Filed 4/9/18 Brewster v. American Brokers Conduit CA4/2

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

FOURTH APPELLATE DISTRICT

DIVISION TWO



CICELY BREWSTER,

Plaintiff and Appellant,

v.

AMERICAN BROKERS CONDUIT,

Defendant and Respondent.


E066830

(Super.Ct.No. RIC1411494)

OPINION


APPEAL from the Superior Court of Riverside County. John W. Vineyard, Judge. Affirmed.
Cicely Brewster, in pro. per., and for Plaintiff and Appellant.
No appearance for Defendant and Respondent.
In 2012, Cicely Brewster lost her home to foreclosure after she could no longer make payments on her refinanced mortgage. This is her fourth lawsuit to regain her former residence. In this suit, a quiet title action, Brewster named as defendants American Brokers Conduit (ABC, the respondent in this appeal )—the lender on her refinanced loan, and Deutsche Bank National Trust Company (Deutsche)—the substituted trustee who initiated the foreclosure, assigned Brewster’s debt to another trustee, then purchased the property at the trustee’s sale. Brewster’s complaint alleged Deutsche was not a valid trustee due to untimely debt assignment. In May 2015, the trial court sustained Deutsche’s demurrer without leave to amend and entered a “Judgment of Dismissal with Prejudice” in favor of Deutsche.
Several months later in the same action, Brewster requested and obtained from the clerk of the trial court entry of default against ABC, as well as dismissal of the unnamed Doe defendants. Brewster then applied to the trial court to enter a default judgment under Code of Civil Procedure section 585 quieting title in her favor against ABC. After holding an evidentiary hearing, the court denied Brewster’s request and dismissed her complaint without prejudice in July 2016.
Brewster then filed a notice purporting to appeal from the 2015 order sustaining Deutsche’s demurrer, as well as the 2016 order dismissing her complaint. By separate order, we dismissed her appeal of the 2015 order as untimely (she far exceeded the 180-day deadline set out in California Rules of Court, rules 8.104(a) & 8.108) and construed her notice as appealing only the 2016 order of dismissal.
In her appellate brief, Brewster argues she was entitled to a default judgment against ABC and as a result the trial court erred in dismissing her complaint. However, most of her brief reargues the merits of Deutsche’s demurrer, despite our earlier order dismissing that aspect of her appeal. We disregard Brewster’s belated arguments about the demurrer and Deutsche’s title to the property, and affirm the judgment of dismissal. As we explain, quiet title plaintiffs like Brewster are not entitled to default judgment but are instead required by statute to prove their title to the property at a hearing where the court considers the plaintiff’s evidence plus the evidence submitted by any other party claiming an interest in the property. (Code Civ. Proc., § 764.010 (unlabeled statutory citations refer to this code); Harbour Vista, LLC v. HSBC Mortgage Services Inc. (2011) 201 Cal.App.4th 1496, 1501-1502 (Harbour Vista).) Seeing as the trial court already found Deutsche the prevailing party in Brewster’s quiet title action, we conclude it correctly denied her request to quiet title in her favor against ABC.
I
FACTUAL BACKGROUND
In October 2006, Brewster refinanced the mortgage on her Moreno Valley home (the property) by borrowing $384,750 from ABC, a New York corporation. The loan carried an initial interest rate of 1.875 percent, but was subject to change each month until it reached a 10.550 percent rate cap. The promissory note for the new loan was secured by a deed of trust, which named Brewster as the borrower, ABC as the lender, Mortgage Electronic Registration Systems, Inc. (MERS) as ABC’s nominee, and United General Title Insurance as the trustee. ABC recorded the deed of trust on November 9, 2006. On August 1, 2011, MERS assigned the loan and the deed of trust to Deutsche as the new trustee. The assignment was recorded on August 19, 2011.
Brewster admits that around this time she suffered financial hardship and stopped making mortgage payments. On August 16, 2011, Deutsche recorded a notice of default through T.D. Service Company, notifying Brewster she was over $8,000 behind in her payments. On October 27, 2011, T.D. Service Company recorded a substitution of trustee whereby Deutsche transferred the loan and the deed of trust to Power Default Services, Inc. as the new trustee. Brewster remained in default on her mortgage payments, and Power Default Services, Inc. noticed a trustee’s sale for December 2011.
At this point, Brewster filed her first lawsuit against Deutsche, alleging theft, fraud, and violation of her Fourth Amendment right against unlawful seizure. The trial court (Riverside County Superior Court) sustained Deutsche’s demurrer and dismissed Brewster’s complaint with prejudice. Deutsche then purchased the property at a trustee’s sale in June 2012.
In November 2012, Brewster filed a second lawsuit against Deutsche, this time in federal bankruptcy court, arguing the bank lacked authority to initiate the foreclosure proceedings because it was never validly assigned her loan or deed of trust. The bankruptcy court dismissed the action in Deutsche’s favor and the federal district court affirmed.
In December 2012, Brewster filed her third lawsuit against Deutsche, this time back in Riverside County Superior Court, but ended up seeking voluntary dismissal. Meanwhile, Brewster remained on the property and Deutsche brought an unlawful detainer action and obtained a judgment for possession. Brewster unsuccessfully appealed, and was evicted in February 2015.
Immediately after her eviction, Brewster filed this quiet title suit, which asserted the same arguments from the bankruptcy action. This time, she added ABC as a defendant, as well as all parties claiming an interest in the property (the Doe defendants). In its demurrer, Deutsche argued Brewster’s action was barred by res judicata and collateral estoppel. Deustche also argued the action failed as a matter of law because Brewster had never tendered the outstanding balance on her loan and her substantive claim of invalid debt assignment lacked merit.
As noted above, the trial court sustained the demurrer without leave to amend and entered a “Judgment of Dismissal with Prejudice” in favor of Deutsche in May 2015. At Deutsche’s request, the trial court expunged the lis pendens Brewster had previously obtained on the property when she initiated the quiet title action. (See § 761.010.)
Then, in August 2015, Brewster sought and obtained entry of default against ABC from the clerk of the trial court in her quiet title action. Three months later, she voluntarily dismissed the Doe defendants. In February 2016, she filed a declaration under section 585, subdivision (d) in support of a “quiet title judgment.” In her declaration, Brewster told the court ABC committed fraud by failing to inform her it was “a corporation that had never registered in the State of California,” and as a result, the deed of trust was false. She informed the court she had obtained entry of default against ABC and was therefore entitled to default judgment. She asked the court to declare her the rightful owner of the property and quiet title in favor of her against “ABC, its successors and/or assigns.”
The court held a hearing on Brewster’s request in April 2016. We do not have a transcript from that hearing, but the minute order reflects the court continued the matter to May so Brewster could “provide further proof.” In that vein, Brewster filed another, nearly identical declaration, and this time attached a document signed by the Secretary of State certifying “there is no record of a California or foreign corporation, active or inactive, of the name: American Brokers Conduit.” The minute order from the May 2016 hearing reflects the trial court denied Brewster’s request for quiet title because the “proposed judgment is contrary to the interest of Deutsch[e] Bank who is the prevailing party in this case.” Before filing this appeal, Brewster filed two unsuccessful writ petitions in this court—one challenging the trial court’s expungement of the lis pendens and the other challenging its refusal to enter default judgment quieting title in her favor against ABC.
II
DISCUSSION
Brewster argues the trial court erred by refusing to treat her complaint’s allegations as true in the face of ABC’s default and enter a default judgment quieting title in her favor under section 585, subdivision (c). This argument has major problems, the first of which is Brewster’s assumption she can obtain a section 585 default judgment in a quiet title action.
This appeal concerns sections of the Code of Civil Procedure, which we construe independently. (People ex rel. Lockyer v. Shamrock Foods Co. (2000) 24 Cal.4th 415, 432 [appellate courts review questions of law de novo].) Section 760.010 et seq. establishes how a plaintiff may quiet title in property. Section 760.020 allows a plaintiff to bring an action “to establish title against adverse claims to real . . . property.” (§ 760.020, subd. (a).) Section 764.010 provides, “The court shall examine into and determine the plaintiff’s title against the claims of all the defendants. The court shall not enter judgment by default but shall in all cases require evidence of plaintiff’s title and hear such evidence as may be offered respecting the claims of any of the defendants, other than claims the validity of which is admitted by the plaintiff in the complaint. The court shall render judgment in accordance with the evidence and the law.” (Italics added.)
“The Legislature has not left anything to the imagination about whether a trial court can enter a default judgment in a quiet title action. ‘The court shall not enter judgment by default’ is unequivocal. Moreover, unlike the ordinary default prove-up, in which a defendant has no right to participate [citation], before entering any judgment on a quiet title cause of action the court must ‘in all cases’ ‘hear such evidence as may be offered respecting the claims of any of the defendants.’” (Harbour Vista, supra, 201 Cal.App.4th 1496, 1501-1502.)
In claiming the trial court erred by failing to enter default judgment against ABC, Brewster relies on section 585, subdivision (c), which permits a plaintiff to “apply to the court for the relief demanded in the complaint” when the defendant she served by publication has not responded. That provision requires the court to “hear the evidence offered by the plaintiff, and . . . render judgment in the plaintiff’s favor for that relief . . . as appears by the evidence to be just.” (§ 585, subd. (c).) However, section 764.010 specifically removes quiet title actions from section 585’s reach. “[T]he unambiguous language of section 764.010 precludes a traditional default prove-up in quiet title actions and imposes an absolute ban on a ‘judgment by default’ in such actions.” (Nickell v. Matlock (2012) 206 Cal.App.4th 934, 947; see also Harbour Vista, supra, 201 Cal.App.4th at p. 1500.) “[N]otwithstanding a defendant’s default in a quiet title action, the plaintiff is not automatically entitled to judgment in its favor but must prove its case in an evidentiary hearing with live witnesses and any other admissible evidence.” (Nickell v. Matlock, at p. 947, italics added.)
Even if we construe Brewster’s request for default judgment under section 585 as a request for judgment of title under section 764.010, the second problem with this appeal is Brewster’s evidence failed to establish she holds title to the property. For starters, she admits she stopped making payments on her mortgage and does not claim she ever attempted to tender her outstanding balance. This alone is fatal to a quiet title claim. (Aguilar v. Bocci (1974) 39 Cal.App.3d 475, 477-478 [plaintiff not entitled to quiet title in real property without proof of discharged debt].) Second, a necessary element of every quiet title claim is an adverse claim to the property, and here ABC has no adverse claim to title. (See West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 801-802 [where another party purchased the property in a foreclosure sale, plaintiff’s quiet title claim against the lender fails because the lender no longer holds any interest in the property]; Orcilla v. Big Sur, Inc. (2016) 244 Cal.App.4th 982, 1010 [same].) ABC’s interest in the property extinguished when it assigned Brewster’s debt to Deutsche.
This brings us to the most significant problem with Brewster’s appeal. It is against the wrong party. Brewster’s actual dispute is against Deutsche (as evidenced by her previous lawsuits and her near total focus on Deustche in this appeal), but Deutsche was already found to be the prevailing party and is not part of this appeal. This leaves Brewster fighting for title against ABC, a party who has no interest in the property. Over the better part of a decade Brewster had her day in court to prevent foreclosure. This last attempt to quiet title through default judgment against ABC, a party with no interest in the property, is simply an attempt to challenge the court’s determination that Deutsche had gained title to the property. We are not unsympathetic to those who lost their homes in some part due to the financial crisis of 2007 and 2008 and the mortgage industry’s reckless lending practices. But, however unfortunate Brewster’s financial situation may have been, it does not entitle her to keep a property she purchased with a loan she did not repay or relitigate an issue that has already been adjudicated.
We conclude there was no basis for the trial court to quiet title in Brewster’s favor and thus affirm its refusal to do so and its order dismissing the complaint.
III
DISPOSITION
We affirm. Appellant shall bear her own costs on appeal.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS

SLOUGH
J.

We concur:


MILLER
Acting P. J.


CODRINGTON
J.