Too Little, Too Late For Plaintiff's Fraud-Based Mortgage Lawsuit
In Vaca v. Wachovia Mortgage Corporation, --- Cal.Rptr.3d ----, 2011 WL 3659938 (Cal.App. 4 Dist. 2011), the California Court of Appeal affirmed the dismissal of a fraud claim on statute of limitations grounds. In 2005, the plaintiff sued her ex-husband, claiming he created false credit histories for their children and used those histories to refinance their mortgages with Wachovia. That case soon settled and, in 2009, the plaintiff sued Wachovia and its successor, Wells Fargo, claiming they participated in her ex-husband's fraud. Continue Reading Questions & comments
The California Court Of Appeal Again Rejects A Claim For Wrongful Foreclosure At The Pleading Stage
The recent published decision of Fontenot v. Wells Fargo Bank, N.A. (Cal.App.1 Dist., August 11, 2011) --- Cal.Rptr.3d ----. 2011 WL 3506177, adds several more arrows to a secured lender's quiver of arguments challenging wrongful foreclosure claims at the pleading stage. First, the Court explains in detail how and why publicly recorded documents can be judicially noticed to defeat contradictory allegations. Second, the Court holds MERS properly has all the authority to act on behalf of a lender or beneficiary under the terms of the agency agreement between MERS and the lender. Third, plaintiffs must plead "actual prejudice" to set aside a foreclosure sale based on irregularities in the foreclosure process. Here, even if MERS lacked authority to assist with the foreclosure, the only prejudice would be to the lender or the beneficiary, not the borrower. Fourth, if a plaintiff pleads breach of contract, it cannot also plead promissory estoppel based on that contract. If the contract claim fails, the estoppel claim must also fail. Continue Reading Questions & comments
