Court Opinion

ID: 3155781
Source: CourtListenerOpinion
Date Created: 2015-11-18 21:02:58.027617+00
Date Added: 2024-06-11T12:03:05.201319
License: Public Domain

Filed 11/18/15 Melstrom v. Green Tree Servicing CA2/5
                  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication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

                                     SECOND APPELLATE DISTRICT

                                                  DIVISION FIVE

MICHAEL D. MELSTROM et al.,                                          B259105

         Plaintiffs and Appellants,                                  (Los Angeles County
                                                                     Super. Ct. No. KC066303)
         v.

GREEN TREE SERVICING, LLC et al.,

         Defendants and Respondents.

         APPEAL from a judgment of the Superior Court of the County of Los Angeles,
Robert A. Dukes, Judge. Affirmed.
         Stephen R. Golden & Associates, Timothy L. McCandless for Plaintiffs and
Appellants.
         Severson & Werson, Jan T. Chilton, Kerry W. Franich for Defendants and
Respondents.
                                    INTRODUCTION

       Plaintiffs and appellants Michael D. Melstrom and Patra Melstrom appeal from a
judgment of dismissal entered after the trial court sustained the demurrer of defendants
and respondents Green Tree Servicing LLC (Green Tree) and Federal National Mortgage
Association (Federal National) (collectively defendants) without leave to amend.
Plaintiffs’ lawsuit essentially challenges a sale of their real property pursuant to a non-
judicial foreclosure. Plaintiffs contend that the trial court erred in sustaining the demurrer
because defendants made false representations to plaintiffs, plaintiffs were not required to
allege tender of the full amount of the debt in order to pursue their claims, they had
standing to assert claims that the deed of trust was void based on an alleged violation of a
pooling and service agreement to which agreement plaintiffs were not parties, and they
were not required to allege that they were damaged regarding their claim for violation of
Business & Professions Code section 17200 et seq. (UCL). We affirm the judgment.

                              FACTUAL BACKGROUND1

       In August 2007 plaintiffs obtained a loan from National City Mortgage, a division
of National City Bank, which loan was secured by a deed of trust on real property they
owned in West Covina, California. National City Bank was the trustee under the deed of
trust and National City Mortgage was the beneficiary.
       In February 2010, the deed of trust was assigned to Green Tree. Green Tree
substituted Northwest Trustee Services, Inc. as the trustee under the deed of trust in place
of National City Bank. Plaintiffs defaulted on their payments, and in July 2011, a notice
of default was recorded. In November 2011, and December 2012, notices of trustee’s
sale were recorded.

1
        We state the facts as alleged in the operative complaint and from matters of which
the trial court took judicial notice.

                                              2
       In or about January 2013, plaintiffs entered into negotiations with Green Tree for a
short-sale of the property. Plaintiffs alleged in their operative complaint that defendants
“led Plaintiffs to believe that their house would not be sold at a foreclosure sale”;
plaintiffs were promised that they “could move forward with the short sale if they came
out of bankruptcy or got a court order to move forward with the short sale”; Green Tree
represented to them that they were “in negotiations for a short-sale, in lieu of a
foreclosure sale of their home,” and “in order to go forward with the Short Sale”
plaintiffs would either have to obtain a court order approving the sale or “come out of
Bankruptcy”; defendants represented by, inter alia, “repeatedly postponing the scheduled
sale date of the PROPERTY, and informing Plaintiffs or their agents that their file was
being reviewed, on multiple occasions,” that defendants “would proceed with the review
of a short sale if Plaintiffs were no longer in bankruptcy”; and defendants “led Plaintiffs
to believe” that their property would not be sold at a foreclosure sale during the short-sale
negotiations. Plaintiffs also alleged that in July 2013 they “removed” the bankruptcy
proceeding.
       Prior to September 5, 2013, the deed of trust was assigned to Federal National (aka
Fannie Mae). In or about September 2013, defendants foreclosed on the property, and it
was purchased by Federal National (aka Fannie Mae) at the trustee’s sale.2 Plaintiffs
alleged in their operative complaint that the foreclosure sale was void because their loan
was not transferred into a securitized trust by the deadline required by a pooling and
servicing agreement.

2
      The assignment was made to, and the purchase of the property was made by,
“Federal National Mortgage Association a/k/a Fannie Mae.”

                                              3
                            PROCEDURAL BACKGROUND

       In September 2013, plaintiffs filed their complaint, and defendants filed a
demurrer to it. Plaintiffs thereafter filed a filed a first amended complaint,3 and
defendants again filed a demurrer.4
       Plaintiffs filed the operative, second amended complaint, asserting causes of
action for promissory estoppel (first cause of action), negligent misrepresentation (second
cause of action), quiet title (third cause of action), wrongful foreclosure (fourth cause of
action), declaratory relief (fifth cause of action), to set aside trustee sale (sixth cause of
action), to cancel trustee sale (seventh cause of action), and violation the UCL (eighth
cause of action). Defendants demurred to the second amended complaint.
       The trial court sustained the demurrer to the first cause of action for promissory
estoppel on the basis that plaintiffs did not allege that defendants made the clear promise
or specific agreement that they would not sell the home at a foreclosure sale; to the
second cause of action for negligent misrepresentation on the basis that plaintiffs did not
allege that defendants promised “not” to conduct a sale; to the third through seventh
causes of action for quiet title, wrongful foreclosure, declaratory relief, to set aside trustee
sale, and to cancel trustee sale on the basis that plaintiffs did not allege that they tendered
the debt, they admit they have no equity in the property, and they do not have standing to
assert a claim based on alleged violations of the securitized trust’s pooling and service
agreement that allegedly rendered the assignment of the deed of trust void; and to the
eighth cause of action for violation of the UCL on the basis that plaintiffs lacked standing
to pursue the claim.
       Judgment was thereafter entered in favor of defendants. Plaintiffs filed a timely
notice of appeal.

3
      According to defendants, plaintiffs filed their first amended complaint before
defendants’ demurrer to the original complaint was heard.
4
       Defendants’ state that their demurrer to the first amended complaint was sustained
with leave to amend.

                                               4
                                       DISCUSSION

       A.       Record of Appeal
       Because the record does not contain a reporter’s transcript of the hearing on the
demurrer, we asked the parties to brief whether plaintiffs’ failure to provide a reporter’s
transcript or a suitable substitute warrants affirmance based on the adequacy of the
record. Plaintiffs did not brief the issue, but defendants state that “the failure to provide a
reporter’s transcript does not warrant a summary affirmance. . . . . [W]hat might have
been said at the demurrer hearing is irrelevant in determining the legal sufficiency of the
causes of action the [plaintiffs’] tried to allege in the complaint.”
       As noted below, we review a ruling on a demurrer under a de novo standard.
(Phillips v. Bank of America, N.A. (2015) 236 Cal. App. 4th 217, 224.) Under the
circumstances, the record is adequate to address the trial court’s ruling on the demurrer
despite the lack of a reporter’s transcript. We agree however with defendants argument,
as discussed below, that “the failure to procure [the reporter’s] transcript does preclude
[plaintiffs’] from claiming that they proposed viable amendments to the complaint in the
trial court.”

       B.       Standard of Review
       A ruling on a demurrer is reviewed under a de novo standard. (Phillips v. Bank of
America, N.A., supra, 236 Cal.App.4th at p. 224.) As the Supreme Court has observed,
“In reviewing the sufficiency of a complaint against a general demurrer, we are guided by
long-settled rules. ‘We treat the demurrer as admitting all material facts properly
pleaded, but not contentions, deductions or conclusions of fact or law. [Citation.] We
also consider matters which may be judicially noticed.’ [Citation.] Further, we give the
complaint a reasonable interpretation, reading it as a whole and its parts in their context.
[Citation.] When a demurrer is sustained, we determine whether the complaint states
facts sufficient to constitute a cause of action. [Citation.] And when it is sustained
without leave to amend, we decide whether there is a reasonable possibility that the

                                               5
defect can be cured by amendment: if it can be, the trial court has abused its discretion
and we reverse; if not, there has been no abuse of discretion and we affirm. [Citations.]
The burden of proving such reasonable possibility is squarely on the plaintiff.
[Citation.]” (Blank v. Kirwan (1985) 39 Cal. 3d 311, 318.)

       C.     Plaintiffs’ Two Theories
       Plaintiffs’ second amended complaint is based upon two theories. The first theory
is that defendants led them to believe that if they dismissed their bankruptcy case, the
foreclosure sale would be postponed and the plaintiffs could short sell5 the property. The
second theory is that the foreclosure sale is void because the assignment of deed of trust
breached a pooling and servicing agreement. The trial court did not err in sustaining
defendants’ demurrer.

              1.     The Lost Short Sale Theory
       Plaintiffs’ causes of action for promissory estoppel (first cause of action),
negligent misrepresentation (second cause of action), and violation of the UCL (eighth
cause of action), rely on the same contention: that Green Tree misled them to believe
that the foreclosure sale would be postponed and that they could short sell the property if
their bankruptcy case was dismissed. The demurrer was properly sustained to each of
these causes of action.
       Plaintiffs alleged in their promissory estoppel cause of action that defendants “led
Plaintiffs to believe that their house would not be sold at a foreclosure sale,” and
plaintiffs were promised that they “could move forward with the short sale” if they “came
out of bankruptcy or got a court order to move forward with the short sale.” Plaintiffs
alleged in their negligent misrepresentation cause of action that Green Tree represented to
them that they were “in negotiations for a short-sale, in lieu of a foreclosure sale of their
home,” and “in order to go forward with the Short Sale” plaintiffs would either have to

5
       “A ‘short sale’ is a sale of property for a price that is less than the amount of debt
on the property.” (4 Miller & Starr, Cal. Real Estate (3d ed. 2011) § 10:120, p. 10-423.)

                                              6
obtain a court order approving the sale, or “come out of Bankruptcy.” Plaintiffs also
alleged that defendants represented by, inter alia, “repeatedly postponing the scheduled
sale date of the PROPERTY, and informing Plaintiffs or their agents that their file was
being reviewed, on multiple occasions,” that defendants “would proceed with the review
of a short sale if Plaintiffs were no longer in bankruptcy.” Plaintiffs alleged in their UCL
cause of action that defendants “[led] Plaintiffs’ to believe” that their property would not
be sold at a foreclosure sale during the short-sale negotiations.
       Plaintiffs did not allege that defendants promised or otherwise represented to them
that the short sale would be approved, or that the foreclosure sale would not occur or
would be postponed. Plaintiffs merely alleged that defendants represented that they were
in “negotiations” for a short-sale, in lieu of a foreclosure sale of their home;” “in order to
go forward with the Short Sale” plaintiffs would either have to obtain a court order
approving the sale, or “come out of Bankruptcy’” and defendants “would proceed with
the review of a short sale.” Plaintiffs also merely alleged that defendants promised them
that they “could move forward with the short sale.” In addition, what plaintiffs’
subjectively believed is not the same as what was actually promised or represented.
Plaintiffs have not stated facts sufficient to establish a misrepresentation.

                     a)      Promissory Estoppel
       “The elements of promissory estoppel are (1) a clear and unambiguous promise by
the promisor, and (2) reasonable, foreseeable and detrimental reliance by the promisee.”
(Bushell v. JPMorgan Chase Bank, N.A. (2013) 220 Cal. App. 4th 915, 929; Wells Fargo
Bank, N.A. v. FSI, Financial Solutions, Inc. (2011) 196 Cal. App. 4th 1559, 1573.)
Judicially noticed documents establish that plaintiff did not rely on the alleged promise
made to them. As noted above, plaintiffs alleged in their promissory estoppel cause of
action that plaintiffs were promised that they “could move forward with the short sale” if
they “came out of bankruptcy or got a court order to move forward with the short sale.”
Plaintiffs alleged that the promise was made in May 2013, and they therefore “removed”
the bankruptcy proceeding in July 2013. The trial court however granted defendants’

                                              7
request for judicial notice of, inter alia, the dockets in plaintiffs’ four bankruptcy
proceedings (two bankruptcy proceedings for each plaintiff). Those judicially noticed
documents establish that plaintiffs’ four bankruptcy proceedings were dismissed before
the alleged May 2013 promise. These documents therefore establish that plaintiff did not
rely on the alleged promise made to them.

                      b)     Negligent Misrepresentation
        “The elements of negligent misrepresentation are ‘“[M]isrepresentation of a past
or existing material fact, without reasonable ground for believing it to be true, and with
intent to induce another’s reliance on the fact misrepresented; ignorance of the truth and
justifiable reliance on the misrepresentation by the party to whom it was directed; and
resulting damage. [Citation.]” [Citation.]’ (Shamsian v. Atlantic Richfield Co. (2003)
107 Cal. App. 4th 967, 983 [132 Cal. Rptr. 2d 635].)” (Hasso v. Hapke (2014) 227
Cal. App. 4th 107, 127.)
       Plaintiffs dedicate one paragraph of their appellate brief to their negligent
misrepresentation cause of action, and do not argue why the facts alleged in the operative
complaint are sufficient to constitute a cause of action. Plaintiffs therefore have forfeited
their claim that the trial court erred in sustaining defendants’ demurrer to that cause of
action because they sufficiently pled that cause of action. “‘“Although our review of a
[demurrer] is de novo, it is limited to issues [that] have been adequately raised and
supported in plaintiffs’ brief. [Citations.] Issues not raised in an appellant’s brief are
deemed waived or abandoned. [Citation.]”’ [Citation.] An appellate court ‘will not
develop the appellants’ arguments for them . . . .’ [Citation.]” (Pfeifer v. Countrywide
Home Loans, Inc. (2012) 211 Cal. App. 4th 1250, 1282, fns. omitted.)

                                               8
       Even if we were to reach the merits, as noted above, plaintiffs alleged in their
negligent misrepresentation cause of action that Green Tree represented to them that they
were “in negotiations for a short-sale, in lieu of a foreclosure sale of their home,” and “in
order to go forward with the Short Sale” plaintiffs would either have to obtain a court
order approving the sale, or “come out of Bankruptcy.” These alleged misrepresentations
are not misrepresentations that defendants promised or otherwise represented to plaintiffs
that the short sale would be approved, or that the foreclosure sale would not occur or
would be postponed.

                      c)     UCL
       “The UCL permits civil recovery for ‘any unlawful, unfair or fraudulent business
act or practice and unfair, deceptive, untrue or misleading advertising . . . .’ [Citation.]
‘“Because Business and Professions Code section 17200 is written in the disjunctive, it
establishes three varieties of unfair competition—acts or practices which are unlawful, or
unfair, or fraudulent. . . .”” [Citation.]” (Lueras v. BAC Home Loans Servicing, LP
(2013) 221 Cal. App. 4th 49, 80-81.) A plaintiff does not have standing to sue under the
UCL unless he or she “has lost money or property as a result of the unfair competition.”
(Bus. & Prof. Code, § 17204.)
       As the trial court stated in sustaining the demurrer to the UCL cause of action,
plaintiffs lack standing to sue under the UCL. They did not allege that they lost money or
property. Indeed, the foreclosure proceedings plaintiffs complain of were the result of
their default on the loan, and their default on the loan occurred before any alleged
conduct in violation of the UCL.
       Citing Daugherty v. American Honda Motor Co., Inc. (2006) 144 Cal. App. 4th 824
at page 838, plaintiffs contend that “a Business and Professions Code section 17200
violation can be shown even without allegations of . . . damage.” Daugherty cited to
Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal. 3d 197
for that proposition, and that case makes clear that to state a cause of action “for
injunctive relief” under that section, allegations “of damage are unnecessary.” (Id. at p.

                                              9
211.) Although in addition to alleging that they suffered general and special damages,
they alleged that they “seek injunctive relief to enjoin future harmful conduct” to them.
Because, the trustee sale occurred, however, there is no “future” harmful conduct under
the UCL to enjoin.

               2.     The Delayed Securitization Theory
        Plaintiffs’ causes of action for quiet title (third cause of action), wrongful
foreclosure (fourth cause of action), declaratory relief (fifth cause of action), to set aside
trustee sale (sixth cause of action), and cancel trustee deed (seventh cause of action)
causes of action rely on the same contention, alleged based on information and belief:
that the foreclosure sale was void because their loan was not transferred into a securitized
trust by the deadline required by a pooling and servicing agreement. The demurrer was
properly sustained to each of these causes of action.

                      a)      Standing
        Plaintiffs lack standing to challenge the assignment of the deed of trust because
they are not parties to the assignment or the pooling and servicing agreement that was
supposedly violated. In Jenkins v. JPMorgan Chase Bank, N.A. (2013) 216 Cal. App. 4th
497 (Jenkins), as in this case, the plaintiff borrower alleged that her loan was pooled with
other loans in a securitized investment trust without proper compliance with the pooling
and servicing agreement. The court affirmed the trial court’s order sustaining a demurrer
to a declaratory relief cause of action, holding, inter alia, that the plaintiff lacked standing
to challenge the alleged violations of the assignment and pooling and servicing
agreements because the plaintiff was not a party to those agreements. (Id. at pp. 514-
515.)
        The court in Jenkins, supra, 216 Cal. App. 4th 497 stated: “[E]ven if the asserted
improper securitization (or any other invalid assignments or transfers of the promissory
note subsequent to [the plaintiff’s] execution of the note . . .) occurred, the relevant
parties to such a transaction were the holders (transferors) of the promissory note and the

                                               10
third party acquirers (transferees) of the note. ‘Because a promissory note is a negotiable
instrument, a borrower must anticipate it can and might be transferred to another creditor.
As to [the] plaintiff, an assignment merely substituted one creditor for another, without
changing her obligations under the note.’ (Herrera [v. Federal National Mortgage
Association (2012)] 205 Cal.App.4th [1495,] 1507.) As an unrelated third party to the
alleged securitization, and any other subsequent transfers of the beneficial interest under
the promissory note, [the plaintiff] lacks standing to enforce any agreements, including
the investment trust’s pooling and servicing agreement, relating to such transactions.
(See In re Correia (Bankr. 1st Cir. 2011) 452 B.R. 319, 324-325 [debtors lacked standing
to raise violations of pooling and service agreement].) [¶] Furthermore, even if any
subsequent transfers of the promissory note were invalid, [the plaintiff] is not the victim
of such invalid transfers because her obligations under the note remained unchanged.
Instead, the true victim may be an individual or entity that believes it has a present
beneficial interest in the promissory note and may suffer the unauthorized loss of its
interest in the note. It is also possible to imagine one or many invalid transfers of the
promissory note may cause a string of civil lawsuits between transferors and transferees.
[The plaintiff], however, may not assume the theoretical claims of hypothetical
transferors and transferees for the purposes of showing a ‘controversy of concrete
actuality.’ (See Jessin [v. County of Shasta (1969)] 274 Cal.App.2d [737,] 743
(Jessin).)” (Jenkins, supra, 216 Cal.App.4th at pp. 514-515.)
       Notwithstanding the holding in Jenkins, supra, 216 Cal. App. 4th 497, plaintiffs cite
Glaski v. Bank of America, N.A. (2013) 218 Cal. App. 4th 1079 (Glaski), contending that
they have standing to complain about the assignment of the deed of trust and for that
proposition. The court in Glaski—without discussing the holding in Jenkins—held that
the borrower in that case did have standing to assert a post-foreclosure cause of action for
wrongful foreclosure based on the alleged failure of the assignor of the deed of trust to
effect the assignment prior to the closing date of the securitized trust. (Id. at p. 1097.)
       Subsequent to the decision in Glaski, supra, 218 Cal. App. 4th 1079, the recent case
of Kan v. Guild Mortgage Co. (2014) 230 Cal. App. 4th 736 (Kan) held, consistent with

                                              11
the holding in Jenkins, supra, 216 Cal. App. 4th 497, that the borrowers did not have
standing to enforce the rights of third parties in assignment and pooling and servicing
agreements. (Kan, supra, 230 Cal.App.4th at pp. 741-743.) The Court in Kan was
critical of Glaski’s holding on the standing issue because it deviated from the weight of
California6 and federal authority. (Kan, supra, 230 Cal.App.4th at p. 744.)
       In Kan, the court observed in dicta that the “vast majority of [federal] courts
analyzing [Glaski, supra, 218 Cal. App. 4th 1079] have found it unpersuasive. (See, e.g.,
Miller v. JPMorgan Chase Bank N.A. (N.D.Cal., Aug. 8, 2014, No. 5:13-CV-03192-EJD)
2014 U.S.Dist. Lexis 110038, pp. *11-*12 [‘Courts in this District have expressly
rejected Glaski . . . .’]; Tavares v. Nationstar Mortgage LLC (S.D.Cal., July 14, 2014,
No. 14cv216-WQH-NLS) 2014 U.S.Dist. Lexis 95537, p. *9 [finding Glaski’s reasoning
unpersuasive]; Zapata v. Wells Fargo Bank, N.A. (N.D.Cal., Dec. 10, 2013, No. C 13-
04288 WHA) 2013 U.S.Dist. Lexis 173187, p. *5 [‘Every court in this district that has
evaluated Glaski has found it is unpersuasive and not binding authority’]; Davies v.
Deutsche Bank National Trust Co. (In re Davies) (9th Cir., Mar. 24, 2014, No. 12-60003)
565 Fed.Appx. 630 [2014 U.S.App. Lexis 5416, pp. *4-*5] [following Jenkins instead of
Glaski]; Rajamin v. Deutsche Bank National Trust Co. (2d Cir. 2014) 757 F.3d 79
[disagreeing with Glaski’s interpretation of New York law; finding improper transfer into
investment trust is voidable, not void].)” (Kan, supra, 230 Cal.App.4th at p. 744.)
       In addition, Glaski, supra, 218 Cal. App. 4th 1079 followed a New York decision,
Wells Fargo Bank, N.A. v. Erobobo (2013) 39 Misc.3d 1220(A) (Erobobo I), which
stated: “‘Under New York Trust Law, every sale, conveyance or other act of the trustee
in contravention of the trust is void. EPTL § 7-2.4. Therefore, the acceptance of the note

6
       Several Court of Appeal decisions that rejected the holding in Glaski, supra, 218
Cal. App. 4th 1079 and held that borrowers did not have standing to challenge allegedly
void assignments of their notes and deeds of trust are currently pending review in the
Supreme Court. (See Boyce v. T.D. Service Co., review granted July 15, 2015, S226267;
Mendoza v. JPMorgan Chase Bank, N.A., review granted Nov. 12, 2014, S220675;
Keshtgar v. U.S. Bank, N.A., review granted Oct. 1, 2014, S220012; and Yvanova v. New
Century Mortgage Corp., review granted Aug. 27, 2014, S218973.)

                                             12
and mortgage by the trustee after the date the trust closed, would be void. [Citations.]’”
(Glaski, supra, 218 Cal.App.4th at p. 1097.) Erobobo I has since been reversed. (Wells
Fargo Bank, N.A. v. Erobobo (2015) 127 A.D.3d 1176 (Erobobo II).) The court in
Erobobo II, supra, 127 A.D.3d 1176, at page 1178, held that a borrower whose loan was
assigned to a securitized trust has no standing to challenge the assignee’s status “based on
purported noncompliance with certain provisions of the” pooling and servicing
agreement.
       As noted above, the issue of whether the reasoning in Glaski, supra, 218
Cal. App. 4th 1079 is meritorious in light of the overwhelming number of authorities
rejecting that reasoning is currently pending before the Supreme Court, which
presumably will resolve the conflict when it issues its opinion on that matter. Until then,
we follow the weight of the authorities that hold that borrowers, such as plaintiffs, lack
standing to assert a claim based on alleged violations of the securitized trust’s pooling
and service agreement that allegedly rendered the assignment of the deed of trust void.
       Plaintiffs also contend, without citation to the record, that the “[c]lear language in
the Deed of Trust gives the borrower—[plaintiffs], in this case—the right to sue to
determine if the actual ‘Lender’ is exercising the power to foreclose.” Contrary to
plaintiffs’ contention, however, the deed of trust does not expressly authorize plaintiffs to
file a lawsuit to determine if the actual “Lender” is exercising the power to foreclose.
The deed of trust merely expressly authorizes a lawsuit “to assert the non-existence of a
default or any other defense of Borrower to acceleration and sale.” Plaintiffs’ operative
complaint does not dispute that they defaulted on the loan, nor does it assert a defense to
an “assignment and sale” under the deed of trust.
       Plaintiffs also claim that they can challenge the allegedly invalid assignment of
their loans to a securitized trust because the deed of trust is an adhesion contract.
Plaintiffs’ contention is without merit. Plaintiffs did not allege in the operative complaint
that the deed of trust is an adhesion contract. In addition, they allege no facts regarding a
disparity in bargaining power, an inability to shop for better terms, or plaintiffs’ lack of
sophistication. In any event, the deed of trust does not grant plaintiffs standing or

                                              13
otherwise refer to their ability to judicially challenge the assignment of their note and
deed of trust.

                      b)     Tender
       The trial court also properly sustained defendant’s demurrer because plaintiffs
failed to allege a tender of the money they borrowed. Typically, a borrower who defaults
on his payments is “required to allege tender of the amount of [the lender’s] secured
indebtedness in order to maintain” a cause of action challenging a foreclosure sale.
(Abdallah v. United Savings Bank (1996) 43 Cal. App. 4th 1101, 1109; see Stebley v.
Litton Loan Servicing, LLP (2011) 202 Cal. App. 4th 522, 526; United States Cold Storage
v. Great Western Savings & Loan Assn. (1985) 165 Cal. App. 3d 1214, 1225.)
       “Tender [however] is not required where the foreclosure sale is void, rather than
voidable . . . .” (Glaski, supra, 218 Cal.App.4th at p. 1100, citing Lester v. J.P. Morgan
Chase Bank (N.D.Cal. 2013) 926 F. Supp. 2d 1081, 1093.) Plaintiffs contend that they are
not required to allege tender of the full amount of the debt because, under Chan v. Chase
Home Fin. LLC (C.D.Cal. June 18, 2012, No. CV 11-01486 GAF (Ex)) 2012 U.S.Dist.
Lexis 189932, p. 11, a plaintiff is not required to allege tender when the foreclosure sale
is void because the servicer of the loan had agreed to postpone the foreclosure sale.
Plaintiffs’ contention is without merit because, as noted above, plaintiffs did not allege
that defendants promised or otherwise represented to them that the foreclosure sale would
not occur or would be postponed. Similarly, as also discussed above, notwithstanding the
minority holding in Glaski, supra, 218 Cal. App. 4th 1079, plaintiffs lack standing to
assert a claim based on alleged violations of the securitized trust’s pooling and service
agreement allegedly rendering the assignment of the deed of trust void. Because
plaintiffs have not alleged facts sufficient to establish that the foreclosure sale is void,
and failed to allege that they tendered the money they borrowed, the trial court did not err
is sustaining defendant’s demurrer.

                                              14
       D.     Leave to Amend
       Plaintiffs contend that the trial court abused its discretion when it denied them
leave to amend their second amended complaint. But plaintiffs have not provided a
reporter’s transcript of the hearing on the demurrer or an agreed or settled statement.
(Cal. Rules of Court, rule 8.130(h).) Without a reporter’s transcript or an agreed or
settled statement, the record is silent as to the reasons the trial court denied leave to
amend. As a result, we cannot, for example, determine whether plaintiff offered
proposed amendments and, if so, the trial court’s response to those proposals. A
judgment or order of the trial court is presumed correct on appeal. We must affirm a
judgment or order unless the appellant affirmatively demonstrates an abuse of discretion.
(Hearn v. Howard (2009) 177 Cal. App. 4th 1193, 1200-1201; People v. Seneca Ins. Co.
(2004) 116 Cal. App. 4th 75, 80.) Plaintiffs did not even state before this court how they
would amend. Because there is no record of the hearing on the demurrer, plaintiffs have
failed to satisfy their burden on appeal of demonstrating an abuse of discretion.

                                           DISPOSITION

       The judgment is affirmed. Defendants are awarded costs on appeal.
       NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

                                                   MOSK, J.

We concur:

              TURNER, P. J.

              KRIEGLER, J.

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