Scott v. JPMorgan Chase Bank
214 Cal. App. 4th 743
Cal. Ct. App.2013Background
- Scott obtained title to real property in 2005 and secured a construction loan later assigned to WaMu; WaMu’s assets were later acquired by JPMorgan under a FDIC purchase and assumption agreement.
- Under the P&A Agreement, JPMorgan did not assume WaMu’s borrower liabilities, only WaMu’s assets, as of September 25, 2008.
- Scott defaulted; California Reconveyance Company recorded a default and a trustee’s sale in 2009.
- Scott sued JPMorgan and others alleging various tort, contract, and fraud theories arising from loan origination and foreclosure practices.
- The trial court sustained JPMorgan’s demurrer to Scott’s second amended complaint without leave to amend, after judicial notice of the P&A Agreement and related documents.
- Appellate review affirmed the demurrer, holding JPMorgan had no borrower-liability under the P&A Agreement and that Scott failed to plead cognizable claims or tender.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether judicial notice of the P&A Agreement was proper | Scott contends notice of the contract and its legal effect was improper. | JPMorgan maintains proper judicial notice of official acts and legal effect of the P&A Agreement. | Judicial notice proper; documents’ legal effect not reasonably subject to dispute. |
| Whether Scott stated cognizable claims against JPMorgan post-P&A | Scott asserts JPMorgan is liable as successor and due to post-transfer conduct. | P&A Agreement excludes liabilities; JP Morgan not liable for WaMu borrower claims. | No cognizable claims against JPMorgan; demurrer proper. |
| Whether JPMorgan had standing to foreclose | Scott contends JPMorgan lacked beneficiary interest after FDIC transfer. | WaMu’s assets (including the beneficial interest) transferred to JPMorgan; JPMorgan had standing. | JPMorgan had the beneficial interest and standing to foreclose. |
| Whether tender was required for wrongful foreclosure/quiet title | Tender not required due to alleged fraud and equitable concerns. | Tender required to challenge foreclosure; no tender alleged. | Tender required; failure to tender supports demurrer. |
| Whether denial of leave to amend was proper | Scott could cure pleading defects with amendment based on discovery. | No concrete proposed amendments to cure deficiencies. | Court did not abuse discretion; no reasonable amendment shown. |
Key Cases Cited
- Fontenot v. Wells Fargo Bank, N.A., 198 Cal.App.4th 256 (2011) (judicial notice of legal effect of recorded documents permissible)
- Herrera v. Deutsche Bank National Trust Co., 196 Cal.App.4th 1366 (2011) (public records; not notice of truth of contents when disputed)
- Jolley v. Chase Home Finance, LLC, 213 Cal.App.4th 872 (2013) (judicial notice limits; full P&A content disputed)
- Joslin v. H.A.S. Ins. Brokerage, 184 Cal.App.3d 369 (1986) (deference to documents; admissibility of facts from documents)
- Mangini v. R.J. Reynolds Tobacco Co., 7 Cal.4th 1057 (1994) (limits of judicial notice for non-operational facts)
- StorMedia, Inc. v. Superior Court, 20 Cal.App.4th 449 (1999) (documents and presumed facts; evidentiary notice limits)
- Abdallah v. United Savings Bank, 43 Cal.App.4th 1101 (1996) (demurrer proper without tender in certain foreclosure claims)