This document summarizes a court case involving allegations of wrongful foreclosure. It discusses the plaintiff's claims that the loan servicer engaged in fraudulent behavior during loan modification negotiations, including changing the terms of agreements and demanding unnecessary fees. The court found that the plaintiff had adequately stated claims for breach of contract, fraud, and misrepresentation. It reversed the lower court's dismissal of these claims and the granting of summary judgment on the wrongful foreclosure claim, finding factual disputes remained. The court concluded the plaintiff may be entitled to damages beyond just the lost property value if the foreclosure was wrongful.
State of wash case mandatory arbitration clause in an insurance contract wa...Umesh Heendeniya
This case involves a dispute over whether arbitration clauses in two insurance policies issued by James River Insurance Company to the Washington State Department of Transportation (WSDOT) are enforceable. The trial court denied James River's motion to compel arbitration, finding the clauses violated state statutes prohibiting agreements that deprive state courts of jurisdiction over actions against insurers. The Supreme Court of Washington affirms, finding that the statutes are intended to protect the right to bring an original action in state court and that binding arbitration deprives courts of jurisdiction to consider the substance of disputes.
This presentation discusses settlements of workers\' compensation cases in Florida. The discussion includes federal law affecting personal injury cases, MSA\'s and CMS participation. General contract principles are also explored.
This newsletter summarizes recent reinsurance case law developments. The first case discusses an 8th Circuit ruling that an endorsement incorporating a jurisdictional clause superseded an alternative dispute resolution clause. The second case discusses a New Jersey ruling staying litigation in favor of arbitration over an alleged breach involving an offset dispute. The third case discusses an Illinois ruling dismissing an assignee's request for pre-answer security and motion to compel arbitration against a sovereign-owned reinsurer.
McCarthy's longtime client Arnold Munson and his son Donald have been sued jointly for an automobile accident involving Donald. McCarthy has been representing Donald and the pleadings have now been amended to include Arnold. McCarthy can represent both defendants if he obtains informed consent in writing from both. They must understand the risks of sharing confidential information and limiting certain defenses, as well as the lawyer's conflicting duties of loyalty. So long as both consent is obtained, joint representation would not violate the Rules of Professional Conduct for this lawsuit.
1) Girardi & Stanton has a common law retaining lien that allows them to hold Mr. Gibson's files until their outstanding legal fees of $8,250 are paid. However, this retaining lien is passive and cannot be enforced through legal proceedings.
2) While Girardi & Stanton is entitled to the retaining lien, they must turn over copies of the files to Mr. Gibson and his new counsel to avoid prejudicing Mr. Gibson's legal matter against Cerone Wholesale Sporting Goods, as time is of the essence in that case.
3) Girardi & Stanton's assertion of the retaining lien to refuse to provide any files in this case would violate the rules of professional conduct
This document is an excerpt from an omnibus order written by the author for a judge regarding a credit card collection case. The order summarizes that while the plaintiff established a valid contract existed between the creditor and defendant, the plaintiff failed to provide sufficient documentation proving a valid assignment of the debt from the creditor to the plaintiff. As a result, the judge granted summary judgment for the defendant rather than the plaintiff.
This motion for summary judgment concerns whether a letter given to a dismissed employee constituted a termination agreement. The plaintiff worked for the defendant from 2005 to 2008 as a receptionist then executive assistant. In November 2008, she was unexpectedly dismissed and given a letter offering five months salary in lieu of notice. She signed the letter. A few days later, the employer said it made a mistake and the plaintiff was only entitled to three weeks pay. The court must determine if the letter was an offer accepted by the plaintiff's signature, creating a binding contract.
1) Girardi & Stanton have a common law retaining lien that allows them to hold Mr. Gibson's files until their outstanding legal fees are paid. However, this lien is passive and does not allow them to withhold the files indefinitely.
2) While Girardi & Stanton are entitled to the outstanding $8,250 fee, they must turn over copies of the files to Mr. Gibson and the new law firm so the case is not prejudiced. Retaining liens should only be asserted as a last resort to avoid harming the client.
3) Mr. Gibson and the new law firm are entitled to receive the files, as withholding them would delay the case against Cerone Sporting
State of wash case mandatory arbitration clause in an insurance contract wa...Umesh Heendeniya
This case involves a dispute over whether arbitration clauses in two insurance policies issued by James River Insurance Company to the Washington State Department of Transportation (WSDOT) are enforceable. The trial court denied James River's motion to compel arbitration, finding the clauses violated state statutes prohibiting agreements that deprive state courts of jurisdiction over actions against insurers. The Supreme Court of Washington affirms, finding that the statutes are intended to protect the right to bring an original action in state court and that binding arbitration deprives courts of jurisdiction to consider the substance of disputes.
This presentation discusses settlements of workers\' compensation cases in Florida. The discussion includes federal law affecting personal injury cases, MSA\'s and CMS participation. General contract principles are also explored.
This newsletter summarizes recent reinsurance case law developments. The first case discusses an 8th Circuit ruling that an endorsement incorporating a jurisdictional clause superseded an alternative dispute resolution clause. The second case discusses a New Jersey ruling staying litigation in favor of arbitration over an alleged breach involving an offset dispute. The third case discusses an Illinois ruling dismissing an assignee's request for pre-answer security and motion to compel arbitration against a sovereign-owned reinsurer.
McCarthy's longtime client Arnold Munson and his son Donald have been sued jointly for an automobile accident involving Donald. McCarthy has been representing Donald and the pleadings have now been amended to include Arnold. McCarthy can represent both defendants if he obtains informed consent in writing from both. They must understand the risks of sharing confidential information and limiting certain defenses, as well as the lawyer's conflicting duties of loyalty. So long as both consent is obtained, joint representation would not violate the Rules of Professional Conduct for this lawsuit.
1) Girardi & Stanton has a common law retaining lien that allows them to hold Mr. Gibson's files until their outstanding legal fees of $8,250 are paid. However, this retaining lien is passive and cannot be enforced through legal proceedings.
2) While Girardi & Stanton is entitled to the retaining lien, they must turn over copies of the files to Mr. Gibson and his new counsel to avoid prejudicing Mr. Gibson's legal matter against Cerone Wholesale Sporting Goods, as time is of the essence in that case.
3) Girardi & Stanton's assertion of the retaining lien to refuse to provide any files in this case would violate the rules of professional conduct
This document is an excerpt from an omnibus order written by the author for a judge regarding a credit card collection case. The order summarizes that while the plaintiff established a valid contract existed between the creditor and defendant, the plaintiff failed to provide sufficient documentation proving a valid assignment of the debt from the creditor to the plaintiff. As a result, the judge granted summary judgment for the defendant rather than the plaintiff.
This motion for summary judgment concerns whether a letter given to a dismissed employee constituted a termination agreement. The plaintiff worked for the defendant from 2005 to 2008 as a receptionist then executive assistant. In November 2008, she was unexpectedly dismissed and given a letter offering five months salary in lieu of notice. She signed the letter. A few days later, the employer said it made a mistake and the plaintiff was only entitled to three weeks pay. The court must determine if the letter was an offer accepted by the plaintiff's signature, creating a binding contract.
1) Girardi & Stanton have a common law retaining lien that allows them to hold Mr. Gibson's files until their outstanding legal fees are paid. However, this lien is passive and does not allow them to withhold the files indefinitely.
2) While Girardi & Stanton are entitled to the outstanding $8,250 fee, they must turn over copies of the files to Mr. Gibson and the new law firm so the case is not prejudiced. Retaining liens should only be asserted as a last resort to avoid harming the client.
3) Mr. Gibson and the new law firm are entitled to receive the files, as withholding them would delay the case against Cerone Sporting
This document summarizes a decision by the Ohio Board of Tax Appeals regarding tax valuations for property owned by Kohl's Department Stores for tax years 2010 and 2013. The Board consolidated two cases regarding the same property. For tax year 2010, Kohl's appealed the dismissal of its complaint seeking a lower valuation. For tax year 2013, Kohl's appealed the denial of its request to lower the valuation. The Board remanded the 2010 case back to the local board to consider the valuation, as the county appellees failed to prove a covenant in a TIF agreement barred Kohl's appeal. For 2013, the Board found Kohl's did not provide sufficient evidence to prove its requested lower valuation.
Jones v. Arjun re Costs (2015 BCSC 1881)Kate Taylor
This ruling addresses costs in a personal injury case involving two motor vehicle accidents. The court found the plaintiff's injuries from the two accidents were indivisible. The plaintiff made an offer to settle for more than was ultimately awarded at trial. The court ruled the plaintiff was entitled to double costs after the date of the settlement offer, finding the offer was reasonably capable of acceptance given the medical evidence establishing indivisible injuries and risks to the defendants.
Real time Attorney advice memo priviledged and confidentialnicemanin
Morris Associates Engineering Consultants filed a mechanic's lien for $19,425.82 for engineering services provided to Orchard Hill Farms between 2007-2008. Orchard Hill Farms argues the lien should be dismissed for two reasons: 1) Morris Associates breached its contract by not completing all services and 2) the lien amount was willfully exaggerated in violation of NY Lien Law. If the lien is voided for exaggeration, Morris Associates would be liable for damages under Lien Law §39a including attorney fees.
Law Society of Singapore v Tan Phuay Khiang [2007] SGHC 83surrenderyourthrone
This document summarizes a court case from 2007 regarding a lawyer, Tan Phuay Khiang, who was accused of misconduct in his representation of clients in the sale of their home. Specifically:
1) Tan represented clients in selling their home, but prepared documents authorizing distribution of sale proceeds to parties he had previous relationships with, including ones who referred clients to him, without properly advising the clients or protecting their interests.
2) A disciplinary committee found Tan guilty of failing to advance his clients' interests, but dismissed other charges regarding specific documents.
3) The court ultimately suspended Tan from practice for two years for his misconduct in handling conflicts of interest and not protecting his clients.
SC Judgement - Appointment Of Third ArbitratorFlame Of Truth
The SC judgement by Justice S S Nijjar in the matter between Reliance Industries Ltd and others versus Union of India, arbitration petition filed by Reliance for appointment of the third and the presiding arbitrator.
The anti slapp statute is now a powerful tool to discourage enforcement of no...Keystone Law
Statutory changes have further limited the applicability of no contest clauses to apply only to certain specific types of legal actions – the most common being direct attacks on the estate planning documents themselves, known as “direct contests”
Published September 2012 in The ESOP Association's ESOP Report
Steve Greenapple addresses breach of fiduciary duty and federal common law fraud by participants who transferred their 401(k) account balances to an ESOP, against the sponsor of the Plans, fiduciaries of the Plans and the ESOP's financial advisor.
New York Appeals Court Sustains Asbestos Plaintiff's Direct Suit Against Liab...NationalUnderwriter
New York Appeals Court Sustains Asbestos Plaintiff's Direct Suit Against Liability Insurer of Dissolved Corporate Defendant. Can an asbestos bodily injury plaintiff directly sue the liability insurer of a dissolved corporate defendant? Yes, said New York’s Appellate Division, First Department – under certain circumstances. The court’s decision came in cases under In re New York City Asbestos Litigation, et al.[1]
Restoring the Corners to Contracts- David J. Myers, ESQ.Debi Myers
1. The document discusses changes to California's parole evidence rule regarding fraud exceptions. Previously, oral inducements inconsistent with written contracts could not be used to claim fraud. However, a recent court case now allows such claims to prevent fraudulent inducement.
2. Going forward, contract expectations will be less certain as fraud claims and litigation focusing on parties' intent and reliance will be more common. Boilerplate clauses will provide less protection. Sophistication of parties and reasonableness of reliance will be important factors.
3. Some potential limitations discussed include failing to read a contract, sophistication of parties, bargaining power differences, and failure to investigate. Reformation of contract terms based on fraud may also now be available
This newsletter provides summaries of recent reinsurance case law and regulatory developments from March 2014. It includes summaries of cases from New York, Tennessee, and California federal courts related to arbitration awards, protected cell reinsurance agreements, preclusion of subsequent arbitrations, and common interest privilege with reinsurers. It also summarizes cases related to tax treatment of retrocessional agreements, dismissal of defenses in a facultative reinsurance dispute, denial of stay in a mortgage reinsurance case, and assumption versus reinsurance.
The document summarizes the key elements of a valid contract under Nepalese law:
1. Offer and acceptance between two parties with free consent are required. Consent must be free from coercion, undue influence, fraud or misrepresentation.
2. The terms of the contract must be certain and performance must be possible. Object and consideration must also be lawful.
3. Parties must have capacity to contract and intention to create legal obligations. Agreements may be invalid if illegal, against public policy, or create unreasonable restraint of trade.
4. Time, manner and place of performance are based on agreement or reasonableness. Damages for breach are compensatory, not punitive, and limited
The court granted a motion to add additional judgment debtors to a $1.8 million judgment against plaintiff Stephen Gaggero. The additional judgment debtors included six entities (four limited partnerships and two LLCs) that were formerly owned by Gaggero, totaling $35-40 million in assets in 1998. It also included the trustee, Joseph Praske, of three trusts that now owned the entities, after Gaggero transferred ownership of the entities to the trusts in 1998 as part of an "estate plan". The court found all were alter egos of Gaggero based on evidence that Gaggero controlled the entities and trusts, and used them to avoid creditors like the defendants in this case. The additional judgment
D'Agostino v Federal Ins Co , 969 F. Supp. 2d 116 (D. Mass. 2013)Richard Goren
1) The parties engaged in settlement negotiations but did not reach an enforceable agreement because while D'Agostino offered $1.15 million for a release, Federal responded with a release containing additional material terms like confidentiality requirements, which were not accepted.
2) The court denied Federal's motions to enforce the alleged settlement agreement and for protective orders, finding no agreement was formed.
3) The court also denied requests for sanctions from both parties, finding neither party's actions warranted sanctions.
Judge Mosman avoided directly ruling on the application of SB 814 to the defense costs being sought by Schnitzer, instead holding that Schnitzer was judicially estopped from arguing that its defense counsel was "independent counsel" subject to SB 814.
The document is a Supreme Judicial Court case regarding whether real estate salespersons were properly classified as independent contractors rather than employees. The court summarized that real estate salespersons brought a lawsuit claiming they were misclassified, but the trial court ruled that the independent contractor statute did not apply to real estate salespersons based on the real estate licensing statute. On appeal, the Supreme Judicial Court affirmed the lower court's ruling.
Statements Made by Insurance Company¹s Employees Can Be Used as Evidence That...NationalUnderwriter
Statements Made by Insurance Company¹s Employees Can Be Used as Evidence That It Must Provide a Defense.
by Graham C. Mills
The Court of Appeal of California, in North Counties Engineering, Inc. v. State Farm General Insurance Co., recently issued a significant opinion finding that statements and notes made by an insurance company’s employee can be used as evidence that an insurance company has a duty to defend its policyholder in a lawsuit. This opinion is important because insurance companies often will argue that such statements and notes cannot be used to establish a duty to defend because such duty only exists when the insurance policy provides coverage against a complaint’s allegations, regardless of what insurance company employees say or write.
Mr. A entered into a contract with Mr. D's commission house to purchase gold futures at a set price in April 2017. When gold prices fell, Mr. A owed losses but argued the contract should be void under the Consumer Contract Act. The district court dismissed the claim but the supreme court granted it, finding future price fluctuations could be an "important matter". However, the supreme court ultimately dismissed the claim, clarifying that uncertain future matters are not considered "important" under the Act. The presentation discusses this case and debates what should constitute an important matter in consumer contracts.
Pollard PLLC represents 7 real estate brokers and their new company KD Premier Realty against their former employer, Properties of the Villages. In the attached document, the Magistrate Judge has recommended that Plaintiff's Motion for Preliminary Injunction be denied. The case is pending in the United States District Court for the Middle District of Florida. The Firm can be reached at 954-332-2380.
Constructive trusts arise by operation of law when it would be unfair for a person to deny a beneficial interest in property to another. There are two main types - institutional constructive trusts, which develop through case law, and remedial constructive trusts used to allocate property interests equitably when a relationship breaks down. Constructive trusts can arise in several situations, including when there is a breach of fiduciary duty, when strangers receive trust property knowing it was transferred in breach of trust, through agreements to create secret trusts or mutual wills, and when statutes are used as an "engine of fraud." Equitable principles prevent unjust enrichment through constructive trusts.
Gaggero-Arenzano Interest, '97-'07, in a Class of Beneficiariesjamesmaredmond
The plaintiff's closing argument summarizes four trust documents that were disclosed pursuant to a court order. The documents establish trusts known as the Arenzano Trust and Terra Mar Trust. The plaintiff argues that the trusts were created by the defendant Steve Gaggero in an attempt to shield his assets from liability related to fraudulent conduct against the plaintiffs. Specifically, the plaintiff points to evidence that Gaggero controlled the entities in question and their assets despite being removed as a beneficiary of one trust just as he defrauded the plaintiffs. The plaintiff requests the court find Gaggero and the entities jointly and severally liable for fraud and the return of plaintiffs' money.
Fleet v. Bank of America case from California Court of AppealLegalDocsPro
This Fleet v. Bank of America case was recently decided by a California Court of Appeal. This case was decided by Division Three of the Fourth District Court of Appeal on August 25, 2014, on September 23, 2014 the Court granted the request of several parties for publication. The case involved allegations by the Fleets of fraud on the part of Bank of America during the loan modification process.
The Court of Appeal reversed the Judgment entered in the case and reversed the order sustaining the demurrer to the cause of action for fraud as to Bank of America and several other individual defendants, as well as reversing the order sustaining demurrers to the breach of contract and promissory estoppel causes of action against Bank of America athough the Court did affirm the order sustaining the demurrers without leave to amend against several other defendants including Recon Trust. The Court also affirmed the order sustaining the demurrer to the cause of action for accounting without leave to amend. This case is very good news in my opinion as this case may represent a turning point as it is the only published case from California that I am aware of in which an appeals Court appears to be at least considering the possibility that the big banks may be engaging in a pattern of fraud and deceit.
Express working capital llc v Starving Students IncM P
Synopsis
Background: Buyer of corporation's future credit card receivables brought action against seller-corporation and its owner, alleging breach of contract, promissory estoppel, fraud, and fraudulent inducement. Defendants asserted usury defense and counterclaim. Parties cross-moved for summary judgment.
This document summarizes a decision by the Ohio Board of Tax Appeals regarding tax valuations for property owned by Kohl's Department Stores for tax years 2010 and 2013. The Board consolidated two cases regarding the same property. For tax year 2010, Kohl's appealed the dismissal of its complaint seeking a lower valuation. For tax year 2013, Kohl's appealed the denial of its request to lower the valuation. The Board remanded the 2010 case back to the local board to consider the valuation, as the county appellees failed to prove a covenant in a TIF agreement barred Kohl's appeal. For 2013, the Board found Kohl's did not provide sufficient evidence to prove its requested lower valuation.
Jones v. Arjun re Costs (2015 BCSC 1881)Kate Taylor
This ruling addresses costs in a personal injury case involving two motor vehicle accidents. The court found the plaintiff's injuries from the two accidents were indivisible. The plaintiff made an offer to settle for more than was ultimately awarded at trial. The court ruled the plaintiff was entitled to double costs after the date of the settlement offer, finding the offer was reasonably capable of acceptance given the medical evidence establishing indivisible injuries and risks to the defendants.
Real time Attorney advice memo priviledged and confidentialnicemanin
Morris Associates Engineering Consultants filed a mechanic's lien for $19,425.82 for engineering services provided to Orchard Hill Farms between 2007-2008. Orchard Hill Farms argues the lien should be dismissed for two reasons: 1) Morris Associates breached its contract by not completing all services and 2) the lien amount was willfully exaggerated in violation of NY Lien Law. If the lien is voided for exaggeration, Morris Associates would be liable for damages under Lien Law §39a including attorney fees.
Law Society of Singapore v Tan Phuay Khiang [2007] SGHC 83surrenderyourthrone
This document summarizes a court case from 2007 regarding a lawyer, Tan Phuay Khiang, who was accused of misconduct in his representation of clients in the sale of their home. Specifically:
1) Tan represented clients in selling their home, but prepared documents authorizing distribution of sale proceeds to parties he had previous relationships with, including ones who referred clients to him, without properly advising the clients or protecting their interests.
2) A disciplinary committee found Tan guilty of failing to advance his clients' interests, but dismissed other charges regarding specific documents.
3) The court ultimately suspended Tan from practice for two years for his misconduct in handling conflicts of interest and not protecting his clients.
SC Judgement - Appointment Of Third ArbitratorFlame Of Truth
The SC judgement by Justice S S Nijjar in the matter between Reliance Industries Ltd and others versus Union of India, arbitration petition filed by Reliance for appointment of the third and the presiding arbitrator.
The anti slapp statute is now a powerful tool to discourage enforcement of no...Keystone Law
Statutory changes have further limited the applicability of no contest clauses to apply only to certain specific types of legal actions – the most common being direct attacks on the estate planning documents themselves, known as “direct contests”
Published September 2012 in The ESOP Association's ESOP Report
Steve Greenapple addresses breach of fiduciary duty and federal common law fraud by participants who transferred their 401(k) account balances to an ESOP, against the sponsor of the Plans, fiduciaries of the Plans and the ESOP's financial advisor.
New York Appeals Court Sustains Asbestos Plaintiff's Direct Suit Against Liab...NationalUnderwriter
New York Appeals Court Sustains Asbestos Plaintiff's Direct Suit Against Liability Insurer of Dissolved Corporate Defendant. Can an asbestos bodily injury plaintiff directly sue the liability insurer of a dissolved corporate defendant? Yes, said New York’s Appellate Division, First Department – under certain circumstances. The court’s decision came in cases under In re New York City Asbestos Litigation, et al.[1]
Restoring the Corners to Contracts- David J. Myers, ESQ.Debi Myers
1. The document discusses changes to California's parole evidence rule regarding fraud exceptions. Previously, oral inducements inconsistent with written contracts could not be used to claim fraud. However, a recent court case now allows such claims to prevent fraudulent inducement.
2. Going forward, contract expectations will be less certain as fraud claims and litigation focusing on parties' intent and reliance will be more common. Boilerplate clauses will provide less protection. Sophistication of parties and reasonableness of reliance will be important factors.
3. Some potential limitations discussed include failing to read a contract, sophistication of parties, bargaining power differences, and failure to investigate. Reformation of contract terms based on fraud may also now be available
This newsletter provides summaries of recent reinsurance case law and regulatory developments from March 2014. It includes summaries of cases from New York, Tennessee, and California federal courts related to arbitration awards, protected cell reinsurance agreements, preclusion of subsequent arbitrations, and common interest privilege with reinsurers. It also summarizes cases related to tax treatment of retrocessional agreements, dismissal of defenses in a facultative reinsurance dispute, denial of stay in a mortgage reinsurance case, and assumption versus reinsurance.
The document summarizes the key elements of a valid contract under Nepalese law:
1. Offer and acceptance between two parties with free consent are required. Consent must be free from coercion, undue influence, fraud or misrepresentation.
2. The terms of the contract must be certain and performance must be possible. Object and consideration must also be lawful.
3. Parties must have capacity to contract and intention to create legal obligations. Agreements may be invalid if illegal, against public policy, or create unreasonable restraint of trade.
4. Time, manner and place of performance are based on agreement or reasonableness. Damages for breach are compensatory, not punitive, and limited
The court granted a motion to add additional judgment debtors to a $1.8 million judgment against plaintiff Stephen Gaggero. The additional judgment debtors included six entities (four limited partnerships and two LLCs) that were formerly owned by Gaggero, totaling $35-40 million in assets in 1998. It also included the trustee, Joseph Praske, of three trusts that now owned the entities, after Gaggero transferred ownership of the entities to the trusts in 1998 as part of an "estate plan". The court found all were alter egos of Gaggero based on evidence that Gaggero controlled the entities and trusts, and used them to avoid creditors like the defendants in this case. The additional judgment
D'Agostino v Federal Ins Co , 969 F. Supp. 2d 116 (D. Mass. 2013)Richard Goren
1) The parties engaged in settlement negotiations but did not reach an enforceable agreement because while D'Agostino offered $1.15 million for a release, Federal responded with a release containing additional material terms like confidentiality requirements, which were not accepted.
2) The court denied Federal's motions to enforce the alleged settlement agreement and for protective orders, finding no agreement was formed.
3) The court also denied requests for sanctions from both parties, finding neither party's actions warranted sanctions.
Judge Mosman avoided directly ruling on the application of SB 814 to the defense costs being sought by Schnitzer, instead holding that Schnitzer was judicially estopped from arguing that its defense counsel was "independent counsel" subject to SB 814.
The document is a Supreme Judicial Court case regarding whether real estate salespersons were properly classified as independent contractors rather than employees. The court summarized that real estate salespersons brought a lawsuit claiming they were misclassified, but the trial court ruled that the independent contractor statute did not apply to real estate salespersons based on the real estate licensing statute. On appeal, the Supreme Judicial Court affirmed the lower court's ruling.
Statements Made by Insurance Company¹s Employees Can Be Used as Evidence That...NationalUnderwriter
Statements Made by Insurance Company¹s Employees Can Be Used as Evidence That It Must Provide a Defense.
by Graham C. Mills
The Court of Appeal of California, in North Counties Engineering, Inc. v. State Farm General Insurance Co., recently issued a significant opinion finding that statements and notes made by an insurance company’s employee can be used as evidence that an insurance company has a duty to defend its policyholder in a lawsuit. This opinion is important because insurance companies often will argue that such statements and notes cannot be used to establish a duty to defend because such duty only exists when the insurance policy provides coverage against a complaint’s allegations, regardless of what insurance company employees say or write.
Mr. A entered into a contract with Mr. D's commission house to purchase gold futures at a set price in April 2017. When gold prices fell, Mr. A owed losses but argued the contract should be void under the Consumer Contract Act. The district court dismissed the claim but the supreme court granted it, finding future price fluctuations could be an "important matter". However, the supreme court ultimately dismissed the claim, clarifying that uncertain future matters are not considered "important" under the Act. The presentation discusses this case and debates what should constitute an important matter in consumer contracts.
Pollard PLLC represents 7 real estate brokers and their new company KD Premier Realty against their former employer, Properties of the Villages. In the attached document, the Magistrate Judge has recommended that Plaintiff's Motion for Preliminary Injunction be denied. The case is pending in the United States District Court for the Middle District of Florida. The Firm can be reached at 954-332-2380.
Constructive trusts arise by operation of law when it would be unfair for a person to deny a beneficial interest in property to another. There are two main types - institutional constructive trusts, which develop through case law, and remedial constructive trusts used to allocate property interests equitably when a relationship breaks down. Constructive trusts can arise in several situations, including when there is a breach of fiduciary duty, when strangers receive trust property knowing it was transferred in breach of trust, through agreements to create secret trusts or mutual wills, and when statutes are used as an "engine of fraud." Equitable principles prevent unjust enrichment through constructive trusts.
Gaggero-Arenzano Interest, '97-'07, in a Class of Beneficiariesjamesmaredmond
The plaintiff's closing argument summarizes four trust documents that were disclosed pursuant to a court order. The documents establish trusts known as the Arenzano Trust and Terra Mar Trust. The plaintiff argues that the trusts were created by the defendant Steve Gaggero in an attempt to shield his assets from liability related to fraudulent conduct against the plaintiffs. Specifically, the plaintiff points to evidence that Gaggero controlled the entities in question and their assets despite being removed as a beneficiary of one trust just as he defrauded the plaintiffs. The plaintiff requests the court find Gaggero and the entities jointly and severally liable for fraud and the return of plaintiffs' money.
Fleet v. Bank of America case from California Court of AppealLegalDocsPro
This Fleet v. Bank of America case was recently decided by a California Court of Appeal. This case was decided by Division Three of the Fourth District Court of Appeal on August 25, 2014, on September 23, 2014 the Court granted the request of several parties for publication. The case involved allegations by the Fleets of fraud on the part of Bank of America during the loan modification process.
The Court of Appeal reversed the Judgment entered in the case and reversed the order sustaining the demurrer to the cause of action for fraud as to Bank of America and several other individual defendants, as well as reversing the order sustaining demurrers to the breach of contract and promissory estoppel causes of action against Bank of America athough the Court did affirm the order sustaining the demurrers without leave to amend against several other defendants including Recon Trust. The Court also affirmed the order sustaining the demurrer to the cause of action for accounting without leave to amend. This case is very good news in my opinion as this case may represent a turning point as it is the only published case from California that I am aware of in which an appeals Court appears to be at least considering the possibility that the big banks may be engaging in a pattern of fraud and deceit.
Express working capital llc v Starving Students IncM P
Synopsis
Background: Buyer of corporation's future credit card receivables brought action against seller-corporation and its owner, alleging breach of contract, promissory estoppel, fraud, and fraudulent inducement. Defendants asserted usury defense and counterclaim. Parties cross-moved for summary judgment.
The document provides a summary of recent case law updates from the Colorado Supreme Court and Colorado Court of Appeals, as well as announcements from the US District Court of Colorado regarding electronic case filing requirements. Key cases summarized include the Colorado Supreme Court interpreting the term "presently resides" in the Child Custody Act, the Court of Appeals finding that a "road rage" incident did not trigger uninsured motorist coverage, and the 10th Circuit Court of Appeals applying the automatic bankruptcy stay to all appeals involving a debtor. The document also lists the current CDLA directors.
Sulphur Moutain vs. John Redmond, et al - B238767jamesmaredmond
This document summarizes a court case involving a dispute over the sale of a home to satisfy an unpaid judgment. The plaintiff obtained a judgment against the defendants and sought to enforce it by selling their home. The defendants claimed a homestead exemption to protect part of the equity in their home. The trial court approved the sale of the home, finding the defendants could not claim the exemption again since they used it in a prior bankruptcy proceeding. The appellate court reversed, finding no basis for the plaintiff's argument that the homestead exemption can only be used once. The appellate court also found the plaintiff's lien on the property was effective as of 2002, not the later date determined by the trial court. The case was remanded for further proceedings consistent
This order addresses the plaintiffs' motion for a temporary restraining order against the defendant. The court finds that the plaintiffs have sufficiently shown they have a protected interest in trade secrets and confidential information. They have also shown irreparable harm if an injunction is not granted, as the defendant is allegedly using protected information to directly compete with the plaintiffs in violation of a non-compete agreement. Additionally, the plaintiffs have no adequate legal remedy and have raised fair questions that they will likely succeed on their claims of breach of contract, trade secret misappropriation, and trademark infringement. Therefore, the court will grant the plaintiffs' motion for a temporary restraining order to preserve the status quo until a hearing can be held on a preliminary injunction.
This document is a motion for stay of judgment pending appeal filed by defendant Eurasian Auto Body, Inc. It requests that the court stay execution of the judgment for possession entered against Eurasian on April 2, 2010 while Eurasian appeals the judgment. The motion argues that Eurasian will suffer extreme hardship if forced to vacate the premises pending appeal as it would incur over $200,000 in moving costs. It also argues that the plaintiff will not be harmed by a stay as long as Eurasian pays rent during the stay period. The motion includes supporting declarations from Eurasian's attorney and principal.
City Water International Inc. v. Wax Hairdressing Inc.Matthew Riddell
This case involves a dispute over a renewal contract for the rental of a water cooler. The plaintiff, City Water International Inc., claimed the defendant, Wax Hairdressing Inc., breached the renewal contract by failing to make payments. The court found that the individual who signed the renewal contract on behalf of Wax Hairdressing had apparent authority to bind the company. The court also found Wax Hairdressing was estopped from arguing it was not bound by the contract given it made payments according to the contract for years. The court awarded damages of $1879.25 to the plaintiff.
Washington Court Holds Stipulated Covenant Judgment Sets Minimum Amount of Da...NationalUnderwriter
Washington Court Holds Stipulated Covenant Judgment Sets Minimum Amount of Damages in Bad Faith Case. (from FC&S Legal: The Insurance Coverage Law Information Center)
Recently, Division One of the Court of Appeals of Washington State affirmed a jury verdict awarding $13 million in damages to a passenger injured in a car accident, finding that the $4.15 million agreed amount of the covenant
judgment in the insurance bad faith case sets a floor, not a ceiling, on the damages a jury can award.
In Miller v. Kenny and Safeco Ins. Co.,[1] the Court of Appeals ruled on several additional issues on appeal including whether evidence of an insurance company’s loss reserves is properly admissible at trial.
The document provides an overview of security of payment claims under the NSW Building and Construction Industry Security of Payment Act 1999. It outlines the key steps if a party is served with a security of payment claim, including serving a payment schedule within 10 days and potential adjudication of the claim if payment is withheld. The summary also details what should be included in payment claims, payment schedules, adjudication applications and responses to adhere to the strict time limits under the Act.
This document discusses a bankruptcy court case regarding the sale of an internet domain name. The key points are:
1) The debtor (Heath Global) had agreed to purchase the "Invest.com" domain name from Jim Magner for $2 million in installments over two years.
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TEXTO: JEREMIAS 38:19-20
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En el texto que hemos leído vemos el momento de angustia que el rey Sedequias tenía cuando Jerusalén estaba rodeada por el ejército babilonio.
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Que nos dice la voz de Dios este dia a cada uno de nosotros: FILIPENSES 4:13 “Todo lo puedo en Cristo que me fortalece”
Tenemos que escuchar la voz de nuestro Dios por sobre cualquier voz en nuestra vida,
I)DEBEMOS ESCUCHAR LA VOZ DE DIOS POR SOBRE LA VOZ DE LA EXPERIENCIA (LUCAS 5:4-6)
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Miles v. deutsche bank national trust company | find law
1. FindLaw Caselaw California CA Ct. App. MILES v. DEUTSCHE BANK NATIONAL TRUST COMPANY
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MILES v. DEUTSCHE BANK NATIONAL TRUST
COMPANY
Court of Appeal, Fourth District, Division 3, California.
John MILES, Plaintiff and Appellant, v. DEUTSCHE BANK NATIONAL TRUST
COMPANY et al., Defendants and Respondents.
G050294
Decided: April 29, 2015
Alessi & Koening, Ryan Kerbow and Thomas J. Bayard for Plaintiff and Appellant. Houser & Allison, Eric D.
Houser, Brian J. Wagner, and Eileen M. Horschel for Defendants and Respondents.
OPINION
This case involves allegations of a wrongful foreclosure and related causes of action. Plaintiff John Miles
appeals from a judgment dismissing his breach of contract, fraud, and negligent misrepresentation causes of
action pursuant to a sustained demurrer, and a summary judgment in favor of defendants on the wrongful
foreclosure cause of action.
With respect to the demurred causes of action, we reverse. In the record before us, the court did not offer any
explanation for its ruling. Based on our independent review of the complaint, we conclude plaintiff
adequately stated his claims.
With respect to the wrongful foreclosure cause of action, we also reverse. The court granted summary
judgment on the sole basis that plaintiff could not prove damages because he did not have any equity in the
home when it was sold at a non-judicial foreclosure sale. Wrongful foreclosure is a tort, however, and thus
plaintiff may recover any damages proximately caused by defendants' wrongdoing. Plaintiff offered evidence
that he lost rental income and suffered emotional distress as a result of the foreclosure. This is disputed, of
course, but it is sufficient to survive a summary judgment motion.
I.
The DemurrerFACTS ALLEGED IN THE FIRST AMENDED COMPLAINT
Plaintiff owned property in Riverside. In July 2005, plaintiff refinanced the loan on his property with a total
loan amount of $815,000. This was an adjustable rate mortgage. The loan was serviced by defendant
HomEq Servicing (HomEq). For the first 21 months of the loan, plaintiff was current on his payments.
During the period between June 2007 and September 2007, the monthly payment on the loan increased first
to $5,968 per month, and then to $6,800 per month.
In August 2007, plaintiff applied for a loan modification to try making payments more affordable. In
February 2008, HomEq informed plaintiff that he had to make “a lump sum $12,000 payment as a
‘modification processing fee’ before Plaintiff could ․ see the terms of the proposed modification.” Plaintiff
paid the fee. In March 2008, HomEq gave plaintiff a loan modification agreement, to which the parties
agreed. Under the terms of that agreement, plaintiff's loan balance was increased to $834,051.86. The
interest rate was fixed at 5.990 percent (the prior rate was 7.490 percent), and the monthly payment would be
$6,236.78. Plaintiff made a payment under that agreement,1 but the next month HomEq stated they would
no longer honor the terms of that agreement. Instead, HomEq sent a new agreement that increased the loan
balance to $870,767.34. It offered no explanation for the change.
Plaintiff believed the March 2008 agreement was valid, and thus he made payments to HomEq under that
agreement for March, April, and June of 2008, totaling $18,789. In June 2008, HomEq sent plaintiff yet
another loan modification agreement, this time raising the balance to $895,117.18, again without explanation.
In July 2008, HomEq sent correspondence to plaintiff demanding a payment of $35,684 to process a new loan
modification. HomEq then began refusing plaintiff's payments under the March 2008 agreement, requiring
that he pay $7,600 per month instead. When plaintiff insisted on the terms of the March 2008 agreement,
HomEq recorded a notice of default and election to sell the property. In October 2008, HomEq recorded a
notice of trustee's sale of the property with a sale date of November 20, 2008.
HomEq then informed plaintiff it would give him a new modification if he would send a payment of $14,050.
In light of the looming sale date, plaintiff complied. Instead of sending a loan modification agreement,
however, HomEq sent a forebearance agreement and demanded a payment of $1,450 before it would send a
modification agreement.
Plaintiff continued trying to work with HomEq until February 2009, when HomEq sent another loan
modification agreement, this time asking for an upfront payment of $29,771. “Having paid $44,000.00 over a
10 month period for modifications that never materialized, Plaintiff had no faith that any further payments
would have any better result so he declined to make the requested payment.”
Defendants set a sale date for plaintiff's house of March 23, 2009. On March 19, 2009, plaintiff obtained a
temporary restraining order against the sale of his house from the Riverside County Superior Court. Plaintiff
alleges on information and belief that defendants had notice of the order. Nonetheless, defendants proceeded
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MILES v. DEUTSCHE BANK NATIONAL TRUST COMPAN... http://caselaw.findlaw.com/ca-court-of-appeal/1699245.html
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2. with the sale on March 23, 2009, and dispossessed plaintiff.
PROCEDURAL HISTORY
Plaintiff filed suit against defendants Deutsche Bank National Trust Company, the purported owner of the
loan, and HomEq Servicing, which serviced the loan.2 Defendants demurred to plaintiff's first amended
complaint, and the court sustained the demurrer as to the causes of action for breach of contract, fraud, and
negligent misrepresentation.3 The court did not give any indication of the basis of its ruling, and we were not
provided a record of the hearing. The court gave plaintiff 30 days leave to amend, which plaintiff chose not to
do.
Defendants then moved for summary judgment on the lone remaining cause of action for wrongful foreclosure,
which the court granted (the facts and procedural history pertinent to the summary judgment motion will be
discussed below). Plaintiff timely appealed.
DISCUSSION
“On appeal from a judgment dismissing an action after sustaining a demurrer ․, the standard of review is well
settled. The reviewing court gives the complaint a reasonable interpretation, and treats the demurrer as
admitting all material facts properly pleaded. [Citations.] The court does not, however, assume the truth of
contentions, deductions or conclusions of law. [Citation.] The judgment must be affirmed ‘if any one of the
several grounds of demurrer is well taken. [Citations.]’ [Citation.] However, it is error for a trial court to
sustain a demurrer when the plaintiff has stated a cause of action under any possible legal theory.” (Aubry v.
Tri–City Hospital Dist. (1992) 2 Cal.4th 962, 966–967.)
We begin by quickly dispensing with an argument that runs throughout respondents' brief: “Plaintiff's fraud,
breach of contract and negligent misrepresentation causes of action were not sustained without leave to
amend, they were sustained with 30 days leave to amend. Plaintiff chose to not file a timely amended
complaint pursuant to the trial Court's order and therefore voluntarily abandoned those causes of action.
Plaintiff cannot appeal his decision not to pursue the other causes of action.” Defendants cite no authority for
this remarkable proposition, and it would be an absurd rule indeed. If a plaintiff had already stated all
available facts, but was given an opportunity to amend, how could forfeiture be avoided under defendants'
rule? By making up facts? That is not the law. Even if given an opportunity to amend, a plaintiff may
stand on the sufficiency of the complaint. (County of Santa Clara v. Atlantic Richfield Co. (2006) 137
Cal.App.4th 292, 312[“[w]hen a demurrer is sustained with leave to amend, and the plaintiff chooses not to
amend but to stand on the complaint, an appeal from the ensuing dismissal order may challenge the validity of
the intermediate ruling sustaining the demurrer”].) There was no forfeiture.
Next, defendants contend the demurrer to the breach of contract cause of action was properly sustained
because the complaint “does not allege whether the contract was in writing, oral or implied.” (See Code Civ.
Proc., § 430.10, subd. (g) [complaint demurrable if, “[i]n an action founded upon a contract, it cannot be
ascertained from the pleading whether the contract is written, is oral, or is implied by conduct”].) This is a
purely technical argument, as defendants' summary judgment motion demonstrates they knew which contract
was at issue, were in possession of it, and thus knew it was in writing. The problem with this purely technical
argument is that defendants did not comply with their own technicalities. Defendants' demurrer did not
mention Code of Civil Procedure section 430.10, subdivision (g). Instead, the demurrer simply stated,
“Plaintiff's third cause of action for breach of contract does not state facts sufficient to constitute a cause of
action against Defendants. (Cal.Code Civ. Proc. §§ 430.10(e) and (f).)” We will not uphold a demurrer on a
technicality not asserted in the trial court. Further, as noted above, plaintiff alleged that in March 2008,
HomEq gave plaintiff a loan modification agreement, to which the parties agreed. And specific terms of that
agreement are alleged, such as the balance of the loan, the interest rate, and the required monthly payments.
A reasonable inference drawn from those allegations is that the contract plaintiff relies upon, the March 2008
modification agreement, was in writing.
Defendants' only remaining argument in support of the dismissal of the breach of contract cause of action is
that plaintiff failed to attach the contract or to plead its terms verbatim. In support of that argument,
defendants cite Otworth v. Southern Pac. Transportation Co. (1985) 166 Cal.App.3d 452, 459 (Otworth ), which
stated, “If the action is based on an alleged breach of a written contract, the terms must be set out verbatim in
the body of the complaint or a copy of the written instrument must be attached and incorporated by
reference.” The Otworth court did not offer any analysis to support that proposition. Instead, it simply cited
Wise v. Southern Pacific Co. (1963) 223 Cal.App.2d 50, 59 (Wise ) (overruled on other grounds in Applied
Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510, 521). The Wise court stated, “where a
written instrument is the foundation of a cause of action, it may be pleaded in haec verba by attaching a copy
as an exhibit and incorporating it by proper reference.” (Wise, at p. 59.) It is readily apparent that the
Otworth court read more into that statement than is actually there. The Wise court was simply stating one
available method of pleading the contract — it was not specifying the exclusive means of pleading a contract.
The correct rule is that “a plaintiff may plead the legal effect of the contract rather than its precise language.”
(Construction Protective Services, Inc. v. TIG Specialty Ins. Co. (2002) 29 Cal.4th 189, 199.) Because it is
apparent that the Otworth court misread Wise, and because, in any event, we are bound by our Supreme Court,
we decline to follow Otworth. Accordingly, plaintiff's failure either to attach or to set out verbatim the terms
of the contract was not fatal to his breach of contract cause of action.
Aside from these arguments, it appears that plaintiff alleged the basic elements of a breach of contract claim.
“A cause of action for breach of contract requires proof of the following elements: (1) existence of the
contract; (2) plaintiff's performance or excuse for nonperformance; (3) defendant's breach; and (4) damages
to plaintiff as a result of the breach.” (CDF Firefighters v. Maldonado (2008) 158 Cal.App.4th 1226, 1239.)
Plaintiff alleged an express contract to refinance his loan, including the loan balance, the interest rate, and the
monthly payment. He alleged he performed by making payments under the agreement. He alleged
defendants breached that contract by repudiating it and refusing to accept payments under it. And he alleged
he was damaged by various fees he was charged and by being evicted from his home. Accordingly, we reverse
the dismissal of plaintiff's breach of contract claim.
Defendants offer two arguments in support of the dismissal of the fraud and negligent misrepresentation
causes of action. First, they contend a misrepresentation cause of action does not lie where the
misrepresentation pertains to future events: “The reason for this requirement is obvious: it is not possible to
determine whether someone making a representation did so with knowledge, or reckless disregard, of the truth
of the alleged representation if the representation was not made at a time in which it was known to be true or
false. Therefore, the alleged promise to modify the Plaintiff's loan cannot form the basis of a fraud or
misrepresentation claim, because the Plaintiff cannot allege that the person making such a representation
knew it to be true or false, as it concerned a future event.” Defendants later concede, however, “The only
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3. circumstances under which a future promise may form the basis of a fraud claim is where the plaintiff can
allege facts that the promisor made a promise with no intent of performing.” Indeed, the nature of
promissory fraud is that it is a promise of future performance with no present intent to actually perform.
(Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.) And this is precisely what plaintiff alleges: “42.
Defendants induced Plaintiff into entering into making payments of more than $44,000.00 on the promise of
providing Plaintiff with a reasonable modification of the loan on the Property. [¶] 43. At the time that
Defendants made these representations, they knew them to be false as Defendants had no intention of
honoring their promise to provide Plaintiff with a permanent loan modification but instead, intended to strip
the Plaintiff of all of his liquid assets and then proceed with foreclosure on Plaintiff's Property.” Accordingly,
the misrepresentation causes of action are not demurrable on the ground they involved a future event.
Defendants' second argument is that the misrepresentation allegations lack specificity. Defendants rely on
the rule that in alleging fraud against a corporation, the plaintiff must “ ‘allege the names of the persons who
made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or
wrote, and when it was said or written.’ ” (Lazar v. Superior Court, supra, 12 Cal.4th at p. 645.) “We observe,
however, certain exceptions which mitigate the rigor of the rule requiring specific pleading of fraud. Less
specificity is required when ‘it appears from the nature of the allegations that the defendant must necessarily
possess full information concerning the facts of the controversy,’ [citation]; ‘[e]ven under the strict rules of
common law pleading, one of the canons was that less particularity is required when the facts lie more in the
knowledge of the opposite party․’ [Citation.] [¶] Additionally, ․ considerations of practicality enter in.”
(Committee On Children's Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 217 (superseded by
statute on other grounds in Branick v. Downey Savings & Loan Assn. (2006) 39 Cal.4th 235, 242).)
Plaintiff alleges defendants induced him to make over $44,000 in payments based on the false promise that
they would provide a reasonable modification of the loan. The alleged facts in support are that HomEq
initially agreed to the March 2008 contract but then reneged on it and on various particular dates sent more
agreements and demanded more fees. The primary omission in the allegations is that plaintiff does not
identify the names of the people he spoke to nor their authority to speak. In our view, this omission falls
comfortably in the realm of information that lies more in the possession of defendants. (See Boschma v.
Home Loan Center, Inc. (2011) 198 Cal.App.4th 230, 248 [“ ‘While the precise identities of the employees
responsible ․ are not specified in the loan instrument, defendants possess the superior knowledge of who was
responsible for crafting these loan documents' ”].) Defendants admitted in the summary judgment motion,
for example, that they possessed a comment log of the phone calls plaintiff had made to HomEq. Such
evidence is easily foreseeable at the demurrer stage. Further, as revealed by attachments to the complaint,
some of the communications from HomEq were in the form of letters that were simply signed by “HomEq
Servicing.” Finally, in an era of electronic signing, it is often unrealistic to expect plaintiffs to know the
who-and-the-what authority when mortgage servicers themselves may not actually know the who-and-
the-what authority. Accordingly, we do not consider that omission fatal. Thus we will reverse the dismissal
of the misrepresentation causes of action.
II.
The Summary Judgment MotionFACTS
On July 1, 2005, plaintiff obtained a mortgage loan and executed a promissory note and deed of trust in the
amount of $815,000. The promissory note called for monthly interest only payments in the amount of
$4,068.21 from September 2005 to August 2007. “Thereafter, Plaintiff was obligated to pay principal and
interest payments through the maturity of the loan.” That loan was ultimately assigned to defendant
Deutsche Bank National Trust Company and serviced by HomEq.
In 2005 and 2006 plaintiff failed to pay his property taxes, so HomEq advanced the funds for plaintiff and
demanded repayment. In April 2007 there remained an escrow shortage of $31,081. HomEq informed
plaintiff that he needed to bring it current and that if he did not, his monthly payment would be increased to
$5,937.64 to cover the shortfall. Plaintiff agreed to the increased monthly payment, which he made in May,
June, July, August, and September of 2007. In September 2007, plaintiff submitted an application for a loan
modification. Plaintiff did not make payments in October or November 2007 (plaintiff claims this was at
HomEq's advice to help the modification process; HomEq denies this). He made a payment in December
2007 and January 2008 of $5,293.99 (the reason for the approximately $540 shortfall is disputed). In
February 2008 the proposed loan modification was ready for review. Plaintiff claims, however, that HomEq
refused to send the agreement unless he paid a one-time processing fee of $12,075.09. It is undisputed that
he paid that amount in February 2008, but defendants dispute that they required the money as a processing
fee or otherwise refused to send the agreement.
HomEq sent plaintiff a loan modification agreement dated March 7, 2008. Under the terms of that
agreement, plaintiff was to make a $3,500 down payment concurrent with signing the agreement; $45,773.89
was to be added to the principal balance of the loan to reflect past due interest, late fees and the monies
HomEq had paid for plaintiff's delinquent property taxes. Plaintiff was given a credit of $20,884.08 to reflect
recent payments, however, resulting in a net increase in the loan balance of $24,889.81. The resulting
balance was $839,889.81. The interest rate was reduced from an adjustable 7.49 percent to a fixed 5.99
percent. However, the rate was only fixed for five years and the agreement did not specify how the rate would
be calculated thereafter. Plaintiff's new monthly payment was $6,272.78. Once he received the agreement,
plaintiff called HomEq to inquire how the interest rate would be calculated after the five years. HomEq
advised plaintiff that the interest rate would be fixed at 5.99 percent for the life of the loan, and also informed
plaintiff that the version he received had errors and needed to be revised. Before receiving the revised
agreement, plaintiff made a payment of $6,272.78 pursuant to the terms of the March 7 agreement.
Plaintiff subsequently received a revised agreement dated March 13, 2008. The revised agreement actually
slightly reduced the loan balance to $834,051.86 and the monthly payment to $6,236.78. It also confirmed
that the interest rate would be fixed at 5.99 percent for the life of the loan. Plaintiff signed the March 13
agreement and returned it to HomEq. HomEq received it, forwarded it to management for review, and the
agreement was subsequently signed by Blanca Vargas, HomEq Vice-president.
On April 15, 2008, four days after HomEq received, approved and signed the March 13 agreement, HomEq
sent plaintiff a default letter demanding that he pay $39,997.18 or face immediate foreclosure. One week
later, HomEq accepted plaintiff's payment of $6,236.78. On April 30, just a little over one week later, HomEq
sent another loan modification agreement, this time raising the loan balance to $870,000. HomEq told
plaintiff he had to sign the latest loan modification agreement or face foreclosure. Plaintiff claims that,
thereafter, HomEq refused any payments under the March 13 agreement. HomEq denies that it refused
payments. In any event, it appears no regular payments were made in May 2008. It appears that HomEq
believed the balance had been miscalculated on the March 13 agreement and thus refused to honor it (even
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4. though management had reviewed it and a vice-president had signed it).
Around June 11, 2008, HomEq sent another revised proposed loan modification agreement. The revised
agreement would have raised the loan balance to $895,000. On June 19, 2008, plaintiff made another
payment of $6,236, consistent with the March 13 agreement.
On June 24, 2008, HomEq sent plaintiff an account statement demanding a payment of $80,034.46 to bring
the account current. On July 24, 2008, HomEq sent a letter to plaintiff stating that an unspecified recent
payment was insufficient. At around the same time, HomEq sent another statement, but this one showed the
principal balance on the loan dropping by $3,253.47 and the past due amount dropping by $23,021.52 and the
escrow balance dropping by $7,477.76. This represented a total reduction in the amount owed of
$33,752.75. Plaintiff does not believe he paid this money and does not know how it was calculated.
The next day, a notice of default and election to sell was sent to plaintiff, listing the amount in default as
$52,558.03 — a different amount than had been listed on the statement.
In a letter dated October 10, 2008 (the record does not reveal what transpired between July and October),
HomEq offered to provide plaintiff with “workout” options. On October 29, 2008, plaintiff received a notice
of trustee's sale setting the sale date as November 20, 2008. As a result of the looming sale, on November 5,
2008, plaintiff submitted another loan modification application. On November 10, 2008, HomEq sent
plaintiff a letter advising him he had been approved for a “Repayment Plan.” The letter did not state what the
terms of the repayment plan would be. Instead, the letter stated that the terms of the plan would be mailed
separately and that plaintiff needed to make a payment of $14,050 within three days. On November 11, 2008,
plaintiff (or possibly his attorney) contacted HomEq to see the terms of the repayment plan but was told he
could not see it until he paid the $14,050. Plaintiff did so. On November 28, 2008, HomEq sent plaintiff a
“forebearance agreement” that would have required him to make payments of $13,475.74 per month for four
months and then another lump sum payment of $63,176.07 at the end of that period. Unable to afford those
payments, and still believing the March 13 agreement to be valid, plaintiff refused to sign the forebearance
agreement.
Around December 4, 2008, plaintiff received a letter from HomEq offering another home loan modification
predicated on plaintiff making another down payment of $1,450.4 On January 12, 2009, HomEq sent plaintiff
a letter stating he was in default under the forebearance agreement (though there is no indication in the record
that plaintiff ever signed that agreement). On February 17, 2009, HomEq sent plaintiff another letter offering
to send plaintiff another modification if he made a payment of $29,771. On March 17, 2009, plaintiff received
a “Payoff Statement indicating that the total amount due on the loan was $885,110.02.” The next day he
received another “Payoff Statement,” this time indicating the total amount of the loan was $891.032.31.
The following day, March 19, 2009, the Riverside Superior Court issued a temporary restraining order blocking
the sale of plaintiff's home. It is disputed whether defendants received notice of the order. On March 23,
2008, defendants sold plaintiff's home and subsequently evicted him.
PROCEDURAL HISTORY
After the court sustained the demurrer, defendants moved for summary judgment on the only remaining cause
of action, wrongful foreclosure. The court granted the motion, reasoning, “Damages in a wrongful foreclosure
action are based on the fair market value of the property at the time it was sold, minus any mortgages and liens
against the property. [Citation.] Defendant provided evidence that Plaintiff owed $891,375.18 when the
property was sold, and evidence that the property was worth less than $815,000 when it was sold.” “Although
Plaintiff argued that he should be entitled to include lost rental income, monies spent on improvements[,]
attorneys' fees and emotional distress damages when calculating damages, the Court finds no case supporting
this specific method of calculating damages when only wrongful foreclosure is alleged. To the contrary, each
item identified would necessarily be reflected in the value of the property.” The court also noted there was no
evidence that defendants were served with the temporary restraining order prior to the sale of the property.
DISCUSSION
The court granted summary judgment on the wrongful foreclosure cause of action on the sole ground that
plaintiff could not prove damages. The court believed the only permissible damages in a wrongful foreclosure
suit is the lost equity in the home, and where there is no equity, no cause of action will lie. We disagree.
There are surprisingly few California cases describing the nature of a wrongful foreclosure cause of action.
The most thorough treatment is found in Munger v. Moore (1970) 11 Cal.App.3d 1 (Munger ), the case both the
court and defendants relied upon. The facts of that case are somewhat complicated, but to simplify to only
the relevant facts, the plaintiff defaulted on a loan secured by real property. (Id. at p. 5.) Prior to any
foreclosure sale, the plaintiff timely tendered the amount in default under the loan. (Id. at pp. 5–6.) The
defendants (the lenders) refused the tender and foreclosed on the property. (Id. at p. 6.) They were ultimately
able to sell the property for an amount that exceeded all encumbrances on the property by $30,000. At trial,
the court awarded that amount to the plaintiff in damages. (Id. at pp. 11–12.)
Affirming, the court of appeal articulated the nature of a wrongful foreclosure action and the proper measure
of damages as follows: “[A] trustee or mortgagee may be liable to the trustor or mortgagor for damages
sustained where there has been an illegal, fraudulent or willfully oppressive sale of property under a power of
sale contained in a mortgage or deed of trust. [Citations.] This rule of liability is also applicable in
California, we believe, upon the basic principle of tort liability declared in the Civil Code that every person is
bound by law not to injure the person or property of another or infringe on any of his rights.” (Munger, supra,
11 Cal.App.3d at p. 7, fn. omitted.)
We agree with this basic analysis of a tort of wrongful foreclosure. A tort of wrongful foreclosure satisfies the
basic factors for finding a tort duty enunciated in Biakanja v. Irving (1958) 49 Cal.2d 647, 650–651. The
transaction is intended to affect the plaintiff — it is intended to dispossess the plaintiff; it is easily foreseeable
that doing so wrongfully will cause serious damage and disruption to the plaintiff's life; the injuries are
directly caused by the wrongful foreclosure; the moral blame of foreclosing on someone's home without right
supports finding a tort duty; and recognizing a duty will help prevent future harm by discouraging wrongful
foreclosures. (See Ibid.) Such a tort bears some analogy to a wrongful eviction tort, which is well recognized
and can exist in parallel with a breach of lease claim. (Nativi v. Deutsche Bank National Trust Co. (2014) 223
Cal.App.4th 261, 293 [“California recognizes the tort of wrongful eviction”]; Spinks v. Equity Residential
Briarwood Apartments (2009) 171 Cal.App.4th 1004, 1033, 1039 [permitting both a breach of lease and
tortious wrongful eviction to proceed].)
The basic elements of a tort cause of action for wrongful foreclosure track the elements of an equitable cause of
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5. action to set aside a foreclosure sale. They are: “(1) the 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 indebtedness or was excused from tendering.” (Lona v. Citibank, N.A. (2011) 202 Cal.App.4th 89,
104.) Federal District courts interpreting this cause of action have frequently cited the Nevada rule
articulated in Collins v. Union Federal Sav. & Loan Ass'n (Nev.1983) 662 P.2d 610, 623 that “[a]n action for the
tort of wrongful foreclosure will lie if the trustor or mortgagor can establish that at the time the power of sale
was exercised or the foreclosure occurred, no breach of condition or failure of performance existed on the
mortgagor's or trustor's part which would have authorized the foreclosure or exercise of the power of sale.”
(See, e.g., Das v. WMC Mortgage Corp. (N.D.Cal., Oct. 29, 2010, C10–0650 PVT) 2010 U.S.Dist. Lexis
122042; Roque v. Suntrust Mortgage, Inc. (N.D.Cal., Feb. 10, 2010, C–09–00040 RMW) 2010 U.S. Dist. Lexis
11546.) In other words, mere 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. This is a sound addition.
After describing the cause of action as a tort, the Munger court proceeded to describe the measure of damages
as follows: “Civil Code section 3333 provides that the measure of damages for a wrong other than breach of
contract will be an amount sufficient to compensate the plaintiff for all detriment, foreseeable or otherwise,
proximately occasioned by the defendant's wrong. In applying this measure it must be noted that the primary
object of an award of damages in a civil action, and the fundamental theory or principle on which it is based[,]
is just compensation or indemnity for the loss or injury sustained by the plaintiff and no more. [Citation.]
Accordingly, where a mortgagee or trustee makes an unauthorized sale under a power of sale he and his
principal are liable to the mortgagor for the value of the property at the time of the sale in excess of the
mortgages and liens against said property.” (Munger, supra, 11 Cal.App.3d 1, 11.)
Both the trial court and defendants interpreted Munger narrowly, with defendants going so far as to say that
“[t]he rule in Munger is an application of the benefit of the bargain rule.” It would be strange, however, to
apply a contract measure of damages to a tort. We read Munger more broadly. It announced the rule that
wrongful foreclosure is a tort (Munger, supra, 11 Cal.App.3d at p. 7), and the measure of damages is the
familiar measure of tort damages: all proximately caused damages. In Munger, the only damages at issue
were the lost equity in the property, and certainly that is a recoverable item of damages (id. at p. 11). It is not,
however, the only recoverable item of damages. Wrongfully foreclosing on someone's home is likely to cause
other sorts of damages, such as moving expenses, lost rental income (which plaintiff claims here, and damage
to credit. It may also result in emotional distress (which plaintiff also claims here). As is the case in a
wrongful eviction cause of action, “ ‘The recovery includes all consequential damages occasioned by the
wrongful eviction (personal injury, including infliction of emotional distress, and property damage) ․ and upon
a proper showing ․, punitive damages.’ ” (Spinks v. Equity Residential Briarwood Apartments (2009) 171
Cal.App.4th 1004, 1039.) 5
The rule applied by the trial court and urged by defendants would create a significant moral hazard in that
lenders could foreclose on underwater homes with impunity, even if the debtor was current on all debt
obligations and there was no legal justification for the foreclosure whatsoever. So long as there was no equity,
there would be no remedy for wrongful foreclosure. And since lenders can avoid the court system entirely
through nonjudicial foreclosures, there would be no court oversight whatsoever. Surely that cannot be the
law. The consequences of wrongfully evicting someone from their home are too severe to be left unchecked.
For the reasons expressed above, a tort action lies for wrongful foreclosure, and all proximately caused
damages may be recovered. Accordingly, the summary judgment is reversed.6
DISPOSITION
The judgment is reversed. Plaintiff shall recover his costs incurred on appeal.
FOOTNOTES
1. Although not alleged, we learn through the summary judgment motion that both parties signed the
agreement.
2. Deutsche Bank National Trust Company was sued as trustee under a pooling and servicing agreement
dated as of January 1, 2006, Morgan Stanley ABS Capital 1 Trust 2006 NC1. HomEq Servicing is in fact
Barclays Capital Real Estate, Inc. doing business as HomEq Servicing, erroneously sued as simply HomEq
Servicing.
3. The court also sustained the demurrer to plaintiff's cause of action entitled “One Action Violation,” which
he is not pursuing on appeal.
4. Plaintiff states the amount as $1,450; defendants state it as $14,050.
5. Importantly, we are not suggesting any of these damages are actually recoverable in this case. It may be
that plaintiff's damages, if any, are entirely offset by the benefit of being free of an underwater loan. That
issue has not been addressed by the parties, however, and we express no opinion one way or the other.
6. After the events giving rise to this lawsuit, the legislature enacted a statutory cause of action to recover
damages against a lender or loan servicer who forecloses on a home where there has been a loan modification
and there is no default on the loan modification. (Civ.Code, §§ 2924.12, subd. (b), 2923.6, subd. (c)(3).)
The applicability of this section has not been raised in the appeal, and we offer no opinion on how it would
impact, if at all, a common law tort action for wrongful foreclosure.
IKOLA, J.
WE CONCUR:ARONSON, ACTING P.J.FYBEL, J.
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