DR. LEEVIL v. WESTLAKE HEALTH CARE CENTERAppellant’s Opening Brief on the MeritsCal.July 17, 2017Case No. 8241324 IN THE SUPREME COURT OF CALIFORNIA WESTLAKE HEALTH CARE CENTER, SUPREME COURT Defendant-Petitioner and Appellant, FILED v. JUL 17 2017 DR. LEEVIL, LLC, Jorge Navarrete Clerk Plaintiff-Respondent. Deputy After a Decision of the Court of Appeal Second Appellate District, Division Six Court of Appeal No. B266931 Superior Court, County of Ventura Case No.: 56-2015-00465793-CU-UD- VTA The Honorable Vincent J. O’Neill, Jr. PETITIONER’S OPENING BRIEF *Teri T. Pham, Esq. (SBN 193383) tpham@enensteinlaw.com Courtney M. Havens, Esq. (SBN 301116) chavens@enensteinlaw.com ENENSTEIN RIBAKOFF LAVINA & PHAM 12121 Wilshire Boulevard, Suite 600 Los Angeles, California 90025 Telephone: (310) 899-2070 Fax: (310) 496-1930 Attorneys for Defendant-Petitioner and Appellant Westlake Health Care Center Case No. 8241324 IN THE SUPREME COURT OF CALIFORNIA WESTLAKE HEALTH CARE CENTER, Defendant-Petitioner and Appellant, V. DR. LEEVIL, LLC, Plaintiff-Respondent. After a Decision of the Court of Appeal Second Appellate District,Division Six Court of Appeal No. B266931 Superior Court, County of Ventura Case No.: 56-2015-00465793-CU-UD- VTA The Honorable Vincent J. O’Neill, Jr. PETITIONER’S OPENING BRIEF *Teri T. Pham, Esq. (SBN 193383) tpham@enensteinlaw.com Courtney M. Havens, Esq. (SBN 301116) chavens@enensteinlaw.com ENENSTEIN RIBAKOFF LAVINA & PHAM 12121 Wilshire Boulevard, Suite 600 Los Angeles, California 90025 Telephone: (310) 899-2070 Fax: (310) 496-1930 Attorneys for Defendant-Petitioner and Appellant Westlake Health Care Center Table of Contents I. ISSUES ON WHICH APPEAL HAS BEEN GRANTED........... 1 Il. INTRODUCTION AND STATEMENTOF THE CASE............ 1 TH. SUMMARYOF FACTS2000... cccceccceccescesseeeseceeesseeeseeseseeseeeeeeeese 4 TV. PROCEDURAL HISTORY.......ccccecccscccesseeeeeeeeeeecesesersneeeeeeeess 5 V. LEGAL ARGUMENT..........ccccscesesseeeseceseeecteceeneeeseeaeenaeeeseeeeseteas 8 A. The Summary Remedy Provided by the Unlawful Detainer Statutes Requires Strict Compliance...cee eeeeseeeeeeeeeeeeseeeeseees 8 - B. Code of Civil Procedure Section 1161a Requires That Title Be Duly Perfected at the Timethe Notice to Quit Is Served........ 9 C. Section 2924h(c) Does Not Excuse Compliance With Section D161 a ee eeesssesseseeessseteeceseetecesneeeesesssneeensneeseesseccecsnnsnneees seteseeneeeee 12 CONCLUSION.........eesacseeesesaessessesessescsesseaceseeaseasecesseseesesesseseeasseeseeaes 15 CERTIFICATE OF WORD COUNT........cccccceessessseesceeeeneceseeeesseeeneeeasenees 16 li TABLE OF AUTHORITIES Cases Bank ofNew York Mellon v. Preciado 224 Cal. App. 4th Supp. 1, 9-10 (2013)...eeceesecceneeeeeeeeeeeteaeeeneeeeeees 10 Baugh v. Consumers Associates, Limited, 241 Cal.App.2d 672, 674-75 (1966) 0... eceessesseeeseeeeeseeeeceeeeeeeeeeeseseeteeaes 8 Borsuk v. Appellate Division ofthe Superior Court, 242 Cal. App. 4th 607, 609-10 fn. 1 (2015) csocssccscssessesseseesee beceeeeees 8, 12 Culver Cir. Partners E. No. 1, L.P. v. Baja Fresh Westlake Vill, Inc., 185 Cal. App. 4th 744, 749 (2010) cecsccscsccssssessssevssssessssssessssessseseseesessese 8 Dr. Leevil, LLC v. Westlake Health Care Center, 9 Cal. App. 5th 450, 457 (2017) .......eeeweceesneceeaeeesseseeeaeeneeeues 3,7, 12° - Horton-Howardv. Payton, 44 Cal.App. 108, 112 (1919) oooceceeeseesseeeceseeesesseesseeeseesseeeessessaeeeses 8 Ion Equip. Corp. v. Nelson, 110 Cal. App. 3d 868, 877 (1980).....ceeeceecceeceeeeceeeeceeeeeeeseeseeeeseseeeeeeeaes 5 Lacrabere v. West, 141 Cal. 554 (1904) ooocecceccesseescesseeeseneeceeeessneesesaeessetessssesesseeseeessaes 8 Lucas v. County ofLos Angeles, A7 Cal. App. 4th 277, 284- 285 (1996) .....ceeceecceeseecceseeesneteeeeeseeenseesaeeeees 6 Opera House Ass'n v. Bert, 52 Cal. 471 (1877) oo. ceceeccecesscceeseessseseeceeeseesaceeseececesceeeseeeereceetesseeeneensaes 8 Rankin v. Superior Court, 157 Cal. 189, 106 P. 718 (1910) ooeceeeeeeeceseeeeeeseceesseeeeeeceseeeeesteeeesaes 8 Savings & L. Soc. v. McKoon, 120 Cal. 179 (1898) oooeee cecsceceeceseecesaeesseeceeeecseeeeeeeseneeeeseaeeeseeeseeetesensaes 8 lil Smify v. Citibank (South Dakota) N.A., 11 Cal. 4th 138, 145 (1995) oo... eeeeeeseececeesseeeeseeseseeetseseeseseeseteseessees 5, 6 Stephens, Partain & Cunningham v. Hollis, 196 Cal. App. 3d 948, 952-53 (1987) ....ececeeecccesssessessssseessesseeseecsseeeeaee 10 Stoops v. Abbasi, 100 Cal. App. 4th 644, 650 (2002)... ceccccccesseceseeseeseseseeeseeteesssaeenseees 5 U.S. Financial, L.P. v. McLitus, 6 Cal. App. 5th Supp. 1 (Cal. App. Dep't Super. Ct. 2016)......000.. passim Statutes California Code of Civil Procedure: - §§ 1161/1 16 1a(b)(3) oonsecscesssscceceernseeesssessnnssseeseestenseesnseeeunnseeenunassees 5, 6 § LOD Accccccseeesseeneeee sessesensnnnnnnnnseteeeeseeesnnseeenaseee 1-3,7, 9, 11, 12, 14 § 116 1.a(b) esscsessessecesssseeesssseeeeessseseeesessseennesssseesnseeeseeneete vesseeetee 14 § 116 1a(b)(3) ooesecessesssseessesssseecessesesnssssesessseeeseesuesstetnseeennseesiansssee 6,9 § 2924 oa ceecssssessssestscssssestesssceceesennesenseeseneaseeeesssuenetesneeeennseetie 2,9, 11 § 2924N oe ecsecscsssessscsnssestenssseceeeessseesnssesvnnnseesseesnnnsseenesesanseesenasee 2, 10 § 292AN(C) oceesessesseesssseeessessseesesseetnsnsenessssssetinnnunnenseeseeseeeenneseeeeee 12, 14 iv I. ISSUES ON WHICH APPEAL HAS BEEN GRANTED Pursuantto the California Supreme Court’s June 14, 2017 Order, the issue to be briefed and argued is: “Does Code of Civil Procedure section 116la require a purchaserofreal property at a foreclosuresale to perfect title before serving a three-day notice to quit on the occupantofthe property?” I. INTRODUCTION AND STATEMENTOF THE CASE This appeal arises from a Judgment entered in an unlawful detainer action concerning a 99-bed skilled nursing facility located in Thousand Oaks, California (the “Premises”). Defendant-Petitioner and Appellant Westlake Health Care Center (“Petitioner”) is the former tenant and former licensed operatorofthat facility. In early 2015, Respondent Dr. Leevil, LLC (“Respondent”), the holder of a loan secured by the Premises, foreclosed on the Premises and subsequently purchased the Premises at a non-judicial foreclosure sale on February 19, 2015. The next day, on February 20, 2015, before the trustee’s deed upon sale was even recorded, Respondent purported to serve a three-day notice to quit on Petitioner, as well as, on “ALL OTHER OCCUPANTS”(the “Notice to Quit”). Respondent thereafter filed the underlying unlawful detainer action alleging that it was entitled to possession of the Premises based on that Notice to Quit. Only oneissue from that unlawful detainer actionis at issue in this appeal: “Does Code of Civil Procedure section 1161a require a purchaser of real property at a foreclosure sale to perfect title before serving a three-day notice to quit on the occupant of the property?” Code of Procedure section 1161a states in pertinentpart: (b) In any of the following cases, a person whoholds over and continues in possession of a manufactured home, mobilehome, floating home, or real property after a three-day written notice to quit the property has been served upon the person, or if there is a subtenant in actual occupation of the premises, also upon such subtenant, as prescribed in Section 1162, may be removedtherefrom asprescribed in this chapter: [...] (3) Where the property has been sold in accordance with Section 2924 of the Civil Code, under a powerof sale contained in a deed of trust executed by such person, or a person under whom such person claims, and thetitle under the sale has been duly perfected.” (Emphasis added). Petitioner argued below that the Complaint for unlawful detainer was fatally defective as title had not been “duly perfected”as required by CodeofCivil Procedure! section 1161a at the time the Notice to Quit wasallegedly served. The Notice to Quit wastherefore premature andinvalid. Because California law requires strict compliance with the statutory requirements for an unlawful detainer action, Respondent’s failure to perfect title before service of the Notice to Quit unlawful detainer action rendered the complaint for unlawful detainer improper. Thetrial court rejected Petitioner’s argument and determined that pursuant to Code of Civil Procedure 2924h, which governs procedures at foreclosure sales, title was perfected as of the date of the foreclosure sale on February 19, 2017. After stipulation by the parties on several remaining issues, Judgment was entered on July 22, 2015. PM ER E T | ' Unless otherwise stated, all statutory references herein will refer to the California statutes. Petitioner appealed the trial court’s decision, citing, among otherissues, that the Notice to Quit was premature and invalid. After oral argument and while the matter was under submission in the Court ofAppeal, this Court ordered publication of the matter entitled U.S. Financial, L.P. v. McLitus, 6 Cal. App. 5th Supp. 1 (Cal. App. Dep't Super. Ct. 2016), as amended (Dec. 2, 2016) (“McLitus”). McLitus, which was factually similar to the case at hand, held that duly perfected title under Code of Procedure 1161a is a prerequisite to service of the three day notice to quit in an unlawful detaineraction. . Despite requesting supplemental briefing by the parties regarding the issue in light of the McLitus decision, the Appellate Court ultimately disagreed with the McLitus decision, holding that Code of Civil Procedure section 1161a does not require thattitle be recorded before a notice to quit is served, but rather “Becausetitle was perfected before the complaint wasfiled, the unlawful detainer proceedings were valid. To conclude otherwise, we would have to rewrite section 1 161a, subdivision (b)(3) to add the requirementthat title be perfected before the notice to quit is served.” Dr. Leevil, LLCv. Westlake Health Care Center, 9 Cal. App. Sth 450, 457 (2017) (“Dr. Leevil’”). This Court thereafter granted review. As discussed below,a plain reading of Code of Civil Procedure section 1161a and application of California’s policy of strict compliance in order to obtain the benefits of the summary unlawful detainer remedy requirestitle be perfected before the service of a three-day notice to quit. Petitioner therefore respectfully requests that this Court reverse the lower courts’ rulings on this issue and direct thetrial court to enter Judgmentin favor of Petitioner. Til. SUMMARYOF FACTS Prior to entry of Judgmentin this action, Petitioner was the licensed operator and tenant of a 99-bed residential care facility located on the Premises. (2AA at T49 402 92.”) Petitioner operated the facility under a licensed granted by the State of California. (2AA at T49 402 42.) Until February 2015, the Premises was owned by nonparty Westlake Village Property L.P. (“Westlake L.P.””). On March 12, 2002, Petitioner entered into a written Lease with Westlake L.P. pursuant to which Petitioner leased the Premises from Westlake L.P. for aterm of 20 years. (2AA at T37 301-307.) | In 2008, the property owner, Westlake L.P., obtained a loan from TomatoBank, N.A.(the “Bank”) to refinance the property. (LAAat T23 135- 37.) The loan thereafter matured and Westlake L.P. defaulted. __ In 2014, the Bank sold the loan to Respondent Dr. Leevil, LLC. (LAA at T23 149-52.) Respondent subsequently foreclosed on the loan via the power of sale contained in the Deed of Trust. (LAA at T2 11-12.) On February 19, 2015, Respondent proceeded with a non-judicial foreclosure sale and purchased the Premisesvia a trustee’s deed upon sale. (LAA at T2 11-12.) Thetrustee’s deed upon sale was not recorded until 6 days later on February 25,2015. (1AA at T2 11.) On February 20, 2015, the day after the foreclosure sale but before the trustee’s deed wasofficially recorded, Respondent purported to serve a three- ? Citations to Appellant’s Appendixshall bein the following format: ([Volume]AA at T[tab number] [page number].) day notice to quit on Petitioner (“Notice to Quit”). (AA at T23 154-57.) The Notice to Quit was signed by “Ronald Richards, Esq.” without any identification of Respondent whatsoeveror any indication of in what capacity Mr.Richards was acting. (/d.) Respondent thereafter commencedthe underlying unlawful detainer action on April 1, 2015. (1AA at T2 9.) IV. PROCEDURAL HISTORY— On April 1, 2015, Respondent filed a Complaint for Unlawful Detainer after Completion of Power of Sale from a Foreclosure by a Trustee’s Deed (“Complaint”). (1AA at T2 9.) On the caption page of the Complaint, Respondent cites “CCP §§ 1161/1161a(b)(3)”and states thatit is an “Action Based on Codeof Civil Procedure Section1 16la.” (IAA at T2 11.) The Complaint alleged that Respondent “acquiredtitle on February 19, 2015 via a trustee's deed upon sale recorded on February 25, 2015. The trustee's deed upon sale granted, plaintiff a 100% ownership interest. Title has been duly perfected.” (1AA at T2 11.) After a demurrer, Petitioner filed its Answer on April 30, 2015. (LAA at T17 99.) The case was ultimately set for trial on July 15, 2015. QAA at T36 289.) Pursuant to the trial court’s order, on July 1, 2015 and July 2, 2015, Petitioner timely filed five motions in /imine, including a Motion in Limine No.1 for Judgment on the Pleadings.*? (LAA at T23 119; 1AA at T24 163; 3A motion for judgment on the pleadings may be madeat anytimeeither priorto the trial or at the trial itself.” Stoops v. Abbasi, 100 Cal. App. 4th 644, 650 (2002) (citing Jon Equip. Corp. v. Nelson, 110 Cal. App. 3d 868, 877 (1980)); see also Smify v. Citibank (South Dakota) N.A., 11 Cal. 4th 138, 145 5 LAA at T25 168; 1AA at T26 207; 1AA at T29 222.) The Motion for Judgment on the Pleadings argued that, among other issues, Respondent did not properly serve its Notice to Quit under California Code of Civil Procedure section 1161a(b)(3), as it had not perfected title at the time it served the Notice to Quit. (LAA at T29 222-23.) Respondent opposed the Motion for Judgment on the Pleadings arguing that title was deemed perfected as of the date of the sale under section 2924h(3) because the trustees’ deed upon sale was recorded within 15 days of the sale. (LAA at T32 235-36.) On July 20, 2015, the trial court heard the Motion for Judgment on the Pleadings. Thetrial court ruled that the deed was “deemed recorded as a matter of law.” (RT 59:7-17.) The trial court immediately thereafter held a benchtrial and summarily adjudicated the matter in favor of the Respondent. The remaining issues after the benchtrial were resolved pursuantto stipulation, and Judgment was entered by thetrial court in favor of Respondent.* (RT 155:8-156:26.) | The Notice of Entry of Judgment wasfiled on July 21, 2015, and was entered onto the docket on July 22, 2015.(AA at T1 1; 2AA at T45 354.) On September 16, 2015, Petitioner filed its notice of appeal to the Court of Appeal, Second Appellate District (“Appellate Court”). (2AA at T46 358.) Petitioner filed its opening brief with the Appellate Court on April 12, 2016 and Respondentfiled its brief on July 14, 2016. Oral argument before the Appellate (1995). As such, it is established that a motion for judgment on the pleadings (“MJOP”) can also be madein limine. Lucas v. County ofLos Angeles, 47 Cal. App.4th 277, 284- 285 (1996). This is due to the fact that courts have inherent powerto controllitigation and conserve judicial resources through whatever procedural vehicle reachesthat result. /d. ‘ Bystipulation of the parties, enforcement of the Judgmentwas stayed until September 14, 2015. (Id.) Court was heard on November 9, 2016, and the matter was taken under submission. On December5, 2016, after Oral Argument, the Appellate Court ordered that the submission be vacated for further briefing. Specifically, the Court ofAppeal requested “letter briefs on U.S. Financial, L.P. etc., v. McLitus, San Diego County Superior Court, Appeal Division (Case No. 37- 2016-00201 1 16-CL-UD-CTL), ordered published by the California Supreme Court on December2, 2016 (S237852).” (See Order Vacating Submission and Order For Supplemental Letter Briefs, dated December 5, 2016.) The parties subsequently submitted the requested letter briefs regarding McLitus. There wasno further oral argument on the McLitus issue. | The Appellate Court issued its Order on March 7, 2017, affirming the judgment in favor of Respondents. Dr. Leevil at 457. On the issue of the validity of the Notice to Quit, the Appellate Court departed from the reasoning ofthetrial court, but nonetheless rejected the arguments raised by Petitioners on appeal and the decision by the McLitus court. The Appellate Court held that while perfectedtitle is required prior to service of the complaint, perfected title is not required prior to service of a three-day notice to quit. Dr. Leevil at 456-57. This Court granted Petitioner’s Petition for Review on June 14, 2017, solely as to the issue of whether Code of Civil Procedure section 11l6la requires a purchaserofreal property at a foreclosure sale to perfect title before serving a three-day notice to quit on the occupantofthe property. V. LEGAL ARGUMENT A. The Summary Remedy Provided by the Unlawful Detainer Statutes Requires Strict Compliance As a preliminary matter, it is well-established under California law that in order to take advantage of the summary remedy of unlawful detainer, a “landlord must demonstratestrict compliance with the statutory notice requirements contained in section 1161 et seq.” Culver Ctr. Partners E. No. 1, LP. v. Baja Fresh Westlake Vill., Inc., 185 Cal. App. 4th 744, 749 (2010) (“Culver Ctr. Partners’) (denying unlawful detainer remedy whereservice of notice to quit was not proper even though defendant had actual notice); accord Borsuk v. Appellate Division ofthe Superior Court, 242 Cal. App. 4th 607, 609-10 fn. 1 (2015). “The remedy of unlawful detainer is a summary proceeding to determine the right to possession of real property. Sinceit is purely statutory in nature,it is essential that a party seeking the remedy bring himself clearly within the statute.” Baugh v. Consumers Associates, Limited, 241 Cal.App.2d 672, 674-75 (1966)citing Rankin v. Superior Court, 157 Cal. 189, 106 P. 718 (1910). Indeed, California law has long held that “forfeitures are not favored by the courts; every intendment and presumption is against the person seeking to enforce the forfeiture; statutes creating forfeitures must be strictly construed; and one whoseeks the summary remedyofunlawful detainer allowed bythe statute must bring himself clearly within its terms.” Horton-Howard v. Payton, 44 Cal.App. 108, 112 (1919) citing Savings & L. Soc. v. McKoon, 120 Cal. 179 (1898); Opera House Ass'n v. Bert, 52 Cal. 471 (1877); Lacrabere v. West, 141 Cal. 554 (1904). Without adherence to the strict requirements of the unlawful detainer statutes, including Code of Civil Procedure section 1161a, a landlord’s remedy is simply an ordinary suit for breach of contract, with all the according delays. Culver Ctr. Partners at 750. Taking into account the requirementfor strict compliance with the unlawful detainer statutes and strict construction of such statutes, as discussed below, Respondent’s failure to record its trustee’s deed uponsale prior to service of the Notice to Quit rendered the Notice to Quit invalid and the unlawful detainer complaint defective as a matter of law. The lower courts therefore erred in finding in favor of the Respondent on this issue, and the Judgment should be reversed. B. Code of Civil Procedure Section 1161a Requires That Title Be Duly Perfected at the Time the Notice to Quit Is Served Code of Civil Procedure section 1161a, the governing statute upon which Respondentbased its unlawful detainer action and under whichit served the Notice to Quit, provides in pertinent part: | (b) In any of the following cases, a person who holds over and continues in possession of a manufactured home, mobilehome, floating home, or real property after a three-day "written notice to quit the property has been served upon the person, or if there is a subtenant in actual occupation of the premises, also upon such subtenant, as prescribed in Section 1162, may be removed therefrom as prescribed in this chapter: (3) Where the property has been sold in accordance with Section 2924 of the Civil Code, under a power of sale contained in a deed of trust executed by such person, or a person under whomsuchperson claims, andthe title under the sale has been duly perfected. Code of Civ. Proc. §1161a(b)(3) (emphasis added). Contrary to the ruling of the Appellate Court, requiring goodrecord title prior to the service of the notice to quit is not “rewriting” section 1161a. The statute is clear in the series of required events. First, the circumstancesdescribed in subsection 1161a(b)(3) must take place, i.e. the property must be sold pursuant to Section 2924h andtitle under the sale must 9 be duly perfected title. Second, the three day notice to quit must be validly served. Then, and only then, the new ownerofthe property may avail themselves of the unlawful detainer statutes in order to evict the holdover occupant. Indeed,the statute is clear that eviction may only occur where there has been a sale pursuant to section 2924h andtitle underthe sale has been duly perfected. The sale and duly perfected title are required conditions before a holdovertenant can be evicted and notice to quit may be given. Duly perfectedtitle includes, but is not limited to, good recordtitle. “[T]itle is duly perfected when all steps have been taken to makeit perfect, i.e., to convey to the purchaser that which he has purchased, valid and good beyond all reasonable doubt, which includes goodrecordtitle, but is not limited to good recordtitle, as between the parties to the transaction. The term ‘duly’ implies that all of those elements necessary to a valid sale exist, else there would notbe a sale atall.” Bank ofNew York Mellon v. Preciado, 224 Cal. App. 4th Supp. 1, 9-10 (2013) (emphasis added) (citing Kessler v. Bridge, 161 - Cal. App. 2d Supp. 837, 841 (1958)); accord Stephens, Partain & Cunningham v. Hollis, 196 Cal. App. 3d 948, 952-53 (1987). The facts here are not disputed, and are a matter ofjudicial admission by Respondent. Respondentalleged in its Complaint that it purchased the property at the foreclosure sale on February 19, 2015, and that it served its Notice to Quit on February 20, 2015. (LAA at T2 12.) However, Respondent admitted in that same Complaintthat title was not recorded until February 25, 2015. (LAA at T2 11.) Therefore, at the time Respondent purportedto giveits Notice to Quit, title had not been perfected, as it had not yet been recorded. The Notice to Quit was therefore defective and premature, and the unlawful detainer action was improper. 10 For these reasons, the Appellate Court’s determination that 1161a only requires perfect title prior to filing of the complaint is incorrect. As the McLitus court explained,the strict requirement thattitle must be recorded prior to serving the Notice to Quit makes sense, as without goodrecordtitle, a tenant would have no wayofverifying who is the ownerof record: A defective notice cannot support an unlawful detainer judgment for possession. Respondent’s interpretation, on the other hand, would suggest that a post-foreclosure plaintiff could routinely prematurely issue a three-day notice that includes legal and factual misstatements (e.g., that the purchaser has already duly perfected title when it had not yet done so). And as argued by Appellant, such a practice would practically prevent a defendant from effectively verifying the identity of the alleged ‘purchaserof a property as a search of recorded documents would prove futile. . Absenta sale in accordance with Section 2924 of the Civil Code and a duly perfectedtitle prior to the issuanceofthe notice, a post-foreclosure purchaser cannot avail itself of a summary unlawful detainer eviction proceeding. Respondent’s prematurely issued notice was fatally defective, and the unlawful detainer judgment mustbe reversed. McLitus, 211 Cal. Rptr. 3d at 151-52. Indeed, under the Appellate Court’s interpretation, a Notice to Quit could arguably be served even prior to the foreclosure sale itself, so long asit is prior to the service of the unlawful detainer complaint. Such a construction certainly cannot be what wasintended bythe legislature and violates the paramountprinciples under California law that unlawful detainer statutes are to be strictly complied with and strictly construed. Without perfectedtitle, the tenant cannot know whetheror not the notice to quit is from the correct ownerofthe property, or to whom it should validly surrender possession or pay. This is particularly true here, as the Notice to Quit did not even identify the purported new ownerof record. 11 Moreover, the notice period set forth in Respondent’s Notice to Quit expired before Respondent’s title had even been perfected. Petitioner therefore could not even verify the correct ownerofthe property in the county recordsin the time given. As acknowledged by the Appellate Court, “[s]ervice of the notice to quit is an elementofthe {unlawful detainer] action that must be alleged in the complaint and provenattrial.” Dr. Leevil at (citing Borsuk v. Appellate Division ofthe Superior Court, 242 Cal. App. 4th 607, 612-13 (2015)). Construing the statutes to require perfected title prior to service of a notice to quit would therefore be in accordance with the requirements that unlawful detainer statutes bestrictly construedto avoid forfeiture. The McLitus decision should be affirmed and the Judgmentin the underlying action should accordingly be reversed. C. Section 2924h(c) Does Not Excuse Compliance With Section 116la Althoughthe Appellate Court below did not baseits decision on Section 2924h(c), it is. worth noting that Section 2924h(c) also does not support Respondent’s arguments. As discussed above, Respondent arguedin its opposition to the motion for judgment on the pleadings that “Pursuant to Civil Code, section 2924h(c), for title obtained by trustee sale under a powerofsale in a deedoftrust, title is perfected as of the date of the trustee sale so long as the trustee’s deed upon sale is recorded within 15 days ofthe sale, which it was here.” (LAA at T32 234.) This argument was expressly rejected by the McLitus court, and the Appellate Court apparently was not swayed by the argumenteither. Indeed, section 2924h(c) is clear that it applies only for purposesofthat particular subdivision: “For the purposes ofthis subdivision,the trustee's sale shall be deemedfinal upon the acceptance of the last and highest bid, and shall 12 “b e. be deemed perfected as of 8 a.m. on the actual date of sale if the trustee's deed is recorded within 15 calendar daysafter the sale...” Moreover, by its very terms the statute applies to the sale and not title to the property. As the McLitus court aptly explained: In this case, the sale was perfected at the time the three-day notice wasserved, but not the title. Thus, the plaintiff could not provide defendant with a valid three-day notice. The court below mixed the issues of sale and title, but perfecting title is not interchangeable with perfection of the sale under this statutory scheme. McLitus, 211 Cal. Rptr. 3d at 151. In fact, contrary to Respondent’s arguments below,a reviewofthe full text of subdivision (c) confirms thatthe provision applies only to the foreclosure sale and notthe fitle to the property: (c) In the event the trustee accepts a check drawn by a credit union or a savings and loan association pursuant to this subdivision or a cash equivalent designated in the notice ofsale, the trustee may withhold the issuanceofthe trustee's deed to the successful bidder submitting the check drawn by a state or federal credit union or savings and loan association or the cash equivalent until funds become available to the payee or endorsee " as a matter of right. For the purposesof this subdivision, the trustee's sale shall be deemed final upon the acceptance ofthe last and highest bid, and shall be deemed perfected as of 8 a.m. on the actual date of sale if the trustee's deed is recorded within 15 calendar days after the sale, or the next business day following the 15th day if the county recorder in which the property is located is closed on the 15th day. However,the sale is subject to an automatic rescission for a failure of consideration in the event the funds are not “available for withdrawal” as defined in Section 12413.1 of the Insurance Code. The trustee shall send a notice of rescission for a failure of consideration to the last and highest bidder submitting the check or alternative instrument, if the address of the last and highest bidder is knownto thetrustee. 13 If a sale results in an automatic right of rescission for failure of consideration pursuant to this subdivision, the interest of any lienholder shall be reinstated in the samepriority as if the previoussale had not occurred. Code of Civ. Proc. 2924h(c). Thus, subdivision (c) makesclear that the purpose ofthe statute is to make conclusive the date of the foreclosure sale even if the funds are not immediately available so long as recording occurs within 15 days. The statute is limited to that provision and has no bearing on any otherprovision in the Code, andcertainly not on the provisions of Section 1161a.° As Respondentfailed to duly perfect title prior to service of the Notice _ to Quit, its Complaint was fatally flawed. Thetrial court accordingly erred in awarding Judgmentin favor of Respondent, and the Judgment should be reversed. M/ /H/ /// HI // /// Hl >It is also worth noting that perfected title is required underall five scenarios under section 1161a(b) and not just upon a foreclosure sale under Section 2924(c). 14 VI. CONCLUSION Forall the foregoing reasons, Petitioner respectfully requests that the Supreme Court reverse thetrial court’s July 20, 2015 ruling andresulting Judgment thereon, and direct that Judgment be entered in favor ofPetitioner, and/or remand the matter for further consideration. Dated: July 14, 2017 Respectfully submitted, ENENSTEIN RIBABKOFF LAVINA & PHAM OB. Teri T. Pham, Esq. Courtney M. Havens, Esq. Attorneys for Petitioner By: 15 CERTIFICATE OF WORD COUNT Cal. Rule of Court 8.520 Pursuant to California Rule of Court 8.520, I certify that the foregoing Petition for Review was produced on a computer and, according to the word count of the computer program used to prepare the brief, contains 4,639 words. Dated: July 14, 2017 OB. Teri T. Pham 16 PROOF OF SERVICE STATE OF CALIFORNIA, LOS ANGELES COUNTY I reside in Los Angeles County in the State of California. I am over the age of 18. I am nota party to this action. My business address is 12121 Wilshire Boulevard, Suite 600, Los Angeles, California 90025. On July 14, 2017, I served the foregoing document described as: PETITIONER’S OPENING BRIEFon the interested parties in this action addressed below: Geoffrey S. Long, Esq. Office of the Clerk L/O of Geoffrey Long APC Ventura County Superior Court 1601 N. Sepulveda Blvd., No. 729 Hall of Justice Manhattan Beach, CA 90266 800 S. Victoria Avenue Attorneys for Respondent/Plaintiff Ventura, California 93009 -Dr. Leevil, LLC ; Attn: The Honorable Vincent J. O’Neill, Jr. Ronald N. Richards, Esq. so L/O Ronald Richards & Assoc..,- Office of the Clerk APC _ 284 District Court of Appeal P.O. Box 11480 Division 6, Court Place Beverly Hills, California 90213 200 East Santa Clara Street Attomeys for Respondent/Plaintiff Ventura, California 93001 Dr. Leevil, LLC rx] BY UNITED STATES MAIL:I placed true copyofthe documentin separate, sealed envelopes addressed to the parties named above, with prepaid postage, in the U.S. mail in Los Angeles, California. I am "readily familiar" with the firm's practice of collection and processing correspondence for mailing. It is deposited with the United States Postal Service on that same day in the ordinary course of business. I declare under penalty of perjury under the lawsofthe State of California that the aboveis true and correct. Executed this 14day of July, 2017 at Los eles, California. “WANCY TORRECILLAS 17
