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Real Estate
Foreclosure
Declaration of Invalidity of Foreclosure Sale

Jeffrey Swartz v. Nationstar Mortgage LLC; JP Morgan Chase Bank, N.A.; NBS Default Services, LLC; TFLG, A Law Corporation, and Does 1 through 10

Published: Aug. 1, 2015 | Result Date: Feb. 26, 2015 | Filing Date: Jan. 1, 1900 |

Case number: 2:14-cv-08649-BRO-JC Bench Decision –  Dismissal

Court

USDC Central


Attorneys

Plaintiff

Timothy L. McCandless

Stephen R. Golden
(Stephen R. Golden & Associates)


Defendant

Sharon K. Brown

Wendy L.R. Miele

Frances M. O'Meara
(Freeman, Mathis & Gary LLP)


Facts

Jeffrey Swartz sued Nationstar Mortgage LLC, JP Morgan Chase Bank N.A, NBS Default Services LLC, and TFLG ALC, in connection with the foreclosure of his property.

Contentions

PLAINTIFF'S CONTENTIONS:
Plaintiff owned the subject property located in Altadena and owed Chase $540,000, which was secured by the subject property. He defaulted on his loan, prompting Chase to commence foreclosure proceedings. Chase later transferred its interest on the note to Nationstar and later filed a notice of trustee sale. Plaintiff requested a modification of his loan, but was unable to obtain one. Thereafter, plaintiff filed for chapter 13 bankruptcy. The next day, Nationstar sold the subject property to plaintiff in a non-judicial foreclosure trustee sale. At that point, the subject property became the property of his bankruptcy estate. Defendants then recorded the sale and became record owners of the property. Defendants subsequently rescinded the trustee's sale a few months later and TFLG subsequently initiated eviction proceedings. Plaintiff alleged, among other things, that defendants wrongfully foreclosed on his property and that defendants violated the bankruptcy court's automatic stay.

Plaintiff asserted claims for wrongful foreclosure, damages for willful violation of the automatic stay, declaration of invalidity of foreclosure sale based on the violation of the automatic stay, and declaration of invalidity and rescission of sale based on the failure to comply with foreclosure laws.

DEFENDANTS' CONTENTIONS:
Defendants filed separate motions to dismiss the complaint for failure to state a claim for relief. Chase contended, among other things, that plaintiff's wrongful foreclosure claim failed because he failed to allege tender of the indebted amount. Defendants also argued that the claim was moot because Nationstar had rescinded the foreclosure sale. TLFG disclaimed any connection with the allegedly wrongful foreclosure proceedings.

Result

Ultimately, the court granted defendants' motion to dismiss in its entirety. Swartz' wrongful foreclosure claim was dismissed with prejudice while his other claims were dismissed for lack of subject matter jurisdiction. Moreover, the court denied Swartz's request for leave to amend.


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