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SUPERIOR COURT OF CALIFORNIA
COUNTY OF SANTA CLARA
MINUTE ORDER
llias Taptelis vs Quality Loan Service Corporation et al Hearing Start Time: 9:00 AM
20CV372905 Hearing Type: Motion: Order
Date of Hearing: 07/21/2022 Comments: 9
Heard By: Takaichi, Drew C Location: Department 2
Courtroom Reporter: - No Court Reporter Courtroom Clerk: Farris Bryant
Court Interpreter:
Court Investigator:
Parties Present: Future Hearings:
Exhibits:
- to Expunge the Second Lis Pendens by Defs Homeward Opportunities Fund | Trust 2019-2, U.S. Bank
National Association (Michael W. Stoltzman, Jr.)
The following attorney(s) appear via CourtCall:
Ronald H. Freshman For: Plaintiff(s), Illias Louie Taptelis
Michael W. Stoltzman, Jr. for Defendant(s), Homeward Opportunities Fund | Trust 2019-2
Parties were ordered to appear to today's hearing per Court order.
Matter is heard/argued.
The Tentative Ruling is adopted. See below for ruling.
Calendar line 9
Case Name: llias Taptelis vs Quality Loan Service Corporation et al
Case No.: 20CV372905
Background
On October 30, 2020, plaintiff Ilias Taptelis ( plaintiff ) filed complaint against defendants Quality Loan Service
Corporation, Specialized Loan Servicing, LLC, and Homeward Opportunities Fund | Trust 2019-2, U.S. Bank,
N.A. The complaint alleges nine causes of action for violation of homeowners bill of rights, violation of Civil
Code section 2923.55, violation of Civil Code section 2924.17, breach of good faith and fair dealing,
negligence, wrongful foreclosure, cancellation of instruments, violation of Business and Professions Code
section 17200, and quiet title. The action pertains to a loan secured by deed of trust ( DOT ) on the real
property at 181 Fennel Court, Morgan Hill, CA ( subject property ).
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MINUTE ORDER
On December 4, 2020, a trustee s sale pursuant to the DOT was completed and defendants acquired title to
the subject property by trustee deed upon sale.
On February 23, 2022, plaintiff recorded a second lis pendens.
On May 25, 2022, defendants Homeward Opportunities Fund | Trust 2019-2, U.S. Bank National Association,
as trustee and Specialized Loan Servicing ( defendants ) filed the instant motion to expunge second lis
pendens recorded by plaintiff.
On July 8, 2022, plaintiff filed opposition, and on July 14, 2022, defendants filed reply.
Requests for judicial notice
Defendant requests judicial notice of DOT (exhibit 1), assignment of DOT (exhibit 2), substitution of trustee
(exhibit 3), notice of default (exhibit 4), notice of trustee s sale (exhibit 5), trustee s deed upon sale (exhibit
6), judgment (exhibit 7), and lis pendens (exhibit 8).
Plaintiff requests judicial notice of application for extension of time to file brief (no. 1), amended notice of
appeal (no. 2) and minute order (no. 3).
Judicial notice is GRANTED of the existence and facial contents of recorded instruments including the fact of
the documents recordation, the parties to the transactions, the dates the parties executed and recorded the
documents, and legally operative language, but not disputed statements. Yvanova v. New Century Mortgage
Corp. (2016) 62 Cal.4th 919, 924, fn.1, citing Evid. Code 452, subds. (c), (h). This includes defendants exhibits
1 through 6 and 8.
Judicial notice of the judgment (defendant s exhibit 7) and minute order (plaintiff s no. 3) is granted.
Evidence Code section 452, subdivision (d)(1).
The request for judicial notice is GRANTED as to the existence of the application for extension (plaintiff s no.
1) and amended notice of appeal (plaintiff s no. 2). (See Day v. Sharp (1975) 50 Cal.App.3d 904, 914 (stating
that a court cannot take judicial notice of hearsay allegations as being true, just because they are part of a
court record or file [a] court may take judicial notice of the existence of each document in a court file, but
can only take judicial notice of the truth of facts asserted in documents such as orders, findings of fact and
conclusions of law, and judgments )
Analysis
As set forth in the papers filed in support, opposition and reply, expungement of a lis pendens is mandatory
upon a showing of either of the following grounds: (1) the complaint does not contain a real property claim
(Code of Civil Procedure section 405.31) or (2) the plaintiff cannot prove the probable validity of the real
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COUNTY OF SANTA CLARA
MINUTE ORDER
property claim by a preponderance of the evidence. (Code of Civil Procedure section 405.32).
The parties do not dispute that the party opposing the motion to expunge has the burden of proof to show a
real property claim and/or probable validity of the real property claim.
Does the complaint contain a real property claim ?
On December 11, 2020, a trustee s deed upon sale was recorded. After such a deed is recorded, a mortgage
servicer, mortgagee, trustee, beneficiary, or authorized agent is liable to a borrower for actual economic
damages from a material violation of provisions of Homeowners Bill of Rights ( HOBOR ) of the California Civil
Code. Under that circumstance, no other relief is available under the HOBOR that would affect title to, or the
right to possession of the subject property.
Defendants assert all causes of action in the complaint are based on violations of HOBOR, and because of the
recording of the trustee s deed upon sale, the causes of action are not real property claims .
Plaintiff essentially concedes by not rebutting in opposition defendants assertion that the first through fifth
causes of action of the complaint are based on violations of HOBOR, that because of the legal effect of
recording of the trustee deed upon sale, plaintiff cannot obtain relief affecting title to, or the right to
possession of the subject property, and therefore, the causes of action are not real property claims for the
purpose of the motion for expungement.
However, plaintiff argues that the four remaining causes of action of the complaint, for wrongful foreclosure
(sixth cause of action), cancellation of instruments (seventh cause of action), unfair business practices (eighth
cause of action), and quiet title (ninth cause of action) may be based upon HBOR violations, and provide for
remedies including recovery of title.
Hence, remedies pursuant to the causes of action are not limited to economic damages, and include recovery
of title or real property claims to warrant denial of the motion to expunge.
In support, plaintiff cites Civil Code section 2924.12, subdivision (g) which provides (g) The rights, remedies,
and procedures provided by this section are in addition to and independent of any other rights, remedies, or
procedures under any other law. Nothing in this section shall be construed to alter, limit, or negate any other
rights, remedies, or procedures provided by law.
In reply, defendants persuasively argue that applying Civil Code section 2924.12, subdivision (g) in the
manner proffered by plaintiff would render ineffective Civil Code section 2924.12, subdivision (b) which in
effect limits remedies to actual economic damages after a trustee s deed upon sale has been recorded for
violations of provisions of HOBOR. A party could simply allege a HOBOR violation in a common law cause of
action instead of a statutory violation of HOBOR, and bypass the provisions of Civil Code section 2924.12,
subdivision (b).
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COUNTY OF SANTA CLARA
MINUTE ORDER
Plaintiff does not cite authority that supports this interpretation and application of the statute, and the court
declines to adopt the interpretation under the circumstances without appropriate authority.
The court therefore finds that plaintiff has failed to meet the burden of proof to show that plaintiff s
complaint contains a real property claim pursuant to Code of Civil Procedure section 405.31.
Defendants motion to expunge the second lis pendens is therefore, GRANTED.
As a result of this ruling, it is unnecessary to determine the alternate ground for expungement pursuant to
Code of Civil Procedure section 405.32.
Attorneys fees and costs
Defendants request award of attorneys fees and costs as prevailing parties in bringing the motion to expunge
the second lis pendens and as prevailing parties in the motion to expunge the first lis pendens as to fees
incurred on substantive grounds which the court reserved.
The declarations of attorneys for defendants evidence the experience, hourly rates, hours incurred, and fees
charged. Plaintiff does not contest hourly rates, hours incurred, or corresponding fees of attorneys for
defendants.
Instead, plaintiff asserts that defendants should not be awarded their attorneys fees and costs because
plaintiff acted with substantial justification in recording the first and second lis pendens, and an award of
attorneys fees would be unjust.
Considering the weight of authority and facts that supported expungement, the justification for recording and
not withdrawing the second lis pendens does not rise to substantial justification. Defendants are the
prevailing parties in the motion to expunge and are entitled to recover attorneys fees pursuant to Code of
Civil Procedure section 405.38. Defendants shall recover, and plaintiff is ordered to pay to defendants
additional attorneys fees and costs of $7,000, payable on or before 90 days from date of hearing. An award
of additional fees in excess of $7,000 would be unjust under the circumstances.
Defendants shall prepare the order.
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SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER llias Taptelis vs Quality Loan Service Corporation et al Hearing Start Time: 9:00 AM 20CV372905 Hearing Type: Motion: Order Date of Hearing: 07/21/2022 Comments: 9 Heard By: Takaichi, Drew C Location: Department 2 Courtroom Reporter: - No Court Reporter Courtroom Clerk: Farris Bryant Court Interpreter: Court Investigator: Parties Present: Future Hearings: Exhibits: - to Expunge the Second Lis Pendens by Defs Homeward Opportunities Fund | Trust 2019-2, U.S. Bank National Association (Michael W. Stoltzman, Jr.) The following attorney(s) appear via CourtCall: Ronald H. Freshman For: Plaintiff(s), Illias Louie Taptelis Michael W. Stoltzman, Jr. for Defendant(s), Homeward Opportunities Fund | Trust 2019-2 Parties were ordered to appear to today's hearing per Court order. Matter is heard/argued. The Tentative Ruling is adopted. See below for ruling. Calendar line 9 Case Name: llias Taptelis vs Quality Loan Service Corporation et al Case No.: 20CV372905 Background On October 30, 2020, plaintiff Ilias Taptelis ( plaintiff ) filed complaint against defendants Quality Loan Service Corporation, Specialized Loan Servicing, LLC, and Homeward Opportunities Fund | Trust 2019-2, U.S. Bank, N.A. The complaint alleges nine causes of action for violation of homeowners bill of rights, violation of Civil Code section 2923.55, violation of Civil Code section 2924.17, breach of good faith and fair dealing, negligence, wrongful foreclosure, cancellation of instruments, violation of Business and Professions Code section 17200, and quiet title. The action pertains to a loan secured by deed of trust ( DOT ) on the real property at 181 Fennel Court, Morgan Hill, CA ( subject property ). Printed: 7/21/2022 07/21/2022 Motion: Order - 20CV372905 Page 1of 5SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER On December 4, 2020, a trustee s sale pursuant to the DOT was completed and defendants acquired title to the subject property by trustee deed upon sale. On February 23, 2022, plaintiff recorded a second lis pendens. On May 25, 2022, defendants Homeward Opportunities Fund | Trust 2019-2, U.S. Bank National Association, as trustee and Specialized Loan Servicing ( defendants ) filed the instant motion to expunge second lis pendens recorded by plaintiff. On July 8, 2022, plaintiff filed opposition, and on July 14, 2022, defendants filed reply. Requests for judicial notice Defendant requests judicial notice of DOT (exhibit 1), assignment of DOT (exhibit 2), substitution of trustee (exhibit 3), notice of default (exhibit 4), notice of trustee s sale (exhibit 5), trustee s deed upon sale (exhibit 6), judgment (exhibit 7), and lis pendens (exhibit 8). Plaintiff requests judicial notice of application for extension of time to file brief (no. 1), amended notice of appeal (no. 2) and minute order (no. 3). Judicial notice is GRANTED of the existence and facial contents of recorded instruments including the fact of the documents recordation, the parties to the transactions, the dates the parties executed and recorded the documents, and legally operative language, but not disputed statements. Yvanova v. New Century Mortgage Corp. (2016) 62 Cal.4th 919, 924, fn.1, citing Evid. Code 452, subds. (c), (h). This includes defendants exhibits 1 through 6 and 8. Judicial notice of the judgment (defendant s exhibit 7) and minute order (plaintiff s no. 3) is granted. Evidence Code section 452, subdivision (d)(1). The request for judicial notice is GRANTED as to the existence of the application for extension (plaintiff s no. 1) and amended notice of appeal (plaintiff s no. 2). (See Day v. Sharp (1975) 50 Cal.App.3d 904, 914 (stating that a court cannot take judicial notice of hearsay allegations as being true, just because they are part of a court record or file [a] court may take judicial notice of the existence of each document in a court file, but can only take judicial notice of the truth of facts asserted in documents such as orders, findings of fact and conclusions of law, and judgments ) Analysis As set forth in the papers filed in support, opposition and reply, expungement of a lis pendens is mandatory upon a showing of either of the following grounds: (1) the complaint does not contain a real property claim (Code of Civil Procedure section 405.31) or (2) the plaintiff cannot prove the probable validity of the real Printed: 7/21/2022 07/21/2022 Motion: Order - 20CV372905 Page 2 of 5SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER property claim by a preponderance of the evidence. (Code of Civil Procedure section 405.32). The parties do not dispute that the party opposing the motion to expunge has the burden of proof to show a real property claim and/or probable validity of the real property claim. Does the complaint contain a real property claim ? On December 11, 2020, a trustee s deed upon sale was recorded. After such a deed is recorded, a mortgage servicer, mortgagee, trustee, beneficiary, or authorized agent is liable to a borrower for actual economic damages from a material violation of provisions of Homeowners Bill of Rights ( HOBOR ) of the California Civil Code. Under that circumstance, no other relief is available under the HOBOR that would affect title to, or the right to possession of the subject property. Defendants assert all causes of action in the complaint are based on violations of HOBOR, and because of the recording of the trustee s deed upon sale, the causes of action are not real property claims . Plaintiff essentially concedes by not rebutting in opposition defendants assertion that the first through fifth causes of action of the complaint are based on violations of HOBOR, that because of the legal effect of recording of the trustee deed upon sale, plaintiff cannot obtain relief affecting title to, or the right to possession of the subject property, and therefore, the causes of action are not real property claims for the purpose of the motion for expungement. However, plaintiff argues that the four remaining causes of action of the complaint, for wrongful foreclosure (sixth cause of action), cancellation of instruments (seventh cause of action), unfair business practices (eighth cause of action), and quiet title (ninth cause of action) may be based upon HBOR violations, and provide for remedies including recovery of title. Hence, remedies pursuant to the causes of action are not limited to economic damages, and include recovery of title or real property claims to warrant denial of the motion to expunge. In support, plaintiff cites Civil Code section 2924.12, subdivision (g) which provides (g) The rights, remedies, and procedures provided by this section are in addition to and independent of any other rights, remedies, or procedures under any other law. Nothing in this section shall be construed to alter, limit, or negate any other rights, remedies, or procedures provided by law. In reply, defendants persuasively argue that applying Civil Code section 2924.12, subdivision (g) in the manner proffered by plaintiff would render ineffective Civil Code section 2924.12, subdivision (b) which in effect limits remedies to actual economic damages after a trustee s deed upon sale has been recorded for violations of provisions of HOBOR. A party could simply allege a HOBOR violation in a common law cause of action instead of a statutory violation of HOBOR, and bypass the provisions of Civil Code section 2924.12, subdivision (b). Printed: 7/21/2022 07/21/2022 Motion: Order - 20CV372905 Page 3 of 5SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER Plaintiff does not cite authority that supports this interpretation and application of the statute, and the court declines to adopt the interpretation under the circumstances without appropriate authority. The court therefore finds that plaintiff has failed to meet the burden of proof to show that plaintiff s complaint contains a real property claim pursuant to Code of Civil Procedure section 405.31. Defendants motion to expunge the second lis pendens is therefore, GRANTED. As a result of this ruling, it is unnecessary to determine the alternate ground for expungement pursuant to Code of Civil Procedure section 405.32. Attorneys fees and costs Defendants request award of attorneys fees and costs as prevailing parties in bringing the motion to expunge the second lis pendens and as prevailing parties in the motion to expunge the first lis pendens as to fees incurred on substantive grounds which the court reserved. The declarations of attorneys for defendants evidence the experience, hourly rates, hours incurred, and fees charged. Plaintiff does not contest hourly rates, hours incurred, or corresponding fees of attorneys for defendants. Instead, plaintiff asserts that defendants should not be awarded their attorneys fees and costs because plaintiff acted with substantial justification in recording the first and second lis pendens, and an award of attorneys fees would be unjust. Considering the weight of authority and facts that supported expungement, the justification for recording and not withdrawing the second lis pendens does not rise to substantial justification. Defendants are the prevailing parties in the motion to expunge and are entitled to recover attorneys fees pursuant to Code of Civil Procedure section 405.38. Defendants shall recover, and plaintiff is ordered to pay to defendants additional attorneys fees and costs of $7,000, payable on or before 90 days from date of hearing. An award of additional fees in excess of $7,000 would be unjust under the circumstances. Defendants shall prepare the order. Printed: 7/21/2022 07/21/2022 Motion: Order - 20CV372905 Page 4 of 5SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER Printed: 7/21/2022 07/21/2022 Motion: Order - 20CV372905 Page 5 of 5