invoke the power of sale, and the lender “shall be
entitled to collect all expenses incurred in pursing the remedies provided in
this Section 22, including, but not limited to, reasonable attorneys’ fees and
costs of title evidence.”
Plaintiffs set forth several arguments as to why the award of attorney
fees under these clauses was erroneous. Their main contention is that SLS
was a nonsignatory to the note and deed of trust and did not “ ‘stand[] in the
shoes’ ” of a party to those contracts. (Cargill, Inc. v. Souza (2011) 201
Cal.App.4th 962, 966.) Plaintiffs alternatively contend that the provisions in
question are not attorney fee clauses permitting an award in litigation to
SLS.
This latter argument is supported by Hart v. Clear Recon Corp. (2018)
27 Cal.App.5th 322 (Hart) and Chacker v. JPMorgan Chase Bank, N.A.

17
(2018) 27 Cal.App.5th 351, both of which held that a clause identical to
section 9 of the deed of trust here did not provide for attorney fees in
litigation. The language of that clause—which makes attorney fees incurred
by the lender “ ‘additional debt of Borrower secured by this Security
Instrument’ ” and payable, with “ ‘interest at the Note rate . . . upon notice
from Lender to Borrower’ ”—merely added attorney fees to the secured debt
but did not justify a separate award, both courts concluded. (Chacker, at
p. 357; Hart, at pp. 325, 327.) Chacker additionally held that a clause
identical to section 14 of the deed of trust here did not permit a “freestanding
contractual attorney fees award” for the same reasons. (Chacker, at p. 357.)
As Chacker reasoned, section 14, “entitles the lender to charge the borrower
fees, and the usage of the word ‘charge,’ particularly in combination with the
‘Loan Charges’ heading and the other clauses in section 14, is naturally read
to permit the lender to add any attorney fees it may have incurred to the
outstanding amount due under the promissory note. There is no language in
section 14 that indicates the trust deed permits a freestanding contractual
attorney fees award.” (Ibid.)
SLS challenges the procedural manner in which plaintiffs have cited
Hart and Chacker, moving to strike plaintiff’s “Letter of Authority” citing
Hart as noncompliant with California Rules of Court, rule 8.254, and arguing
that plaintiffs’ citation to Chacker was belatedly made for the first time in
their reply brief. SLS further contends that plaintiffs forfeited their
arguments based on these cases by failing to present them below. Although
SLS is correct that plaintiffs should have made this argument sooner, we
observe that SLS has not been deprived of the opportunity to provide
responsive briefing. SLS included in its motion to strike a substantive
analysis of Hart and arguments as to why it is purportedly distinguishable,

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and after the conclusion of briefing, we requested and received supplemental
briefing from SLS on Chacker. Under these circumstances, and because our
independent research would have uncovered Hart and Chacker in any event
(Giraldo v. Department of Corrections & Rehabilitation (2008) 168
Cal.App.4th 231, 251 [court is not constrained to authorities cited by parties
in their briefs]), we deny SLS’s motion to strike plaintiffs’ letter of authority
and exercise our discretion to consider Chacker for the first time on appeal.
As for plaintiffs’ forfeiture, it is well settled that when an issue raises a
pure question of law, we may consider it for the first time on appeal.
(Gilliland v. Medical Board (2001) 89 Cal.App.4th 208, 219.) Our
interpretation of the note and deed of trust is a question of law (State Farm
Fire & Casualty Co. v. Lewis (1987) 191 Cal.App.3d 960, 963 [contractual
interpretation is a question of law]), as is the applicability of the holdings of
Hart and Chacker to the instant case. Accordingly, we exercise our discretion
to consider these legal issues for the first time on appeal.
Although neither Hart nor Chacker addressed provisions identical to
section 6(E) of the promissory note or section 22 of the deed of trust at issue
here, we conclude these provisions are, like sections 9 and 14 of the deed of
trust, best construed as referring to amounts that a note holder would charge
against borrowers, not that a court would separately order as an award of
attorney fees. Notably, section 6(E) of the promissory note refers to the note
holder’s right to be “paid back” its costs and expenses (including attorney
fees), a term that reasonably relates to the borrower’s loan obligation. The
language of Section 22 is less pointed, entitling the lender “to collect”
attorney fees, but this must be read in conjunction with the other provisions
of the deed of trust, including section 9’s explicit mandate that the lender’s
attorney fees “shall become additional debt.” Reasonably construed, all of the

19
clauses in question provide the same remedy to the enforcing lender or note
holder, as the incurred attorney fees are part of the same effort to enforce the
note and invoke the power of sale under the trust deed. It is of no
consequence that the note and trust deed are separate contracts, as “[s]everal
related contracts may be interpreted together, if between the same parties
and part of substantially the same transaction.” (Fireman’s Fund Ins. Co. v.
Workers’ Comp. Appeals Bd. (2010) 189 Cal.App.4th 101, 111, citing Civ.
Code, § 1642.)
Santa Clara Savings & Loan Assn. v. Pereira (1985) 164 Cal.App.3d
1089 (Pereira) does not persuade us otherwise. While Pereira held that a
lender was entitled to attorney fees under a clause materially similar to
section 9 of the deed of trust here (id. at pp. 1097–1098), we echo Hart’s
observation that Pereira was simply not called upon to decide whether those
fees could be separately awarded instead of being added to the borrower’s
indebtedness. (See Hart, supra, 27 Cal.App.5th at p. 328 [Pereira did not
“actually analyze[] whether paragraph 9 specifically provided for an award of
attorney’s fees”].)5 Cases do not stand for propositions not actually
considered by the court. (Mares v. Baughman (2001) 92 Cal.App.4th 672,
679.)
For these reasons, we conclude section 6(E) of the promissory note and
sections 9, 14, and 22 of the deed of trust allow attorney fees incurred in
enforcing the note and deed of trust to be added to the loan amount but do

Instead, Pereira addressed (and rejected) arguments that the lender
5

was not entitled to attorney fees under this provision because (1) the
borrowers did not breach the deed of trust, and (2) the lender’s attempt to
enforce an acceleration clause was not an action necessary to protect the
lender’s security interest. (Pereira, supra, 164 Cal.App.3d at pp. 1097–1098.)

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not authorize a separate fee award to SLS, the loan servicer. Accordingly, we
reverse the order awarding contractual attorney fees to SLS.6
DISPOSITION
The postjudgment order awarding SLS its attorney fees is reversed. In
all other respects, the judgment is affirmed. In the interests of justice, all
parties are to bear their own costs on appeal.

TUCHER, P.J.

WE CONCUR:

PETROU, J.
RODRÍGUEZ, J.

Rezapour et al. v. U.S. Bank National Association et al. (A156855)

In light of this conclusion, we need not address plaintiffs’ additional
6

arguments challenging the attorney fee award.

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