Wolf v. Wells Fargo Bank, N.A. et al, No. 3:2011cv01337 - Document 50 (N.D. Cal. 2011)
Court Description: ORDER GRANTING DEFENDANTS' MOTION TO EXPUNGE NOTICE OF PENDING ACTION, DENYING DEFENDANTS' ATTORNEYS FEES, AND VACATING HEARING by Judge William Alsup [granting in part and denying in part 45 Motion]. (whasec, COURT STAFF) (Filed on 10/4/2011)
Download PDF
<![CDATA[
Wolf v. Wells Fargo Bank, N.A. et al Doc. 50 1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE NORTHERN DISTRICT OF CALIFORNIA 8 9 JULIE ANN WOLF, 11 For the Northern District of California United States District Court 10 12 13 14 15 16 17 18 19 20 No. C11-01337 WHA Plaintiff, v. WELLS FARGO BANK, N.A., ALSO KNOWN AS WACHOVIA MORTGAGE, A DIVISION OF WELLS FARGO BANK, N.A., FORMERLY KNOWN AS WACHOVIA MORTGAGE, FSB, AND FORMERLY KNOWN AS WORLD SAVINGS BANK, FSB, FORMERLY KNOWN AS WORLD SAVINGS BANK, FSB, NDEX WEST, LLC, GOLDEN SAVINGS ASSOCIATION SERVICE COMPANY, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., GUARANTEE MORTGAGE, and DOES 1 through 100, inclusive, ORDER GRANTING DEFENDANTS’ MOTION TO EXPUNGE NOTICE OF PENDING ACTION, DENYING DEFENDANTS’ ATTORNEY’S FEES, AND VACATING HEARING Defendants. / 21 22 23 INTRODUCTION In this foreclosure dispute, defendants Wachovia Mortgage, Golden West Savings, and 24 MERS move to expunge notices of pending action and request attorney’s fees in conjunction 25 with this motion. For the reasons stated below, the motion to expunge is GRANTED. 26 Defendants’ request for attorney’s fees is DENIED. 27 STATEMENT 28 Defendants participate in the mortgage-servicing business. Plaintiff Julie Ann Wolf acquired a one-third interest in the subject property in San Mateo upon the death of her father. Dockets.Justia.com 1 In June 2007, plaintiff obtained a $510,000 loan at a 7.300% interest rate from World Savings 2 Bank, FSB (now Wachovia Mortgage, a division of Wells Fargo Bank, N.A.). The loan was 3 secured by a first priority deed of trust against the subject property listing Golden West Savings 4 Association Service Co. as the trustee and World Savings as the beneficiary, and it was recorded 5 by a promissory note. Defendant Mortgage Electronic Registration Systems, Inc. was the initial 6 nominal beneficiary on the Deed of Trust (First Amd. Compl. ¶¶ 2–4, 10, 21). 7 Plaintiff fell behind on her mortgage payments, allegedly due in part to accounting received a discharge in November 2010 (id. ¶ 22). A notice of default was recorded on the loan, 10 and then a trustee’s sale was held in December 2010, at which Wachovia was the purchaser of the 11 For the Northern District of California mistakes by the defendants. In August 2010, plaintiff filed for Chapter 7 bankruptcy, and she 9 United States District Court 8 property. 12 Plaintiff commenced this action in San Mateo County Superior Court in December 2010. 13 Defendant removed the action in March 2011 (Dkt. No. 1). Plaintiff then filed an amended 14 complaint in July alleging fourteen claims: (1) breach of fiduciary duty; (2) breach of the 15 covenant of good faith and fair dealing; (3) deceit in violation of California Civil Code Sections 16 1709–1710; (4) violation of Business and Professions Code Section 17200; (5) promissory 17 estoppel; (6) fraud by intentional misrepresentation; (7) fraud by concealment; (8) unjust 18 enrichment; (9) quiet title; (10) violation of the California Rosenthal Act; (11) declaratory relief; 19 (12) rescission/cancellation of void instrument; (13) accounting; and (14) violation of California 20 Civil Code Section 2934a (d), (e). 21 Plaintiff alleges that neither World Savings nor Guarantee provided her with full 22 disclosure of the terms of the loan prior to her signing the loan agreement, including complete 23 documentation of the loan, a loan origination agreement, or a written loan brokerage agreement. 24 Further, plaintiff alleges that her income and assets were never verified by the defendants, and her 25 income did not allow her to qualify for the subject loan. Defendants’ failure to place plaintiff into 26 a proper loan which she understood and qualified for has placed plaintiff in “dire financial straits” 27 and in “great danger of foreclosure” (First Amd. Compl. ¶¶ 29–32). 28 2 1 At some point in time, plaintiff also applied for a loan modification and alleges that 2 defendants encouraged her to do so. The processor of the loan-modification application told her 3 that the foreclosure “clock would stop” during the modification process, but it did not. Plaintiff 4 contends that the processor seemed to intentionally stall the process by losing paperwork and 5 failing to return phone calls. Moreover, payments made by plaintiff were either misapplied or not 6 credited to her outstanding obligation, including one payment for $6,000. Plaintiff asserts these 7 accounting inaccuracies render the notice of default void due to substantial error (id. ¶¶ 38–39). 8 Plaintiff asserts that she only recently became aware of the violations by defendants in 9 procuring her a loan. She believed that World Savings would provide her with the “best loan available to her needs.” “Plaintiff had relied on the statements and actions of Defendants, placing 11 For the Northern District of California United States District Court 10 her faith and confidence in the relationship between Plaintiff and the Defendants to lull her into 12 a false sense of security and misdirect her from the illegal acts of Defendants as alleged . . .” 13 (id. ¶¶ 37, 41, 61). 14 Based on her claims, plaintiff filed a lis pendens in pro per on December 16, 2010. 15 After retaining counsel, she file an amended lis pendens on July 15, 2011 (Rapkine Decl. Exhs. 16 A–B). Defendants Wachovia Mortgage, Golden West, and MERS now move to expunge 17 plaintiff’s notices of pending action. Defendants NDEX West and Guarantee Mortgage are not 18 moving parties. This order follows full briefing. 19 ANALYSIS STANDARD. 20 1. 21 Federal courts look to the law of the state where the property resides in matters concerning 22 lis pendens. See 28 U.S.C. 1964. California law provides, “[a] party to an action who asserts a 23 real property claim may record a notice of pendency of action in which that real property claim is 24 alleged.” CAL. CIV. PROC. CODE § 405.20. California also sets prerequisites to recording the 25 notice in Section 405.21: 26 27 28 An attorney of record in an action may sign a notice of pendency of action. Alternatively, a judge of the court in which an action that includes a real property claim is pending may . . . approve a notice of pendency of action. A notice of pendency of action shall not be recorded unless (a) it has been signed by the attorney of record, (b) it is signed by a party acting in propria persona and 3 1 approved by a judge as provided in this section, or (c) the action is subject to Section 405.6 [governing eminent domain]. 2 In opposition to a motion to expunge, the party who recorded the notice of lis pendens has the 3 burden of proof. Id. § 405.30. In order to carry the burden, the recording party must 4 demonstrate that “the pleading on which the notice is based does . . . contain a real property 5 claim” and establish “by a preponderance of the evidence the probable validity of the real 6 property claim.” Id. §§ 405.31, 405.32. A real property claim is defined as a claim in a pleading 7 “which would, if meritorious, affect (a) title to, or the right to possession of, specific real 8 property.” Id. § 405.4. Probable validity “means that it is more likely than not that the claimant 9 will obtain a judgment against the defendant on the claim.” Id. § 405.3. 10 2010 LIS PENDENS. Plaintiff filed a lis pendens in pro per on December 16, 2010. The only way an individual For the Northern District of California United States District Court 2. 11 12 in pro per can record a notice of pendency of action is with the approval of a judge. Id. § 405.21 13 (“A notice of pendency of action shall not be recorded unless (a) it has been signed by the 14 attorney of record, (b) it is signed by a party acting in propria persona and approved by a judge 15 as provided in this section, or (c) the action is subject to Section 405.6 [governing eminent 16 domain].”). Plaintiff does not dispute the fact that she acted in pro per to record the lis pendens, 17 nor does she contend that she acted in accordance with approval from a judge. She merely 18 asserts in her opposition to this motion that her subsequent 2011 lis pendens was properly 19 recorded. The 2010 lis pendens therefore fails as a matter of law. Accordingly, defendants’ 20 motion to expunge the 2010 lis pendens is GRANTED. 21 3. 2011 LIS PENDENS. 22 Plaintiff’s complaint “seeks the imposition of a constructive trust on Subject Property, 23 currently held by Defendant W[achovia].” Plaintiff contends that her lis pendens was required 24 by law to be recorded in conjunction with her claim to quiet title. She does not contend that any 25 of her other claims are the basis for recording the lis pendens, so this order will only address her 26 claim to quiet title (Opp. 4). Plaintiff, however, fails to carry her burden of establishing by a 27 preponderance that it is more likely than not that she will obtain a judgment against defendants 28 on her claim to quiet title. 4 1 It is plaintiff’s burden to show that her claim to quiet title is a real property claim, and 2 she must establish the probable validity of the quiet-title claim by a preponderance of the 3 evidence. A claim to quiet title is a real property claim by definition because it must include “[a] 4 prayer for the determination of the title of the plaintiff against the adverse claims.” CAL. CIV. 5 PROC. CODE § 761.020. Plaintiff contends that she pled all of the required elements to state a 6 claim for relief to quiet title in her first amended complaint (Opp. 4). This, however, is not 7 enough to meet the standard on this motion. wrongfully foreclosed upon by defendants. Specifically, she argues that defendants violated 10 California Civil Code Sections 2932.5 and 2934a during and before the foreclosure process 11 For the Northern District of California Plaintiff asserts that she will succeed in her claim to quiet title because her home was 9 United States District Court 8 (Opp. 5–6). 12 13 A. California Civil Code Section 2934a. Plaintiff alleges that defendants violated California Civil Code Section 2934a, rendering 14 the subsequent foreclosure sale unlawful. Section 2934a(d) states, “[a] trustee named in a 15 recorded substitution of trustee shall be deemed to be authorized to act as the trustee under the 16 mortgage or deed of trust for all purposes from the date the substitution is executed by the 17 mortgagee, beneficiaries, or by their authorized agents.” Subsection (e) adds: 18 19 20 Notwithstanding any provision of this section or any provision in any deed of trust, unless a new notice of sale containing the name, street address, and telephone number of the substituted trustee is given pursuant to Section 2924f after execution of the substitution, any sale conducted by the substituted trustee shall be void. 21 Plaintiff asserts that the notice of default was recorded on May 14, 2010, but the substitution of 22 trustee was recorded on May 25. The notice of trustee’s sale was not recorded until July 15 23 (Opp. 6; Repl. 5). Plaintiff asserts that the notice of default was not properly recorded because 24 NDEX had not yet substituted in as trustee. Not so. As defendants point out, Section 2934a, 25 subsection (c) allows the notice of default to be recorded before the substitution of trustee 26 (Reply Br. 5). Subsection (c) states: 27 28 If the substitution is effected after a notice of default has been recorded but prior to the recording of the notice of sale, the beneficiary or beneficiaries or their authorized agents shall cause a copy of the substitution to be mailed, prior to, or concurrently 5 1 with, the recording thereof, in the manner provided in Section 2924b, to the trustee then of record and to all persons to whom a copy of the notice of default would be required to be mailed by the provisions of Section 2924b. 2 3 Defendants effected the substitution after the notice of default but prior to the recording of the 4 notice of sale. Plaintiff thus fails to establish the violation of Section 2934 as a basis for the 5 validity of her quiet title claim. 6 B. California Civil Code Section 2932.5. 7 Plaintiff next argues that defendants violated Section 2932.5 during the foreclosure 8 process. She alleges that the deed of trust “was not properly assigned, acknowledged and 9 recorded because Defendant NDEX acted on behalf of beneficiary W[achovia] prior to their 10 proper authority to do so. Furthermore, plaintiff’s loan is secured by a deed of trust, not a For the Northern District of California United States District Court having the proper authority to act” (Opp. 5). As discussed above, NDEX did not act without 11 12 mortgage, which is not covered by this statute. See Calvo v. HSBC Bank USA, N.A., 13 No. B226494, 2011 WL 4035791, at *2–3 (Cal. Ct. App. Sept. 13, 2011). Accordingly, plaintiff 14 fails to establish Section 2932.5 as the basis for the validity of her quiet title claim. 15 Plaintiff has thus failed to carry her burden in demonstrating not only that her claim to 16 quiet title is a real property claim, but that she will more likely than not be awarded a judgment 17 for quiet title against defendants. Accordingly, defendants’ motion to expunge the 2011 lis 18 pendens is GRANTED. 19 Because this order finds that plaintiff has failed to carry her burden in demonstrating the 20 probable validity of her claim to quiet title, this order does not reach defendants’ other theories 21 of judicial estoppel and tender. Nor does it address defendants’ request that plaintiff be required 22 to post an undertaking in the event the lis pendens are not expunged. 23 4. ATTORNEY’S FEES. 24 Pursuant to California Code of Civil Procedure Section 405.38, defendants request an 25 award of $2,200.00 in attorney’s fees for bringing the instant motion. Section 405.38 is 26 discretionary and states that fees can be denied when “circumstances make the imposition of 27 attorney’s fees and costs unjust.” Defendants argue that they should be awarded their fees 28 6 1 because they made multiple requests to plaintiff that she withdraw the lis pendens “since the 2 Property was sold at a foreclosure sale and there are no real property claims remaining” (Br. 10). 3 The circumstances here would render an award of attorney’s fees to defendants unjust. 4 See Cruz v. Wachovia Mortg., 775 F. Supp. 2d 1188, 1191 (C.D. Cal. 2011) (Matz, J.). 5 Accordingly, defendants’ request for attorney’s fees is DENIED. 6 CONCLUSION 7 For the foregoing reasons, the motion to expunge the notices of pending action is 8 GRANTED, and defendants’ request for attorney’s fees is DENIED. 9 IT IS SO ORDERED. 11 For the Northern District of California United States District Court 10 12 13 Dated: October 4, 2011. WILLIAM ALSUP UNITED STATES DISTRICT JUDGE 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7
]]>
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You
should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
