CA 5th DCA: Magical Presumptions Are Not Enough

Finally the courts are coming back to real law as opposed to invented doctrine designed to let the banks win. The significance of this case cannot be overstated.

Importantly, this case shows that a pro se litigant (without counsel) can win on appeal after being steamrolled in the trial court.

Get a consult and Chain of Title Analysis! 202-838-6345
https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments.
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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Hat tip to Attorney Charles Marshall
Wall Street is not going to like this decision. The Justices on the 5th DCA (CA) have returned us to basic law.
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The financial institution convinced the trial court that
(1) it was, in fact, the beneficiary under the deed of trust,
(2) a properly appointed substitute trustee conducted the foreclosure proceedings, and
(3) the plaintiff lacked standing to claim the foreclosure was wrongful.
The financial institution argued its chain of title to the deed of trust was established by facts stated in recorded assignments of deed of trust and a recorded substitution of trustee. The trial court took judicial notice of the recorded documents. …
On appeal, plaintiff contends he has standing to challenge the foreclosure and, furthermore, the judicially noticed documents do not establish the financial institution actually was the beneficiary under the deed of trust. We agree.
The reasoning of the court could not be more simple:

As to standing, the holding in Yvanova v. New Century Mortgage Corp. (2016) 62 Cal.4th 919 (Yvanova) clearly establishes plaintiff has standing to challenge the nonjudicial foreclosure on the ground that the foreclosing party lacked the authority to initiate the foreclosure because it held no beneficial interest under the deed of trust.

As to establishing facts by judicial notice, it is well recognized that courts may take notice of the existence and wording of recorded documents, but not the disputed or disputable facts stated therein. (Yvanova, supra, 62 Cal.4th at p. 924, fn. 1; Herrera v. Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366, 1375 (Herrera).)

Under this rule, we conclude the facts stated in the recorded assignments of deed of trust and the substitution of trustee were not subject to judicial notice.

Therefore, the financial institution did not present evidence sufficient to establish its purported chain of title to the deed of trust. Consequently, the financial institution failed to show it was the owner of the deed of trust and had the authority to foreclose on plaintiff’s residence.

We therefore reverse the judgment and remand for further proceedings.

Why is this significant?

Hundreds of thousands of foreclosures were “completed” under the false assumption that there were magical presumptions preventing the homeowner from defending and guaranteeing a win for so-called beneficiary under a deed of trust.

The first magical presumption erroneously applied in foreclosure litigation has been on the doctrine of “judical notice.” Judges have been erroneously ruling that once a judically “noticed” document is admitted into evidence, everything in it represents a proffer of evidence which is accepted by the court into evidence.Once the words of the contested document are in evidence, the burden shifts to the homeowner to discredit them, but no objection can be

Once the words of the contested document are in evidence, the burden shifts to the homeowner to discredit them, but no objection can be riased as to hearsay, best evidence or anything else. Banks have been working this angle not only by asking for judicial notice of documents in the county recording office; they have also slyly uploaded all sorts of documents to the SEC site and then asking for judicial notice even though the document was not a government document, upon which the court can place great weight. By accepting the words in the document as evidence under the judicial notice doctrine, the burden shifts to the homeowner to disprove a false statement without any facts or testimony.

That is why it is so important to require the foreclosing party to prove its prima facie case. It is also one of the fundamental defects in the way that nonjudicial procedures are applied. The homeowner is set with the task of disproving allegations that have not been made except by implication in a substitution of trustee, notice of default and notice of sale.

Judicial notice has been liberally applied but the law has always been that contested facts within the document to be “noticed” by the court were not subject to judicial notice. If they are not subject to judicial notice then that means those words that are contested are not admitted into evidence. If they are not admitted into evidence there is an absence of proof. Unless the bank comes up with a different way of getting those words into evidence — with proper foundation — they lose.

The second magical presumption erroneously applied in foreclosure litigation has been some sort of doctrine of concoction on standing to defend.  This is a nonsensical and unsupportable doctrine in which the homeowner may not defend the case using a defense that the party ostensibly foreclosing has no right, justification or excuse for doing so.

In Yvanova, supra, the California Supreme Court inexplicably held that the homeowner can sue for damages for a wrongful foreclosure based upon false instruments and lack of authroity but that the homeowner could not stop the foreclosure itself. Far from being the last word on this subject, the doctrine is leaking badly all over the country. If a homeowner has a right to damages because the foreclosure should never have been conducted, then exactly how could the homeowner be prevented from stopping it in the first place?

Practice Hint: Oppose Motions for Judicial Notice, File Motions in Limine, File Motions for Summary Judgment, Enforce discovery and preserve the issues on appeal.  And of course only TIMELY and well-founded objections are preserved for appeal. If you think the Judge is applying one or more of the magical presumptions then  make sure it is clear on the record that this is what the Judge was doing. Question the Judge if necessary. Narrow it down. If there is another possible explanation for the ruling the appeals court will affirm based upon the other possible explanation.

6 Responses

  1. PROOF OF SERVICE
    Guliex v. PennyMac Holdings, LLC
    Case No. F073142

    I, _____________, am over the age of eighteen and not a party to this action. My business address is ______________________, San Francisco, California 94122. On the date set forth below, I served the foregoing REQUEST FOR PUBLICATION OF OPINION for the above referenced case, by placing a copy of the document in a sealed envelope with first-class postage fully prepaid placing the envelope for collection and mailing with the United States Postal Service following our ordinary business practices, addressed to:

    Fred Guliex
    25495 Judith Street
    Arvin, CA 93203

    Stephanie N. West
    Law Office of Stefanie N. West
    18377 Beach Blvd., Ste 333
    Huntington Beach, CA 92648-5694

    Justices
    Hon. Herbert I. Levy
    Hon. Brad R. Hill
    Hon. Gene M. Gomes
    California Court of Appeal
    Fifth Appellate District
    2424 Ventura Street
    Fresno, CA 93721

    PENNYMAC HOLDINGS LLC
    C/O
    Christopher L. Peterson
    Duncan Peterson, LLP
    9665 Chesapeake Dr., Suite 305
    San Diego, CA 92123-1352

    I declare under penalty under the laws of the State of California that the information stated above is true and correct.

    Dated: July 28, 2017

    By:

  2. (Attribution to Charles Cox)

    Sample Letter:

    Hon. Herbert I. Levy
    Hon. Brad R. Hill
    Hon. Gene M. Gomes
    California Court of Appeal
    Fifth Appellate District
    2424 Ventura Street
    Fresno, CA 93721

    Re: Guliex v. PennyMac Holdings LLC
    Case No. F073142, Decision Filed July 12, 2017

    REQUEST FOR PUBLICATION OF OPINION

    Dear Justices of the Fifth Appellate District of the California Court of Appeal,

    Pursuant to California Rules of Court (“CRC”), Rule 8.1120(a) et seq., I am writing to respectfully and timely request certification for publication of the Court’s entire Opinion, or in the alternative, partial publication of Parts I. et seq. and II.B., for the case captioned above.
    My interest in this request relates to the engineered attacks upon home ownership by unauthorized intermediaries engaged in self-help that is California’s
    non-judicial foreclosure process; and the application, interpretation, clarification and addressing of the facts in this instant case by the Appellate Court and its distinguishing other holdings involving legal issues of continuing public interest as well as clarification of certain specifics related to this field of litigation as the Opinion(s) may apply to other cases more readily once published.
    The Opinion meets the standard for publication as authorized by CRC, Rule 8.1105(c) which provides that an opinion of a Court of Appeal or a superior court appellate division-whether it affirms or reverses a trial court order or judgment-should be certified for publication in the Official Reports if the opinion:
    (1) Establishes a new rule of law;
    (2) Applies an existing rule of law to a set of facts significantly different from those stated in published opinions;
    (3) Modifies, explains, or criticizes with reasons given, an existing rule of law;
    (4) Advances a new interpretation, clarification, criticism, or construction of a provision of a constitution, statute, ordinance, or court rule;
    (5) Addresses or creates an apparent conflict in the law;
    (6) Involves a legal issue of continuing public interest;
    (7) Makes a significant contribution to legal literature by reviewing either the development of a common law rule or the legislative or judicial history of a provision of a constitution, statute, or other written law;
    (8) Invokes a previously overlooked rule of law, or reaffirms a principle of law not applied in a recently reported decision; or
    (9) Is accompanied by a separate opinion concurring or dissenting on a legal issue, and publication of the majority and separate opinions would make a significant contribution to the development of the law.

    I contend the Court’s well-reasoned Opinion contained therein accordingly satisfy sub-sections 1, 2, 3, 4, 5, 6, and 8 as referenced above more specifically related to Sections I. sub-sections B, C, and D.
    Section I.B. The Opinion clarifies that a homeowner “…has standing to challenge a foreclosure by an unauthorized entity.” Further, the Opinion clarifies that although a superior court may take judicial notice of documents that have been publicly recorded at a county recorder’s office, the “disputed or disputable” factual content of recorded documents is inadmissible hearsay. This meets the standard for publication per CRC, Rules 8.1105(c)(2, 3, 5, 6 and 8).
    Section I.C. The Opinion establishes a new rule on the analysis of a chain-of-title as reflected documents publicly recorded at a county recorder’s office; as well as the analysis of each link in the chain-of-title as to whether a document can establish an unbroken or perfect link in the chain. The Opinion further clarifies that a plaintiff must allege facts that show the defendant who invoked the power of sale was not the true beneficiary. This meets the standard for publication per CRC, Rules 8.1105(c)(1, 2, 4, 6 and 8).
    Section I. D. The Opinion establishes a new rule by distinguishing the two illegal types of wrongful foreclosures: procedural irregularities v. unauthorized foreclosure. This is an important opinion for these cases not previously popularized by other opinions clarifying the question of whether and/or when a homeowner must allege tender and/or prejudice. This meets the standard for publication per CRC, Rules 8.1105(c)(1, 2, 4, 5, 6 and 8).
    Based on the foregoing, I respectfully request this Honorable Court publish the above referenced Opinion.
    Respectfully submitted,

  3. Just a note – there have been millions of wrongful forecloses especially taking into account the massive amount of FANNIE / FREDDIE intentional fraudulent concealment of their roles as “real party in interest.”

  4. Reblogged this on Deadly Clear and commented:
    Like it or not, thank President Trump for the appointment of Justice Neil Gorsuch, a much needed “Rule of Law” judge. Judges in lower courts are more aware that decisions that don’t follow the law and end up in the U.S. Supreme Court have a greater chance of being overturned. BTW – so do the banks.

    COMMON SENSE:
    “In Yvanova, supra, the California Supreme Court inexplicably held that the homeowner can sue for damages for a wrongful foreclosure based upon false instruments and lack of authroity but that the homeowner could not stop the foreclosure itself. Far from being the last word on this subject, the doctrine is leaking badly all over the country. If a homeowner has a right to damages because the foreclosure should never have been conducted, then exactly how could the homeowner be prevented from stopping it in the first place?”

  5. Wall Street won’t care. This case as it sits, is not significant because it is unpublished and cannot be cited.

    The 5th DCA in California is unique in actually considering the law from time to time in its decisions; the other DCAs don’t care about the 5th or the Cal. Supreme Court Either (e.g. Yvanova and Glaski) and rule their way around superior courts’ holdings unabated, ignoring stare decisis as if the doctrine is dead.

    These other courts continue to use presumptions, assumptions and their own corruption and prejudices to justify their rulings. There is a long way to go not only this form of litigation and I suspect Guliex as well, because as has been exhibited time and time again (e.g. Yvanova and Glaski), when remanded, inferior courts constantly find a way to rule around superior court rulings; the rule of law; evidence and facts be damned.

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