“After a nonjudicial foreclosure sale has been completed, the traditional method by which the sale is challenged is a suit in equity to set aside the trustee’s sale.” (Lona v. Citibank (2011) 202 Cal. App. 4th 89, 103.)

The elements of a cause of action to set aside the trustee’s sale:

1. the trustee caused an illegal, fraudulent, or willfully oppressive sale of real property pursuant to a power of sale;
2. the party attacking the sale was prejudiced or harmed; and
3. the trustor tendered the amount of the secured indebtedness or was excused from tendering.

(Id at 104.)

The trustee’s failure to comply with statutory requirements for the notice or conduct of the sale may provide justification for setting it aside. (Id at 105.)

Verified Complaint Requirement

Under Code of Civil Procedure Section 761.020, a complaint that seeks to establish title against adverse claims to real property must be verified.

Overcoming Statutory Presumption

The plaintiff in an action must overcome the statutory presumption of Civil Code Section 2924(c) that the foreclosure sale was conducted properly. (Moeller v. Lien (1994) 25 Cal.App.4th 822, 831; see also, Nguyen v. Calhoun (2003) 105 Cal.App.4th 428, 441 citing in relevant part: “If the trustee’s deed recites that all statutory notice requirements and procedures required by law for the conduct of the foreclosure have been satisfied, a rebuttable presumption arises that the sale has been conducted regularly and properly; this presumption is conclusive as to a bona fide purchaser.”)

Cases on Point

“[A] trustor cannot set aside a foreclosure sale to a bona fide purchaser for value based on irregularities in the foreclosure process, except in the case of fraud.” (Melendez v. D & I Investment, Inc. (2005) 127 Cal. App. 4th 1238, 1256.)

“A trustor has no right to set aside a trustee’s deed as against a bona fide purchaser for value by attacking the validity of the sale.” (Moeller v. Lien (1994) 25 Cal. App. 4th 822, 832.)

“In limited circumstances, a foreclosure sale can be successfully challenged only if the buyer is not a bona fide purchaser.” (6 Angels, Inc. v. Stuart- Wright Mortgage, Inc. (2001) 85 Cal. App. 1279, 1286.)

The elements of bona fide purchaser:

1. payment of value,
2. in good faith, and
3. without actual or constructive notice of another's rights.

(Melendrez v. D & I Investment, Inc. (2005) 127 Cal. App. 4th 1238, 1251.)

“It is not necessary for the buyer to pay fair market value as long as valuable consideration is paid.” (Id.)

“A recital in the deed executed pursuant to the power of sale of compliance with all requirements of law regarding the mailing, service or posting of copies of the notice of default and notice of sale constitutes prima facie evidence of compliance with these requirement and conclusive evidence thereof in favor of bona fide purchases for value without notice.” (Cal. Civ. Code §2924(c).)