IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

JOHN P. REISINGERAND BARBARA J. REISINGER, husband and wife, Appellants,

v. DEUTSCHE BANK NATIONAL TRUST COMPANY, as Trustee for the Certificate Holders of Soundview Home Loan Trust 2005-OPT3, Asset-Back Certificates, Series 2005-OPT3, Respondent. NO. 69867-2-1 DIVISION ONE

UNPUBLISHED OPINION FILED: April29, 2013 C"3 o

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### Lau, J. —John and Barbara Reisinger defaulted on their residential mortgage 

### loan. Deutsche Bank National Trust Company nonjudicial^ foreclosed on the deed of 

### trust securing the loan. The Reisingers appeal the trial court's summary judgment order 

### dismissing theirlawsuit, which allegedprocedural violations oftheWashington deeds of trust act, chapter61.24 RCW. They also challenge the court's dismissal of their vicarious Consumer Protection Act (CPA) chapter 19.86 RCW, claim against Deutsche 

### based on the alleged wrongful conduct of the loan servicer. Becausethe record69867-2-1/2 

### undisputedly shows that the trustee's sale complied with alldeeds oftrust act requirements and because the Reisingers failed to raise a genuine fact issue as to Deutsche's vicarious liability for the servicer's alleged CPA violation, we affirm the summaryjudgment order dismissing the Reisingers' lawsuit. FACTS InJuly 2005, John and Barbara Reisinger granted a deed oftrust infavor of 

### Option One Mortgage, a California corporation, to secure a $149,987 home loan they obtained from Option One. Option One later assigned its interest in the note and deed of trust to Deutsche Bank National Trust Company as trustee for the Certificate Holders of Soundview Home Loan Trust 2005-OPT3, Asset-Backed Certificate Series 2005- 

### OPT3. Deutsche appointed Northwest Trustee Services Inc. as successortrustee and authorized American Home Mortgage Servicing Inc. (AHMSI)to act as its servicing agent. 

### The Reisingers defaulted on the note. In January 2008, Northwest posted and mailed a notice ofdefault. In February 2008, Northwest recorded a notice oftrustee's 

### sale, alleging an outstanding balance of$8,951.78. The notice scheduled a trustee's sale for May 23, 2008. 

### One day before the trustee's sale, the Reisingers filed forbankruptcy and obtained an automatic stay. InMarch 2010, the bankruptcy court granted Deutsche's unopposed motion to lift the stay. InApril 2010, Northwest recorded an amended notice oftrustee's sale. The notice alleged an outstanding balance of$57,663 and scheduled


### a new trustee's sale for May 14, 2010. Northwest postponed the sale several times 

### while the Reisingers unsuccessfully negotiated a loan modification with AHMSI. The
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### trustee's sale finally occurred on September 10, 2010. Deutsche purchased the property and obtained a trustee's deed. InMarch 2011, the Reisingers sued Deutsche to set aside the trustee's sale, 

### alleging procedural violations of the deeds of trust act (Act) and requesting an order quieting title, an accounting under the note, and damages underthe CPA. Deutsche 

### moved todismiss the suit underCR 12(b)(6).1 BecauseDeutsche submitted documentary evidence with its motion, the trial court converted the motion into a CR 56 

### motion for summaryjudgment.2 TheReisingers filed a summaryjudgmentresponse, arguing that the trustee's sale was invalid due to "errors in the default paperwork," "equitable factors that preclude sale," "legal presumptions that favorthe plaintiff borrower," and "facts showing an unfairand deceptive act." In September2011, the 

### court granted summaryjudgment in favor ofDeutsche. The Reisingers filed this pro se appeal. ANALYSIS 

### The Reisingers contend that procedural irregularitiesrendered the trustee's sale invalid and thatAHMSI's bad faith negotiations constituted a CPA violation for which 

### Deutsche is vicariouslyliable. Deutsche argues that no genuine issues of material fact 

### remain regarding either the sale's compliancewith all statutory requirements or its liability forAHMSI's alleged CPAviolation. We agree with Deutsche and affirm.



### 1CR 12(b)(6) permits a partyto assert "failure to state a claim uponwhich relief can be granted" as a defense to a claim for relief. 

### 2The Reisingers do not assign error to thistrial courtaction. -3-69867-2-1/4

Standard of Review 

### We review an ordergranting summaryjudgmentde novo. Jones v. Allstate Ins. Co., 146 Wn.2d 291, 300, 45 P.3d 1068 (2002). We will affirm the trial court if, viewing the facts and reasonable inferences inthe lightmostfavorable to the nonmoving party, 

### we determine that no genuine issues of material fact remain and the moving party is 

### entitled to judgmentas a matter oflaw. Jones, 146Wn.2d at 300-01; CR56(c). "To defeat summaryjudgment, [thenonmoving party's] evidence must set forth specific, detailed, and disputed facts; speculation, argumentative assertions, opinions, and 

### conclusory statementswill notsuffice." Sanders v. Woods. 121 Wn. App. 593, 600, 89 P.3d 312 (2004). Notice of Default 

### In asupplemental brief,3 theReisingers arguethatthetrustee's salewasinvalid because neitherthe trustee nor Deutsche reissued the notice ofdefault after the 

## bankruptcycourtliftedthe automatic stay in March 2010.4 Theyclaimtheywereentitled to a new notice ofdefault before the trustee issued its amended notice ofsale inApril 2010. This claim lacks merit for three reasons. 

### First, Deutsche never rescinded the notice of default and nothing in the Act 

### required the trustee orDeutsche toreissuethenotice. Afterthebankruptcy court lifts 3In September2012, Division Two ofthiscourtissued a notation ruling granting 

### theReisingers permission tofile a supplemental briefandpermitting Deutschetofile a 

### supplemental response brief. The Reisingers filed asupplemental briefon October22, 2012. Deutschefiled a supplemental response briefon November 19,2012. 

### 4TheReisingers' opening briefclaimsthis issue wasdiscussed "at length" in one of itstrial courtbriefs. Appellants' Revised Opening Br. at 5. We do notallow litigants 

### toargue using incorporation by reference. DiversifiedWood Recycling. Inc. v. Johnson, 161 Wn. App. 859, 890, 251 P.3d 293 (2011). -4-69867-2-1/5



### an automatic stay, "the trustee may set a new sale date which shall not be less than forty-fivedays afterthe date ofthe bankruptcy court's order." RCW 61.24.130(4). At least 30 days before the new sale date, the trustee must issue a new notice ofsale that complies with requirements in RCW 61.24.040(1 )(a)-(f). RCW61.24.130(4)(a). 

### Additionally, the trustee must publish the notice "in a legal newspaper ineach county in which the property or any part thereofis situated, once between the thirty-fifth and twenty-eighth day before the sale and once between the fourteenth and seventh day before the sale." RCW 61.24.130(4)(b). The statute nowhere requires the trustee to 

### reissue the notice of default.5 See Meyers Wav Dev. Ltd. P'ship v. Univ. Sav. Bank. 80 Wn. App. 655, 671, 910 P.2d 1308(1996) (trustee's issuance of new notice ofsale 

### following dismissal of the deed oftrust grantor's bankruptcy petition "was not cause for renewing the process from the beginning"). 

### Second, the Reisingers' challenge fails because they demonstrate no prejudice. We construe the Act to further three public policy objectives: "First, the nonjudicial foreclosure process should remain efficient and inexpensive. Second, the process 

### should provide an adequate opportunity forinterested parties to prevent wrongful foreclosure. Third, the process should promote the stability of land titles." Cox v. Helenius, 103 Wn.2d 383, 387, 693 P.2d 683 (1985) (citation omitted). In light ofthese 

### objectives, we have held that a litigant seeking to set aside a trustee's sale based on a procedural irregularity must show prejudice. Koeael v. Prudential Mut. Sav. Bank, 51


### 5Thelegislature substantially amended theAct in 2009 to addnew requirements forforeclosure ofowner-occupied residential property and property occupied by residential tenants. See Laws of2009, ch. 292. The Reisingers do not argue that 

### these changes applied retroactively to the notice of default issued inJanuary 2008. -5-69867-2-1/6 Wn.App. 108, 113, 752 P.2d 385 (1988) (trustee's issuance of notice ofsale less than 

### 30 days after notice ofdefaultwas nonprejudicial under the circumstances and did not provide a basis to void the sale); see also Steward v. Good, 51 Wn. App. 509, 515, 754 P.2d 150 (1988) (trustee's failure to provide sufficient notice ofthe sale date did not provide a basis to void the sale where there was "no showing ofharm to the debtor."). The Reisingers do not argue that they suffered prejudice. Finally, even ifthe statute required the trustee to reissue the notice ofdefault, the Reisingers waived their challenge by failing to seek a presale order restraining the sale. "[W]aiver ofany postsale challenge occurs where a party (1) received notice ofthe right to enjoin the sale, (2) had actual or constructive knowledge of a defense to foreclosure priorto the sale, and (3) failed to bring an action to obtain a court order enjoining the sale." Albice v. Premier Mortgage Servs. ofWash., Inc.. 174 Wn.2d 560, 569, 276 P.3d 1277 (2012) (citing Plein v. Lackey. 149 Wn.2d 214, 227, 67 P.3d 1061 (2003)). The alleged violation ostensibly occurred in April 2010 when the trustee recorded the amended notice of sale without reissuing the notice of default. Because the trustee's sale occurred in September 2010, the Reisingers had ample opportunity to obtain a presale injunction. They do not contest that they received notice oftheir right 

### to enjoin the sale, thatthey had actual or constructive knowledge oftheir challenge before the sale, and that they failed to seek an order restraining the sale. Instead, the undisputed record shows they challenged the sale procedures for the first time intheir March 2011 action to quiet title. "To allow one to delay asserting a defense until this 

### late stage ofthe proceedings would be to defeat the spirit and intent ofthe trust deed act." Peoples Nat'l Bank ofWash, v. Ostrander. 6 Wn. App. 28, 32, 491 P.2d 1058
-6-69867-2-1/7 (1971). In light ofthe undisputed record, we conclude that waiver is "equitable under 

### thecircumstances and . . . serves the goals oftheact."6 Albice. 174Wn.2d at570.
Trustee's Deed The Reisingers next argue that the trustee's sale was invalid because the trustee's deed contains an erroneous recital.7 The deed states thatthe trustee recorded the notice of sale in February 2008 when, in fact, the trustee recorded an amended notice ofsale in April 2010. The Reisingers claim this error renders the trustee's deed invalid on its face because itdemonstrates that the sale did not occurwithin 120 days of the sale date set by the notice ofsale, as required by RCW 61.24.040(6): A simple calculation shows that 931 days had passed from the recording ofthe Notice ofTrustee's Sale to the date ofthe Trustee's Sale itself. The 2008 Notice ofTrustee's Sale recites a sale date of May 23, 2008. RCW 61.24.040(6) provides that a trustee may continue a sale for a period "not exceeding a total of 

### 120 days." That takes the sale date out to mid-September of2008. The purported sale took place two years later—well beyond the statutory time limit. Appellants' Suppl. Br. at 2-3. Deutsche agrees that the recital should have referred to the amended notice of sale recorded in April 2010 as opposed to the original notice of sale recorded in 

### 6Under a 2009 amendment to theAct, "[t]hefailure ofthe borroweror grantorto bring a civil action to enjoin a foreclosure sale under this chapter may not be deemed a waiver of a claim for damages asserting:
... (c) Failure ofthe trustee to materially comply withthe provisions of this chapter." Laws of2009, ch. 292, § 6 (emphasis added), now codified as RCW 61.24.127(1). The amendment clarifies, "The claim may 

### not seek any remedy at law or inequity otherthan monetary damages." Laws of2009, ch. 292, § 6 (emphasis added), now codified as RCW 61.24.127(2)(b). Because the Reisingers sought to void the trustee's sale (i.e., they did not seek monetary damages), the amendment does not affect our conclusion that waiver applies. 

### 7Under RCW 61.24.040(7), a trustee's deed's recital ofstatutory compliance constitutes "prima facie evidence ofsuch compliance and conclusive evidence thereof in favor ofbona fide purchasers and encumbrancers forvalue . . . ." Deutsche does not 

### argue that itwas a bona fide purchaserwithin the meaning of this provision. -7-69867-2-1/8 

### February 2008. Itargues, however, that we should lookbehind the recital to confirm that, in fact, the sale occurred no more than 120 days afterthe sale date set by the amended notice of sale: 

### The Reisingers do correctly point out that the trustee's deed referenced the 

### original Notice ofTrustee's Sale setting the foreclosure sale for February 2008. But this is irrelevant since the Public Record establishes, and the Reisingers concede, that an Amended Notice ofTrustee's Sale was recorded in April2010. Deutsche further argues: 

### [The amended notice ofsale] setthe sale date for May 14, 2010. The trustee's sale occurred on September 10, 2010—within 120 days ofthe original sale date. Therefore, reference inthe trustee's deed to the original 2008 notice of foreclosure is immaterial because the Official Records include the required 

### notices and documents showing compliance withthe [Act], 

### Respondent's Suppl. Response at 9 (citations omitted). 

### We agree with Deutsche. In Albice, the court looked behind the recitals in a trustee's deed to determine that, as a matter of fact, the trustee continued the sale 

### beyond the statutorily mandated 120-day limit: 

### [Sjtrictly applying the statute as required, we agree with the Court ofAppeals and hold that under RCW 61.24.040(6), a trustee is not authorized, at least not 

### without reissuing the statutory notices, to conduct a sale after 120 days from the original sale date, and such a sale is invalid. Here, Premier issued the notice oftrustee's sale listingthe sale date as 

### September 8, 2006. Premier held the actual sale on February 16, 2007, 161 

### days from the original sale date in violation ofthe statute and divesting its statutory authority to sell. The sale was invalid. Albice, 174 Wn.2d at 568. Inso holding, the court disregarded the deed's recital that 

### "misleadingly listed the sale date in the notice oftrustee's sale as February 16, 2007, instead of the original sale date ofSeptember 8, 2006." Albice. 174 Wn.2d at 573 n.9. 

### It also disregarded the deed's "conclusory" recital stating, "'[A]ll legal requirements and

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### all provisions ofsaid Deed ofTrust have been complied with, as to acts to be performed and notices to be given, as provided in Chapter61.24 RCW."' Albice, 174 Wn.2d at 573 n.9. As in Albice, we look behind the inaccurate recital and conclude that the trustee's sale in fact complied with all statutory requirements. We do so because it is our function "to ensure trustees strictly comply with the requirements ofthe act. . . ." Albice. 174 Wn.2d at 572. The Reisingers do not dispute that Deutsche recorded an 

### amended notice ofsalein April 20108 and that the saleactually occurredwithin thetime allotted by statute.9 Underthese circumstances, tofavorthe deed's recitals overthe undisputed record would undermine the goals of efficiency and stability of land titles without enhancing the Reisingers' "opportunity
... to prevent wrongful foreclosure. See Cox. 130 Wn.2d at 387. We decline to void the trustee's sale. The Reisingers' claim fails for the additional reason that they neither claim nor demonstrate prejudice. As discussed above, a litigant seeking to set aside a trustee's sale based on a procedural irregularity must show prejudice. Koegel, 51 Wn. App. at 113. The same rule applies when the litigant challenges an irregularity occurring at or afterthe sale. Colo. Structures. Inc. v. Blue Mountain Plaza, LLC. 159 Wn. App. 654, 

### 8TheReisingers alleged the existenceofthe amendednotice of salein their complaint and referto it intheir supplemental brief. They acknowledge that the amended notice ofsale "[theoretically
. . . could have been appropriate," but argue that 

### we should disregard it. Suppl. Br. ofAppellants at4. For the reasons discussed above, we decline to disregard the amended notice of sale. 

### 9The Reisingers speculate that the trustee's deed deliberately referred to the original notice ofsale because "the trustee realized thatthe amended Notice of Trustee's Sale was invalid and had to hide it from scrutiny by not mentioning it inthe 

### Trustee's Deed or inany ofthe court documents." Suppl. Br. ofAppellants at 3. This unsupported claim lacks merit. -9-69867-2-1/10 666, 246 P.3d 835 (2011): see also Albice. 174 Wn.2d at 581 n.4 (Stephens, J., concurring). The Reisingers do not argue that recital prejudiced them in any way. In a related argument, the Reisingers contend that the trustee's deed is invalid because itstates that the trustee "caused copies ofthe statutory 'Notice ofTrustee's 

### Sale' to be transmitted by mail to all persons entitled thereto and either posted or served prior to 90 days before the sale " Under RCW 61.24.130(4), ifthe bankruptcy court liftsan automatic stay, the trustee "may set a new sale date which shall not be less than 

### forty-fivedays afterthe date ofthe bankruptcy court's order." Because the statute refers to a 45-day period, the Reisingers argue thatthe 

### reference inthe trustee's deed to a 90-day period renders the deed invalid on its face. 

### This argument fails. As discussed above, the trustee's sale in fact complied with the Act, including RCW61.24.130(4)'s requirement that the trustee setthe postbankruptcy stay sale date at least45 days after the date of the bankruptcy court's order. Because 

### the Reisingers received adequate notice and demonstrate no prejudice, their challenge fails. Colo. Structures, 159 Wn. App. at 666. Consumer Protection Act 

### To prevail on an action fordamages under the CPA, the plaintiffmust establish


### an "(1) unfair ordeceptive act or practice; (2) occurring intrade or commerce; (3) public interest impact; (4) injury to plaintiffin his or her business or property; (5) causation." Hangman Ridge Training Stables. Inc. v. Safeco Title Ins. Co., 105 Wn.2d 778, 780, 

### 719 P.2d 531 (1986). "[WJhethera particular action gives rise to a Consumer Protection Act violation is reviewable as a question of law." Leingang v. Pierce County Med. Bureau. Inc., 131 Wn.2d 133, 150, 930 P.2d 288 (1997).
-10-69867-2-1/11
The Reisingers contend that Deutsche committed a vicarious CPA violation when AHMSI refused to negotiate a loan modification in good faith: While appellants understood that AHM[S]I was under no obligation to modify their mortgage, by accepting appellants' application, AHMSI took upon itselfan obligation to process that application in a professional manner and to act in good faith. Yet AHMSI lost appellants' application at leasttwice, lost repeated submission ofdocuments made by appellants and consistently refused to allow appellants to speak directly to anyone in a decision making capacity. Br. ofAppellants, Revised at 2-3 (citation omitted). The Reisingers did not name AHMSI as a defendant. Instead, they argue that Deutsche is vicariously liable for AHMSI's bad faith acts because, as AHMSI's principal, it "must accept responsibility for every action and omission of AHMSI as if itwere their own." Br. ofAppellants, Revised at4. They cite no authority for this contention. Even assuming without deciding thatthe trial court may impose vicarious liability

on a note holder and deed oftrust beneficiary for a CPA violation committed by a loan servicer, we conclude that the record provides no basis to impose vicarious liability on Deutsche. "We consider several factors before imposing vicarious liability, butthe most 

### crucial factor is the right to control the manner, method, and means by which the work and the desired result was to be accomplished." Chicago Title Ins. Co. v. Wash. State Office ofIns. Comm'r, 166 Wn. App. 844, 854-55, 271 P.3d 373, review granted, 174 Wn.2d 1012 (2012): see also Stephens v. Omni Ins. Co., 138 Wn. App. 151, 183, 159 

### P.3d 10 (2007) ("The right to control is indispensable to vicarious liability."). To survive 

### summaryjudgment, the Reisingers must raise a genuine issue of material fact regarding

-11-69867-2-1/12 

### Deutsche's righttocontrol AHMSI's loan modification negotiations with theReisingers.10 The record shows that the Reisingers submitted no evidence of control in their summary judgment materials. Because the Reisingers failed to sustain their burden, the trial court properly granted summaryjudgment infavor of Deutsche. The Reisingers' claim also fails because they do not adequately explain how the trial court erred in its application ofthe Hangman Ridge test quoted above. Underthat test, "a claim under the Washington CPA may be predicated upon a per se violation of statute, an act or practice that has the capacity to deceive substantial portions ofthe public, or an unfair or deceptive act or practice not regulated by statute but in violation of public interest." Klem v. Wash. Mut. Bank. Wn.2d , 295 P.3d 1179, 1187 

### (2013). Although the Reisingers claim they "demonstrated a consistent pattern of deceptive behavior on the part ofthe [Deutsche's] Servicing Agent, AHMSI," they do not cite the record for support. Suppl. Br. ofAppellants at 7. They also fail to explain why AHMSI's behaviorwas "unfair" or "deceptive" under the CPA. "Absent adequate, 

### cogent argument and briefing, we decline to wanderthrough the complexities of the Consumer Protection Act." Saunders v. Lloyd's ofLondon, 113Wn.2d 330, 345, 779 P.2d 249 (1989): see also Palmer v. Jensen, 81 Wn. App. 148, 153, 913 P.2d 413 

### (1996) ("Passing treatment of an issue or lack ofreasoned argument is insufficientto



### 10 Deutsche did not raise the issue of vicariousliability below. Butbecause its argument regarding control relies only on evidence presented to the trial court, and in the interest ofjudicial economy, we exercise our discretion to considerthe issue. See RAP 2.5(a) ("A party may present a ground foraffirming a trial court decision which was 

### notpresented to the trial court ifthe record has been sufficiently developed to fairly considerthe ground."). -12-69867-2-1/13 merit judicial consideration."). Because the Reisingers demonstrate no trial court error, we affirm the court's summaryjudgment order dismissing the Reisingers' lawsuit.

WE CONCUR: 

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