Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_10-cv-01838/USCOURTS-casd-3_10-cv-01838-2/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 28:1331(a) Fed. Question: Real Property

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1 10cv1838 BTM

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

PAUL R. CASTILLO,

Plaintiff,

Case No. 10cv1838 BTM

ORDER DENYING PLAINTIFF’S

MOTION FOR WAIVER OF

SECURITY PAYMENTS

v.

JOHN SKOBA, Vice President of Aurora

Loan Services, LLC, et al.,

Defendants.

On October 8, 2010, the Court granted Plaintiff’s motion for a temporary restraining

order. (Dock. 14) In order for this injunction to remain in effect, the Court ordered Plaintiff

to deposit with the Clerk of the Court monthly security payments of $2,452.52, representing

the regular monthly payments that are owed on the note, which is secured by the deed of

trust. Plaintiff now moves to have this requirement to post security payments waived or to

have payments set at a nominal amount. For the reasons that follow, this motion is DENIED.

In its October 8 Order, the Court stated that it would entertain motions to adjust the

security payment if $2,452.42 does not reflect the current monthly payments that Plaintiff

owes on the property. Plaintiff does not challenge the amount of payment on this ground.

Instead, Plaintiff argues that because he is indigent, he should be excused, altogether, from

the Fed. R. Civ. P. 65(c) requirement that he must post a security payment in order for the

court to issue a temporary restraining order.

Although the Court may have discretion to waive the security requirement, see V.L.

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1

 Plaintiff’s argument that MERS did not have the authority to assign the beneficial

interest lacks merit. (See Order RE Motion For Temporary Restraining Order, Dock. 4 at 2;

see also Benham v. Aurora Loan Services, No. C-09-2059, 2009 WL 2880232, at *3 (N.D.

Cal. Sept. 1, 2009) (“[A]s the beneficiary under the Deed of Trust, it is clear that MERS. . .

had the authority to assign its beneficial interest.”); Wurtzberger v. Resmae Mortg. Corp., No.

09-cv-01718, 2010 U.S. Dist. LEXIS 51751, at *9 (E.D. Cal. Apr. 29, 2010) (same); Pok v.

Am. Home Mortg. Servicing, Inc., No. 2:09-2385, 2010 U.S. Dist. LEXIS 9016, at *9-10 (E.D.

Cal. Feb. 2, 2010) (same); Castaneda v. Saxon Mortg. Servs., 687 F. Supp. 2d 1191 (E.D.

Cal. 2009) (same); Waqavesi v. Indymac Fed. Bank, FSB, No. 09-01601, 2009 U.S. Dist.

LEXIS 105555, at *11 (E.D. Cal. Nov. 11, 2009) (same); Baisa v. Indymac Fed. Bank, No.

09-1464, 2009 U.S. Dist. LEXIS 103444, at *8-9 (E.D. Cal. Nov. 5, 2009) (same))

2

 This document was received with discrepancies and was filed nunc pro tunc on

October 18, 2010.

2 10cv1838 BTM

v. Wagner, 669 F. Supp. 2d 1106, 1123 (N.D. Cal. 2009), the Court declines to do so here

because neither the equities nor the public interest favors allowing Plaintiff to live rent-free

until the termination of his case. Plaintiff retains an independent, contractual obligation to

repay his mortgage loan. The Court set his security payment at the same amount as would

be required to fulfill this obligation, and thus, the Court does not impose a new burden on

Plaintiff in exchange for entering a temporary restraining order. 

Defendants, on the other hand, would likely face pecuniary harm if Plaintiff is not

obligated to post bond because of their ultimate ability to exercise power of sale over

Plaintiff’s property. Although it appears that neither Aurora nor Cal-Western had authority

to initiate the foreclosure sale at the time the Notice of Default was entered, documents

indicate that as of June 8, 2010, Cal-Western had been substituted as trustee under the deed

of trust (Exh. 4) and Aurora had been assigned MERS’ beneficial interest (Exh. 6).

Accordingly, it is likely that Defendants currently have authority to enter a Notice of Default,

which triggers statutory requirements that eventually lead to foreclosure sale.1

 See Cal. Civ.

Code § 2924; § 2924b(b)(2); § 2924f(b); § 2924g(a). Thus, even if the Notice of Default at

issue in this case is void ab initio, Defendants would not be permanently precluded from

conducting a foreclosure sale if Plaintiff’s default is not cured and Defendants comply with

statutory requirements governing nonjudicial foreclosures. The Court rejects Plaintiff’s

attempt to live rent-free until that date.

In light of the fact that Plaintiff’s motion to waive the security deposit was received on

October 14, 20102

–one day before the first security payment was due, the court hereby

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3 10cv1838 BTM

revises its October 8 Order to allow first payment of Plaintiff’s bond to be made on October

25, 2010. All other language in this Order is unchanged. As before, in order for the

temporary restraining order or, if appropriate, a preliminary injunction to remain in effect,

Plaintiff must deposit with the Clerk of the Court monthly payments of $2,452.42 on the

fifteenth of the month or the first business day after if the fifteenth falls on a weekend or court

holiday (as noted above, first payment will be made on October 25; payments on the fifteenth

of the month will begin in November). If Plaintiff fails to post the security within the required

time, Defendants may file a notice notifying the Court of Plaintiff’s failure to comply.

IT IS SO ORDERED.

DATED: October 21, 2010

Honorable Barry Ted Moskowitz

United States District Judge

Case 3:10-cv-01838-BTM-WMC Document 20 Filed 10/21/10 Page 3 of 3