N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
TODD SHAR

P, M AR IA SHARP, Plaintiffs - Appe lla nts,
v. NATIONSTAR

M OR TGAGE, LLC ; AUR OR A LOAN SER

V IC ES, De fe nda

nts - Appe lle e s. No. 15-15066 D.C . No. 5:14-c v-00831-LHK
M EM O R ANDUM *

Appe a l from

the Unite d

Stat e s Distric t C ourt for the Northe rn Distric t of C a lifornia L uc y H. Koh, Distric t

Judge , Pre siding Argue d a nd Subm itte d Fe brua

ry 13, 2017 Sa n Fran c isc o , C a lifornia B e fore : W . FLETC HER , R AW LINSON, C irc uit Judge s, a nd PR ATT**, Distric t Judge
. 

# F IL ED JUL 05 2017 M OLLY C. DW Y E R, CLERK U. S. CO URT O F APPEALS

* This disposition is not a ppropria te for public a t ion a

nd is not pre c e de nt e xc e pt a s provide d

by 9th C ir. R . 36-3. ** The Honora

ble R obe rt W . Pra tt, Distric t Judge for the U.S. Distric t C ourt for the Southe rn Distric t of Iowa , sitting by de s igna tion. 1Todd a nd M aria Sharp (the Sharps) a ppe a l the distric t c ourt’ s orde r granting the m otion to dism

iss file d by

de fe n da nts Na tionsta r M ortga ge , LLC , (Na t ionsta r)
and Aurora

C om m e rc ia l C orp. (Aurora ) pursua nt to Fe d. R . C iv. P. 12(b)(6). 1 The Sharps a sse rt tha

t the distric t c ourt’ s a

pplic a tion of judic ia l e stoppe l wa s a n a buse of disc re tion. 2 W e re vie w a distric t c ourt’ s dism issa l unde r R ule 12(b)(6) de nov o . Se e Mashiri v . Epste n Grinne l l & How e ll , 845 F.3d 984, 988 (9th C ir. 2017). “ W e
m ay a ffirm on a ny ba sis supporte d

by the re c ord, whe t

he r or not re lie d upon by

the distric t c o urt.” Some rs v . Apple , Inc
. , 729 F.3d 953, 960 (9th C ir. 2013) (c ita tion
om i tte d). 1. In C a lifornia , the sta tute of lim ita

tions for fra

ud is thre e y e ars from

“ the disc ove ry , by

the a ggrie ve d pa

rty , of the fa c ts c onstituting the fraud.” C a l. C iv. Proc . C ode § 338(d). The Sharps ha d notic e suffic ie nt to prom pt a re a sona ble pe rson to inquire

re ga rding a ny a sse rte d m isre p re se ntation whe n the y re c e ive d a le tte r from

Aurora date d Nove m

be r 24, 2010, a le rting the m to the re fe rra l for fore c losure
. S

e e Platt Ele c . Supply

, Inc . v . EOFF Ele c ., Inc
. , 522 F.3d 1049, 1056

1 Although the

c a ption lists Aurora Loa

n Se rvic e s a s the De fe nda nt, the pa rtie s a gre e tha

t Aurora C om m e rc ia l C orp. is the prope r de fe nda nt. 2 B e c a use we c onc lude that the Sharps’ c la im s fa il on them e rits, we do not a ddre s s the distric t c ourt’ s a pplic a tion of judic ia l e stoppe l.

2(9th C ir. 2008) (“ It is the disc ove ry of fa c ts, not the ir le ga l signific anc e , tha t sta rts the s tat ute .” ) (c ita

tion a nd a lte ra tion om itte d). M ore tha n thre e y e ars e la

pse d be twe e n the Nove m

be r, 2010, le tte r a

nd the filing of theinitia l c om pla int in Ja nua ry , 2014, re nde ring the Sharps’ m isre p re se ntation a nd c onve rsion c l a im s tim e -barre d. Se e id. ; se e also C a l. C iv. Proc
. C ode § 338(a ). 2. Unde r C a lifornia

la w, the re is no inde

pe nde nt c ivil c a

use of a c tion for
e m be z z le m e nt; a

ny e m be z z l e m e nt c la im

is subsum e d in a c la im

for c o nve rsion. Se e In reBasinge r , 45 C a l . 3d 1348, 1363 (1988) (in ba nk). B e c a

u se the Sharps’
c onve rsion c la i m

is tim e -barre d, no via

ble c a use of a c tion re m a ins on thepurporte d
e m be z z le m e nt c l a im
. 3. Ne ithe r Aurora

nor Nationsta

r bre a c h e d

a c ontra c t with theSharps by fa iling to offe r a

loa n m o dific a tion or fore c losure a lte rna tive a fte r the e xpira tion of the W orkout Agre e m e n t. The te rm s of the W orkout Agre e m e nt e xplic itly
e sta blishe d the le nde r’ s disc re tion to offe r a ne w m odific a tion a gre e m e nt or to
re sum e fore c losure proc e e dings a bse nt a ne w a g re e m e nt. “ If c ontra c tua l la ngua ge is c le ar a nd e xplic it, it gove rns.” C ounty of San Die

go v . Ac e Prop. &C

as. Ins. C o. , 37 C a l. 4th 406, 415 (2005) (c ita tions omitte d ). 4. The Sharps’ c la im

for bre a c h

of the im plie d c o ve na

nt is m a te ria lly ide n tic a l to the bre a c h of c ontra c t c la im . “ W he re a lle ga tions for bre a c h of the 3im

plie d c ove na

nt do not go be

y ond the sta

te m e nt of a m e re c ontra c t bre a c h a nd,
re ly ing on thesa

m e a lle g e d a c ts, sim

ply se e k the sam e dam a ge s or othe r re lie f
a lre a dy c la i m e d in a

c om pa nion c ontra c t c a

use of a c t ion, the y m ay

be disre ga

rde d
a s supe rfluous a s no a dditiona l c la im is a c tua lly

sta te d. . . .” Shate r ian v . W

e lls Fargo Bank

, N .A., 829 F. Supp. 2d 873, 884 (N.D. C a l . 2011) (c ita tions a n d inte rna l quota

tion m arks om itte d). 5. W he n the a l le ge d prom i se s in a c la im for prom issory

e stoppe l re late to
a loa n m odific a tion, in C a l ifornia a la c k of de finitive te rm s for the loa n “ re nde rs the a lle ge d prom ise s insuffic i e ntly c le ar and una

m biguous to support a

prom issory
e stoppe l.” Danie ls v . Se le c t Portfolio Ser

v ic ing, Inc
. , 246 C a l. App. 4th 1150, 1179 (2016) (c i tation om itte d). The only doc um e nt offe re d by

the Sharps in support of this c a

use of a c tion is a

le tte r from

Aurora tha t did not inc lude any

te rm s for a p ropose d loa

n m odific a tion a

nd did not sta

te in c le a r, una m biguous te rm s tha

t
a loa n wa s gua rante e d. B e c a

use the Sharps did not a lle ge that the re we re a dditiona l prom ise s subse q u e nt to this lette r c onta ining spe c ific te rm s, the y c annot have re a sona

bly re lie d upon thec onte nts of the le tte r a s c onta ining a future prom ise , and a

re una ble to suffic ie ntly

ple a d a c a use of a c tion for prom issory
e stoppe l. Se e id.

46. The Sharps’ ne glige nc e a lle ga tions we re not suffic ie nt “ to sta te a c la im to re lie f tha

t is pla usible on its fa c e . ” Ashc roft v . Iqbal , 556 U.S. 662, 678 (2009) (c ita

tion a nd inte rna l quota

tions omi tte d). “ [A] s a

ge ne ra l rule , a fina

nc ia l institution owe s no duty

of c are to a

borrowe r whe n the institution’ s involve m e nt in the loa n tra nsa c tion doe s not e xc e e d the sc ope of its c onve ntiona l role a s a m e re le nde r of m one y . . . .” N

y mark v . He art Fe d. Sav . & Loan Ass’n. , 231 C a l. App. 3d 1089, 1096 (1991) (c ita

tions omitte d ). 7. Afte r filing thre e am e nde d c om pla ints, theSharps ne ve rthe le ss fa ile d to ple a d a via ble c a use of a c tion for a

ny of the ir c l a im s. Thus, dism issa l of the
a c tion without furthe

r le a ve to a

m e nd wa s wa

rra nte d. Ric h v . Shrade r , 823 F.3d 1205, 1209 (9th C ir. 2016) (“ [W ] he n the distric t c ourt ha s a lre a dy a fforde d a pla i ntiff a n opportunity

to a m e n d the c om

pla int, it ha s wide disc re tion in gra nting
or re fusing le a v e to a

m e nd a fte r the first a

m e ndm e nt . . .” ) (c ita

tions a nd inte rna l quota t ion m arks om itte d). AFFIRM E D.

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