Trinity Financial Services v. Svegliato CA2/3

CourtCalifornia Court of Appeal
DecidedApril 4, 2023
DocketB313697
StatusUnpublished

This text of Trinity Financial Services v. Svegliato CA2/3 (Trinity Financial Services v. Svegliato CA2/3) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Trinity Financial Services v. Svegliato CA2/3, (Cal. Ct. App. 2023).

Opinion

Filed 4/4/23 Trinity Financial Services v. Svegliato CA2/3 NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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 THREE

TRINITY FINANCIAL SERVICES B313697 LLC, (Los Angeles County Plaintiff and Respondent, Super. Ct. No. 19LBCV00423)

v.

DANIEL SVEGLIATO,

Defendant and Appellant.

DANIEL SVEGLIATO, (Los Angeles County Plaintiff and Appellant, Super. Ct. No. 19LBCV00433)

U.S. BANK, N.A., et al.,

Defendants and Respondents. APPEAL from a judgment of the Superior Court of Los Angeles County, Mark C. Kim, Judge. Dismissed. Franklin Soto Leeds and Dean Kirby, for Plaintiff, Defendant, and Appellant Daniel Svegliato. Frost Brown Todd, S. Christopher Yoo and Jacob Clark, for Plaintiff, Defendant, and Respondent Trinity Financial Services, LLC. Wright Finlay & Zak and Jonathan Fink, for Defendants and Respondents U.S. Bank National Association, as Trustee, successor in interest to Bank of America, National Association, as trustee, successor by merger to LaSalle National Bank, as trustee for GSAMP TRUST 2005-HE6, Mortgage Pass-Through Certificates, Series 2005-HE6; Western Progressive, LLC; and PHH Mortgage Corporation. _________________________

INTRODUCTION This appeal arises from a nonjudicial foreclosure sale of real property located in Long Beach, California. The foreclosure sale was scheduled for June 25, 2019, at 11:00 a.m. Prior to that date, the owner of the property, Trinity Financial Services, LLC (Trinity), contacted the foreclosure trustee and obtained a reinstatement quote to cure the default on the mortgage loan. The foreclosure trustee instructed Trinity to remit full payment of the reinstatement amount to the loan servicer no later than the date of the scheduled foreclosure sale. On June 24, the day before the sale, Trinity initiated a wire transfer of the reinstatement funds, and the transfer of funds occurred the next morning, at or around 8:07 a.m. Nevertheless, the foreclosure sale proceeded at 12:01 p.m. Appellant Daniel

2 Svegliato submitted the highest bid. The next day, the foreclosure trustee contacted Svegliato to inform him that the sale should not have taken place because the loan had been reinstated and was no longer in default. The trustee promptly returned Svegliato’s funds with interest, and a trustee’s deed upon sale was never issued to Svegliato. Litigation ensued. Trinity sued the lender, the foreclosure trustee, the loan servicer (collectively the Bank defendants), and Svegliato in one action, and Svegliato sued the Bank defendants and Trinity in another action. The trial court consolidated the actions and granted motions for summary judgment filed by the Bank defendants and Trinity. The trial court ultimately entered two judgments: a first judgment in favor of the Bank defendants, and a second judgment in favor of Trinity. Svegliato filed a notice of appeal as to the first judgment only. We dismiss the appeal as to the Bank defendants and Trinity. FACTUAL BACKGROUND The following facts are not in dispute: In October 2018, Trinity became the owner of real property located in Long Beach, California (the property) subject to a mortgage loan secured by a deed of trust.1 U.S. Bank 2 was the

1 Trinity acquired title to the property through a properly conducted nonjudicial foreclosure sale and was issued a trustee’s deed upon sale. 2 The actual name of the entity is U.S. Bank, N.A., as Trustee, Successor in Interest to Bank of America, N.A., as Trustee, Successor by Merger to LaSalle National Bank, as Trustee for GSAMP Trust 2005-HE6, Mortgage Pass-Through

3 successor in interest to the original lender and the beneficiary of the deed of trust. U.S. Bank assigned Western Progressive, LLC (Western) to act as the foreclosure trustee of the deed of trust. PHH Mortgage Corporation (PHH) serviced the mortgage loan. At the time Trinity acquired the property, the underlying mortgage loan was in default. The loan remained in default and as a result, a notice of trustee’s sale was recorded, setting the foreclosure sale date for June 25, 2019 at 11:00 a.m. Trinity sought to reinstate the loan and requested a mortgage reinstatement quote, which Western sent, via email, to Trinity on June 21, 2019. The letter containing the quote stated that the reinstatement amount of $43,060.61 “must be remitted no later than 06/25/2019.” The letter further instructed that wire transfers should be sent to M&T Bank with “Credit to: PHH Mortgage Services” and listed the bank’s routing number and PHH’s account number. On June 25, 2019, Trinity transferred to PHH the full amount via a wire from JP Morgan Chase Bank at or around 8:07 a.m. On that same date, the foreclosure sale took place at 12:01 p.m. and Svegliato submitted the highest bid. He tendered two cashier’s checks to cover the purchase price. Western received postponement instructions only after the foreclosure sale took place. The following day, Western contacted Svegliato to inform him to “walk away from the sale.” On July 11, 2019, Western returned Svegliato’s funds and informed him that it would not be issuing a trustee’s deed upon sale. On July 31, 2019, Western

Certificates, Series 2005-HE6. For brevity, we will refer to the entity as U.S. Bank.

4 sent additional funds to Svegliato to cover interest from the sale date to the date the cashier’s checks were returned to Svegliato. A trustee’s deed upon sale in favor of Svegliato was never issued or recorded. PROCEDURAL HISTORY I. Proceedings in the trial court A. The two complaints On June 28, 2019, Trinity sued the Bank defendants and Does 1 through 25 in case No. 19LBCV00423, alleging three causes of action: (1) to quiet title to the property; (2) to void the trustee’s sale; and (3) for declaratory relief in the form of a judicial determination that Trinity possessed title to the property in fee simple. Trinity subsequently amended the complaint to name Svegliato as a Doe defendant. On August 14, 2019, Svegliato filed a first amended complaint against Western Progressive, PHH, Trinity, and Does 1 through 503 in case No. 19LBVC00433, alleging three causes of action: (1) declaratory relief against Western and PHH in the form of a judicial determination that PHH’s acceptance of the reinstatement funds was improper and that Svegliato was the “record owner” of the property; (2) breach of contract against

3 Although U.S. Bank was not named in Svegliato’s first amended complaint, U.S. Bank filed an answer to that pleading on behalf of itself, Western, and PHH. The answer constituted a general appearance in the action by U.S. Bank. (Fireman’s Fund Ins. Co. v. Sparks Construction, Inc. (2004) 114 Cal.App.4th 1135, 1145 [“Filing an answer on the merits constitutes a general appearance.”].)

5 Western and PHH; and (3) to quiet title to the property as to Western, PHH, and Trinity. The parties stipulated to consolidate the two complaints. On February 15, 2020, the trial court accepted the stipulation, ordered the two actions consolidated, and designated the first case (case No. 19LBCV00423) as the lead case. B. The summary judgment motions The Bank defendants filed a motion for summary judgment as to all causes of action alleged by Svegliato. Trinity also filed a motion for summary judgment as to all of its causes of action against the Bank defendants and Svegliato, and as to Svegliato’s cause of action to quiet title. Svegliato filed separate oppositions to each motion for summary judgment.

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