Court Opinion

ID: 2686285
Source: CourtListenerOpinion
Date Created: 2014-07-29 22:01:04.838851+00
Date Added: 2024-06-11T13:13:19.694049
License: Public Domain

Filed 7/29/14 Akinshin v. Bank of America CA1/2
                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                       FIRST APPELLATE DISTRICT

                                                  DIVISION TWO

WALTER AKINSHIN et al.,
         Plaintiffs and Appellants,
                                                                     A138098
v.
BANK OF AMERICA, N.A.,                                               (Marin County
                                                                     Super. Ct. No. CIV1103188)
         Defendant and Respondent.

         Walter and Nina Akinshin (the Akinshins, collectively, and Walter or Nina,
individually) sued Bank of America, N.A. (BANA), and others who are not parties to this
appeal, based on circumstances attendant to the 2007 refinance of their home mortgage
loan and their failed attempt to obtain a loan modification in 2010, after they had ceased
making their mortgage payments. The defendants successfully demurred to the
Akinshins’ original complaint and first amended complaint. The Akinshins filed a
second amended complaint (SAC), stating causes of action for fraud and deceit,
negligence, promissory estoppel, and violation of the Unfair Competition Law (UCL).
BANA again demurred and the trial court sustained the demurrer without leave to amend,
because causes of action based on the 2007 loan origination were time-barred and the
SAC otherwise failed to plead facts necessary to maintain the remaining causes of action.
The court subsequently dismissed the Akinshins’ lawsuit.
         On appeal, the Akinshins maintain that the statute of limitations should be tolled
by application of the discovery rule and that they alleged facts sufficient to maintain each
of their causes of action. We agree that the trial court erred in sustaining BANA’s

                                                             1
demurrer as to each of the causes of action stated in the SAC and reverse. Because all of
the causes of action survive without considering the allegations concerning the 2007 loan
origination, we do not reach the issue of whether remedies based on the loan origination
are time-barred.
                                    BACKGROUND
I. Factual Background 1
       In 2007, the Akinshins contacted Freedom Financial Center, Inc. (Freedom), a
mortgage broker, to refinance a prior mortgage loan on their residence at 28 Ayala Court,
San Rafael, California. They communicated primarily with Charles Teed.2 The
Akinshins told Charles that their combined monthly income was about $7,666 per month
from Nina’s work at Nordstrom’s and Walter’s work as the owner of a service station.
       On March 1, 2007, a uniform residential loan application was signed with the
Akinshins’ names but the Akinshins believe those signatures to be forgeries. The
application was prepared by William Teed as an employee of Freedom. A second loan
application was signed on March 21, 2007, this time by the Akinshins themselves. The
second application was also prepared by William, identified as an employee of
Countrywide Bank, FSB (Countrywide). Both applications indicated that the Akinshins
had a combined monthly income of $24,200.
       On March 18, 2007, the Akinshins received an $825,000 7-year fixed rate and 23-
year adjustable rate mortgage, as well as a $165,000 home equity line of credit (HELOC)
from Countrywide. The loan closing occurred at the Akinshins’ home with only the
Akinshins and a notary public present. The closing process lasted between 45 minutes
and one hour and no one explained the terms and consequences of the loan to the
Akinshins. The Akinshins were unaware that the loan contained a large balloon payment.

       1
          As we discuss below, in an appeal from the grant of a demurrer, we accept as
true the facts as stated in the complaint. Accordingly, the facts stated here are those
alleged in the SAC.
       2
         The Teed’s first names are used for the sake of clarity. No disrespect is
intended.

                                             2
Even though Charles told the Akinshins that the interest rate would be fixed for the first
seven years, their payments were to increase after three years. The “TILA disclosure
statement”3 also stated that the payments would be fixed for seven years.
       When the Akinshins realized they were receiving a HELOC, they called Charles
for clarification and left a message. Charles returned the call a few days later and said
that he did the best he could for the Akinshins, even though they had not previously
discussed a HELOC. Charles explained that the HELOC was necessary because the loan-
to-value ratio would be too high for the underwriters to grant the entire $880,000 loan
amount that the Akinshins had requested. Charles decided to obtain the HELOC to
reduce the size of the primary loan.
       Charles did not notify the Akinshins that he and Freedom would receive yield
spread premiums and other fees from Countrywide in the amount of $27,843.75.
       BANA is the successor in interest to Countrywide. At the end of 2008 and
beginning of 2009, the Akinshins contacted BANA for a loan modification. They
completed the loan modification application, but 30 days later were told they did not
qualify. In early 2009, the Akinshins worked with an organization called ACORN, to
which they paid no fees, to help them apply for a modification, but they were again
denied. In July 2009, the Akinshins hired a third party to help them obtain a
modification.
       In July or August 2009, the Akinshins stopped making their regular monthly
mortgage payment.
       In January 2010, Eric John, an employee of BANA, informed “Daly, agent for
plaintiffs” that the Akinshins qualified for a loan modification. On February 18, 2010,
“Gail #NBKRZVW,” an employee of BANA, informed Daly that the Akinshins qualified
for a loan modification so long as they made timely payments throughout a 90-day trial

       3
        The SAC does not define “TILA,” which we assume refers to the Truth in
Lending Act. (15 U.S.C. § 1601 et seq.)

                                             3
period. On the same day, Tiffany Fletcher, another employee of BANA, confirmed that
the Akinshins were accepted into the trial modification program.4
       On March 10, 2010, “Jacob #9359,” an employee of BANA, told Daly that the
Akinshins’ loan modification was under consideration. Jacob instructed Daly to call back
periodically.
       On May 14, 2010, Gail told Daly that the Akinshins qualified for a loan
modification and would receive the necessary paperwork. On the same day, a BANA
employee named Taz contacted the Akinshins, requested additional financial
documentation, and assured them that they qualified for a loan modification.
       The trial modification period was extended to end in December 2010. During the
trial modification period, the Akinshins timely made each payment of approximately
$1,891. The Akinshins made their final trial payment in December 2010, but BANA
denied them a permanent loan modification, stating that their income was insufficient.
BANA had been aware of the Akinshins’ income throughout the entire time that their
application for a loan modification was under consideration.
II. Procedural Background
       On June 24, 2011, the Akinshins filed a complaint, asserting nine causes of action
and naming as defendants BANA, as successor in interest of Countrywide; Freedom;
Charles; William; and BAC Home Loans Servicing, LP (BAC). On October 4, 2011,
BANA filed a demurrer, which the Akinshins opposed.
       On December 19, 2011, the Akinshins dismissed their suit against Charles.
       On February 23, 2012, the court sustained BANA’s demurrer with leave to amend.
The Akinshins then filed a first amended complaint, asserting five causes of action, with
BANA the only named defendant. On March 28, 2012, BANA filed a demurrer, which

       4
          The SAC contains no allegation that the trial modification program was related
to the federal government’s Home Affordable Modification Program (HAMP).
Accordingly, we regard the trial program at issue in this case as an in-house program that
is not governed by HAMP regulations.

                                            4
the Akinshins opposed. On July 17, 2012, the court sustained BANA’s demurrer, again
with leave to amend.
       In August 2012, the Akinshins filed the SAC. This complaint again named
BANA, Freedom, Charles, William, and BAC, even though no cause of action was
asserted against BAC. The complaint asserted four causes of action: (1) fraud and deceit
against Freedom, Charles, William, and BANA, but specifically alleging only statements
made in 2010 as being false or misleading; (2) negligence against BANA; (3) promissory
estoppel against BANA; and (4) violation of the UCL (Bus. & Prof. Code, § 17200 et
seq.) against BANA.
       The Akinshins attached a copy of the deed of trust as an exhibit to the SAC. The
deed of trust refers to an adjustable rate rider, which was not attached as an exhibit.
Although the allegations in the SAC refer to two uniform residential loan applications
and the TILA disclosure statement, these documents were also not attached as exhibits.
       In September 2012,5 BANA “for itself and as successor by merger to BAC Home
Loans Servicing, LP (sued erroneously as ‘Bank of America, NA as successor in interest
of Countrywide Bank, FSB’),” filed a demurrer to the SAC. The Akinshins opposed the
demurrer. In their opposition, the Akinshins noted that the first cause of action
incorporated the general allegations that preceded it and their arguments make clear their
intention that the first cause of action include alleged deceptive conduct and concealment
related to the 2007 loan origination, even though only alleged misrepresentations
concerning the 2010 loan modification application were directly included under the first
cause of action. As they had previously argued, the Akinshins maintained that the first
cause of action was not barred by the statute of limitations because “equitable tolling
under the discovery rule applies.”
       On December 14, 2012, the court sustained BANA’s demurrer without leave to
amend. The court stated that “[p]laintiffs do not explain how any claim arising from the

       5
          The demurrer in the record before us is internally dated September 26, 2012, but
a copy date-stamped by the clerk of the court to show the filing date was not provided in
parties’ appendices.

                                              5
loan origination would not be barred by the statute of limitations.” The court sustained
BANA’s demurrer to the first cause of action because BANA’s representations to the
Akinshins did not amount to a promise that BANA would grant a permanent loan
modification and the Akinshins also failed to plead facts demonstrating reliance. The
court sustained BANA’s demurrer to the second cause of action because the SAC “still
does not specify BANA’s alleged duty or the particular ‘conduct’ by BANA which was
negligent and caused plaintiffs harm.” The court sustained BANA’s demurrer to the third
cause of action because “the alleged promise continues to be unclear and ambiguous” and
the SAC failed to plead facts that demonstrated detrimental reliance. The court sustained
BANA’s demurrer to the fourth cause of action because any claim arising from the loan
origination would be time-barred, no facts were alleged to support other conclusory
allegations, and the cause of action was otherwise derivative to the other failed causes of
actions.
       On January 2, 2013, the Akinshins dismissed William and Freedom as defendants.
       On January 14, 2013, the court entered judgment, dismissing the Akinshins’ action
against BANA with prejudice.
       On March 8, 2013, the Akinshins timely filed a notice of appeal.
                                       DISCUSSION
       “On review from an order sustaining a demurrer, ‘we examine the complaint de
novo to determine whether it alleges facts sufficient to state a cause of action under any
legal theory, such facts being assumed true for this purpose.’ ” (Committee for Green
Foothills v. Santa Clara County Bd. of Supervisors (2010) 48 Cal.4th 32, 42.) We do not,
however, assume as fact contentions, deductions or conclusions of fact or law that may be
stated in the complaint. (Jenkins v. JPMorgan Chase Bank, N.A. (2013) 216 Cal.App.4th
497, 506.)
       In reviewing an order sustaining a demurrer, “we look ‘only to the face of the
pleadings and to matters judicially noticeable . . . .’ [Citation.] We are ‘not bound by the
trial court’s construction of the complaint . . . .’ [Citation.] Rather, we independently
evaluate the complaint, construing it liberally, giving it a reasonable interpretation, if

                                               6
possible, and reading it as a whole, while viewing its parts in context. [Citation.]” (Cobb
v. O’Connell (2005) 134 Cal.App.4th 91, 95.) “[A] demurrer [is not] the appropriate
procedure for determining the truth of disputed facts or what inferences should be drawn
where competing inferences are possible.” (CrossTalk Productions, Inc. v. Jacobson
(1998) 65 Cal.App.4th 631, 635.)
       We examine each of the Akinshins causes of action and conclude that even though
the SAC is not a model of clarity, the complaint alleges facts sufficient to state each
cause of action.
I. Fraud and Deceit
       “The elements of fraud, which give rise to the tort action for deceit, are (a)
misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of
falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance;
and (e) resulting damage.” (5 Witkin, Summary of Cal. Law (10th ed. 2005) Torts,
§ 772, p. 1121; see also Civ. Code, § 1709.)6 A plaintiff must plead “ ‘facts which “show
how, when, where, to whom, and by what means the representations were tendered.” ’
[Citation.] A plaintiff’s burden in asserting a fraud claim against a corporate employer is
even greater. In such a case, the plaintiff must ‘allege the names of the persons who
made the allegedly fraudulent representations, their authority to speak, to whom they
spoke, what they said or wrote, and when it was said or written.’ ” (Lazar v. Superior
Court (1996) 12 Cal.4th 631, 645.) Plaintiffs pleading fraud or deceit must also
“specifically allege their damages and how their reliance on [the misrepresentation]
caused those damages.” (Rossberg v. Bank of America, N.A. (2013) 219 Cal.App.4th
1481, 1501.)
       Among the SAC’s general allegations, the Akinshins alleged that BANA told them
that if they made timely payments during a trial modification period, they would be
granted a permanent loan modification. The Akinshins alleged four misrepresentations.

       6
         The Akinshins have not argued and the parties have not briefed an alternative
fraud claim based upon a promise made without intention to perform. Consequently we
do not examine the SAC for any such claim.

                                                 7
First, in January 2010, BANA informed the Akinshins’ agent that they “qualified” for a
loan modification. Second, in February 2010, BANA told the agent that the Akinshins
were accepted into a trial modification program and that they were “qualified” for a loan
modification if they made the trial payments. Third, in March 2010, while participating
in the trial modification program, BANA told the agent that the Akinshins’ loan
modification was being “considered.” Finally, in May 2010, BANA told the agent that
the Akinshins “qualified for a loan modification [and] would receive the necessary
paperwork” and on the same day separately asked for additional financial documentation
to support the application. In December 2010, BANA denied the loan modification
because of insufficient income.
       The alleged misrepresentations are pleaded with specificity. In each case, the
representation is clearly stated along with why the Akinshins believe it to be a
misrepresentation; the identities of the speakers are provided, along with their roles as
employees of BANA; the person to whom the representations were made is identified;
and the dates of the representations are provided.
       In sustaining BANA’s demurrer, the trial court stated: “[T]he allegations remain
insufficient to show that the February 18, 2010 representation by [Gail]—that plaintiffs
‘qualified for a loan modification so long as plaintiffs made timely payments throughout
the Trial Period’ [citation]—had the same meaning that “if [plaintiffs] made their
payments on time during this Trial Period, BAC would grant a permanent modification’
[citation]. . . . The SAC sets . . . forth [further] representations by [Gail] and [Jacob] as
consistent representations—but the only way to reconcile them is to view Gail’s use of
the word ‘qualified’ to mean some type of eligibility, not final approval.”
       At oral argument on appeal, the Akinshins’ counsel criticized the trial court for
giving the word “qualify” a fixed meaning when the word can have multiple meanings.
He quoted Justice Traynor: “The exclusion of testimony that might contradict the
linguistic background of the judge reflects a judicial belief in the possibility of perfect
verbal expression. [Citation.] This belief is a remnant of a primitive faith in the inherent
potency and inherent meaning of words.” (Pacific Gas & Elec. Co. v. G. W. Thomas

                                               8
Drayage & Rigging Co. (1968) 69 Cal.2d 33, 37, fns. omitted.) We find this quotation
apt, because in focusing on “qualify” as denoting eligibility and not final approval, the
trial court rejected other reasonable interpretations of the alleged representations, in
violation of the principle that demurrer is not the procedure for determining which
inferences should be drawn when competing inferences are possible.
       Here, another possible meaning of Gail’s representation that the Akinshins
“qualified for a loan modification so long as [the Akinshins] made timely payments
throughout the Trial Period” is the meaning that the Akinshins ascribed—that making
timely payments throughout the trial period was all that was necessary to be offered a
permanent loan modification. We disagree with the trial court that the other
representations necessarily contradict that meaning. On March 10, 2010, Jacob told the
Akinshins’ agent that the loan modification was being “considered,” but this was still
during the trial period, so the Akinshins’ ability to satisfy the condition of making timely
payments during that period was still in question. On May 14, 2010, Gail told the
Akinshins’ agent that they “qualified for a loan modification [and] would receive the
necessary paperwork”—a representation that reinforces the Akinshins’ understanding.
That they were also separately asked, on the same day, to provide additional financial
documentation does not necessarily call that understanding into doubt because the
content of the documentation is not specified. BANA may simply have requested up-to-
date bank and credit statements that would not have affected the Akinshins’ qualification
for a loan modification unless they materially differed from earlier statements already
provided to BANA.
       We note that whatever was said by the BANA representatives was communicated
to Daly, not the Akinshins, and that we do not know what was actually said. However, as
already noted, on demurrer we are bound to accept plaintiffs’ allegations as facts. We
conclude that the Akinshins sufficiently pleaded the element of misrepresentation.
       The trial court also held that the Akinshins did not adequately plead justifiable
reliance or damages. We disagree because the SAC alleges that the Akinshins “held off
making alternative arrangements with regard to their loan and their living situation” and

                                              9
“passed up opportunities to declare bankruptcy.” “Forbearance—the decision not to
exercise a right or power—is sufficient . . . to fulfill the element of reliance necessary to
sustain a cause of action for fraud or negligent misrepresentation.” (Small v. Fritz
Companies, Inc. (2003) 30 Cal.4th 167, 174.) We may infer the element of damages
from the alleged forbearance7—that the Akinshins, paid money to BANA during the trial
period that they would not otherwise have paid had they made “alternative arrangements”
or declared bankruptcy.
       BANA contends that the Akinshins were already contractually bound by their
mortgage to make (even larger) payments to BANA during the trial period and rely on
Auerbach v. Great Western Bank (1999) 74 Cal.App.4th 1172, 1185 (Auerbach):
“Respondents’ theory of recovery is based on the premise that a party duped into
performing an existing contractual obligation has suffered damage. More specifically,
they believe a borrower’s reliance on a lender’s fraudulent promise to engage in good
faith negotiations to modify a loan, which causes the borrower to continue to make
payments on a note secured by a seriously undervalued property, supports the reliance
damages necessary to a fraud claim. [¶] Generally speaking, a commitment to perform a
preexisting contractual obligation has no value. In contractual parlance, for example,
doing or promising to do something one is already legally bound to do cannot constitute
the consideration needed to support a binding contract. [Citations.] [¶] The same
understanding has carried over to the tort area.”
       The defendants in Auerbach were not in default on their loan, nor does the opinion
indicate that they even considered bankruptcy proceedings. (Auerbach, supra, 74
Cal.App.4th at p. 1179.) Because possible bankruptcy proceedings are alleged here, we
find Aceves v. U.S. Bank (2011) 192 Cal.App.4th 218 (Aceves) more relevant to our
analysis. In Aceves, the borrower was in arrears on a residential home loan and filed for
bankruptcy. (Id. at p. 221.) “Plaintiff contacted the bank, which promised to work with

       7
        The damages we infer here are explicitly stated in the cause of action for
promissory estoppel.

                                              10
her on a loan reinstatement and modification if she would forgo further bankruptcy
proceedings. In reliance on that promise, plaintiff did not convert her bankruptcy case to
a chapter 13 proceeding or oppose the bank’s motion to lift the bankruptcy stay.” (Ibid.)
After the bankruptcy court lifted the stay, the bank foreclosed on the property instead of
working with the plaintiff to reinstate and modify the loan. (Ibid.) The trial court
dismissed the case on demurrer, but the Aceves court reversed, holding that the complaint
demonstrated detrimental reliance. (Id. at pp. 221-222.)
       While it is true that the Akinshins had a contractual obligation to make payments
to BANA, they were already in default on their loan. We infer from their complaint that
they considered bankruptcy, an option they did not pursue because of BANA’s
representations that they qualified for a loan modification. In light of these
representations, they resumed making (reduced) payments to BANA—payments they
would not have made absent BANA’s representations. Considering the totality of the
alleged circumstances and the example of Aceves, we are unable to determine at the
demurrer stage that general principles, as a matter of law, preclude the Akinshins from
alleging reliance and damages related to their payments to BANA. A trier of fact might
conclude, after both sides have presented their evidence, that the Akinshins suffered no
cognizable damage, but that is not a matter for determination at demurrer.
II. Promissory Estoppel
       “Promissory estoppel is ‘a doctrine which employs equitable principles to satisfy
the requirement that consideration must be given in exchange for the promise sought to
be enforced.’ ” (Kajima/Ray Wilson v. Los Angeles County Metropolitan Transportation
Authority (2000) 23 Cal.4th 305, 310.) “The elements of a promissory estoppel claim are
‘(1) a promise clear and unambiguous in its terms; (2) reliance by the party to whom the
promise is made; (3) [the] reliance must be both reasonable and foreseeable; and (4) the
party asserting the estoppel must be injured by his reliance.’ ” (US Ecology, Inc. v. State
of California (2005) 129 Cal.App.4th 887, 901.) “The party claiming [promissory]
estoppel must specifically plead all facts relied on to establish its elements.” (Smith v.
City and County of San Francisco (1990) 225 Cal.App.3d 38, 48.)

                                             11
       In sustaining the demurrer to the cause of action for promissory estoppel, the trial
court stated: “The court’s prior order observed that plaintiffs had not alleged a ‘promise
clear and unambiguous in its terms’ or injury resulting from their reasonable and
foreseeable reliance. As explained above [referring to the discussion sustaining the
demurrer to the cause of action for fraud], the alleged promise continues to be unclear
and ambiguous.”
       As we discussed in relation to the cause of action for fraud, BANA’s
representations can be understood with the meaning that the Akinshins attribute to them.
Although the trial court understood those representations, considered together, in another
way, the February 2010 representation that the Akinshins were qualified for a
modification if they made timely payments during the trial period is sufficiently clear and
unambiguous for pleading purposes. Whatever the meaning of the word “qualify,” the
Akinshins relied on the representations and made timely payments during the trial period,
only to be told in December 2010 that they did not have sufficient income for a loan
modification.
       “To be enforceable, a promise need only be ‘ “definite enough that a court can
determine the scope of the duty[,] and the limits of performance must be sufficiently
defined to provide a rational basis for the assessment of damages.’ ” (Aceves, supra, 192
Cal.App.4th at p. 226.) Here, the duty on the part of the Akinshins is definite—to make
timely payments during the trial period (initially 90 days and then extended to the end of
the year). If the Akinshins performed their duty, they were “qualified” for a loan
modification—implying a duty on the part of the bank to offer the Akinshins a loan
modification unless the bank learned new facts that would affect their “qualification.”
Here the bank ultimately told the Akinshins that they had insufficient income, but this
was not a new fact because the Akinshins alleged that the bank was at all times aware of
their income. Accordingly, we conclude that the Akinshins have pleaded an enforceable
promise.
       The Akinshins alleged that they relied on BANA’s promise by making payments
during the trial period. There is no doubt that such reliance was foreseeable because it

                                            12
was an explicit condition on the promise. The trial court held that “it was not reasonable
for plaintiffs to rely on a mere oral promise,” but we disagree. Whether reliance was
reasonable is a disputed question of fact that is not appropriately decided on demurrer—
otherwise, it is hard to see how an oral promise could ever survive demurrer.
        The Akinshins alleged that they were injured “in that [they] made the modified
payments and never received a permanent modification” and were damaged “in that they
will lose their home and will unlikely be able to purchase a new home.” We concluded in
discussing the cause of action for fraud that making payments during the trial period is a
sufficient allegation of damage to survive demurrer.
        We conclude that the Akinshins complaint alleged facts sufficient to state a claim
for promissory estoppel.
III. Negligence
        “The complaint in an action for damages for negligent injury to person or property
must allege (a) the defendant’s legal duty of care toward the plaintiff [citation]; (b) the
defendant’s breach of duty—the negligent act or omission [citation]; (c) injury to the
plaintiff as a result of the breach—proximate or legal cause [citation]; and (d) damage to
the plaintiff [citation].” (4 Witkin, Cal. Procedure (5th ed. 2008) Pleading, § 576, p.
701.)
        The Akinshins alleged that BANA “acted negligently, in failing to provide
plaintiffs with accurate information regarding the status of their loan modification when it
was in a position to do so.” In sustaining BANA’s demurrer to the cause of action for
negligence, the court stated: “Plaintiffs’ pleading still does not specify BANA’s alleged
duty or the particular ‘conduct’ by BANA which was negligent and caused plaintiffs’
harm . . . .” We disagree. Construing the complaint liberally and reading it as a whole,
we construe the cause of action for negligence as one for negligent misrepresentation,
providing an alternate legal theory to fraud (intentional misrepresentation) and
promissory estoppel. Under this construction, BANA’s duty not to negligently make
misrepresentations is clearly implied and the misrepresentations are explicitly alleged.

                                              13
       BANA relies on the general rule that “a financial institution owes no duty of care
to a borrower when the institution’s involvement in the loan transaction does not exceed
the scope of its conventional role as a mere lender of money.” (Nymark v. Heart Fed.
Savings & Loan Assn. (1991) 231 Cal.App.3d 1089, 1096.) “Such ‘general rule’ has
often been repeated, including in . . . cases decided in the context of loan modification
applications.” (Jolley v. Chase Home Finance, LLC (2013) 213 Cal.App.4th 872, 898,
fn. omitted.) However, “[e]ven when the lender is acting as a conventional lender, the
no-duty rule is only a general rule. [Citation.] As a recent federal case put it: ‘Nymark
does not support the sweeping conclusion that a lender never owes a duty of care to a
borrower. Rather, the Nymark court explained that the question of whether a lender owes
such a duty requires “the balancing of [the ‘Biakanja factors’] . . . .” ’ ”8 (Jolley, at
pp. 901-902, quoting Newson v. Countrywide Home Loans, Inc. (N.D. Cal. Nov. 30,
2010, No. C 09-5288) 2010 WL 4939795, at p. *5.)
       A bank does have a duty, even when acting within its conventional role as a lender
of money, “to not make material misrepresentations about the status of an application for
a loan modification . . . . It is foreseeable that a borrower might be harmed by an
inaccurate or untimely communication . . . about the status of a loan modification
application, and the connection between the misrepresentation and the injury suffered
could be very close.” (Lueras v. BAC Home Loans Servicing, LP (2013) 221 Cal.App.4th
49, 68-69.) We have already dealt with the elements of injury and damage in considering
the causes of action for fraud and promissory estoppel. Accordingly, the SAC
sufficiently states a cause of action for negligent misrepresentation.

       8
          The Biakanja factors are six nonexhaustive factors: (1) the extent to which the
transaction was intended to affect the plaintiff, (2) the foreseeability of harm to the
plaintiff, (3) the degree of certainty that the plaintiff suffered injury, (4) the closeness of
the connection between the defendant’s conduct and the injury suffered, (5) the moral
blame attached to the defendant’s conduct, and (6) the policy of preventing future harm.
(Biakanja v. Irving (1958) 49 Cal.2d 647, 650.)

                                               14
IV. Unfair Competition
       The UCL “prohibits, and provides civil remedies for, unfair competition, which it
defines as ‘any unlawful, unfair or fraudulent business act or practice.’ ([Bus. & Prof.
Code,] § 17200.) Its purpose ‘is to protect both consumers and competitors by promoting
fair competition in commercial markets for goods and services.’ [Citations.] In service
of that purpose, the Legislature framed the UCL’s substantive provisions in ‘ “broad,
sweeping language” ’ [citations].” (Kwikset Corp. v. Superior Court (2011) 51 Cal.4th
310, 320.) “[A]n individual may not prosecute a UCL claim unless the individual ‘has
suffered injury in fact and has lost money or property as a result of the unfair
competition.’ ([Bus. & Prof. Code,] § 17204.)” (Schwartz v. Provident Life and Accident
Ins. Co. (2013) 216 Cal.App.4th 607, 611.)
       In sustaining BANA’s demurrer to the cause of action for violation of the UCL,
the trial court stated: “[T]he cause of action depends on prior allegations, which are
deficient as stated above.” Because we have determined that the Akinshins’ complaint
sufficiently states causes of action for fraud and negligent misrepresentation, we conclude
that the alleged misrepresentations by BANA are also sufficient to maintain a cause of
action under the UCL. Construing the complaint liberally, the modified loan payments
alleged in the preceding causes of action constitute injury in fact and lost money.
V. The 2007 Loan Origination
       In their opposition to BANA’s demurrer, the Akinshins argued that the cause of
action for fraud was meant to incorporate the earlier allegations concerning the 2007 loan
origination, despite the fact that under that cause of action the SAC listed only alleged
misrepresentations concerning their efforts to obtain a loan modification in 2010.
However, at oral argument on appeal, the Akinshins’ counsel conceded that allegations
concerning the 2007 loan origination relate only to the cause of action for violation of the
UCL.
       Actions for relief on the ground of unfair competition are subject to a four-year
statute of limitations. (Bus. & Prof. Code, §§ 17208, 17200.) The Akinshins received

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their loan on March 18, 2007, but they did not file a complaint until June 24, 2011. The
Akinshins argue that the “discovery rule”9 should apply to toll the statute of limitations.
       Because we have determined that all four of the Akinshins’ causes of action
survive demurrer based on allegations concerning their efforts to obtain a loan
modification in 2010, we have no cause to further consider whether any claims related to
the 2007 loan origination will be time-barred as this matter proceeds.

       9
          “Generally speaking, a cause of action accrues at ‘the time when the cause of
action is complete with all of its elements.’ [Citations.] An important exception to the
general rule of accrual is the ‘discovery rule,’ which postpones accrual of a cause of
action until the plaintiff discovers, or has reason to discover, the cause of action.
[Citations.] [¶] A plaintiff has reason to discover a cause of action when he or she ‘has
reason at least to suspect a factual basis for its elements.’ [Citations.] Under the
discovery rule, suspicion of one or more of the elements of a cause of action, coupled
with knowledge of any remaining elements, will generally trigger the statute of
limitations period. [Citations.]” (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th
797, 806-807 (Fox).)

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                                     DISPOSITION
      The judgment is reversed, and the matter is remanded with directions to the trial
court to vacate its order sustaining the demurrer to the SAC and to enter a new order
overruling the demurrer. The Akinshins are awarded their costs on appeal.

                                                 _________________________
                                                 Brick, J.*

We concur:

_________________________
Kline, P.J.

_________________________
Richman, J.

      * Judge of the Alameda County Superior Court, assigned by the Chief Justice
pursuant to article VI, section 6 of the California Constitution.

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