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I G. Andrew Slater, #238126 E-FILED
DO\ilLING AARON INCORPORATED 5/15/2019 11:20 AM
2 8080 North Palm Avenue
Superior Court of California
Third Floor
J Fresno, California lI County of Fresno
937
Tel: 559.432.4500 / Fax: 559.432.4590 By: A. Rodriguez, Deputy
4 aslater@dowlingaaron.com
5 Attorneys for Defendant
CITY NATIONAL BANK
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8 SUPEzuOR COURT OF THE STATE OF CALIFORNIA
9 COUNTY OF FRESNO
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1l SURJIT BAGGA, Case No. 16CECG03336
T2 Plaintifï, DEFENDANT'S MOTION FOR
SUMMARY JUDGMENT OR,IN THE
l3 V. ALTERATIVE, SUMMARY
ADJUDICATION
I4 CITY NATIONAL BANK, FRESNO
MANAGEMENT COMPANY, a California Date: November 13,2019
15 Corporation; Ray Hutchins, an individual,; Time: 3:30 p.m.
James Krause, an individual; and DOES 1-100, Dept: 501
t6 inclusive, Judge: Hon. Jeffrey Y. Hamilton
t7 Defendants
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DOWLINGIAARON
MOTION FOR SUMMARY ruDGMENT OR, IN THE ALTERATIVE, SUMMARY ADruDICATION
1 TABLE OF CONTENTS
2 Page
I. SUMMARY 1
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il. FACTUAL BACKGROLIND 1
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ilI. LAW AND ARGUMENT 6
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IV. ARGUMENT... 6
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A. CNB Is Entitled To Summary Judgment On The First Cause of
7 Action Alleged In The Complaint, For Wrongful Foreclosure................... 6
I B. CNB Is Entitled To Summary Judgment On The Second Cause of
Action Alleged In The Complaint, For Negligence. ... 8
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C. CNB Is Entitled To Summary Judgment On The Fourth and Fifth
10 Causes of Action Alleged In The Complaint, For Negligent
Misrepresentation and Fraud. 9
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D CNB Is Entitled To Summary Judgment As To The Seventh Cause
12 of Action Alleged In The Complaint, For Violation Of Business
And Professions Code Section 17200 et seq........ 10
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E. CNB Is Entitled To Summary Judgment As To The Eighth Cause
t4 of Action Alleged In The Complaint, For Conspiracy........... 11
15 F. CNB Is Entitled To Summary Judgment As To The Ninth Cause of
Action Alleged In The Complaint, For Breach Of Contract 11
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v. coNCLUSrON.................. t2
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ÞOWLINGIAARON
MOTION FOR SUMMARY ruDGMENT OR, IN THE ALTBRATIVE, SUMMARY ADruDICATION
1 TABLE OF AUTHORITIES
2 Pase
a
J Cases
4 Aguilar v. Atlantic Richfield Co,
(2001) 25 Cal.4th826 ........... 6
5 Arnolds Management Corp. v, Eischen
(1984) 158 Cal.App.3d 575... I
6
Commonwealth Mortgage Assurance Co. v. Superior Court
7 (1989) 211 Cal.App.3d 508... t2
Kqrlsen v. Americqn Sav, & Loan Assn.
8 (1971) 15 Cal.App.3d 112...... 8
9 Kwilrset Corp. v. Superior Court
(2011) 51 Cal.4th 310 ....... 10
10 Laddv. County of San Mateo
(1996) 12 Cal.4th 913 .............. .......
8
11
Lazar v. Superior Court
t2 (1996) t2Cal.4fh63r ..l0
Miles v. Deutsche Bank National Trust Co
13 (20 1 5) 23 6 Cal. App.4th 39 4 6
t4 Nymarkv. Heart Fed. Savings & Loan Assn.
(1991) 23t CaL App. 3d 1089.......... 9
15 Resolution Trust Corp. v. BVS Dev.
(9th Cir. 1994) 42F.3d 1206.. 9
t6
Sipe v. Countrywide Bank
t7 (2010) 690 F. Supp. 2drt4l. 9
Small v. Fritz Companies, Inc.
18 (2003) 30 Cal.4th 167 ............ 10
t9 T.G. McCarthy v. Grider
(192s) 72 CaI.App. 393.......... 8
20 Wyatt v. Union Mortgage Co.
(1979) 24 Cal.3d773 ........... 11
2l
Federal Cases
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In Re: Jqclcson
23 (201r ED Cal.) 4s1 B.R. 24............. ..2
Keenv Inc.\
24 2dr 11
25 Wongv. Am. Servicing Co., Inc.
2:09-CV-01506 FCD/DAD,2009 U.S. Dist. LEXIS 118012, 2009 V/L
26 5113516, at *6 (E.D. Cal. Dec. 18, 2009. 9
27 Statutes
Code of Civil Procedure
28 g 437c(a)... 1
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DOWLINGIAARON
MOTION FOR SUMMARY JUDGMENT OR, IN THE ALTERATIVE, SUMMARY ADruDICATION
1 Code of Civil Procedure
$ 437c(c)... ..........6
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Code of Civil Procedure
g a37c(f) 1
J
Code of Civil Procedure
4 $ a37c(pX2).......
5 Other Authorities
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Business & Professions Code
ç 17204..... 10
7 California Commercial Code
Section 3301......... 2
I California Commercial Code
Section 3203(a) )
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DOWLINGIAARON
MOTION FOR SUMMARY ruDGMENT OR, IN THE ALTERATIVE, SUMMARY ADruDICATION
I Defendant CITY NATIONAL BANK (hereinafter, .'CNB") hereby submits this
2 memorandum of points and authorities in support of its motion for summary judgment of issues
a
J pursuant to C.C.P. $ 437c(a), or, in the alternative, sunmary adjudication, C.C.P. $ 437c(f):
4 I. SUMMARY
5 This action arises from the plaintiff s default under a commercial loan agreement
6 related to the plaintiffls purchase of an apartment complex in Fresno, California. The plaintiff s
7 allegations ultimately fail to describe any wrongdoing and are controverted by their own
8 admissions and judicially noticeable facts. The reality is the plaintiff did not fulfill her
9 commitments under the commercial loan, including her failure to maintain the property. The
10 property fell into disrepair and plaintiff defaulted under the terms of the loan. Defendant CNB,
11 the owner of the promissory note and beneficiary under the deed of trust, foreclosed and
T2 purchased the property over four years ago, in November of 2014. There is no dispute as to
13 material facts and defendant CNB is entitled to summary judgment in its favor as to the entirety
t4 of the complaint.
15 N. F'ACTUAL BACKGROUND
t6 On or about December 26,2008, plaintiff obtained a loan from Imperial Capital
l7 Bank (hereinafter, "Imperial") in the amount of $1,350,000. (CNB's Separate State of Undisputed
18 Facts ("U.F." 1) The loan was in conjunction with her purchase of a 55-unit apartment complex
t9 located at 5358-5376 N. 6th Street in Fresno, California, just to the northeast of Fresno State
20 University's campus (the "Property"). (U.F. 1.) A true and correct copy of the Note, which
2l contains an endorsement by the Federal Deposit Insurance Corporation ("FDIC") to CNB, is
22 attached to the accompanying Request for Judicial Notice (RIN) and the Declaration of
23 Michael D. Rosenheck as Exhibits I and C, respectively.t p.f. t.¡
24 The Note was secured by a deed of trust in favor of Imperial which was recorded
25 against the Property (theoolmperial DOT"). (U.F. 2.) A true and correct copy of the Imperial DOT
26 is attached to the RJN as Exhibit J. The Imperial DOT was recorded in Fresno County on or
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One of the allegations of plaintiffs complaint is that the Note was never endorsed to CNB, however, it was. The
Complaint is attached to the Request for Judicial Noticeas Exhibit R,
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1
DOWLINGIAARON
MOTION FOR SUMMARY ruDGMENT OR, IN THE ALTERATIVE, SUMMARY ADruDICATION
1 about December 30, 2008.
2 On December 18, 2009, Imperial was closed by the California Department of
a
J Financial Institutions and the Federal Deposit Insurance Corporation (hereinafter, the "FDIC")
4 was named receiver. (U.F. 3.) Effective December 18,2009, the FDIC entered into a Purchase
5 and Assumption Agreement with CNB whereby FDIC transferred to CNB certain assets of
6 Imperial, including the plaintiffs loan. (U.F. 4.) A copy of the Purchase and Assumption
7 agreement can be found on the FDIC website at
8 httns ://www. fdic. sov/bank/indi tal P and A.odf. (U.F. 4.) Pursuant to
9 the Purchase and Assumption agreement, the Note and Imperial DOT were assigned by the FDIC
10 to CNB. (U.F. 5.) An assignment of the Imperial DOT was recorded on June 20, 2011, and the
11 Note was properly endorsed by the FDIC to CNB.2 (U.F. 5.) By operation of law, CNB became
12 the beneficiary under the Imperial DOT and holder of the Note.
13 Under Section 2.a@) of the Note, payments were due on the flrrst of each month.
t4 (U.F. 6.) Under Section 5 of the Note, there was a ten (10) day grace period during which time the
15 lender agrees not to assess a late charge.3 (U.F. 7.) However, if payment was not received within
T6 the 10 day grace period, the holder of the Note was entitled to charge alate fee and increased the
t7 interest rate of 18%. (U.F. 8.) (See the Note at Section 4.)
18 Throughout the course of the loan, plaintiff routinely failed to make timely
t9 payments. Plaintiff admits in the Complaint she made monthly payments "!2L oÍ before the 10th
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for CNB to be entitled to enforce the Note and
Regardless, endorsement of the Note was not a prerequisite
foreclose on the Imperial DOT. The California Commercial Code does not require an endorsement for a non-
2t holder in possession, with rights of a holder, to enforce aNote. (Commercial Code Sections 3301 and3203(a);
and In Re: Jacl