Judge: Craig Griffin, Case: Darwish vs. U.S. Bank National Associatio, Date: 2022-07-18 Tentative Ruling

The unopposed general demurrer by defendant Structured Adjustable Rate Mortgage Loan Trust, Mortgage Loan Trust, Mortgage Pass -Through Certificates, Series 2005-22, U.S. Bank National Association, as Trustee (“U.S. Bank”) to the complaint by plaintiffs Hussam Darwish (“Hussam”) and Danielle Darwish (“Danielle”) (together “plaintiffs”) is SUSTAINED with 20 days leave to amend.

RJN

U.S. Bank’s unopposed Request for Judicial Notice is GRANTED. The court takes judicial notice of each of the records, Exhibits 1- 6, but not of the truth of the matters stated therein. (Herrera v. Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366, 1375).

1st C/A – Viol. of HBOR

The first cause of action alleges defendants failed to comply with the requisite notices prior to recording a default (Civil Code §2923.5) and persisted in dual tracking of the loan modification review and non-judicial foreclosure proceedings (Civil Code §2923.6). (Complaint ¶32)

Civil Code §2923.5

The complaint alleges that at no time prior to recording the Notice of Default did U.S. Bank contact plaintiffs, in person or by telephone to notify them, follow up telephonically or advise plaintiffs of their right to a meeting. (Complaint ¶16)

The complaint further alleges that U.S. Bank was required to include in the Notice of Default a declaration that plaintiffs were contacted to assess their financial situation and to explore options to avoid

foreclosure or list efforts made to contact them, but Bank did not provide plaintiffs with the requisite notices or list any efforts that were made. Despite a statement of compliance, they were never contacted on March 25, 2015 to discuss any options to avoid foreclosure. (Complaint ¶17)

“[A] plaintiff must also allege that they suffered prejudice as a result of the defendant’s failure to provide the requisite notice.”. (Hart v. Select Portfolio Servicing, Inc. (C.D. Cal. 2015) 2015 WL8374926 at p. 1). Where the complaint fails to allege any prejudice and the plaintiff is on notice of the impending foreclosure sale, the §2923.5 claim fails as a matter of law. (Hart, supra, 2015 WL8374926 at p. 1)

As U.S. Bank contends, the complaint here does not allege any prejudice to the plaintiffs but admits that they are on notice of the impending foreclosure sale (Complaint ¶¶15, 20, 22).

Civil Code §2923.6

In order to plead a viable cause of action for violation of Civil Code §2923.6 the complaint must factually allege that the plaintiffs submitted a complete application for a first lien loan modification offered by, or through, the borrower's mortgage service. (Civil Code §2923.6 (c))

A loan modification application is deemed complete when the borrower has supplied the mortgage servicer with all documents required by the servicer within the reasonable timeframes specified by the mortgage servicer. (Civil Code §2923.6(h); Withers v. J.P. Morgan Chase Bank N.A. (N.D. Cal. 2014) 2014WL3418367 at p. 4). Alleging plaintiffs submitted all documents requested is a conclusory allegation which will not survive a motion to dismiss. (Haynish v. Bank of America (N.D. Cal. 2018) 284 F.Supp.3d 1037, 1048).

Here, the complaint alleges only that plaintiffs applied for forbearance relief with Trustee Corps which was the loan servicer. (Complaint ¶20) The complaint is devoid of any facts demonstrating the plaintiffs completed a loan modification application.

As the first cause of action fails to state sufficient facts to plead a violation of the HBOR, the demurrer to the first cause of action is SUSTAINED WITH 20 DAYS LEAVE TO AMEND.

2nd C/A Bus. & Prof. Code §17200

The second cause of action for violation of the California UCL is predicated on the viability of the HBOR claims. (Complaint ¶¶40, 43-46) In light of the ruling on the first cause of action, the demurrer to the second cause of action is likewise SUSTAINED WITH 20 DAYS LEAVE TO AMEND.

Moving party to give Notice of Ruling.