Judge Curtis A. Kin, Case Number: 23STCP15619, Date: 2023-10-05 Tentative Ruling

Judge: Curtis A. Kin, Case: 23STCP15619, Date: 2023-10-05 Tentative Ruling

Case Number: 23STCP15619 Hearing Date: October 5, 2023 Dept: 82

ORDER TO SHOW CAUSE

RE: PRELIMINARY INJUNCTION

Date: 10/5/23 (1:30 PM)

Case: Dionne Wynn v. Selene Finance LP, et al. (23STCV15619)

TENTATIVE RULING:

Plaintiff Dionne Wynn’s request for a preliminary injunction is DENIED.

The request for judicial notice as to Exhibits 1-7 is GRANTED, pursuant to Evidence Code §§ 452(g) and (h), but only for the limited purposes set forth in Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 265. (Fontenot, 198 Cal.App.4th at 265 [“Taken together, the decisions discussed above establish that a court may take judicial notice of the fact of a document's recordation, the date the document was recorded and executed, the parties to the transaction reflected in a recorded document, and the document's legally operative language, assuming there is no genuine dispute regarding the document's authenticity”].”)

The request for judicial notice as to Exhibits 8-11 is GRANTED, pursuant to Evidence Code § 452(d).

As a preliminary matter, on September 12, 2023, the Court granted plaintiff’s ex parte application for a temporary restraining order and enjoined defendants Selene Finance LP (“Selene”); Wilmington Savings Fund Society, FSB dba Christiana Trust, Not Individually But As Trustee For Pretium Mortgage Acquisition Trust (“Wilmington”); and MTC Financial Inc. dba Trustee Corps from selling the property located at 3748 S Muirfield Rd, Los Angeles, CA 90016 (“Property”). (9/13/23 Order.) The Court ordered defendants to appear on October 5, 2023 and show cause why they should not be enjoined from conducting a trustee’s sale against the Property. (Ibid.)

The Court ordered plaintiff to serve moving and supplemental papers no later than September 15, 2023 with proof of service to be filed no later than September 21, 2023. (9/13/23 Minute Order.) The Court did not deem the ex parte application to be the moving papers. Plaintiff filed a “moving paper” on September 19, 2023 and served it on September 20, 2023. Notwithstanding the untimeliness of the moving paper, because defendants Selene and Wilmington (collectively, “defendants”) addressed the substantive merits of the moving paper in their opposition, the Court exercises its discretion and considers the moving paper. (Rule of Court 3.1300(d) [“No paper may be rejected for filing on the ground that it was untimely submitted for filing. If the court, in its discretion, refuses to consider a late filed paper, the minutes or order must so indicate”].)

With respect to evidence in support of the moving paper, plaintiff did not file any evidence after the issuance of the temporary restraining order. Plaintiff instead referenced the declaration filed in support of the ex parte application. As stated above, the Court did not deem the ex parte application to be the moving papers. Nevertheless, because defendants addressed plaintiff’s declaration filed in support of the ex parte application (Opp. at 12:14-19), the Court considers the declaration of plaintiff filed on September 12, 2023 in the interests of resolving the OSC on the merits.

“[T]he question whether a preliminary injunction should be granted involves two interrelated factors: (1) the likelihood that the plaintiff will prevail on the merits, and (2) the relative balance of harms that is likely to result from the granting or denial of interim injunctive relief.” (White v. Davis (2003) 30 Cal. 4th 528, 554.)

The Court first examines the likelihood that plaintiff will prevail on the merits.

With respect to the first cause of action for Violation of Civil Code § 2923.5, the statute “requires, before a notice of default may be filed, that a lender contact the borrower in person or by phone to ‘assess’ the borrower's financial situation and ‘explore’ options to prevent foreclosure.” (Mabry v. Superior Court (2010) 185 Cal.App.4th 208, 213-14.) Civil Code § 2923.5 also states: “A notice of default recorded pursuant to Section 2924 shall include a declaration that the mortgage servicer has contacted the borrower, has tried with due diligence to contact the borrower as required by this section, or that no contact was required because the individual did not meet the definition of ‘borrower’ pursuant to subdivision (c) of Section 2920.5.” (Civ. Code § 2923.5(b).)

A Notice of Default was recorded on March 8, 2023. (Wynn Decl. ¶ 12 & Ex. B; Fox Decl. ¶ 23 & RJN Ex. 6.) Plaintiff avers that no defendant, including servicer Selene, contacted her by telephone or in person to assess her finances or explore non-foreclosure options. (Wynn Decl. ¶ 14.) However, defendants present evidence that pursuant to plaintiff’s request, plaintiff was granted a loan modification in June 2021. (Fox Decl. ¶ 19 & RJN Ex. 4 [loan modification agreement notarized by plaintiff].) Accordingly, the Court finds plaintiff’s claim that Selene’s agents gave her the “run around” in connection with her attempts to apply for loan modifications is not credible. (See Wynn Decl. ¶ 11.)

Shortly after entering into the loan modification, beginning in August 2021, plaintiff defaulted on the modified loan. (Fox Decl. ¶ 20 & Ex. 19.) Selene’s records reflect that, between November 2021 and April 22, 2022 – at least 30 days prior to the recording of the Notice of Default (Civ. Code § 2923.5(a)(1)(A) – Selene made at least 15 attempts to contact plaintiff by telephone on different days of the week and different times of the day. (Fox Decl. ¶ 24.) Selene also mailed letters to plaintiff on January 13, 2022, and April 13, 2022, indicating that Selene has been attempting to reach plaintiff and including phone numbers to HUD-certified housing counseling agencies. (Fox Decl. ¶¶ 25-27 & Exs. 20, 21.) Defendants’ declaration demonstrates Selene’s compliance with the “due diligence” requirements set forth in Civil Code § 2923.5(e) at least 30 days before recording the Notice of Default on March 8, 2023.

Based on the foregoing evidence, plaintiff fails to show a likelihood of prevailing on the first cause of action for Violation of Civil Code § 2923.5.

With respect to the second cause of action for Violation of Civil Code § 2923.6(c)(1), this statute states: “If a borrower submits a complete application for a first lien loan modification offered by, or through, the borrower’s mortgage servicer at least five business days before a scheduled foreclosure sale, a mortgage servicer, mortgagee, trustee, beneficiary, or authorized agent shall not record a notice of default or notice of sale, or conduct a trustee’s sale, while the complete first lien loan modification application is pending. A mortgage servicer…shall not record a notice of default or notice of sale or conduct a trustee’s sale until any of the following occurs…

(3) The borrower accepts a written first lien loan modification, but defaults on, or otherwise breaches the borrower’s obligations under, the first lien loan modification.”

Plaintiff contends that Selene did not provide promised paperwork or in-person assistance to complete her loan modification application. (Wynn Dec. ¶¶ 7-10.) As discussed above, Selene presents evidence that plaintiff was granted a loan modification in June 2021 and that plaintiff defaulted on the modified loan shortly thereafter in August 2021. (Fox Decl. ¶ 19 & RJN Ex. 4; ¶ 20 & Ex. 19.) Insofar as plaintiff may have subsequently applied for another loan modification, plaintiff fails to show that “there has been a material change in the borrower’s financial circumstances since the date of the borrower’s previous application and that change is documented by the borrower and submitted to the mortgage servicer,” such that defendants were required to consider the subsequent application for loan modification before recording the Notice of Default on March 8, 2023 or the Notice of Trustee’s Sale on June 16, 2023. (Civ. Code § 2923.6(g); Fox Decl. ¶¶ 23, 28 & RJN Exs. 6, 7.)

Based on the foregoing evidence, plaintiff fails to show a likelihood of prevailing on the second cause of action for Violation of Civil Code § 2923.6(c)(1).

With respect to the third cause of action for Violation of Civil Code § 2923.7, this statute states: “When a borrower requests a foreclosure prevention alternative, the mortgage servicer shall promptly establish a single point of contact and provide to the borrower one or more direct means of communication with the single point of contact.” (Civ. Code § 2923.7(a).) Plaintiff contends that, because the due diligence requirements under Civil Code § 2923.5 were not satisfied, this evidences a failure to assign her a single point of contact. (Wynn Decl. ¶ 15.) However, defendants present evidence that, on January 13, 2022 and April 13, 2022, Selene sent letters informing plaintiff that Selene has been trying to reach her and providing her with the names of the single point of contact. (Fox Decl. ¶¶ 25-27 & Exs. 20, 21.) In view of this evidence, plaintiff fails to demonstrate a likelihood of prevailing on the third cause of action for Violation of Civil Code § 2923.7.

With respect to the fourth cause of action for Violation of Business & Professions Code § 17200, this cause of action is predicated on the first through third causes of action. (Compl. ¶¶ 93, 94.) Because plaintiff fails to demonstrate a likelihood of prevailing on the first through third causes of action, plaintiff fails to show any likelihood of prevailing on the fourth cause of action for Violation of Business & Professions Code § 17200.

Having failed to show a likelihood of prevailing on any cause of action, plaintiff’s request for a preliminary injunction is DENIED, notwithstanding any harm that may result from the denial of plaintiff’s request. (Jessen v. Keystone Savings & Loan Assn. (1983) 142 Cal.App.3d 454, 459 [“In a practical sense it is appropriate to deny an injunction where there is no showing of reasonable probability of success, even though the foreclosure will create irreparable harm, because there is no justification in delaying that harm where, although irreparable, it is also inevitable”].)

The temporary restraining order entered on September 13, 2023 is hereby DISSOLVED. The Court’s Order to Show Cause Re: Preliminary Injunction is DISCHARGED.