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IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON OCWEN LOAN SERVICING, LLC, Appellant,

v. MICHAEL E. BAUMAN and ROCIO BAUMAN, individually and their marital community; and CROSS VALLEY WATER DISTRICT, Respondents. No. 73548-9-1 (Consolidated with Nos. 73549-7-1, 73648-5-1, and 73649-3-1) DIVISION ONE

PUBLISHED OPINION
FILED: September6, 2016 Leach, J. — Ocwen Loan Servicing LLC appeals two related cases that
we consolidated. In each, the trial court dismissed, on summary judgment, Ocwen's declaratory judgment action seeking to establish a right to redeem a property foreclosed on by the Cross Valley Water District. Michael and Rocio Bauman bought both at public auction. Based on a legal error in each order of sale, the trial court decided that equitable grounds existed to grant a redemption right but also concluded that Ocwen did not have standing to redeem either property. The Baumans cross appeal, contending that the trial court erred when itcreated an equitable right to redeem the properties.No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-1, and 73649-3-1/ 2

Because a statute grants postforeclosure rights to redeem, the trial court erred when itconcluded that Ocwen had a longer equitable right to redeem the properties. The relevant statute provides only a one-year right to redeem, and Ocwen did not try to redeem during this time. Thus, for a different reason, the trial court did not err by dismissing Ocwen's lawsuits on summary judgment. Because we resolve the case on this basis, we do not reach the other issues raised by Ocwen. We affirm. FACTS Patricia and Bruno Bonvicini and James L. Turner each borrowed money to buy property. On June 20, 2008, the Bonvicinis purchased property located at 23030 105th Avenue SE in Woodinville. They financed their purchase with a loan from Evergreen Moneysource, secured by a deed of trust in favor of Mortgage Electronic Registration Systems Inc. (MERS). On November 9, 2009, Turner purchased property located at 6602 63rd Street SE in Snohomish, financing his purchase with a loan from Golf Savings Bank, secured by a deed of
trust also in favor of MERS. Both the Bonvicinis and Turner failed to pay their water service charges. Cross Valley Water District filed lawsuits against the Bonvicinis and Turner to foreclose the water district's statutory lien for delinquent water service charges.

### No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-1, and 73649-3-1/3


### Thetrial courtentered a judgment and order of sale foreach property. Itordered each sold "to the highest and best bidder for cash as provided by RCW 84.64.080 and RCW 57.20.135." Each judgment also stated that the property 

### was subject to a two-year postsale right ofredemption under RCW 35.50.270, a statutethat governs foreclosures to collect local improvementassessments. On March 13, 2012, the Baumans purchased both properties at public auction. The water district delivered a quitclaim deed to the Baumans for each 

### property "subjectto the right ofredemption within two yearsfrom the date of the sale pursuantto RCW 35.50.270." 

### Ocwen claims the right to enforce the deed of trust encumbering each 

### property. Itnotifiedthe Baumans ofits intentto redeem the Bonvicini propertyon March 25, 2013, and of its intent to redeem the Turner property on May 8, 2013. And on March 11, 2014, Ocwen filed two lawsuits againstthe Baumans, claiming 

### arighttoredeemtheproperties undertheBonvicini andTurnerdeeds oftrust. The Baumans moved for summary judgment after discovery. They 

### contended that the trial court entering the foreclosure judgment had erroneously 

### included the postsale redemption right under RCW 35.50.270 and that Ocwen lacked standing to redeem eitherproperty.No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-1, and 73649-3-1/4

The trial courtdecided that RCW 35.50.270 applied only to foreclosures to recoup local improvement assessments; it did not apply to these properties. But it concluded that because the trial court issued an order describing a right to redemption under the statute, it would be inequitable to deny that right. But the trialcourtalso concluded that Ocwen lacked standing to exercise any redemption right foreitherproperty because it did not showthat ithad a qualifying interest by the relevant date, March 13, 2014. Itdismissed both cases. Ocwen moved for reconsideration in both cases and supported the request with new evidence. The Baumans opposed each motion and asked that the trial court not consider the evidence Ocwen offered because it was available to Ocwen when it filed its response to the summaryjudgment motions. The trial court agreed and denied Ocwen's motions for reconsideration. Ocwen appeals, and the Baumans cross appeal. STANDARD OF REVIEW This court reviews summary judgment rulings de novo, viewing all the facts and inferences in favor of the nonmoving party and finding summary 

### judgment proper only if no genuine issue of material fact exists.1 This court

1 Lyons v. U.S. Bank Nat'l Ass'n, 181 Wn.2d 775, 783, 336 P.3d 1142 (2014). -4-No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-1, and 73649-3-1 / 5

reviews a trial court's order granting equitable relief de novo as a question of 

### law.2 We review statutory interpretation de novo.3 DISCUSSION We first address the Baumans' cross appeal and consider whether the courterred when itcreated an equitable right to redeem the properties. At oral argument Ocwen, for the first time, contended that we should not consider this issue because the Baumans' claim is an impermissible collateral attack on the two foreclosurejudgments inthe water district foreclosure lawsuits. Ocwen did not make this argument inthe trialcourt or in its briefing filed with this court. It makes no claim that this issue involves a manifest error affecting a constitutional right. Consistentwith the general practice ofWashington appellate courts, we decline to review this contention raised for the first time at oral 

### argument.4 The trial court concluded that each orderof sale and each deed conveying
a property to the Baumans should not have described a redemption right under RCW 35.50.270 because that statute does not apply to a foreclosure to collect a
2 Bank of Am., NA v. Prestance Corp., 160 Wn.2d 560, 564, 160 P.3d 17 (2007).3 P.H.T.S.. LLC v. Vantage Capital. LLC, 186 Wn. App. 281, 287, 345 P.3d20(2015). 4See RAP 2.5(a); Anderson v. Dussault, 181 Wn. 2d 360, 373, 333 P.3d 395 (2014) (citing RAP 12.1). -5-No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-1, and 73649-3-1/6

water district's service charges. But the trial court also decided that since the 

### "[property was sold subject to the two year period of redemption," under 

### principles ofequity, "languageregarding redemption isbinding on the Baumans." The Baumans claim that a trial court cannot create an equitable 

### redemption right when a statute provides a redemption right. The Baumans rely 

### primarily on Schroeder v. City ofRaymond.5 In that case, the Supreme Court held thatwhen an ownerof municipal bonds brought a foreclosure action undera 

### statute permitting the lawsuit, "the court had no power to grant other than the 

### statutory relief, hence the language of the decree which goes beyond what the statute directs is of no force or effect."6 The Schroeder court based its conclusion on the fact that the foreclosure was "a purely statutory proceeding 

### brought under the statute and controlled thereby."7 Any language in the court 

### decreegoing beyondthestatutoryreliefhad noforce oreffect.8 More recent cases have applied equitable principles to temper the rule 

### that a redemption right must be exercised in strict compliance with the statute 

### creatingtheright.9 In GESAFederalCreditUnionv. Mutual Life InsuranceCo.,10 5 117 Wash. 238, 200 P. 1092 (1921), affd, 117 Wash. 238, 204 P. 180 (1922).6 Schroeder, 117 Wash, at 243. 7 Schroeder, 117 Wash, at 242. 8 Schroeder, 117 Wash, at 243. 9Fid. Mut.Sav. Bankv.Mark, 112 Wn.2d 47, 54, 767 P.2d 1382 (1989). 10 105 Wn.2d 248, 251, 713 P.2d 728 (1986). -6-No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-1, and 73649-3-1 / 7



### our Supreme Court considered whether a purchaser's failure to file a statement 

### of paid taxes, as required by a redemption statute, barred the purchaser from recovering those payments from a subsequent redemptioner. Because the redemptioner had received actual notice from the purchaser, the court applied 

### the equitable principle of substantial compliance toexcusethe failure tofile. The court distinguished redemption statute provisions creating a substantive right from those establishing the procedure to perfect that right. It found the filing 

### requirementto be aprocedural step subjectto asubstantialcompliancerule.11 Fidelity Mutual Savings Bank v. Mark12 illustrates the importance of the 

### distinction between provisions creating substantive rights and those describing 

### perfection procedures. The court refused to apply equitableprinciples to provide a redemption right to a judgment debtor's assignee whose assignment did not 

### comply with Washington's real property statutes and thus did not convey the 

### judgment debtor's title. Without title, the assignee was not "a successor in interest" granted a statutory rightto redeem.13 The courtnoted the harshness of its decision to deny equitable reliefbut characterized the requested reliefas the 

### granting of a substantive right and stated, "The rights established by the

11 GESA Fed. Credit Union, 105 Wn.2d at 254-55. 12112Wn.2d47, 767 P.2d 1382(1989). 13 Mark, 112 Wn.2d at 53. -7-

### No.73548-9-1 (consol. w/ Nos. 73549-7-1 73648-5-1, and 73649-3-1 / 8 

### Legislature mustremain exclusive ifthey are toremain reliable."14 Thus, thetrial courtdid not have the authorityto create a redemption right. Next we consider whether Ocwen hada statutory right to redeem the 

### properties. We interpret statutes to give effect to the legislative intent, looking first to the statute's plain meaning and, where statutory language is 

### unambiguous, giving effectto thatplain language.15 

### CrossValleyfiled itsforeclosure lawsuits underRCW57.08.081(4).16 This statute provides thatin a waterdistrictforeclosure lawsuitthe laws "shall control
as in other civilactions."17 This means that we look to the statutes providing for 

### the sale of realpropertyto satisfy a judgment to decide ifOcwen has redemption 

### rights. Chapter 6.21 RCW contains the statutory provisions for a real property

14Mark, 112 Wn.2d at 55. 15 P.H.T.S.. 186Wn. App. at 290. 

### 16 The district may, at any time after the connection charges or 

### rates and charges for services supplied or available and 

### penalties are delinquent for a period ofsixty days, bring suitin foreclosure by civil action in the superior court of the county in which the real property is located. The court may allow, in addition to the costs and disbursements provided by statute, 

### attorneys' fees, title search and report costs, and expenses as it 

### adjudges reasonable. The action shall be in rem, and may be broughtinthe name ofthedistrictagainst anindividual or against all ofthose who are delinquent inone action. The laws and rules ofthe court shall control as in other civil actions. 17 RCW 57.08.081(4). -8-No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-1, and 73649-3-1/9


### execution sale. RCW6.21.080 applies to the sales in this case and provides for redemption rights as granted inchapter6.23 RCW: 

### A sale of a real property estate of less than a leasehold of two 

### years unexpired term and a sale of a vendor's interest in real property being sold under a real estate contract shall be absolute. In all other cases, real property shall be sold subject to redemption, as provided in chapter 6.23 RCW. 

### (Emphasis added.) And RCW6.23.010 grantsqualifying parties, including
successors in interest, redemption rights: 

### (1) Real property sold subject to redemption, as provided in RCW 6.21.080, or any part thereof separately sold, may be redeemed by the following persons, or their successors ininterest: 

### (a) The judgment debtor, in the whole or any part of the property separately sold. 

### (b) A creditor having a lien byjudgment, decree, deed of trust, ormortgage, on anyportion of the property, or anyportion of any partthereof, separately sold, subsequent in priority to that on which the property was sold. The persons mentioned in this subsection are termed redemptioners. 

### (2) As used in this chapter, the terms "judgment debtor," "redemptioner," and "purchaser" refer also to their respective successors in interest. 

### Qualifying parties must redeem within one year after the foreclosure sale: "Unless redemption rights have been precluded pursuant to RCW 61.12.093 et 

### seq., thejudgmentdebtororanyredemptionermayredeemthepropertyfromthe 

## purchaseratanytime
. . .withinoneyearafterthedateofthesale."18

18 RCW 6.23.020(1).No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-I, and 73649-3-1/10 

### Thus, Ocwen had one yearto redeem each property. Because it took no 

### step to redeem within thistime, itsredemption rights expired. Thetrial courtdid not err by dismissing Ocwen's declaratoryjudgmentlawsuits. Baumans contend that Ocwen had no redemption rights. They correctly note that each order of sale authorized the water district's treasurer to sell each 

### property as provided in RCW 84.64.080 and RCW 57.20.135. Theyclaim that the water district has two options to foreclose its statutory lien: (1) the civil 

### lawsuit authorized by RCW 57.08.081(4) and (2) a sale by its treasurer in the
same manner as a property tax foreclosure sale authorized by chapter 84.64
RCW. 

### Baumans begin their analysis with RCW 57.08.005(22). This statute authorizes a water district to exercise any powers "granted to cities and counties 

### with respect to the acquisition, construction, maintenance, operation of, and 

### fixing rates and charges forwaterworks and systems ofsewerage and drainage." Former RCW 36.94.150 (1997) grants a county a lien for unpaid water service 

### charges and provides for foreclosure of thatlien "in the same manner as the foreclosure of real property tax liens." Thus, a water district can use this alternate tax foreclosure process. In this tax foreclosure process, only minors

•10-No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-I, and 73649-3-1/11 

### and persons adjudicated legally incompetent have redemption rights.19 Thus, Ocwen had no redemption rights. 

### Baumans' argument does not persuade us. RCW57.08.005(22) does not 

### expressly grant any lien or foreclosure rights. We see no reason to imply a grant 

### by this statute of lien and foreclosure rights with different procedures when another statute, RCW 57.08.081(4), expressly addresses the subject. To do so 

### would violate the general rule that a specific statute controls over a general statute.20 Additionally, the exercise ofthese implied powers could produce harsh results for which Baumans have shown no legislative intent. 

### We conclude that the specific language of RCW 57.08.081(4) authorizing 

### water districts to "bring suitin foreclosure bycivil action" provides Cross Valley's only statutory authorityto foreclose on the properties. CONCLUSION 

### Because a trial court may not provide equitable rights expanding a 

### statutory grant of the substantive right to redeem property, the trial court erred when itconcluded that Ocwen had an equitable right to redeem the properties 

### within two years. Ocwen had only the one-year statutory redemption right 

### granted by RCW 6.23.020(1). BecauseOcwen did not attempt to redeem the 19 Former RCW 84.64.070 (2002). 20Johnson v. Cent. Valley Sch. Dist., 97 Wn.2d 419, 428, 645 P.2d 1088 (1982). -11-No. 73548-9-1 (consol. w/ Nos. 73549-7-1, 73648-5-I, and 73649-3-1/12 

### properties within one year, the trial courtproperly dismissed Ocwen's declaratory 

### judgmentlawsuits. While this was not the basis for the trial court's decision, we 

### may sustain thetrial courton any basis therecord supports.21 Weaffirm.

WE CONCUR

21 Nw. Collectors. Inc. v. Enders. 74 Wn.2d 585, 595, 446 P.2d 200 -12- (1968).