Filed 4/13/17 Vanpelt v. HSBC Bank USA, Natnl Assn CA1/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION ONE


LINDA VANPELT,
Plaintiff and Appellant,
v.
HSBC BANK USA, NATIONAL ASSOCIATION, as Trustee, etc., et al.,
Defendants and Respondents.

A148643

(Solano County
Super. Ct. No. FCS046108)


Plaintiff Linda Vanpelt defaulted on her home mortgage, and nonjudicial foreclosure proceedings were initiated. Vanpelt brought this action against defendants HSBC Bank USA, National Association (HSBC) and Mortgage Electronic Registration Systems, Inc. (MERS), alleging causes of action for wrongful foreclosure and violation of Civil Code section 2924.17 (section 2924.17). After Vanpelt failed to oppose defendants’ demurrer to the complaint, the trial court sustained the demurrer and dismissed the case with prejudice. We affirm.
I.
FACTUAL AND PROCEDURAL
BACKGROUND
We begin by summarizing the complaint’s sparse factual allegations, which we accept as true in reviewing the trial court’s ruling on the demurrer. (Evans v. City of Berkeley (2006) 38 Cal.4th 1, 6.) Vanpelt obtained a loan secured by a promissory note and a deed of trust recorded in 2007 against her property in Vacaville. The deed of trust identified Reunion Mortgage Inc. as the beneficiary.
In January 2010, Wells Fargo Bank, N.A., purportedly acting as servicer of the promissory note, recorded a notice of default against Vanpelt’s property. In May 2011, MERS, purportedly acting as the beneficiary, assigned the deed of trust to HSBC. A notice of sale was recorded in September 2015, but the complaint does not allege that a sale has occurred.
Vanpelt, represented by counsel, filed the complaint in October 2015. It alleges a cause of action for wrongful foreclosure on the basis that the May 2011 assignment was void and defendants therefore lacked authority to initiate foreclosure proceedings. The complaint also alleges a cause of action for violation of section 2924.17, which requires various recorded foreclosure-related documents to be “accurate and complete and supported by competent and reliable evidence.” (§ 2924.17, subd. (a).)
In February 2016, defendants demurred to the complaint and filed a request for judicial notice of various foreclosure-related documents. Defendants served Vanpelt’s counsel with notice of the demurrer, a hearing on which was scheduled for April 12. Vanpelt did not file opposition to the demurrer. The day before the scheduled hearing, the trial court issued a tentative ruling sustaining the demurrer without leave to amend. Vanpelt did not contest the ruling, and it therefore became the court’s order.
In the order, the trial court found that the wrongful-foreclosure claim failed because Vanpelt had not alleged any defect in the assignment of the deed of trust to HSBC by MERS or any resulting prejudice. The court found that the section 2924.17 claim also failed because it rested on Vanpelt’s “unmeritorious theory of wrongful foreclosure” and was not supported by any allegations that defendants had failed to “review reliable and competent evidence prior to recording any documents in pursuit of nonjudicial foreclosure.” Finally, the court concluded that Vanpelt had not met her burden to show that she could cure the defects by amending the complaint. The court did not rule on defendants’ request for judicial notice.
The trial court’s order was served on Vanpelt’s counsel, who received it on April 14, 2016. The following month, Vanpelt’s counsel was served with a notice of entry of the order, and the trial court entered a judgment dismissing the case with prejudice. In June, a new attorney, Vanpelt’s appellate counsel, filed a notice of appeal. Vanpelt did not seek any relief in the trial court based on any inaction by her original counsel.
II.
DISCUSSION
A. Standards of Review.
We independently review a trial court’s order sustaining a demurrer. (Brown v. Deutsche Bank National Trust Co. (2016) 247 Cal.App.4th 275, 279 (Brown).) “In doing so, this court’s only task is to determine whether the complaint states a cause of action. [Citation.] We accept as true all well-pleaded allegations in the operative complaint, and we will reverse the trial court’s order of dismissal if the factual allegations state a cause of action on any available legal theory. [Citation.] We treat defendants’ demurrer as admitting all properly pleaded material facts, but not contentions, deductions, or conclusions of fact or law.” (Ibid.)
When “ ‘the trial court sustains a demurrer without leave to amend, we review the determination that no amendment could cure the defect in the complaint for an abuse of discretion. [Citation.] The trial court abuses its discretion if there is a reasonable possibility that the plaintiff could cure the defect by amendment.” (Brown, supra, 247 Cal.App.4th at p. 279.)
B. Vanpelt Fails to Demonstrate She Can Successfully Amend the Complaint.
Although her opening brief advances various reasons that defendants’ demurrer was “fatally flawed,” Vanpelt never clearly claims that the trial court erred by sustaining the demurrer. Instead, the thrust of her arguments is that the court erred by not granting her leave to amend. We conclude that the court did not abuse its discretion by failing to grant leave to amend.
A plaintiff may establish a reasonable possibility of curing the defects in a complaint for the first time on appeal. (Rakestraw v. California Physicians’ Service (2000) 81 Cal.App.4th 39, 43.) “To satisfy that burden . . ., a plaintiff ‘must show in what manner he [or she] can amend [the] complaint and how that amendment will change the legal effect of [the] pleading.’ [Citation.] The assertion of an abstract right to amend does not satisfy this burden. [Citation.] The plaintiff must clearly and specifically set forth the ‘applicable substantive law’ [citation] and the legal basis for amendment, i.e., the elements of the cause of action and authority for it. Further, the plaintiff must set forth factual allegations that sufficiently state all required elements of that cause of action. [Citations.] Allegations must be factual and specific, not vague or conclusionary.” (Id. at pp. 43-44.)
Vanpelt claims that she can amend the complaint to state a claim for wrongful foreclosure. To state such a claim, a plaintiff must allege that: “ ‘(1) the trustee or mortgagee caused an illegal, fraudulent, or willfully oppressive sale of real property pursuant to a power of sale in a mortgage or deed of trust; (2) the party attacking the sale (usually but not always the trustor or mortgagor) was prejudiced or harmed; and (3) in cases where the trustor or mortgagor challenges the sale, the trustor or mortgagor tendered the amount of the secured indebtedness or was excused from tendering.’ ” (Miles v. Deutsche Bank National Trust Co. (2015) 236 Cal.App.4th 394, 408.)
As a threshold matter, it is far from clear that a plaintiff may bring a pre-sale action to challenge an entity’s authority to foreclose. (See Brown, supra, 247 Cal.App.4th at p. 281.) Even assuming that such a cause of action exists, however, borrowers have standing to bring it only if they allege a void, as opposed to merely voidable, assignment of the interest at issue. (See ibid.; Saterbak v. JPMorgan Chase Bank, N.A. (2016) 245 Cal.App.4th 808, 815 (Saterbak).) The complaint purported to allege such an assignment by asserting that MERS’s assignment of the deed of trust to HSBC in 2011 “was void and of no force or effect” for two reasons. The first reason was because the assignment was allegedly “in direct violation of the terms of the Pooling and Servicing Agreement” that applied to the securitized trust for which HSBC acts as trustee. The second reason was because the assignment allegedly failed to comply with federal tax law.
We agree with defendants that neither the alleged failure to comply with the securitized trust’s pooling and service agreement nor the alleged violation of federal tax law establishes a void assignment. There is a “mountain of authority” that assignments in violation of a pooling and service agreement are merely voidable and that “as a result, borrowers do not have standing to challenge late transfers or other defects in the securitization process.” (Mendoza v. JPMorgan Chase Bank, N.A. (2016) 6 Cal.App.5th 802, 815-817; Saterbak, supra, 245 Cal.App.4th at p. 815.) And an allegation that an assignment violated federal tax law relating to securitized trusts similarly fails to confer standing on a borrower. (Mendoza, at pp. 817-818.) Vanpelt did not file a reply brief, and her opening brief does not offer any reasoned argument on these issues but instead primarily rests on the complaint’s conclusory characterization of the assignment as void. She therefore fails to convince us that she can amend the complaint to state a claim for wrongful foreclosure.
As to her other cause of action, Vanpelt never explicitly argues that she can amend the complaint to state a claim under section 2924.17. In particular, she does not address the trial court’s ruling that her complaint was deficient because she failed to allege that defendants had not sufficiently reviewed the evidence before filing foreclosure documents. And because she did not file a reply brief, she fails to respond to defendants’ argument, with which we agree, that section 2924.17 does not apply to the notice of default here because the notice was recorded three years before that statute (part of the California Homeowner Bill of Rights) took effect. (See Saterbak, supra, 245 Cal.App.4th at p. 818.) Thus, Vanpelt has not demonstrated a reasonable possibility that she could amend the complaint to state a claim under section 2924.17.
Finally, Vanpelt contends that the trial court erred by not granting her leave to amend based on her original counsel’s “abandonment” of her, thus depriving her of the opportunity to find new representation and amend the complaint. Even if we were to accept that the court had some obligation to Vanpelt in this regard, we perceive no error. The record is silent as to why her counsel did not oppose the demurrer and what prompted her to seek new representation. She never sought relief from the court based on counsel’s performance, and we agree with defendants that there is no support for her assertion that the court knew about counsel’s alleged abandonment of her. Based on this record, the court did not abuse its discretion by failing to grant leave to amend the complaint.
III.
DISPOSITION
The judgment is affirmed.

 

_________________________
Humes, P.J.


We concur:


_________________________
Margulies, J.


_________________________
Banke, J.















Vanpelt v. HSBC Bank (A148643)