Court Opinion

ID: 4572481
Source: CourtListenerOpinion
Date Created: 2020-10-02 19:02:43.472794+00
Date Added: 2024-06-11T13:29:35.595847
License: Public Domain

Filed 10/2/20 Forde v. Entous CA2/2
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                         SECOND APPELLATE DISTRICT

                                        DIVISION TWO

 STEPHEN FORDE,                                                         B292606

           Plaintiff and Appellant,                                     (Los Angeles County
                                                                        Super. Ct. No. BSC570050)
           v.

 ALLAN ENTOUS et al.,

           Defendants and Respondents.

     APPEAL from a judgment of the Superior Court of Los
Angeles County. Michael P. Vicencia, Judge. Reversed and
remanded with directions.
     Henry J. Josefsberg for Plaintiff and Appellant.
     Berokim & Duel and Kousha Berokim for Defendants and
Respondents.
              _________________________________
       Stephen Forde appeals from a judgment against him on his
claims against Allan Entous and related entities arising from
Entous’s alleged wrongful foreclosure on three properties that
Forde owned.1 Forde alleged that the loans the three properties
secured were usurious and he therefore was not obligated to pay
any interest on them. He claimed that Entous’s nonjudicial
foreclosure on the properties was wrongful because, without any
requirement to pay interest, Forde was current on his loans.
      During a trial to the court on Forde’s equitable claims, the
court granted a defense motion for judgment on the ground that,
even assuming the loans were usurious, Forde had no wrongful
foreclosure claim because he failed to tender the amount due on
the secured loans. The parties then reached a settlement and
Forde dismissed his remaining claims for damages to facilitate
this appeal.
      Although the procedural history of the case is complicated
and the parties argue a number of issues on appeal, the
dispositive issue is straightforward. The trial court mistakenly
concluded that Forde was required to tender the entire amount of
the outstanding principal on the allegedly usurious loans to
maintain a claim for wrongful foreclosure. That conclusion is
inconsistent with the law on usury and wrongful foreclosure.
      The evidence suggests that, at least for two of the loans,
Forde was not in default on the payment of principal at the time

      1As identified in the judgment, the prevailing parties were
Allan Entous, Allan Entous as trustee of the Entous Revocable
Trust Dated June 8, 1984, and The Allan Entous 401(k) P/S Plan.
We refer to them collectively as Entous.

                                2
that Entous began foreclosure proceedings. Thus, the trial
court’s error was prejudicial.
      Forde originally asserted 10 causes of action. The trial
court decided five of those causes of action, including wrongful
foreclosure. Forde voluntarily dismissed the rest.
      Of the five claims that the trial court decided, Forde makes
an argument for reversal on only one—wrongful foreclosure. We
therefore will reverse the judgment and remand for trial on
Forde’s legal claim for damages for wrongful foreclosure.2
                         BACKGROUND
1.    The Loans
      Forde received a series of loans from Entous from 2011 to
2014. Three of those loans were secured by properties that are at
issue in this appeal.
      Following nonjudicial foreclosure proceedings after Forde’s
alleged default, Entous purchased each of the properties at a
trustee’s sale on June 12, 2015.
      a.     310 North Jackson Street
      This property (310 Jackson) is a condominium unit in
Glendale. It secured a loan for $204,000 that Forde received from
Entous in July 2013.
      The loan was documented by a note that specified an
interest rate of 10 percent. The note required monthly interest

      2As discussed further below, pursuant to the settlement
Forde dismissed several of his remaining claims (for alleged
usury and breach of the covenant of good faith and fair dealing)
without prejudice with respect to two of the foreclosed properties.
Because those claims were dismissed, we do not consider them.
We leave to the trial court to decide any motion that Forde might
make on remand to amend his complaint to revive those claims.

                                 3
payments “until the 7th day of August, 2015, at which time the
entire principal balance, together with interest due thereon, shall
become due and payable.”
       Entous issued a notice of default on the loan on January 16,
2015, seven months before the principal was due, claiming a
deficiency of $8,128.67.
       b.    306 North Jackson Street
       This property (306 Jackson) secured a note for $180,000
dated December 26, 2013. The note was “an optional advance
note,” with a first advance for $114,000. The note stated that
“individual advances made pursuant to this note may contain
different terms and due dates.” The note specified an interest
rate of 10 percent “payable monthly at interest only or more.”
Unless otherwise stated “in any future advance,” the due date of
the note was December 31, 2014.
       Entous issued a notice of default on the loan on January 16,
2015, claiming a deficiency of $136,649.53.
       c.    1129 North Verdugo Road
       This property (1129 Verdugo) secured a note for $240,000
dated March 19, 2014. The note was also an “optional advance
note,” with an initial advance of $60,000.3 The note specified
10 percent interest “payable monthly at interest only or more.”
Unless otherwise indicated in any future advance, the due date of
the note was March 31, 2015.

      3 Forde explained at trial that this note combined two
previous loans, including a loan for $30,000 he originally received
on July 25, 2013, and another $30,000 loan that he had received
earlier that year.

                                 4
        Entous issued a notice of default on the loan on January 16,
2015, more than two months before the principal was due,
claiming a deficiency of $2,210.74.
2.      Proceedings in the Trial Court
        a.    Forde’s allegations
        Forde’s operative second amended complaint (Complaint)
alleged causes of action for: (1) wrongful foreclosure; (2) setting
aside the trustee’s sales; (3) cancelation of instruments; (4) quiet
title; (5) slander of title; (6) negligence;4 (7) breach of the
covenant of good faith and fair dealing; (8) “possession of personal
property and damages”; (9) usury; and (10) unlawful, unfair, or
fraudulent business practices under Business and Professions
Code section 17200 et seq.
        Forde alleged that, despite the stated interest rates on the
notes for the loans, Entous actually required usurious rates of
interest. Forde claimed that, because no interest may be claimed
on a usurious loan, “Forde actually had a credit balance
applicable to each loan when the Entous Defendants fabricated
the sudden defaults.” Forde sought to set aside the foreclosure
sales and also claimed compensatory and punitive damages.
        Entous filed a separate action against Forde on
February 24, 2017, for unlawful detainer (the UD Action).
Entous claimed that Forde wrongfully remained in possession of
310 Jackson following the trustee’s sale.

      4 The negligence claim was alleged only against a former
defendant, RESS Financial Corporation, and was dismissed
before trial.

                                 5
        b.    The bench trial
        The trial court bifurcated trial into three phases. The first
phase was a trial to the court on the equitable claims in Forde’s
first five causes of action. The second phase was a jury trial on
Entous’s UD Action. The third phase was to be a jury trial on
Forde’s claims for damages based upon the allegedly usurious
loans.
        During the bench trial, Forde testified that, in addition to
the stated 10 percent interest rates on the notes secured by the
three foreclosed properties, Entous required him to make
monthly cash payments. Those payments resulted in an interest
rate of more than 10 percent.
        After Forde had presented his case, Entous moved for
judgment. Entous argued that Forde had failed to show that he
had tendered the amounts due on the secured loans. Entous
argued that no exception to the tender requirement applied to the
loans at issue, and that Forde’s failure of proof therefore entitled
him to judgment in his favor.
        The trial court agreed. The court reasoned that, even
assuming that the loans on the secured properties were usurious
and that all of Forde’s interest payments should therefore have
been credited to principal, large amounts of principal remained
due on each of the loans. The court found that “there are no
equitable reasons why tender should not be required.” The court
concluded that “since tender has not been made . . . then
wrongful foreclosure is not available as to any of those three
properties.”
        c.    Settlement and judgment
        After the bench trial, the court conducted a jury trial on
Entous’s UD Action, at which Entous prevailed.

                                 6
       Following that trial, the court informed the parties that the
jury trial on Forde’s usury claims would proceed on the following
Monday. The parties reached a settlement before that trial
began.
       The settlement agreement provided for a payment by Forde
to Entous in return for Entous’s reconveyance of 310 Jackson. As
part of that agreement, Forde waived “his rights and claims as to
310 Jackson Street . . . and Loan for $204,000, including
usury/wrongful foreclosure/claims stated in his second amended
complaint.”
       Forde also agreed that he would dismiss his sixth, eighth
and tenth causes of action with prejudice. He further agreed that
he would waive, and not pursue, claims in his seventh and ninth
causes of action, “except for loans associated with 1129 Verdugo
and 306 Jackson.”
       The settlement agreement stated that “Forde intends to,
and shall only appeal, the Court ruling and anticipated judgment
on 1st, 2nd, 3rd, 4th and 5th causes of action . . . as to 1129
Verdugo and 306 Jackson. If upon appeal the trial court’s
ruling/judgment is affirmed, then Forde’s remaining claims . . . ,
including usury claims (9th cause of action) as to 1129 Verdugo
and 306 Jackson shall be dismissed with prejudice within 15 days
of the trial court’s receipt of the remittitur.”
       The trial court entered judgment in favor of Entous on
Forde’s first five causes of action. Pursuant to the settlement
agreement, Forde then filed a request for dismissal of his
remaining causes of action.
       Forde requested dismissal of his eighth and tenth causes of
action with prejudice. Forde also requested dismissal with
prejudice of his seventh cause of action (for breach of the

                                 7
covenant of good faith and fair dealing) and ninth cause of action
(for usury) “as to all loans except those loans associated with 306
North Jackson, and 1129 North Verdugo.” For the excepted
claims, he requested dismissal without prejudice. The trial court
granted the request, thus completely resolving the claims in
Forde’s Complaint.
        Following a motion by Entous for contractual attorney fees,
the trial court entered an amended judgment awarding Entous
fees in the amount of $157,470.5
                            DISCUSSION
1.      Appealability
        The parties’ settlement during the bifurcated trial raises
several questions about the appealability of the resulting
Judgment.
        a.    Finality
        As mentioned, the Judgment itself only disposed of Forde’s
first five causes of action. Pursuant to the settlement, Forde
subsequently dismissed his remaining causes of action, but
without prejudice as to several. The possibility of future
proceedings on those causes of action raises a question about the
finality of the Judgment.
        A judgment that “fails to dispose of all the causes of action
pending between the parties is generally not appealable.”
(Kurwa v. Kislinger (2013) 57 Cal.4th 1097, 1100 (Kurwa), citing
Code Civ. Proc., § 904.1, subd. (a).) Parties to litigation cannot
create an appealable final judgment by temporarily dismissing

      5 Forde appealed from both the initial judgment and the
amended judgment containing the attorney fee award. We refer
to both judgments in the singular as the “Judgment.”

                                  8
claims pending appeal with the understanding that they will
later be revived for resolution: “When . . . the trial court has
resolved some causes of action and the others are voluntarily
dismissed, but the parties have agreed to preserve the voluntarily
dismissed counts for potential litigation upon conclusion of the
appeal from the judgment rendered, the judgment is one that
‘fails to complete the disposition of all the causes of action
between the parties’ [citation] and is therefore not appealable.”
(Kurwa, at p. 1105, quoting Morehart v. County of Santa Barbara
(1994) 7 Cal.4th 725, 743.) Thus, “where the parties, by waiver
or agreed tolling of the statute of limitations or a similar
agreement, have arranged for [dismissed] causes of action to be
resurrected upon completion of the appeal, they remain ‘legally
alive’ in substance and effect.” (Kurwa, supra, 57 Cal.4th at
p. 1105, quoting Hill v. City of Clovis (1998) 63 Cal.App.4th 434,
445 (Hill).)
        However, a plaintiff’s dismissal of his or her claims without
prejudice can create a final, appealable judgment if the dismissal
is “unaccompanied by any agreement for future litigation.”
(Kurwa, supra, 57 Cal.4th at p. 1105.) A voluntary dismissal
without an agreement to toll or waive applicable statutes of
limitation includes “ ‘the very real risk that an applicable statute
of limitations will run before the party is in a position to renew
the dismissed cause of action.’ ” (Id. at pp. 1105–1106, quoting
Hill, supra, 63 Cal.App.4th at p. 445.) It is the assurance of
future viability provided by a tolling or waiver agreement that
“prevents the judgment disposing of the other causes of action
from achieving finality.” (Kurwa, at p. 1106.)
        The parties’ settlement agreement here does not contain
any provision that applicable statutes of limitation will be waived

                                 9
or tolled pending the appeal. Thus, under the rule established in
Kurwa, the judgment is final for purposes of appeal even though
several of Forde’s causes of action were dismissed without
prejudice.6
       b.    Mootness
       The settlement also raises the question whether the appeal
is moot.7 Entous apparently has already sold 306 Jackson and
1129 Verdugo to bona fide purchasers. At trial, Forde agreed
that equitable relief was therefore not available for those
properties. The settlement then resolved all of Forde’s claims
with respect to 310 Jackson.
       The bench trial leading to the Judgment involved only the
equitable claims in Forde’s first five causes of action. Entous
suggests that Forde sought equitable relief only in those causes of
action. If so, the settlement completely disposed of Forde’s
wrongful foreclosure cause of action by resolving Forde’s only
remaining equitable claim concerning 310 Jackson.
       In contrast, Forde claims that the trial court’s ruling also
resolved his legal claims for damages, including a claim for
damages on his wrongful foreclosure cause of action. Forde

      6  Forde’s claim that he did not dismiss his usury cause of
action is wrong. As discussed, his request for dismissal included
that cause of action, albeit without prejudice with respect to the
loans secured by 306 Jackson and 1129 Verdugo. Had he not
dismissed his usury claim, the Judgment would not have been
final for purposes of appeal.
      7 Because the parties’ briefs did not discuss this issue, we
issued a letter pursuant to Government Code section 68081
inviting the parties to address it. In his letter brief, Entous
argues that the appeal is moot.

                                 10
argues that the trial court’s ruling following the bench trial not
only resolved the equitable claims in his first five causes of
action, but also made factual findings that made a further jury
trial unnecessary. (See Rincon EV Realty LLC v. CP III Rincon
Towers, Inc. (2019) 43 Cal.App.5th 988, 993 [when a case involves
both legal and equitable claims, the trial court may first decide
the equitable issues, which may result in findings that dispose of
the legal claims].)8
       In support, Forde cites his colloquy with the trial court
following the bench trial. Forde requested that the trial court
“reserve judgment on the wrongful foreclosure issues until after
hearing the usury case.” The court responded, “I don’t need to
because even assuming usury is true, he [(Forde)] hasn’t
tendered.”
       In its ruling, the trial court did not explicitly state that it
intended to resolve any remaining legal claims. Indeed, some of
the court’s comments suggest that the court believed only
equitable claims were at issue in Forde’s wrongful foreclosure

      8 Forde confuses the issue by arguing in his opening brief
that the trial court’s ruling made a jury trial unnecessary on his
usury claim. The trial court did not make such a finding. As
discussed, the trial court’s ruling following the bench trial
resolved only Forde’s first five causes of action, and did not
address Forde’s ninth cause of action for usury. In fact, the trial
court was about to proceed to a jury trial on Forde’s usury claim
when Forde agreed to the settlement that involved dismissal of
that claim.

                                 11
cause of action.9 Thus, it is far from clear that the trial court
intended its ruling to resolve any remaining claim for damages
for wrongful foreclosure.
       Nevertheless, it appears that the effect of the trial court’s
ruling was to dispose of a legal claim for damages for wrongful
foreclosure. Wrongful foreclosure is a tort that may be remedied
with damages as well as equitable relief. (Miles v. Deutsche Bank
National Trust Co. (2015) 236 Cal.App.4th 394, 408 [“ ‘[A] trustee
or mortgagee may be liable to the trustor or mortgagor for
damages sustained where there has been an illegal, fraudulent or
wil[l]fully oppressive sale of property under a power of sale
contained in a mortgage or deed of trust’ ”], quoting Munger v.
Moore (1970) 11 Cal.App.3d 1, 7.) In his first cause of action for
wrongful foreclosure, Forde sought “general and special damages”
and punitive damages as well as equitable relief. Forde’s trial
brief also explained that he sought “all proximately caused
damages” on his wrongful foreclosure claim.
       Entous does not cite anything in the record showing that
Forde abandoned this legal claim. Thus, it appears that the trial
court’s ruling resolved Forde’s claim for damages for wrongful
foreclosure as well as his equitable claim seeking to recover the
properties.
       Resolution of Forde’s equitable claims through the
settlement therefore did not moot this appeal. Forde’s legal claim
for damages for wrongful foreclosure remains at issue.

      9 For example, in discussing the next phase of trial, the
court explained that if Forde were able to prove usury, he “might
be able to get damages” from the jury but “[y]ou just don’t get
wrongful foreclosure. You are talking about getting the
property.”

                                12
       Moreover, the trial court awarded Entous attorney fees as
the prevailing party. If the trial court’s ruling on the merits was
erroneous, the basis for the attorney fee award disappears. (See
Viejo Bancorp, Inc. v. Wood (1989) 217 Cal.App.3d 200, 205–206
[concluding that the appeal was not moot in part because such a
ruling would “leave unanswered the propriety of the award of
$22,000 in attorney’s fees”].)
       We therefore proceed to consider the merits of Forde’s
appeal.
2.     Forde Was Not Required to Prove that He
       Tendered the Full Amount of Outstanding
       Principal on the Allegedly Usurious Loans
       The trial court’s ruling granting Entous’s motion for
judgment was based on the premise that Forde was required to
tender the entire outstanding principal balance on his loans to
maintain an action for wrongful foreclosure. Because this is an
issue of law, we review it de novo. (People ex rel. Lockyer v.
Shamrock Foods Co. (2000) 24 Cal.4th 415, 432.)
       The trial court’s understanding that Forde was required to
tender the entire outstanding principal is clear from the court’s
ruling. The court explained that even if one were to assume that
all three loans were usurious and credit all Forde’s payments to
principal as the usury laws require, “[t]here are still large
amounts due on each of the properties.” The court calculated
that Forde still owed $172,342 on 310 Jackson, “just under”
$100,000 on 306 Jackson, and $47,200 on 1129 Verdugo. The
court concluded that “[s]ince none of that was tendered, wrongful
foreclosure is not available.”
       The trial court found that Forde was required to tender the
full amounts of the outstanding principal even if Forde was not in

                                13
default on principal payments. That finding is apparent from the
argument on Entous’s motion for judgment.10
       After the trial court had announced its tentative ruling,
Forde argued that, if the loans were usurious, all of Forde’s
payments should be credited to principal. The trial court agreed,
but stated, “That was the calculation I just gave you. Assuming
all the payments Mr. Forde says he made were applied only to
principal, those amounts [of principal] were still due, and
foreclosure was proper because he didn’t tender those amounts.”
Forde then argued that if his payments were credited to
principal, “he would, in fact, have a credit balance on the loan
and he would be paid well ahead.” The court responded “but take
advantage of the usury statutes, that does not forgive your
obligation to pay the principal. . . It is your obligation to say that
because you were charging me usury amounts, not only do I get
to take all of those amounts that I paid in quote, unquote
‘interest’ and apply it all to principal, but I get to continue to pay
over time interest-free. That’s not available anywhere.” In
response to Forde’s further argument that the notices of default
were defective if he had actually paid more than he was required
to pay, the court responded, “Right. That may very well be true.
But in order to get wrongful foreclosure, you have to pay. That is
your first hurdle, and that didn’t happen.”

      10 It is also apparent from the evidence. As summarized
above and discussed further below, the notes required monthly
payments of interest only. No principal was yet due on at least
two of those notes at the time Entous issued the notices of
default.

                                 14
      The trial court’s ruling was inconsistent with the law on
usury. Civil Code section 1916-2 addresses usurious loans.11
The last sentence of that section states that “[a]ny agreement or
contract of any nature in conflict with the provisions of this
section shall be null and void as to any agreement or stipulation
therein contained to pay interest and no action at law to recover
interest in any sum shall be maintained and the debt cannot be
declared due until the full period of time it was contracted for has
elapsed.” (§ 1916-2, italics added.)12
      Our Supreme Court long ago interpreted that provision to
mean that the due date of a usurious loan may not be accelerated
due to a failure to pay interest. In Haines v. Commercial Mortg.
Co. (1927) 200 Cal. 609 the court explained that “careful
consideration of [section 1916-2] convinces us that the intent is
that the maturity date of the obligation cannot be accelerated, if

      11Subsequent undesignated statutory references are to the
Civil Code.
      12 This provision actually was a portion of an uncodified
voter initiative enacted in 1918. (See Wishnev v. The
Northwestern Mutual Life Ins. Co. (2019) 8 Cal.5th 199, 207, fn. 7
(Wishnev).) Following the lead of our Supreme Court, we refer to
the provision by using West’s designation of the uncodified
initiative as section 1916-2 of the Civil Code. (Ibid.)
       Although section 1916-2 limits interest rates to 12 percent,
a later enacted constitutional amendment (now contained in
section 1 of article XV) changed the legal limit to 10 percent, with
exceptions for various financial institutions. (Cal. Const., art.
XV, §1; Wishnev, supra, 8 Cal.5th at pp. 208–209.) The
constitutional amendment did not affect other provisions in
section 1916-2 that were not inconsistent with the amendment.
(Wishnev, at p. 211.)

                                 15
the option to declare the whole of the principal debt due is
dependent solely upon nonpayment of usurious interest. In other
words, if the note provides for installment payments on the
principal as well as the payment of interest and gives the right to
the holder to declare the whole debt due for nonpayment of either
principal or interest, the forfeiture of the right as to interest
could not destroy or affect the remaining right as to principal.”
(Id. at pp. 620, 623–625.)
       The court has reaffirmed this principle several times, most
recently in Wishnev. (See Verbeck v. Clymer (1927) 202 Cal. 557,
562 [“It is now well settled that in a case where the usury is
established, the obligation to pay interest is void and the
maturity date of the principal cannot be accelerated on account of
the nonpayment of interest”]; Wishnev, supra, 8 Cal.5th at
p. 207.) In Wishnev, the court explained that, under the 1918
initiative, a lender who charges usurious interest “forfeits the
right to collect any interest. (§ 1916-2.) Further, the principal
debt is not due until the full term of the loan has expired. (Ibid.)
The effect of these provisions is to confer upon the borrower the
free use of the lender’s money for the duration of the loan period.”
(Wishnev, supra, 8 Cal.5th at p. 207.) Thus, contrary to the trial
court’s ruling, the law does permit the recipient of a usurious
loan to “pay over time interest free.”
       The trial court’s ruling was also inconsistent with the law
governing nonjudicial foreclosures. There is no general
requirement that a trustor who is in default must tender the full
outstanding amount of the secured loan to avoid a nonjudicial
foreclosure. A trustor must do so if he or she seeks to redeem the
property—that is, to reclaim it free and clear of the trust deed.
(Turner v. Seterus, Inc. (2018) 27 Cal.App.5th 516, 527–528

                                16
(Turner).) But if the trustor seeks only to reinstate the existing
loan, he or she need only tender the amounts that are then due.
(Ibid.; § 2924c, subd. (a)(1).) Similarly, a plaintiff who seeks
relief based on the defendant’s alleged wrongful refusal to
reinstate a loan need only have tendered the amount then due on
the loan. (Turner, at p. 528.)
       Of course, if no amount is actually due, the trustor is not
actually in default, and need not tender anything at all. “ ‘The
law does not require plaintiff to tender the purchase price to a
trustee who has no right to sell the property at all.’ ” (Turner,
supra, 27 Cal.App.5th at p. 530, quoting Alvarez v. BAC Home
Loans Servicing, L.P. (2014) 228 Cal.App.4th 941, 951.)
       Consistent with this principle, a trustor who has a
counterclaim or set-off against the beneficiary/lender that
exceeds the amount due on the loan need not tender anything at
all as a prerequisite to a wrongful foreclosure claim. (Turner,
supra, 27 Cal.App.5th at pp. 525–526.) “In such cases, it is
deemed that that tender and the counterclaim offset one another,
and if the offset is equal to or greater than the amount due, a
tender is not required.” (Lona v. Citibank, N.A. (2011) 202
Cal.App.4th 89, 113 (Lona).)
       That is essentially the theory that Forde asserts. Forde
claims that because the loans securing the foreclosed properties
were usurious, all his interest payments must be credited to
principal and he therefore “should have had credit balances.”

                                17
Thus, he contends that he had a claim for usury that would
completely offset the purported default in his loan payments.13
       Forde asserted this theory below. As discussed above, he
argued to the trial court that he had a credit balance on the loans
if his payments were all credited to principal. He also argued
that he was not obligated to tender the entire amount of the
outstanding principal on the loans because such an obligation
would “in effect, accelerate the obligation for the payoff,” and
would “require him to make a balloon payment that he was not
otherwise obligated to make.”
       Forde raised this issue before trial as well. Forde argued in
his trial brief that because no interest was due on the allegedly
usurious loans, he “actually had credit balances on the loans.”
His trial brief cited Lona in arguing the legal principle that
tender is not required when the person who seeks to set aside a
trustee’s sale has a counterclaim or set-off against the
beneficiary. (See Lona, supra, 202 Cal.App.4th at p. 113.) Thus,
Entous’s assertion that Forde did not raise this argument in the
trial court is baseless.
3.     The Trial Court’s Ruling Was Prejudicial
       The record shows that the trial court’s misunderstanding of
the legal rule likely affected the outcome. (Code Civ. Proc.,
§ 475.) At least with respect to two of the three loans, there is
evidence in the record to support Forde’s claim that the loans
were current if he owed no interest.

      13  Indeed, if the notes in fact required payment of interest
only, a finding that the loans were usurious would mean that
Forde owed nothing at all on the loans until the principal was
due.

                                 18
       Forde testified that all three loans were “interest only.”
The loan agreements for each of the loans supports the conclusion
that only interest was due until the principal was to be paid in
full. The agreement for 310 Jackson stated that “[i]nterest is
payable in monthly instalments of Seventeen Hundred dollars
($1,700) or more on the 7th day of each month, beginning on the
7th day of September, 2013, and continuing until the 7th day of
August, 2015, at which time the entire principal balance,
together with interest due thereon, shall become due and
payable.” The agreement for 306 Jackson stated that “[t]he
interest is payable monthly at interest only or more.” The “due
date” of the note was December 31, 2014, “[u]nless otherwise
indicated in any future advance.” The agreement for 1129
Verdugo similarly stated that “[t]he interest is payable monthly
at interest only or more.” The due date of that note was March
31, 2015, “[u]nless otherwise indicated in any future advance.”
       Each of the notices of default on these three loans was
dated January 16, 2015.14 Thus, as of the date Entous began the
process of nonjudicial foreclosure, no principal was yet due on the
loans secured by 310 Jackson and 1129 Verdugo. (See Anderson
v. Heart Fed. Sav. (1989) 208 Cal.App.3d 202, 211 [a beneficiary
of a deed of trust is “ ‘bound by [its] notice of default, . . . [and]
cannot insist upon any grounds of default other than those stated
in that notice’ ”], quoting Tomczak v. Ortega (1966) 240
Cal.App.2d 902, 904.)

      14 Forde only introduced the notice of default for 310
Jackson as an exhibit at trial. However, the other two default
notices were attached to Forde’s verified complaint. The dates of
these notices does not seem to be in dispute.

                                 19
       There is also evidence supporting Forde’s claim that the
loans were usurious. Forde testified that, in addition to the
10 percent interest rate stated in the notes, Entous required
extra cash payments equivalent to an additional 2 to 5 percent
interest on each loan. Forde testified that the additional cash
payments were inaccurately reflected in the loan documentation
that Entous prepared as payments “towards principal.”
       Entous did not dispute that Forde made the extra cash
payments, but testified that Forde did so voluntarily. Entous
claimed that he had “no idea” why Forde decided to make such
extra cash payments.
       Forde also introduced as an exhibit a handwritten
document that he testified Entous prepared. The document
contains a notation of “12%” concerning the note that appears to
apply to 310 Jackson, and a notation of “15%” for the loans
secured by 306 Jackson and 1129 Verdugo.
       Thus, the record contains evidence that would support
findings that: (1) the loans were usurious, and (2) at least two of
the loans were not in default at the time Entous foreclosed. Had
the trial court correctly applied the law, the court could therefore
have found that Entous’s foreclosures were wrongful.
       Because the trial court’s ruling on the tender requirement
was both erroneous and prejudicial, we must reverse.
4.     Proceedings on Remand
       As discussed, the trial court’s ruling and the resulting
Judgment decided only Forde’s first five causes of action. Forde
concedes that three of those causes of action—for quiet title,
cancelation of instruments, and to set aside the trustee sales—
are not at issue in this appeal.

                                 20
       Forde incorrectly states that he dismissed his fifth cause of
action for slander of title pursuant to the settlement agreement.
In fact, that cause of action was included in the Judgment.
However, because Forde does not present any argument for
reversal with respect to that cause of action, he has forfeited the
issue. (Singh v. Lipworth (2005) 132 Cal.App.4th 40, 43, fn. 2.)
       Forde does argue for reversal of the Judgment concerning
his first cause of action for wrongful foreclosure. For the reasons
discussed above, we agree that the Judgment must be reversed
with respect to Forde’s claim for damages on that cause of action.
We therefore will reverse for trial on that legal claim.
       None of Forde’s other causes of action are at issue in this
appeal. Forde appealed from the Judgment. The Judgment
included only Forde’s first five causes of action. Forde voluntarily
dismissed his remaining causes of action—including his usury
claim and his claim for breach of the covenant of good faith and
fair dealing—to facilitate this appeal. Forde’s arguments that he
was not required to tender to maintain his claims for usury and
for breach of the covenant of good faith and fair dealing are
therefore both irrelevant and puzzling.
       Moreover, even if Forde had purported to appeal from his
own voluntary dismissal of his remaining claims, he could not
show prejudice from the trial court’s ruling affecting those claims.
(See Villano v. Waterman Convalescent Hospital, Inc. (2010) 181
Cal.App.4th 1189, 1203–1204 [appellant could not show prejudice
from an in limine ruling after stipulating to a judgment to
facilitate appeal of the ruling].) Nothing in the trial court’s
decision from the first phase of trial precluded Forde from
proceeding with his remaining legal claims for damages. After
ruling on Forde’s equitable claims, the trial court specifically

                                21
stated that Forde could “still get damages from the jury.” Indeed,
trial was about to begin on Forde’s usury claim when the parties
entered into the settlement.
       We will therefore reverse the Judgment, including the trial
court’s award of attorney fees to Entous as the prevailing party,
and remand for trial on Forde’s claim for damages for wrongful
foreclosure.15 We leave for the trial court to decide the
appropriate disposition of any motion by Forde to reassert the
claims that he dismissed without prejudice pursuant to the
settlement.

      15 In addition to reversal of the trial court’s attorney fee
award, Forde asks for an award of “fees” on appeal. Forde offers
no argument in support of that request. Presumably the basis for
such a fee award would be the loan agreements that were the
ground for the trial court’s award of fees to Entous as the
prevailing party. (See Civ. Code, § 1717.) Forde settled his
remaining equitable claim concerning 310 Jackson prior to this
appeal, and, as a result of our decision in this appeal, there is not
yet any prevailing party. We therefore decline the request to
award fees on appeal and leave to the trial court to decide any fee
request on remand following final resolution of Forde’s remaining
claim.

                                 22
                           DISPOSITION
       The Judgment is reversed. The case is remanded to the
trial court for trial on Forde’s claim for damages pursuant to his
first cause of action for wrongful foreclosure. The trial court may
exercise its discretion on remand in considering any motion by
Forde to amend his Complaint to reassert the claims in his
seventh cause of action (for breach of the covenant of good faith
and fair dealing) and his ninth cause of action (for usury)
concerning 306 Jackson and 1129 Verdugo, subject to any
applicable statute of limitations defense. Forde is entitled to his
costs on appeal.
      NOT TO BE PUBLISHED.

                                     LUI, P. J.
We concur:

      ASHMANN-GERST, J.

      HOFFSTADT, J.

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