Reavis v. HSBC Mortgage CA2/5 ( 2014 )

Filed 12/17/14 Reavis v. HSBC Mortgage CA2/5
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication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
SECOND APPELLATE DISTRICT
DIVISION FIVE
THOMAS REAVIS, B254233
Plaintiff and Appellant, (Los Angeles County Super. Ct.
No. EC058315)
v.
HSBC MORTGAGE CORPORATION et
al.,
Defendants and Respondents.
APPEAL from the judgments of the Superior Court of Los Angeles, Laura A.
Matz, Judge. Affirmed.
Law Offices of Rick L. Raynsford and Rick L. Raynsford for Plaintiff and
Appellant.
Katten Muchin Rosenman, Stuart M. Richter, Gregory S. Korman, for Defendants
and Respondents HSBC Mortgage Corporation (USA) and Federal National Mortgage
Association.
Burke, Williams & Sorensen, Richard J. Reynolds, Joseph P. Buchman, for
Defendant and Respondent MTC Financial Inc. dba Trustee Corps.
Fidelity National Law Group and Helen P. Hoeffel for Defendant and Respondent
Robert Hall.
________________________________
Plaintiff and appellant Thomas Reavis appeals from judgments of dismissal
following orders granting summary judgment in favor of defendants and respondents
HSBC Mortgage Corporation (USA), Federal National Mortgage Association (FNMA),
MTC Financial Inc. doing business as Trustee Corps, and buyer Robert Hall in this action
arising out of a foreclosure sale. Reavis contends: (1) one of the two adjacent lots was
not sold at the foreclosure sale because the assessor’s parcel number was not listed in the
notice of sale as required under Civil Code section 2924f, subdivision (b)(5);1 (2) a
covenant combining the lots was unenforceable; and (3) the removal of Reavis and his
personal property from the vacant lot constituted trespass. We conclude the record is
inadequate to review the contentions on appeal because it does not contain a reporter’s
transcript or suitable substitute for the hearings on the summary judgment motions. Even
if we found the record adequate to permit review, we would conclude the trial court
properly found the omission of the assessor’s parcel number was immaterial and not
prejudicial. We therefore affirm the judgments.
FACTS
Lots 21 and 22 of the Whitegate Tract in the City of Los Angeles are adjacent to
one another. On December 12, 1974, the owners recorded a covenant combining lots 21
and 22 at the address 10414 Whitegate Avenue in Sunland, California. They agreed to
hold the land as one parcel and not sell any portion separately. The covenant stated,
“This covenant and agreement shall run with the land and shall be binding upon
ourselves, and future owners, encumbrancers, their successors, heirs, assignees and shall
continue in effect until such time that the Los Angeles Municipal Code unconditionally
permits the use or purpose herein above referred to or unless otherwise released by
authority of the Superintendent of Building of the City of Los Angeles.”
1 All further statutory references are to the Civil Code, unless otherwise stated.
2
Lot 21 is vacant and lot 22 is improved with a residence. Lot 21 is identified by
assessor parcel number (APN) 2559-010-028 and assessed property taxes separately from
lot 22, which is identified as APN 2559-010-029.
Reavis purchased the property in April 1998. In August 2008, he borrowed
$266,000 from HSBC secured by a deed of trust on the property. The Deed of Trust
stated the parcel ID number of the property was 2559-010-029 and 2559-060-028, which
had the address of 10414 Whitegate Avenue. An attached schedule described the
property as lots 21 and 22 of the Whitegate Tract in the City of Los Angeles.
Reavis defaulted on his loan payments. MTC sent a notice of trustee’s sale, which
listed one APN 2559-010-029. The notice identified the deed of trust recorded in August
2008. The notice stated pursuant to the power of sale in the deed of trust, the property
described in the deed of trust would be sold on October 28, 2010, unless Reavis took
action to protect the property. The notice stated the property was being sold “as is,” and
gave the street address of 10414 Whitegate Ave., (Sunland Area) Los Angeles, CA
91040. The notice stated, “The total amount of the unpaid balance of the obligations
secured by the property to be sold and reasonable estimated costs, expenses and advanced
at the time of the initial publication of this Notice of Trustee’s Sale is estimated to be
$279,789.76 (Estimated), provided, however, prepayment premiums, accrued interest and
advances will increase this figure prior to sale.”
FNMA purchased the property at the sale. MTC recorded a trustee’s deed upon
sale. The deed identified APN 2559-010-029. MTC granted FNMA the property
described in an attached exhibit. The exhibit listed lots 21 and 22 of the Whitegate Tract
in the City of Los Angeles. The Trustee’s deed upon sale stated the amount of the unpaid
debt together with costs was $281,793.14.
FNMA filed an unlawful detainer action against Reavis on December 21, 2010,
and obtained a judgment for possession on July 11, 2011. Reavis was served with a
notice to vacate the residence. He moved to lot 21.
On February 21, 2012, FNMA recorded a “corrective” trustee’s deed upon sale
that listed both APNs and the property description of lots 21 and 22. FNMA hired real
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estate broker Oak Tree Realty Group to market the property. Oak Tree visited the
property with law enforcement officers to remove Reavis from lot 21. FNMA sold the
property to Hall on April 4, 2012.
On May 9, 2012, Hall recorded a termination of the covenant in order to develop
each lot into a single family residence.
PROCEDURAL BACKGROUND
Reavis filed a complaint on April 24, 2012. He filed an amended complaint on
July 31, 2012, against several defendants, including respondents, for trespass, fraud,
cancelation of trustee’s deed, cancelation of grant deed, quiet title, waste and declaratory
relief.
On July 19, 2013, Hall filed a motion for summary judgment. HSBC and FNMA
filed a motion for summary judgment on August 23, 2013. MTC filed a motion for
summary judgment on September 6, 2013. The motions were brought on the grounds
that Hall was a bona fide purchaser for value without notice, the covenant prevented the
lots from being sold separately as a matter of law and Reavis could not have believed in
good faith that the lots were being sold separately, the unlawful detainer action had
previously litigated and determined the right to possess the premises, and omission of the
second APN from the notice was immaterial.
Reavis opposed each motion on the grounds that the covenant was unenforceable,
because it failed to comply with section 1468 and lacked consideration, title was not
adjudicated in the unlawful detainer action, and the failure to list the APN for lot 21 was
not immaterial, because the APN was a substantive requirement of section 2924f,
subdivision (b). The defendants filed replies.
A hearing was held on November 8, 2013, on the motions of Hall, HSBC and
FNMA. No reporter’s transcript of the hearing is part of the record on appeal. The
minute order reflects that the trial court granted the motions for summary judgment. The
court found Reavis’s claims were based entirely on the argument that the nonjudicial
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foreclosure was invalid as to lot 21, because the notice of trustee’s sale did not comply
with section 2924f, subdivision (b)(5), requiring the notice to describe the property by
giving its street address or other common designation and a county APN. In this case,
based on all the facts, the failure to include a county APN for one of the lots was not
material to the transaction and was cumulative. Failure to include the APN for one of
two lots did not compel invalidation of the sale. On its face, the notice stated the correct
common address and expressly stated the property was more fully described on the deed
of trust, which in turn, included the correct APNs for both lots. The record title of the
property, of which Reavis had constructive notice, included the deed of trust and the
covenant to hold the property as one parcel. Regardless of the enforceability of the
covenant, it was recorded when Reavis took title to the property. Under the
circumstances, the court found no reasonable inference could be made that omission of
the APN for lot 21 was material and Reavis failed to establish any materiality or
prejudice from the omission. As to the causes of action for cancellation of the grant deed,
quiet title and declaratory relief, the motion was additionally granted on the ground that
Reavis failed to tender the amount owed.
There was apparently a hearing on MTC’s motion for summary judgment at a later
date. No minute order or reporter’s transcript is part of the record on appeal. A tentative
ruling reflects the trial court granted MTC’s motion for summary judgment for the same
reasons as the prior motions. In addition, the trial court noted the facts did not support
any conduct constituting trespass by MTC.
The trial court entered an order granting Hall’s motion for summary judgment on
December 5, 2013, and judgment in favor on Hall on December 9, 2013. The court
entered an order granting HSBC and FNMA’s motion for summary judgment on
December 6, 2013, and apparently entered a premature judgment in favor of HSBC and
FNMA on December 5, 2013. The court entered an order granting MTC’s motion for
summary judgment on January 6, 2014, and judgment in favor of MTC that same day.
Reavis filed a timely notice of appeal from the three judgments.
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DISCUSSION
Standard of Review and Adequacy of the Record
“[W]e review the grant of summary judgment de novo. [Citation.] In performing
our independent review, we conduct the same procedure used by the trial court. We
examine: (1) the pleadings to determine the elements of the claim for which the party
seeks relief; (2) the summary judgment motion to determine if movant established facts
justifying judgment in its favor; and (3) the opposition to the motion—assuming movant
met its initial burden—to ‘decide whether the opposing party has demonstrated the
existence of a triable, material fact issue. [Citation.]’ [Citations.]” (Y.K.A. Industries,
Inc. v. Redevelopment Agency of City of San Jose (2009) 174 Cal.App.4th 339, 354.)
Statutory interpretation is a question of law we review independently. (Camarillo
v. Vaage (2003) 105 Cal.App.4th 552, 560.) Our primary task is to determine the intent
of the legislative body, so as to construe the statute to effectuate that purpose. (Doe v.
Brown (2009) 177 Cal.App.4th 408, 417.) We begin with the words of the statute.
(Ibid.) “Words used in a statute or constitutional provision should be given the meaning
they bear in ordinary use. [Citations.] If the language is clear and unambiguous there is
no need for construction, nor is it necessary to resort to indicia of the intent of the
Legislature . . . . [Citations.]” (Lungren v. Deukmejian (1988) 45 Cal.3d 727, 735.)
When a statute is susceptible to more than one reasonable interpretation, we may
consider a variety of extrinsic aids, such as the legislative history. (Granberry v. Islay
Investments (1995) 9 Cal.4th 738, 744.)
Inadequate Record on Appeal
The appellate record does not contain any reporter’s transcripts or a minute order
from the hearing on MTC’s motion for summary judgment. In the absence of reporter’s
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transcripts or a suitable substitute, the record is inadequate to review Reavis’s contentions
and the judgment must be affirmed.
“[A] party challenging a judgment has the burden of showing reversible error by
an adequate record.” (Ballard v. Uribe (1986) 41 Cal.3d 564, 574.) “‘A judgment or
order of the lower court is presumed correct. All intendments and presumptions are
indulged to support it on matters as to which the record is silent . . . .’ . . . [Citation.]”
(Rossiter v. Benoit (1979) 88 Cal.App.3d 706, 712.) In the absence of a proper record on
appeal, the judgment is presumed correct and must be affirmed. (Maria P. v. Riles
(1987) 43 Cal.3d 1281, 1295-1296.)
California Rules of Court, rule 8.120(b) provides: “If an appellant intends to raise
any issue that requires consideration of the oral proceedings in the superior court, the
record on appeal must include a record of these oral proceedings . . . .” If the proceedings
were not recorded, California Rules of Court, rule 8.137 contains procedures for filing a
settled statement.
Without a reporter’s transcript of the hearing or a suitable substitute, which would
reveal the parties’ arguments to the court and any concessions concerning the facts, issues
and evidence, Reavis cannot meet his burden to show reversible error. In the absence of
an adequate record, we must indulge all inferences to support the order challenged on
appeal and presume the trial court properly concluded that no triable issues of material
facts existed.
Civil Code Section 2924f, Subdivision (b)(5)
Even if we were to find the appellate record adequate for review in this case, we
would conclude the trial court’s ruling was correct. Reavis contends section 2924f,
subdivision (b)(5) requires the property’s APN to be listed in the trustee’s notice of sale.
We agree with the trial court that any defect in listing the APN was immaterial and not
prejudicial under the facts of this case.
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Sections 2924 through 2924k “provide a comprehensive framework for the
regulation of a nonjudicial foreclosure sale pursuant to a power of sale contained in a
deed of trust. The purposes of this comprehensive scheme are threefold: (1) to provide
the creditor/beneficiary with a quick, inexpensive and efficient remedy against a
defaulting debtor/trustor; (2) to protect the debtor/trustor from wrongful loss of the
property; and (3) to ensure that a properly conducted sale is final between the parties and
conclusive as to a bona fide purchaser. [Citation.]” (Moeller v. Lien (1994) 25
Cal.App.4th 822, 830.)
Section 2924f, subdivision (b)(5) provides that the notice of sale must contain
certain contact information for the trustee and the trustee’s agent. It also states, “In
addition to any other description of the property, the notice shall describe the property by
giving its street address, if any, or other common designation, if any, and a county
assessor’s parcel number; but if the property has no street address or other common
designation, the notice shall contain a legal description of the property, the name and
address of the beneficiary at whose request the sale is to be conducted, and a statement
that directions may be obtained pursuant to a written request submitted to the beneficiary
within 10 days from the first publication of the notice. Directions shall be deemed
reasonably sufficient to locate the property if information as to the location of the
property is given by reference to the direction and approximate distance from the nearest
crossroads, frontage road, or access road. If a legal description or a county assessor’s
parcel number and either a street address or another common designation of the property
is given, the validity of the notice and the validity of the sale shall not be affected by the
fact that the street address, other common designation, name and address of the
beneficiary, or the directions obtained therefrom are erroneous or that the street address,
other common designation, name and address of the beneficiary, or directions obtained
therefrom are omitted.”
“‘“The power of sale under a deed of trust will be strictly construed, and in its
execution the trustee must act in good faith and strictly follow the requirements of the
deed with respect to the manner of sale. The sale will be scrutinized by courts with great
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care and will not be sustained unless conducted with all fairness, regularity and
scrupulous integrity.”’ [Citation.]” (Millennium Rock Mortg., Inc. v. T.D. Service
Co. (2009) 179 Cal.App.4th 804, 809-810.)
“Strict compliance” to foreclosure notice requirements does not mean a trustee’s
sale must be invalidated for trivial procedural defects. (Knapp v. Doherty (2004) 123
Cal.App.4th 76, 93.) If the trustee has otherwise fully complied with the statutory notice
requirements of the Civil Code, a slight deviation will not invalidate a foreclosure sale.
(Ibid.) “[C]ourts have rejected claims of deficient notice where no prejudice was suffered
as a result of the procedural irregularity.” (Id. at p. 94.)
“‘“As a general rule, there is a common law rebuttable presumption that a
foreclosure sale has been conducted regularly and fairly.” [Citations.] Accordingly, “[a]
successful challenge to the sale requires evidence of a failure to comply with the
procedural requirements for the foreclosure sale that caused prejudice to the person
attacking the sale.” [Citation.] . . . [T]he presumption must prevail when the record
lacks substantial evidence of a prejudicial procedural irregularity. [Citation.]’
[Citations.]” (Knapp v. Doherty, supra, 123 Cal.App.4th at p. 96.)
In this case, there was no evidence that the omission of one APN for the property
was prejudicial to Reavis. It is undisputed that Reavis defaulted on the loan, which was
secured by both lots. A recorded covenant, of which Reavis had constructive notice,
required lots 21 and 22 to be sold as one property. The trustee’s notice of sale
specifically identified the deed of trust and stated that the property described in the deed
of trust would be sold on October 28, 2010, unless Reavis took action to protect the
property. It is undisputed that lots 21 and 22 were both described in the deed of trust. In
addition, the notice stated the street address of the property to be sold was 10414
Whitegate Ave., which is the address of both lots. The notice provided the amount of the
unpaid balance secured by the property to be sold, which was the full amount of the loan
secured by the combined lots. Based on this evidence, there is no triable issue of fact and
Reavis has not identified any prejudice from the omission of the APN for lot 21 from the
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trustee’s notice of sale. The finding that the omission was immaterial resolves all of the
causes of action, including trespass. The trial court properly granted summary judgment.
DISPOSITION
The judgments are affirmed. Respondents HSBC Mortgage Corporation (USA),
Federal National Mortgage Association, MTC Financial Inc., and Robert Hall are
awarded their costs on appeal.
KRIEGLER, J.
I concur:
TURNER, P. J.
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MOSK, J., Concurring
I concur.
I do not agree that the record is inadequate. We review summary judgment de
novo. Thus, it generally does not matter what was said at the hearing. No one has
suggested that anything occurred at the hearing that would affect our review. The very
fact that we reviewed the summary judgment on the merits establishes that there is no
need for a reporter’s transcript of the hearing. None of the cases cited for the proposition
that the lack of a reporter’s transcript rendered the record inadequate involved de novo
review.
The judicial process is expensive enough without forcing litigants to pay for a
reporter or to obtain a settled or agreed statement in order to preserve their right to appeal
a matter that will be reviewed de novo.
I otherwise concur in the judgment.
MOSK, J.