Keshtgar v. U.S. Bank
172 Cal. Rptr. 3d 818
Cal. Ct. App.2014Background
- Keshtgar executed a $910,000 note in May 2005 secured by a deed of trust on real property; MERS acted as beneficiary nominee; deed recorded June 10, 2005 with Resource Lenders as lender and Cuesta Title as trustee.
- On October 19, 2011 the deed of trust was assigned to U.S. Bank National Association as trustee for Harborview Mortgage Loan Trust; assignment recorded November 4, 2011; Rowe (MERS assistant secretary) signed the assignment.
- Keshtgar alleges Rowe was not authorized; alleges no valid receipt of assignment by U.S. Bank; alleges PSA/REMIC structure governs the trust assets and that transfer violated PSA timing.
- Keshtgar seeks a declaration voiding the assignment ab initio, prohibiting foreclosure, and quieting title in Keshtgar.
- Trial court sustained the bank’s demurrer without leave to amend; this court reviews de novo and affirms if no reasonable cure exists; the action aims to delay foreclosure and is barred by the nonjudicial foreclosure framework.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Preforeclosure challenge to foreclosing party authority | Keshtgar alleges lack of authority by assignee. | No preforeclosure judicial review to challenge foreclosing party authority under nonjudicial scheme. | Keshtgar lacks standing; no preforeclosure action to challenge authority. |
| Standing to challenge assignment in a preforeclosure context | Assignment from MERS to U.S. Bank unsupported; prejudice alleged is present. | No standing absent prejudice; assignment validity not required before foreclosure. | No standing to challenge assignment in preforeclosure, absent prejudice. |
| Effect of pooling/REMIC structure on transfer validity | Noncompliance with PSA renders transfer void as matter of law. | PSA/REMIC mechanics do not create preforeclosure challenge to authority. | No preforeclosure remedy based on PSA/REMIC noncompliance. |
| Gomes/Glaski line of cases and their applicability | Glaski supports standing to challenge transfer to trust. | Gomes bars preemptive challenges; Glaski not controlling in preforeclosure context. | Gomes controls; no preforeclosure action to challenge authority. |
Key Cases Cited
- Gomes v. Countrywide Home Loans, Inc., 192 Cal.App.4th 1149 (Cal. Ct. App. 2011) (nonjudicial scheme precludes preemptive challenge to foreclosure authority)
- Jenkins v. JP Morgan Chase Bank, N.A., 216 Cal.App.4th 497 (Cal. Ct. App. 2013) (no preforeclosure standing to challenge trustees’ authority)
- Glaski v. Bank of America, N.A., 218 Cal.App.4th 1079 (Cal. Ct. App. 2013) (post-foreclosure damages action; distinguishes Gomes for standing to challenge transfer in certain contexts)
- Siliga v. Mortgage Electronic Registration Systems, Inc., 219 Cal.App.4th 75 (Cal. Ct. App. 2013) (lacks standing absent prejudice from alleged lack of authority)
- Herrera v. Federal National Mortgage Assn., 205 Cal.App.4th 1495 (Cal. Ct. App. 2012) (standing to challenge assignment requires prejudice)
- Fontenot v. Wells Fargo Bank, N.A., 198 Cal.App.4th 261 (Cal. Ct. App. 2011) (prejudicial standing requirement in assignment challenges)
- Barroso v. Owen Loan Servicing, LLC, 208 Cal.App.4th 1001 (Cal. Ct. App. 2012) (post-foreclosure action; different procedural posture)
- Intengan v. BAC Home Loans Servicing, LP, 214 Cal.App.4th 1047 (Cal. Ct. App. 2013) (demurrer standard; de novo review of issues)