Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_09-cv-01942/USCOURTS-caed-1_09-cv-01942-3/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 15:1601 Truth in Lending

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IN THE UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

RACHEL PACRAY, )

)

)

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Plaintiff, )

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vs. )

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SHEA MORTGAGE, INC., et al., )

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Defendants. )

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No. CV-F-09-1942 OWW/GSA

MEMORANDUM DECISION AND

ORDER DENYING PLAINTIFF'S

MOTION FOR RECONSIDERATION

(Doc. 37)

By Memorandum Decision and Order filed on April 23, 2010,

(April 23 Memorandum Decision, Doc. 31), Defendants’ motions to

dismiss the First Amended Complaint were granted as to the First,

Second and Third Causes of Action with prejudice and without

leave to amend. The motions to dismiss were granted with leave

to amend as to the Fourth Cause of Action. The Fourth Cause of

Action was captioned “Cancellation of Instrument” and alleged:

54. A written instrument that purports to be

a Deed of Trust executed by plaintiff is

presently in existence and under ALS’s

control.

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55. The instrument, although apparently

valid on its face, is voidable in that there

is no enforceable underlying promissory note

for the deed of trust to secure.

56. As a result, any obligation owed by

PARCRAY to ALS is not secured by the

underlying real property.

57. By this complaint, plaintiffs [sic]

notify ALS of plaintiff’s intent to cancel

the deed of trust attached as Exhibit A.

In dismissing the Fourth Cause of Action with leave to amend, the

Court ruled:

Defendants assert that the allegation that

there is “no enforceable underlying

promissory note for the deed of trust to

secure” is conclusory and contradicted by the

allegation in Paragraphs 5 and 19 that

“Plaintiff purportedly entered into a loan

repayment and security agreement on or about

December 1, 2006 with Defendant SHEA ...,

which required Plaintiff to repay a loan of

$462,550.00 to SHEA” and “Plaintiff is

willing and able to tender the face value of

the note minus equitable set off to the true

holder of the underlying promissory note whom

plaintiff believes to be Shea Mortgage.”

It is apparent that Plaintiff’s allegation in

the Fourth Cause of Action is based on the

premise that the original promissory note

must be produced before a non-judicial

foreclosure can proceed. As noted, Plaintiff

now concedes that this contention is without

legal merit. See, e.g., Chilton v. Federal

Nat. Mortg. Ass’n, 2009 WL 5197869 (E.D.Cal.,

Dec. 23, 2009) and cases cited therein.

California Civil Code § 3412 provides:

A written instrument, in respect to

which there is a reasonable

apprehension that if left

outstanding it may cause serious

injury to a person against whom it

is void or voidable, may, upon his

application, be so adjudged, and

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ordered to be delivered up or

cancelled.

Defendants assert that the FAC fails to

establish that the Deed of Trust is void or

voidable, or that the Deed of Trust must be

cancelled to avoid serious injury to

Plaintiff. The foreclosure sale occurred on

July 8, 2009, before this action was

commenced. Therefore, Defendants contend,

Plaintiff is no longer obligated to make

payments under the promissory note or Deed of

Trust. In addition, in order to cancel a

voidable instrument, Plaintiff must restore

to the beneficiary the amounts she borrowed

pursuant to the promissory note and Deed of

Trust. See Star Pacific Investments, Inc. v.

Oro Hills Ranch, Inc., 121 Cal.App.3d 447,

457 (1981). Defendants assert that Plaintiff

has not repaid or offered to repay the amount

loaned. See discussion supra.

The Fourth Cause of Action is DISMISSED WITH

LEAVE TO AMEND to state equitable or legal

grounds for the claim for cancellation of

instrument within the purview of Rule 11,

Federal Rules of Civil Procedure. If

Plaintiff proceeds to amend the Fourth Cause

of Action, Plaintiff must allege the tender

of the loan amount or the present ability to

tender the loan amount.

...

2. Plaintiff shall file a Second Amended

Complaint within fifteen (15) days of

electronic service of this Memorandum

Decision and Order. Failure to timely comply

will result in the dismissal of this action

....

Plaintiff did not file a Second Amended Complaint and Judgment of

dismissal was entered on May 27, 2010. (Doc. 36). 

On July 28, 2010, Plaintiff, now proceeding in pro per,

filed a Motion for Reconsideration. Plaintiff’s motion is

supported by her declaration:

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3. I have facts and circumstances which

resulted in this adverse ruling that I would

like the Court to consider in granting this

motion. I was unable to meet the deadline

given to file a second amended complaint due

to the chaos in my personal life. First, I

was dealing with the impending foreclosure of

my home. Second, I was self-represented due

to the fact that I lost my life savings which

I invested in my home and therefore was

unable to afford an attorney.

4. I intended on amending my complaint as

instructed by the Court, however the

financial stress I was experiencing along

with looking for a new home unfortunately

consumed all my emotional and physical

energy. I have been adversely affected by

the Court’s decision to dismiss all claims

against the Defendants in this case.

5. Due to the grave injustice that I would

suffer should I be denied the opportunity to

present my case before the Court, I

respectfully request leave to amend my

complaint and proceed with this case on its

merits.

In support of her motion for reconsideration, Plaintiff

cites and relies on California Code of Civil Procedure § 1008. 

California Code of Civil Procedure has no application to

Plaintiff’s motion because federal courts must apply federal

procedural rules. See Clark v. Allstate Ins. Co., 106 F.Supp.2d

1016, 1018-1019 (S.D.Cal.2000). Plaintiff’s motion for

reconsideration is governed by Rule 60(b), Federal Rules of Civil

Procedure. Rule 60(b) provides:

On motion and just terms, the court may

relieve a party or its legal representative

from a final judgment, order, or proceeding

for the following reasons:

(1) mistake, inadvertence, surprise, or

excusable neglect;

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(2) newly discovered evidence that, with

reasonable diligence, could not have been

discovered in time to move for a new trial

under Rule 59(b);

(3) fraud (whether previously called

intrinsic or extrinsic), misrepresentation,

or misconduct by the opposing party;

(4) the judgment is void;

(5) the judgment has been satisfied, released

or discharged; it is based on an earlier

judgment that has been reversed or vacated;

or applying it prospectively is no longer

equitable; or

(6) any other reason that justifies relief.

Given Plaintiff’s declaration, the merits of her motion for

reconsideration is governed by Rule 60(b)(1) and (b)(6).

As noted, Rule 60(b)(1) allows a court to relieve a party

from a final judgment because of “mistake, inadvertence,

surprise, or excusable neglect.” Such a motion must be made

within a reasonable time, not more than one year after the

judgment was entered. Here, Plaintiff’s motion is timely, but

she fails to establish that her failure to comply with the April

23 Memorandum Decision was due to mistake, inadvertence, surprise

or excusable neglect. Plaintiff’s declaration makes clear that

she did not comply with the April 23 Memorandum Decision because,

due to personal issues, she chose not to do so for personal and

emotional reasons. Plaintiff’s averments that she was unable to

afford counsel is belied by the fact that she was represented by

counsel, Marc E. Visenat, throughout the pendency of this

litigation. No withdrawal of counsel has been sought or ordered

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after a valid motion to withdraw counsel of record. Her averment

that she was unable to comply with the April 23 Memorandum

Decision because she was dealing with the “impending foreclosure”

of her home is contradicted by the fact, admitted at the hearing

on the motions to dismiss, that Plaintiff’s home had been

foreclosed on July 8, 2009, before Plaintiff commenced this

action on August 24, 2009 in the Stansilaus County Superior

Court. 

“A motion brought under Rule 60(b)(6) must be based on

grounds other than those listed in the preceding clauses ...

Clause 60(b)(6) is residual and ‘must be read as being exclusive

of the preceding clauses.’ In addition, the clause is reserved

for “extraordinary circumstances.’” Lafarge Conseils Et Etudes,

S.A. v. Kaiser Cement & Gypsum Corp., 791 F.2d 1334, 1338 (9th

Cir.1986). A party merits relief under Rule 60(b)(6) if he

demonstrates extraordinary circumstances which prevented or

rendered him unable to prosecute his or her case. Latshaw v.

Trainer Wortham & Co., Inc., 452 F.3d 1097, 1102-1103 (9th

Cir.2006); Martella v. Marine Cooks & Stewards Union, 448 F.2d

729, 730 (9 Cir. 1971), cert. denied, 405 U.S. 974 (1972). th

The party must demonstrate both injury and circumstances beyond

his control that prevented him from proceeding with the

prosecution or defense of the action in a proper fashion. United

States v. Washington, 593 F.3d 790, 796-797 (9 Cir.2010); th

United States v. Alpine Land & Reservoir Co., 984 F.2d 1047, 1049

(9 Cir. 1993). Here, Plaintiff has made no such showing. The th

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circumstances she describes in her motion were well within her

control. Further, as noted, the averments in her declaration are

belied by the facts - she was represented by counsel and her home

had already been foreclosed before this litigation was commenced. 

Finally, Plaintiff’s declaration makes no showing that she can

amend to allege, consistent with Rule 11, Federal Rules of Civil

Procedure, that she can the tender the loan amount or the present

ability to tender the loan amount, a prerequisite to the relief

sought.

For the reasons stated, Plaintiff’s motion for

reconsideration is DENIED.

IT IS SO ORDERED.

Dated: July 30, 2010 /s/ Oliver W. Wanger 

668554 UNITED STATES DISTRICT JUDGE

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