What is wrongful foreclosure?

“A wrongful foreclosure is a common law tort claim. It is an equitable action to set aside a foreclosure sale, or an action for damages resulting from the sale, on the basis that the foreclosure was improper.” (Sciarratta v. U.S. Bank Nat’l Assn. (2016) 247 Cal.App.4th 552, 561.)

Legal Standard

“The basic elements of a tort cause of action for wrongful foreclosure track the elements of an equitable cause of action to set aside a foreclosure sale.” (Miles v. Deutsche Bank Nat’l Trust Co. (2015) 236 Cal.App.4th 394, 408.) “To maintain a wrongful foreclosure claim, a plaintiff must allege that

  1. the defendants caused an illegal, fraudulent, or willfully oppressive sale of the property pursuant to a power of sale in a mortgage or deed of trust;
  2. the plaintiff suffered prejudice or harm; and
  3. the plaintiff tendered the amount of the secured indebtedness or was excused from tendering.”

(Chavez v. Indymac Mortgage Services (2013) 219 Cal.App.4th 1052, 1062; Lona v. Citibank, N.A. (2011) 202 Cal.App.4th 89, 104.)

“[M]ere technical violations of the foreclosure process will not give rise to a tort claim; the foreclosure must have been entirely unauthorized on the facts of the case.” (Miles, supra, 236 Cal.App.4th at p. 409.)

Wrongful foreclosure claims are premature if there has been no foreclosure sale. (Vega v. JPMorgan Chase Bank, N.A. (E.D.Cal. 2009) 654 F. Supp.2d 1104, 1113.) In situations where a foreclosure has already occurred, the California Supreme Court held that a borrower has standing to sue for wrongful foreclosure based on an allegedly void assignment of his or her mortgage. (Yvanova v. New Century Mortg. Corp. (2016) 62 Cal.4th 919.)

However, in cases where a foreclosure sale has not taken place, the court deliberately left open the question of whether a borrower may preemptively challenge a foreclosing party’s right to proceed with the foreclosure. (Yvanova, supra, 62 Cal.4th at p. 924.) The court thus left intact an appellate court decision in Gomes v. Countrywide Home Loans, Inc. (2011) 192 Cal.App.4th 1149 (Gomes), which held that courts may not interject themselves into California’s comprehensive nonjudicial foreclosure scheme by entertaining “speculative suit[s]” regarding the lack of authority by the foreclosing entity to foreclose. (Gomes, supra, 192 Cal.App.4th at p. 1156.)

Statute of Limitations

Generally, the statute of limitations for wrongful foreclosure is three years. (Code of Civ. Proc., Code § 338(a), (d).)

Useful Rulings on Wrongful Foreclosure

Recent Rulings on Wrongful Foreclosure

AGUINA VS CRAWFORD

A borrower must allege a credible tender or excuse from tender to maintain a quiet title or wrongful foreclosure action. (Miller v. Provost (1994) 26 Cal.App.4th 1703, 1707.) One excuse from the tender requirement is where the borrower attacks the validity of the underlying debt. (Lona v. Citibank, N.A. (2011) 202 Cal.App.4th 89, 112–113.) Here, Plaintiff attacks the underlying debt's validity because he complains of the excessive payment demand to escrow. (4AC, ¶ 50.)

  • Hearing

(NO CASE NAME AVAILABLE)

At the October 15, 2020 hearing, Plaintiff argued that the law categorically prohibits consideration of the validity of a plaintiff’s title in an unlawful detainer action, regardless of the merits of Defendant’s wrongful foreclosure case. The Court then raised the question of whether this action should be stayed pending the wrongful foreclosure action, and gave the parties an opportunity to brief the issue.

  • Hearing

JAMES STARTZ VS SPECIALIZED LOAN SERVICING, LLC, ET AL.

On October 30, 2019, plaintiff filed a verified complaint for Wrongful Foreclosure, Violation of Civil Code section 2923.6, Breach of Covenant of Good Faith and Fair Dealing, and Violation of Business and Professions Code section 17200. RULING: Granted. Request for Judicial Notice: Granted. Defendant Bank of New York Mellon brings a motion to expunge the lis pendens on the grounds that Plaintiff lacks a valid underlying real property claim.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Foreclosure

WAYNE H. PLATT INDIVIDUALLY AND AS CO-TRUSTEES OF THE PLATT FAMILY TRUST DATED NOVEMBER 7, 2000,, ET AL. VS OAKHURST INCOME FUND I, LP, A DELAWARE LIMITED PARTNERSHIP, ET AL.

BACKGROUND This action arises from an alleged wrongful foreclosure sale.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Foreclosure

CITRUS EL DORADO LLC VS STEARNS BANK

Hence, the request to summarily adjudicate the issues raised regarding the wrongful foreclosure cause of action is denied and to treat this as a motion for summary judgment and a motion for summary adjudication to the punitive damage request. The required elements of a wrongful foreclosure cause of action are: (1) the trustee caused an illegal, fraudulent, or willfully oppressive sale of real proper under the power of sale in a deed of trust; (2) the plaintiff was prejudiced or harmed; and, (3) tender.

  • Hearing

ANTHONY THOMAS VS LAKEWOOD VILLAGE TOWNHOMES H.O.A, ET AL.

Wrongful Foreclosure 2. Negligence 3. Breach of Fiduciary Duty 4. Breach of Contract 5. Breach of Implied Covenant of Good Faith and Fair Dealing 6. IIED Plaintiff submits his affidavit, attesting to various notice deficiencies with the foreclosure process. (Thomas Decl., ¶¶ 8-14.) Defendants did not submit any evidence in opposition. Accordingly, Plaintiff has demonstrated likely success on the merits. Because real property is unique, Plaintiff has demonstrated irreparable harm.

  • Hearing

  • Type

    Real Property

  • Sub Type

    other

  • Judge

    Lori Ann Fournier or Olivia Rosales

  • County

    Los Angeles County, CA

HARRIETT E. HAYWOOD VS RTED AMERICA, LLC, ET AL

In that motion she argued the same or similar—that she was denied her right to conduct discovery and due process because her complaint was dismissed at the pleading stage and that she should have been allowed to amend her complaint to assert a cause of action for wrongful foreclosure based on the claim that the assignments of the deed of trust were void.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Foreclosure

HARRIETT E. HAYWOOD VS RTED AMERICA, LLC, ET AL

In that motion she argued the same or similar—that she was denied her right to conduct discovery and due process because her complaint was dismissed at the pleading stage and that she should have been allowed to amend her complaint to assert a cause of action for wrongful foreclosure based on the claim that the assignments of the deed of trust were void.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Foreclosure

THRESSA D. YOUNG VS BLUE SKY CAPITAL REALTY INC., ET AL.

.: 20CMCV00158 Matter on calendar for: demurrer to First Amended Complaint Tentative ruling: Facts In this wrongful foreclosure action, plaintiff Thressa Young (“Young”) alleges defendants Blue Sky Capital Realty, Inc., dba Elite Loan Servicing, Metro Capital Fund, LLC (“MCF”), and S.B.S. Trust Deed Network (“S.B.S”) violated multiple provisions of the Homeowners Bill of Rights (“HBOR”).

  • Hearing

  • Type

    Real Property

  • Sub Type

    other

  • Judge

    Maurice A. Leiter or Salvatore Sirna

  • County

    Los Angeles County, CA

TOWER PARK PROPERTIES, LLC, A DELAWARE LIMITED LIABILITY COMPANY, ET AL. VS HUGHES INVESTMENT PARTNERSHIP, LLC, A DELAWARE LIMITED LIABILITY COMPANY, ET AL.

Plaintiffs also argue that they will file a motion for leave to file a second amended complaint, converting the amended complaint to enjoin foreclosure into a second amended complaint for wrongful foreclosure. Plaintiffs make no specific arguments as to how they can amend their breach of contract claims to survive demurrer. Moreover, Plaintiffs cannot move to amend the complaint to add new causes of action in their opposition to the demurrer.

  • Hearing

KEITH M FROMM VS WELLS FARGO BANK N A ET AL

Fromm alleges that he suffered damages as a result of his reliance on Wells Fargo’s misrepresentations, which include damage to his credit, deprivation of a good faith determination on his Lease Modification Application and the related appeal, costs and fees of preventing the wrongful foreclosure, and severe emotional distress. (Compl., ¶¶ 188-189.) Fromm also alleges that his fraud claims are not barred by the economic loss rule.

  • Hearing

  • Type

    Personal Injury/ Tort

  • Sub Type

    Fraud

MANUEL BOROBIA VS COUNTRYWIDE HOME LOANS, INC., (A "LENDER"), ET AL.

Although Defendant was not directly named in the underlying District Court action, both decisions involved the “wrongful foreclosure” claims, which directly implicates Bank of New York as both the trustee and purchaser of the property at the foreclosure sale.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Foreclosure

MANUEL BOROBIA VS COUNTRYWIDE HOME LOANS, INC., (A "LENDER"), ET AL.

foreclosure process and trustee sale of real estate property, and intentional infliction of emotional distress.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Foreclosure

PRUNEDA V. SELECT PORTFOLIO SERVICING, INC.

Fourth Cause of Action: Wrongful Foreclosure “The basic elements of a tort cause of action for wrongful foreclosure track the elements of an equitable cause of action to set aside a foreclosure sale.

  • Hearing

  • Type

    Personal Injury/ Tort

  • Sub Type

    other

TRINA ALLEN VS MATTHEW SHEPHERD, ET AL.

First Cause of Action – Wrongful Foreclosure “The elements of a wrongful foreclosure cause of action are: “ ‘(1) [T]he trustee or mortgagee caused an illegal, fraudulent, or willfully oppressive sale of real property pursuant to a power of sale in a mortgage or deed of trust; (2) the party attacking the sale (usually but not always the trustor or mortgagor) was prejudiced or harmed; and (3) in cases where the trustor or mortgagor challenges the sale, the trustor or mortgagor tendered the amount of the secured

  • Hearing

  • Type

    Personal Injury/ Tort

  • Sub Type

    Fraud

MANZANO V. WELLS FARGO BANK

The demurrers to the 1st cause of action for fraud, 2nd cause of action for constructive fraud, 4th cause of action for negligent misrepresentation, 5th cause of action for promissory estoppel, 6th cause of action for wrongful foreclosure, 9th cause of action for violation of Business and Professions Code, § 17200, and 10th cause of action for breach of fiduciary duty are sustained.

  • Hearing

ESPERANZA D BAGWELL VS JP MORGAN CHASE BANK, N.A., ET AL.

Plaintiff also alleges that at the time defendants made the promises described in the settlement agreement, they had no intention of performing, but made those promises to induce plaintiff to terminate her prior lawsuit against them for wrongful foreclosure. The file shows that on August 16, 2019, the court sustained a demurrer by defendant Deutsche Bank to the FAC without leave to amend.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Quiet Title

HA, ET AL. V. PHAM, ET AL.

Aflalo (2018) 23 Cal.App.5th 1109, 1112 (taking judicial notice of recorded documents related to the deed of trust and foreclosure sale, pleadings related to wrongful foreclosure suit, and moving papers related to motion to dismiss appeal); see also Intengan v.

  • Hearing

PATRICIA COLEMAN VS CALIBER HOME LOANS, INC.., A TEXAS CORPORATION, ET AL.

The Court found that, pursuant to the doctrine of judicial estoppel, Coleman’s wrongful foreclosure claim was property of her bankruptcy estate, and because it was not included in her bankruptcy schedules, Coleman was barred from proceeding with her wrongful foreclosure claim.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Foreclosure

NICOLE MAYS VS MORTGAGE MANAGEMENT CONSULTANTS, INC., ET AL.

On October 28, 2020, Plaintiff filed the second amended complaint for wrongful foreclosure, fraudulent misrepresentation, negligent misrepresentation, negligence (fourth cause of action), unfair business practices, promissory estoppel, cancellation of instruments, conversion, negligence (ninth cause of action), negligence (tenth cause of action), professional negligence (eleventh cause of action), and breach of fiduciary duty.

  • Hearing

  • Type

    Real Property

  • Sub Type

    other

NICOLE MAYS VS MORTGAGE MANAGEMENT CONSULTANTS, INC., ET AL.

On October 28, 2020, Plaintiff filed the second amended complaint for wrongful foreclosure, fraudulent misrepresentation, negligent misrepresentation, negligence (fourth cause of action), unfair business practices, promissory estoppel, cancellation of instruments, conversion, negligence (ninth cause of action), negligence (tenth cause of action), professional negligence (eleventh cause of action), and breach of fiduciary duty. RULING: Moot.

  • Hearing

  • Type

    Real Property

  • Sub Type

    other

TERESITA V. LAPID V. WESTERN PROGRESSIVE, LLC, ET AL.

The alleged wrongful foreclosure took place in 2011. The alleged improper transactions occurred between 2009 and 2011. The instant complaint was filed in 2020. The statute of limitations for all of Plaintiff’s claims – fraud, wrongful foreclosure, and statutory violations – is three years. (Code Civ. Proc., § 338, subds. (a), (d).) Plaintiff cannot take advantage of the delayed discovery rule as Plaintiff either knew or had reason to know all necessary facts to allege her present causes of action in 2011.

  • Hearing

FELICIA C BROWN VS SELECT PORTFOLIO SERVICING, INC., ET AL.

Accordingly, demurrer is SUSTAINED. 3rd CAUSE OF ACTION WRONGFUL FORECLOSURE: Plaintiffs contend that the foreclosure sale was wrongful because it took place while Plaintiff’s bankruptcy was pending. However, the bankruptcy did not give rise to an automatic stay.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Quiet Title

  • Judge

    Lori Ann Fournier or Olivia Rosales

  • County

    Los Angeles County, CA

ESTEBAN MONTENEGRO VS FEDERAL NATIONAL MORTGAGE ASSOCIATION

MOTION TO SET ASIDE ORDER DEEMING REQUESTS FOR ADMISSIONS ADMITTED Moving Party: Plaintiff, Cross-Complainant and Cross-Defendant Mireya Montenegro aka Mireya Canete Responding Party: Defendant Bank of America, NA RELIEF REQUESTED: Order setting aside order deeming requests for admissions admitted FACTUAL AND PROCEDURAL BACKGROUND: This is a wrongful foreclosure action originally brought by plaintiff Esteban Montenegro.

  • Hearing

  • Type

    Real Property

  • Sub Type

    Foreclosure

EDGAR A MEINHARDT VS SUNNY ACRE LLC, ET AL.

Plaintiff also seeks to add ten causes of action for: (1) violation of Civil Code section 2923.5; (2) wrongful foreclosure; (3) set aside a foreclosure sale; (4) violation of Civil Code section 2924.12; (5) violation of the Real Estate Settlement Procedures Act (RESPA); (6) rescission and damages under the Truth in Lending Act (TILA); (7) violation of the Home Ownership and Equity Protection Act (HOEPA); (8) fraud and deceit; (9) negligent misrepresentation; and (10) cancellation of instruments.

  • Hearing

  • Type

    Real Property

  • Sub Type

    other

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