Judge: Craig Griffin, Case: "Grant v. Bank of America, N.A", Date: 2023-08-21 Tentative Ruling

Before the Court is an Order to Show Case re: Issuance of a Preliminary Injunction to prevent Defendants from selling the property until this matter is fully adjudicated. 

 

As a preliminary matter, Defendants’ Request for Judicial Notice is granted, as Plaintiffs’ opposition does not present viable grounds to deny judicial notice of court records.

 

As to the evidentiary objections to statements in the application, they are sustained to the extent the court will not consider them to be declarations of fact but will consider them as argument in support of the application. 

 

The court finds a Preliminary Injunction is not warranted in this instance.  The burden is on the moving party to show all elements necessary to support issuance of a preliminary injunction. (O’Connell v. Superior Court (2006) 141 Cal.App. 4th 1452, 1481.) The moving party has the burden to show that it is reasonably probable it will prevail on the merits. (San Francisco Newspaper Printing Co. v. Superior Court (1985) 170 Cal.App.3d 438, 442; Weil & Brown, ¶ 9:632.1.) Additionally, “[i]n deciding whether to issue a preliminary injunction, a trial court weighs two interrelated factors: [1] the likelihood the moving party ultimately will prevail on the merits, and [2] the relative interim harm to the parties from the issuance or noninsurance of the injunction.” (Whyte v. Schlage Lock Co. (2002) 101 Cal.App.4th 1443, 1449–1450.)

 

Here, Plaintiffs have not shown it is likely they will prevail on the merits at trial.  Plaintiffs’ claims are based almost entirely on a theory that Defendant Bank of America, N.A. (“BANA”) sold its interest in their mortgage note but remain the named beneficiary of the Deed of Trust.

 

But the law is clear that “a plaintiff may not seek to enjoin a foreclosure based on a claim that the foreclosing party lacked the necessary authority to foreclose.”  Lucioni v. Bank of America, N.A. (2016) 3 Cal.App.5th 150, 159 (Lucioni).  The “decision on whether to allow preforeclosure relief is essentially a policy one, pitting the interest in allowing borrowers injunctive protection against the delays that may occur in nonjudicial foreclosures due to litigation, even where the lenders are ultimately vindicated.”  Id. at p. 161; see also Perez v. Mortg. Elec. Registration Sys. 959 F.3d 334, 340 (9th Cir. 2020) and Staterbak v. JPMorgan Chase Bank, N.A. (2016) 245 Cal.App.4th 808, 814.)  Though Plaintiffs assert that such a claim can be maintained under New York law, there are no facts pled that support the application of New York law to the present case, particularly as the property at issue is located in Orange County, California. 

 

As to the fraud claims, while Plaintiffs assert that the fraudulent concealment and inducement involve Defendants’ alleged concealment of the securitization of their loan, they fail to articulate what damages that caused them or how they relied on any fraud, particularly as their indebtedness remains the same and they have been challenging BANA’s ability to foreclose since 2017. 

 

As for the IIED claim, Plaintiffs must show “(1) outrageous conduct by the defendant, (2) intention to cause, or reckless disregard of the probability of causing, emotional distress, (3) severe emotional suffering, and (4) actual and proximate causation of the emotional stress.” (Wong v. Jing (2010)189 Cal. App. 4th 1354, 1376.) It is unclear what the purportedly outrageous conduct is here, as Plaintiffs offer no basis under which BANA should have released the lien, nor can IIED claims be predicated upon purely economic activity. Plaintiffs assert that the concealment of the “transactional scheme” inflicted severe emotional distress but the allegations of the complaint make it clear that it is the attempt to foreclose that caused the alleged emotional distress.

 

As to the breach of contract claim, Plaintiffs repeatedly claim that Defendants breached the Deed of Trust, but their response does not elaborate on what breach occurred. Securitization of a loan does not relieve a borrower from his repayment obligations. (See Javaheri v. JPMorgan Chase Bank, N.A., 2012 U.S. dist. LEXIS 175743, at 18 (C.D. Cal. 2012; Lester v. J.P. Morgan Chase Bank, 2013 U.S. Dist. LEXIS 86420, at 19-21 (N.D. Cal. 2013).) Thus, there is no indication BANA was obligated to release their security interest in the property to Plaintiffs and Plaintiffs have not articulated such a basis in their papers.

 

As for the quiet title claim, Plaintiffs assert no tender is required as the Complaint asserts that there is no default.  They assert that the Deed of Trust is unenforceable. The reply asserts that the Complaint properly asserts the quiet title action, however Plaintiffs’ showing of a controversy is not sufficient to prove a likelihood of success on the merits of this cause of action. 

 

As for the injunctive and declaratory relief claims, they are necessarily tied to the substantive causes of action analyzed above.

While the interim harm to Plaintiffs here is undoubtedly greater than the interim harm to Defendants, as the likelihood of prevailing has not been established, the preliminary injunction is DENIED.

 

Moving party to give notice.