Judge Robert B. Broadbelt, Case Number: 21STCV27393, Date: 2023-11-15 Tentative Ruling

Judge: Robert B. Broadbelt, Case: 21STCV27393, Date: 2023-11-15 Tentative Ruling

Tentative rulings are sometimes, but not always, posted. The purpose of posting a tentative ruling is to to help focus the argument. The posting of a tentative ruling is not an invitation for the filing of additional papers shortly before the hearing.

RESPONDING PARTY: Plaintiff Rosa Maria Samples, as trustee of the Maria A. Gonzalez Living Trust and as executrix of the Last Will and Testament of Maria A. Gonzalez

The court considered the moving, opposition, and reply papers filed in connection with this motion.

The court overrules defendant Northern California Mortgage Fund XIV’s evidentiary objections to the First Amended Complaint, filed on November 13, 2023, because they were not filed within the time required by Code of Civil Procedure section 437c. (Code Civ. Proc., § 437c, subd. (a)(4) [“A reply to the opposition shall be served and filed by the moving party not less than five days preceding the noticed or continued date of hearing”]; Cal. Rules of Ct., rule 3.1354, subd. (a) [“all written objections to evidence in support of or in opposition to a motion for summary judgment or summary adjudication must be served and filed at the same time as the objecting party’s opposition or reply papers are served and filed”].) Further, defendant Northern California Mortgage Fund XIV has not cited to any authority allowing it to file evidentiary objections to the complaint in this action, which the court has not considered as evidence but is relevant in that it “delimit[s] the scope of the issues” and “frame[s] the outer measure of materiality in a summary judgment proceeding.” (Hutton v. Fidelity National Title Co. (2013) 213 Cal.App.4th 486, 493 [internal quotations omitted].)

The court grants defendant Northern California Mortgage Fund XIV’s request for judicial notice as to Exhibits Q, R, S, T, D, G, K, and U. (Evid. Code, § 452, subd. (c); Yvanova v. New Century Mortgage Corp. (2016) 62 Cal.4th 919, 924 , n. 1 [judicial notice was properly taken of recorded deed of trust, assignment of deed of trust, substitution of trustee, notices of default, and trustee’s deed upon sale].) The court notes, however, that “although the existence of a document, such as a document recorded in the official records of a government body, may be judicially noticeable, the truth of statements contained in the document and their proper interpretation are not subject to judicial notice.” (Tenet Healthsystem Desert, Inc. v. Blue Cross of California (2016) 245 Cal.App.4th 821, 836 [emphasis in original].)

The court grants defendant Northern California Mortgage Fund XIV’s request for judicial notice as to Exhibits V, W, and X. (Evid. Code, § 452, subd. (d).)

The purpose of a motion for summary judgment or summary adjudication “is to provide courts with a mechanism to cut through the parties’ pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) “Code of Civil Procedure section 437c, subdivision (c), requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.)

“On a motion for summary judgment, the initial burden is always on the moving party to make a prima facie showing that there are no triable issues of material fact.” (Scalf v. D.B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1519.) A defendant or cross-defendant moving for summary judgment or summary adjudication “has met his or her burden of showing that a cause of action has no merit if the party has shown that one or more elements of the cause of action . . . cannot be established, or that there is a complete defense to the cause of action.” (Code Civ. Proc., § 437c, subd. (p)(2).) “Once the defendant or cross-defendant has met that burden, the burden shifts to the plaintiff or cross-complainant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” (Code Civ. Proc., § 437c, subd. (p)(2).) “If the plaintiff cannot do so, summary judgment should be granted.” (Avivi v. Centro Medico Urgente Medical Center (2008) 159 Cal.App.4th 463, 467.) “When deciding whether to grant summary judgment, the court must consider all of the evidence set forth in the papers (except evidence to which the court has sustained an objection), as well as all reasonable inferences that may be drawn from that evidence, in the light most favorable to the party opposing summary judgment.” (Id. at p. 467; Code Civ. Proc., § 437c, subd. (c).)

Defendant Northern California Mortgage Fund XIV (“Defendant”) moves the court for an order granting summary judgment in its favor and against plaintiff Rosa Maria Samples, as trustee of the Maria A. Gonzalez Living Trust and as executrix of the Last Will and Testament of Maria A. Gonzalez (“Plaintiff”) on her First Amended Complaint or, alternatively, summary adjudication as to the sixth and seventh causes of action.[1]

“To prevail on a claim to cancel an instrument, a plaintiff must prove (1) the instrument is void or voidable due to, for example, fraud; and (2) there is a reasonable apprehension of serious injury including pecuniary loss or the prejudicial alteration of one’s position.” (Thompson v. Ioane (2017) 11 Cal.App.5th 1180, 1193-1994 [internal quotations omitted].)

The court finds that Defendant has met its burden of showing that the sixth cause of action for cancellation of instruments has no merit because Defendant has shown that an element of the cause of action (that the underlying instruments are void or voidable) cannot be established.

Plaintiff has alleged that the Notice of Default, and any other documents that rely thereon, should be cancelled because (1) the Notice of Default “is void/voidable based on an improperly calculated demand[,]” and (2) the Notice of Trustee’s Sale “is void because the amount claimed to be owing . . . is improperly and unlawfully calculated and demanded by the trustee.” (FAC ¶¶ 71-73.) In support of its motion, Defendant has submitted Plaintiff’s discovery responses to show that Plaintiff cannot support her factual claim that the amount demanded in the Notice of Default was improperly calculated, on which the sixth cause of action is based. (Union Bank v. Superior Court (1995) 31 Cal.App.4th 573, 581; Bayramoglu v. Nationstar Mortgage LLC (2020) 51 Cal.App.5th 726, 733 [“A plaintiff’s ‘factually devoid’ discovery responses may be used to shift the burden of production onto the plaintiff when the ‘logical inference’ is that the plaintiff possesses no facts to support his or her claims”].)

In response to an interrogatory requesting the identification of facts supporting the allegation that the demand amount was improperly calculated, Plaintiff stated that “Maria A[.] Gonzalez [(“Gonzalez”)] did not consent to this loan and had no meeting of the minds regarding this loan.” (Def. Compendium of Evidence (“Def. COE”), Sec. 2, Ex. O, COE p. 190:15-22 [Response to Special Interrogatory No. 8].) Similarly, Plaintiff stated that she was unable to “give an exact amount of amount due and owing” without receiving an accounting. (Id., p. 191:17-25 [response to Special Interrogatory No. 11].) Further, when asked to admit that the amount reflected on the Notice of Default was accurate as of the date that it was recorded, Plaintiff stated the following: “I don’t know. I nor my mother, [Gonzalez] received any statements from Northern California Mortgage. As of now, we have belief that it is not accurate.” (Def. COE Ex. P, COE p. 202:20-25 [response to Request for Admission No. 4].)

Thus, the court finds that Defendant has met its burden to show that this cause of action has no merit by submitting Plaintiff’s “factually devoid” discovery responses, which support a “logical inference” that Plaintiff possesses no facts to support her claim that the Notice of Default used an improperly calculated demand and, consequently, that Plaintiff cannot establish the element that the Notice of Default, Notice of Trustee’s Sale, and the documents reliant thereon are void or voidable. (Bayramoglu, supra, 51 Cal.App.5th at p. 733; Thompson, supra, 11 Cal.App.5th at pp. 1193-1994.)

The court finds that Plaintiff has not met her burden to show that a triable issue of material fact exists as to the element of the existence of a void or voidable instrument to be cancelled.

Plaintiff has argued, in her opposition papers, that (1) Gonzalez had no understanding of the subject loan; (2) Defendant owed Gonzalez a duty to vet and inquire of the loan made to her and acted negligently; and (3) the demand on the Notice of Default was improperly calculated. (Opp., p. 4:2-59.) However, Plaintiff has not presented any evidence in support of those assertions,[2] nor has Plaintiff presented argument contending that Defendant’s showing is insufficient to show that Plaintiff cannot establish the element of a void or voidable instrument.

The court also notes that Plaintiff appears to request leave to amend the First Amended Complaint to include a cause of action for identity theft under Civil Code section 1798.92, et seq. (Opp., p. 6:15-18.) However, Plaintiff does not explain how amending her complaint to include this cause of action (1) shows the existence of a triable issue of material fact as to the sixth cause of action for cancellation of instruments, or (2) would require the court to deny Defendant’s motion for summary adjudication as to the sixth and seventh causes of action.

Moreover, although Plaintiff asserts that her “counsel has diligently sought to meet and confer in order to add the cause of action for identity theft by a stipulation[,]” the court disagrees. (Opp., p. 6:16-17.) The only evidence submitted in support of this contention is a letter dated November 30, 2022, requesting that the parties stipulate to the addition of this cause of action. (Opp., Ex. A.) Plaintiff has not submitted any other evidence detailing her efforts to add this cause of action, and Plaintiff did not file a motion requesting leave to amend the complaint at any time after the November 30, 2022 letter was sent and before the November 15, 2023 hearing on this motion. Plaintiff has not explained her delay in seeking leave to amend.

Thus, the court finds that (1) Plaintiff unreasonably delayed in requesting this amendment, and (2) Defendant would be prejudiced by this amendment, and therefore denies Plaintiff’s request that the court grant leave to amend the complaint to add a cause of action for identity theft against Defendant. (Distefano v. Forester (2001) 85 Cal.App.4th 1249, 1264-1265 [“If the opposing party’s evidence would show some factual assertion, legal theory, defense or claim not yet pleaded, that party should seek leave to amend the pleadings before the hearing on the summary judgment motion”]; Green v. Rancho Santa Margarita Mortgage Co. (1994) 28 Cal.App.4th 686, 692 [“a long unexcused delay is sufficient to uphold a trial judge’s decision to deny the opportunity to amend pleadings, particularly where the new amendment would interject a new issue which requires further discovery”].)

The court therefore grants Defendant’s motion for summary adjudication as to the sixth cause of action for cancellation of instruments.

“To prevail on a quiet title claim, a plaintiff must establish title to the property in dispute.” (Thompson, supra, 11 Cal.App.5th at p. 1195; Code Civ. Proc., § 761.020.) Here, Plaintiff alleges that Defendant, as beneficiary and assignor, entered into a Deed of Trust with Gonzalez, as borrower, as a result of the undue influence, fraud, and elder abuse of certain individual defendants, and “seeks to quiet title as of March 2, 2017, the date on or about which [Gonzalez] executed the Deed of Trust for $300,000.” (FAC ¶¶ 76, 79-80.)

The court finds that Defendant has not met its burden of showing that the seventh cause of action for quiet title has no merit because Defendant has not shown that the element of Plaintiff’s right to title to the property cannot be established.

In its motion, Defendant argues that the loan and perfected Deed of Trust are valid because (1) Plaintiff has admitted that Gonzalez signed the loan documents, albeit allegedly as a result of undue influence on the part of individual defendants Sergio Alberto Herrera, Carlos Rafael Gonzalez, and Luz Velasquez, such that the loan and perfected Deed of Trust are valid; (2) even if Gonzalez was defrauded by third parties, such fraud would not have rendered the contract with Defendant voidable; (3) Defendant “did everything it was required to do as a lender[;]” and (4) the third party individuals alleged to have defrauded Gonzalez are not affiliated with Defendant. The court finds that these arguments are insufficient to show that Plaintiff cannot establish title to the subject property.

First, the court acknowledges that (1) Plaintiff’s discovery responses state that Gonzalez signed the Deed of Trust, and (2) Defendant has submitted the declaration of the licensed Notary Public that notarized the Deed of Trust for Gonzalez, whose notary journal states that she notarized the Deed of Trust for Gonzalez on March 7, 2017. (Def. COE Ex. O, COE p. 193:6-17 [response to Special Interrogatory No. 15 stating that “as of the date of signing the loan documents, Maria Gonzalez” had various characteristics and showed signs of dementia]; Kirsanova Decl., ¶ 4.) But Plaintiff’s discovery responses have also stated—as noted by Defendant—that Gonzalez obtained the subject loan as a result of the individual defendants’ forgery and/or undue influence over Gonzalez. (Ibid.; Def. COE Ex. O, COE pp. 183:6-184:13 [response to Special Interrogatory No. 2, stating that certain of the individual defendants “unduly influenced” Gonzalez to obtain another loan from Defendant, and further stating that those individuals also “forged her signature on [other unspecified] documents”].) Defendant has not cited any legal authority establishing that, because Plaintiff has stated in her discovery responses that Gonzalez signed the documents, the underlying loan is valid as a matter of law, irrespective of her claims that she obtained the loan as a result of undue influence or other fraudulent acts.

Second, although Defendant contends that “being allegedly defrauded by an unaffiliated third-party does not render a contract with a different party voidable[,]” Defendant has not cited any authority to support that contention. Defendant relies on Civil Code sections 1566, 1567, and 1575, none of which appears to stand for that proposition. Instead, Civil Code sections 1566 and 1567 define, respectively, “consent, when voidable[,]” and “apparent consent, when not free.” (Civ. Code, §§ 1566, 1567.) Similarly, Civil Code section 1575 sets forth conduct that consists of undue influence. (Civ. Code, § 1575.) These provisions do not support Defendant’s assertions that (1) a contract executed by a person without consent is not voidable as against a different party, or (2) a contract executed by a person as a result of undue influence is not voidable.

Third, Defendant states that it did everything that was required of it as a lender by, inter alia, sending disclosures to the borrower, notarizing documents through an approved notary, obtaining identity verification documents, and thereafter funding the loan. But Defendant does not cite any authority establishing that, by taking these actions, the Deed of Trust and other related documents relating to the subject property are not voidable as a result of the wrongdoing on the part of the individual defendants.

Fourth, Defendant has presented evidence showing that, aside from the fact that individual defendant Sergio Herrera brought the loan to FJM Capital, Inc., Defendant has not “had any relationship whatsoever with Sergio Herrera, Carlos Gonzalez, or Luz Velasquez.” (Bardis Decl., ¶ 16.) However, Defendant has not cited any authority establishing that, because it was not involved with the alleged scheme to defraud Gonzalez, the loan and the Deed of Trust are valid. The court notes that, in a cause of action for quiet title, there does not need to be any allegation or evidence of wrongdoing on the part of a defendant. Instead, all that is required is that there exist “adverse claims to the title of the plaintiff against which a determination is sought.” (Code Civ. Proc., §761.020, subd. (c); Water for Citizens of Weed California v. Churchwell White LLP (2023) 88 Cal.App.5th 270, 281 [“The purpose of a quiet title action is to establish title against any adverse claims to property or any interest therein”].) Thus, the involvement or noninvolvement of Defendant in the alleged wrongdoing is immaterial, as the purpose of a quiet title cause of action is to determine—irrespective of whether the entity claiming an adverse interest is alleged to have committed wrongful acts or omissions—whether the plaintiff establishes title to the property in dispute.

Finally, the court acknowledges that “[w]here a complaint seeks to quiet title to real property and cancel an instrument and both claims are based on the same facts, it is said that the cancellation claim is incidental to the claim to quiet title such that the action asserts only one claim.” (Deutsche Bank National Trust Co. v. Pyle (2017) 13 Cal.App.5th 513, 523 [emphasis added].) Here, Plaintiff’s causes of action for cancellation of instruments and quiet title are based on different facts. Specifically, the cancellation of instruments cause of action is based on the allegations that the Notice of Default and consequently, the Notice of Trustee’s Sale are void or voidable because the amount claimed to be due was based on an improperly calculated demand. (FAC ¶¶ 22, 71-72.) In contrast, the quiet title cause of action is based, at least in part, on the allegation that Plaintiff signed the Deed of Trust in favor of Defendant “as a result of the elder abuse, fraud, and undue influence” of the individual defendants, such that Defendant’s claim is “without right” and Defendant has “no right, title, estate, lien or interest in” the subject property. (FAC ¶ 76.) Thus, the court finds that Plaintiff’s cause of action for cancellation of instruments is not “incidental” to this cause of action and therefore the court may both grant summary adjudication in favor of Defendant on the cancellation of instruments cause of action and deny summary adjudication as to the quiet title cause of action. (Pyle, supra, 13 Cal.App.5th at p. 523.)

Thus, the court finds that Defendant has not met its burden to show that Plaintiff cannot establish the element of Plaintiff’s title to the subject property. (Thompson, supra, 11 Cal.App.5th at p. 1195; Code Civ. Proc., § 761.020.)

The court therefore denies Defendant’s motion for summary adjudication as to the seventh cause of action for quiet title.

The court denies defendant Northern California Mortgage Fund XIV’s motion for summary judgment.

The court grants defendant Northern California Mortgage Fund XIV’s motion for summary adjudication as to plaintiff Rosa Maria Samples, as trustee of the Maria A. Gonzalez Living Trust and as executrix of the Last Will and Testament of Maria A. Gonzalez’s sixth cause of action for cancellation of instruments.

The court denies defendant Northern California Mortgage Fund XIV’s motion for summary adjudication as to plaintiff Rosa Maria Samples, as trustee of the Maria A. Gonzalez Living Trust and as executrix of the Last Will and Testament of Maria A. Gonzalez’s seventh cause of action for quiet title.

The court orders defendant Northern California Mortgage Fund XIV to give notice of this ruling.

[1] The court sustained Defendant’s demurrer to Plaintiff’s fourth and eighth causes of action without leave to amend on December 9, 2022.

[2] The court notes that, in disputing various facts set forth in the separate statement, Plaintiff has cited allegations in her First Amended Complaint. But “[i]t is generally understood . . . that a party cannot rely on the allegations of [her] own pleadings, even if verified, to make or supplement the evidentiary showing required in the summary judgment context.” (College Hospital, Inc. v. Superior Court (1994) 8 Cal.4th 704, 720, n. 7.) Thus, the court finds that the allegations in Plaintiff’s operative complaint cannot be used to show the existence of a triable issue of material fact as to this element.

rosa maria samples, as trustee of the Maria A. Gonzalez Living Trust and as executrix of the Last Will and Testament of Maria A. Gonzalez ; Plaintiffs, vs. northern california mortgage fund xiv, llc , et al.; Defendants.	Case No.:	21STCV27393

	Hearing Date:	November 15, 2023

	Time:	10:00 a.m.

	[Tentative] Order RE: defendant’s motion for summary judgment or, in the alternative, summary adjudication