Court Opinion

ID: 4680618
Source: CourtListenerOpinion
Date Created: 2021-04-23 17:02:58.542582+00
Date Added: 2024-06-11T08:03:56.379231
License: Public Domain

Filed 4/23/21 Carpio v. JP Morgan Chase Bank CA3
                                           NOT TO BE PUBLISHED
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 This opinion has not been certified for publication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
                                      THIRD APPELLATE DISTRICT
                                                     (Sacramento)
                                                            ----

 TOMAS MERCADO CARPIO IV,                                                                      C087825

                    Plaintiff and Appellant,                                              (Super. Ct. No.
                                                                                        34201700215212 )
           v.

 JP MORGAN CHASE BANK, N.A., et al.,

                    Defendants and Respondents.

         Five years after his home was sold in a foreclosure sale, plaintiff Tomas Mercado
Carpio IV sued defendants JP Morgan Chase Bank, N.A. and others for causes of action
including wrongful foreclosure and breach of contract. The trial court sustained, without
leave to amend, defendants’ demurrer to Carpio’s second amended complaint, finding the

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applicable statutes of limitations had run. Carpio now appeals contending the statutes of
limitations was tolled under the delayed discovery rule and equitable tolling.1
       We affirm.
                   FACTUAL AND PROCEDURAL BACKGROUND
                              The Second Amended Complaint
       Carpio’s second amended complaint alleged six causes of action.2 In substance,
he alleged he obtained a mortgage loan in 2005. In late 2011, an assignment of deed of
trust transferred the deed to one of the defendants. The assignment deed was executed,
notarized, and recorded. In early 2012, Carpio’s house was sold in a foreclosure sale.
       Carpio’s allegations take issue with the assignment of deed, contending, through
various allegations, that the assignment of deed was invalid. He also alleged that he
entered into a “standardized contract” with one of the defendants for a “temporary trial
modification” of his mortgage loan. And “[d]espite Plaintiff’s efforts, Defendant . . .
ignored its legal obligation to refrain from the practice of dual tracking while Plaintiff’s
Loan Modification Application was under review.” He wrote that he “sought a loan
modification from Defendant …, only to have [his] home[] wrongfully, oppressively and
illegally sold out from under [his] feet . . . .”
       Carpio also alleged that his causes of action are not time barred because the
statutes of limitations were tolled. He wrote that through equitable tolling, the court
could in the interest of justice toll the statutes of limitations, which would prevent the

1 Carpio also raises several other contentions going to the merits of his allegations.
Because we conclude the trial court properly sustained the demurrer based on the
applicable statutes of limitations, we do not reach Carpio’s other contentions.
2 It alleged (1) wrongful foreclosure, (2) breach of contract, (3) breach of implied
covenant of good faith and fair dealings, (4) unfair or deceptive practices (Bus. & Prof.
Code, § 17200, et. seq.), (5) fraud by deceit, and (6) a violation of civil code section
2934a.

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injustice of “Defendants escaping liability based upon procedural delay in Plaintiff’s
efforts in seeking remedies for Defendants’ fraudulent, wrongful and oppressive
conduct . . . .”
       The complaint also alleged: “Defendants’ fraudulent concealment of material
facts pertaining to the actual beneficial interest in Plaintiff’s subject property directly
caused a delay in discovering the fraudulent acts of Defendants because Plaintiff would
have no other reason to assume that the false assertion as to who the actual beneficiary
was would be falsely stated and because the Defendants were in a superior position of
knowledge and access to evidence that would have exposed Defendants’ false assertions
and put Plaintiff on Notice that the assertions made in said recorded documents were
false. Thus, it is unreasonable to expect a reasonably prudent homeowner to be able to
formulate any other belief other than that the Defendants’ assertions in the documents
were true, particularly since it was Defendants intent to conceal and did, in fact, conceal
the rightful and accurate beneficiary of Plaintiff’s Note and Deed of Trust when
Defendant executed and recorded their fraudulent foreclosure documents.”3
       Carpio went on to explain that: “In early 2017, [he] read various media reports
that identified many homes that were possibly foreclosed upon illegally and involved
various named Defendants in such illegal foreclosures.” He added: “Though
Defendants’ fraudulent actions were, in a technical sense, completed in 2012, when
Defendants illegally foreclosed on Plaintiff’s home, who subsequently illegally and
wrongfully alleged to have been the valid Beneficiary of Plaintiff’s Note and Deed of
Trust, Plaintiff did not discover said fraudulent acts, and Defendants’ attempt to conceal

3  Elsewhere the complaint alleged: “Defendants purposely defrauded Plaintiff and
continued the fraud through their intentional and purposeful concealment of their illegal
conduct. Because Defendants willfully, purposefully and intentionally concealed said
fraud, and in the interest of justice, the statute of limitations are tolled for all of Plaintiff’s
causes of action.”

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said acts, until 2017, when Plaintiff sought assistance in reviewing the mortgage
documents, including all documents recorded in the Sacramento County Recorder’s
Office, that were related to the loan taken out by plaintiff . . . on the Subject Property.
Plaintiff was, thus, unable to discover said fraudulent activity on the part of Defendants
… until 2017, despite Plaintiff’s reasonable and diligent efforts.”
                                       The Demurrer
        Defendants demurred to the second amended complaint, arguing inter alia, that all
causes of action were barred by their applicable statutes of limitations.
        The trial court sustained the demurrer without leave to amend and entered
judgment of dismissal as to the moving defendants.4 As to Carpio’s tolling arguments,
the court concluded: “these allegations are insufficient to establish tolling…. To the
extent plaintiff is attempting to allege the delayed discovery of some claimed
wrongdoing, he must specifically plead facts which show not only (1) the time and
manner of discovery but also (2) the inability to have made the discovery earlier despite
reasonable diligence. Given that plaintiff was presumptively aware of not only the
foreclosure proceedings commenced in 2011 but also that such proceedings were
improperly commenced (since he maintains he did not default on his mortgage
obligations), a reasonable person in his shoes would have promptly began no later than
early 2012 an investigation into the circumstances resulting in the foreclosure
proceedings which resulted in a Trustee’s Sale.”
        The court went on: “the allegations fail to show that plaintiff could not, with
reasonable diligence, have earlier discovered the alleged wrongdoing. By plaintiff’s own
admission, the information which allowed him to discover in 2017 Defendants’ alleged
wrongdoing, including the documents which were on file at the County Recorder’s

4   Not all defendants joined the motion. Those that did not are not party to this appeal.

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Office, would have been on file and available to plaintiff as early as 2012 such that
plaintiff would have been able to discover the alleged wrongdoing years ago had he
exercised any reasonable diligence in response to the foreclosure proceeding.” The court
concluded, it could not find that “plaintiff, despite diligent efforts, was unable to discover
the facts giving rise to this action.”
       Finding the claims time barred, the court did not address the other grounds raised
in Defendants’ demurrer. The court also denied leave to amend, noting Carpio had had
three opportunities to plead a valid cause of action and finding he had no reasonable
possibility of pleading around the statute of limitation.
                                         DISCUSSION
                                 A. Plaintiff’s Contentions
       Carpio contends the trial court erred in sustaining the demurrer. He argues that
under the delayed discovery rule, his claims did not accrue until much later. He also
argues the statute of limitation period is subject to equitable tolling. We disagree.
                              B. The Delayed Discovery Rule
       “A plaintiff must bring a claim within the limitations period after accrual of the
cause of action.” (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 806; Code
Civ. Proc., § 312.) And while generally, a cause of action accrues when the cause is
complete in all its elements, an exception exists in the “delayed discovery rule,” where
the plaintiff does not discover, and has no reason to discover, the cause of action. (Fox at
pp. 803, 807.) To rely on the delayed discovery rule, the complaint must specifically
plead facts showing, “ ‘(1) the time and manner of discovery and (2) the inability to have
made earlier discovery despite reasonable diligence.’ ” (Id. at p. 808.) Conversely,
“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.” (Id. at
p. 807.)

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       Here, Carpio argues the delayed discovery rule applies because his original
mortgage provider did not give notice to its customers that it was filing for bankruptcy
protection and failed to properly transfer real property titles to Carpio’s subsequent lender
90 days before filing for bankruptcy, which closed in 2011.
       And as to the delayed discovery rule’s prongs, Carpio argues he “had no reason to
seek out his [original mortgage lender], as he had no reason to believe his Lender would
defraud him.” He adds: “No reasonable person who is not trained in the law would look
for [the original mortgage lender] in Delaware to find out what was happening with his
mortgage.” He maintains his original lender “admitted it did not notice its customers of
its bankruptcy filing” and “none of the named [defendants] had standing to sell his home
in foreclosure or to collect monthly mortgage payments from him.” And he adds: “The
evidence supporting the allegations and references to [original mortgage lender] can be
easily cured by liberal amendment to the complaint.”
       We agree with the trial court that the second amended complaint fails to plead
facts to invoke the delayed discovery rule. As the trial court pointed out, the foreclosure
occurred in 2012, and all the documents Carpio now relies on were available as early as
2012. Against that, simply alleging that in 2017 Carpio “read various media reports that
identified many homes that were possibly foreclosed upon illegally and involved various
named Defendants” is insufficient to show an inability to have made an earlier discovery
despite reasonable diligence. Nor does Carpio’s vague reference to defendants’
“fraudulent concealment of material facts” advance the claim.
       Further, nothing Carpio has argued on appeal elucidates how he could not have
timely discovered the claim through reasonable diligence. We therefore conclude that
Carpio failed to set forth facts sufficient to invoke the delayed discovery rule.
                                   C. Equitable Tolling
       “Equitable tolling is a judge-made doctrine ‘which operates independently of the
literal wording of the Code of Civil Procedure’ to suspend or extend a statute of

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limitations as necessary to ensure fundamental practicality and fairness.” (Lantzy v.
Centex Homes (2003) 31 Cal.4th 363, 370 (Lantzy).) It applies in “carefully considered
situations to prevent the unjust technical forfeiture of causes of action, where the
defendant would suffer no prejudice.”5 (Ibid.)
       As to equitable tolling, Carpio alleged in the second amended complaint that
equitable tolling would prevent the injustice of defendant “escaping liability based upon
procedural delay in Plaintiff’s efforts in seeking remedies for Defendants’ fraudulent,
wrongful and oppressive conduct relating to the fraudulently-concealed, wrongful and
illegal foreclosure sale of Plaintiff’s subject property.” And on appeal, Carpio argues in
totality: “The limitations period is subject to equitable tolling where, as here, ‘ “an
injured person has several legal remedies and, reasonably and in good faith, pursues
one.” ’ ”
       We conclude these perfunctory claims are wholly insufficient to invoke the
equitable tolling doctrine.
                                    D. Leave to Amend
       As defendant has presented nothing to persuade us he can plead facts to invoke
either the delayed discovery rule or equitable tolling, we conclude the trial court acted
within its discretion in denying leave to amend. (See Collins v. eMachines, Inc. (2011)

5  Examples include: (1) “claim against title insurer accrues upon insurer’s refusal to
defend title, but two-year limitations period is equitably tolled until underlying title
action is resolved”; (2) “one-year period to sue on casualty insurance policy begins upon
‘inception of the loss,’ but is equitably tolled from timely notice of loss until insurer
denies claim”; (3) “six-month period for state court suit against public agency was
equitably tolled during plaintiffs’ timely federal suit raising both federal and state claims”
(4); “one-year period for personal injury action was tolled while plaintiff, acting in good
faith, pursued worker's compensation remedy against defendant”; and (5) “15–month
period to sue on fire insurance policy was tolled while timely prior action, erroneously
dismissed as premature, was pending.” (Lantzy, supra, 31 Cal.4th at p. 370.)

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202 Cal.App.4th 249, 252 [“ ‘We review the court’s denial of leave to amend for abuse of
discretion’ ”].)
                                    DISPOSITION
       The judgment is affirmed.

                                                  /s/
                                               MURRAY, J.

We concur:

    /s/
RAYE, P. J.

    /s/
HULL, J.

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