Pantoja v. Countrywide Home Loans CA6 filed 2/28/13 A

SUPREME COURT CASES

Laws-info.com » Cases » California » 6th Appellate District » 2013 » Pantoja v. Countrywide Home Loans CA6 filed 2/28/13 A

State: California

Court: California Eastern District Court

Docket No: H036232

Case Date: 02/28/2013

Plaintiff: Pantoja

Defendant: Countrywide Home Loans CA6 filed 2/28/13 Case Details

Preview:Filed 2/28/13 Pantoja v. Countrywide Home Loans CA6

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

CORNELIO PANTOJA, Plaintiff and Appellant, v. COUNTRYWIDE HOME LOANS, INC., et al., Defendants and Respondents.

H036232 (Santa Clara County Super. Ct. No. CV138528)

Appellant Cornelio Pantoja appeals from an order by the Santa Clara County Superior Court sustaining respondents Countrywide Home Loans Inc., Bank of America Corporation, Old Republic National Title Company, and Old Republic Default Management Services' (collectively "Countrywide") demurrer to his third amended complaint without leave to amend. Pantoja's 18-page complaint alleged only one cause of action, that Countrywide committed unfair business practices and violated California Business and Professions Code sections 17200 and 17500 et seq. by failing to inform Pantoja of transfers of his promissory note to a different beneficiary, failing to provide a proper declaration under California Civil Code section 2923.5,1 failing to explore options to avoid foreclosure as provided under section 2923.5, and failing to engage in good faith
1

Further unspecified statutory references are to the Civil Code.

loan modification or workout discussions pursuant to section 2923.6. This case was previously removed to federal court, which resulted in a published opinion (Pantoja v. Countrywide Home Loans, Inc. (N.D.Cal. 2009) 640 F.Supp.2d 1177) after the court dismissed the complaint with leave to amend. This case was returned to state court after Pantoja amended his complaint to omit any federal claims. For the reasons set forth below, we find that Pantoja sufficiently alleged a cause of action in his complaint. We will accordingly reverse the trial court's judgment in favor of Countrywide with directions to overrule the demurrer and order Countrywide to respond. FACTUAL AND PROCEDURAL BACKGROUND Pantoja's House and Mortgage In June 2006, Pantoja purchased a house in Morgan Hill. In order to purchase the house, Pantoja received a loan in the amount of $514,400 from Greenpoint Mortgage Lending. Pantoja executed a deed of trust on the house to secure the financing. At the time of the financing, Pantoja was told that his monthly mortgage payments would be $3,054 per month and that the mortgage would be refinanced after six months into a lower monthly payment. Pantoja was informed that if no refinance took place, at worst he would be obligated to pay $3,054 per month for 30 years, with no change in the interest rate. Contrary to the information provided to Pantoja, the terms of the mortgage actually stated that the interest rate would remain at 7.125 percent per year for the first three years, resulting in a $3,054 per month mortgage payment. After the first three years, the interest rate could be adjusted upwards by five percentage points to 12.125 percent. After a further six months, the interest rate would cap at 13.125 percent. Pantoja made monthly mortgage payments until June 2008 when he became delinquent. On October 16, 2008, Old Republic Default Management Services recorded a notice of default. Accompanying the notice of default was a declaration of compliance 2

with section 2923.5, which included a marked checkbox next to the statement: "The beneficiary of beneficiary's authorized agent has contacted the borrower pursuant to Civil Code section 2923.5(c) (contract provision to `assess the borrower's financial situation and explore options for the borrower to avoid foreclosure'). State the date `contact' with the borrower(s) were accomplished: Date of contact began on or before September 6, 2006." Contrary to the declaration's claims, Pantoja alleged in his complaint that Countrywide never contacted him to assess his financial situation at least 30 days prior to recording a notice of default, nor did they engage in good faith discussions about loan modifications or other options to avoid foreclosure. On December 9, 2008, Countrywide notified Pantoja that it had taken over the servicing of his mortgage from Greenpoint. On January 30, 2009, Old Republic Default Management filed a notice of trustee sale. The notice of trustee sale did not include a declaration as mandated under section 2923.5, though it did state that the declaration was fulfilled when the notice of default was recorded. Pantoja submitted paperwork to Countrywide in March 2009 to seek a loan modification, though no modification was given. Pantoja's Complaints and Countrywide's Demurrers Pantoja filed an ex parte application for a temporary restraining order to stop the foreclosure sale, which was granted on March 30, 2009. Pantoja filed a complaint in state court for declaratory judgment, wrongful foreclosure, unfair business practices, and equitable estoppels the same day he filed the ex parte application. On April 13, 2009, Countrywide removed the case to the United States District Court on the grounds that there was a federal question.2 Countrywide then moved to dismiss the complaint, which the district court granted with leave to amend. (See Pantoja v. Countrywide Home Pantoja's original complaint referenced several federal statutes, including the Truth in Lending Act (15 U.S.C.

Download H036232.PDF