Notice of Demurrer And Demurrer of Defendants To Plaintiffs First Amended Complaint Memorandum of Points And Authorities In Support Thereof

Demurrer

Cal. Super. - 4th Dist.October 12, 2017

i W R I G H T F I N L A Y & ZA K *“ A T T O R N E Y S AT LA W Oo 0 NN AN n h W N N N N N N N N N N - H m e m e m e m a e m XX N N Lh kh W N R O V N O N RE W N R=, ELECTRONICALLY FILED Superior Court of California, WRIGHT, FINLAY & ZAK, LLP County of Orange Gwen H. Ribar, Esq. (SBN 188024) 0313/2018 at 10:16:00 Aw Ruby J. Chavez, Esq. (SBN 267405) Clerk of the Superior Court 4665 MacArthur Court, Suite 280 By Jeanette Torres-hendoza, Deputy Clerk Newport Beach, CA 92660 Tel: (949) 477-5050 Fax: (949) 608-9142 Attorneys for Defendants, SELECT PORTFOLIO SERVICING, INC., MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., and U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, ON BEHALF OF THE HOLDERS OF THE HOME EQUITY ASSET TRUST 2006-5 HOME EQUITY PASS-THROUGH CERTIFICATES, SERIES 2006-5 SUPERIOR COURT OF THE STATE OF CALIFORNIA IN AND FOR THE COUNTY OF ORANGE GARY W. GRABLE, Case No.: 30-2017-00949046 CAROL H. GRABLE, [Assigned to the Hon. Martha K. Gooding] Plaintiffs, Vs. NOTICE OF DEMURRER AND DEMURRER OF DEFENDANTS TO QUALITY LOAN SERVICE CORPORATION, PLAINTIFFS’ FIRST AMENDED SELECT PORTFOLIO SERVICING, INC., US. | COMPL AINT; MEMORANDUM OF BANK NATIONAL ASSOCIATION, as Trustee, | POINTS AND AUTHORITIES IN on behalf of the Holders of the Home Equity SUPPORT THEREOF Asset Trust 2006- 5 Home Equity Pass-Through Series Series 2006-5, MORTGAGE Hearing: CTRONIC REGISTRATION SYSTEMS, Date: May 7, 2018 INC., and DOES I THROUGH 50 INCLUSIVE, - 1:30 PM Dept: C-34 Defendants. Reservation #: 72771117 [Filed concurrently with Request for Judicial Notice and Declaration of Meet and Confer] TO THIS HONORABLE COURT AND TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE that on May 7, 2018 at 1:30 PM in Department C-34 of the above-captioned Court located at 700 W Civic Center Dr, Santa Ana, CA 92701 Defendants, SELECT PORTFOLIO SERVICING, INC. (“SPS”); MORTGAGE ELECTRONIC 1 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 i W R I G H T F I N L A Y & ZA K A T T O R N E Y S AT L A W © © 9 ON wn BA W R em N N O N N N O N N N N Hm Mm m e e m e m e m e a e a pm XO A N n n B R A W N R O VW N N N W N N - o o REGISTRATION SYSTEMS (“MERS”) and U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, ON BEHALF OF THE HOLDERS OF THE HOME EQUITY ASSET TRUST 2006-5 HOME EQUITY PASS-THROUGH CERTIFICATES, SERIES 2006-5 (“The Trust”), (collectively Defendants”), under California Code of Civil Procedure, §430.10(e) and (f), will and hereby demur to each and every cause of action alleged against it in the First Amended Complaint filed by Plaintiffs GARY W. GRABLE and CAROL H. GRABLE (“Plaintiffs”). This Demurrer is made on the grounds that Plaintiffs’ First Amended Complaint fails to state facts sufficient to support any of the causes of action alleged against Defendants and because the Complaint is uncertain as it is ambiguous and unintelligible. This Demurrer will be based upon this Notice, the attached Memorandum of Points and Authorities, the Declaration of Ruby J. Chavez, the complete files and records in this action, the oral argument of counsel and upon such other and further evidence as this Court might deem proper. Respectfully submitted, WRIGHT, FINLAY & ZAK, LLP Dated: March 12, 2018 By: /s/Ruby J. Chavez Gwen H. Ribar, Esq. Ruby J. Chavez, Esq. Attorneys for Defendants, SELECT PORTFOLIO SERVICING, INC., MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, and U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, ON BEHALF OF THE HOLDERS OF THE HOME EQUITY ASSET TRUST 2006-5 HOME EQUITY PASS- THROUGH CERTIFICATES, SERIES 2006-5 2 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 i W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W OO 00 NN AN nh bk W N N N RN N N N N N N = m m e d e a a e m e s a NX NN A N nn pk W N O O N N N DD E W N , SS DEMURRER Defendants SELECT PORTFOLIO SERVICING, INC. (“SPS”); MORTGAGE ELECTRONIC REGISTRATION SYSTEMS (“MERS”); and U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, ON BEHALF OF THE HOLDERS OF THE HOME EQUITY ASSET TRUST 2006-5 HOME EQUITY PASS-THROUGH CERTIFICATES, SERIES 2006-5 (“The Trust”) (collectively Defendants”), generally and specially demur to Plaintiffs’ First Amended Complaint and to each of the below enumerated causes of action contained therein, on the following grounds: The First Cause of Action (Negligence) Plaintiffs’ First Cause of Action for Negligence fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Second Cause of Action (Violations of California Homeowners Bill of Rights) Plaintiffs’ Second Cause of Action for Violations of California Homeowners Bill of Rights fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(¢) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Third Cause of Action (For Treble Damages Violation of California Homeowner Bill of Rights) Plaintiffs’ Third Cause of Action for Treble Damages Violation of California Homeowner Bill of Rights fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). 1 1 3 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 2 W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W Oo 0 9 O N Uh BA W N BN R N R N N N N N NN m m mm mm e m a em e m p m RX 9 A N L h B A W NN = O V N R L Y Rk , The Fourth Cause of Action (Cancellation of Written Instruments) Plaintiffs’ Fourth Cause of Action for Cancellation of Written Instruments fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Fifth Cause of Action (Injunctive Relief) Plaintiffs’ Fifth Cause of Action for Injunctive Relief fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Sixth Cause of Action (Predatory Lending Practices) Plaintiffs’ Sixth Cause of Action for Predatory Lending Practices fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Seventh Cause of Action (Violation of California B&P Code § 17200 et seq.) Plaintiffs’ Seventh Cause of Action for Violation of California B&P Code § 17200, et seq. fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Eighth Cause of Action (Constructive Fraud) Plaintiffs’ Eighth Cause of Action for Constructive Fraud fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure 4 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 B W R I G H T F I N L A Y & ZA K A T T O R N E Y S AT LA W Oo 0 9 O N u B R W O N R E J LS J NN N C C N © N A A RAR W N R O VO N N N RA W N -~ © §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Ninth Cause of Action (Fraud in the Concealment) Plaintiffs’ Ninth Cause of Action for Fraud in the Concealment fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Tenth Cause of Action (Slander of Title) Plaintiffs’ Tenth Cause of Action for Slander of Title fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). The Eleventh Cause of Action (Quiet Title) Plaintiffs’ Eleventh Cause of Action for Quiet Title fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(%). The Twelfth Cause of Action (Declaratory Relief) Plaintiffs’ Twelfth Cause of Action for Declaratory Relief fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California Code of Civil Procedure §430.10(f). I I 5 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 - The Thirteenth Cause of Action (Fraud in the Inducement) Plaintiffs’ Thirteenth Cause of Action for Fraud in the Inducement fails to allege any facts sufficient to state a cause of action against Defendants under California Code of Civil Procedure §430.10(e) and is uncertain as it is ambiguous and unintelligible under California WY! W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W OO 0 NN NN n n A W N N N ND N N N N N N m m e m em e a e m a a a © N N n n RA R W N = O YW NN O Y R A W N N R , Code of Civil Procedure §430.10(f). Dated: March 12, 2018 Respectfully submitted, WRIGHT, FINLAY & ZAK, LLP By: /s/Ruby J. Chavez Gwen H. Ribar, Esq. Ruby J. Chavez, Esq. Attorneys for Defendants, SELECT PORTFOLIO SERVICING, INC., MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, and U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, ON BEHALF OF THE HOLDERS OF THE HOME EQUITY ASSET TRUST 2006-5 HOME EQUITY PASS- THROUGH CERTIFICATES, SERIES 2006-5 6 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 1 W R I G H T F I N L A Y & ZA K" A T T O R N E Y S AT LA W © 0 = on Ln B A W RN om BN N N N N N N N N N m m e m e m em e a em e m p m © N N Ln BR W R N = O Y N Y RA W O N R= o o TABLE OF CONTENTS Page No. MEMORANDUM OF POINTS AND AUTHORITIES L INTRODUCTION woos o 65 6505058 05 56555505 555585605585 5545 353558 rn HE 5 555 Bi 65 16 II. STATEMENT OF FACTS oon steerer esas 16 II. LAW AND ARGUMENT ......coiticiieieeiietre estes stents tess saess sses ste essnssae sess ssens 17 A. Plaintiff’s Claims Are Barred By Judicial EStOppel .....ccccovereverrverevrnnennrceeerenenene 17 B. Plaintiff’s First Cause of Action for Negligence Fails..........ccccevereverrrerrnreereernnnnn. 18 C. Plaintiff's Claim Under the Homeowners Bill of Rights Fails..........ccccevvererennene.. 18 1. Plaintiffs are not “Borrowers” Under Civil Code § 2920.5(C)(1).ccccvurerereneen.. 18 2. This Claim Fails Against MERS...........ccoceuiriiinineiireneieeeeeee ser n ens 19 3. Plaintiffs Fail to Allege Facts to Support Any Violations of the Civil Code ..19 4. Plaintiffs Fail to Allege Any Violations of the Code Were Material .............. 20 5. Plaintiffs Are Not Entitled to Treble Damages.........ccc.cceereereerenreerernrrenrennn. 20 D. Plaintiffs’ Cause of Action for Cancellation of the SOT, NOD, NOS FAILS... s eben ens 20 E. Plaintiffs Are Not Entitled to Injunctive Relief ..........ccecervrerevirrneieniiecenene. 23 F. Plaintiffs’ Claim for Predatory Lending Practices is Uncertain and Fails ............ 23 G. Plaintiffs’ Cause of Action for Violation of the B&P Code § 17200 Fails........... 25 H. Plaintiffs’ Cause of Action for Constructive Fraud Fails ......cccecovvveervrvnrrreennnn. 26 I. Plaintiffs’ Fraud in the Concealment and Fraud in the Inducement Claims Fail...28 J. Plaintiffs’ Cause of Action for Slander of Title Fails...........ccocceuvvniiennnn.n. 29 K. Plaintiffs’ Cause of Action for Quiet Title Against Defendants Fails................... 30 7 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 Bi W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W Oo 0 I N Wn B R A W N N N N N N N N R N N M H m e em a e m e m a XX N N R A W = O S V E N O N RA W N m o Iv. L. Plaintiffs’ Twelfth Cause of Action for Declaratory Relief Fails......ooeoveveeneennen.. CONC TL IBT CIN issmmmsssssnisstomsamssss s s mau SE mos inbanFamaras anes rame atari em mnans 8 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 ¥ W R I G H T F I N L A Y & Z A K * A T T O R N E Y S AT LA W OO 0 0 O N Un BA W N ) e e BN N N N N N N N N mm e m m a e m m a p a p a p a em 0 9 A n n B A W O Y N O D N A W N = oOo TABLE OF AUTHORITIES Page No. Cases Baisa v. Indymac Fed. Bank (2009) 2009 U.S. Dist. LEXIS 103444 at ¥8, ........cccoccvrmmreerenierennnrerneeseseesesessnasesseeeneens 18,27 California Ins. Guarantee Assn. v. Superior Court (1991) 28] Cal. APRS LETT, dETB somsussimmsmusmsusmmnonnmonsssansses sm ssssmsnsiss i csi mmm 30 Careau & Co. v. Security Pac. Bus. Credit, Inc. (1990) 222 Cal. App.3d 1371, 1399, £11. 25 omic aan 27 Castaneda v. Saxon Mortg. Services, Inc. (E.D. Cal. Dec. 3,2009) 687 F.Supp.2d 1191, 1201 .cvvrorerererrererereirierereeeererienereesennas 23,29 Cel-Tech Communications, Inc. v. Los Angeles Cellular Tel. Co. (1999) 20 Cal.4th 163, 180, 184, 187 oeuvres ests srsnstss res ss esse anne esses 25 Cerecedes v. US Bankcorp (C.D. Cal July 11,2011) 2011 WL 2711071 at ¥5...overemieerercceenieieereeeeesssiseee ren 21 Cervantes v. Countrywide Home Loans, Inc. (Oth Cir. 2011) 656 F.3d T0834, 1042, cuuussmsmmsssinmsssssnintassaionssss iiton ss assis s dhnsiin sinisiissisban nbunes 22 Chua v. IB Prop. Holdings, LLC (C.D. Cal. 2011) 2011 WL 3322884, at *2......cecvieeeminirieeenesere er e eraseseaceneseassaseseseser ssaesens 21 Commonwealth Mortgage Assur. Co. v. Superior Court (1989) 211 Cal. APP.3d 508, 518; everett e rste senescence seers evens 26 Conrad v. Bank of America Nat. Bank & Sav. Assoc. 43 al, App. dih, 183, 146-58; (L996 ).mmummmmmramsssmemmmmmmn sss sss 17 Dancy v. Aurora Loan Servs., LLC 2010 U.S.Dist. LEXIS 116513, at ¥10....ccceereurrrieeeerrereeneeseriererssesesnssenescsessssssesmesscsnnsasesens 22 Debrunner v. Deutsche Bank Nat. Trust Co. (2012) 204 Cal APPA" 433, 441 c.c.coooeeeoeeeeeeeeeeeee serene sss 22 9 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 i W R I G H T FI NL AY & ZA K * A T T O R N E Y S AT LA W OO 0 9 O N Un pA W N D N N N N N N N N = mm e m e m p m p m e m m e ® 9 A n A W N = O V0 © O N D W N oo -~= Oo Efron v. Kalmanovitz (1964) 226 Cal. APDP.2d 546, 559-60 .....coccurmrrreiriirrerereeeeeetete sees tes s sts esereees sesso se ens 27 Elliot v. MERS (N.D. Cal. 2013) 2013 WL 1820904 at *2 ......cecererrerererreceenrerereeeececesisesseessessssesssesseseeesene 21 Emery v. Visa Internat. Service Ass'n (2002) 95 Cal. App. 4th 952, 960; accord Perfect 10......uvvvveeeeeeeeeeereeeeeeeereeeeeeeeerees ceases 26 Engalla v. Permanente Medical Group, Inc. (1997) 15 CalA™ 951,974 wooo eee ee eee sesso sees esses eee eee sees 28 Fontaine v. Bank of Am., N.A. 2015 U.S. Dist. LEXIS 2111 at *11-13 (S.D. Cal. Jan. 7, 2015). ....veveeereeeeeeeeseensseseeesens 28 Gen. of America Ins. Co. v. Lilly (1968) 258 Cal. APP.2d 465, 470 .....oucvirrrirereereieieerese essere tsetse ses sesss ss se essees es e sees 31 Germon v. BAC Home Loans Servicing, L.P. 2011 U.S.DiSt.LEXIS 17084, at *6......coeurerirerrerreerrernseeieseessesssensesess ss esess s asse nes sess ss sees 22 Gomez v. Wachovia Mortg. Corp. 2010 WL 291817 (N.D.Cal., 2010) c...oveurrrirrrrririeirisiessresensesceescsesesse asse se esss seseseee sesenes 20 Guessous v. Chrome Hearts, LLC (2009) 179 Cal. APP.4th 1177, 1187 c.count sass ts sess setss sss essees 23 Hafiz v. Greenpoint Mortg. Funding, Inc. (N.D. Cal., 2009) 652 F.Supp.2d 1039, 1049 ......cooerererrrerreeceeeeecreetesee ee s s sesees ness s s en 23 Hale v. Sharp Healthcare (2010) 183 Cal. App. 4th 1373, 1384. «ouverte eee estes ees ese sess er ene 26 Hamilton v. State Farm 270 F.3d 778, 782, 783-84, 85 (9th Cir. 2001) (ceevuverrrrererrerereseeceeeeeceesessees s s eeesnesess esses 17 Hills Transportation Co. v. Southwest Forest Industries (1968) 266 Cal. App.2d 702, TOT-08.......ccoreuereererrerrreirrerereeeseesereseisseisessessssassesssssseseesaeseneeene 28 LE. Assocs. v. Safeco Title Ins. Co. (IDB) 30 Cal. 3d IR, TBE corms sss 55s imimemsiomenma messes 22 10 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 I W R I G H T F I N L A Y & ZA K ** A T T O R N E Y S AT LA W OO © J O A Wn hA~A W N N N N N N O N N N N O N o H m m e a e m e b p m pe e m e a p m RX 9 A L R W N = DO VO N N ON D RN W O N Rm, Inre Allison 232 B.R. 195, 203-04: (Bankr, I, Mont, 1998) ccsssssusmmmsesmmrassmms sms mma assassins 17 Inre GlenFed, Inc., Secs. Litig. 42 F.3d 1541, 1548 (Oth Cir. 1994). c.count steers ssseste sees sess sates ssesens 27 In re Kelley 199 B.R.. 698, 702-03 (9th Cit. BAP 1996) cisne iss 5timanraeiesssiiainasans eisai snsnsnne sis is inmmesasit 17 In re Roderick (Bankr.E.D.Cal. 2010) 425 B.R. 556, S61...cueiiieeriniieteeie se iet tcsinseeseseeeee sass sess saensavanes 19 Inc. v. VISA Int’l Service Ass’n (9th Cir. 2007) 494 F.3d 788, 808-809 ......ccrcerriieirierireecirinenieeeensenessessesessessssstsese eve assesses 26 Javaheriv. JPMorgan Chase Bank, N.A. (CD. Cal, 20012) 20012 WIL FA26278’ B® s:uusuco 00s sus vaca a vss sss assis 405556358 5 5a550 5% 21 Jenkins v. JPMorgan Chase Bank, N.A. (2013) 216 Cal. App.4th 497, 513... sete eee eset sts assee sea a sans 22,29 Jerviss v. Select Portfolio Servicing, Inc. E.D. Cal. Nov. 25,2015) 2015 WL 7572130 #7 ...coevrreeceirrrereeeeenestsaeesisesssssesasasrees 20 Jimenez v. Domino's Pizza 238 F.R.D. 241, 252 (C.D. Cal. 2006) 1.10; ..c..ceetererirranririrenienanserenssssenssssssessssesassssassesssnaes 17 Johnson v. PNC Mortgage 2014 WL 6629585, at *10 (N.D. Cal. NOV. 21, 2014)...cooeceirerirririereenierereraenseesesessesae sans 20 Kachlon v. Markowitz (2008) 168 Cal, App. Ath. 316; FFB. wucummssmnnsmsavmonsnssssnssnssssnsasissnsssssssssams sms sa om assms 30 Kan v. Guild Mortg. Co. (2014) 230 CalAPDP.AH 736 ..conviriieeiiecteiecnt cette e s see st cassettes cesta saan 21 Khoury v. Maly's of Calif., Inc. (1993) 14 CAAth 612, 616 ...cumininiiiicieecieieineceecee eer e s es ev s sae sses e tebe snanes se aes e e 24 Khoury v. Maly's of California, Inc. (1993) 14 Cal. App Ath 612, 619 commesomnscmmsmmensensssmmssmsmsmmnmmmssssm santas 25 11 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 2 W R I G H T FI NL AY & ZA K“ A T T O R N E Y S AT LA W Oo 0 9 O N hn bh W O N D N D N N N N N N m m m e m e m a em e a e n © N N R W N D R , O V ® N O N D R A W N ~~ S Kim v. Sumitomo Bank of California (1993) 17 Cal. APp.4th 974, 981. ....cooiierisieeeeee etcetera sansa t eens 27 Kroeker v. Hurlbert (1940) 38 Cal. APP.2d 261, 266 .....cvvrererrrererrereriee e es esses tessa sssss nests asssssesene s nses esos 20 Ladd v. County of San Mateo (1996) 12 Cal. 4M O13, 917 o.oo eee eee e eee sees sees sesso eee eee 18 Lane v. Vitek Real Estate Group (2010) 713 F.Supp.2d 1092, at 1099........ceeereeerrerereeeeeeerete ie iceceee is esser snes se sees ees enes 22,29 Logvinov v. Wells Fargo Bank 2011 U.S.Dist. LEXIS 141988, at *9......cevevurrerrrereereiereeeiesesesieseeeesee sses ee teens ssess se s 28 Lopez v. Southern Cal. Rapid Trans. Dist. (1985) 40 Cal.3d 780, 795 .....oveveeieeieeieteeteee eters ees sess sss eens sess sees 20 Lundquist v. Reusser (1994) 7 Cal. 4th 1193, 1208-10...c.ovuevererrerrreriereieeeteee cesses sees es t e s seen 30 Major v. Wells Fargo Bank, N.A. 2014 WL 4103936, at *4 (S.D. Cal. 18,2014) .cvevuerrueeeerereerceeeeeeeeeceeeeeee ss s es eesese ess s 20 Mansour v. Cal-Western Reconveyance Corp. (D.Ariz. 2009) 618 F.Supp.2d 1178, 1182 aff’d, 2010 U.S App. LEXIS 12464 (th Clr. June 17, ZOU cuossissssasinsisinmmemrnensesssogsanssspormenssamarisss ssissmss se senssss mses sssmasasessas as es 24 McKell v. Wash. Mut., Inc. (2006) 142 Cal. APP.Ath 1457 coors esse sess sees eeses nesses essen 23 Mendoza v. JPMorgan Chase Bank, N.A. No. C071882, 2016 Cal. App. LEXIS 1083 (Ct. App. Dec. 13,2016) w..oveeeeeererreerrrerernenn. 21 Moeller v. Lien (1994) 25 Cal APD.A™ 822, 834 ooo eee sees eee esses ees eee 22 Nastrom v. New Century Mortg. Corp. (N.D. Cal. June 8, 2012) 2012 WL 2090145 Gt ¥6 .....vuveeveereieeeeeeeeeeeeeeeeeeeeeeeeeeesesss s cession 21 12 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 I W R I G H T FI NL AY & ZA K“ A T T O R N E Y S AT LA W OO © 9 Oo wn A W O N - N N N N N N N N N H m a a a e m e m m m p m © ~~ AN Un B R A W N =, O V O yg D Y E W N R S Nymark v. Heart Fed. Savings & Loan Assn. (1991) 231 Cal. App.3d 2089, 1096 .....c.ccevveimriieireeiereriise centers ase eeetess sas saeseseseneseas 18, 27 Price v. Wells Fargo Bank (1989) 213 Cal. APP.3A 465, 476 ccc esse es eaaas sess assesses esse abana 27 Packers, Inc. v. Ballantine Produce Co., Inc. 2011 U.S. Dist. LEXIS 32111, at *23 (E.D. Cal. Mar. 25, 201 L.......cccovveererrrrrenrcrirsnreerecenenens 27 Perlas v. GMAC Mortg., LLC (2010) 187 Cal. APP.Ath 429... resect eset sas esses sass tees sa eas 24 Puentes v. Wells Fargo Home Mortg., Inc. (2008) 160 Cal. App.4th 638, 643-644 ........ccovvevereeereinrniernreresessetireseesssssetssesesssssessssssessessseseses 25 Rissetto v. Plumbers and Steamfitters Local 343 94 F.3d 597, 600-601 (9th Cir. 1990) ....ccevevruereerireeiererenenesetriseeseeseesessssse sae sessss s sss s s s se se enns 17 Roberts v. Ball, Hunt, Hart, Brown & Baerwitz (1976) 57 Cal. App.3d 104, 109-110; ....crueeerereriirirteirieieienirieeseeseseesnee see s ss sess s ssesasse as s s 26 Santos v. Countrywide Home Loans (E.D. Cal., Nov. 6, 2009, CIV.20902642WBS DAD) 2009 WL 3756337, *4.....ccccccevererererne 30 Saunders v. Sup.Ct. (1999) 27 Cal. App.4th 832, 838... treet sve ee seas bets ae ears 25 Schauer v. Mandarin Gems of Cal., Inc. (2005) 125 Cal.App.4th 949, 960-61 ................. RFRA fs Hn SES 4 deme EAB ew br sei 26 Semegen v. Weidner 780 F.2d 727, 731 (Oth Cir. 1985). ecutive ste ssae sees besess sss asasae ese se sven 26 Service by Medallion, Inc. v. Clorox Co. (1996) 44 Cal. App.4th 1807, 1818 ...c.ooveerirerreeeeereeirisieees aes sre setae s eres sasse esses eae sens 24 Shapiro v. Wells Fargo Realty Advisors (1984) 152 Cal. ApD.3d 467, 479). cusurisssvmminsssss smsemssnsnsnosssussssans ss sams as amassssso isis: 26, 28 Shimpones v. Stickney (1934) 219 Cal. 637, 649 .....oovieiiiiiecectte teeters test eres esas sees ncase beas s anes 30 13 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 i W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W NO RX d N nn BR W N N N N R N R N N N ) m m e a m e e m e m e m a e m pe XX N A A BRA W R N R O VW N N T R A W O N = o Sipe v. McKenna CLEAR 88 Callen id) TON]. JTOHIER osseous esses 5a Sh S850 SESE Sm ns 30 Sonoma Foods, Inc. v. Sonoma Cheese Factory, LLC 634 F.Supp.2d. 1009, 1021 (N.D. Cal. 2007). ...cccecerrrrrrereereerereessesseieseseessssesseesosensesenas 26 Spencer v. DHI Mortgage Company, LTD (2009) 642 F.Supp.2d 1153, TT16] overeat es ese sees sasse sense sass 27, U.S. Hertz, Inc. v. Niobrara Farms (1974) 41 Cal. APDP.3d 68, 85 ....ooeeireeirieirieeeierresrr eres a sses s ss sae essen 23 Williams v. Wraxall (1995) 33 Cal. ApP.4th 120, 132 c.ecuvieiriiereeeceieeeeeecte seater ee eects snes esses b sas see sees 24 Wilton v. Mountain Wood Homeowners Assn. (1993) 18 Cal APP Ath 565; STU cusses sssusssiensasionaniesinsmsnassssssusrsinasinbussnersssnsnsessasassmsrrssavasssessagess 30 Younan v. Equifax Inc. (1980) 111 Cal. App.3d 498, 516, fn. 14; see also Civ. Code, § 1573 c.covvvvevererrrireerereecnan 26 Yvanova v. New Century Mortgage Corp. (2016) 62 Cal.4th 919) .....cviiieieeiciricrecrr reteset r assess sass sass sense nen esse ses 22 Statutes 11 UBC. § SACL smoussssnsumunsncissss issues sassvn inmsvasarsesnssssasasnssenserssasmsasassnmasssamsms et y spas sues erasers 19 Cowl Copy 2024 JH 0 2) TPC 11100) exomsnmemaesonssmscsssccs sisson sess sss SS ES 58 dams meesmmmomereans 20 Bus. & Profs. Code, §1T204 .....u eerie eeteeeeie eres steers sssssssscsssssess sss sssssessentssessnensssseaneenes 26 Business and Professions Code § 17200 ........ueeueeeeeeeieeeeesieieeeeeeeesessesesesessssesssssssssesssesesssnens 25 Eker, ABD, TOE sucusnsscosoasmnassos ssi cassis som ees omens asin so sm ames ns es ms se A BSE 23 Calitornin Civil Code § 292355) mss omsnsusasmssnsiisssiss hus sumnesoniara nsanssbonsicoumns essssnssopagrgss 19 California Code of Civil Procedure § 760.0102) .....c.ceeverrrerereeereeerererireesiresereseeeseesseesene e esenens 30 Civil Code § 2920.5(C)(1), erueuerererreineeirrireieenirerieseseesessssssssssesasessesesssesesesssesesesenssssesessssssesessasnens 18 CIVIL COE § 2923.55 coerce eset erasers steer tetas sess nse sneer ease see sees en neas 19 Civil Code § 29241 2(B)....cconi vis isismsuissssisirinemsnersesssasstoranossnsssarssssssanstsseasass asasen s a sess sus savas er esmm ss 20 Cyl Code § TIAA cco iimsissciisnomssmissmiminsinssinsiistummmmommmss ss rensamtuessmms sons sos msomeemas pt ao SE SEEES 23 14 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 i W R I G H T FI NL AY & ZA K * A T T O R N E Y S AT LA W OO © 3 O N Un A W O N BN N N N N N RN N N H H mm e m m m mm a e m e m e m © N A RA W N RE, O Y N N N RAN W O N R o Civil Code §§ 2924, €6 SEG «uveitis secretes snes eres e esses erases sass ee sresanss ens srenaatan 22) CIVIL COB §AT(D).veueeeerenteereeneeeetnieseesrse stare sestese cress asesesaesesse sts sassessasassessessrses es ssssse ansans sensases 30 Civil Code Section 2923.55 ......coiverieeieeccieeieieese creases esses te se sessess essere st ese se resss ses astssrssassasersenes 20 Civil Code] Sections 2924-29241...........ccuiieeeiiiereieeeeeseirtieseesseestsssesssessessssesssossassssssstessssessessssnsenes 22 Code Civ. Pro. SEC. 338(A). ueiiirtiieieeeeeeeieeetereste crests eres see bt sses ese assent estes sas sae s nses ens enesa bens 24 Code of Civil Procedure § 430.10 (£) c..ccveeeeriiereereceeeeteeeee crete esses es sve tense veaste bes se sn s ne ane 2] Code of Civil Procedure § 430.10 (£). .oveveeierieieriereeeeeeiee eects eves cess esses bears eaesebenes ses eas ans ene 18 Code of Civil Procedures § 338(d)s suwmsmsammanmmmsimsmsosmsemimsmasmensmmmsimiin 23 Other Authorities 5 Witkin, Summary of Cal. Law, supra, Torts, § 642, P. 948....c.oveeevevereeeeeereesrieeeeesieeseerensone 29 Summary of California Law, (2005), B.E. Witkin, 10M Ed., § 642 «vem eveeveeeeeeeeeeereceereseeesesreee 29 Treatises 3 ‘Witkin, Cal. Proc. 5th. (2008 Pleat, § TTD: TI amass noms i msn as oii #5555 Sbammeos 26 15 NOTICE OF DEMURRER AND DEMURRER TO FIRST AMENDED COMPLAINT Grable v. Quality Loan Service Corp., et al., Court Case No. 30-2017-00949046 W R I G H T FI NL AY & ZA K“ A T T O R N E Y S AT LA W OO 0 J O N Un bk W N N N ND N N N N N N D r e k e e m p m a e d p d e a p m p m 0 N N Ln kh W N R O OV N N O D R A W N = o o MEMORANDUM OF POINTS AND AUTHORITIES I. INTRODUCTION Plaintiffs have not made a payment on their loan for almost five years. Plaintiffs received a discharge of their personal obligations under the loan in bankruptcy court on July 13, 2015. Despite having the opportunity, Plaintiffs did not raise any alleged issues regarding the transfer of the Note and assignment of the Deed of Trust in their prior bankruptcy action. Thus, they are judicially estopped from doing so now, some five years after the Assignment of Deed of Trust was recorded. Plaintiffs have failed to state any viable claim against Defendants and this Demurrer should be sustained without leave to amend. IL. STATEMENT OF FACTS On or about March 22, 2006, Plaintiffs executed a promissory note, in the principal amount of $493,500.00, in favor of Encore Credit Corp. secured by the property located at 19462 Misty Ridge Lane, Lake Forest, CA 92679 (the “Property’) encumbered by a Deed of Trust (Note and Deed of Trust will be referred to as “the Loan”). (Request for Judicial Notice “RIN” Exh. 1). The Deed of Trust designated MERS as the beneficiary as nominee for the lender and the lender’s successors and assigns. (RIN, Exh. 1). On October 11, 2012, an Assignment of Deed of Trust was recorded reflecting that MERS assigned the Deed of Trust to the Trust. (RIN Exh. 2). On October 15, 2012, Quality Loan Service Corporation was substituted in as Trustee. (RIN Exh. 3). On March 26, 2015, Plaintiffs filed a Chapter 7 Bankruptcy Petition in the U.S. Bankruptcy Court for the Central District of California (“the Bankruptcy”). (RIN Exh. 4). On page 18 of the Petition, Plaintiffs identifies SPS as their creditor of the first mortgage on the Property and lists the amount of the undisputed claim as $565,735.00. (RJN Exh. 4). On July 13, 2015, a discharge of Plaintiffs was entered in the Bankruptcy. (RIN Exh. 5). Since Plaintiffs were $117,990.14 in arrears on the Loan, a Notice of Default and Election to Sell Under Deed of Trust was recorded on August 3, 2015. (RJN Exh. 6). On June 23, 2017, a Notice of Trustee’s Sale was recorded. (RIN Exh. 7). 1 16 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT IH W R I G H T F I N L A Y & ZA K" A T T O R N E Y S AT LA W oOo 0 3 O N n n BA W O N N N N N N N N N N = e m e a e a e m a p m a p m R 3 9 S N Ln kA W N = O O N N N RA W N , OS III. LAW AND ARGUMENT A. Plaintiffs’ Claims are Barred by Judicial Estoppel. Judicial estoppel is an equitable doctrine that precludes a party from gaining an advantage by asserting one position, and then later seeking an advantage by taking a clearly inconsistent position.” Rissetto v. Plumbers and Steamfitters Local 343,94 F.3d 597, 600-601 (9th Cir. 1990). A debtor who fails to disclose a potential claim in Bankruptcy lacks standing to sue and is judicially estopped from recovery. Jimenez v. Domino's Pizza, 238 F.R.D. 241, 252 (C.D. Cal. 2006) n.10; Hamilton v. State Farm, 270 F.3d 778, 783-84 (9th Cir. 2001)(judicial estoppel barred former debtor from asserting claims not disclosed in bankruptcy schedules). Plaintiffs did not disclose the existence of any of the claims regarding the validity of Assignment, predatory lending practices, or Defendants’ failure to credit payments in the Bankruptcy. (RIN Exh. 4). Both California state and Federal courts have stringently applied the doctrine of judicial estoppel in cases involving bankruptcy asset concealment to preclude the debtor from bringing a later action on claims which should have been brought, or at least disclosed, in the bankruptcy proceedings. See Hamilton, supra, at 782-85 (9thCir. 2001); In re Allison, 232 B.R. 195, 203-04 (Bankr. D. Mont. 1998); In re Kelley, 199 B.R. 698, 702-03 (9th Cir. BAP 1996); Conrad v. Bank of America Nat. Bank & Sav. Assoc., 45 Cal. App. 4th 133, 146-55 (1996). In Conrad, the Court recognized the “well-settled” law that where a debtor in bankruptcy fails to identify or list a claim in the bankruptcy, including at the inception of the bankruptcy and leading up to the reorganization plan's confirmation, such claim is barred in any post-proceeding actions by judicial and equitable estoppel. Id. at 148. Here, Plaintiffs’ Causes of Action materialized before they petitioned for bankruptcy and, thus, they are barred from asserting them now. Plaintiffs must have known the facts which serve as the basis of their allegations that the Assignment was “void and has no force and effect,” as the Assignment in question was recorded in the public record more than two years before Plaintiffs filed their petition. Because Plaintiffs failed to disclose these potential claims to their bankruptcy trustee, their claims as to the validity of the Assignment, predatory lending 17 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT 12 W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W OO 00 NN O N Un B W ND R N R RN ND N N N N D = m m e a e m e m e m e m o e RO N A A n k W D = O WV E N O N D R A W N = o o practices, and claims regarding the Defendants’ failure to credit payments are barred by judicial estoppel. B. Plaintiffs’ First Cause of Action for Negligence Fails. To maintain a cause of action for negligence, a plaintiff must establish: (1) duty (2) breach (3) causation, and (4) damages. Ladd v. County of San Mateo, (1996) 12 Cal. 4" 913, 917. As a general rule, “a financial institution owes no duty of care to a borrower when the institution’s involvement in the loan transaction does not exceed the scope of its conventional role as a mere lender of money.” Nymark v. Heart Fed. Savings & Loan Assn..(1991) 231 Cal. App.3d 2089, 1096. Also, as explained in Baisa v. Indymac Fed. Bank (2009) 2009 U.S. Dist. LEXIS 103444 at *8, plaintiff cannot establish MERS owed a duty of care because plaintiff cites no authority, no assumption of duty by MERS, and no special relationship between MERS and Plaintiffs. Instead, MERS as the listed beneficiary, as nominee for the lender and the lender’s successors and assigns, under the Deed of Trust has authority to assign the Deed of Trust to another party. Id. Plaintiffs simply conclude that Defendants had a duty here. FAC, 940. Plaintiffs then allege that Defendants failed to “accurately credit payments made by Plaintiffs toward the loan,” prepared “false documents,” and foreclosed “without having the legal authority and/or proper documentation to do so.” FAC, §42. There are no facts to support these conclusions and this pleading is uncertain under Code of Civil Procedure § 430.10 (f). None of Plaintiffs’ allegations establish any basis for a creation of a duty - let alone a breach of that duty that proximately caused damages. Plaintiffs also cannot establish the harm element due to a lack of factual allegations demonstrating that they suffered a harm which must be redressed or a threat that needs to be subsided. Any impending foreclosure threat Plaintiffs are currently facing is a direct result of their own conduct, and not of that of Defendants. C. Plaintiffs’ Claims under the Homeowners Bill of Rights Fails. 1. Plaintiffs are Not “Borrowers” Under Civil Code § 2920.5(c)(1). Plaintiffs do not meet the definition of “borrower” under Civil Code § 2920.5(c)(1), 18 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT 12 W R I G H T F I N L A Y & ZA K A T T O R N E Y S AT LA W © 0 ua ON Wn BA W N N O N R O N R O R N N ND = ® JI & G E O N = & © ®» I oa N R D O -~ oo which for purposes of Civil Code § 2923.55 is a person who is a mortgagor or trustor and who is potentially eligible for any federal, state, or proprietary foreclosure prevention alternative program offered, by or through, his or her mortgage servicer. On March 26, 2015, Plaintiffs received a discharge in the Bankruptcy, which included a discharge of personal liability under the Loan. (RIN Exh. 4, 5). Although Plaintiffs had the opportunity, they chose not to seek a reaffirmation of the Loan in the Bankruptcy. By statute, no agreement for which the consideration is "in part" based on a dischargeable debt is enforceable if the agreement is made after the granting of a discharge. 11 U.S.C. § 524(c)(1); In re Roderick (Bankr.E.D.Cal. 2010) 425 B.R. 556, 561. Thus, Plaintiffs were not potentially eligible for any foreclosure prevention alternative programs because this Loan was already discharged in March 2015, prior to the recorded Notice of Default in August 2015. As such, they lack standing to assert this Cause of Action. 2. This Claim Fails Against MERS. Plaintiffs claim that the foreclosing defendants did not contact them prior to the recording of the Notice of Default. The Assignment of Deed of Trust reflecting MERS’ assignment of the Deed of Trust was recorded on October 11, 2012. (RIN Exh. 2). The Notice of Default was recorded on August 3, 2015. (RIN Exh. 6). Therefore, this alleged violation of Civil Code § 2923.55 does not apply to MERS, who assigned the Deed of Trust long before the Notice of Default was recorded. This claim fails against MERS as it was not a foreclosing defendant. 3. Plaintiffs Fail To Allege Facts To Support Any Violations of the Civil Code. Civil Code § 2923.55 requires only that servicers “contact the borrower...in order to assess the borrower’s financial situation and explore options for the borrower to avoid foreclosure” at least 30 days prior to recording the Notice of Default. According to the Declaration of Compliance attached to the Notice of Default, SPS contacted the Plaintiffs on July 14, 2014 to assess the borrower’s financial situation and explore options for the borrower to avoid foreclosure as required by California Civil Code § 2923.55(b)(2). (RIN Exh. 6). The Notice of Default was then recorded on August 3, 2015. (RJN Exh. 6.) This is enough to satisfy 19 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT th W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W NO 0 N N O N Wn A W N NN N N N D N D N N N N N mm -/ e m e m e m e m em e m p m p m XR 9 L B A WLW = O YU N N N RAE WL NN = OD section 2923.55. There is nothing in the statute which requires the contact to be particularly memorable. As such, the sheer fact that Plaintiffs do not recall being contacted is no defense here. 4. Plaintiffs Fail to Allege Any Violations of the Code Were Material. Plaintiffs fail to allege the materiality of the supposed violation, as is required in order for a Homeowner’s Bill of Rights (“HOBR”) violation to become actionable. The Court in Johnson v. PNC Mortgage, 2014 WL 6629585, at ¥10 (N.D. Cal. Nov. 21, 2014) emphasized that “per se” violations of the statute are not actionable absent allegations that such violations were in fact material to the loan in question. See also Major v. Wells Fargo Bank, N.A., 2014 WL 4103936, at *4 (S.D. Cal. 18, 2014). Plaintiffs do not dispute that the Loan is in default and that they chose to discharge their personal obligations under the Loan in the Bankruptcy. Any foreclosure is a direct result of the Plaintiffs not making their Loan payments. Therefore, any violations of Civil Code Section 2923.55 would not be “material” as contemplated under sections 2924.12(a)(2) and (b); Jerviss v. Select Portfolio Servicing, Inc. E.D. Cal. Nov. 25, 2015) 2015 WL 7572130 *7. 5. Plaintiffs Are Not Entitled to Treble Damages. As the foreclosure sale has not occurred, Plaintiffs do not have a claim to treble damages, monetary damages, or statutory damages under Civil Code § 2924.12(b). Instead, any award is limited to injunctive relief. Civil Code § 2924.12(a)(1). Thus, Plaintiffs’ third cause of action must be dismissed. D. Plaintiffs’ Cause of Action for Cancellation of the SOT, NOD, NOS Fails. To bring a cause of action for cancellation of a written instrument, a plaintiff must allege facts affecting the validity and invalidity of the instrument which is attacked. Kroeker v. Hurlbert (1940) 38 Cal.App.2d 261, 266. Allegations of statutory violations must be alleged with particularity. Gomez v. Wachovia Mortg. Corp. (N.D. Cal., Jan. 19, 2010, CV-09-02111 SBA) 2010 WL 291817, citing Lopez v. Southern Cal. Rapid Trans. Dist. (1985) 40 Cal.3d 780, 795.) Here, Plaintiffs are seeking to cancel “the substitution of trustee (SOT), Notice of Default (NOD), and Notice of trustee’s sale NTS)” [FAC, q 62] based on their conclusion that 20 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT m W R I G H T F I N L A Y & ZA K“ A T T O R N E Y S AT LA W OO 00 N N O N Wn Bl W N N N N N N N N N N m m mm e m e e Defendants “acted willfully and with a conscious disregard for Plaintiff’s rights and with a specific intent to defraud and injure Plaintiff, by causing the above documents to be prepared and recorded without a factual or legal basis for doing so.” FAC, § 63. There are no facts to support this baseless conclusion. Because this pleading is uncertain under Code of Civil Procedure § 430.10 (f), this Demurrer should be sustained. In the FAC, § 21, Plaintiffs allege that the Assignment of Deed of Trust executed by MERS was robo-signed. It is unclear what the purpose of these allegations are, but to be clear, claims of purported “robo-signing” of documents - even if such claims were true- do not affect Plaintiffs’ obligations under the Loan, and are irrelevant for purposes of this action. Purportedly “robo-signed” documents are merely voidable, and not void, and a borrower lacks standing to challenge a document on the basis that it was “robo-signed” because Plaintiffs are not a party to those documents, particularly where the only claimed harm is a foreclosure resulting from Plaintiffs’ own undisputed default. See Mendoza v. JPMorgan Chase Bank, N.A., No. C071882, 2016 Cal. App. LEXIS 1083 (Ct. App. Dec. 13, 2016); Chua v. IB Prop. Holdings, LLC (C.D. Cal. 2011) 2011 WL 3322884, at *2; Cerecedes v. US Bankcorp (C.D. Cal July 11,2011) 2011 WL 2711071 at *5; Nastrom v. New Century Mortg. Corp. (N.D. Cal. June 8, 2012) 2012 WL 2090145 at *6; Elliot v. MERS (N.D. Cal. 2013) 2013 WL 1820904 at *2; Javaheri v. JPMorgan Chase Bank, N.A. (C.D. Cal. 2012) 2012 WL 3426278 at *6. Plaintiffs’ claims of robo-signing are nothing more than a red herring, designed to distract from the real facts of this case. If, in fact, Plaintiffs are challenging the Assignment of the Deed of Trust, Plaintiffs do not have standing to make such challenge. Kan v. Guild Mortg. Co. (2014) 230 Cal. App.4th 736. Nevertheless, Plaintiffs appear to claim that the Assignment is invalid because MERS and SPS are not the “holder of Plaintiffs’ Note in due course and has no legal authority to transfer and convey Plaintiff’s interest in the deed of trust...” FAC, 21. However, Plaintiff’s theory has been repeatedly rejected by the Courts. As an initial matter, the Deed of Trust specifically provides that MERS is the beneficiary and can exercise the rights of the lender and its successors, which includes the right 21 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT WY! W R I G H T FI NL AY & ZA K" A T T O R N E Y S AT LA W OO 00 J O O Wn A W N N N N N N N N N N D = em e a a e a e m pe d p e pe a 0 N N nn A W N = O VW N N N RAN W N H S to assign the Deed of Trust. Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal. App. 4th 256, 270-271 (disapproved on other grounds by Yvanova v. New Century Mortgage Corp., (2016) 62 Cal.4th 919) (upholding MERS authority to act as beneficiary as nominee for the lender and the lender’s successors and assigns under the Deed of Trust); Cervantes v. Countrywide Home Loans, Inc., (9th Cir. 2011) 656 F.3d 1034, 1042. Whether or not MERS is a holder or owner of the Note is irrelevant. Dancy v. Aurora Loan Servs., LLC, 2010 U.S.Dist. LEXIS 116513, at *10; Germon v. BAC Home Loans Servicing, L.P.,2011 U.S.Dist. LEXIS 17084, at *6. Moreover, the Civil Code establishes a comprehensive and exclusive set of regulations for the conduct of nonjudicial foreclosures. See, Moeller v. Lien (1994) 25 Cal.App.4th 822, 834 (“The comprehensive statutory framework established to govern nonjudicial foreclosure sales is intended to be exhaustive.”); LE. Assocs. v. Safeco Title Ins. Co. (1985) 39 Cal.3d 281, 285 (“The statutory provisions regulating the nonjudicial foreclosure of deeds of trust are contained in [Civil Code] sections 2924-29241. These provisions cover every aspect of exercise of the power of sale contained in a deed of trust.”). Civil Code §§ 2924, et seq., however, does not require physical possession of the promissory note to initiate foreclosure; nor do these sections require the trustee to find out who does physically possess the note. Instead, Civil Code section 2924(a)(1) provides that “[t]he trustee, mortgagee, or beneficiary, or any of their authorized agents” may commence the nonjudicial foreclosure process by recording and servicing a notice of default. See, Debrunner v. Deutsche Bank Nat. Trust Co. (2012) 204 Cal.App.4th 433, 440 (“[T]he procedures to be followed in a nonjudicial foreclosure are governed by sections 2924 through 2924k, which do not require that the note be in the possession of the party initiating the foreclosure. We likewise see nothing in the applicable statutes that precludes foreclosure when the foreclosing party does not possess the original promissory note.”); Jenkins v. JPMorgan Chase Bank, N.A. (2013) 216 Cal.App.4th 497, 513(disapproved on other grounds by)(“...we find the statutory provisions...do not require that the foreclosing party have an actual beneficial interest in both the promissory note and deed of trust to commence and execute a nonjudicial foreclosure sale.”); Lane v. Vitek Real Estate Group (2010) 713 F.Supp.2d 1092, at 1099 (“There is no stated requirement in California’s 22 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT B W R I G H T FI NL AY & ZA K * A T T O R N E Y S AT LA W OO 0 NN Oa Wn B A W N N R D N D N ND N N N - ® J 0 Gh A O N S 3 0 x» 3 a n r 0 3 non-judicial foreclosure scheme that requires a beneficial interest in the Note to foreclose.”); Castaneda v. Saxon Mortg. Services, Inc. (E.D. Cal. Dec. 3, 2009) 687 F.Supp.2d 1191, 1201. SPS, in its capacity as the loan servicer and attorney-in-fact for the Trust, had the authority to substitute Quality as trustee and, pursuant, to Civil Code § 2934a(d), once recorded, the substitution provided conclusive evidence of Quality’s authority. Indeed, absent a showing of actual prejudice, Plaintiff lacks standing to challenge the substitution at all. See U.S. Hertz, Inc. v. Niobrara Farms, (1974) 41 Cal. App.3d 68, 85. Unlike a borrower's right to have only the current owner (or its agent) enforce the rights under the deed of trust, a borrower's "rights are in no manner affected" by any procedural irregularities in a recorded substitution. /d. Furthermore, any claim that Defendants intended to defraud Plaintiffs by recording the Assignment fail pursuant to the statute of limitations. Code of Civil Procedures § 338(d). Also, this claim would not apply to MERS because it was not a party to “the substitution of trustee (SOT), Notice of Default (NOD), and Notice of trustee’s sale (NTS)” [FAC, J 62] as these notices were recorded after the Assignment of Deed of Trust. (RIN, Exh. 2). E. Plaintiffs are Not Entitled to Injunctive Relief. Plaintiffs’ request for injunctive relief fails because injunctive relief is not considered to be a viable cause of action in California. See, Guessous v. Chrome Hearts, LLC (2009) 179 Cal. App.4th 1177, 1187 (Injunctive relief is a remedy, not a cause of action). As explained in Hafiz v. Greenpoint Mortg. Funding, Inc. (N.D. Cal, 2009) 652 F.Supp.2d 1039, 1049, “injunctive relief is a remedy which must rely upon underlying claims. If plaintiff seeks injunctive relief, she should request it as part of her prayer for relief.” (/bid.) F. Plaintiffs’ Claim for Predatory Lending Practices is Uncertain and Fails. Plaintiffs allege that Defendants have “collaborated to engage and engaged in predatory lending practices” including, “failure to comply with statutory disclosure requirements under the Rosenthal Fair Debt Collection Practices Act.” FAC, 91 79-81. This claim may be dismissed because it is uncertain, ambiguous and unintelligible.” C.C.P. §430.10(f). Defendants cannot reasonably respond or reasonably determine what issues must be admitted or denied, or what 23 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT 14 W R I G H T F I N L A Y & ZA K" A T T O R N E Y S AT LA W Oo 0 N N Ln B R A W N N N D N D N N N N N N H m m m e m e m e m e m e m p m NX N A N Wn E W N E O VO N N N E W N = o o counts or claims are directed against each Defendant. Khoury v. Maly's of Calif, Inc. (1993) 14 CA4th 612, 616. To the extent the claim is based on fraud in the Loan’s origination, it is barred by the three year statute of limitations under Code Civ. Pro. Sec. 338(d). The claim would also fail because it is not pled with sufficient specificity. Perlas v. GMAC Mortg., LLC (2010) 187 Cal.App.4th 429, 434 (“Each element in a cause of action for fraud... must be factually and specifically alleged.”). Moreover, Plaintiffs did not allege a causal relationship between the purported fraud and their damages. And, “[a] ‘complete causal relationship’ between the fraud or deceit and the plaintiff's damages is required. ... Causation requires proof that the defendant's conduct was a ‘substantial factor’ in bringing about the harm to the plaintiff.” Williams v. Wraxall (1995) 33 Cal.App.4th 120, 132. “Deception without resulting loss is not actionable fraud.” Service by Medallion, Inc. v. Clorox Co. (1996) 44 Cal. App.4th 1807, 1818. To the extent the claim is based on an alleged violation of the Fair Debt Collection Practices Act, “none of the Defendants (an assignee, a servicing company, and a fiduciary) is a "debt collector" as defined in the FDCPA....the non-judicial foreclosure proceeding at issue is not an attempt to collect a "debt" for FDCPA purposes. Mansour v. Cal-Western Reconveyance Corp. (D.Ariz. 2009) 618 F.Supp.2d 1178, 1182 gff*d, 2010 U.S App. LEXIS 12464 (th Cir. June 17,2010). Defendants were not even the Plaintiffs’ lender at the Loan’s origination. In March 22, 2006, Plaintiffs received the Loan from Encore Credit Corp. (“RIN Exh. 1). The Deed of Trust designated MERS as the beneficiary as nominee for the lender and the lender’s successors and assigns. (RJN, Exh. 1). Thus, this claim is not applicable to Defendants who were clearly not Plaintiffs lender at the origination of the Loan. As far as damages, the anticipated foreclosure of the Property is solely the result of the uncured default and failure to repay the Loan for the past four and a half years. Thus, Plaintiffs’ cause of action fails and is subject to this Demurrer. 1 1 24 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT iH W R I G H T F I N L A Y & ZA K ** A T T O R N E Y S AT LA W Oo 0 9 O N Un B A W ND = BN N N N N N N N N m m em e a e a p m e m p m e m e a ® NN A Un t kh L N 2 S YW E N D RA W N =, o e G. Plaintiffs’ Cause of Action for Violation of the B&P Code § 17200 Fails. Business and Professions Code § 17200 prohibits any unlawful, unfair or fraudulent business acts or practices and unfair, deceptive, untrue or misleading advertising. Puentes v. Wells Fargo Home Mortg., Inc. (2008) 160 Cal. App.4th 638, 643-644. “Unlawful” practices are “forbidden by law, be it civil or criminal, federal, state, or municipal, statutory, regulatory, or court-made.” Saunders v. Sup.Ct. (1999) 27 Cal. App.4th 832, 838. “Unfair” practices constitute “conduct that threatens an incipient violation of an antitrust law, or violates the policy or spirit of] one of those laws because its effects are comparable to or the same as a violation of the law, or otherwise significantly threatens or harms competition.” Cel-Tech Communications, Inc. v. Los Angeles Cellular Tel. Co. (1999) 20 Cal.4th 163, 187. When determining “whether the challenged conduct is unfair within the meaning of the unfair competition law..., courts may not apply purely subjective notions of fairness.” Id. at 184. The “fraudulent” prong under the UCL requires a showing of actual or potential deception to some members of the public, or harm to the public interest. Id. at 180; McKell v. Wash. Mut., Inc. (2006) 142 Cal. App.4th 1457. “A plaintiff alleging unfair business practices under these statutes must state with reasonable particularity the facts supporting the statutory elements of the violation.” Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 619. Also, there is no vicarious liability in UCL actions, rather, liability must be based on a defendant's personal participation in the unlawful practices and unbridled control over the practices. Emery v. Visa Int’l. Serv. Ass'n, (2002) 95 Cal. App. 4th 952, 960. Here, Plaintiffs do not allege any facts to demonstrate any conduct by Defendants which could be classified as an unlawful, fraudulent, or unfair business act or practice. The best Plaintiffs can come up with are unsupported, generic allegations which have no substance, let alone merit. For example, Plaintiffs wildly claim that Defendants represented “that the foreclosure process would be delayed during the loan modification process.” FAC, 87. However, the basis of Plaintiffs’ suit is that they were never reviewed for a modification and that Defendants did not have authority to assign the Deed of Trust. Thus, this allegation is uncertain, at best. 25 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT ¥ W R I G H T FI NL AY & ZA K A T T O R N E Y S AT LA W NO 00 3 O&O Un A W N D N D N D N N N N O N O N m m m m m m m m m m e m e m e a © N S L R A W N R D O 0 N N O DRE W O N m e m o Plaintiffs fail to differentiate between the conduct of the Defendants here even though the concept of vicarious liability has no application to actions brought under the UCL. Emery v. Visa Internat. Service Ass'n, (2002) 95 Cal. App. 4th 952, 960; accord Perfect 10, Inc. v. VISA Int'l Service Ass'n, (9th Cir. 2007) 494 F.3d 788, 808-809. Plaintiffs’ cause of action fails because Plaintiffs do not allege any facts to demonstrate their standing to allege this claim against Defendants. To have standing to allege a claim for violation of Section 17200, a plaintiff must allege that he suffered an injury-in-fact as a result of the unfair competition. B&P Code §17204; Durrell v. Sharp Healthcare, supra, at 1359. Plaintiffs did not and cannot allege that they suffered an injury-in-fact as a result of Defendants’ conduct. Any damages suffered were not a result of some made up confusion as to the identity of the beneficiary, but were the result of Plaintiffs’ own default under the Loan. Thus, Plaintiff's cause of action fails. H. Plaintiffs’ Cause of Action for Constructive Fraud Fails. A cause of action for constructive fraud must allege four elements: (1) a fiduciary relationship between the plaintiff and defendant, (2) the defendant's breach of his fiduciary duty of disclosure of relevant matters arising from that relationship, (3) fraudulent intent, and (4) reliance, causation, and resulting injury. 5 Witkin, Cal. Proc. 5th (2008) Plead, § 717, p. 133; Younan v. Equifax Inc. (1980) 111 Cal.App.3d 498, 516, fn. 14; see also Civ. Code, § 1573. All allegations concerning fraud “shall be stated with particularity,” Commonwealth Mortgage Assur. Co. v. Superior Court (1989) 211 Cal.App.3d 508, 518; Roberts v. Ball, Hunt, Hart, Brown & Baerwitz (1976) 57 Cal. App.3d 104, 109-110; Shapiro v. Wells Fargo Realty Advisors (1984) 152 Cal. App.3d 467, 479) including constructive fraud; Schauer v. Mandarin Gems of Cal, Inc. (2005) 125 Cal. App.4th 949, 960-61; Sonoma Foods, Inc. v. Sonoma Cheese Factory, LLC, 634 F.Supp.2d. 1009, 1021 (N.D. Cal. 2007). The allegations must be “specific enough to give defendants notice of the particular misconduct which is alleged to constitute the fraud charged so that they can defend against the charge and not just deny that they have done anything wrong.” Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir. 1985). Statements of the time, place and nature of the alleged fraudulent activities are sufficient [/d. at 735], provided the 26 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT i W R I G H T F I N L A Y & ZA K A T T O R N E Y S AT LA W OO 0 NN O N Wn px W N N O N D N D N N N N N N m m mm e m e m p a e m em e d 00 N N n h s W N RL, O V N Y D R A W N R o plaintiff sets forth “what is false or misleading about a statement, and why it is false.” In re GlenFed, Inc., Secs. Litig., 42 F.3d 1541, 1548 (9th Cir. 1994). Further, “constructive fraud comprises all acts, omissions and concealments involving a breach of legal or equitable duty, trust, or confidence, and resulting in damage to another.” Kingsburg Apple Packers, Inc. v. Ballantine Produce Co., Inc., 2011 U.S. Dist. LEXIS 32111, at *23 (E.D. Cal. Mar. 25, 2011), citing Efron v. Kalmanovitz, (1964) 226 Cal.App.2d 546, 559-60. Contrary to these requirements, Plaintiffs utterly fail to allege any facts against Defendants with any specificity or particularity sufficient to find constructive fraud. Furthermore, Plaintiffs’ claim for constructive fraud fails because there is no fiduciary relationship. The rule in California is that: “[A] financial institution owes no duty of care to a borrower when the institution's involvement in the loan transaction does not exceed the...conventional role as a mere lender of money...” Nymark, supra; Price v. Wells Fargo Bank (1989) 213 Cal.App.3d 465, 476. Also, as explained in Baisa v. Indymac Fed. Bank (2009) 2009 U.S. Dist. LEXIS 103444 at *8, plaintiff cannot establish MERS owed a duty of care because plaintiff cites no authority, no assumption of duty by MERS, and no special relationship between MERS and Plaintiffs. California courts have determined that the relationship of a bank-commercial borrower does not constitute a special relationship. Careau & Co. v. Security Pac. Bus. Credit, Inc. (1990) 222 Cal.App.3d 1371, 1399, fn. 25. The court in Kim v. Sumitomo Bank of California upheld the concept that a lender owes no fiduciary duty to a borrower. Kim v. Sumitomo Bank of California, (1993) 17 Cal.App.4th 974. Lenders are not even under any duty to explain the terms of loan documents to borrowers who sign them without reading. Kim, supra, at 981. Furthermore, lenders do not have a duty “to determine the borrower’s ability to repay the loan... The lender’s efforts to determine the creditworthiness and ability to repay by a borrower are for the lender’s protection, not the borrowers.” Spencer v. DHI Mortgage Company, LTD, (2009) 642 F.Supp.2d 1153, 1161. Moreover, it remains murky, at best, as to which acts or omissions Plaintiffs base their claim of constructive fraud, as they fail to actually identify any information that was required to 27 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT [2 W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W OO 00 3 O&O Wn BA W O N N N N N N N N N O N = em e a e a em s m e a o e m e a e a ® N A N wn hk W R N R S VW X N O N D W N = o o be disclosed to them but was not. They similarly fail to identify which was disclosure was materially inaccurate. Plaintiffs also do not bother to identify which defendant is supposedly responsible for which act or omission, preferring to lump them all together. This is not permissible. Hills Transportation Co. v. Southwest Forest Industries, (1968) 266 Cal. App.2d 702, 707-08 (sustaining demurrer to fraud claim for failing to make specific allegations as to when representations were made, by whom, to whom or the manner in which they were made); Shapiro v. Wells Fargo Realty Advisors, (1984) 152 Cal. App.3d 467, 479. I. Plaintiffs’ Fraud in the Concealment and Fraud in the Inducement Claims Fail. The required elements for fraud are: (1) misrepresentation (concealment, false representation, nondisclosure), (2) the defendant intended to defraud the plaintiff, (3) the plaintiff justifiably relied, and (4) plaintiff sustained damage as a result. Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4™ 951, 974. First, Plaintiffs did not, and cannot, allege that Defendants concealed or suppressed any material facts from Plaintiffs. Plaintiffs base their Fraud in the Concealment claim on the supposed concealment of “the fact that the Loans were securitized as well as the terms of the Securitization Agreements... By concealing the securitization, Defendant concealed the fact that Borrower’s loan changed in character...” FAC, § 112. However, securitization does not change a borrower’s obligations under the loan or the relationship of the parties in any way. Logvinov v. Wells Fargo Bank, 2011 U.S.Dist. LEXIS 141988, at *9. Also, the “securitization of mortgage loan does not provide mortgagor with cause of action.” Id. California cases have rejected the argument that nondisclosure of the securitization of a loan could give rise to a viable claim particularly where, as here, the Deed of Trust expressly stated that the loan could be sold one or more times without prior notice to the borrower. See, Deed of Trust § 20, Complaint Exhibit “A” and RIN Exhibit “1.” See, Fontaine v. Bank of Am., N.A., 2015 U.S. Dist. LEXIS 2111 at *11- 13 (S.D. Cal. Jan. 7, 2015). Also, Plaintiffs did not, and cannot, allege that Defendants misrepresented any material facts to Plaintiffs. In the Fraud in the Inducement claim, Plaintiffs claim that “Defendants misrepresented that they are the ‘holder and owner’ of the Note and the beneficiary of the Deed 28 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT i W R I G H T FI NL AY & ZA K“ A T T O R N E Y S AT LA W OO 0 9 A N B W ) = N N R N N N N N N m e m e m e m p m p m p m ea pe XX N N R L Y = O YO N N D A W O N -, o o of Trust.” FAC, § 151. Plaintiffs do not explain how this could be a misrepresentation when the Deed of Trust did designate MERS as the beneficiary as nominee for the lender and the lender’s successors and assigns. (RIN, Exh. 1). Thereafter, the Deed of Trust was assigned to the Trust. (RIN Exh. 2). Nonetheless, as stated above, whether Defendants are “holders” of the note is not material here. Jenkins v. JPMorgan Chase Bank, N.A. (2013) 216 Cal. App.4th 497, 513(disapproved on other grounds by)(“...we find the statutory provisions...do not require that the foreclosing party have an actual beneficial interest in both the promissory note and deed of trust to commence and execute a nonjudicial foreclosure sale.”); Lane v. Vitek Real Estate Group (2010) 713 F.Supp.2d 1092, at 1099 (“There is no stated requirement in California’s non-judicial foreclosure scheme that requires a beneficial interest in the Note to foreclose.”); Castaneda v. Saxon Mortg. Services, Inc. (E.D. Cal. Dec. 3, 2009) 687 F.Supp.2d 1191, 1201. Finally, Plaintiffs fail to establish reliance or damages. Plaintiffs must plead and prove they sustained damage as a result of the concealment or misrepresentation. They have not done SO. J. Plaintiffs Cause of Action for Slander of Title Fails. The elements of Slander of Title are (1) publication; (2) falsity; (3) absence of privilege; (4) and disparagement of another’s land which is relied upon by a third party and which results in pecuniary loss. Witkin, Summary of Cal. Law, (2005), 10™ Ed., § 642. Further, fictional malice or malice implied-in-law from the unprivileged character of the act is required. /d. at 948. Here, Plaintiffs claim that their title was disparaged by Defendants “preparing, posting, publishing and recording. ..the Notice of Default, Notice of Trustee’s Sale, and Trustee’s Deed.” See, FAC, 1 121. First, there is no Trustee’s Deed Upon Sale recorded here. Next, MERS was not involved in the preparing, posting publishing or recording of those documents because MERS had already assigned the Deed of Trust prior to the issuance of the Notice of Default. (RIN Exh. 2, 6). Therefore, this claim fails as to MERS. Nevertheless, the recordation of the foreclosure notices are a mandatory step to non- Judicial foreclosure and required pursuant to Civil Code §2924 et seq.. See, Wilton v. Mountain 29 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT ¥ W R I G H T FI NL AY & ZA K“ A T T O R N E Y S AT LA W OO 0 9 O N wn BA W N DN N N N N N N N N H e s a a e a s a e m e m e a e © N A Ln bh W N H O O ® NN O D T A W N o m o o Wood Homeowners Assn., (1993) 18 Cal. App.4th 565, 570. Therefore, these “publications” would be subject to the absolute privilege under Civil Code §47(b). Kachlon v. Markowitz,(2008) 168 Cal. App.4th 316, 333. Even under the qualified privilege of §47(c), Plaintiffs would need to allege actual malice directed at them, not mere conclusions. Id.; accord Lundquist v. Reusser, (1994) 7 Cal.4th 1193, 1208-10. Here, there are no allegations that Plaintiffs were NOT in default [FAC, generally], and there are no facts that would evidence malice by Defendants. FAC 99 120-127. Thus, Plaintiffs’ baseless conclusions should be disregarded. K. Plaintiffs’ Cause of Action for Quiet Title Against Defendants Fails. Plaintiffs’ cause of action for quiet title fails because Plaintiffs did not verify the complaint, state a legal description of the Property, or provide any adverse claim against Defendants. Code Civ. Proc. § 761.020. Furthermore, MERS’ involvement with the Deed of Trust ended when the Assignment was executed in 2012 [Complaint, Exhibit “B” and RIN, Exhibit “2”] and SPS is merely the servicer of the Loan and has no interest in the Property for its own account. FAC, § 14. As such, neither party has any title to quiet anyway. Finally, Plaintiffs must also allege that they paid any debt owed on the property. See, Sipe v. McKenna (1948) 88 Cal. App.2d 1001, 1006; Shimpones v. Stickney (1934) 219 Cal. 637, 649 (“[A] mortgagor cannot quiet his title against the mortgagee without paying the debt secured”). “A basic requirement of an action to quiet title is an allegation that plaintiffs 'are the rightful owners of the property, i.e., that they have satisfied their obligations under the Deed of Trust’ [Citation.]” Santos v. Countrywide Home Loans (E.D. Cal, Nov. 6, 2009, CIV.20902642WBS DAD) 2009 WL 3756337, *4. Not surprisingly, Plaintiffs fail to allege any facts to suggest that they could or would bring the loan current. L. Plaintiffs’ Twelfth Cause of Action for Declaratory Relief Fails. Plaintiffs’ cause of action fails because it is duplicative of Plaintiffs’ remaining causes of action, all of which fail. An action in declaratory relief will not lie to determine an issue, which can be determined in the underlying action. California Ins. Guarantee Assn. v. Superior Court (1991) 231 Cal.App.3d 1617, 1623. “The object of declaratory relief is to afford a new form of relief where needed and not to furnish the litigant with a second cause of action for the 30 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT determination of identical issues.” Gen. of America Ins. Co. v. Lilly (1968) 258 Cal.App.2d 465, 470. Accordingly, because Plaintiffs’ remaining causes of action, upon which his claim for declaratory relief is predicated, fail, Plaintiffs’ cause of action cannot stand independently and fails. IV. CONCLUSION For the reasons set forth above, Defendants respectfully request that this Court sustain their Demurrer to Plaintiffs’ First Amended Complaint in its entirety without leave to amend. 12 W R I G H T F I N L A Y & ZA K * A T T O R N E Y S AT LA W NO 0 J O N n o b W N 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dated: March 12,2018 /s/Ruby J. Chavez MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT Respectfully submitted, WRIGHT, FINLAY & ZAK, LLP Gwen H. Ribar, Esq. Ruby J. Chavez, Esq. Attorneys for Defendants, SELECT PORTFOLIO SERVICING, INC., MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, and U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, ON BEHALF OF THE HOLDERS OF THE HOME EQUITY ASSET] TRUST 2006-5 HOME EQUITY PASS- THROUGH CERTIFICATES, SERIES 2006-5 31 H W ~~ ON 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PROOF OF SERVICE I, Nancy C. Wheeler, declare as follows: I am employed in the County of Orange, State of California. Iam over the age of eighteen (18) and not a party to the within action. My business address is 4665 MacArthur Court, Suite 200, Newport Beach, California 92660. Iam readily familiar with the practices of Wright, Finlay & Zak, LLP, for collection and processing of correspondence for mailing with the United States Postal Service. Such correspondence is deposited with the United States Postal Service the same day in the ordinary course of business. I am aware that on motion of party served, service is presumed invalid if postal cancellation date or postage meter date is more than one day after date of deposit for mailing in affidavit. On March _/2 , 2018, I served the within NOTICE OF DEMURRER AND DEMURRER OF DEFENDANTS TO PLAINTIFFS’ FIRST AMENDED COMPLAINT; MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF, on all interested parties in this action as follows: [x] by placing [ ] the original [X] a true copy thereof enclosed in sealed envelope(s) addressed as follows: GARY W. GRABLE CAROL H. GRABLE 19462 MISTY RIDGE LANE TRABUCO CANYON, CA 92679 PLAINTIFFS IN PRO PER [X] (BY MAIL SERVICE) I placed such envelope(s) for collection to be mailed on this date following ordinary business practices. [] (BY CERTIFIED MAIL SERVICE) I placed such envelope(s) for collection to be mailed on this date following ordinary business practices, via Certified Mail, Return Receipt Requested. [] (BY PERSONAL SERVICE) I caused personal delivery by ATTORNEY SERVICE of said document(s) to the offices of the addressee(s) as set forth on the attached service list. [] (BY FACSIMILE) The facsimile machine I used, with telephone no. (949) 477-9200, complied with California Rules of Court, Rule 2003, and no error was reported by the machine. Pursuant to California Rules of Court, Rule 2006(d), I caused the machine to print a transmission record of the transmission, a copy of which is attached to the original Proof of Service. [] (BY FEDERAL EXPRESS OVERNIGHT- NEXT DAY DELIVERY) I placed true and correct copies thereof enclosed in a package designated by Federal Express Overnight with the delivery fees provided for. [] (CM/ECEF Electronic Filing) I caused the above document(s) to be transmitted to the office(s) of the addressee(s) listed by electronic mail at the e-mail address(es) set forth above pursuant to Fed.R.Civ.P.5(b)(2)(E). “A Notice of Electronic Filing (NEF) is generated automatically by the ECF system upon completion of an electronic filing. The NEF, when e-mailed to the e-mail address of record in the case, shall constitute the proof of service as required by Fed.R.Civ.P.5(b)(2)(E). A copy of the NEF shall be attached to any document served in the traditional manner upon any party appearing pro se.” PROOF OF SERVICE ~N O N wn Bb 10 11 12 13 14 15 16 17 18 19 20 21 2 23 24 25 26 27 28 [X] (State) I declare under penalty of perjury under the law of the State of California that the foregoing is true and correct. Executed on March /.3 2018, at Newport Beach, California. 0000) Nancy C. Wheeler 2 PROOF OF SERVICE