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BofA Judge Still Resists Erasing ‘Heartless’ Foreclosure Ruling

BofA Judge Still Resists Erasing ‘Heartless’ Foreclosure Ruling

Bloomberg-

A judge who imposed a $45 million penalty on Bank of America Corp. over a foreclosure on a California couple still isn’t ready to forget the case he described as a “Kafkaesque nightmare.”

U.S. Bankruptcy Judge Christopher Klein voiced exasperation Wednesday as the bank sought for the third time to win his approval of a confidential settlement that would nix the monetary penalty and also erase the 107-page ruling he issued in March detailing the bank’s “callous” and “cruel” treatment of the Sundquist family after they sought a mortgage modification.

Klein asked the bank’s attorney at a hearing in Sacramento: “Are you representing, ‘Oh, judge, we just get to erase the record whenever we want?” The judge said it looked to him like the bank was “holding the Sundquists hostage” by making the settlement contingent on the ruling being dismissed.

[BLOOMBERG]

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TFH 10/22 | Special Seventh Year Anniversary Show Foreclosure Workshops #49 and #50:  Wells Fargo Bank v. Erum — When Is a “Notice of Default” a Notice of Default and When Is It Not?  Nationstar Mortgage v. Akepa Properties — When Is a Foreclosing Plaintiff’s “Lack of Standing” a Jurisdictional Defect and When Is It Not?

TFH 10/22 | Special Seventh Year Anniversary Show Foreclosure Workshops #49 and #50: Wells Fargo Bank v. Erum — When Is a “Notice of Default” a Notice of Default and When Is It Not? Nationstar Mortgage v. Akepa Properties — When Is a Foreclosing Plaintiff’s “Lack of Standing” a Jurisdictional Defect and When Is It Not?

COMING TO YOU LIVE DIRECTLY FROM THE DUBIN LAW OFFICES AT HARBOR COURT, DOWNTOWN HONOLULU, HAWAII

LISTEN TO KHVH-AM (830 ON THE AM RADIO DIAL)

ALSO AVAILABLE ON KHVH-AM ON THE iHEART APP ON THE INTERNET

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Sunday – October 22

 ———————
Special Seventh Year Anniversary Show
Foreclosure Workshops #49 and #50:

Wells Fargo Bank v. Erum — When Is a “Notice of Default” a Notice of Default and When Is It Not?

Nationstar Mortgage v. Akepa Properties — When Is a Foreclosing Plaintiff’s “Lack of Standing” a Jurisdictional Defect and When Is It Not?

 

 

For too long most of our courts have cavalierly discriminated against homeowners by consciously or otherwise going out of their way to protect foreclosing plaintiffs, applying legal doctrines against mortgagors differently than in other areas of the law.

On today’s Seventh Anniversary Show, we will examine two such major areas of discrimination, the first involving the treatment of default notices, and the second the treatment of standing defects.

While progress is being made in our courts opposing such discrimination against homeowners, it will never end until more “Rosa Parks” among homeowners stand up and refuse to go to the back of the bus, as it were, and join together to protect their legal, often constitutional rights, still continuing to be too often thoughtlessly abused.

On today’s show, join John and me and learn how such discrimination is playing out in two important foreclosure defense areas on our Seventh Anniversary Show, as we begin our eighth year on KHVH AM Radio, beginning as weekly guests with our clients on the Rick Hamada Show in 2010, eventually hosting our own Foreclosure Hour on KHVH AM Radio and nationally on iHeart Radio for the past four years.

Listen to today’s show, posted on our website at www.foreclosurehour.com, and find out how you can change American history, beat the banks, by joining the Homeowners SuperPAC today.

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Host: Gary Dubin Co-Host: John Waihee

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CALL IN AT (808) 521-8383 OR TOLL FREE (888) 565-8383

Have your questions answered on the air.

Submit questions to info@foreclosurehour.com

The Foreclosure Hour is a public service of the Dubin Law Offices

Past Broadcasts

EVERY SUNDAY
3:00 PM HAWAII
6:00 PM PACIFIC
9:00 PM EASTERN
ON KHVH-AM
(830 ON THE DIAL)
AND ON
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The Foreclosure Hour 12

 

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



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California, Ohio Extend Sanctions Against Wells Fargo Bank

California, Ohio Extend Sanctions Against Wells Fargo Bank

Corporate Counsel-

California State Treasurer John Chiang said he has decided to extend his state’s financial sanctions against Wells Fargo & Co. into a second year, while Ohio extended its sanctions another six months.

At least four other states and three cities also suspended their governments’ business with Wells Fargo. So far only California and Ohio have extended their suspensions, according to bank spokesman Gabriel Boehmer.

Chiang imposed the ban against doing state Treasury business with Wells Fargo last October after it was revealed the bank had set up millions of fake accounts without customers’ knowledge.

[CORPORATE COUNSEL]

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How Banks Undermined Federal Foreclosure Assistance

How Banks Undermined Federal Foreclosure Assistance

Obama’s 2009 mortgage-modification program would have helped 70% more homeowners if lenders had been better organized.

Stanford Graduate School of Business-

In early 2009, in the depths of the mortgage meltdown, President Barack Obama launched a multi-billion-dollar effort to stem the flood of home foreclosures.

It was called the Home Affordable Modification Program (HAMP), and it aimed to help families keep their homes by offering incentives to banks and loan-servicing companies that modified mortgages of troubled borrowers.

The idea was to correct what economists call a “market failure,” because foreclosures can be a losing proposition for everybody involved. Not only do borrowers end up losing their homes, but a bank’s loss from a foreclosed mortgage can actually be higher than the cost of negotiating more favorable terms with the homeowner. Foreclosures also drag down the value of surrounding properties, creating wider losses by depressing the overall housing market.

[Stanford Graduate School of Business]

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Hopkins v. HOMEWARD RESIDENTIAL, INC., Cal: Court of Appeal, 1st Appellate Dist |  The judgments are reversed with respect to the fifth cause of action (negligence against Homeward), the sixth cause of action (negligence against Citi), and the eleventh cause of action (unfair competition against both defendants)

Hopkins v. HOMEWARD RESIDENTIAL, INC., Cal: Court of Appeal, 1st Appellate Dist | The judgments are reversed with respect to the fifth cause of action (negligence against Homeward), the sixth cause of action (negligence against Citi), and the eleventh cause of action (unfair competition against both defendants)

 

DONALD RAY HOPKINS, Plaintiff and Appellant,
v.
HOMEWARD RESIDENTIAL, INC., et al., Defendants and Respondents.

No. A144292.
Court of Appeals of California, First District, Division Two.
Filed September 28, 2017.
Appeal from the Alameda County, Superior Court No. RG 11581294.

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.115

MILLER, J.

Plaintiff Donald Ray Hopkins (Hopkins) appeals from judgments in favor of defendants Homeward Residential, Inc. (Homeward) and Citibank, N.A. (Citi) following the trial court’s orders sustaining defendants’ demurrers to Hopkins’s fifth amended complaint without leave to amend.[1]

Hopkins took out a loan secured by a deed of trust on his home. Homeward serviced the loan for the lender, and Hopkins made loan payments to Homeward through a checking account he had with Citi. Hopkins sued Homeward, Citi, and the lender, alleging they conspired “to engage [in] an illegal hard money lending and foreclosure scheme.” Essentially, he claimed that he always made or tried to make timely loan payments, but starting in July 2010, defendants conspired to misplace or misallocate his loan payments. This allegedly resulted in Homeward wrongly charging Hopkins late fees, which eventually caused him to stop making loan payments.

On appeal, Hopkins contends he alleged facts showing Homeward and Citi owed him a duty of care to support his negligence claims. He argues he stated a claim of fraudulent concealment of a material fact, and he pleaded all the elements for claims of elder abuse and unfair competition. Hopkins also argues he was excused from continuing to make loan payments, and, therefore, the trial court erred in finding that he was the cause of his own loss.

We conclude Hopkins has alleged sufficient facts to state claims of negligence and unfair competition against Homeward and Citi, but the trial court properly sustained defendants’ demurrers to the remaining claims. Accordingly, we affirm in part and reverse in part.[2]

FACTUAL AND PROCEDURAL BACKGROUND

A. Hopkins Takes Out a Loan in 2006 and Stops Making Payments in 2011

On or about October 24, 2006, Hopkins borrowed $815,000 from American Brokers Conduit (ABC),[3] secured by a first deed of trust on his residence in Oakland (Oakland house). Hopkins made payments on the loan “via electronic checks” from his checking account with Citi. According to Hopkins, he made all payments until April 2011, when he stopped making payments on the loan.

On June 20, 2011, a “Notice of Default and Election to Sell Under Deed of Trust” regarding the Oakland house was recorded at the Alameda County Recorder’s Office.

B. Hopkins Commences This Lawsuit in 2011

On June 17, 2011, Hopkins filed an original verified complaint against American Home Mortgage Servicing, Inc. (AHMS), which is now known as Homeward,[4] and Citi. Hopkins alleged that, “[d]espite plaintiff making timely payments on the Loan, defendants AHMS and ABC declared the Loan in default, initiated collection activities against plaintiff Hopkins, defamed his otherwise impeccable credit and initiated foreclosure.” After many demurrers, motions to amend, amended complaints, and two trips to federal district court, the trial court sustained defendants’ demurrers to Hopkins’s fourth amended complaint and gave him leave to file another amended complaint.

C. Hopkins Files the Operative Complaint in 2014

On July 16, 2014, Hopkins filed his fifth amended complaint, the operative pleading. As relevant to this appeal, he asserted the following claims: negligence against Homeward (fifth cause of action)[5] and Citi (sixth cause of action), slander of title against all defendants (seventh cause of action), fraud against Citi (eighth cause of action) and Homeward (ninth cause of action), financial elder abuse against all defendants (tenth cause of action), and unfair competition against all defendants (eleventh cause of action). Hopkins attached exhibits to his fifth amended complaint, including the loan agreement, a “Customer Account Activity Statement” from Homeward showing its record of Hopkins’s payment history, and monthly account statements Hopkins received from Citi for July through October 2010.

Hopkins alleged he “made all payments in a timely fashion according to the terms of the [loan agreement] (or at least tried to do so and if not was intentionally thwarted by each and every defendant) through and until April 2011, when plaintiff stopped making payments because defendants, and each of them, had obviously formed a conspiracy to foreclose upon the home and flip-it on the real estate market for a windfall profit.”

More specifically, Hopkins alleged that, starting in July 2010, Homeward contacted Citi “and placed a stop order on plaintiff Hopkins[‘s] (timely) July through October 2010 electronic check payments—all without any party defendant ever informing plaintiff Hopkins that they had done so, or telling him why or where the money went after it left plaintiff’s Citibank account.” Hopkins continued, “Obviously, defendant Citibank, or Citibank officials, secreted Don Hopkins'[s] mortgage payment monies away for itself or themselves, somewhere.”[6] As to Citi, he alleged it “implicated itself in a conspiracy against plaintiff Hopkins with defendants ABC and Homeward by, inter alia, agreeing to stop payment of plaintiff’s July 2010 mortgage payment, . . . thereby making the payment late and setting-off a crescendo of alleged late payments and fees on plaintiff’s ABC/Homeward monthly mortgage payment account.”

He further alleged: “Each month, Mr. Hopkins would get a letter from defendant Homeward, saying that the payments were not received and threatening various actions against him. Every month Don Hopkins would go to the offices of defendant Citibank [and] show a bank officer the letter from Homeward. Every month the Citibank officer would review their records and assured Mr. Hopkins that the payments had been sent to Homeward and duly recorded. Don Hopkins relied on these assurances made by defendant Citibank. After about seven months, . . . Mr. Hopkins began receiving calls from Realtors saying his property was on various `default lists.’ Letters to defendant Homeward were responded to with various explanations as to why the payments had not been sufficient—none of which explanations ever made sense, as plaintiff had made every single payment in full, and on time.”

Hopkins alleged that Homeward charged a series of illegal late fees and penalties and imposed “`forced’ insurance,” and that around March 2011, his “account was so deeply embroiled in the fraudulent schemes of each and every defendant that further payments by plaintiff became not only futile, but excused as a matter of law, equity and simple common sense.” He alleged that comparing his checking account statements from Citi with Homeward’s record of his loan payments “reveals the disparity between the two—and the fraud.”

D. Defendants File Demurrers to the Fifth Amended Complaint

Homeward and Citi demurred, and Citi filed a motion to strike. Citi and Homeward asked the trial court to take judicial notice of the deed of trust recorded in relation to the loan in October 2006 and the notice of default recorded in June 2011. Citi also asked the court to take judicial notice of Hopkins’s fourth amended complaint. The trial court granted defendants’ requests for judicial notice.

Citi relies on “Citibank Check Image Delivery” documents

Citi argued the negligence claim failed because Hopkins failed to allege facts demonstrating Citi owed him a legal duty. It further argued that an exhibit attached to his fourth amended complaint (labeled “Citibank Check Image Delivery”) showed that, contrary to Hopkins’s allegations, payments of $2,560.10 were paid to Homeward on July 21 and August 10, 2010, and payments of $2,560 were paid September 15, and October 7, 2010.[7] Finally, Citi claimed the allegations failed to show causation or damages because Hopkins admittedly stopped making payments on the loan as of April 2011.

As to the claim for slander of title, Citi argued the claim failed on many grounds: first, Citi had no interest in the loan and did not record the notice of default; second, publication of a nonjudicial foreclosure document is privileged; third, Hopkins could not allege falsity of the recording because he admittedly stopped making payments; and, fourth, Hopkins failed to allege third-party reliance or any damages.

As to the fraud claim, Citi maintained that Hopkins failed to allege any of the elements of the claim. According to Citi, Hopkins (1) failed to plead any actionable misrepresentation of material fact, (2) failed to plead Citi had knowledge of the falsity of any misrepresentation of fact, (3) failed to allege intent to defraud by Citi, (4) failed to allege justifiable reliance by Hopkins, and (5) failed to allege facts showing proximate damages.

Citi argued the elder abuse claim failed because Hopkins did not allege specific facts, as opposed to conclusions, to support the claim and, further, the exhibits attached to the fourth amended complaint showed Citi processed and delivered monthly checks to Homeward from July 2010 through March 2011, contradicting Hopkins’s allegations. It argued the claim for unfair competition failed because Hopkins could not allege damage and he failed to allege unlawful, fraudulent, or unfair activity with the requisite specificity.

Homeward relies on the “Customer Account Activity Statement”

Homeward made many arguments similar to Citi’s.[8] Homeward argued that its own record of Hopkins’s payment, the “Customer Account Activity Statement” (CAAS) attached to the fifth amended complaint, contradicted Hopkins’s “gratuitous assertions” that he made all loan payments. Instead, Homeward asserted, the CAAS “demonstrates that the last payment received by Homeward was received on March 9, 2011, which payment was applied to Plaintiff’s January, 2011 payment because Plaintiff was behind on his loan.”[9]

The CAAS attached to the fifth amended complaint showed payments recorded in Hopkins’s loan account from July 2008 to July 2011. It showed that all payments were made by the tenth of the month from July 2008 through June 2010.

Then, for July through October 2010, the CAAS showed timely payments received and then returned a few days later.[10] The CAAS did not indicate why the checks were returned. In July through September 2010, a second payment (after the first was returned) was entered, but no payment was recorded in October 2010. Late charges were assessed in July and October 2010. Thus, the CAAS (which Homeward relies on to show it did nothing wrong) is not consistent with the “Citibank Check Image Delivery” (which Citi relies on to show it did nothing wrong) In particular, the “Citibank Check Image Delivery” showed a payment to Homeward was made on October 7, 2010, but no corresponding payment was recorded in the CAAS, and Homeward assessed a late fee against Hopkins that month.[11]

E. The Trial Court Sustains the Demurrers Without Leave to Amend

On October 22, 2014, the trial court sustained the demurrers without leave to amend. The court ruled the negligence claims failed because Hopkins “has not yet alleged facts demonstrating that [either] defendant owed plaintiff a duty.”

The court ruled the claim for slander of title failed because Hopkins “has not alleged facts showing a tortious injury to his property resulting from unpublished, false, and malicious publication of disparaging statements regarding the title to property owned by plaintiff to plaintiff’s damage.”

The fraud claims failed because “after six opportunities to amend, plaintiff has failed to allege facts as opposed to conclusions showing specifically that [either] defendant should be liable for fraud.”

As to the claim for elder abuse, the court ruled, “The basis of plaintiff’s claim is that payments at issue were converted (in contradiction to the exhibits attached to plaintiff’s complaints)—and that is the reason that the notice of default was recorded. However, plaintiff also admits his decision to stop making payments before the notice of default was recorded. There are simply insufficient facts alleged showing that [either] defendant was responsible for the alleged conversion or responsible under a viable cause of action as a basis to state this claim.” With respect to Homeward, the court further found that the claim was barred by the applicable statute of limitations.

As to the claim of unfair competition, the court ruled Hopkins “did not establish standing, a predicate [to a] viable underlying claim showing [either] defendant’s alleged conduct was unfair or unlawful in support of this claim.”

DISCUSSION

A. Standard of Review

“We independently review the ruling on a demurrer and determine de novo whether the complaint alleges facts sufficient to state a cause of action. [Citation.] We assume the truth of the properly pleaded factual allegations, facts that reasonably can be inferred from those expressly pleaded, and matters of which judicial notice has been taken.” (Fremont Indemnity Co. v. Fremont General Corp.(2007) 148 Cal.App.4th 97, 111.) “We do not, however, assume the truth of contentions, deductions, or conclusions of fact or law.” (Moore v. Regents of University of California (1990) 51 Cal.3d 120, 125.) “We construe the pleading in a reasonable manner and read the allegations in context. [Citation.] We affirm the judgment if it is correct on any ground stated in the demurrer, regardless of the trial court’s stated reasons.” (Fremont Indemnity Co., supra, at p. 111.)

“As a general rule in testing a pleading against a demurrer the facts alleged in the pleading are deemed to be true, however improbable they may be.” (Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604.) Under the truthful pleading doctrine, however, courts “will not close their eyes to situations where a complaint contains allegations of fact inconsistent with attached documents, or allegations contrary to facts which are judicially noticed. [Citations.] Thus, a pleading valid on its face may nevertheless be subject to demurrer when matters judicially noticed by the court render the complaint meritless.” (Ibid.)

“If the trial court has sustained the demurrer, we determine whether the complaint states facts sufficient to state a cause of action. If the court sustained the demurrer without leave to amend, as here, we must decide whether there is a reasonable possibility the plaintiff could cure the defect with an amendment. [Citation.] If we find that an amendment could cure the defect, we conclude that the trial court abused its discretion and we reverse; if not, no abuse of discretion has occurred. [Citation.] The plaintiff has the burden of proving that an amendment would cure the defect.” (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.)

With these standards in mind, we consider whether Hopkins has stated a cause of action against any defendant.

B. Fifth and Sixth Causes of Action: Negligence

The trial court ruled that the negligence claims against Homeward and Citi failed because Hopkins “has not yet alleged facts demonstrating that defendant owed plaintiff a duty.” Hopkins contends both Homeward and Citi owed him a duty of care under the facts alleged. This contention has merit.

1. Homeward[12]

Hopkins states the question on appeal is whether a loan servicer, such as Homeward, owes a borrower a duty of care in accounting for and handling loan payments. He argues the answer must be yes under our decision in Jolley v. Chase Home Finance, LLC (2013) 213 Cal.App.4th 872 (Jolley).

In Jolley, we acknowledged “`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.'” (Jolley, supra, 213 Cal.App.4th at p. 898.) But, we continued, “the no-duty rule is only a general rule.” (Id. at p. 901.) It does not mean a lender never owes a duty of care to a borrower. Instead, the question whether a lender owes such a duty requires the balancing of the “Biakanja factors” set forth in Biakanja v. Irving (1958) 49 Cal.2d 647, 650 (Biakanja). (Jolley, supra, 213 Cal.App.4th at p. 901.)[13]

Jolley involved a construction loan agreement, and the plaintiff-borrower alleged the lender failed to properly disburse construction funds. (Jolley, supra, 213 Cal.App.4th at p. 877.) We concluded there was a triable issue of material fact as to whether the defendant (the successor to the original lender) was liable for negligence, and reversed a summary adjudication in favor of the defendant. (Id. at p. 897.)

In Jolley, we noted, “[W]e deal with a construction loan, not a residential home loan where, save for possible loan servicing issues, the relationship ends when the loan is funded. By contrast, in a construction loan the relationship between lender and borrower is ongoing, in the sense that the parties are working together over a period of time, with disbursements made throughout the construction period, depending upon the state of progress towards completion. We see no reason why a negligent failure to fund a construction loan, or negligent delays in doing so, would not be subject to the same standard of care.” (Jolley, supra, 213 Cal.App.4th at p. 901, italics added.) Thus, we held the ongoing relationship involved in a construction loan may impose a duty of care owed to the borrower, and we suggested that, in the case of a residential home loan, the ongoing relationship of servicing the loan might also give rise to a duty of care.

While we only suggested the servicing of a home loan may impose a duty of care in Jolley, Division Three of our court decided the issue in Alvarez v. BAC Home Loans Servicing, L.P. (2014) 228 Cal.App.4th 941 (Alvarez). In Alvarez,homeowners sued their lender and its loan servicer alleging, “among other things, fraud and unfair business practices in the origination of plaintiffs’ residential mortgage loans, and negligence in the subsequent servicing of the loans, including negligent review of plaintiffs’ applications for loan modification.” (Id. at pp. 943-944, italics added.) They alleged the defendants breached their duty to exercise reasonable care by, among other things, “mishandling plaintiffs’ applications [for loan modification] by relying on incorrect information.” (Id. at p. 945, italics added.) The trial court sustained the defendants’ demurrer to the negligence claim, concluding they owed no duty of care to the homeowners. (Id. at p. 944.)

The Court of Appeal reversed. Considering the Biakanja factors, the appellate court concluded the plaintiffs stated a claim of negligence against the defendants: “Here, because defendants allegedly agreed to consider modification of the plaintiffs’ loans, the Biakanja factors clearly weigh in favor of a duty. The transaction was intended to affect the plaintiffs and it was entirely foreseeable that failing to timely and carefully process the loan modification applications could result in significant harm to the applicants. Plaintiffs allege that the mishandling of their applications `caus[ed] them to lose title to their home, deterrence from seeking other remedies to address their default and/or unaffordable mortgage payments, damage to their credit, additional income tax liability, costs and expenses incurred to prevent or fight foreclosure, and other damages.’ . . . `Although there was no guarantee the modification would be granted had the loan been properly processed, the mishandling of the documents deprived Plaintiff of the possibility of obtaining the requested relief.’ [Citation.] Should plaintiffs fail to prove that they would have obtained a loan modification absent defendants’ negligence, damages will be affected accordingly, but not necessarily eliminated.” (Alvarez, supra, 228 Cal.App.4th at pp. 948-949.)

The Alvarez court explained why a duty of care should be imposed on the servicer of the loan in particular. “`[B]orrowers are captive, with no choice of servicer, little information, and virtually no bargaining power. Servicing rights are bought and sold without input or approval by the borrower. Borrowers cannot pick their servicers or fire them for poor performance. The power to hire and fire is an important constraint on opportunism and shoddy work in most business relationships. But in the absence of this constraint, servicers may actually have positive incentives to misinform and under-inform borrowers. Providing limited and low-quality information not only allows servicers to save money on customer service, but increases the chances they will be able to collect late fees and other penalties from confused borrowers.'” (Alvarez, supra, 228 Cal.App.4th at p. 949.) The court reasoned, “The borrower’s lack of bargaining power, coupled with conflicts of interest that exist in the modern loan servicing industry, provide a moral imperative that those with the controlling hand be required to exercise reasonable care in their dealings with borrowers seeking a loan modification.” (Ibid.)

Following Jolley and Alvarez, the Sixth District in Daniels concluded that homeowners stated a claim of negligence where they alleged the loan servicer, among other things, did “not accurately account[] for their trial payments.” (Daniels, supra, 246 Cal.App.4th at p. 1184.) The homeowners also alleged they “attempted to resume making their regular, higher monthly payments, but [the loan servicer] refused to accept those payments.” (Id. at p. 1159.) The Daniels court held, “a loan servicer may owe a duty of care to a borrower through application of the Biakanja factors, even though its involvement in the loan does not exceed its conventional role.” (Id. at p. 1158, fn. omitted.)

Jolley, Alvarez, and Daniels all support the conclusion Hopkins has adequately alleged Homeward owed him a duty of care in processing, and accounting for, his loan payments. Consideration of the Biakanja factors leads us to the same conclusion. The transaction of accepting and accounting for loan payments obviously affected Hopkins. Homeward’s alleged failure to account for payments received and its alleged instruction to Citi to stop payments of Hopkins’s checks resulted in unwarranted late charges, a harm to Hopkins. The injury of unwarranted late fees is certain. There is a close connection between Homeward’s alleged conduct and the harm since, according to Hopkins, his payments would have been timely and no late fees would have been imposed without Homeward’s alleged breach. Instructing Citi to stop payment on Hopkins’s timely payments and failing to account for Hopkins’s payments is morally blameworthy conduct. Finally, the policy of preventing future harm favors imposing a duty on loan servicers not to mishandle and misallocate payments received from borrowers. The Alvarez court observed that the economics and incentives of the loan servicing industry may encourage loan servicers to misinform borrowers to “`increase[] the chances they will be able to collect late fees and other penalties from confused borrowers.'” (Alvarez, supra, 228 Cal.App.4th at p. 949.) The same incentive structure could result in loan servicers keeping sloppy, inaccurate records of loan payments in order to impose unwarranted late fees. The Alvarez court concluded, “The borrower’s lack of bargaining power, coupled with conflicts of interest that exist in the modern loan servicing industry, provide a moral imperative that those with the controlling hand be required to exercise reasonable care in their dealings with borrowers seeking a loan modification.” (Ibid.) We believe loan servicers should be required to exercise reasonable care in their dealings with borrowers who make timely payments as well.[14]

Homeward maintains that even if a duty of care exists, Hopkins has not alleged facts demonstrating it breached that duty. Homeward argues that Hopkins’s allegation that Homeward misplaced or misallocated his loan payments is contradicted by the CAAS, which Hopkins attached to the fifth amended complaint. Homeward asserts, “The CAAS demonstrates that Homeward received and credited all of Appellant’s payments and demonstrates that Appellant made his last payment on March 9, 2011, which payment was applied retroactively, to January, 2011, because Appellant was past due for January 1, 2011 payment.” We disagree.

Hopkins attached the CAAS to his fifth amended complaint presumably because it showed entries for “return check” on July 7, August 5, September 7, and October 6, 2010. These entries for “return check” support his allegation that Homeward contacted Citi “and placed a stop order on plaintiff Hopkins[‘s] (timely) July through October 2010 electronic check payments” without telling Hopkins.

Hopkins alleged he made or tried to make timely payments every month until he stopped making payments in April 2011. He alleged he was improperly charged late fees, sent overdue notices, and eventually threatened with foreclosure. These allegations are not contradicted by the CAAS. The CAAS showed late fees were charged on July 16 and October 18, 2010, and on February 16, April 18, and May 16, 2011, and further showed no credit for payments (i.e., missed payments) in October 2010 and February 2011. Accepting as true Hopkins’s allegation that he made or tried to make timely loan payments every month until April 2011, the CAAS is consistent with his further allegations that Homeward wrongly imposed late fees and failed to account for his payments. Moreover, Hopkins alleged a “disparity” between his checking account statements and Homeward’s accounting, and the exhibits attached to the fifth amended complaint bear this out. Hopkins’s monthly account statement from Citi for October 2010 showed a payment to Homeward of $2,560, but the CAAS showed no credited payment for October 2010. Homeward’s argument fails because the CAAS does not contradict Hopkins’s allegations.[15]

2. Citi

The trial court ruled that Hopkins failed to state a claim of negligence against Citi because Hopkins “has not yet alleged facts demonstrating that defendant owed plaintiff a duty.” As Hopkins pointed out in his opposition to Citi’s demurrer, however, “[i]t is well established that a bank has `a duty to act with reasonable care in its transactions with its depositors.'” (Chazen v. Centennial Bank (1998) 61 Cal.App.4th 532, 543.) Hopkins alleged he was a customer with a checking account at Citi. As such, he was owed a duty of care by Citi.

Citi argues that, even if it owed a duty of care, there has been no breach of that duty. Citi asserts it “dutifully complied with [Hopkins’s] check requests, as it issued monthly checks from July 2010 through October 2010, which were debited from [his] Citi checking account and were credited to the Subject Loan.” Citi, however, does not address the allegations that Hopkins timely instructed Citi to make the July 2010 and subsequent payments, but that Citi permitted Homeward to stop payment without telling Hopkins. Hopkins alleged Citi’s conduct caused his July payment to be late and “set[] off a crescendo of alleged late payments and fees.”[16] We conclude Hopkins has sufficiently alleged a breach of duty by Citi (in stopping payments without telling Hopkins) and resulting harm (late payments and late fees).

Citi argues that Hopkins cannot allege fact to show it caused him damage because he admittedly stopped making payments on his loan in April 2011. This argument, however, ignores the harm of allegedly wrongly imposed late fees and misallocated payments, which preceded Hopkins’s decision to stop making payments on his loan.

3. Conclusion

Citi describes Hopkins’s allegations as “fantastical” and Homeward characterizes them as “gratuitous,” but we must accept the allegations as true, no matter how unlikely or improbable they may be and without regard to Hopkins’s ability to prove them. (Bock v. Hansen (2014) 225 Cal.App.4th 215, 220.) For the reasons explained above, we conclude Hopkins alleged facts sufficient to demonstrate Homeward and Citi owed him a duty of care, and he sufficiently alleged harm in the form of wrongly imposed late fees and misallocated payments.[17] Therefore, the trial court erred in sustaining demurrers to the fifth and sixth causes of action for negligence.

C. Seventh Cause of Action: Slander of Title

The trial court ruled the claim for slander of title failed because Hopkins “has not alleged facts showing a tortious injury to his property resulting from unpublished, false, and malicious publication of disparaging statements regarding the title to property owned by plaintiff to plaintiff’s damage.” Hopkins does not specifically challenge this ruling, and we see no error. (See Kachlon v. Markowitz (2008) 168 Cal.App.4th 316, 343 [recording a notice of default is a privileged communication unless done with malice].)

D. Eighth and Ninth Causes of Action: Fraud

The trial court concluded the fraud claims failed because “after six opportunities to amend, plaintiff has failed to allege facts as opposed to conclusions showing specifically that [either] defendant should be liable for fraud.” Hopkins argues his fifth amended complaint stated a cause of action for fraudulent concealment of a material fact against Citi.

Hopkins relies on Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 173, in which our high court set forth the elements of fraud: “`”The elements of fraud, which gives rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or `scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.”‘” (Italics added.)

“Fraud allegations `involve a serious attack on character’ and therefore are pleaded with specificity. [Citation.] General and conclusory allegations are insufficient. [Citation.] The particularity requirement demands that a plaintiff plead facts which `”`show how, when, where, to whom, and by what means the representations were tendered.'”‘ [Citation.] Further, when a plaintiff asserts fraud against a corporation, the plaintiff must `allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written.’ [Citation.] Less specificity in pleading fraud is required `when “it appears from the nature of the allegations that the defendant must necessarily possess full information concerning the facts of the controversy. . . .”‘” (Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1469.)

In support of his claim of fraud against Citi, Hopkins alleged that from May 2011 “to the present time,” two employees of Citi, David McGuiness and John Oushana, “repeatedly engaged [in] evasive conduct in successfully avoiding delivering to plaintiff Don Hopkins a copy of the July 2010 electronic check, e.g., the first check that . . . Homeward stated `bounced’ and based upon which . . . Homeward initiated foreclosure and filed a Notice of Default.” He described the Citi employees’ conduct as “stonewalling” and alleged they “hop[ed] that Mr. Hopkins would simply fall victim to the scam and go away.” The fraud claim fails because it lacks the required element of justifiable reliance. Hopkins claims defendants engaged in misconduct in July to October 2010, and he stopped making payments on his loan in April 2011 allegedly because of defendants’ misconduct. The “stonewalling,” however, allegedly began in May 2011, after Hopkins stopped making payments on his loan. Given the sequence of alleged events, it cannot be said that he justifiably relied on these employees’ conduct to his detriment.

Hopkins’s remaining allegations in support of his fraud claims are boilerplate language with no facts specific to defendants. As to Citi, Hopkins alleged “Defendant Citibank’s above-stated conduct [presumably referring to the two employees’ conduct] and concealments and misrepresentations were misleading, false and fraudulent. At the time said defendant engaged [in] the conduct and made the misrepresentations, said defendants willfully and/or negligently concealed and/or misrepresented the true facts, all for the purpose of defrauding and deceiving plaintiff and in violation of law and public policy.” He further alleged, “The aforementioned conduct of each and every defendant was intentional misconduct, misrepresentation, deceit or concealment of material fact(s) known to said defendant with the intention on the part of said defendant to deprive plaintiff of property or legal rights, or otherwise causing injury. . . .” We agree with the trial court that these generic allegations of deception and intent to defraud are insufficient to state a cause of action for fraud.

As to Homeward, Hopkins makes no argument regarding his fraud claim against the loan servicer in his opening brief. As a result, he has forfeited any challenge to the trial court’s ruling on this claim. (Koval v. Pacific Bell Telephone Co. (2014) 232 Cal.App.4th 1050, 1063, fn. 12 [“An appellant’s failure to raise an argument in its opening brief waives the issue on appeal.”].)

Based on the foregoing, we conclude the trial court properly sustained the eighth and ninth causes of action for fraud.

E. Tenth Cause of Action: Elder Abuse

The trial court ruled, “There are simply insufficient facts alleged showing that [either] defendant was responsible for the alleged conversion or responsible under a viable cause of action as a basis to state this claim [for elder abuse].” Hopkins argues on appeal that the trial court erred because (1) Hopkins was excused from continuing to make loan payments (and therefore he has alleged causation and damages), and (2) the claim is not barred by the statute of limitations. These arguments respond to some of the arguments made by defendants in support of their demurrers. However, Hopkins does not address the fundamental issue that he failed to allege sufficient facts, as opposed to legal conclusions, to support this claim.

Under Welfare and Institutions Code section 15610.30, “[f]inancial abuse” of an elder occurs when a person or entity “[t]akes, secretes, appropriates, obtains, or retains real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both” or “[a]ssists in taking, secreting, appropriating, obtaining, or retaining real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.” (Welf. & Inst. Code, § 15610.30, subd. (a)(1) & (2), italics added.)

Citi argues, as it did below, that a claim of financial elder abuse must be alleged with particularity because the claim involves fraud. We also observe that, for purposes of the statute, taking property “for a wrongful use,” means the defendant breached a contract or engaged in “other improper conduct.” (Paslay v. State Farm General Insurance Company (2016) 248 Cal.App.4th 639, 657.)

We agree with Citi that Hopkins has not alleged sufficient facts to state a claim of elder abuse. He alleged against all defendants: “Each and every defendant took, secreted, appropriated and retained plaintiff’s real or personal property, his home equity, via a deceitful loan and deed of trust secured on plaintiff’s home. Each and every defendant took said property for wrongful use and with intent to defraud.” “Defendants, and each of them, knew or should have known that plaintiff had a right to retain his home equity and that the hard money lending and foreclosure operation was a sham. Each and every defendant acted in bad faith pursuant to W.I.C. § 15610.30(b)(2).” “Each and every defendants’ actions were fraudulent, repeated and were committed with the willful intention and design to injure plaintiff and his property rights.” Hopkins alleged he was a senior and disabled, and “Each and every defendant knew or should have known that plaintiff is disabled and elderly. . . .”

These boilerplate allegations contain no facts regarding wrongful use or intent to defraud by either defendant. Moreover, to the extent Hopkins made allegations beyond parroting the language of the statute, he referred to a “deceitful loan and deed of trust.” But neither Homeward nor Citi is alleged to be a party to the loan agreement. We conclude Hopkins failed to state a claim of elder abuse, and the trial court properly sustained defendants’ demurrers to the tenth of action.

F. Eleventh Cause of Action: Unfair Competition

The trial court ruled that the claim of unfair competition failed because Hopkins “did not establish standing, a predicate [to a] viable underlying claim showing [either] defendant’s alleged conduct was unfair or unlawful in support of this claim.”

Private standing to bring a claim under the unfair competition law (UCL) “`is limited to any “person who has suffered injury in fact and has lost money or property” as a result of unfair competition.'” (Kwikset Corp. v. Superior Court (2011) 51 Cal.4th 310, 320-321, quoting Bus. & Prof. Code, § 17204.) Here, the trial court found that Hopkins lacked standing, presumably accepting defendants’ argument that Hopkins could not allege damages because he admittedly stopped making payments on the loan in April 2011. But, as we explained in our discussion of negligence, Hopkins sufficiently alleged harm in the form of wrongly imposed late fees and misallocated payments, separate from whether his own action was the cause of the recording of default.

The question remains whether Hopkins alleged sufficient facts to support his claim.

The UCL defines “unfair competition” to “include any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising. . . .” (Bus. & Prof. Code, § 17200.) “`Because Business and Professions Code section 17200 is written in the disjunctive, it establishes three varieties of unfair competition—acts or practices which are [1] unlawful, or [2] unfair, or [3] fraudulent. “In other words, a practice is prohibited as `unfair’ or `deceptive’ even if not `unlawful’ and vice versa.”‘” (Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20 Cal.4th 163, 180.)

In the fifth amended complaint, Hopkins relied on “the above-stated tortious conduct,” incorporating all prior allegations, to support his claim under the unfair competition law (UCL). He contends his allegations satisfy “the `deceptive’ conduct prong of the UCL,” i.e., the “fraudulent” variety of unfair competition. He also argues defendants’ breaches of their duties of care constitutes an unfair business practice under the UCL.

Our conclusion that Hopkins has not stated a claim of fraud is not dispositive. “The fraudulent business practice prong of the UCL has been understood to be distinct from common law fraud. `A [common law] fraudulent deception must be actually false, known to be false by the perpetrator and reasonably relied upon by a victim who incurs damages. None of these elements are required to state a claim for injunctive relief’ under the UCL. [Citations.] This distinction reflects the UCL’s focus on the defendant’s conduct, rather than the plaintiff’s damages, in service of the statute’s larger purpose of protecting the general public against unscrupulous business practices.” (In re Tobacco II Cases (2009) 46 Cal.4th 298, 312.)

It has been held that misleading a borrower about the status of loan modification or pending foreclosure is fraudulent or unfair conduct for purposes of the UCL. (Lueras v. BAC Home Loans Servicing, LP (2013) 221 Cal.App.4th 49, 85 [“It is fraudulent or unfair for a lender to proceed with foreclosure after informing a borrower he or she has been approved for a loan modification, or telling the borrower he or she will be contacted about other options and the borrower’s home will not be foreclosed on in the meantime. . . . It is fraudulent or unfair for a lender to misrepresent the status or date of a foreclosure sale.”].) Here, Hopkins alleged Citi told him his payments to Homeward were being made every month, but Homeward improperly charged late fees, recorded missed payments, and sent overdue notices. Thus, under Hopkins’s allegations, either Citi misled him about payments made to Homeward, or Homeward assessed late fees that were not warranted and misallocated payments. We conclude these are sufficient allegations of fraudulent or unfair conduct for purposes of the UCL. Accordingly, the trial court erred in sustaining defendants’ demurrers to the eleventh cause of action.

DISPOSITION

The judgments are reversed with respect to the fifth cause of action (negligence against Homeward), the sixth cause of action (negligence against Citi), and the eleventh cause of action (unfair competition against both defendants). The judgments are affirmed in all other respects. The parties shall bear their own costs on appeal.

Richman, Acting P.J. and Stewart, J., concurs.

[1] Hopkins filed a notice of appeal on December 17, 2014, although judgments in favor of Homeward and Citi were not filed until January 27, 2015. We elect to treat the premature notice of appeal “as filed immediately after entry of judgment.” (Cal. Rules of Court, rule 8.104(d)(2); see Cabral v. Soares (2007) 157 Cal.App.4th 1234, 1239, fn. 2.)

[2] At oral argument in July 2017, we were told, for the first time, that Hopkins had filed for bankruptcy. We continued oral argument and asked the parties for supplemental briefing on what effect Hopkins’s bankruptcy case has on this appeal. In response, the parties agree the appeal is not subject to an automatic stay under 11 United States Code section 362. We agree with the parties. A bankruptcy stay only applies to actions against the debtor, so it does not apply in this case, where the debtor (Hopkins) initiated the lawsuit. (See Shah v. Glendale Federal Bank (1996) 44 Cal.App.4th 1371, 1375.)

In their supplemental briefing, Homeward and Citi take the position that judicial estoppel applies to this appeal because Hopkins did not list the current lawsuit as an asset in his bankruptcy schedules and, where he did list the lawsuit, he did not give it a value. Therefore, they argue, Hopkins has represented to the bankruptcy court that this lawsuit has no value, and he should be barred from continuing to claim in this court that the lawsuit does have value. Hopkins responds, first, judicial estoppel does not apply and, second, even if it does, this court should not decide the issue on appeal. He is certainly correct on the second issue.

Judicial estoppel applies “when: (1) the same party has taken two positions; (2) the positions were taken in judicial or quasi-judicial administrative proceedings; (3) the party was successful in asserting the first position (i.e., the tribunal adopted the position or accepted it as true); (4) the two positions are totally inconsistent; and (5) the first position was not taken as a result of ignorance, fraud, or mistake.” (Jackson v. County of Los Angeles (1997) 60 Cal.App.4th 171, 183, italics added.) “[N]ondisclosure in bankruptcy filings, standing alone, is insufficient to support the finding of bad faith intent necessary for the application of judicial estoppel.” (Cloud v. Northrop Grumman Corp. (1998) 67 Cal.App.4th 995, 1019; see also Kelsey v. Waste Management of Alameda County (1999) 76 Cal.App.4th 590, 598-600[evidence that plaintiff failed to list his claim against defendant in his bankruptcy proceedings was insufficient to establish defendant was entitled to summary judgment based on judicial estoppel].) Here, it is a question of fact whether Hopkins’s failure to identify the current lawsuit as an asset in his bankruptcy filings was the result of ignorance or mistake. (We note that Hopkins’s attorney told the court during September 19, 2017, oral argument that Hopkins had amended his bankruptcy filings so that the lawsuit was listed as an asset of unknown value.) This court is not in a position to resolve issues of fact. Accordingly, we do not consider whether judicial estoppel applies in this case. Defendants are free to raise the issue of judicial estoppel in the trial court.

[3] ABC was named a defendant in the operative complaint, but it is not a party to this appeal.

[4] For clarity and consistency, we will refer to this defendant as “Homeward.” We note that this defendant appeared in court as “AHMS” until at least October 2011, and in July 2012, identified itself as “Homeward Residential, Inc. f/k/a American Home Mortgage Servicing, Inc.”

[5] The first four causes of action were against ABC only and are not relevant to this appeal.

[6] Hopkins further alleged Citi failed to return funds to his account and falsified his monthly account statements so that it appeared the payments were made to Homeward, “thereby secreting and converting the money for itself.”

[7] Although Citi referred to an exhibit attached to the prior complaint, this exhibit (the “Citibank Check Image Delivery”) was also attached to the fifth amended complaint.

[8] In addition, Homeward argued the claim of slander of title failed because the recording of a notice of default would not cast doubt as to Hopkins’s ownership interest in the Oakland house, and the elder abuse claim failed because Homeward did not originate the underlying loan and because the claim was barred by the statute of limitations. Homeward also generally argued Hopkins failed to allege facts showing conduct by Homeward caused him damage.

[9] We observe that Homeward’s position that Hopkins was behind on his loan in March 2011 is inconsistent with Citi’s assertion that it delivered monthly checks to Homeward from July 2010 through March 2011. (And, of course, Homeward’s position conflicts with Hopkins’s allegation that he made timely payments until April 2011.)

[10] Specifically, on July 1, 2010, there is an entry for a payment of $2,560.10, but on July 7, 2010, there is an entry for “return check.” (Capitalization omitted.) On July 16, 2010, there is a late charge assessment of $128.01, and on July 20, 2010, another payment for $2,560.10 is recorded. Similarly, in August, September, and October, there are entries for payment on the first or second day of the month, followed by entries for “return check” a few days later. In August, after the entry for “return check,” a subsequent payment was recorded on August 9, 2010. In September, after the entry for “return check,” a payment was recorded on September 14, 2010. In October, however, a late charge was assessed on October 18, 2010, and there is no record of payment after the entry for a “return check.”

[11] Further, Hopkins’s monthly account statement from Citi for October 2010 (which was attached to the fifth amended complaint) showed a payment to Homeward of $2,560.

[12] At the outset, we reject Homeward’s position that Hopkins should be precluded from arguing the merits of his fifth amended complaint. Hopkins filed an untimely opposition to Homeward’s demurrer, and Homeward claims that, as a result, the trial court refused to consider his papers and sustained its demurrer as unopposed. The court order sustaining Homeward’s demurrer describes the demurrer as “unopposed,” but also states that a tentative ruling was published and contested and the “matter was argued and submitted.” The trial court considered the legal arguments raised in Homeward’s demurrer, heard oral argument, and then ruled on the legal merits of the demurrer. Under these circumstances, we do not believe Hopkins has forfeited all challenges to the court’s ruling. In any event, “we may . . . consider new theories on appeal to challenge or justify the trial court’s rulings” because demurrers raise only questions of law. (Daniels v. Select Portfolio Servicing, Inc. (2016) 246 Cal.App.4th 1150, 1163 (Daniels).)

[13] “The Biakanja factors are six nonexhaustive factors: (1) the extent to which the transaction was intended to affect the plaintiff, (2) the foreseeability of harm to the plaintiff, (3) the degree of certainty that the plaintiff suffered injury, (4) the closeness of the connection between the defendant’s conduct and the injury suffered, (5) the moral blame attached to the defendant’s conduct, and (6) the policy of preventing future harm.” (Jolley, supra, 213 Cal.App.4th at p. 899, citing Biakanja, supra, 49 Cal.2d at p. 650.)

[14] Homeward takes the position that loan servicers do not owe a legal duty to borrowers in connection with the general servicing of residential mortgage loans, citing many federal district court cases that generally state this rule. But all of the cases Homeward cites were decided without the benefit of Daniels, and all but one was decided before Alvarez. Suffice it to say we do not find these cases persuasive authority for Homeward’s position. We likewise are unpersuaded by Homeward’s attempts to distinguish Jolley and Alvarez on the facts. The same reasoning and application of the Biakanjafactors that led the courts to conclude a duty of care existed in Jolley and Alvarez lead us to conclude a duty of care exists under the facts Hopkins has alleged.

[15] Homeward argues the CAAS must “trump” Hopkins’s allegations. To the extent Homeward is arguing we must accept the contents of the CAAS as true under the truthful pleading doctrine, we reject this argument. It is clear Hopkins did not attach the CAAS and his account statements from Citi to his fifth amended complaint so as to adopt the truth of their entire contents. To the contrary, he attached these documents, in part, to demonstrate that they contradicted each other and to show that Homeward kept an incorrect record of his loan payment history. Under these circumstances, there is no basis for Homeward to invoke the truthful pleading doctrine to defeat Hopkins’s allegations. Nor is there any basis for accepting the truth of the contents of the CAAS through judicial notice. (See Joslin v. H.A.S. Ins. Brokerage (1986) 184 Cal.App.3d 369, 374-375 [“Taking judicial notice of a document is not the same as accepting the truth of its contents or accepting a particular interpretation of its meaning”; “`judicial notice of matters upon demurrer will be dispositive only in those instances where there is not or cannot be a factual dispute concerning that which is sought to be judicially noticed.'”].) Hopkins disputes the payment history described in the CAAS, and, unlike a contract, the CAAS has no “independent legal significance.” (Cf. Scott v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 743, 758 [in deciding a demurrer, court properly could take judicial notice of a purchase and assumption agreement, which established “facts deriving from the independent legal significance of a contract,” and the facts were not reasonably subject to dispute].)

[16] We also note that the CAAS showed late fees were imposed in July and October 2010 and there was a missed payment in October 2010.

[17] Both defendants argue that Hopkins cannot establish damages because he admittedly stopped making payments on the loan in April 2011, and therefore he is responsible for the recording of the notice of default. Should Hopkins fail to prove defendants were the cause of the recording of the notice of default, “damages will be affected accordingly, but not necessarily eliminated.” (Alvarez, supra, 228 Cal.App.4th at pp. 948-949.)

In addition, for the first time in oral argument on September 19, 2017, both defendants argue that Hopkins’s claims against them should be governed by contract law, not tort law. We decline to consider this argument, “which the briefs do not raise or discuss and which is asserted for the first time in oral argument” (Archdale v. American Intern. Specialty Lines Ins. Co. (2007) 154 Cal.App.4th 449, 472) and which is based on a case that is not citeable.

 

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TFH 10/15 | Foreclosure Workshop #48: Kipuhulu Sugar Co. v. Nakila — Does a Different Statute of Limitations Apply to the Enforcement of Mortgages than to the Enforcement of Notes?

TFH 10/15 | Foreclosure Workshop #48: Kipuhulu Sugar Co. v. Nakila — Does a Different Statute of Limitations Apply to the Enforcement of Mortgages than to the Enforcement of Notes?

COMING TO YOU LIVE DIRECTLY FROM THE DUBIN LAW OFFICES AT HARBOR COURT, DOWNTOWN HONOLULU, HAWAII

LISTEN TO KHVH-AM (830 ON THE AM RADIO DIAL)

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Sunday – October 15

 ———————
Foreclosure Workshop #48: Kipuhulu Sugar Co. v. Nakila — Does a Different Statute of Limitations Apply to the Enforcement of Mortgages than to the Enforcement of Notes?

 

 

In recent years, particularly in Florida, there has been increasing litigation regarding the applicability of the statute of limitations in foreclosure cases, and now courts in other states have started to wrestle in the mortgage context with this yet another confusing area of American law.

On prior shows we have discussed how the statute of limitations, which sets a time bar controlling how long litigants have to sue on their claims in court, should be and is being applied to mortgage loans, and once again the treatment of homeowners is shown to differ when compared to how the statute of limitations is applied in other contract actions.

Even though, for instance, a mortgage (and deed of trust) represent security for payment of the underlying debt and once the underlying debt obligation is uncollectible, having been paid or having expired by operation of law, it logically follows that the security for payment of the debt is extinguished as well.

But the requirements of logic never seem to deter foreclosure attorneys, who in Hawaii have now begun to argue the opposite, that a mortgage continues to be enforceable up to twenty years even though the note has become unenforceable due to the expiration of the applicable contract statute of limitations.

Will this counter-intuitive argument be coming to your jurisdiction soon?

Tracing the more than one-hundred-year-old origins of this erroneous argument is not only important in order to block its likely use by foreclosure attorneys in the future, but is important also to expose some of the most alarming weaknesses in the misuse of the doctrine of stare decisis which requires that past judicial decisions be followed no matter what, particularly by lower courts.

Bad precedents can become, like deadly viruses, fatal to personal and property rights.

And lastly, this newly emerging and erroneous statute of limitations argument clearly illustrates why homeowners need to unite and collectively support the Homeowners SuperPAC as the only means of organizing to effectively combat the otherwise proliferation of so many of these bad precedents being generated by what we have described on past shows as The Rule Ritual.

Listen to today’s show, posted on our website at www.foreclosurehour.com, and find out how you can change American history, beat the banks, by joining the Homeowners SuperPAC today.

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Host: Gary Dubin Co-Host: John Waihee

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CALL IN AT (808) 521-8383 OR TOLL FREE (888) 565-8383

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Submit questions to info@foreclosurehour.com

The Foreclosure Hour is a public service of the Dubin Law Offices

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The Foreclosure Hour 12

 

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Citi, Deutsche Bank, HSBC agree to pay $132 million to settle Libor claims

Citi, Deutsche Bank, HSBC agree to pay $132 million to settle Libor claims

Reuters-

Citigroup Inc, Deutsche Bank AG and HSBC Holdings Plc have agreed to pay a combined $132 million to settle a U.S. class action brought by futures traders accusing them of manipulating the Libor benchmark interest rate, according to a U.S. court filing on Wednesday.

Citi, Deutsche Bank and HSBC agreed to pay $33.4 million, $80 million and $18.5 million, respectively, according to the filing in Manhattan federal court. The settlements must be approved by U.S. District Judge Naomi Reice Buchwald.

The money would go to proposed classes consisting of anyone who traded in Eurodollar futures on exchanges, including but not limited to the Chicago Mercantile Exchange, between Jan. 1, 2003 and May 31, 2011, according to the filing.

[REUTERS]

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Maine Supreme Court Ruling Could Provide Relief for Victims of Foreclosure Abuse

Maine Supreme Court Ruling Could Provide Relief for Victims of Foreclosure Abuse

Free Press Online-

Last month, the Maine Supreme Court issued a stunning rebuke to national mortgage companies that have flagrantly committed fraud and abuse against homeowners across the state. In its groundbreaking decision, the state’s highest court ruled in the case Federal National Mortgage Association (Fannie Mae) v. Deschaine that the governmentbacked mortgager Fannie Mae is barred from bringing another foreclosure suit against Patricia and Paul Deschaine of Lincoln after a lower court dismissed its previous foreclosure action “with prejudice” for failing to comply with a court order to file witness and exhibit lists.

That ruling will have a major impact on other pending foreclosure cases, says homeowner defense attorney Tom Cox of the group Maine Attorneys Saving Homes. Cox says he and another attorney intend to use the decision to appeal a dozen foreclosure cases, which will entail filing a “quiet title” action to assert that the proper owners of the properties are the occupants and not the former mortgage holders.

“I’m sitting on 8 to 10 case files right now where there have been either defense judgements for homeowners or they have been dismissals with prejudice,” said Cox, who filed an amicus brief in FNMA v. Deschaine. “Suddenly those are now affected by this decision. Any lawyer who is reasonably astute should be able to take that Deschaine decision and use it to go to court and bring a quiet title action.”

[FREE PRESS ONLINE]

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Statement of Acting United States Attorney David C. Weiss on the Wilmington Trust Corporation Settlement

Statement of Acting United States Attorney David C. Weiss on the Wilmington Trust Corporation Settlement

FOR IMMEDIATE RELEASE
Tuesday, October 10, 2017

Statement of Acting United States Attorney David C. Weiss on the Wilmington Trust Corporation Settlement

“Wilmington Trust Company (WT) has been a fixture in this community for more than 100 years. This is why the bank’s decline and the fire sale acquisition by M&T Bank was such a significant development in this community; and why this office has invested substantial time, energy and resources in the investigation and prosecution of this case.

The United States Attorney’s Office fort the District of Delaware has reached a resolution with WT. The key terms, from our perspective, are as follows:

  • WT admits that it agreed to submit Monthly Regulatory Reports to the Federal Reserve between October 2009 and July;
  • Those reports included past due loan information.
  • The past due loan numbers submitted to the Federal Reserve did not include past due loans that WT chose to “waive.”

We say that those monthly reports were false. These facts and those set forth in the Civil Forfeiture Complaint filed earlier today, provide a basis to forfeit the proceeds of this unlawful activity.

  • As a result, WT and the USAO have agreed to a total settlement amount of $60,000,000, which credits WT with its prior payment to the SEC in the amount of $16,000,000, and requires an additional forfeiture payment of $44,000,000.
  • Further, WT agrees to cooperate with the USAO moving forward. In return, the USAO has agreed to dismiss all criminal charges pending against WT, and the parties have agreed to exchange mutual releases.

To function effectively, our financial markets require accurate disclosures—and regulators need to receive accurate information.

That didn’t happen here.

We believe today’s resolution accomplished three important objectives. First, we secured a substantial payment for victims who sustained losses as a result of what transpired. Second, WT accepted responsibility for its actions. And third, if possible, we wanted to avoid the collateral consequences of a criminal conviction for the bank, which could have resulted in the loss of jobs and revenue for our community.”

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Carbone v. CALIBER HOME LOANS, INC., | Dist. Court, ED New York – Federal Court Holds Pre-Foreclosure Notice Is Not Subject to FDCPA

Carbone v. CALIBER HOME LOANS, INC., | Dist. Court, ED New York – Federal Court Holds Pre-Foreclosure Notice Is Not Subject to FDCPA

H/T LEXOLOGY

 

JANINE CARBONE, on behalf of plaintiff and a class, Plaintiff,
v.
CALIBER HOME LOANS, INC., Defendants.

No. 15-CV-5190 (JS) (GRB).
United States District Court, E.D. New York.
September 19, 2017.
Janine Carbone, Plaintiff, represented by Abraham Kleinman, Kleinman, LLC.

Janine Carbone, Plaintiff, represented by Tiffany N. Hardy, Edelman Combs Latturner & Goodwin LLC.

Caliber Home Loans, Inc., Defendant, represented by David T. Biderman, Perkins Coie LLP, pro hac vice, Jalina Joy Hudson, Perkins Coie & Manny Joseph Caixeiro, Perkins Coie LLP.

MEMORANDUM & ORDER

JOANNA SEYBERT, District Judge.

Plaintiff Janine Carbone (“Carbone” or “Plaintiff”) filed an Amended Complaint alleging that Defendant Caliber Home Loans, Inc. violated the Fair Debt Collection Practice Act (“FDCPA”), 15 U.S.C. §§ 1692 et seq. (Am. Compl., Docket Entry 23.) Her initial Complaint failed to plausibly allege that she was a “consumer” within the meaning of the statute. Because Plaintiff has failed to cure this deficiency, the Court GRANTS Defendant’s motion to dismiss the Amended Complaint. (Mot. to Dismiss, Docket Entry 24.)

BACKGROUND

The Court assumes familiarity with the record but summarizes the relevant portions below. In doing so, the Court accepts all well-pled facts as true and draws all reasonable inferences in Plaintiff’s favor. Cleveland v. Caplaw Enters., 448 F.3d 518, 521 (2d Cir. 2006).

Carbone has a residential mortgage loan serviced by Caliber Home Loans, Inc. (Am. Compl. ¶ 15.) Carbone signed the mortgage, but her husband signed the promissory note.[1] (Id.) As a borrower, Carbone has the right to redeem the property if the principal, interests, and costs are paid. (Id. ¶ 18.) Unfortunately, the Carbones fell behind on their payments. As required by New York law, Caliber sent a pre-foreclosure notice. (Pre-Foreclosure Notice, Am. Compl. Ex. D, Docket Entry 23-4.) This notice, along with a default letter, explained, among other things: “This is an attempt by a debt collector to collect a debt and any information obtained will be used for that purpose.” (Pre-Foreclosure Notice at 3; Default Ltr., Am. Compl. Ex. E, Docket Entry 23-5, at 3 (omitting capitalization).)

Unhappy with these letters, Carbone filed this lawsuit against Caliber on September 8, 2015. (See Compl., Docket Entry 1.) She alleges that these communications contained “false, deceptive, or misleading representation[s]” in violation of Section 1692(e) of the FDCPA and legally deficient advisories in violation of Section 1692(g). (Compl. ¶¶ 30-32, 37, 43.) Caliber filed a motion to dismiss, which the Court granted. (Sept. 2016 M&O, Docket Entry 22, at 11-12.) In so ruling, the Court concluded that Carbone failed to plausibly allege that she was a “consumer” under the FDCPA and thus Caliber could not have violated Sections 1692(e) or (g). (Id. at 6-11.)

Plaintiff amended her Complaint on October 31, 2016. While this new version amplifies a few facts, none help her cause. (See, e.g., Am. Compl. ¶¶ 16-19.) As a result, the Court grants Defendant’s motion to dismiss the Amended Complaint.[2]

DISCUSSION

I. Standard of Review

To avoid dismissal, a complaint must plead “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 1974, 167 L. Ed. 2d 929 (2007). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 1949, 173 L. Ed. 2d 868 (2009).

II. FDCPA Claims

To assert a claim under the FDCPA, a plaintiff must allege, among other things, that she is a “consumer.” Polanco v. NCO Portfolio Mgmt., Inc., 132 F. Supp. 3d 567, 578 (S.D.N.Y. 2015) (citing Plummer v. Atl. Credit & Fin., Inc., 66 F. Supp. 3d 484, 488 (S.D.N.Y. 2014)). The FDCPA defines a “consumer” as “any natural person obligated or allegedly obligated to pay any debt.” 15 U.S.C. § 1692a(3).

To date, the Second Circuit Court of Appeals has not addressed “whether the initiation of a foreclosure action is done in connection with the collection of any debt.” Carlin v. Davidson Fink LLP, 852 F.3d 207, 213 n.1 (2d Cir. 2017) (internal quotation marks and citation omitted). It is true, as Plaintiff argues (Pl.’s Br. at 14), that the Sixth Circuit classifies mortgage foreclosure as “debt collection under the FDCPA.” Glazer v. Chase Home Fin. LLC, 704 F.3d 453, 461 (6th Cir. 2013). But “[t]he Sixth Circuit’s rationale in Glazer has been rejected by numerous other Circuits,” including the Fifth, Ninth, and Eleventh Circuits. Salewske v. Trott & Trott P.C., No. 16-CV-13326, 2017 WL 2888998, at *5 n.2 (E.D. Mich. July 7, 2017) (collecting cases); Aurora Loan Servs., LLC v. Kmiecik, 992 N.E.2d 125, 133 (Ill. App. Ct. 2013) (“It appears that the majority view is that mortgage foreclosure is not debt collection within the meaning of the FDCPA.”). After all, a mortgage is a security interest, not a payment obligation. Hill v. DLJ Mortg. Capital, Inc., No. 15-CV-3083, 2016 WL 5818540, at *7 (E.D.N.Y. Oct. 5, 2016), aff’d on other grounds, 689 F. App’x 97 (2d Cir. 2017). And “[t]he object of a non-judicial foreclosure is to retake and resell the security, not to collect money from the borrower.” Vien-Phuong Thi Ho v. ReconTrust Co., NA, 858 F.3d 568, 572 (9th Cir. 2016), pet. for cert. docketed, No. 17-278 (U.S. Aug. 22, 2017).

Pre-foreclosure notices, like the one Caliber sent, “are entirely different from the harassing communications that the FDCPA was meant to stamp out.” Id. at 574. In fact, New York law requires that these notices be disseminated to protect homeowners. See N.Y. REAL PROP. ACTS. LAW § 1304(1); Avail Holding LLC v. Ramos, No. 15-CV-7068, 2017 WL 979027, at *2 (E.D.N.Y. Mar. 10, 2017) (“In response to the mortgage foreclosure crisis, New York enacted . . . a series of legal protections and foreclosure prevention opportunities to homeowners at risk of losing their homes.”).[3]

Of course, Caliber’s Pre-Foreclosure Notice contained debt-demand language: “This is an attempt by a debt collector to collect a debt and any information obtained will be used for that purpose.” (Pre-Foreclosure Notice at 3; Default Ltr. at 3 (omitting capitalization).) “This statement, however, does not convert the non-judicial foreclosure into an attempt to collect a debt under the FDCPA.” Evalobo v. Aldridge Pite, LLP, No. 16-CV-0539, 2016 WL 7379021, at *5 (D. Nev. Dec. 20, 2016) (analyzing nearly identical language) (citation omitted). As noted above, Caliber sent its notice to meet statutory requirements, not to collect any debt. Thus, Mrs. Carbone has failed to plausibly allege that she is a “consumer” under the FDCPA. She is not “allegedly obligated to pay a[ ] debt,” 15 U.S.C. § 1692a(3), and so her claims under Sections 1692(e) and (g) fail for that reason.

III. Leave to Amend

“When a motion to dismiss is granted, the usual practice is to grant leave to amend the complaint,” Hayden v. Cty. of Nassau, 180 F.3d 42, 53 (2d Cir. 1999), unless doing so would be futile, Darden v. DaimlerChrysler N. Am. Holding Corp., 191 F. Supp. 2d 382, 399 (S.D.N.Y. 2002). Carbone already filed an Amended Complaint and failed to identify other communications from Caliber that could be construed as attempts to collect a debt against her and thus serve as the basis for FDCPA claims. On that basis, the Court DENIES leave to amend.

CONCLUSION

Defendant’s motion to dismiss (Docket Entry 24) is GRANTED, and Plaintiff’s claims are DISMISSED WITH PREJUDICE. The Clerk of the Court is directed to enter judgment in favor of Defendant and mark this matter CLOSED.

SO ORDERED.

[1] Michael Carbone filed a separate lawsuit, which is currently pending. See Case No. 15-CV-4914 (E.D.N.Y.).

[2] Carbone raises a number of subsidiary arguments, which the Court already rejected in its prior order. (Sept. 2016 M&O at 9-10.) In short, Carbone attached “Federal Truth-in-Lending Disclosure Statements,” (TILA Stmts., Am. Compl. Ex. B, Docket Entry 23-2), but the Amended Complaint, like the initial version, asserts no TILA violations. And contrary to Plaintiff’s assertions (Pl.’s Br., Docket Entry 26, at 6-7), only a consumer can bring Section 1692(e) claims, Papetti v. Rawlings Fin. Servs., LLC, 121 F. Supp. 3d 340, 348, 353 (S.D.N.Y. 2015).

[3] At any rate, out-of-circuit courts have permitted FDCPA claims if the debt collector also seeks a deficiency judgment. Kabir v. Freedman Anselmo Lindberg LLC, No. 14-CV-1131, 2015 WL 4730053, at *4 (N.D. Ill. Aug. 10, 2015)Goodin v. Bank of Am., N.A., 114 F. Supp. 3d 1197, 1206-07 (M.D. Fla. 2015). But in New York, “defendants cannot file a motion for a deficiency judgment against plaintiff until after the foreclosure sale,” so Caliber has “not engaged in any conduct related to the collection of money to date.” See Hill, 2016 WL 5818540, at *7, n.9.

 

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Ocwen settles servicing lawsuit with 10 states

Ocwen settles servicing lawsuit with 10 states

National Mortgage News-

Ocwen Financial has reached a settlement with 10 states under which it may not acquire servicing rights for eight months but will avoid financial penalties.

The settlement does not end the lawsuits filed in April against the West Palm Beach, Fla., company by the Consumer Financial Protection Bureau and 19 other states. In response, Ocwen sued the CPFB, challenging its constitutionality.

Allegations that Ocwen mishandled escrow accounts were at the heart of the actions brought by the 10 states that took part in the settlement, and are the subject of the pending suits.

[NATIONAL MORTGAGE NEWS]

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Millions For Homeowners Facing Foreclosure Squandered By State Agencies

Millions For Homeowners Facing Foreclosure Squandered By State Agencies

Forbes-

Novelist Thomas Wolfe once wrote that he marveled how “a silver dollar, if held close enough to the eye, could blot out the sun itself.”

That may apply to some administrators of the Hardest Hit Fund, which was created in 2010 to assist state housing finance agencies help homeowners in danger of foreclosure. Unfortunately, a number of them viewed the funds as a private piggy bank.

More than $7.6 billion was destined for low-income homeowners facing foreclosure, with the Department of the Treasury last year committing an additional $2 billion to the fund. Any expense the state agencies charged to the program were supposed to be essential to easing loan modifications, according to federal guidelines.

[FORBES]

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Wells Fargo Offering Refunds Nationwide for Improper Mortgage Fees

Wells Fargo Offering Refunds Nationwide for Improper Mortgage Fees

Propublica-

In a scandal that extended wider than was previously known, Wells Fargo said it would offer refunds to tens of thousands of customers who were improperly charged fees on home mortgages.

ProPublica first reported earlier this year that the bank was chiseling customers by making them pay to extend interest rates on loans even when the delays were the bank’s fault. Current and former employees said at the time that the practice was especially prevalent in the Los Angeles area and Oregon. As it turns out, about 10 percent of the affected mortgages were in those two regions, and the rest were scattered nationwide, according to a person familiar with the issue. A Wells Fargo spokesman did not immediately return a call for comment.

As is typical in home loans, Wells Fargo allowed customers to lock in a promised mortgage rate for a given period of time. When a deadline for mortgage paperwork was missed, a fee would be incurred. Even when the bank was responsible for the delay, management frequently forced loan officers to blame the customers and charge them. The fees were typically about $1,000 to $1,500, depending on the size of the loan.

[PROPUBLICA]

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TFH 10/ 8 | Foreclosure Workshop #47: Burciaga v. Deutsche Bank National Trust Company; and S&A Capital Partners, Inc. v. JP Morgan Chase — Homeowners Unite!

TFH 10/ 8 | Foreclosure Workshop #47: Burciaga v. Deutsche Bank National Trust Company; and S&A Capital Partners, Inc. v. JP Morgan Chase — Homeowners Unite!

COMING TO YOU LIVE DIRECTLY FROM THE DUBIN LAW OFFICES AT HARBOR COURT, DOWNTOWN HONOLULU, HAWAII

LISTEN TO KHVH-AM (830 ON THE AM RADIO DIAL)

ALSO AVAILABLE ON KHVH-AM ON THE iHEART APP ON THE INTERNET

.

.

Sunday – October 8

 ———————
Foreclosure Workshop #47: Burciaga v. Deutsche Bank National Trust Company; and S&A Capital Partners, Inc. v. JP Morgan Chase — Homeowners Unite!

 

 

James Madison warned upon the adoption of the United States Constitution that the new American Government needed to beware of being controlled by organized “factions” whose interests were in conflict with those of the general public.

The only remedy he envisioned was for factions to compete against one another, and there quickly appeared American lobby groups at both the state and federal levels influencing if not outright controlling in many instances legislation in the United States under the Free Speech Amendment.

Led by lobbyists representing medicine, agriculture, labor, business, transportation, finance, and other leading industries, such groups today are often called the Fourth Estate.

Their interests are diverse, from the Girl Scouts, Big Tobacco, the National Rifle Association, the American Hospital Association, AT&T, the Chamber of Commerce, the National Association of Realtors, as well as a plethora of foreign governments, such as the United Arab Republic, Germany, Canada, Saudi Arabia, Mexico, and South Korea, to name only a few — all collectively spending nearly a trillion dollars yearly influencing legislation.

And one of the worst offenders are America’s financial institutions, state and local, who not only regularly fill the campaign treasuries of legislators, but who have controlled, especially in recent years, the top jobs at the U.S. Treasury Department, the Federal Deposit Insurance Corporation, and the Federal Reserve Board.

There is little wonder then that state and federal laws have favored the big banks, such as JP Morgan Chase, the Bank of America, and Wells Fargo, who have spent hundreds of millions of dollars annually influencing if not outright controlling American governments no matter how brazen their mortgage abuses have been.

And in the process, by spreading their wealth throughout the legal profession, they have been able to corrupt that industry as well by retaining America’s major law firms to represent them and even to submit fraudulent loan documents in court with little concern for sanctions, enticed and protected by large financial retainers to conveniently look the other way.

With no one nationally representing homeowners, even our courts have been discriminating against homeowners, refusing to provide the evidentiary and even the jurisdictional protections that complaining parties in nonforeclosure civil cases enjoy as a matter of right.

Two recent examples, the Burciaga Case and S&R Capital Case, the joint subject of today’s radio show, illustrate the total disregard today of the rights of America’s homeowners.

When will enough be enough?

Madison gave us the answer: Homeowners must unite and become a viable competitive force or nothing is going to change.

Other segments of the population, few as large of the number of American homeowners, throughout American history, such as labor groups, racial groups, gender groups, and so forth have similarly in their own way been discriminated against and have found relief only in eventually uniting by raising funds, sponsoring a platform, organizing their membership, educating society, and winning alliances.

That is what American Homeowners urgently need to do. How? Listen to today’s show, posted on our website at www.foreclosurehour.com, and find out how you can change American history, beat the banks, by joining the Homeowners SuperPAC today.

.
Host: Gary Dubin Co-Host: John Waihee

.

CALL IN AT (808) 521-8383 OR TOLL FREE (888) 565-8383

Have your questions answered on the air.

Submit questions to info@foreclosurehour.com

The Foreclosure Hour is a public service of the Dubin Law Offices

Past Broadcasts

EVERY SUNDAY
3:00 PM HAWAII
6:00 PM PACIFIC
9:00 PM EASTERN
ON KHVH-AM
(830 ON THE DIAL)
AND ON
iHEART RADIO

The Foreclosure Hour 12

 

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BofA Judge Balks at Ripping Up Scathing Foreclosure Ruling

BofA Judge Balks at Ripping Up Scathing Foreclosure Ruling

Bloomberg-

A bankruptcy judge who spent 107 pages excoriating Bank of America Corp. over its “heartless” foreclosure on a California couple is not happy that the homeowners want him to erase his words.

The couple reached a private settlement with the bank that calls for rescinding both the $45 million penalty the judge imposed on the lender and the scathing ruling he issued in March — for which Money magazine called him a “Hero Judge.”

“So you want me to take the injunction and tear it up and throw it out,” U.S. Bankruptcy Judge Christopher Klein asked during a hearing Wednesday in Sacramento. He then explained that if the opinion is vacated, it will be expunged from the annals of law and can’t be cited as a precedent in other foreclosure abuse cases.

[BLOOMBERG]

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Join your fellow homeowners. Sign up as a Member of the Homeowners SuperPAC. Click on and send in your Membership Application today!

Join your fellow homeowners. Sign up as a Member of the Homeowners SuperPAC. Click on and send in your Membership Application today!

*The Homeowners SuperPAC is federally registered, just now actively organizing throughout the United States. We do not endorse political candidates or political parties, but instead seek to educate judges, lawyers, legislators, legal educators, homeowners, and the general public to bring about needed reforms.

Annual membership fees are $100 for each individual. If you wish to contribute more, we ask that you do so by financially helping others to app¡y for membership(s) instead in their own name(s) at $100 each.

First, SuperPACs have very detailed accounting requirements that make accounting for small contributions comparatively expensive and unduly burdensome. To save accounting costs, it is expeditious to account for all contributions in the same amount of $10O the lowest amount feasible in terms of accounting costs for a SuperPAC. Of course, if you wish to make a major financial contribution personally we will be pleased to ass¡st you; please email us at info@foreclosurehour.com.

Second, to be effective we not only need to raise a significant amount of money, but we also need to have a significant amount of members. There are five big banks and about one-hundred securitized trusts, compared to one-hundred million homeowners in the United States. Our goal is to raise $100 from one million homeowners 1% of all homeowners in the United States). Achieving anywhere near that goal will surely get us the attention and secure the changes needed.

All Members will exclusively receive free periodic newsletters regard the progress of your Homeowners SuperPAC and other materials as we expand. The ultimate direction and success of the Homeowners SuperPAC will be the responsibility of our State D¡rectors, whose activities will be reported in our Newsletter. For details concerning the goals of the Homeowners SuperPAC, please listen to Gary’s and John’s past broadcasts found on www.foreclosure hour.com, especially their October l, 2O17 radio show.

20171001233827_1_1 by DinSFLA on Scribd

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Nevada Supreme Court Rules HOA Super-Priority Liens Can Be Revived after Release

Nevada Supreme Court Rules HOA Super-Priority Liens Can Be Revived after Release

LEXOLOGY-

Homeowners’ associations have a more robust tool for forcing mortgage lenders to pay delinquent assessments following a September 14 decision by the Nevada Supreme Court. Nevada HOAs have enjoyed a super-priority lien under NRS 116.3116 for nine months of unpaid assessments preceding institution of foreclosure proceedings, in addition to certain charges for maintenance and nuisance abatement. In Property Plus Investments, LLC, v. Mortgage Electronic Registration Systems, Inc., the court found that this super-priority lien is not a “one-shot offer,” but can be revived even after a previous super-priority lien has been discharged.

In Property Plus, the HOA recorded a notice of lien in 2010 for unpaid assessments on a property securing a $215,000 mortgage loan. The loan servicer for the mortgage lender attempted to pay $522 to the HOA, representing nine months’ worth of assessments, but the HOA rejected the payment. Subsequently, the property owner entered a payment plan with the HOA, and the HOA released the 2010 lien. In 2012, however, the HOA recorded a second notice of lien for unpaid assessments. That time, the property went to a foreclosure sale and sold to a new owner for $7,500. The purchaser at the sale then brought a quiet title suit, claiming that the sale foreclosed on the HOA’s super-priority lien and extinguished the first mortgage. The lender countered that its $522 payment extinguished the super-priority portion of the lien and that any foreclosure thereafter could not impact the mortgage.

[LEXOLOGY]

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Move over Pam Bondi Manhattan DA dropped criminal case against Trump children. Then he received a big $25,000 check

Move over Pam Bondi Manhattan DA dropped criminal case against Trump children. Then he received a big $25,000 check

TRD-

Why did Manhattan District Attorney Cyrus Vance Jr. abruptly drop a criminal case against Donald Trump Jr. and Ivanka Trump in August 2012? A new report suggests money may have something to do with it.

The DA’s office believed the Trump children repeatedly lied to condo buyers by inflating their sales success at the Trump Soho development, had solid email evidence to support it, and were deep into a criminal investigation, according to a joint report by ProPublica, the New Yorker and WNYC. Then, on Aug. 3, 2012, Vance dropped the case. The decision came four months after a private meeting between Vance and Trump’s personal attorney Marc Kasowitz.

A month after the decision, in September, Kasowitz contacted Vance’s campaign about hosting a fundraiser for his re-election that would raise $32,000 in January. He raised another $9,000 at another fundraiser in October 2013. And Kasowitz had also donated $25,000 to Vance in early 2012, although the DA returned that money prior to the meeting.

[TRD]

 

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FRIEDLE v. BANK OF NEW YORK MELLON |  FL 4DCA – Bank failed to prove its standing at the filing of suit … We reverse and remand for vacation of the final judgment and entry of an involuntary dismissal of the complaint.

FRIEDLE v. BANK OF NEW YORK MELLON | FL 4DCA – Bank failed to prove its standing at the filing of suit … We reverse and remand for vacation of the final judgment and entry of an involuntary dismissal of the complaint.

 

JUSTIN FRIEDLE and SANDRA FRIEDLE, Appellants,
v.
THE BANK OF NEW YORK MELLON, f/k/a THE BANK OF NEW YORK, as successor-in-interest to JPMORGAN CHASE BANK, N.A., as trustee for STRUCTURED ASSET MORTGAGE INVESTMENTS II INC., BEAR STEARNS ALT-A TRUST, MORTGAGE PASSTHROUGH CERTIFICATES, SERIES 2005-10, Appellee.

No. 4D15-1750.
District Court of Appeal of Florida, Fourth District.
September 27, 2017.
Appeal from the Circuit Court for the Seventeenth Judicial Circuit, Broward County, L.T. Case No. CACE12-32115, Kathleen D. Ireland, Judge.

Thomas Erskine Ice of Ice Appellate, Royal Palm Beach, for appellants.

William L. Grimsley and N. Mark New, II of McGlinchey Stafford, Jacksonville, for appellee.

William P. Keller of Akerman LLP, Fort Lauderdale, and Nancy M. Wallace of Akerman LLP, Tallahassee, for Amicus Curiae Mortgage Bankers Association.

ON MOTION FOR REHEARING

WARNER, J.

We grant the motions for rehearing and clarification filed by appellee and amicus, withdraw the opinion, and substitute the following opinion in its place.

Appellants challenge a final judgment of foreclosure, contending that the Bank failed to prove standing. Because the appellee did not prove that the Bank had possession of the note and was thus a holder at the time of the filing of the complaint, we reverse.

The standard of review in determining whether a party has standing to bring an action is de novo. Boyd v. Wells Fargo Bank, N.A., 143 So. 3d 1128, 1129 (Fla. 4th DCA 2014). To prove standing in a mortgage foreclosure case, the plaintiff must prove its status as a holder of the note at the time of the filing of the complaint as well as at trial. See Rigby v. Wells Fargo Bank, N.A., 84 So. 3d 1195 (Fla. 4th DCA 2012). In this case, the foreclosing bank’s witness could not testify that the Bank had possession of the note prior to filing the complaint. The Bank conceded that it presented no testimony that its present servicer or its prior servicer had possession of the note at the inception of the foreclosure action.

At trial, the Bank attempted to prove possession of the note through a Pooling and Service Agreement (“PSA”). That document purports to show the transfer of the mortgage loan to the Bank as trustee. Appellant objected to the admission of this evidence, which the court allowed on the ground that it was self-authenticating under section 90.902, Florida Statutes (2016). While it was certified by the Securities and Exchange Commission (“SEC”) as being filed with that agency, and thus was self-authenticating, there is a difference between authentication and admissibility. Charles Ehrhardt explains the difference:

Documents must be authenticated before they are admissible evidence. . . . Even after a document is authenticated, it will not be admitted if another exclusionary rule is applicable. For example, when a document is hearsay, it is inadmissible even if it has been properly authenticated.

Charles W. Ehrhardt, Florida Evidence § 902.1 (2017 ed.). Here, the PSA purportedly establishes a trust of pooled mortgages, but this particular mortgage was not referenced in the documents filed with the SEC. Appellant objected that the document was hearsay, as none of the exceptions to the hearsay rule were established. The Bank did not present sufficient evidence through its witness to admit this unsigned document as its business record. While the witness testified that a mortgage loan schedule, which listed the subject mortgage, was part of the Bank’s business records, the mortgage loan schedule itself does not purport to show that the actual loan was physically transferred. And it is clear from the testimony that the witness had no knowledge of the workings of the PSA or MLS, nor did any other document or testimony show that the note was transferred to the Bank in accordance with the terms of the PSA. Therefore, the evidence in this case does not establish that this mortgage note was within the possession of the Bank as Trustee at the time suit was filed.[1]

In its answer brief, the Bank also relies on Ortiz v. PNC Bank, National Ass’n, 188 So. 3d 923 (Fla. 4th DCA 2016), to support the court’s rulings under a tipsy coachman analysis. In Ortiz, we created a presumption of standing if the note attached to the complaint was the same as the note introduced at trial. We said:

[I]f the Bank later files with the court the original note in the same condition as the copy attached to the complaint, then we agree that the combination of such evidence is sufficient to establish that the Bank had actual possession of the note at the time the complaint was filed and, therefore, had standing to bring the foreclosure action, absent any testimony or evidence to the contrary.

Id. at 925 (emphasis added). Here, the note attached to the complaint was not in the same condition as the original note introduced at trial, as pointed out by the appellants in their reply brief. Although the differences may seem minor, Ortizinfers possession at the time of filing suit where the copy attached to the complaint and the original are the same, as the copy must have been made from the original note at the time that the complaint was filed, without evidence to the contrary. Where the copy differs from the original, the copy could have been made at a significantly earlier time and does not carry the same inference of possession at the filing of the complaint. In this case, as Ortiz had not been decided at the time of the trial, no effort was made to explain the discrepancies in the condition of the note attached to the complaint or the original introduced into evidence. Thus, reliance on Ortiz under a tipsy coachman analysis is not appropriate on the record made in this case. Although appellate courts generally apply the law in effect at the time of the appellate court’s decision, Florida East Coast Railway Co. v. Rouse,194 So. 2d 260, 262 (Fla. 1966), the record must be sufficiently developed to support an alternative theory for affirmance. See State Farm Fire and Casualty Co v. Levine, 837 So. 2d 363 (Fla. 2002) (ruling that the court could not affirm a decision based on an alternative legal theory where the alternate ground had not been developed in the record, stating “The key to applying the tipsy coachman doctrine, permitting a reviewing court to affirm a decision from a lower tribunal that reaches the right result for the wrong reasons, is that the record before the trial court must support the alternative theory or principle of law.”).

Because the Bank failed to prove its standing at the filing of suit, the court erred in entering the final judgment of foreclosure. We reverse and remand for vacation of the final judgment and entry of an involuntary dismissal of the complaint.

TAYLOR and LEVINE, JJ., concur.

[1] We have held in past cases that the PSA together with a mortgage loan schedule are sufficient to prove standing, but in those cases the witness offering the evidence appears to have been able to testify to the relationship of the various documents and their workings, or that the documents were admitted into evidence without objection. See, e.g., Boulous v. U.S. Bank Nat’l Ass’n., 210 So. 3d 691 (Fla. 4th DCA 2016).

 

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Exclusive: U.S. mulls further Wells Fargo sanction over sales abuses – source

Exclusive: U.S. mulls further Wells Fargo sanction over sales abuses – source

Reuters-

The main regulator for Wells Fargo & Co (WFC.N) is considering whether to sanction the U.S. bank over improperly charging customers for car insurance and mortgage loans, according to a source familiar with the matter.

The Office of the Comptroller of the Currency (OCC) has for weeks debated how to take action on the insurance and mortgage issues which came to light this summer, said the source.

And officials are considering whether to fault the bank for older consumer lending issues, said two sources familiar with the moves.

[REUTERS]

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DAVID KESTER V. CITIMORTGAGE, INC. | 9th Cir –  “the recording of false or fraudulent documents that assert an interest in a property may cloud the property’s title”

DAVID KESTER V. CITIMORTGAGE, INC. | 9th Cir – “the recording of false or fraudulent documents that assert an interest in a property may cloud the property’s title”

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

DAVID A. KESTER, on behalf of himself
and all others similarly situated,
Plaintiff-Appellant,

v.

CITIMORTGAGE INC.; et al.,
Defendants-Appellees.

excerpt

CitiMortgage and CR Title (“Defendants”) knowingly caused the recording of
invalid property documents in violation of ARIZ. REV. STAT. (“A.R.S.”) § 33-
420(A). The district court granted Defendants’ motion to dismiss. We reverse and
remand.
1. Kester has standing to bring this action, despite the fact that A.R.S. § 33-
411(C) provides that “an instrument affecting real property containing any defect,
omission or informality in the certificate of acknowledgment and which has been
recorded for longer than one year . . . shall be deemed to have been lawfully
recorded on and after the date of its recording.”1
“The irreducible constitutional
minimum of standing consists of three elements. The plaintiff must have (1)
suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of
the defendant, and (3) that is likely to be redressed by a favorable judicial
decision.” Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547 (2016), as revised (May
24, 2016). Kester has adequately alleged all three elements. See Washington Env’tl
Council v. Bellon, 732 F.3d 1131, 1139 (9th Cir. 2013) (“The plaintiff . . . bears the
burden of proof to establish standing ‘with the manner and degree of evidence
required at the successive stages of the litigation.’ (quoting Lujan v. Defenders of
Wildlife, 504 U.S. 555, 561 (1992))).

First, “the recording of false or fraudulent documents that assert an interest
in a property may cloud the property’s title”; therefore, Kester has adequately
alleged “a distinct and palpable injury as a result of those clouds on [his former
property’s] title.” In re Mortg. Elec. Registration Sys., Inc., 754 F.3d 772, 783 (9th
Cir. 2014) (quoting Stauffer v. U.S. Bank Nat. Ass’n, 308 P.3d 1173, 1179 (Ariz.
Ct. App. 2013)). Second, this injury is fairly traceable to Defendants’ conduct:
despite receiving notice of the revocation of Kristen Lindner’s notary commission,
Defendants allegedly continued to use her notary services to execute Assignments
of Deeds of Trust, Substitutions of Trustee, Notices of Default, and Notices of
Trustee Sale for three months. Third, Kester’s “injury would be redressed by an
award of statutory damages, which [A.R.S. § 33-420(A)] makes available to
prevailing [former property owners].” See Tourgeman v. Collins Fin. Servs., Inc.,
755 F.3d 1109, 1116 (9th Cir. 2014), as amended on denial of reh’g and reh’g en
banc (Oct. 31, 2014).

2. The district court incorrectly held that A.R.S. § 33-420(A) requires Kester
to allege “material” invalidity in the trustee’s sale documents. Arizona caselaw
does not clearly resolve the question whether a plaintiff must allege materiality to
[…]

David Kester v. Citimortgage, Inc. by DinSFLA on Scribd

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Nomura, RBS lose bid to overturn $839 million mortgage bond award

Nomura, RBS lose bid to overturn $839 million mortgage bond award

REUTERS-

Nomura Holdings Inc (8604.T) and Royal Bank of Scotland Group Plc (RBS.L) lost a U.S. court appeal on Thursday to overturn an order requiring them to pay $839 million for making false statements while selling mortgage-backed securities to Fannie Mae (FNMA.PK) and Freddie Mac(FMCC.PK).

The two banks had challenged the 2015 award on multiple grounds, including that the loss of the securities’ value was largely caused not by any false statements, but by the broader financial crisis in 2008.

A unanimous panel of the U.S. Court of Appeals for the 2nd Circuit in New York, however, rejected that and other arguments.

[REUTERS]

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in STOP FORECLOSURE FRAUD0 Comments

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