Parker v. Los Angeles County Registrar-Recorder/County Clerk CA2/4 ( 2015 )

Filed 3/27/15 Parker v. Los Angeles County Registrar-Recorder/County Clerk CA2/4
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication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 FOUR
ERWIN L. PARKER et al., B256984
Plaintiffs and Appellants, (Los Angeles County
Super. Ct. No. VC063752)
v.
LOS ANGELES COUNTY
REGISTRAR-RECORDER/COUNTY
CLERK et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court for Los Angeles County,
Margaret M. Bernal, Judge. Affirmed.
Erwin L. Parker and Deborah Brown Parker, in pro. per., for Plaintiffs and
Appellants.
Anglin Flewilling Rasmussen Campbell & Trytten and Robert A. Bailey for
Defendant and Respondent Wells Fargo Bank, N.A.
Mark J. Saladino, County Counsel, and Laura T. Jacobson, Associate
County Counsel, for Defendants and Respondents Los Angeles County Registrar-
Recorder/County Clerk and Los Angeles County Sheriff’s Department.
Plaintiffs Edwin L. Parker and Debora Brown Parker (the Parkers) filed a
taxpayer’s lawsuit against defendants Los Angeles County Registrar-
Recorder/County Clerk (Recorder), Los Angeles County Sheriff’s Department1
(Sheriff), Wells Fargo Home Mortgage, Inc., aka Wells Fargo Bank, N.A. (Wells
Fargo), and Cal-Western Reconveyance, LLC (Cal-Western), essentially seeking to
stop a nonjudicial foreclosure on their property by enjoining Recorder from
recording or maintaining various documents related to their mortgage and the
foreclosure, and by enjoining Sheriff from executing a writ of possession issued
after a trustee’s sale, on the ground that the documents were fraudulent. The trial
court sustained without leave to amend demurrers filed by Recorder, Sheriff, and
Wells Fargo, and dismissed the lawsuit. We affirm.
BACKGROUND
The Parkers’ first amended complaint2 alleges that Recorder allowed the
filing and recording of the following documents, which the Parkers allege are
fraudulent:
1. Deed of Trust, filed and recorded on February 27, 2004, which lists
Mortgage Electronic Registration Systems, Inc. (MERS) as a nominee and
beneficiary for the lender and the lender’s successors and assigns. The Parkers
allege the document is fraudulent because MERS “did not come into existence in
California until July 21, 2010.”
2. Substitution of Trustee and Full Reconveyance filed and recorded on
February 15, 2006, which lists MERS as a current beneficiary under the Deed of
1
The Parkers misidentified the Los Angeles County Sheriff’s Department, referring
to it as the Los Angeles County Sheriff’s Office.
2
The record on appeal does not include the original complaint.
2
Trust, and states that MERS substitutes ReconTrust Company as the new trustee.
The Parkers allege that MERS “did not exist in California at this time making this
transfer of beneficial interest in the Deed of Trust voidable.”
3. Assignment of Deed of Trust, filed and recorded on February 15,
2006, in which Americorp Funding grants, assigns, and transfers all beneficial
interest under the Deed of Trust to MERS. The Parkers allege that this document
is invalid and fraudulent because MERS “is only a conduit used by the banks to
tract [sic] the beneficial interest transfer in mortgages from one lender to the next,”
and MERS does not have the capacity to transfer or to accept a transfer of any
rights, title, or beneficial interest in the Parkers’ Deed of Trust or Note, according
to MERS’ procedure manual.
4. Substitution of Trustee, filed and recorded on October 12, 2010,
which was executed by Wells Fargo and names Cal-Western as attorney-in-fact
and new trustee. The Parkers allege the document is fraudulent and invalid for
several reasons: (a) there was “no showing of a proper ‘jurat’ which is required for
attorney in fact documents”; (b) “there should be no need to make Cal-Western an
attorney in fact for the lender if the beneficial interest of the Deed of Trust is
properly transferred by a legitimate transaction by the legitimate beneficiary under
the Deed of Trust”; and (c) the hand writing in the notary’s certification and the
notary’s signature appear to have been written by different people.
5. Notices of Trustee’s Sale, dated December 8, 2010 and October 25,
2013, which the Parkers allege are invalid “due to the previous chain of fraudulent
title documents recorded in the Office of the County Recorder.”
In addition, the Parkers allege that Wells Fargo and Cal-Western conspired
together to institute a foreclosure against their property using fraudulent
documents, and that Sheriff will “effectuate the writ of possession and writ of
eviction regardless of the rights and remedies of [the Parkers].” They allege that
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“[u]nless enjoined by this court, [Recorder] and its officials will continue to house,
maintain, record and disseminate fraudulent title documents against [the Parkers’]
property and at some point [Sheriff] will effectuate the eviction of [the Parkers]
based upon these same fraudulent documents, which constitutes an abuse of and/or
a waste of the Defendants’ time and waste of taxpayer funds to the injury of [the
Parkers].” The Parkers seek declaratory relief and injunctive relief under Code of
Civil Procedure3 section 526a and Civil Code section 3368 to enjoin Recorder and
Sheriff from “recording, housing, maintaining, and disseminating fraudulent title
documents which [have] unlawfully encumbered the title rights of [the Parkers],”
and to declare that “all proceedings pertaining to those acts of Defendants [are]
null and void and set aside.”
Recorder and Sheriff jointly filed a demurrer to the complaint. They argued
that the complaint fails to state a cause of action against them because their duties
are prescribed by law and do not include review of documents for legal
sufficiency. It appears that Wells Fargo also filed a demurrer to the complaint, but
it is not included in the record on appeal.
Before the hearing on the demurrers, the Parkers filed an ex parte application
for a temporary restraining order to restrain Sheriff from evicting them. They
argued that they are entitled to a hearing on the merits of their taxpayer lawsuit
challenging Sheriff’s use of taxpayer funds to unlawfully evict them without due
process of law. The trial court found good cause did not exist, and denied the ex
parte application.
The trial court subsequently held a hearing on the demurrers, and sustained
them without leave to amend. The court found that neither Recorder nor Sheriff
“has a legal duty to assess the veracity of a document or to determine the validity
3
Further undesignated statutory references are to the Code of Civil Procedure.
4
of the underlying claims.” As to Wells Fargo, the court found that although Wells
Fargo was named in the complaint, the Parkers do not seek any relief against it.
Finally, the court noted that the instant action appears to be duplicative of other
cases filed by the Parkers, and is an improper challenge to pending foreclosure
proceedings.
The Parkers timely filed a notice of appeal.
DISCUSSION
On appeal, the Parkers contend that the trial court erred by denying the
application for a temporary restraining order and by sustaining Recorder and
Sheriff’s demurrer without leave to amend, and that, by sustaining the demurrer
without leave to amend, the trial court violated their rights under the Fourth, Fifth,
and Fourteenth Amendments to the United States Constitution.4 All of these
contentions are premised upon the Parkers’ assumption that Recorder and Sheriff
can be enjoined under section 526a from filing and recording fraudulent documents
related to mortgages and foreclosure proceedings or executing writs of possession
or writs of eviction based upon those documents. We conclude that the Parkers’
contentions have no merit because their underlying assumption is incorrect.
Division Six of this Appellate District recently addressed a similar lawsuit
brought by a homeowner whose condominium was sold at a trustee’s sale after she
defaulted on a note secured by a deed of trust. (Lyons v. Santa Barbara County
Sheriff’s Office (2014) 231 Cal. App. 4th 1499 (Lyons).) Although that lawsuit was
4
The Parkers do not address Wells Fargo’s demurrer in their appellants’ opening
brief, and did not designate for inclusion in the record on appeal any documents related to
that demurrer. Nevertheless, Wells Fargo filed a respondent’s brief, and contended the
judgment in its favor must be affirmed in light of the Parkers’ failure to address its
demurrer. We agree.
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brought after the trustee’s sale was completed, while the instant lawsuit appears to
have been brought after notice of the trustee’s sale was given but before it took
place, the legal issues are the same. In both lawsuits, the homeowners sought an
order enjoining the county recorder from recording or maintaining fraudulent title
documents that encumbered the title rights of the homeowners and declaring that
the writs of possession issued after the trustee’s sale are null and void and cannot
be executed. (See Lyons, supra, 231 Cal.App.4th at p. 1503.)
As our Division Six colleagues explained in affirming the judgment after the
trial court sustained the defendants’ demurrer without leave to amend, “[s]ection
526a permits a taxpayer action to enjoin illegal governmental activity or the illegal
expenditure or waste of public funds. [Citations.]” (Lyons, supra, 231
Cal.App.4th at pp. 1502-1503.) But “a taxpayer’s action may not be maintained
where the challenged government conduct is legal. [Citation.] ‘Conduct in
accordance with regulatory [or statutory] standards “is a perfectly legal activity”’
and beyond the scope of section 526a. [Citation.]” (Id. at p. 1503.) The court held
that the homeowner’s taxpayer lawsuit could not be maintained because the county
recorder was required under Government Code section 27201, subdivision (a),5 to
record documents when presented, and the sheriff is required under section
5
Government Code section 27201, subdivision (a) provides in relevant part: “The
recorder shall, upon payment of proper fees and taxes, accept for recordation any
instrument, paper, or notice that is authorized or required by statute, or court order to be
recorded, or authorized or required to be recorded by a local ordinance that relates to the
recordation of any instrument, paper, or notice that relates to real property, if the
instrument, paper, or notice contains sufficient information to be indexed as provided by
statute, meets recording requirements of state statutes and local ordinances, and is
photographically reproducible. The county recorder shall not refuse to record any
instrument, paper, or notice that is authorized or required by statute, court order, or local
ordinance that relates to the recordation of any instrument, paper, or notice that relates to
real property to be recorded on the basis of its lack of legal sufficiency.”
6
712.030, subdivision (a),6 to levy on a writ of possession issued by the clerk of the
court following a trustee’s sale. (Id. at pp. 1503-1504.) The court emphasized that
neither the recorder nor the sheriff is required to conduct a fraud investigation
before recording a document that is valid on its face or obeying a court order to
evict a person from real property. (Ibid.)
We agree with the analysis in Lyons. Because Recorder was statutorily
required to record the documents at issue in this case and Sheriff is statutorily
required to execute any writ of possession that may be issued following the
trustee’s sale of the Parkers’ property, a section 526a taxpayer action will not lie to
enjoin Recorder from recording or maintaining those documents or to enjoin
Sheriff from executing the writ of possession.
It is irrelevant that, as the Parkers argue in their opening brief on appeal,
section 526a is a remedial statute that “confer[s] broad standing for taxpayers” to
bring suit. The issue here is not the Parkers’ standing to bring the action, but rather
the absence of illegal activity by a governmental actor that may be enjoined under
section 526a. Similarly, while the Parkers are correct that “[a] general demurrer to
the complaint admits not only the contents of the instrument [set out in the
complaint] but also any pleaded meaning to which the instrument is reasonably
susceptible,” and does not test the plaintiff’s ability to prove the allegations of the
complaint, those principles do not come into play here. Regardless whether the
documents at issue were fraudulent, a section 526a action against Recorder and/or
Sheriff cannot be maintained to enjoin them from carrying out their legal duties by
recording the documents and/or executing the writ of possession.
6
Section 712.030, subdivision (a) provides: “Upon delivery of the writ of
possession or sale to the levying officer to whom the writ is directed, together with the
written instructions of the judgment creditor, the levying officer shall execute the writ in
the manner prescribed by law.”
7
In their appellants’ reply brief, the Parkers cite to Blair v. Pitchess (1971) 5
Cal. 3d 258 (Blair) to argue that a section 526a action may be brought to challenge
the “policy” that Recorder must record fraudulent documents and has no duty to
ascertain the validity of documents submitted for recording. Their reliance on
Blair is misplaced.
In Blair, certain Los Angeles County taxpayers brought an action against the
county and its sheriff, marshal, and deputy sheriff, and the constable of the Malibu
Justice Court, seeking an injunction to restrain the defendants from executing the
provisions of the claim and delivery law. (Blair, supra, 5 Cal.3d at p. 265.) Under
the claim and delivery law in effect at the time of the lawsuit, a plaintiff in an
action to recover the possession of personal property could, any time before the
defendant filed an answer to the plaintiff’s complaint, require the sheriff, constable
or marshal or the county to take the property at issue from the defendant. (Ibid.)
The Blair plaintiffs set forth four causes of action, two of which survived
demurrer. Those causes of action alleged that (1) the claim and delivery law
violated the Fourth and Fourteenth Amendments to the United States Constitution
and Article I, section 19 of the California Constitution because it purported to
authorize the entry into and search of private premises and the seizure of personal
property without the issuance of a warrant upon probable cause; and (2) the law
violated the due process clause of the Fourteenth Amendment of the United States
Constitution and Article I, section 13 of the California Constitution insofar as it
authorized such entry and seizure without timely notice and an opportunity to be
heard on the merits of the claim. (Blair, supra, 5 Cal.3d at pp. 265-266, fn. 3.)
The plaintiffs contended that because the claim and delivery law was
unconstitutional, the county officials were illegally expending county funds “by
expending the time of county officials in executing its provisions.” (Id. at p. 265.)
8
In contrast to Blair, where the plaintiffs sought to enjoin ministerial acts by
county officials that were authorized under a law the plaintiffs alleged was
unconstitutional, the Parkers allege the ministerial acts -- the recording of
documents and execution of a writ of possession -- are unlawful because the
documents are fraudulent and therefore unlawful. The Parkers admit as much
when they state in their appellants’ reply brief, “Appellants are hereby challenging
the illegal and fraudulent documents submitted, and recorded against their
property.” A taxpayer lawsuit under section 526a is not a proper vehicle for such a
challenge because the unlawful act, if any, is that of the person or entity who
submitted the document for recording, rather than the government official who
carried out his or her duty under the law.
Because the conduct by Recorder and Sheriff the Parkers seek to enjoin is
not illegal, the trial court properly sustained the demurrer to the complaint without
leave to amend. (Lyons, supra, 231 Cal.App.4th at pp. 1502-1503.) That ruling
does not, as the Parkers contend in their appellants’ opening brief, violate their
rights under the Fourth, Fifth, and Fourteenth Amendments to the United States
Constitution. Although it is not entirely clear, it appears the basis for this
contention is that as a result of the dismissal of this lawsuit, the Parkers’ property
will be taken from them. But that “taking” will be the result of a nonjudicial
foreclosure proceeding, not the dismissal of the lawsuit. Therefore, the dismissal
of the Parkers’ lawsuit, after the Parkers were given notice and an opportunity to
be heard, does not violate the Parkers’ constitutional rights.
9
DISPOSITION
The judgment is affirmed. Recorder, Sheriff, and Wells Fargo shall
recover their costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
WILLHITE, J.
We concur:
EPSTEIN, P. J.
MANELLA, J.
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