Tag Archives: stay foreclosure

Kansas Court of Appeals Finds Note Splitting Argument Lacked Merit

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The court in deciding Wells Fargo Bank, N.A. v. Richards, 2013 Kan. App. 1160 (Kan. Ct. App. 2013) ultimately upheld the lower court’s decision.

The plaintiff [Chester E. Richards, Jr.], appealed the lower court’s decision which granted summary judgment to Wells Fargo.

Plaintiff had asserted (1) Wells Fargo lacked standing to bring the foreclosure action; (2) the lower court erred in holding Wells Fargo’s possession of the promissory note he signed was insufficient to enforce and foreclose the mortgage it secures; (3) Wells Fargo did not experience/suffer a default; (4) there was no contract because the note and mortgage were split; and (5) Richards was not afforded due process.

The court examined the record and considered the arguments of both the parties and held that there was no merit to any of the plaintiffs’ arguments. Consequently, the court affirmed the decision from the lower court.

 

California Court Upholds Summary Judgment Against Plaintiff, Dismissing California Uniform Commercial Code section 9313 Violations

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The court in deciding Wolford v. Am. Home Mortg. Servicing, 2013 Cal. App. Unpub. LEXIS 7307 (Cal. App. 2d Dist. 2013) ultimately granted summary judgment in favor of defendants. AHMSI and Wells Fargo met their threshold burden to show they satisfied the requirements necessary for non-judicial foreclosure, and appellant failed to raise a triable issue of material fact.

The plaintiff’s complaint alleged causes of action for declaratory relief; injunctive relief; determination of lien pursuant to California Uniform Commercial Code section 9313; breach of contract and the implied covenant of good faith and fair dealing; violation of the Truth in Lending Act (15 U.S.C. § 1601 et seq.); violation of the Real Estate Settlement and Procedures Act (12 U.S.C. § 2601 et seq.); rescission; unconscionability; and quiet title.

The lower court dismissed the plaintiff’s initial claims as summary judgment was granted in favor of the defendants. Appellant contended the denial of summary judgment in the related unlawful detainer action and evidence of irregularities in the foreclosure process demonstrated triable issues of material fact warranting the denial of summary judgment. However, this court in upholding the lower court’s decision, found that there was no merit to the plaintiff’s contentions.

 

Nevada Court Dismisses TILA and Fraud Claims Brought Against Chase and MERS

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The court in deciding Leong v. JPMorgan Chase, 2013 U.S. Dist. LEXIS 144678 (D. Nev. 2013) ultimately granted the defendant’s motion to dismiss.

This action arose out of the foreclosure proceedings initiated against the property of the plaintiff Teresa Leong. Defendants Chase and MERS filed a motion to dismiss plaintiff’s action. Plaintiff alleged two causes of action, one of which was fraud: “wrongful use of a non existent co-borrower” and the other was “fraudulent documentation.” Plaintiff also requested, “to see her original documents, note and deed.”

After considering the plaintiff’s contentions, the court found that the plaintiff failed to allege that she was current on her mortgage payments or had otherwise satisfied the conditions and terms under the deed of trust. Accordingly, the court found that plaintiff failed to state a legally cognizable claim for wrongful foreclosure, and the action must be dismissed.

Plaintiff also insisted that defendant failed to provide the original note, plaintiff cited Nev. Rev. Stat. § 107.086(4). However, the court found that the defendants correctly point out that the plaintiff failed to cite to any authority that required defendants to produce the original note. As such, this cause of action was dismissed with prejudice.

Plaintiff lastly alleged that defendant failed to comply with the Federal Truth in Lending Act (“TILA”), codified at 15 U.S.C. § 1601 et seq. TILA contained many provisions concerning accurate and meaningful credit disclosures. However, the court found that the plaintiff’s complaint did not specify any particular provision with which defendant failed to comply. Accordingly, plaintiff provided only a conclusory statement as support for a vague TILA claim, and to the extent that this cause of action is alleged, it must be dismissed.

 

Nevada Court Dismisses Show-me-the-Note Action Brought Against Chase and MERS

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The court in Leong v. JPMorgan Chase, 2013 U.S. Dist. LEXIS 144678 (D. Nev. Oct. 7, 2013) granted defendants’ motion to dismiss.

This action arose out of the foreclosure proceedings initiated against the property of pro se Plaintiff Teresa Leong. Pending before the court was a motion to dismiss filed by defendants JPMorgan Chase Bank, N.A. (“Chase”) and Mortgage Electronic Registration Systems, Inc. (“MERS”) (collectively, “Defendants”). Plaintiff continued to request “to see my original documents Note and Deed.”

Plaintiff insisted that defendant failed to provide the original note. The court found that the only possibly relevant Nevada statute requiring the presentation of the original note or a certified copy is at a Foreclosure Mediation. Nev. Rev. Stat. § 107.086(4). Moreover, the court noted that it treats copies in the same way as it treats originals: “a duplicate is admissible to the same extent as an original.” Nev. Rev. Stat. § 52.245.

The court noted that the defendants correctly point out that plaintiff failed to cite to any authority that requires defendants to produce the original note, and defendants additionally provided non-binding legal authority to the contrary. As such, the court dismissed this cause of action with prejudice.

California Court Dismisses Action Brought Against MERS and Aurora Loan Services for Wrongfully Initiated Foreclosure Proceedings

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The court in Morgan v. Aurora Loan Servs., LLC, 2013 U.S. Dist. LEXIS 145623 (C.D. Cal. 2013) granted defendants’ motion to dismiss plaintiff’s claims. The court concluded that the “allegation of other facts consistent with the challenged pleading could not possibly cure the deficiencies” of either the first or third through tenth claims, thus the court dismissed these claims with prejudice.

Plaintiff Cherie J. Morgan filed this action against Aurora Loan Services, LLC (“Aurora”), Mortgage Electronic Registration Systems, Inc. (“MERS”), and Does 1-100, inclusive (collectively, “defendants”).

Plaintiff principally complained that defendants wrongfully initiated foreclosure proceedings against her property and that a subsequent trustee’s sale was invalid because defendants lacked any interest in the property. Plaintiff’s claim asserted the following claims for relief: (1) lack of standing; (2) breach of written contract; (3) intentional misrepresentation; (4) negligent misrepresentation; (5) cancellation of instruments; (6) quiet title; (7) promissory estoppel; (8) breach of implied covenant of good faith and fair dealing; (9) premature and unlawful filing of notice of default; and (10) unfair business practices under Cal. Bus. & Prof. Code §§ 17200 et seq. (“UCL”).

Defendants moved to dismiss plaintiff’s SAC. Plaintiff opposed the motion, but after considering the parties’ arguments, the court granted defendant’s motion to dismiss.

 

 

Washington Court Rejects Split-the-Note Theory

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The court in Zhong v. Quality Loan Serv. Corp., 2013 U.S. Dist. LEXIS 145916 (W.D. Wash. 2013) granted defendant’s motion to dismiss.

In her complaint, plaintiff alleged ten causes of action in connection with the initiation of the non-judicial foreclosure of her property.

Specifically, she brought claims for (1) wrongful foreclosure under the Washington Deed of Trust Act (“DTA”), RCW 61.24, (2) violation of Washington’s Consumer Protection Act (“CPA”), (3) negligence and breach of the duty of good faith and fair dealing, (4) a request for injunctive relief, (5) a request for declaratory judgment, (6) cloud of title, (7) quiet title, (8) predatory lending, (9) emotional distress, and (10) unjust enrichment. Defendants removed the case to federal court, and now move to dismiss the complaint under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim.

The defendants filed a motion to dismiss, this motion was granted. The court found that the plaintiff’s arguments failed as the court found that the plaintiff simply rehashed well-worn arguments that courts have repeatedly rejected.

 

Nevada Court Found Plaintiff’s Claim for Quiet Title Failed as a Matter of Law Based on Statute’s Express Language

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The court in dealing with Beverly v. Weaver-Farley, 2013 U.S. Dist. LEXIS 146150 (D. Nev. 2013) ultimately dismissed the plaintiff’s claims. In her complaint, plaintiff alleged that pursuant to NRS 116.3116(2)(b), Wells Fargo’s first deed of trust was extinguished by the HOA’s foreclosure and sale of the underlying property.

The court found that, the first deed of trust was recorded in October 2004; also defendant Wells Fargo was assigned all rights under the first deed of trust in April 2009, a full month before the delinquent HOA assessment was recorded on the subject property. Thus, Wells Fargo’s lien meets the statutory requirements of NRS 116.3116(2)(b) as such survived the HOA sale. Therefore, the plaintiff took title to the property subject to the first deed of trust.

As an alternative argument, plaintiff contended that Section 3116(2)(c) carved out a limited exception to Section 3116(2)(b) that is applicable in this matter.

Plaintiff further contended that this section provided that the foreclosure of a delinquent HOA assessment lien extinguished the first security interest on the property if it related to charges incurred during the nine months prior to the foreclosure.

However, once again the court found that the plaintiff misconstrued the statute. The court found that the plain language of NRS 116.3116(2)(c) simply created a limited super priority lien for nine months of HOA assessments leading up to the foreclosure of the first mortgage, but it did not eliminate the first security interest. Based on the express language of the statutes, the court found that the plaintiff’s claim for quiet title failed as a matter of law. Accordingly, the court granted Wells Fargo’s motion to dismiss.