Case No. A139655

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT DIVISION THREE

LEIGHTON LEE PERRY,

Plaintiffs-Appellants,

v.

FEDERAL NATIONAL MORTGAGE ASSOCIATION, et al., Defendants-Respondents.

Appeal from Judgment of the California Superior Court County of Contra Costa

Honorable Laurel S. Brady, Case No. SCV0030248

BRIEF OF RESPONDENT

McCARTHY & HOLTHUS, LLP Melissa Robbins Coutts, Esq. (SBN: 246723) Charles E. Bell, Esq. (SBN: 256848) 1770 Fourth Avenue San Diego, CA 92101 Telephone: (619) 685-4800 Facsimile: (619) 685-4811 Email: cbell@mccarthyholthus.com Attorneys for Defendant and Respondent, Quality Loan Service Corporation.

CERTIFICATE OF INTERESTED PARTIES

There are no interested entities or parties to list in this certificate per

California Rules of Court, Rule 8.208(e). No entity has an ownership interest of 10% or more of Respondent.

Dated: February 6,2014 Respectfully Submitted, McCarthy & Holthus, LLP

Charles E. Bell, Esq. Attorneys for Respo (lent, Quality Loan Service Corporation

ii

TABLE OF CONTENTS

TABLE OF CONTENTS ............................................................................. ii

INTRODUCTION ......................................................................................... 1

STATEMENT OF THE CASE ..................................................................... 2

STATEMENT OF ISSUES PRESENTED ................................................... 2

STATEMENT OF FACTS ............................................................................ 2

ARGUMENT ................................................................................................. 4

I. Standard of Review .................................................................... 4

II. Perrys Opening Brief is based Upon Numerous Factual

Assertions without Citation to the Record. ................................................. 5

III. The Trial Court Properly Granted Qualitys Motion for

Summary Judgment Because the First Amended Complaint Did Not State

Any Cause of Action Against Quality. ....................................................... 6

A. The Trial Court Properly Granted Qualitys Request for

Judicial Notice in Support of its Motion for Summary Judgment ............... 6

B. The Trial Court Properly Ruled that the Notice of Default is

in Compliance with California Statute ....................................................... 8

C. The Trial Court Properly Granted Qualitys Motion for

Summary Judgment to Perrys First Cause of Action for Declaratory

Relief. 9

1. Perry Has Failed To Identify Any Actions Taken By Quality

That Are Outside The Scope Of Its Statutorily Protected Duties. ............ 10

2. The Tender Rule Bars Perrys arguments as to Wrongful

Foreclosure within the Declaratory Relief cause of action. ..................... 11

iii

IV. The Trial Courts Decision Not to Provide A Statement of

Decision is Not Reversible Error After Ruling on Defendants Summary

Judgment Motions. .................................................................................... 15

iv

TABLE OF AUTHORITIES

Cases

American Drug Stores, Inc. v. Stroh, (1992) 10 Cal.App.4th 1446, 1453 ..... 6

Baucum v. Le Baron (1955) 136 Cal.App.2d 593, 595 ................................ 17

Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 264 ......... 8

Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 264-267 . 8,

9

Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 271 ....... 10

FPCI Re-Hab 01 v. E&G Invs. (1989) 207 Cal.App.3d 1018, 1021-1022 .. 12

Gafcon, Inc. v. Ponsor & Associates, (2002) 98 Cal.App.4th 1388, 1402 ..... 5

Homestead Sav. v. Darmiento, (1991) 230 Cal. App. 3d 424, 432-33......... 15

Kachlon v. Markowitz, (2008) 168 Cal. App. 4th 316, 336 ................... 14, 16

Karlsen v. Am. Sav. & Loan Assn. (1971) 15 Cal.App.3d 112 ................... 13

Kelly v. Methodist Hosp. of So. Cal., (1996) 48 Cal.App.4th 1431, 1442 ..... 7

Lenane v. Continental Maritime of San Diego, Inc., (1998) 61 Cal.App.4th

1073, 1079 ................................................................................................... 5

Lona v. Citibank, N.A. (2011) 202 Cal.App.4th 89, 112 .............................. 12

Mills v. U.S. Bank, (2008) 166 Cal.app.4th 871, 895 ...................................... 5

Mix v. Sodd (1981) 126 Cal.App.3d 386, 390 .............................................. 17

Moeller v. Lien, 25 (1994) Cal. App. 4th 822, 834 ...................................... 15

Neighbors v. Buzz Oates Enters., (1990) 217 Cal.App.3d 325, 335 fn. 8 ...... 6

Nguyen v. Calhoun, (2003) 105 Cal.App.4th 428, 439 ................................ 13

Rubin v. Green, (1993) 4 Cal. 4th 1187, 1193-94 .................................. 14, 16

Shimpones v. Stickney (1934) 219 Cal. 637, 649 ......................................... 16

Southcott v. Pioneer Title Co. (1962) 203 Cal. App. 2d 673, 676 ............... 14

Stebley v. Litton Loan Servicing, LLP (2011) 202 Cal.App.4th 522, 526 ... 13

v

Tisher v. Cal. Horse Racing Bd. (1991) 231 Cal.App.3d 349, 361 ............... 6

Whittingon v. McKinney (1991) 234 Cal.App.3d 123 .................................. 15

Statutes

California Civil Code 2924(b) ................................................................... 10

California Civil Code 2924(d) ................................................................... 13

California Civil Code 2924 ....................................................................... 13

California Civil Code 2924(c) ................................................................... 13

California Civil Code 2920 through 2944.5 ............................................ 13

California Civil Code 2305 .......................................................................... 9

California Civil Code 2315 .......................................................................... 9

California Civil Code 2305 ......................................................................... 9

California Civil Code of Procedure 632 ..................................................... 16

California Civil Code of Procedure 634 ..................................................... 16

California Civil Code 1493 ....................................................................... 12

California Civil Code 1494 ....................................................................... 12

California Civil Code 1495 ....................................................................... 12

California Civil Code 2924(a)(1) .......................................................... 9, 14

California Civil Code 2932.5 ...................................................................... 3

California Civil Code 2924(l) ...................................................................... 4

California Civil Code 2934a ........................................................................ 3

1

INTRODUCTION

Appellant, Leighton Lee Perry (Perry), has appealed the trial

courts ruling granting the Motions for Summary Judgment filed by

Defendants Quality Loan Service Corporation (Quality) and JPMorgan

Chase Bank, N.A. (JPMorgan) and Federal National Mortgage

Association (FNMA). Perrys First Amended Complaint alleged three

causes of action against Quality -- the trustee of a pending nonjudicial

foreclosure of the subject property for declaratory relief, slander of title,

and quiet title. But Appellants Opening Brief does not address any of these

claims or the factual allegations in his complaint, instead arguing only that

the trial court erred in failing to provide a statement of decision and the trial

court did not have jurisdiction to rule in defendants favor. Besides his

conclusory and unsupported statements, he does not identify any facts that

would have changed the outcome of the Motions for Summary Judgment.

Moreover, he does not point to any facts in the First Amended Complaint or

his Oppositions to the Motion to Summary Judgments that would state a

cause of action against the Defendants.

As to Quality specifically, the First Amended Complaint failed to

state any cause of action. Quality, as trustee, is inured with specific

statutory protections that prohibit the imposition of liability for actions it

took as trustee. Notably, nowhere in the factual allegations of Perrys First

Amended Complaint, or in the record on appeal, or in Perrys Opening

Brief, does he identify any actions taken by Quality that are outside of

Qualitys statutorily-protected duties as trustee. Moreover, each of the three

claims against Quality has independent deficiencies that necessitated the

trial court granting Qualitys Motion for Summary Judgment. Thus, the trial

2

court properly granted Qualitys Motion for Summary Judgment and this

Court should affirm.

STATEMENT OF THE CASE

This appeal stems from the trial courts ruling granting the Motion

for Summary Judgments filed by Defendants Quality and JPMorgan and

FNMA to Appellants First Amended Complaint.

STATEMENT OF ISSUES PRESENTED

1. Whether Perrys First Amended Complaint failed to state a

claim upon which relief could be granted against Quality.

2. Whether the trial court properly exercised its discretion in

granting the Motion for Summary Judgment filed by Defendants Quality to

the First Amended Complaint.

STATEMENT OF FACTS

Perry filed his initial complaint in Contra Costa Superior Court on

October 14, 2010, asserting various claims related to the pending

nonjudicial foreclosure of the property located at 6724 Waverly Road,

Martinez, CA 94553 (Subject Property). (1 AA 48; 53:7.) In 1988, the

Subject Property was encumbered by a Deed of Trust securing a

$130,000.00 loan that Perry borrowed from All Valley Financial

Corporation, a California Corporation. (1 AA 54:15-20; 209-214.) An

Assignment of Deed of Trust was recorded on July 29, 1991, under which

All Valley Financial Corporation, a California Corporation, assigned all

beneficial interest under the Deed of Trust to FNMA. (1 AA 122; 217.)

3

On October 23, 2008, FNMA executed a Limited Power of Attorney,

making McCarthy & Holthus, LLP its true and lawful Attorney-in-Fact,

and in its name, place and stead and for its use and benefit, to do all things,

and execute all documents, necessary and appropriate to conduct, or vacate,

foreclosure proceedings in the State of California. (1 AA 295.)

An Assignment of Deed of Trust was executed by FNMA, through

its Attorney-in-Fact McCarthy & Holthus, LLP, on August 25, 2010 and

recorded on August 30, 2010, under which all beneficial interest under the

Deed of Trust was assigned to JPMorgan. (1 AA 89; 263.)

On September 16, 2010, JPMorgan executed a Substitution of

Trustee, whereby Quality was substituted as trustee under the Deed of Trust

in place of the original trustee. (1 AA 90-91; 267-268.)

Perry defaulted on his loan and a nonjudicial foreclosure was

initiated by the recording of a Notice of Default in the Contra Costa County

Recorders Office. (1 AA 259-260.)

Due to Perrys continued default, Quality recorded a Notice of

Trustees Sale on September 28, 2010. (1 AA 271-272.)

On July 29, 2011, Perry filed a First Amended Complaint asserting

six causes of action for: (1) Declaratory Relief; (2) Slander of Title; (3)

Quiet Title; and (4) Violation of California Civil Code 2943. (1 AA 49-

80.) Perry alleged only three causes of action against Quality: the first

cause of action for Declaratory Relief; the second cause of action for

Slander of Title; and third cause of action for Quiet Title. (Id.) Initially,

Quality filed a Declaration of Non-Monetary Status pursuant to California

Civil Code 2924l, stating that it agreed to be bound to any non-monetary

judgment of the court. (1 AA 46.) When Perry objected to the Declaration

4

of Non-Monetary status, Quality filed a demurrer to the First Amended

Complaint. (1 AA 45.) On March 1, 2012, Qualitys demurrer the First

Amended Complaint was overruled and Quality was directed to file an

Answer. (1 AA 43.) Perry demurred to Qualitys Answer, but the demurrer

was overruled. (1 AA 40.)

On January 29, 2013, Quality filed its Motion for Summary

Judgment and the motion was set to be heard on May 2, 2013. (1 AA 39.)

On February 6, 2013, Perry filed a Motion to Compel Production of

Documents and Further Responses to Admissions and Interrogatories

against Quality. (1 AA 38.) On April 26, 2013, the trial court ruled on the

Perrys Motion to Compel, finding Qualitys favor. (1 AA 36.)

On May 23, 2013, Qualitys Motion for Summary Judgment came

before the trial court. (1 AA 24-32.) After review of the pleadings and oral

argument the trial court sustained its tentative ruling and granted Qualitys

Motion for Summary Judgment. (1 AA 24-32.) On July 9, 2013, the trial

court executed Qualitys proposed order granting judgment in Qualitys

favor. (1 AA 24-32.)

Perry has appealed the trial courts order. (1 AA 1-6.)

ARGUMENT

I. Standard of Review

The standard of review of a decision to grant or deny a motion for

summary judgment or summary adjudication is de novo. Mills v. U.S. Bank,

(2008) 166 Cal.App.4th 871, 895. The Court will apply the same rules and

standards which govern a trial courts determination of a motion for

summary judgment to determine whether there is a triable issue as to any

5

material fact and whether the moving party is entitled to judgment as a

matter of law. Id.; Lenane v. Continental Maritime of San Diego, Inc.,

(1998) 61 Cal.App.4th 1073, 1079. And the Court is not bound by the trial

courts reasoning for the ruling on the motion, rather the court only reviews

the trial courts ruling and not its rationale. Id.; Gafcon, Inc. v. Ponsor &

Associates, (2002) 98 Cal.App.4th 1388, 1402.

II. Perrys Opening Brief is based Upon Numerous Factual Assertions without Citation to the Record.

Perrys Opening Brief makes factual assertions without citation to

the record. (See generally Opening Brief.) [S]tatements of fact contained

in the briefs which are not supported by the evidence in the record must be

disregarded. Tisher v. Cal. Horse Racing Bd. (1991) 231 Cal.App.3d 349,

361. Therefore, all factual assertions in Perrys Opening Brief which are

not supported by the evidence in the record must be disregarded.

It would be improper for Perry to attempt to address the deficiencies

identified above in his reply brief. It is a universal rule of appellate

procedure that, without good cause shown, the appellate court will not

consider any new issues in the reply brief which were not discussed in the

appellants opening brief. See, e.g., Neighbors v. Buzz Oates Enters., (1990)

217 Cal.App.3d 325, 335 fn. 8; American Drug Stores, Inc. v. Stroh, (1992)

10 Cal.App.4th 1446, 1453; Kelly v. Methodist Hosp. of So. Cal., (1996) 48

Cal.App.4th 1431, 1442. This Court should not consider any attempt by

Perry to address the above deficiencies in his reply brief.

6

III. The Trial Court Properly Granted Qualitys Motion for Summary Judgment Because the First Amended Complaint Did Not State Any Cause of Action Against Quality.

Perrys Opening Brief presents a number of arguments that have no bearing

to the fundamental issue in this appeal: whether there was any genuine

dispute as to the material facts that would prevent Defendants from

obtaining summary judgment. For instance, he contends the trial court

lacked jurisdiction to grant summary judgment because Defendants raised

new arguments concerning federal law preemption in their reply brief.

(Opening Br. pg. 13-14, 39, 44.) Notably, this contention does not relate to

Quality Loan Service, as Quality did not rely on federal preemption to

support its motion. Additionally, Perry disputes the trial courts rulings on

earlier discovery motions and the reference to a discovery facilitator.

(Opening Br. pg. 6, 33, 40, 44.) None of these contentions demonstrate the

existence of a genuine dispute as to the material facts as to Quality Loan

Service that would undermine the summary judgment ruling. As discussed

below, Perry failed to plead facts or present evidence that would support

any cause of action against Quality. Accordingly, this Court should affirm.

A. The Trial Court Properly Granted Qualitys Request for Judicial Notice in Support of its Motion for Summary Judgment

Judicial notice is the recognition and acceptance by the court, for

use by the trier of fact or by the court, of the existence of a matter of law or

fact that is relevant to an issue in the action without requiring formal proof

of the matter. Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th

256, 264. It is established that a court may take judicial notice of the fact of

7

a documents recordation, the date the document was recorded and

executed, the parties to the transaction reflected in a recorded document,

and the documents legally operative language, assuming there is no

genuine dispute regarding the documents authenticity. Id. at 266. From

this, the court may deduce and rely upon the legal effect of the recorded

document, when that effect is clear from its face. Id.

Here the Court granted Qualitys Request for Judicial Notice citing

to Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 264-

267. (1 AA 27:11-13.) The Court went further and also provided parties

with an explanation as to its basis for granting the Request for Judicial

notice and overruling Perrys numerous evidentiary objections. (1 AA

27:27-28; 28:1-28; 29:1-2.) In response to Perrys Evidentiary Objection

numbers 3-6 (1 AA 373:2-24) to Qualitys Request for Judicial Notice, the

Court stated the following: Plaintiffs arguments go to the weight or legal

significance of the evidence, and not to its admissibility. (1 AA 28:22-24.)

The Court made clear that it was not judicially noticing the truth of the

contents within the recorded documents as Perry argues, but rather that it

was properly limiting its ruling as to the admissibility of the recorded

documents, which is well within the Courts powers. Fontenot v. Wells

Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 264-267. Therefore, Perrys

assertion that the Court decision in granting Qualitys Request for Judicial

Notice fails in its entirety and should be disregarded.

8

B. The Trial Court Properly Ruled that the Notice of Default is in Compliance with California Statute

Perry argues that the Court erred in its determination that there is no

genuine dispute as to whether the Notice of Default is void. (Opening

Brief, pg. 21.) Perry does not to cite to or make one reference to the

Courts order. (Id. at 21-28.) Instead Perry references the Courts prior

ruling on Qualitys Demurrer to the First Amended Complaint, as his basis

that the court had already made a decision as to the Notice of Defaults

validity. (Id. at 23.) However, simple review of the order explains that

while the court had overruled Qualitys Demurrer to the First Amended

Complaint, it had not made a binding determination that the notice of

default was void, as repeatedly argued by Perry. (1 AA 31:3-4.)

In light of this fact, Perry proceeds to argue[] that with respect to

the deed of trust loans under Stockwell, on which Calvo relied, only the

trustee holds the power to foreclose. (Opening Brief, pg. 24) As with

many of his arguments, Perry fails to realize that California law does not

require the Notice of Default to be executed or recorded only by the trustee

under the Deed of Trust. As discussed in the courts order, Qualitys

recording of the Notice of Default prior to it being formally substituted in

as Trustee under the Deed of Trust is not a procedural irregularity under

California law. (1 AA 31:6-13.) California Civil Code 2924(a)(1)

specifically lists the individuals who are authorized to record the notice of

default, which includes the trustee or an agent of the beneficiary. Here, the

Notice of Default was executed by Quality as agent for the beneficiary. (1

AA 259-260.)

9

Perry also argues that the trial court failed to address the alleged

issues surrounding the agency relationship between Quality and other

parties in the action. (See Opening Brief, pg. 25.) Specifically, that Quality

is not named on any document establishing an agency relationship. (Id.)

But, Perry disregards California Civil Code 2315 which provides that an

agent has such authority as a principal confers on the agent. Fontenot v.

Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 271. And an agent

can be authorized to do any act the principal may do. Id.; California Civil

Code 2305, California Civil Code 2305. JPMorgan had the authority to

execute the Notice of Default as beneficiary under the Deed of Trust,

Quality as its agent was also authorized to do so. Further, JPMorgan has

never alleged that Qualitys actions were not carried out as its agent and it

is the only one with standing to assert that Qualitys actions were not

authorized. Therefore, Perrys claims regarding the Courts ruling on the

Notice of Default fail and the Courts ruling should be affirmed.

C. The Trial Court Properly Granted Qualitys Motion for Summary

Judgment to Perrys First Cause of Action for Declaratory Relief.

Perrys first cause of action for Declaratory Relief is based upon his

allegation that the defendants did not have authority to foreclose on the

Subject Property. (1 AA 61:7-28; 62:1-28; 63:1-28; 64:1-13.) However,

Perrys allegations even if true would not impose liability upon Quality,

the foreclosure trustee.

10

1. Perry Has Failed To Identify Any Actions Taken By Quality That Are Outside The Scope Of Its Statutorily Protected Duties.

It has long been established that a trustee under a Deed of Trust,

such as Quality, has no personal interest in the properties upon which it

forecloses, and instead its limited role is to conduct a nonjudicial sale in the

event of the borrowers default, or to reconvey title to the property once the

debt is satisfied. Ainsa v. Mercantile Trust Co. (1917) 174 Cal. 504, 510.

As a result of its limited role the trustee shall incur no liability for any

good faith error resulting from reliance on information received in good

faith from the beneficiary regarding the nature and the amount of the

default under the secured obligation, deed of trust, or mortgage. California

Civil Code 2924(b). Therefore, regardless of Perrys standing allegations,

Quality will incur no liability for its reliance upon the information it

received from the beneficiary regarding the secured obligation.

Further, both the First Amended Complaint and Perrys Opening

Brief fail to allege any actions taken by Quality which were outside its

statutory protected trustee duties. Indeed the First Amended Complaint

alleges only that Qualitys was not the trustee at the time the foreclosure

was initiated. (See 1 AA 61:7-28; 62:1-28; 63:1-28; 64:1-13.) However,

Perry identified no wrongful actions taken by this Defendant. Therefore,

Perry has failed to identify how the trial court erred in granting Qualitys

Motion for Summary Judgment as to Perrys first cause of action for

Declaratory Relief.

11

2. The Tender Rule Bars Perrys arguments as to Wrongful Foreclosure within the Declaratory Relief cause of action.

There is a maxim in the context of foreclosures known as the tender

rule. An action to set aside a foreclosure rests in equity. Consequently, a

defaulted borrower seeking to set aside a foreclosure sale cannot state a

claim without alleging tender of the outstanding debt that is owed, or at

least tender of the full amount required to cure her default. Lona v.

Citibank, N.A. (2011) 202 Cal.App.4th 89, 112. Without alleging facts

showing a complete and valid tender, the plaintiff cannot demonstrate any

prejudice suffered by any irregularities in the foreclosure sale. FPCI Re-

Hab 01 v. E&G Invs. (1989) 207 Cal.App.3d 1018, 1021-1022. The

rationale behind the rule is that if plaintiffs could not have redeemed the

property had the sale procedures been proper, any irregularities in the sale

did not result in damages to the plaintiffs. Id at 1022. Likewise,

[a]llowing plaintiffs to recoup the property without full tender would give

them an inequitable windfall, allowing them to evade their lawful debt.

Stebley v. Litton Loan Servicing, LLP (2011) 202 Cal.App.4th 522, 526.

A valid tender must be an unconditional offer of performance

(California Civil Code 1494), made in good faith and in such a manner as

is most likely to benefit the creditor (California Civil Code 1493), by a

person able and willing to perform (California Civil Code 1495). The

tender rule is strictly applied, Nguyen v. Calhoun, (2003) 105 Cal.App.4th

428, 439, and absent an alleged and actual tender, the First Amended

Complaint in its entirety fails to state a cause of action. Karlsen v. Am. Sav.

& Loan Assn. (1971) 15 Cal.App.3d 112. Perry has not tendered, nor has

he made an unconditional offer to tender, the full amount owing on the

12

loan. Without such a payment, he has no standing to challenge the

foreclosure sale or to bring any of his other implicitly integrated claims.

There are exceptions to the tender rule; however, Perry did not plead

any facts in his First Amended Complaint that would render any of the

exceptions applicable in the present case. Also, Perrys Opening Brief

failed to identify a single fact alleged in the First Amended Complaint or

that he could allege to support an exception to the tender rule. Therefore,

the tender rule bars Perrys wrongful foreclosure claims within his

declaratory relief cause of action.

D. The Trial Court Properly Granted Qualitys Motion for Summary

Judgment to Perrys Second Cause Of Action For Slander of Title.

Slander of Title is an unprivileged or malicious publication of a false

statement that disparages plaintiffs title to real property and causes

pecuniary loss. . Kachlon v. Markowitz, (2008) 168 Cal. App. 4th 316, 336;

Rubin v. Green, (1993) 4 Cal. 4th 1187, 1193-94; Southcott v. Pioneer Title

Co. (1962) 203 Cal. App. 2d 673, 676.

Perry asserts that Quality is liable for Slander of Title based on the

recording of non-judicial foreclosure documents against the subject

property. (See 1 AA 64:14-28; 65:1-23.) But executing and recording a

Notice of Default and Notice of Sale in accordance with California Civil

Code 2924(c) are privileged actions, and accordingly, cannot subject

Quality to liability.

The California Legislature has codified the manner and procedure

for conducting non-judicial foreclosures in the California Civil Code

2920 through 2944.5. These sections comprise a comprehensive regulation

13

of the non-judicial foreclosure process by the legislature. Moeller v. Lien,

25 (1994) Cal. App. 4th 822, 834; see also Homestead Sav. v. Darmiento,

(1991) 230 Cal. App. 3d 424, 432-33. In recognizing the importance of

non-judicial foreclosure procedures, the legislature has extended the

litigation privilege to encompass performance of any of the procedures

involved in a non-judicial foreclosure.

California Civil Code 2924 states: The mailing, publication, and

delivery of notices as required herein, and the performance of the

procedures set forth in this article, shall constitute privileged

communications within 47. California Civil Code 2924(d). This

includes the recording of a notice of default under 2924(a)(1 by a trustee,

mortgagee, beneficiary, or any of their authorized agents. The California

Civil Code 2924(a)(1) specifically lists the individuals who are authorized

to record the notice of default, which includes the trustee or an agent of the

beneficiary. Here, the Notice of Default was executed by Quality as agent

for the beneficiary. (1 AA 259-260.) The effect of the litigation privilege

is to bar any tort action based on a protected communication. The only

exception is for suit based on malicious prosecution. Kachlon v. Markowitz,

(2008) 168 Cal. App. 4th 316, 336; Rubin v. Green, (1993) 4 Cal. 4th 1187,

1193-94 Thus, Perrys action for slander of title based on the recordation

of the Notice of Default and Notice of Sale is barred by the litigation

privilege. Kachlon v. Markowitz, (2008) 168 Cal. App. 4th 316, 336; Rubin

v. Green, (1993) 4 Cal. 4th 1187, 1193-94.340-41. Accordingly, Perry has

failed to identify how the trial court erred in granting Qualitys Motion for

Summary Judgment as to Perrys Second Cause of Action.

14

E. The Trial Court Properly Granted Qualitys Motion for Summary Judgment to Perrys Third Cause of Action for Quiet Title.

Perrys third cause of action for Quiet Title also fails as a matter of

law. (1 AA 65:24-28; 66:1-28; 67:1-28; 68:1-28; 69:1-3.) Foremost, Perry

does not have standing to assert a cause of action for Quiet Title. A

mortgagor cannot maintain a Quiet Title cause of action against the

mortgagee without paying the debt secured. Shimpones v. Stickney (1934)

219 Cal. 637, 649; see also Mix v. Sodd (1981) 126 Cal.App.3d 386, 390

(no quite title action may lie without paying the debt, even if the debt is

otherwise unenforceable, because a court of equity will not a aid a person in

avoiding the payment of his or her debts). It is undisputed that Perry has

not tendered the principal balance on the loan. Accordingly, Perry is

unable to state a claim for Quiet Title.

The purpose of pursuing a Quiet Title action is to have conflicting

claims against an interest in property settled. Baucum v. Le Baron (1955)

136 Cal.App.2d 593, 595. However, as discussed above, a Trustee has no

claim to ownership of the property and is simply a common agent for

purposes of either foreclosing or reconveying title upon payment of the

debt. Ainsa v. Mercantile Trust Co. (1917) 174 Cal. 504, 510. Perrys third

cause of action for Quiet Title must fail as to Quality because Quality has

no claim to the Subject Property.

Perry has failed to allege in his First Amended Complaint or discuss

in his Opening Brief how he can maintain a cause of action for Quiet Title

against Quality. Therefore, Perry has failed to identify how the trial court

erred in granting Qualitys motion for summary judgment to the third cause

of action for Quiet Title.

15

IV. The Trial Courts Decision Not to Provide A Statement of Decision is Not Reversible Error After Ruling on Defendants Summary Judgment Motions.

On a hearing on a motion for summary judgment, the court is

without power to make findings of fact. Perry v. Farley Bros. Moving &

Storage, Inc. (1970) 6 Cal.App.3d 884, 889. Under such circumstances, it

is the duty of the trial court to determine whether plaintiff or defendant has

presented any facts which give rise to a triable issue or defense, not to pass

upon or determine the issue itself. Id.

Perry contends that the trial court committed reversible error bynot

providing a statement of decision based on an inaccurate interpretation of

California Code of Civil Procedure. Specifically, Perry cites to California

Code of Civil Procedure 632, California Code of Civil Procedure 634

and to Whittingon v. McKinney (1991) 234 Cal.App.3d 123, in support of

his claim. (See Opening Brief pgs. 42-43). However, Perry ignores the

simple fact that these authorities apply to bench trials and do not apply to

motion for summary judgment hearings. As discussed above, courts have

found that a trial court has no power to issue findings of fact when ruling

on a motion for summary judgment. Perry v. Farley Bros. Moving &

Storage, Inc. (1970) 6 Cal.App.3d 884, 889. Unlike in Whittingon v.

McKinney, the trial court provided parties with a detailed tentative ruling

explaining the basis for its findings and further instructed the prevailing

party to draft a proposed order identical to the courts tentative ruling. (1

AA 26-32.) Most importantly, the court did not execute the final order on

the motions for summary judgment until after the proposed order was

approved as to form by Perry. (1 AA 32) Therefore, Perry cannot argue

that the trial court failed to provide him with the basis for its decision or

that Perry was not aware of the court's reasoning as provided in the

proposed order, which he himself approved. Thus, Perry has failed to

provide any basis to support a claim for reversible error concerning the trial

court's decision not to provide a statement of decision. CONCLUSION

For the foregoing reasons, the Court should affirm the judgment of the trial, court granting Defendant Quality Loan Service Corporation's motion for summary judgment.

Dated: February 6,2014

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Respectfully Submitted, McCarthy & Holthus, LLP

Charles E. Bell, Esq. Attorney for Respon nt, Quality Loan Service Corporation

CERTIFICATE OF WORD COUN'f

(California Rules of Court, Rule 8.204)

The undersigned certifies that this Brief was prepared in Times New

Roman size 13 font. The text of this Brief contains 4,186 words (exclusive of the tables and other items exempted from the word count by Rule

8.204(c)(3)), as counted by the Microsoft Word 2007 word-processing program used to generate the document.

Dated: February 6,2014

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PROOF OF SERVICE

I, Karen Ann Rincon, declare as follows:

I am employed in the County of San Diego, State of California. I am over the age of eighteen (18) years and not a party to this action. My business address is 1770 Fourth Avenue, San Diego, California 92101.

On February 6, 2014, I served a true and correct copy of the foregoing document, titled: BRIEF OF RESPONDENT, by U.S. First Class Mail to the following persons:

Leighton Lee Perry 6724 Waverly Road Martinez, CA 94553

John D. Ives, Esq. SEVERSON & WERSON One Embarcadero Center, Suite 2600 San Francisco, CA 94111

Contra Costa County Superior Court Attn: Hon. Laurel S. Brady 725 Court Street Department 5 Martinez, CA 94553

Supreme Court of California 350 McAllister Street San Francisco, CA 94102

I placed a true copy in a sealed envelope addressed as indicated above. I am readily familiar with the firm's practice of collection and

processing correspondence for mailing. It is deposited with the U.S. Postal Service on that same day in the ordinary course of-business. I am aware

that on a motion of party served, service is presumed invalid if postal

cancellation date or postage meter date is more than one date after date of ---------------------t

I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Executed on February 6,

2014, at San Diego, California.

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