Mitchell Edward Schultz vs. Bayview Loan Servicing, LLC

Response

Cal. Super. - 4th Dist.August 22, 2014

K L N E D I N S T P C 8 0 1 K S T R E E T , S u r t e 2 1 0 0 S A C R A M E N T O , CA LI FO RN IA 9 5 8 1 4 x ~ N u n B A \ O 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Ian A. Rambarran, Bar No. 227366 KLINEDINST PC 801 K Street, Suite 2100 Sacramento, California 95814 (916) 444-7573/FAX (916) 444-7544 irambarran@klinedinstlaw.com G. Dale Britton, Bar No. 171844 KLINEDINST PC 501 West Broadway, Ste. 600 San Diego, CA 92101 (619) 239-8131/FAX (619) 238-8707 dbritton@klinedinstlaw.com Attorneys for Defendant BAYVIEW LOAN SERVICING, LLC SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF ORANGE MITCHELL EDWARD SCHULTZ, Case No. 30-2014-00741393-CU-OR-CIJC ANITA DARLENE SCHULTZ, and CASC PROPERTIES, LLC, Judge: Hon. Nathan Scott Dept: C-12 Plaintiffs, DEFENDANT BAYVIEW LOAN SERVICING, V. LLC'S RESPONSE AND CORRECTIONS TO [PROPOSED] SETTLED STATEMENT BAYVIEW LOAN SERVICING, LLC and DOES 1-50, inclusive, Complaint Filed: 8/22/2014 Trial Date: None set Defendants. 1. The above entitled matter came on regularly for hearing as scheduled on March 20,2017 at 2:00 p.m. in Department C-12 of the above-entitled court, Honorable Nathan Scott, Judge, presiding. The court had posted a tentative prior to the hearing. 2. Sanford Parke represented the Plaintiffs and Nick W. Schieffelin represented Bayview. 3. There was no court reporter present at the hearing. 4. After the respective counsel stated their respective appearances, the court inquired as to whetherthe parties had read the tentative and whethereither party desired to be heard. Both counsel represented that they had read the court's tentative. The defense counsel submitted on the 1 DEFENDANT BAYVIEW LOAN SERVICING, LLC'S RESPONSE AND CORRECTIONS TO[PROPOSED] SETTLED STATEMENT K L I N E D I N S T P C 8 0 1 K ST RE ET , Su rt e 2 1 0 0 S A C R A M E N T O , CA LI FO RN IA 9 5 8 1 4 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 tentative. 5. Plaintiffs’ counsel argued the Plaintiffs should be found to be the prevailing parties since they received most oftheir objective goals in their litigation. Counsel argued that the Plaintiffs may not have received the loan modification, however the Plaintiffs were able to get the Defendants to perform an additional loan modification review in which they were able to get the subject property valuation to be reduced substantially, which was the focal point of the prior review denial. The Plaintiffs’ counsel brought to the court's attention that the prior loan modification review on the Plaintiffs’ residence, which is on a hillside, the home was evaluated with another property that was lake front property with a dock. The Plaintiff’s counsel argued that the Defendant's appraiser did not take into account the difference in the location and the premium for lake front property. 6. Plaintiffs’ counsel argued that it took the presentlitigation to get Bayview to review their decision, finding these two properties being equal. Further, Plaintiffs’ counsel argued the incorrect value used in the loan modification review by Bayview caused a failure mode in the loan modification review, which forced the necessityto bring this instant action. 7. In addition, Plaintiffs’ counsel argued that Plaintiffs were prevailing party because they were able to get an additional twenty-four plus months in the residence without foreclosure. 8. Moreover, Plaintiffs’ counsel argued the Plaintiffs’ complaint alleged violations of California Homeowners Bill of Rights (HBOR), such as not providing the full Net Present Value results, and the filing of the Notice of Default while in loan modification review. Plaintiffs’ counsel stated that, since these actions were independent of Defendant's interest in the security note and the deed oftrust, they would not be considered an action against the investors or the servicers that would permit the Defendants to make a claim under the prevailing party attorney fee clause. 9. Plaintiffs’ counsel argued it was the Plaintiffs’ position the complaint was not based on contract or tort theory, but rather on violation of the Homeowners Bill of Rights such as Civil Code sections 2923.6 and 2923.7. Il] 2 DEFENDANT BAYVIEW LOAN SERVICING, LLC'S RESPONSE AND CORRECTIONS TO[PROPOSED| SETTLED STATEMENT K U u N E D I N S T P C 8 0 1 K ST re eT , Su rt e 2 1 0 0 S A C R A M E N T O , C A L I F O R N I A 9 5 8 1 4 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 10. Plaintiffs’ counsel argued that the complaint was based on violations of California law, and that the negligence and misrepresentation claims were incidental claims as a result of Defendant's actions. Plaintiffs’ counsel broughtto the court's attention that the Plaintiffs’ claims arise out of the Plaintiffs’ loan modification efforts, which did not attack or impair the servicing or the validity of the underlying loan but, rather, the handling and review ofthe application. 11. Plaintiffs’ counsel also argued that Plaintiffs had filed bankruptcy, were successfully discharged in bankruptcy court, thus their obligations under the security note and deed oftrust were terminated. Plaintiffs’ counsel argued that the Bankruptcy petition did not reaffirm the obligations, nor did the Plaintiffs reaffirm the debts during the bankruptcy proceeding. 12. Plaintiffs’ counsel further argued that the Defendant Bayview could not make an argument under section 1032 that the complaint was not primarily tort and other non-contract claims to support their argument that they were prevailing party, and at the same time make a claim under section 1717, they were successful under a contractual theory supported by the security note. Plaintiffs’ counsel also argued that under HBOR,there are no provisions for attorney fees as the only remedy was injunctive relief. 13. Moreover, Plaintiffs’ counsel argued the dismissal was with prejudice; and, therefore, the Plaintiffs were precluded from bringing or litigating the same matter. Here, the Plaintiffs dismissed the case because they did receive what they were seeking; time to complete a modification review. The Defendant Bayview also reevaluated the subject property and found that the subject property had a lower assessed value then had been previously used in the loan modification review. 14. Plaintiffs’ counsel broughtto the court's attention that the Plaintiffs were able to walk away with a valuable commodity, time and a completed modification review. 15. The court stated that the findings in In re Marriage of Walker (2015) 240 Cal.App.4th 986, 994, controlled the issue. It was the Plaintiffs’ observation that the present judicial officer was the judge that was appealed in that matter while he was assigned to the Lamoreaux Justice Center. This fact was addressed by the court and was, in part, the foundation J DEFENDANT BAYVIEW LOAN SERVICING, LLC'S RESPONSE AND CORRECTIONS TO|PROPOSED| SETTLED STATEMENT K L I N E D I N S T P C 8 0 1 K ST RE ET , Su rt e 2 1 0 0 S A C R A M E N T O , C A L I F O R N I A 9 5 8 1 4 for the court’s position on the present matter. 16. The Plaintiffs brought to the court's attention that in that particular case, In re Marriage of Walker, one party had filed bankruptcy, the other had not and that decision by the judge had improperly allocated the proceeds based on whether the party had filed bankruptcy and discharged their obligations under the note. It was the court's positionin the present matter that, under bankruptcy law, a discharge does not actually eliminate the underlying secured debt. 17. It was the Plaintiffs’ argument and contention that, in the present matter, both Plaintiffs had signed the security note, years prior to their bankruptcy, and both did not reaffirm the debt, therefore they could not be found personally liable for any judgment under the security instrument, thus the case cited by the court was not applicable. The court was not persuaded and queried that, since the Plaintiffs did not get a loan modification, but simply terminated the litigation, what success if any did the Plaintiffs achieve? 18. Plaintiffs’ counsel argued that, since the Plaintiffs did receive a benefit by being in the residence two years without a foreclosure, payment of fees, taxes, nor eviction and had been given time for a completed review for modification, they were successful. 19. Plaintiffs’ counsel suggested to the court that the series of events or lack of events from the Plaintiffs’ perspective had provided them with two years of benefits, while incurring only legal fees to prosecute a violation of statutory law. These violations of statutory law, Plaintiffs' counsel argued, were caused by bad acts of the servicer, not violations of the underlying note or security instrument, therefore the provisions contained therein would not be applicable to the present litigation. 20. The Defendant submitted onthe tentative and did not present oral argument. 21. The court ordered the parties to brief the matter as to the attorney fees issue. The court gave specific instructions as to page length timing of the brief, and hearing date for the continuation of the motion for attorney fees. 22. On 01 May 2017, at 2:00pm in Department C-12 of the above-entitled court, Honorable Nathan Scott, Judge, presiding. The court had posted a tentative prior to the hearing. [11 4 DEFENDANT BAYVIEW LOAN SERVICING, LLC'S RESPONSE AND CORRECTIONS TO[PROPOSED] SETTLED STATEMENT KL In eD IN ST P C 8 0 1 K S T r e e T , S u r t e 2 1 0 0 S A C R A M E N T O , CA LI FO RN IA 9 5 8 1 4 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 23. Plaintiffs’ counsel argued that the Defendant Bayview should not be compensated for loan modification review, correspondence regarding loan modification review, exchange of information from Bayview to Plaintiffs’ counsel, and for handling documents regarding the loan modification. Moreover, Plaintiffs’ counsel argued that any timecard entry for attorney fees regarding loan modification had no description, a nominal description, or redacted description should not be allocated to the Plaintiffs as the Defendant has not properly designated the time card entry function. 24. Plaintiffs’ counsel presented to the court their position that their Opposition Brief to Defendant's Attorney fee request was based on specifically the Defendant's hours charged, the subject matter of each entry, and allocated the ratio depending on the line count by the Defendant in order to oppose the Plaintiffs’ complaint. 25. Plaintiffs’ counsel argued the Defendant should not be compensated for defending their violations of California statutory code under the Homeowners Bill of Rights and should not be permitted to charge attorney fees in their defense and should not permitted to charge attorney fees for handling the Plaintiffs' loan modification. It was brought to the court's attention that, since the Plaintiffs could not directly communicate with Bayview in regards to the loan modification application and review, they were being punished for seeking a loan modification that Defense counsel had to handle. 26. The courtstated that all the causes of action were inextricably and intertwined to such extent that they could not be "extracted" separately. The court inquired whether the Defendant's counsel agreed with the court's position, to which Defense agreed. 27. Plaintiffs’ counsel again brought to the court's attention that the Plaintiffs should not be required to compensate the Defendant Bayview for performing the loan modification review, appeal, and handling of the loan modification process. Plaintiffs also brought to the court's attention that Defendant Bayview should not be compensated for defending underneath the UCL action since a successful defense under the UCL did not provide forattorney fees. 28. The Plaintiffs argued again that sections 1717 and 1032 were not applicable since the Plaintiffs had filed bankruptcy, and had not reaffirmed the debt, therefore could not be 5 DEFENDANT BAYVIEW LOAN SERVICING, LLC'S RESPONSE AND CORRECTIONS TO[PROPOSED] SETTLED STATEMENT KL IN ED IN ST P C 8 0 1 K ST RE ET , Su rt e 2 1 0 0 S A C R A M E N T O , CA LI FO RN IA 9 5 8 1 4 a ~ O N W n 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 personally liable under the security note and that the Plaintiffs did receive a benefit by the litigation. 29. Plaintiffs’ counsel referenced again several cases that were in Plaintiffs’ Opposition to the Defendant's Motions for attorney fees and reaffirmed their applicability in the present hearing. The court listened to Plaintiffs’ argument, and then declared that the court's tentative was the orderof the court. KLINEDINST PC DATED: October 10, 2017 By: G. Dale Britton, Esq. Ian A. Rambarran, Esq. Attorneys for Defendant/Respondent BAYVIEW LOAN SERVICING, LLC 17093154v1 6 DEFENDANT BAYVIEW LOAN SERVICING, LLC'S RESPONSE AND CORRECTIONS TO [PROPOSED] SETTLED STATEMENT K U N E D I N S T P C 8 0 1 K S T R E E T , S U I T E 2 1 0 0 S A C R A M E N T O , CA LI FO RN IA 9 5 8 1 4 w o w 3 O y 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Ian A. Rambarran, Bar No. 227366 KLINEDINST PC 801 K Street, Suite 2100 Sacramento, California 95814 (916) 444-7573/FAX (916) 444-7544 irambarran@klinedinstlaw.com G. Dale Britton, Bar No. 171844 KLINEDINST PC 501 West Broadway, Ste. 600 San Diego, CA 92101 (619) 239-8131/FAX (619) 238-8707 dbritton@klinedinstlaw.com Attorneys for Defendant BAYVIEW LOAN SERVICING, LLC SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF ORANGE MITCHELL EDWARD SCHULTZ, ANITA DARLENE SCHULTZ, and CASC PROPERTIES, LLC, Plaintiffs, V. BAYVIEW LOAN SERVICING, LLC and DOES 1-50, inclusive, Defendants. Case No. 30-2014-00741393-CU-OR-CIJC Judge: Hon. Nathan Scott Dept: C-12 PROOF OF SERVICE Complaint Filed: 8/22/2014 Trial Date: None set I declare that: I am and was at the time of service of the papers herein, over the age of eighteen (18) years and am not a party to the action . Tam employed in the County of San Diego, and my business address is 501 West Broadway, Suite 600, San Diego, California. On October 10, 2017, I caused to be served the following documents: DEFENDANT BAYVIEW LOAN SERVICING, LLC'S RESPONSE AND CORRECTIONS TO [PROPOSED] SETTLED STATEMENT 1 PROOF OF SERVICE K u n e p i n s t P C 8 0 1 K S T R E E T , S u i t e 2 1 0 0 S A C R A M E N T O , C A L I F O R N I A 9 5 8 1 4 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 OO VIA FACSIMILE TRANSMISSION: (Code Civ. Proc. §§ 1013(e) and (f)): From fax number (619) 238-8707 to the fax numbers listed below and/or on the attached service list. The facsimile machine I used complied with Rule 2.306 and no error was reported by the machine. 0 VIA ELECTRONIC TRANSMISSION: Complying with an agreement with all parties, I caused the document(s) to be sent to the person(s) at the e-mail address(es) listed below. I did not receive, within a reasonable time after transmission, any electronic message or other indication that the transmission was unsuccessful. My electronic service address is lgrennon@klinedinstlaw.com. A copy of the sent email will be maintained with the original document(s) in our office. (Code Civ. Proc. § 1010.6 and Cal. Rules of Court, Rule 2.251) 0 VIA ELECTRONIC FILING SERVICE: Complying with Code of Civil Procedure section 1010.6, my electronic business addressis lgrennon@klinedinstlaw.com and I caused such document(s) to be electronically served through the system for the above- entitled case to those parties on the Service List maintained onits website for this case. The file transmission was reported as complete and a copy of the Filing/Service Receipt will be maintained with the original document(s) in our office. VIA MAIL: By placing a copy thereof for delivery in a separate envelope addressed to each addressee, respectively, as follows: BY FIRST-CLASS MAIL (Code of Civ. Proc. §§ 1013 and 1013(a)) 0 BY OVERNIGHT DELIVERY (Code Civ. Proc. §§ 1013(c) and (d)) tl BY CERTIFIED RETURN RECEIPT MAIL (Code of Civ. Proc. §§ 1013 and 1013(a)) Sanford Parke Tel: (714) 750-5900 Law Offices of Sanford Parke Email: ocattornev@pacbell.net 1745 W. Orangewood Avenue, Suite 119 Orange, CA 92868 Attorneys for PLAINTIFFS I am readily familiar with the firm's practice of collection and processing correspondence for mailing. Under that practice, it would be deposited with the United States Postal Service on that same day with postage thereon fully prepaid at San Diego, California, in the ordinary course of business. I am aware that on motion ofthe party served, service is presumed invalid if postal cancellation date or postage meter date is more than one day after the date of deposit for mailing in affidavit, I declare under penalty of perjury under the laws ofthe State of California that the foregoing is true and correct. Executed on October 10, 2017, at San Diego, California. La Heme, Lisa M. Grennon 16006105v1 2 PROOF OF SERVICE