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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Hector Hermosillo,

Plaintiff,

v. 

Caliber Home Loans Incorporated, et al.,

Defendants.

No. CV-15-02052-PHX-ESW

ORDER 

Pending before the Court is Defendant’s fully briefed Motion to Dismiss and 

Supporting Memorandum (Docs. 24, 33, 34). Defendant seeks dismissal of Plaintiff’s 

Verified Complaint (Doc. 1-1 at 5-16), which alleges seven causes of action arising from 

the completed foreclosure of Plaintiff’s home. The case was removed to the United 

States District Court from the Maricopa County Superior Court of Arizona by Notice of 

Removal filed on October 12, 2015 (Doc. 1). The Federal Court has original jurisdiction 

on the basis of diversity of citizenship as well as federal question pursuant to 28 U.S.C. § 

§ 1441(a), 1441(b), and 1331. The parties have consented to proceeding before a 

Magistrate Judge pursuant to Fed. R. Civ. P. 73 and 28 U.S.C. § 636(c) (Docs. 8, 17). 

After reviewing the parties’ submissions, the Court finds that Plaintiff has failed to 

set forth facts in his Verified Complaint that, if true, set forth a cause of action in Counts 

I-VII. Nor can the deficiency be cured by amendment. Therefore, Defendant’s Motion 

to Dismiss (Doc. 24) will be granted. The Court will dismiss the Complaint (Doc. 1) 
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with prejudice.

I. DISCUSSION

A. Fed. R. Civ. P. 12(b)(6)

Fed. R. Civ. P. 12(b)(6) is designed to “test[] the legal sufficiency of a claim.” 

Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). A Rule 12(b)(6) dismissal for 

failure to state a claim can be based on either (i) the lack of a cognizable legal theory or 

(ii) insufficient facts to support a cognizable legal claim. Conservation Force v. Salazar, 

646 F. 3d 1240, 1242 (9th Cir. 2011), cert. denied, Blasquez v. Salazar, 132 S. Ct. 1762 

(2012). In deciding a Rule 12(b)(6) motion to dismiss, courts must consider all well-pled 

factual allegations in the Complaint as true and interpret them in a light most favorable to 

the non-moving party. Schlegel v. Wells Fargo Bank, NA, 720 F.3d 1204, 1207 (9th Cir. 

2013). While “a complaint need not contain detailed factual allegations . . . it must plead 

‘enough facts to state a claim to relief that is plausible on its face.’” Clemens v. Daimler 

Chrysler Corp., 534 F.3d 1017, 1022 (9th Cir. 2008) (quoting Bell Atl. Corp. v. Twombly, 

550 U.S. 544, 570 (2007). “[A] well-pleaded complaint may proceed even if it strikes a 

savvy judge that actual proof of those facts is improbable, and ‘that a recovery is very 

remote and unlikely.’” Twombly, 550 U.S. at 556 (quoting Scheuer v. Rhodes, 416 U.S. 

232, 236 (1974)). “[F]or a complaint to survive a motion to dismiss, the non-conclusory 

‘factual content,’ and reasonable inferences from that content, must be plausibly 

suggestive of a claim entitling the plaintiff to relief.” Moss v. U.S. Secret Serv., 572 F.3d 

962, 969 (9th Cir. 2009) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). In other 

words, the complaint must contain enough factual content “to raise a reasonable 

expectation that discovery will reveal evidence” of the claim. Twombly, 550 U.S. at 556. 

Legal conclusions couched as factual allegations are not given a presumption of 

truthfulness, and “conclusory allegations of law and unwarranted inferences are not 

sufficient to defeat a motion to dismiss.” Pareto v. FDIC, 139 F.3d 696, 699 (9th Cir. 

1998).
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B. Factual Allegations Assumed to Be True

The Court assumes as true all well-pled factual allegations contained in Plaintiff’s 

Verified Complaint and draws all reasonable inferences therefrom. For purposes of this 

Fed. R. Civ. P. 12(b)(6) Motion to Dismiss, the Court disregards any of the Defendant’s 

factual contentions to the contrary. See, e.g., Lee v. City of L.A., 250 F.3d 668, 688 (9th 

Cir. 2001) (“[F]actual challenges to a plaintiff's complaint have no bearing on the legal 

sufficiency of the allegations under Rule 12(b)(6).”). However, the Court may still 

consider any internal discrepancies or factual conflicts it finds within the Complaint that 

undermine its plausibility. See, e.g., Maloney v. Scottsdale Ins. Co., 256 F. App'x 29, 31–

32 (9th Cir. 2007) (finding that a complaint failed to state a claim upon which relief could 

be granted based upon factually inconsistent allegations in a complaint that were not 

pleaded in the alternative, but incorporated into each cause of action). 

The Court also takes judicial notice of the documents attached to the Motion to 

Dismiss that were filed with the Maricopa County Recorder as they (i) are not subject to 

reasonable dispute, (ii) are generally known within the territorial jurisdiction of this 

Court, and (iii) can be accurately and readily determined from sources whose accuracy 

cannot reasonably be questioned pursuant to Fed. R. Evid. 201(b). The Court may 

consider matters of public record as well as material properly submitted as part of a 

complaint when deciding a motion to dismiss without converting the motion into a 

motion for summary judgment. See Lee, 250 F.3d at 688-89 (noting that the court may 

take judicial notice of undisputed “matters of public record”); Barron v. Reich, 13 F. 3d 

1370, 1377 (9th Cir. 1994). 

On March 7, 2013, Plaintiff signed a promissory note secured by a recorded Deed 

of Trust for the purchase of a home in Avondale, Arizona. Defendant is the named 

beneficiary on the Deed of Trust. Plaintiff failed to make payments due on his note.

1

 

 

1 Though Plaintiff argues that he was not in default based upon a “show me the note” theory, as a matter of law Plaintiff’s theory has been soundly rejected by this Court. 

See Diessner v. Mortgage Elec. Registration Sys., 618 F. Supp. 2d 1184, 1187 (D. Ariz. 2009) (“Arizona’s non-judicial foreclosure statute does not require presentation of the original note before commencing foreclosure proceedings.”); Kane v. Bosco, No. 10–
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Plaintiff submitted a loan modification application under the Home Affordable 

Modification Program (“HAMP”) to Defendant in June 2014. 

The trustee under the Deed of Trust commenced a non-judicial foreclosure against 

the property. A Notice of Trustee’s Sale was executed on September 30, 2014 and sent to 

Plaintiff at the address of the property which was Plaintiff’s address of record at the time. 

On December 27, 2014, Defendant also sent Plaintiff a letter notifying Plaintiff that it 

could not complete a review of his account for a loan modification because “[o]ur records 

indicate there are less than 15 days before the scheduled foreclosure sale of the abovereferenced property.” (Doc. 33 at 23). Plaintiff received the December 27, 2014 letter, 

acknowledging that it gave Plaintiff “his FIRST real indication of an impending Trustee 

Sale.” (Doc. 33 at 2). 

The property was sold at a public foreclosure auction on January 9, 2015. Plaintiff 

did not seek an injunction prior to the sale. Defendant, as the foreclosing beneficiary 

under the Deed of Trust, purchased the property and recorded a Trustee’s Deed Upon 

Sale with the Maricopa County Recorder on January 21, 2015. Plaintiff filed a Verified 

Complaint in Maricopa County Superior Court on September 8, 2015 contesting the sale 

of his home. The case was removed to U.S. District Court on October 12, 2015. Plaintiff 

requests that the Court: (i) void the trustee’s sale of his home and transfer title of the 

home to Plaintiff free and clear of any liens; (ii) declare the promissory note paid in full 

and all amounts due under the note null and void; (iii) award Plaintiff compensatory 

damages in the amount of $150,000 or a greater amount proven at trial; (iv) award 

Plaintiff punitive damages; and (v) award Plaintiff reasonable attorney’s fees and costs of 

suit.

 CV–01787–PHX–JAT, 2010 WL 4879177 (D. Ariz. Nov. 23, 2010) (agreeing “with the 

unanimous authority within the District of Arizona” that a plaintiff’s “show me the note” 

argument is meritless); Hogan v. Wash. Mut. Bank, N.A., 277 P.3d 781, 783 (Ariz. 2012) 

(“[T]he deed of trust statutes impose no obligation on the beneficiary to ‘show the note’ 

before the trustee conducts a non-judicial foreclosure.”). Based upon the undisputed factual record, the Court finds that Plaintiff defaulted on the note.
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C. Analysis

1. The Complaint Fails to Satisfy the Pleading Requirements Set 

Forth in Fed. R. Civ. P. 8

Plaintiff’s Complaint alleges the following causes of action: (1) declaratory relief 

and quiet title; (2) promissory estoppel; (3) fraud; (4) wrongful foreclosure; (5) breach of 

covenant of good faith and fair dealing; (6) unjust enrichment; and (7) a violation of the 

Real Estate Settlement Procedures Act of 1974 (“RESPA”), 12 U.S.C. § 2601 et seq.

Specifically, Plaintiff claims that he made a loan modification application with the 

Defendant but “never got a response from Caliber as to said modification.” (Doc. 1-1 at 

6-7). However, Plaintiff also asserts that he met the qualifications for a loan modification 

and was induced to act by false, deceptive, misleading promises made by the Defendant. 

Plaintiff states that Defendant assured Plaintiff that if he made an application and 

“successfully completed his trial payment plan his mortgage would be modified and he 

would not be foreclosed on.” (Id. at 11). Plaintiff alleges that Defendant breached its 

duty of care to Plaintiff and the implied covenant of good faith and fair dealing by 

exercising its foreclosure power despite Plaintiff’s “making application and providing 

Defendant with everything they asked of him including timely fulfillment of his 

payments under the plan.” (Id.). Plaintiff finally claims that the foreclosure should not 

have gone forward with “an active and timely loss mitigation application pending.” (Id. at 

12). The Court finds that Plaintiff’s conclusory allegations regarding Defendant’s 

response to Plaintiff’s mitigation loss application are internally inconsistent, not pled in 

the alternative, and negatively impact the plausibility of Plaintiff’s Verified Complaint.

The Court further finds that the Complaint fails to comply with the pleading standards set 

forth in Fed. R. Civ. P. 8. See Nevijel v. N. Coast Life Ins. Co., 651 F.2d 671, 673–74 

(9th Cir. 1981) (affirming dismissal of complaint that was “verbose, confusing and 

almost entirely conclusory”). The Court will not provide Plaintiff leave to amend the 

Complaint as amendment would be a futile act for the reasons discussed below.
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2. The Claims in the Complaint are Waived Pursuant to A.R.S. § 33-

811(C)

The Arizona Supreme Court has unequivocally held that a trustor “who has 

defenses or objections to a properly noticed trustee’s sale has one avenue for challenging 

the sale: filing for injunctive relief.” BT Capital, LLC v. TD Serv. Co. of Arizona, 275 

P.3d 598, 600 (2012). ARIZ. REV. STAT. § 33-811(C) provides in relevant part:

The trustor, its successors or assigns, and all persons to whom 

the trustee mails a notice of a sale under a trust deed pursuant 

to § 33–809 shall waive all defenses and objections to the 

sale not raised in an action that results in the issuance of a 

court order granting relief pursuant to rule 65, Arizona rules 

of civil procedure, entered before 5:00 p.m. Mountain 

standard time on the last business day before the scheduled 

date of the sale . . . .

Pursuant to ARIZ. REV. STAT. § 33-811(C), if the trustor fails to obtain an injunction prior 

to the trustee’s sale of the property, the trustor has waived all pre-sale defenses and 

objections to the sale. Id.; see also Tapper v. Deutsche Bank National Trust Company, 

No. CV-11-00088-PHX-ROS, 2012 WL 12501082, at *2 (D. Ariz. June 20, 2012) (“If a 

trustee’s sale is completed, A.R.S. § 33-811(C) means ‘a person...cannot later challenge 

the sale based on pre-sale defenses or objections.’”) (quoting BT Capital, LLC, 275 P.3d 

at 600). 

In Madison v. Groseth, 279 P.3d 633, 637 (Ariz. Ct. App. 2012), the Arizona 

Court of Appeals held that § 33-811(C) also applies to tort claims based on objections to 

the validity of the trustee’s sale. In addition, the waiver under § 33-811(C) includes any 

claim for damages that is dependent on the foreclosure sale. See Morgan AZ Financial, 

LLC v. Gotses, 326 P.3d 288, 290-91 (Ariz. Ct. App. 2016) (“Under A.R.S. § 33–811(C), 

a trustor who fails to enjoin a trustee’s sale waives his claims to title of the property upon 

the sale’s completion . . . and also waives any claims that are dependent on the sale[.]”) 

(emphasis added) (citations omitted); see also Madison, supra; Tapper, 2012 WL 

12501082 at *2. ARIZ. REV. STAT. § 33-811(C), however, does not restrict claims for 
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relief that are independent of voiding the trustee’s sale. See Snyder v. HSBC Bank, USA, 

N.A., 913 F.Supp.2d 755, 770 (D. Ariz. 2012), appeal dismissed (Dec. 10, 2013).

Pursuant to § 33-809(B), the trustee must mail the Notice of Trustee Sale to each 

person with an interest in the property to the address listed in the county records. In 

analyzing the issue of notice, the Madison Court held that § 33-811(C) “does not require 

the trustee to comply with the mailing requirements of § 33-809 for the waiver provision 

to apply later to the trustor.” Madison, 279 P.3d at 637. Therefore, regardless of whether 

the Notice of Trustee Sale has been served on the trustor pursuant to § 33-809, § 33-

811(C) waives the trustor’s defenses and objections. Id. (“Although § 33–809(C) 

mandates service on trustors, we decline to interpret the reference to § 33–809 in § 33–

811(C) as requiring service on trustors as a prerequisite to application of the waiver 

provision . . . .”). However, noting that the plaintiff had received sufficient notice to 

object to the foreclosure before it occurred, the Madison Court in dicta recognized that 

it’s interpretation of § 33-811(C) could “deprive a trustor of due process if that trustor is 

not given sufficient notice of the trustee’s sale to obtain an injunction to the sale.” Id. 

Here, it is undisputed that Plaintiff defaulted on his promissory note. It is 

undisputed that notice of the trustee’s sale was sent to Plaintiff’s address of record at the 

time the notice was issued as required by ARIZ. REV. STAT. § 33-809(B) and that actual 

notice was received by Plaintiff in time to seek a preliminary injunction against the sale. 

It is also undisputed that Plaintiff did not seek, much less obtain, a preliminary injunction 

prior to the foreclosure sale pursuant to Arizona Rule of Civil Procedure 65. 

Reading the Complaint in a light most favorable to the Plaintiff, and assuming as 

true all well-pled factual allegations, the Court concludes that Counts I-VII in Plaintiff’s 

Complaint are all based on facts which could have been raised as a defense or objection 

to the trustee’s sale. Further, all of the claims in the Complaint challenge the foreclosure 

sale and are founded upon the sale’s alleged invalidity. See Glava v. JPMorgan Chase 

Bank, N.A., No. 1 CA–CV 13–0719, 2015 WL 849685, at *4 (Ariz. Ct. App. Feb. 26, 

2015) (concluding that a borrower’s claims for breach of contract, breach of the duty of 
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good faith and fair dealing, fraud, consumer fraud, breach of a fiduciary relationship, and 

intentional infliction of mental distress were not waived pursuant to ARIZ. REV. STAT. § 

33-811 where the claims did “not challenge the sale and [were] not founded upon the 

sale’s invalidity.”).

For instance, Count I asserts that the foreclosure should be declared void.2

 The 

claim for promissory estoppel (Count II) alleges the trustee’s sale constituted a breach of 

a promise that the loan modification process would “avert a foreclosure.” The claim for 

fraud (Count III) alleges that the trustee’s sale should not have occurred because a loan 

modification application was fraudulently induced.3

 Count IV asserts “wrongful 

foreclosure” and alleges that the foreclosure was illegal.4

 The claim for breach of the 

covenant of good faith and fair dealing (Count V) alleges the trustee’s sale violated an 

oral5 or written contractual agreement that Plaintiff’s completion of his “trial payment 

plan” would result in a loan modification and foreclosure would not occur. The claim for 

unjust enrichment (Count VI)6 alleges that Defendant was unjustly enriched by the 

 

2 Count I is styled as an action for declaratory relief and quiet title. See Zubia v. 

Shapiro, No. 1 CA-CV 15-0404, 2016 WL 5462039, at *3 (Ariz. Ct. App. Sept. 29, 2016) (affirming trial court’s dismissal of a quiet title claim under ARIZ. REV. STAT. § 33- 811(C)). As explained below, Count I may be alternatively dismissed as Plaintiff has not tendered the amount due on the mortgage.

3 The fraud claim is insufficient on its face pursuant to Fed. R. Civ. P. 9(b). Fed. 

R. Civ. P. 9(b) requires Plaintiff to state with particularity the circumstances that constitute the fraud, pleading such matters as the time, place and content of each false representation, the name and authority of the speaker, the misrepresented fact, 

Defendant’s knowledge of its falsity, an intent to defraud, justifiable reliance, and 

damages. See Semegen v. Weidner, 780 F.2d 727, 731(9th Cir. 1985).

4 The Arizona Court of Appeals has explained that a claim for wrongful foreclosure, assuming that it is a cognizable legal theory, is “subject to the statutory 

requisites of A.R.S. § 33–811(C) and thus barred for failing to seek the required injunctive relief.” Zubia, 2016 WL 5462039, at *3. 

5 “Absent a written agreement to modify the loan, any claim based upon an oral contract to modify the loan is barred by the statute of frauds.” Khan v. CitiMortgage, Inc., 975 F. Supp. 1127, 1137 (E.D. Calif. Sept. 30, 2013). 

6 The unjust enrichment claim is insufficient on its face pursuant to Fed. R. Civ. P. 8. Fed. R. Civ. P. 8 requires that a cause of action be pled with more than conclusory allegations. An unjust enrichment claim requires proof of five elements: “(1) an enrichment, (2) an impoverishment, (3) a connection between the enrichment and 

impoverishment, (4) the absence of justification for the enrichment and impoverishment, 
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foreclosure itself which should not have occurred. The RESPA claim (Count VII) alleges 

that the foreclosure should not have gone forward because Plaintiff submitted a loan 

modification application. 

The Court concludes that Plaintiff has waived his claims for relief alleged in 

Counts I-VII pursuant to ARIZ. REV. STAT. § 33-811(C). See Steinberger v. McVey, 318 

P.3d 419, 430 (Ariz. Ct. App. 2014) (“Pursuant to A.R.S. § 33-811(C), once a nonjudicial foreclosure sale has taken place, the only defense that may be raised is lack of 

notice of the sale.”). The Court finds that leave to amend would be futile as no additional 

facts would undo the waiver of these claims. See Margaritis v. U.S .Bank, N.A., 579 F. 

App’x 590, 591 (9th Cir. 2014). The Complaint will be dismissed with prejudice.

3. Alternate Grounds for Dismissing Plaintiff’s Claims

i. HAMP Does Not Provide a Private Right of Action

The gravamen of Counts I-VI in the Complaint is Plaintiff’s claim that he was 

entitled to a loan modification pursuant to HAMP. All counts in the Complaint 

incorporate by reference the following allegation:

Under the FHA HAMP Program and Defendants contract 

with the federal government as to same, foreclosure actions 

by servicers must be postponed for all borrowers who meet 

minimum FHA HAMP eligibility requirements. Not only did 

plaintiff meet the minimum requirements he was entitled to 

the issuance of the modification.

(Doc. 1-1 at 7).

Congress created HAMP under the Emergency Economic Stabilization Act of 

2008, Pub.L. 110–343. See also 12 U.S.C.A. § 5219. HAMP was established to help 

struggling homeowners avoid foreclosure through loan modifications. Rush v. Mac, 792 

F.3d 600, 605-06 (6th Cir. 2015). If a borrower qualifies for a HAMP loan modification, 

the borrower does not automatically get a modification. Wigod v. Wells Fargo Bank, 

N.A., 673 F.3d 547, 557 (7th Cir. 2012). Instead, the servicer first “implement[s] a Trial 

Period Plan (“TPP”) under the new loan repayment terms it formulated” according to 

 and (5) the absence of a remedy provided by law.” Freeman v. Sorchych, 245 P.3d 927, 

936 (Ariz. Ct. App. 2011).
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the HAMP guidelines. Id. If a borrower successfully completes the conditions of the 

TPP, then the servicer has to offer a permanent modification. Id. 

“[M]ost district courts in the Ninth Circuit, as well as the Seventh and Eleventh 

Circuit Courts of Appeals, have held that even though entering into the HAMP [Servicer 

Participation Agreement] imposes certain obligations on participating servicers and 

lenders to take steps to avoid foreclosures, agreements under the HAMP [Servicer 

Participation Agreement] do not provide an express or implied private right of action for 

borrowers as third party beneficiaries.” Kimball v. Flagstar Bank F.S.B., 881 F.Supp.2d 

1209, 1224 (S.D. Cal. 2012); see also Casault v. Fed.Nat'l Mortg. Ass'n, 915 F. Supp. 2d

1113, 1123 n.8 (C.D. Cal. 2012) (“[I]t is well established that there is no private cause of 

action under HAMP.”); Simon v. Bank of Am., N.A., No. 10–cv–00300–GMN–LRL, 2010 

WL 2609436, at *7 (D. Nev. June 23, 2010) (“[C]ourts have consistently held that 

[HAMP] does not provide borrowers with a private cause of action against lenders for 

failing to consider their application for loan modification, or even to modify an eligible 

loan.”). Courts have recognized that “it would be unreasonable for a qualified borrower 

seeking a loan modification to rely on the HAMP servicer's agreement as granting him 

enforceable rights since the agreement does not actually require that the servicer modify 

all eligible loans.” Kimball, 881 F. Supp. at 1224 (internal quotation marks and citation 

omitted). 

Based on the foregoing authority, because Counts I-VI are premised on Plaintiff’s 

assertion that he was entitled to a loan modification, the counts must be dismissed for 

lack of a private right of action under HAMP. See, e.g., Ruvalcaba v. Citibank 

CitiMortgage, Inc., CV 12-4655-JFW (AJWx), 2012 WL 12894753, at *4 (C.D. Cal. 

2012) (dismissing with prejudice “all of Plaintiff's claims predicated on a violation 

of HAMP,” which included “(1) breach of contract; (2) breach of the covenant of good 

faith and fair dealing; (3) fraud, deceit and/or negligent misrepresentation; (4) negligence; 

(5) wrongful foreclosure; and (6) violation of unfair competition law.”); Marks v. Bank of 

America, No. 3:10-cv-08039-PHX-JAT, 2010 WL 2572988, at *6 (D. Ariz. June 22, 
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2010) (“Because Plaintiff is precluded from asserting a private cause of action under the 

HAMP, even disguised as a breach of contract claim, Defendant's Motion to Dismiss is 

warranted.”); Manabat v. Sierra Pac. Mortg. Co., 2010 WL 2574161 at *11 (E.D. Cal., 

June 25, 2010) (dismissing plaintiff’s wrongful foreclosure claim because there is no 

private right of action for HAMP violations against lenders that 

receive HAMP funds); Solomon v. Aurora Loan Services LLC, No. CIV. 2:12–209 WBS 

KJN, 2012 WL 2577559, *5 (E.D. Cal. July 3, 2012) (“[T]o the extent that plaintiff bases 

her negligence claim on an alleged entitlement to a modification under HAMP, her claim 

is an improper attempt to privately enforce HAMP when Congress granted no such 

private right of action.”); Cleveland v. Aurora Loan Services, LLC, No. C 11–0773 PJH,

2011 WL 2020565, at *5 (N.D. Cal. May 24, 2011) (because a borrower is not a thirdparty beneficiary of any HAMP contract between a servicer or lender and the 

government, a borrower “has no standing to assert a claim of breach of contract 

or promissory estoppel based on alleged HAMP violations . . . .”).

ii. Count I: Declaratory Relief and Quiet Title

“A quiet title action seeks a judicial determination of adverse claims in order to 

clear the title of disputed property.” Cook v. Town ofPinetop–Lakeside, 303 P.3d 67, 70 

(Ariz. Ct. App. 2013) (citing 74 C.J.S. Quieting Title § 1 (2013)). “In Arizona, 

the quiet title action is codified in A.R.S. § 12–1101 (2003).” Id. ARIZ. REV. STAT. § 

12–1101 provides that: 

An action to determine and quiet title to real property may be 

brought by any one having or claiming an interest therein, 

whether in or out of possession, against any person or the 

state when such person or the state claims an estate or interest 

in the real property which is adverse to the party bringing the 

action.

A plaintiff bringing a quiet title action must allege (i) his or her ownership of the property 

and (ii) an adverse claim by the defendant. Palmer v. Sunnyside, 61 P.2d 444, 448 (1936) 

(“[U]nder the law the plaintiff in [a quiet title action] is not required to do anything more 

than allege his ownership of the property and the adverse claim of defendant . . . .”). The 
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defendant then must prove title. Id. In Arizona, “a plaintiff cannot bring a quiet title 

action unless she [or he] has paid off her [or his] mortgage in full.” Bergdale v. 

Countrywide Bank FSB, No. CV–12–8057–PCT–GMS 2012 WL 4120482, at *6 (D. 

Ariz. Sept. 18, 2012) (citing Farrell v. West, 114 P.2d 910, 911 (Ariz. 1941) (“[I]f it 

appears there is an unsatisfied balance due a defendant-mortgagee, or his assignee, the 

court will not quiet the title until and unless [the plaintiff-mortgagor] pays off such 

mortgage lien.”)); see also Allison v. State, 420 P.2d 289, 292 (Ariz. 1966) (en banc) (“In 

any action to quiet title, a plaintiff must succeed on the strength of his own title rather 

than the weakness of his adversary’s.”). 

Plaintiff has not tendered the amount owed on the mortgage on the property at 

issue. See Farrell, 114 P.2d 910 (1941) (refusing to quiet title until and unless the 

plaintiff tenders the amount owed, as required in equity). Therefore, dismissal of Count I

is warranted on this alternate ground.

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iii. Count IV: Wrongful Foreclosure

The Court finds that Plaintiff’s claim for wrongful foreclosure fails as the claim 

lacks a cognizable legal theory. “Arizona has not recognized a cause of action for 

wrongful foreclosure.” Zubia, 2016 WL 5462039, at *3 (citing In re Mortg. Electronic 

Registration Systems, Inc., 754 F. 3d 772, 784 (9th Cir. 2014) (“Arizona, though a 

nonjudicial foreclosure state, has not recognized the tort of wrongful foreclosure.”). 

“Although a federal court exercising diversity jurisdiction is ‘at liberty to predict the 

future course of [a state's] law,’ plaintiffs choosing ‘the federal forum . . . [are] not 

entitled to trailblazing initiatives under [state law].’” Cervantes v. Countrywide Home 

Loans, Inc., 656 F. 3d 1034, 1043 (9th Cir. 2011) (quoting Ed Peters Jewelry Co. v. C & 

J Jewelry Co., Inc., 124 F.3d 252, 262–63 (1st Cir. 1997) (affirming dismissal of a 

wrongful foreclosure claim when no such action existed under state law)). Even 

 

7 The Court need not address the claim for declaratory relief as under Arizona law, a declaratory judgment action is not a separate cause of action, but a remedy for 

an underlying cause of action. See Steers v. CitiMortgage, Inc., No. CV–11–1144–PHX– GMS, 2011 WL 6258219, at *3 (D.Ariz. Dec. 15, 2011) (citation omitted). Since the 

underlying cause of action fails, the declaratory judgment action also fails.
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assuming that a cause of action for wrongful foreclosure does exist, which it currently 

does not, the Ninth Circuit has recognized that the likely elements of such a claim are a 

lack of default, or tender to cure the default, or an excuse from the tender requirement. In 

re Mortg. Electronic Registration Systems, Inc., 754 F.3d at 784; see also Herring v. 

Countrywide Home Loans, Inc., No. 06-2622, 2007 WL 2051394, at *6 (D. Ariz July 13, 

2007) (creating from A.R.S. § 33-870(A) a duty of care by a trustee to exercise the power 

to sell fairly and in good faith). To allow a cause of action for wrongful foreclosure in 

this case, the Court would have to extend the duty of care to include the beneficiary of the 

deed of trust. It has been stated that the tort of wrongful disclosure is ripe after a 

foreclosure sale has occurred. See Jones v. Bank of America, N.A., No. CV–09–2129–

PHX–JAT, 2010 WL 2228517, at *3 (D. Ariz. June 1, 2010). 

Even if the Court concluded that wrongful foreclosure is a cause of action under 

Arizona law, and assuming as true all of Plaintiff’s well-pled facts, the facts alleged fail 

to support a legal claim. Plaintiff was in default. He did not tender to cure the default, 

nor is he excused from doing so. The trustee’s sale was conducted in accordance with the 

law. Therefore, dismissal of Count IV is warranted even if Plaintiff’s claims are not 

waived under ARIZ. REV. STAT. § 33-811(C).

iv. Count VII: RESPA

RESPA “regulates the market for real estate ‘settlement services’ . . . .” Freeman 

v. Quicken Loans, Inc., ––– U.S. ––––, 132 S.Ct. 2034, 2037–38, 182 L.Ed.2d 955 (2012)

(quoting 12 U.S.C. 2602(3)). “Settlement service means any service provided in 

connection with a prospective or actual settlement[.]” 24 C.F.R. § 3500.2. Settlement 

means “the process of executing legally binding documents regarding a lien on property 

that is subject to a federally related mortgage loan. This process may also be called 

‘closing’ or ‘escrow’ in different jurisdictions.” Id. Congress’ purpose in enacting 

RESPA was to ensure consumer protection for borrowers interacting with entities 

servicing federally related mortgage loans. See McLean v. GMAC Mortg. Corp., 398 

Fed. Appx. 467, 471 (11th Cir. 2010) (citing 12 U.S.C. § 2605). Specifically, Congress 
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intended RESPA to effect changes in the settlement process by (i) providing advance 

disclosure of settlement costs to home buyers, (ii) “eliminat[ing] . . . kickbacks or referral 

fees that tend to increase unnecessarily the costs of certain settlement services[,]” (iii) 

reducing the amount of money home buyers must place in escrow accounts for the 

payment of their real estate taxes and home insurance, and (iv) modernizing land title 

record keeping. 12 U.S.C. 2601(b). 

RESPA also prescribes actions to be followed by loan servicers in responding to 

loan modification requests. See Miller v. Bank of New York Mellon, No. 2:16-cv-493-

FrM-99MRM, 2017 WL 88946, at *2 (M.D.Fla. Jan. 10, 2017) (finding that plaintiff 

failed to submit a loss mitigation application that would have triggered the mortgage 

servicer’s obligations under the regulation). These prescribed actions are set forth in the 

Mortgage Servicing Rules Under the Real Estate Settlement Procedures Act (Regulation 

X) promulgated by the Consumer Financial Protection Bureau (“CFPB”) pursuant to the 

Dodd–Frank Wall Street Reform and Consumer Protection Act, 12 U.S.C.§ 5581, and 

RESPA. Regulation X became effective on January 10, 2014. 78 FR 10696–01 

(February 14, 2013) (codified at 12 C.F.R. pt. 1024). Regulation X, Subpart C requires a 

mortgage servicer to respond in a timely manner to a borrower who submits a completed 

loan modification, or loss mitigation, application. 12 C.F.R. § 1024.41(b)(2)(i)(B), (c), 

and (d). In pertinent part, Regulation X further provides that if a borrower submits a 

“complete loss mitigation application” before a servicer has made the first notice or filing 

required by applicable law for any judicial or non-judicial foreclosure process, a servicer 

shall not make the first notice or filing required by applicable law for any judicial or nonjudicial foreclosure process unless (1) the servicer informs the borrower that the borrower 

is not eligible for any loss mitigation option (and any appeal has been exhausted), (2) a 

borrower rejects all loss mitigation offers, or (3) a borrower fails to comply with the 

terms of a loss mitigation option such as a trial modification. 12 C.F.R. § 1024.41(f)(2). 

However, none of the loss mitigation procedures apply to a loss mitigation application 

received 37 days or less before a foreclosure sale. 12 C.F.R. § 1024.41(f), (g). 
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Regulation X defines “complete loss mitigation application” as “an application in 

connection with which a servicer has received all the information that the servicer 

requires from a borrower in evaluating applications for the loss mitigation options 

available to the borrower.” 12 C.F.R. § 1024.41(b)(1). If an application is incomplete, 

“[a] servicer shall exercise reasonable diligence in obtaining documents and information 

to complete a loss mitigation application.” Id. “Once the borrower submits the requested 

materials or if the servicer initially determines that the application is complete, then the 

application is considered ‘facially complete’ for purposes of § 1024.41.” Lage v. Ocwen 

Loan Servicing LLC, 839 F.3d 1003, 1006 (11th Cir. 2016) (quoting 12 C.F.R. § 

1024.41(c)(2)(iv)).

Nothing in § 1024.41 imposes a duty on a mortgage servicer to offer a borrower a 

particular loss mitigation option. 12 C.F.R. § 1024.41(a). Nor does § 1024.41 “create a 

right for a borrower to enforce the terms of any agreement between a servicer and the 

owner or assignee of a mortgage loan, including with respect to the evaluation for, or 

offer of, any loss mitigation option . . . .” Id.

However, “[a] borrower may enforce the provisions of [12 C.F.R. § 

1024.41] pursuant to section 6(f) of RESPA (12 U.S.C. § 2605(f)).” 12 C.F.R. § 

1024.41(a); see also Lage v.Ocwen Loan Servicing LLC, 839 F.3d 1003, 1007 (11th Cir. 

2016) (“If a servicer fails to evaluate a borrower’s loss mitigation application within 30 

days [pursuant to § 1024.41(c)(1)], the borrower has a private right 

of action under RESPA.”) (citing 12 C.F.R. § 1024.41(a)); Smith v. Nationstar Mortg., 

Case No. 15-13019, 2015 WL 7180473, at *4 (E.D. Mich. Nov. 16, 2015) (recognizing 

that 12 C.F.R. § 1024.41 provides a private cause of action). Under 12 U.S.C. § 2605(f), 

an individual may recover

an amount equal to the sum of . . . any actual damage to the 

borrower as a result of the failure [] and . . . any additional 

damages, as the court may allow, in the case of a pattern or 

practice of noncompliance with the requirements of this 

section, in an amount not to exceed $2,000.

12 U.S.C. § 2605(f)(1). If the borrower’s suit under 12 U.S.C. § 2605 is successful, the 
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borrower is entitled to “the costs of the action, together with any attorneys fees incurred 

in connection with such action as the court may determine to be reasonable under the 

circumstances.” 12 U.S.C. § 2605(f)(3).

Damages are “an essential element” of a RESPA claim. Renfroe v. Nationstar 

Mortg., LLC, 822 F.3d 1241, 1246 (11th Cir. 2016). As stated above, RESPA recognizes 

two types of damages: (1) actual damages the borrower sustained as a result of 

the RESPA violation and (2) “any additional damages, as the court may allow, in the case 

of a pattern or practice of noncompliance with the requirements of this section, in an 

amount not to exceed $2,000.” 12 U.S.C. § 2605(f)(1). “Though there is no magic 

number of violations that create a ‘pattern or practice of noncompliance,’ courts have 

held that two violations of RESPA are insufficient to support a claim for statutory 

damages.” Renfroe v. Nationstar Mortg., LLC, 822 F.3d 1241, 1247 (11th Cir. 2016) 

(quoting Kapsis v. Am. Home Mortg. Servicing Inc., 923 F.Supp.2d 430, 445 (E.D.N.Y.

2013).

The Court finds that the Complaint fails to sufficiently allege that Plaintiff 

submitted a “complete loss mitigation application” more than 37 days before the 

foreclosure sale. See Lage, 839 F.3d at 1009 (a loan servicer's duty to evaluate a 

borrower's loss mitigation application, “is only triggered when the borrower submits a 

‘complete loss mitigation application more than 37 days before a foreclosure 

sale.’”) (quoting 12 C.F.R. § 1024.41(c)(1)); Gelinas v. Bank of America, N.A., No.16-

1355-RAJ, 2017 WL 1153859, at *4 (W.D. Wash. Mar. 28, 2017) (“The language of the 

provision plainly establishes that a ‘complete loss mitigation application’ is required for 

the RESPA provision to apply.”). In addition, the Court finds that the Complaint fails to 

sufficiently allege damages. Corazzini v. Litton Loan Servicing LLP, No. 09 Civ. 199 

(MAD) (ATB), 2010 WL 6787231, at *12 (N.D.N.Y. June 15, 2011) (“[T]he courts have 

consistently dismissed complaints under RESPA if they do not allege actual damages or 

state merely that in a conclusory fashion the defendant caused damages to the plaintiff[.]” 

(citation and internal quotation marks omitted)). Even if not waived under ARIZ. REV.
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STAT. § 33-811, the RESPA claim in Count VII must be dismissed for failure to state a 

claim that is plausible on its face. Twombly, 550 U.S. at 568. 

II. CONCLUSION

For the reasons set forth herein, 

IT IS ORDERED granting Defendant’s Motion to Dismiss (Doc. 24). 

IT IS FURTHER ORDERED dismissing with prejudice the Plaintiff’s Verified 

Complaint (Doc. 1-1 at 5-16). 

The Clerk of Court shall terminate this case. 

 Dated this 20th day of June, 2017.