Lucioni v. Bank of America, N.A.
3 Cal. App. 5th 150
| Cal. Ct. App. | 2016Background
- In 2005 Lucioni obtained a home loan secured by a deed of trust; the loan and deed of trust were later transferred among multiple parties, creating alleged breaks in the chain of title.
- On April 9, 2014, Raymond James Bank, N.A. (RJB) recorded a substitution of trustee (Sage Point) and a Notice of Default.
- Lucioni sued, seeking to enjoin the nonjudicial foreclosure under Civil Code § 2924(a)(6) (HBOR provision requiring that only an entity entitled to foreclose may initiate foreclosure) and asserting a breach-of-contract claim against Bank of America for a failed loan modification promise.
- Defendants demurred; the trial court sustained the demurrers without leave to amend and entered judgment for defendants.
- On appeal, the central question was whether the HBOR authorizes preforeclosure injunctive relief for violations of § 2924(a)(6), and whether Lucioni could amend to plead an HBOR claim that does permit injunctive relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether HBOR authorizes injunctive relief for alleged lack of authority to foreclose under § 2924(a)(6) | Lucioni: § 2924(a)(6) bars entities that lack the beneficial interest from initiating foreclosure, so he may seek a preforeclosure injunction. | Defendants: HBOR specifies only certain sections for preforeclosure injunctions; § 2924(a)(6) is not among them. | Court: HBOR injunctive relief is limited to the sections listed in §§ 2924.12(a)(1) and 2924.19(a)(1); § 2924(a)(6) is not listed, so preforeclosure injunction is not available under HBOR. |
| Whether § 2924.17/§ 2923.55 allow amendment to require foreclosing party to prove right to foreclose preforeclosure | Lucioni: § 2924.17/§ 2923.55 impose duties and require declarations that effectively force the foreclosing party to show its right to foreclose, which are injunctively enforceable (and listed in HBOR). | Defendants: Those provisions require certain declarations and internal review but do not create a preforeclosure right to litigate the validity of the foreclosing party’s beneficial interest. | Court: §§ 2924.17 and 2923.55 require filings and internal review but do not create a court-proved preforeclosure right to litigate entitlement to foreclose; amendment would not cure defect. |
| Whether breach-of-contract claim against Bank of America was timely | Lucioni: Performance receipts convert the oral trial-modification promise into a written contract (invoking longer statute of limitations). | Bank of America: The promise was oral; two-year limitations for oral contracts applies. | Court: The alleged agreement was oral and governed by the two-year limitations period; claim was time-barred and not curable by amendment. |
Key Cases Cited
- Yvanova v. New Century Mortgage Corp., 62 Cal.4th 919 (2016) (recognizes postforeclosure wrongful-foreclosure claims based on allegedly void assignments; does not resolve preforeclosure injunctive relief under HBOR)
- Schifando v. City of Los Angeles, 31 Cal.4th 1074 (2003) (standard for assuming truth of complaint allegations on demurrer)
- Miles v. Deutsche Bank Nat. Trust Co., 236 Cal.App.4th 394 (2015) (punitive damages may be available in appropriate wrongful-foreclosure cases)
- Sciarratta v. U.S. Bank Nat. Assn., 247 Cal.App.4th 552 (2016) (postforeclosure remedies and utility of HBOR disclosure rules to enable postforeclosure litigation)