Court Opinion

ID: 4687057
Source: CourtListenerOpinion
Date Created: 2021-05-14 20:00:55.965057+00
Date Added: 2024-06-11T08:04:38.425173
License: Public Domain

FILED
                            NOT FOR PUBLICATION
                                                                              MAY 14 2021
                    UNITED STATES COURT OF APPEALS                         MOLLY C. DWYER, CLERK
                                                                            U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

KWADWO HWENSO ASARE-ANTWI,                       No.   19-56383

              Plaintiff-Appellant,               D.C. Nos.
                                                 8:19-cv-00887-JVS-KES
 v.                                              5:19-cv-00928-JVS-KES

WELLS FARGO BANK, N.A., FKA
Wachovia Mortgage, FSB, FKA World                MEMORANDUM*
Savings Bank, FSB, successor by merger
with Wells Fargo Bank Southwest, N.A.,

              Defendant-Appellee,

 and

QUALITY LOAN SERVICE
CORPORATION; et al.,

              Defendants.

                    Appeal from the United States District Court
                       for the Central District of California
                     James V. Selna, District Judge, Presiding

       *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
                             Submitted May 12, 2021**
                               Pasadena, California

Before: BYBEE and BRESS, Circuit Judges, and CARDONE,*** District Judge.

      Appellant Kwadwo Asare-Antwi appeals the district court’s grant of Wells

Fargo Bank, N.A.’s (Wells Fargo) Federal Rule of Civil Procedure (FRCP)

12(b)(6) motion to dismiss his pre-foreclosure suit. We have jurisdiction pursuant

to 28 U.S.C. § 1291. We review the district court’s dismissal for failure to state a

claim under FRCP 12(b)(6) de novo. Wilson v. Lynch, 835 F.3d 1083, 1090 (9th

Cir. 2016). We affirm.

      1.     The district court did not err in dismissing Asare-Antwi’s claims for

declaratory judgment and slander of title. California law does not permit

preemptive pre-foreclosure actions that challenge authority to foreclose. Perez v.

Mortg. Elec. Registration Sys., Inc., 959 F.3d 334, 340 (9th Cir. 2020). Asare-

      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
      ***
            The Honorable Kathleen Cardone, United States District Judge for the
Western District of Texas, sitting by designation.
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Antwi’s declaratory judgment and slander of title claims challenge Wells Fargo’s

authority to foreclose and thus were properly dismissed.1

      2.     The district court did not err in dismissing Asare-Antwi’s intentional

misrepresentation and unfair and deceptive business practices (UCL) claims.

Fraud and UCL claims are subject to three- and four-year statutes of limitations,

respectively. Cal. Code Civ. Pro. § 338(d); Cal. Bus. & Prof. Code § 17208.

Asare-Antwi’s fraud and UCL claims began to accrue when he could have

discovered the negative amortization term of his loans through the exercise of

reasonable diligence. See Conerly v. Westinghouse Elec. Corp., 623 F.2d 117, 120

(9th Cir. 1980) (citing Sun ‘N Sand, Inc. v. United Cal. Bank, 582 P.2d 920, 941

(Cal. 1978)). Asare-Antwi had constructive notice upon signing in 2007 because

the terms of the loans explicitly disclosed the negative amortization feature.

Asare-Antwi’s attempts to construe his injury as continuing are without merit

because his claims are based on fraudulent inducement. See Aryeh v. Canon Bus.

Sols., Inc., 292 P.3d 871, 882 (Cal. 2013) (noting that “if the operative complaint

sounded solely in fraud and alleged a single fraud committed at contract

formation,” the theory of continuous accrual “should not save” the complaint). His

      1
        Because we find that California law does not permit claims challenging
authority to foreclose, we do not reach the district court’s findings regarding Wells
Fargo’s status as the legal creditor of Asare-Antwi’s loans.
                                          3
assertion that his injury was not complete until Wells Fargo denied modification of

his loans and refused to provide a financial accounting are “discrete, independently

actionable alleged wrongs” that do not toll his claims. See id. at 879–80. Asare-

Antwi’s remaining allegations are simply reiterations of the other claims in his

complaint. Asare-Antwi’s intentional misrepresentation and UCL claims are

untimely.

      3.     The district court did not err in finding Asare-Antwi’s breach of

contract, good faith and fair dealing, cancellation of instruments, violation of Cal.

Civ. Code § 2924, and violation of the California Homeowners’ Bill of Rights

(HBOR) claims preempted by the Home Owners’ Loan Act (HOLA), 12 U.S.C.

§§ 1461, et seq. Wells Fargo may invoke HOLA preemption because, although it is

a national bank, it acquired the loan through originating federal savings associations

(FSAs). See McShannock v. JP Morgan Chase Bank NA, 976 F.3d 881, 888–89

(9th Cir. 2020). If any of his claims fits within the confines of 12 C.F.R. § 560.2(b)

it is preempted; if it does not, the claim is presumed to be preempted if it affects

lending.2 Silvas v. E*Trade Mortg. Corp., 514 F.3d 1001, 1005 (9th Cir. 2008).

The presumption of preemption may only be rebutted if the law clearly fits under

      2
        Although the regulation has been repealed, 12 C.F.R. § 560.2 applies to
Asare-Antwi’s loans because it was the operative regulation at the time he obtained
his loans. See McShannock, 976 F.3d at 885 n.3.
                                            4
§ 560.2(c), and any doubts are resolved in favor of preemption. Id. Pursuant to the

regulation, Asare-Antwi’s claims are preempted.

      First, Asare-Antwi’s breach of contract and good faith and fair dealing claims

are preempted. Both claims hinge on his assertion that the deeds of trust

incorporate federal and state law and thus any violation of state law constitutes a

breach of contract. Although HOLA preemption does not apply to state contract

law, 12 C.F.R. § 560.2(c)(1), this is only true where the contract, rather than state

law, imposes requirements on Wells Fargo. See Campidoglio LLC v. Wells Fargo

& Co., 870 F.3d 963, 972 (9th Cir. 2017). Asare-Antwi has not identified any

contract terms that Wells Fargo allegedly breached except for violations of state law

incorporated by the deeds of trust, and application of California contract law to his

challenge to the loan’s ownership would more than incidentally affect lending. See

12 C.F.R. § 560.2(c).

      Second, Asare-Antwi’s cancellation of instruments and violation of Cal. Civ.

Code § 2924 claims are preempted. Asare-Antwi’s claims under these two

provisions challenge Wells Fargo’s authority to foreclose, and application of either

of these state laws would more than incidentally affect the “[p]rocessing,

origination, servicing, sale or purchase of, or investment or participation in,

mortgages.” See 12 C.F.R. § 560.2(b)(10).

                                           5
      Finally, HOLA preempts Asare-Antwi’s claim under the California HBOR

because the law’s imposition of procedures on mortgage servicers, trustees,

beneficiaries, and agents would more than incidentally affect lending operations.

See Cal. Civ. Code §§ 2923.55(b), 2924.17(b); 12 C.F.R. § 560.2(c).

      4.     The district court did not err in dismissing Asare-Antwi’s Real Estate

Settlement Procedures Act (RESPA) claim. RESPA entitles a borrower to actual

damages resulting from a failure to respond to a Qualified Written Request (QWR)

and statutory damages if the borrower demonstrates a pattern or practice of RESPA

violations. 12 U.S.C. § 2605(e), (f)(1). Asare-Antwi failed to allege any damages

incurred “as a result of” Wells Fargo’s alleged failure to respond to his QWR and

pointed only to the charges that were the subject of the QWR. Cf. 12 U.S.C.

§ 2605(f)(1)(A). Moreover, Asare-Antwi alleges only one RESPA violation, and a

single alleged failure to respond to a QWR is not a pattern or practice entitling him

to statutory damages. See 12 U.S.C. § 2605(f)(1)(B).

      5.     Asare-Antwi failed to plead a claim under the Truth in Lending Act

(TILA), 15 U.S.C. § 1641(g). In dismissing his second amended complaint, the

district court granted Asare-Antwi leave to file a third amended complaint to assert

a TILA claim in the first instance. Because Asare-Antwi never filed an amended

                                          6
complaint asserting a TILA claim, he has waived this claim on appeal. See First

Resort, Inc. v. Herrera, 860 F.3d 1263, 1274 (9th Cir. 2017).

      AFFIRMED.

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