TIMOTHY L. MCCANDLESS, ESQ.

SBN 147715
1
LAW OFFICES OF TIMOTHY L. MCCANDLESS
2 13240 Amargosa Road
Victorville, California 92392
3
(760) 951-3663 Telephone
4 (909) 382-9956 Facsimile
5
Attorney for Plaintiff,
6 Claudia M. Cardoza

7
SUPERIOR COURT FOR THE STATE OF CALIFORNIA
8
IN AND FOR COUNTY OF LOS ANGELES
9

10 EDWIN LAUS,
CASE NO:
11
Plaintiff, COMPLAINT FOR:
12 MONETARY DAMAGES
V. STATUTORY DAMAGES, PUNITIVE
13
DAMAGES, INJUNCTIVE RELIEF AND
DECLARATORY RELIEF
14 AMERICAN BROKERS CONDUIT;
DEFAULT RESOLUTION NETWORK; 1. VIOLATION OF CALIFORNIA CIVIL
15
FIDELITY NATIONAL TITLE COMPANY, CODE §2923.5;
16 and DOES 1 through 50 inclusive 2. FRAUD;
3. INTENTIONAL
17 Defendants. MISREPRESENTATION;
4. VIOLATION OF CALIFORNIA CIVIL
18 CODE §2923.6;
5. VIOLATION OF CALIFORNIA CIVIL
19 CODE §1572;
6. VIOLATION OF BUSINESS AND
20 PROFESSIONS CODE §17200.
21

22
Plaintiff, CLAUDIA M. CARDOZA, (Hereinafter referred as “Plaintiff”) alleges herein as
23
follows:
24

25

26

27

28 1
COMPLAINT
1

3 GENERAL ALLEGATIONS
4 1. Plaintiff CLAUDIA M. CARDOZA at all times relevant has been a resident of the
5
County of Los Angeles, State of California and the owner of Real Property, including
6
but not limited to the property at issue herein, 6101 Simpson Avenue, North
7
Hollywood, California 91606. The Legal descriptions are as follows:
8

9 APN: 2334-013-845

10 LOT 58 OF TRACT NO. 11466, IN THE CITY OF LOS ANGELES, COUNTY

OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN
11 BOOK 205, PAGE 49 OF MAPS, IN THE OFFICE OF THE COUNTY
12
RECORDER OF SAID COUNTY.

13 2. Defendant THE FIRST DEFENDANT IS ON THE DEED OF TRUST AMERICAN

14 BROKERS CONDUIT, (hereinafter MAKE SURE TO APPREVIATE THE

15
DEFENDANT “AMERICAN BROKERS”) at all times herein mentioned was
16
doing business in the County of Los Angeles, State of California and was the original
17
Lender for Plaintiff’s Deed of Trust Deed and Note.
18

19
3. Defendant THE SECOND DEFENDANT IS ON THE “NOTICE OF DEFAULT”

20 DEFAULT RESOLUTION NETWORK, (hereinafter MAKE SURE TO

21 APPREVIATE THE DEFENDANT “DEFAULT RESOLUTION”) at all times
22
herein mentioned is doing business in the County of Los Angeles, State of California
23
and was listed on the Notice of Default for the above named Real Property.
24
4. Defendant THE THIRD DEFENDANT IS ON THE “NOTICE OF TRUSTEE SALE”
25

26 SOMETIMES IT IS THE SAME DEFENDANT AS THE NOTICE OF DEFAULT, IF

27

28 2
COMPLAINT
 THAT IS THE CASE THE COPY AND PASTE “THE NOTICE OF TRUSTEE
1

2 SALE” AFTER THE WORDS NOTICE OF DEFAULT ABOVE AND DELETE

3 NUMBER FOUR COMPLETELYFIDELITY NATIONAL TITLE COMPANY,

4 (hereinafter IF THE DEFENDANT ON THE “NOTICE OF TRUSTEE SALE”
5
DIFFERS FROM THE DEFENDANT ON THE “NOTICE OF DEFAULT, MAKE
6
SURE TO APPREVIATE THE DEFENDANT “FIDELITY”) at all times herein
7
mentioned is doing business in the County of Los Angeles, State of California and was
8

9 listed on the Notice of Trustee’s Sale for the above named Real Property.

10 5. Plaintiff is ignorant of the true names and capacities of defendants sued herein as
11 DOES 1 through 50, inclusive, and therefore sues these defendants by such fictitious
12
names and all persons unknown claiming any legal or equitable right, title, estate, lien,
13
or interest in the property described in the complaint adverse to plaintiff’s title, or any
14
cloud on Plaintiff’s title thereto. Plaintiff will amend this complaint to allege their true
15

16 names and capacities when ascertained.

17 6. Plaintiff is informed and believes and thereon alleges that, at all times herein
18
mentioned each of the defendants sued herein was the agent and employee of each of
19
the remaining defendants. Plaintiff alleges that each and every defendant alleged herein
20
ratified the conduct of each and every other defendant. Plaintiff further alleges that at
21
all times said defendants were was acting within the purpose and scope of such agency
22

23 and employment.

24 7. Plaintiff purchased the foregoing Real Property and on or about THIS DATE CANE
25
BE FOUND ON THE “DEED OF TRUST” April 18, 2006 and financed his
26
purchase through DEFANDANT ON THE “DEED OF TRUST”AMERICAN
27

28 3
COMPLAINT
 BROKERS CONDUIT by virtue of a Trust Deed and Notes securing the Loans. (See
1

2 Exhibit “A”)

3 8. Plaintiffs further allege that on or about THIS DATE CAN BE FOUND ON THE
4 “NOTICE OF DEFAULT”March 4, 2009, Defendants allege that Plaintiffs became
5
in default of their loan. (See Exhibit “B”) However the Declaration of Due Diligence
6
that is required to be attached to the IS THE DECLARATION MISSING ALL
7
TOGETHER, IF SO, LEAVE THIS WORDING THE SAME, IF NOT, CHANGE
8

9 WORDING TO “INVALID”Notice of Default is missing pursuant to California

10 Civil Code §2923.5, therefore making the Notice of Default void.

11 9. Plaintiffs further allege on information and belief that none of these alleged
12
beneficiaries or representatives on the Notice of Default and/or Notice of Trustee’s
13
Sale can prove that they have the authority to conduct the foreclosure. Furthermore,
14
the Defendants listed on the Notice of Default and/or Notice of Trustee’s Sale were IS
15

16 THERE AN ASSIGNMENT DOCUMENT, IF NOT, LEAVE THE WORDING THE

17 SAME, IF THERE IS AN ASSIGNMENT, DELETE FROM “FURTHERMORE” TO

18
THE END OF THIS PARAGRAPHnever assigned the rights under this Deed of
19
Trust to conduct a valid foreclosure sale.
20
10. Plaintiffs further allege that the foreclosure sale of the Subject Property due to the
21
failed notices and unauthorized parties was not executed in accordance with the
22

23 requirements of California Civil Code §2924, §2923.5 and §2923.6.

24 11. Plaintiff alleges that Defendants, and each of them, are engaged in and continue to
25
engage in violations of California law including but, not limited to: California Civil
26
Code §2924, §2923.5 and §2923.6, and unless restrained will continue to engage in
27

28 4
COMPLAINT
 such misconduct, and that a public benefit necessitates that Defendants be restrained
1

2 from such conduct in the future.

3 I.
4 FIRST CAUSE OF ACTION
VIOLATION OF CALIFORNIA CIVIL CODE §2923.5
5 (Against all Defendants)
6

7 12. Plaintiff repeats and reallege Paragraphs 1 through 11 as though fully set forth

8 herein.
9 13. Defendants cannot prove that the nonjudicial foreclosure which has commenced,
10
strictly complied with the tenets of California Civil Code §2923.5 and §2924 in order
11
to maintain an action for possession.
12
14. The California Legislature passed Senate Bill 1137, impacting residential mortgage
13

14 lenders, foreclosure procedures and eviction procedures. This law is effective

15 immediately and extends on to January 1, 2013. The Statute amends provisions of the
16 non-judicial foreclosure procedures found in California Code of Civil Procedure
17
§2924, by adding requirements for meetings, due diligence, and notification of
18
counseling. The primary purpose for the Statute is foreclosure procedures and imposes
19
an unprecedented duty upon lenders relating to contact with borrowers.
20

21 California Civil Code §2923.5

22 15. As of IS THE NOTICE OF DEFAULT DATE BEFORE THIS DATE, IF SO, TAKE
23 FILE TO MONA FOR FURTHER ASSISTANCE WITH THE
24
COMPLAINTSeptember 6, 2008, California Civil Code §2923.5 applies to loans
25
made from January 1, 2003, to December 31, 2007, and loans secured by residential
26
real property that are for owner-occupied residences. For purposes of California Civil
27

28 5
COMPLAINT
 Code §2923.5, “owner-occupied” means that the residence is the principal residence of
1

2 the borrower. Prior to filing a Notice of Default, California Civil Code §2923.5

3 provides in pertinent part:

4 (a) (1) A trustee may not file a notice of default pursuant to Section 2924 until 30
5
days after contact is made as required by paragraph (2) or 30 days after
satisfying the due diligence requirements as described in subdivision (g). In
6 either case, the borrower shall be provided the toll-free telephone number
made available by the United States Department of Housing and Urban
7 Development (HUD) to find a HUD-certified housing counseling agency. Any
meeting may occur telephonically.
8
(2) An authorized agent shall contact the borrower in person or by telephone in
9 order to assess the borrower’s financial situation and explore options for the
borrower to avoid foreclosure. During the initial contact, the mortgagee,
10 beneficiary, or authorized agent shall advise the borrower that he or she has
the right to request a subsequent meeting and, if requested, the mortgagee,
11
beneficiary, or authorized agent shall schedule the meeting to occur within 14
12 days.
Lender in this case did not provide a toll-free telephone number to Plaintiff. Plaintiff
13
was never contacted to assess their financial situation and was not given any options
14

15
in order to avoid foreclosure. Plaintiff would have requested a meeting at their home

16 within 14 days if they had been advised of that option.

17
(b) A notice of default filed pursuant to Section 2924 shall include a declaration
18
from the mortgagee, beneficiary, or authorized agent that it has contacted the
19 borrower, tried with due diligence to contact the borrower as required by this
section, or the borrower has surrendered the property to the mortgagee,
20 trustee, beneficiary, or authorized agent.
The required declaration is missing/improper. THERE IS NORMALLY NEVER A
21

22
PENALTY OF PERJURY, IN THE CASE THAT THERE IS, STOP AND ASK

23 BERNIE OR MONA OTHERWISE UNHIGHLIGHTThe declaration does not

24 contain a penalty of perjury clause and there is no evidence on the face of the Notice
25
of Default as to whether the declarant had any personal knowledge concerning any
26
contact made to Plaintiff. (See infra)
27

28 6
COMPLAINT
1 (c) If a mortgagee, trustee, beneficiary, or authorized agent had already filed the
2
notice of default prior to the enactment of this section and did not subsequently
file a notice of rescission, then the mortgagee, trustee, beneficiary, or
3 authorized agent shall, as
part of the notice of sale filed pursuant to Section 2924f, include a declaration
4 that
either:
5
(1) States that the borrower was contacted to assess the borrower's financial
6 situation and to explore options for the borrower to avoid foreclosure.
(2) Lists the efforts made, if any, to contact the borrower in the
7 event no contact was made.
8
16. Furthermore California Civil Code §2923.5(g) provides that a borrower not contacted
9
by a mortgagee, beneficiary, or authorized agent despite “due diligence” shall mean all
10
of the following:
11

12
(1) A mortgagee, beneficiary, or authorized agent shall first attempt to contact
a borrower by sending a first-class letter that includes the toll-free telephone
13 number made available by HUD to find a HUD-certified housing counseling
agency.
14
(2) (A) After the letter has been sent, the mortgagee, beneficiary, or
15
authorized agent shall attempt to contact the borrower by telephone at least
16 three times at different hours and on different days. Telephone calls shall be
made to the primary telephone number on file.
17 (B) A mortgagee, beneficiary, or authorized agent may attempt to contact
a borrower using an automated system to dial borrowers, provided that, if the
18
telephone call is answered, the call is connected to a live representative of the
19 mortgagee, beneficiary, or authorized agent.
(C) A mortgagee, beneficiary, or authorized agent satisfies the telephone
20 contact requirements of this paragraph if it determines, after attempting contact
pursuant to this paragraph, that the borrower's primary telephone number and
21 secondary telephone number or numbers on file, if any, have been
22
disconnected.

23 (3) If the borrower does not respond within two weeks after the telephone call
requirements of paragraph (2) have been satisfied, the mortgagee, beneficiary,
24 or authorized agent shall then send a certified letter, with return receipt
requested.
25

26 (4) The mortgagee, beneficiary, or authorized agent shall provide a means

for the borrower to contact it in a timely manner, including a toll-free telephone
27

28 7
COMPLAINT
 number that will provide access to a live representative during business hours.
1

2
The mortgagee, beneficiary, or authorized agent never complied with the provisions
3
of §2923.5(g) of California Civil Code in its entirety as proscribed.
4

5
17.Plaintiff is informed and believes and thereupon alleges that the Notice of Default was
6
invalid and unenforceable due to the intentional and willful violations including but,
7

8
not limited to failing and/or refusing to mail the Notice of Default within ten business

9 days to Plaintiffs, to post and mail the Notice of Default within one month, to properly

10 set the sale date, to publish the Notice of Sale twenty days prior to the date set for sale,
11
and to record the Notice of Sale as required by California Civil Code §2924.
12
18. Defendants did not fully comply with California Civil Code §2923.5 and therefore the
13
Notice of Default is VOID. Thus if the property is sold in a nonjudicial foreclosure,
14

15
the procedure is void.

16

17 Invalid Declaration on Notice of Default and/or Notice of Trustee’s Sale

18
PENALTY OF PERJURY
19
19. The purpose of permitting a declaration under penalty of perjury, in lieu of a sworn
20
statement, is to help ensure that declarations contain a truthful factual representation
21

22
and are made in good faith. (In re Marriage of Reese & Guy, 73 Cal. App. 4th 1214, 87

23 Cal. Rptr. 2d 339 (4th Dist. 1999).

24 20. In addition to California Civil Code §2923.5, California Code of Civil Procedure
25
§2015.5 states:
26

27

28 8
COMPLAINT
 Whenever, under any law of this state or under any rule, regulation, order or
1
requirement made pursuant to the law of this state, any matter is required or
2 permitted to be supported, evidenced, established, or proved by the sworn
statement, declaration, verification, certificate, oath, or affidavit, in writing of
3 the person making the same, such matter may with like force and effect be
supported, evidenced, established or proved by the unsworn statement,
4
declaration, verification, or certificate, in writing of such person which recites
5 that is certified or declared by him or her to be true under penalty of
perjury, is subscribed by him or her, and (1), if executed within this state,
6 states the date and place of execution; (2) if executed at any place, within or
without this state, states the date of execution and that is so certified or
7 declared under the laws of the State of California. The certification or
8
declaration must be in substantially the following form:
(a) If executed within this state:
9 “I certify (or declare) under penalty of perjury that the foregoing is true and
correct”:
10 __________________ _______________________
(Date and Place) (Signature)
11

12
For our purposes we need not look any farther than the Notice of Default to
13
find the IF THE DECLARATION IS NOT ATTACHED TO THE “NOTICE OF
14

15
DEFAULT” LEAVE THE WORDING THE SAME, IF IT IS, REPLACE THE

16 WORD “MISSING” WITH “INVALID” BECAUSE THE DECLARATION IS

17 ALWAYS INVALIDdeclaration is missing and therefore there is no signature
18
under penalty of perjury; as mandated by new Civil Code §2923.5(c). Therefore,
19
the Notice of Default is VOID.
20

21

22
LACK OF PERSONAL KNOWLEDGE OF DECLARANT

23 1. An affidavit on behalf of a corporation must show that it was made by an authorized

24 officer or agent, and the officer him or herself must swear to the facts. Furthermore, a
25
person who verified a pleading is required to have personal knowledge or reasonable
26
cause to believe the existence of the facts stated therein. Here, the Declaration for the
27

28 9
COMPLAINT
 Notice of Default by the agent does not state if the agent has personal knowledge and
1

2 how he obtained this knowledge.

3 2. The proper function of an affidavit is to state facts, not conclusions, and affidavits that
4 merely state conclusions rather than facts are insufficient. An affidavit must set forth
5
facts and show affirmatively how the affiant obtained personal knowledge of those
6
facts. The Notice of Default does not have the required agent’s personal knowledge of
7
facts and if the Plaintiff borrower was affirmatively contacted in person or by
8

9 telephone to assess the Plaintiff’s financial situation and explore options for the

10 Plaintiff to avoid foreclosure. Simply put, the declaration was missing all together.
11 3. Plaintiff alleges that Defendants, and each of them, willfully, wrongfully and without
12
justification, and without privilege commenced an invalid foreclosure sale against the
13
Plaintiff’s SUBJECT PROPERTY, thereby, slandering Plaintiff’s title thereto.
14
4. Furthermore, The California Foreclosure Prevention Act, which became effective June
15

16 15, 2009, delays the non-judicial foreclosure process by requiring an addition 90-day

17 delay (beyond the current three-month period) between recording a notice of default
18
and a notice of stay for certain residential properties. The law applies to:
19
1. Loans recorded between January 1, 2003 and January 1, 2008, inclusive,
20 2. The borrower occupies the property as his/her principal residence and occupied it
at the time the loan became delinquent;
21 3. A notice of default has been recorded on the property; and
4. The loan is secured by a first lien on residential property that is located in
22
California.
23
5. In this case, Plaintiff’s property was his principal place of residence and his deed was
24
dated on THIS DATE CANE BE FOUND ON THE “DEED OF TRUST”April 18,
25

26 2006. Therefore, the California Foreclosure Prevention Action applies and they should

27

28 10
COMPLAINT
 be allowed an additional 90 days (plus the three-month period already) after Notice of
1

2 Default is recorded. Therefore, the Notice of Trustee’s Sale recorded on THIS DATE

3 CAN BE FOUND ON THE NOTICE OF TRUSTEE SALE, WHEN IS THE SALE

4 GOING TO OCCUR? June 5, 2009 is also void.
5

6 II.
SECOND CAUSE OF ACTION
7 FOR FRAUD
(Against all Defendants)
8

9
6. Plaintiff repeats and realleges Paragraphs 1 through 25 as though fully set forth
10
herein.
11

12
7. On or about THIS DATE CANE BE FOUND ON THE “DEED OF TRUST”àMarch

13 18, 2006, Plaintiff obtained a loan through DEFANDANT ON THE “DEED OF

14 TRUST”AMERICAN BROKERS to finance her home. (See Exhibit “A”). On or

15
about THIS DATE CAN BE FOUND ON THE “NOTICE OF DEFAULT” March 4,
16
2009, DEFENDANT ON THE “NOTICE OF DEFAULT”DEFAULT
17
RESOLUTION and FIDELITY purported to execute a Notice of Default.
18

19
8. Plaintiffs have recently learned that Defendants DEFENDANT ON THE “NOTICE OF

20 DEFAULTӈDEFAULT RESOLUTION and FIDELITY listed on the Notice of

21 Default and Notice of Trustee’s Sale are not the legal owners of the Note and Deed of
22
Trust and were not at the time they will issue the notices and commenced the
23
foreclosure process, notwithstanding the fact that the note was not negotiable and did
24
not contain a valid power of sale and also was void due to the missing/invalid
25

26 Declaration of Due Diligence.

27

28 11
COMPLAINT
 9. The Note executed by Plaintiff was no longer a negotiable instrument because the
1

2 assignment was not physically applied to the Note pursuant to the holding of Pribus v.

3 Bush, (1981) 118 Cal.App.3d 1003, 173 Cal.Rptr. 747, although there was sufficient
4 room on the back of the Note to complete the assignment, and as such the foreclosure
5
of Plaintiff’s subject property was void.
6
10. In addition, California Civil Code §2932.5 governs the Power of sale under an assigned
7
mortgage, and provides that the power of sale can only vest in a person entitled to
8

9 money payments:

10 "Where a power to sell real property is given to a mortgagee, or other encumbrancer, in

11 an instrument intended to secure the payment of money, the power is part of the
12
security and vests in any person who by assignment becomes entitled to payment of
13
the money secured by the instrument. The power of sale may be exercised by the
14
assignee if the assignment is duly acknowledged and recorded.”
15

16 11. Defendants have no standing to enforce a non-judicial foreclosure. Defendants are

17 strangers to this transaction, and have no authority to go forward with the foreclosure
18
and Trustee's Sale because an assignment was not acknowledge or recorded.
19
12. Uniform Commercial Code §3-301 states that the “person entitled to enforce an
20
instrument” is either the holder of the instrument or a nonholder in possession of the
21
instrument who has the rights of a holder. Furthermore, §3-302 states that a “holder in
22

23 due course” is not a person who acquired rights of an instrument by legal process or by

24 purchase in an execution, bankruptcy, or creditor’s sale or similar proceedings.

25
13. Plaintiff executed a Promissory Note (hereinafter the “Note”) and a Deed of Trust to
26
DEFANDANT ON THE “DEED OF TRUST”àAMERICAN BROKERS. (See Exhibit
27

28 12
COMPLAINT
 “A”). DEFANDANT ON THE “DEED OF TRUST”AMERICAN BROKERS is the
1

2 Lender and only party entitled to enforce the Note and any security interest with it.

3 14. DEFENDANT ON THE “NOTICE OF DEFAULT”àDEFAULT RESOLUTION

4 NETWORK and FIDELITY is not listed anywhere in the Deed of Trust or Promissory
5
Note. (See Exhibit “A”)
6
15. The Los Angeles County Recorder's Office does not contain any evidence of a
7
recorded assignment from DEFANDANT ON THE “DEED OF
8

9 TRUST”AMERICAN BROKERS.

10 16. As a result, the power of sale may not be exercised by any of the Defendants since
11 there was never an acknowledged and recorded assignment pursuant to California
12
Civil Code §2932.5. Furthermore, Defendants DEFENDANT ON THE “NOTICE OF
13
DEFAULT”DEFAULT RESOLUTION and FIDELITY have no lawful security
14
interest in the subject property.
15

16 17. Plaintiffs allege that Defendants, and each of them, falsely misrepresented that the

17 Notice of Default was validly executed, that they intended to induce Plaintiffs into
18
relying on the misrepresentation, that they knew at the time they made these
19
representations to Plaintiffs that they were untrue, and defendants know at the time that
20
they were attempting to foreclose on Plaintiffs’ Trust Deeds and notes that they had no
21
right to do so.
22

23 18. Plaintiffs allege that due to their reliance on Defendants representations he has been

24 damaged in an amount that currently exceeds $25,000.00 and additionally costs of

25
moving out of Plaintiffs’ property and the costs to relocate back to the subject Property.
26
19. Plaintiffs allege Defendants DEFENDANT ON THE “NOTICE OF
27

28 13
COMPLAINT
 DEFAULT”DEFAULT RESOLUTIONS and FIDELITY intentionally and
1

2 fraudulently converted Plaintiffs’ right, title and interest to his property, and any equity

3 therein. Defendants willful deceit was with intent to induce Plaintiff into believing
4 they had authority to start the foreclosure process by recording a false document. (See
5
infra)
6
20. Defendants’ conduct as set forth above was intentional, oppressive fraudulent and
7
malicious so as to justify an award of punitive damages in an amount sufficient that
8

9 such conduct will not be repeated.

10 Recording a False Document

11 21. The Notice of Default states, “That by reason thereof, the present beneficiary under
12
such deed of trust, has executed and delivered to said agent, a written Declaration of
Default and Demand for same, and has deposited with said agent such Deed of Trust
13 and all documents evidencing obligations secured thereby”

14 However, Defendants do not have the original promissory note, nor do they provide
15
any documents evidencing obligations secured thereby.
16

17
22. Furthermore, according to California Penal Code §115 in pertinent part:
18

19
(a) Every person who knowingly procures or offers any false or forged instrument
to be filed, registered, or recorded in any public office within this state, which
20 instrument, if genuine, might be filed, registered, or recorded under any law of this
state or of the United States, is guilty of a felony.
21 (b) Each instrument which is procured or offered to be filed, registered, or recorded
in violation of subdivision (a) shall constitute a separate violation of this section.
22

23 In addition, California Evidence Code §669 states in pertinent part:

24 (a) The failure of a person to exercise due care is presumed if:

(1) He violated a statute, ordinance, or regulation of a public entity;
25

26

27

28 14
COMPLAINT
 Here, as stated above the Declaration of Due Diligence as required by Section
1

2 2923.5 of the California Civil Code is missing and/or improper for the Notice of

3 Default. Therefore, Defendants DEFANDANT ON THE “DEED OF

4 TRUSTӈAMERICAN BROKERS, are guilty of a felony for recording the Notice of
5
Default with a false instrument according to California Penal Code §115. Since
6
Defendants have violated a statute, the failure of them to exercise due care will be
7
presumed.
8

9 23. Furthermore, This defendant did not adhere to the mandates laid out by congress

10 before a foreclosure can be considered duly perfected. The Notice of Default states:
11
“That by reason thereof, the present beneficiary under such deed of trust, has
12
executed and delivered to said agent, a written Declaration of Default and
Demand for same, and has deposited with said agent such Deed of Trust
13 and all documents evidencing obligations secured thereby, and has
declared and does hereby declare all sums secured thereby immediately due
14 and payable and has elected and does hereby elect to cause the trust property
15
to be sold to satisfy the obligations secured thereby.”

16 However, Defendants do not have the Deed of Trust, nor do they provide any

17 documents evidencing obligations secured thereby. For the aforementioned reasons, the
18
Notice of Default will be void as a matter of law and Defendants recorded a false
19
document.
20

21

22
III.
THIRD CAUSE OF ACTION
23
FOR INTENTIONAL MISREPRESENTATION
24
(Against all Defendants)

25
24. Plaintiffs repeat and realleges Paragraphs 1 through 43 as though fully set forth herein.
26
25. Plaintiffs are informed and believe that the representation on the Deed of Trust and
27

28 15
COMPLAINT
 Notice of Default was a false intentional representation in the following particulars:
1

2 [A] Defendant DEFANDANT ON THE “DEED OF TRUST”AMERICAN

3 BROKERS knew Defendants DEFENDANT ON THE “NOTICE OF

4 DEFAULT”DEFAULT RESOLUTION and FIDELITY were not authorized to
5
commence the foreclosure process by executing a Notice of Default and it was made
6
for the sole purpose of inducing reliance and confusing Plaintiffs.
7
[B] At the time Defendants DEFENDANT ON THE “NOTICE OF
8

9 DEFAULT”DEFAULT RESOLUTION and FIDELITY executed the Notice of

10 Default they knew the required Declaration of Due Diligence was false and for the
11 sole purpose of inducing reliance and confusing Plaintiffs. Defendants also recorded a
12
document they knew was false.
13
[C] DEFENDANT ON THE “NOTICE OF DEFAULT”DEFAULT
14
RESOLUTION and FIDELITY were not entitled to the payments and authorized to
15

16 start the foreclosure process since there IF THERE WAS NO ASSIGNMENT

17 LEAVE THE SAME, IF THERE IS AN ASSIGNMENT, CHECK TO SEE IF WAS

18
DIRECTLY FROM THE “LENDER” ON THE “DEED OF TRUST”was never a
19
recorded assignment from DEFANDANT ON THE “DEED OF
20
TRUST”AMERICAN BROKERS.
21

22

23

24

25 IV.

26 FOURTH CAUSE OF ACTION

VIOLATION OF CALIFORNIA CIVIL CODE §2923.6
27

28 16
COMPLAINT
 (As Against All Defendants)
1

2
26. Plaintiffs reallege and incorporate by reference the above paragraphs 1 through 45 as
3
though set forth fully herein.
4
27. Defendants’ Pooling and Servicing Agreement (hereinafter “PSA”) contains a duty to
5

6
maximize net present value to its investors and related parties.

7 28. California Civil Code §2923.6 broadens and extends this PSA duty by providing that

8 the mortgagee, beneficiary, or authorized agent offer the borrower a loan modification
9
or workout plan if such a modification or plan is consistent with its contractual or other
10
authority.
11
29. Pursuant to California Civil Code §2923.6(a), a servicer acts in the best interest of all
12

13
parties if it agrees to or implements a loan modification where the (1) loan is in

14 payment default, and (2) anticipated recovery under the loan modification or workout
15 plan exceeds the anticipated recovery through foreclosure on a net present value basis.
16
30. Plaintiffs’ loan is presently in an uncertain state and The Joint Economic Committee of
17
Congress estimated in June 2007 that the average foreclosure results in $77, 935.00 in
18
costs to the homeowner, lender, local government, and neighbors.
19

20
31. Of the $77,935.00 in foreclosure costs, the Joint Economic Committee of Congress

21 estimates that the lender will suffer $50,000.00 in costs in conducting a non-judicial
22 foreclosure on the property, maintaining, rehabilitating, insuring, and reselling the
23
property to a third party. Freddie Mac places this loss higher at $58,759.00.
24
32. Plaintiffs are willing, able, and ready to execute a modification of their loan on a
25
reasonable basis GO TO GOOGLE, SEARCH “ZILLOW” ENTER ADRESS,
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28 17
COMPLAINT
 GET THE “ZILOMATE” TAKE 10% OFF THE TOP, GOOGLE
1

2 “MORTGAGE CALCULATE” GO TO THE FIRST LINK “BANKRATE”

3 ENTER THE AMOUNT WITH THE 10% OFF THE TOP WITH A 4%
4 INTEREST RATE AND THEN CALCULATE AND FILL IN
5
(a) New Loan Amount (Fair Market Value – 10%): $526,050.00
6
(b) New Interest Rate: 4%
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(c) New Loan Length: 30 years
8
(d) New Payment: $2,418.42
9

10
33. The present fair market value of the property is $584,500.00.
11
34. Pursuant to California Civil Code §2823.6, Plaintiffs invoke the remedies embodied in
12
the aforementioned agreement and/or codes with a willingness to execute a
13

14 modification of their loan. This option was not explored with the Plaintiffs.

15 35. Furthermore, according to Anthony E. Dimock v. Emerald Properties, LLC. et al. (81
16 Cal.App.4th 868, 97 Cal.Rptr.2d 255), Plaintiff was not required to rely upon equity in
17
attacking the deed and therefore he was not required to meet any of the burdens
18
imposed when, as a matter of equity, a party wishes to set aside a voidable deed. (See
19
Little v. CFS Service Corp., supra, 188 Cal.App.3d at p. 1359.) In particular, Plaintiff
20

21 is not required to tender any of the amounts due under the note.

22 36. Also in Scott v. Security Title Ins. & Guar. Co. (1937) 9 Cal.2d 606, 610-611, the court
23
stated that “It is true that if the sale had been totally void their tender obligation would
24
have been excused.” A “void sale” according to 12 Thompson on Real Estate, Thomas
25
Editions §101.0(c)(2)(i) can be set aside even though the property passed into the
26
hands of a bona fide purchaser. Furthermore, the section states that most of the cases
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COMPLAINT
 in which a sale to a bona fide purchaser was set aside involved sales by trustees or
1

2 mortgagees who lacked the power to sell.

3 37. Plaintiffs are suing for a legal remedy and therefore, there is no requirement of tender.
4 In addition the lack of power of sale rendered the sale void which would excuse
5
Plaintiff’s tender obligation.
6
V.
7
FIFTH CAUSE OF ACTION
8 VIOLATION OF CALIFORNIA CIVIL CODE §1572
(As to All Defendants)
9

10 38. Plaintiff realleges and incorporates by reference the above paragraphs 1 through 57 as
11
though set forth fully herein.
12
39. Plaintiff is an unsophisticated customer whose reliance upon Defendants was
13
reasonable and consistent with the Congressional intent and purpose of California
14

15 Civil Code §1572 enacted in 1872 and designed to assist and protect consumers

16 similarly situated as Plaintiff in this action.

17 40. Defendants’ misrepresentations, failures to disclose, and failure to assign as described
18
above were made with the intent to induce Plaintiff to obligate himself in reliance on
19
the integrity of Defendants and/or Defendants’ predecessors.
20
41. As an unsophisticated customer, Plaintiffs could not have discovered the true nature of
21

22 the material facts on their own.

23 42. Plaintiff was ignorant of the facts which Defendants misrepresented and failed to
24 disclose and their reliance was a substantial factor in causing their harm.
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43. As a proximate result of Defendants, Plaintiff has suffered damage in an amount to be
26
determined at trial.
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COMPLAINT
 44. The conduct of Defendants as mentioned above was fraudulent within the meaning of
1

2 California Civil Code §3294(c)(3), and by virtue thereof Plaintiff is entitled to an

3 award of punitive damages in an amount sufficient to punish and make an example of

4 the Defendants.
5
VI.
6
SIXTH CAUSE OF ACTION
7 VIOLATION OF BUSINESS AND PROFESSIONS CODE §17200
(As Against All Defendants)
8

9 45. Plaintiffs reallege and incorporate by reference the allegations of paragraphs 1 through
10 64, inclusive, as though set forth fully herein.
11
46. Plaintiffs allege that Defendants’ practices are likely to mislead the general public, and
12
therefore, constitute a fraudulent business act of practice within the meaning of
13
Business and Professions Code §17200. The Defendants’ unfair, unlawful, and
14

15 fraudulent business practices and false and misleading declaration on the Notice of

16 Default present a continuing threat to members of public in that other consumers will
17 be defrauded into assuming this void Notice of Default is in fact valid. Plaintiffs and
18
other members of the general public have no other adequate remedy of law.
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47. Plaintiffs allege that the employees and/or agents of DEFENDANT ON THE
20
“NOTICE OF DEFAULT”àDEFAULT RESOLUTION and FIDELITY represented
21

22 that said employees and/or agents had contacted Plaintiff to assess his situation.

23 Defendants recorded a false document known as the Notice of Default with an invalid
24 Declaration. Furthermore, there was IF THE ASSIGNMENT WAS NOT DIRECTLY
25
FROM THE “LENDER” ON THE “DEED OF TRUST” IT IS INVALID,
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THEREFORE LEAVE THE WORDING THE SAMEnever an assignment from
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COMPLAINT
 DEFENDANT ON THE “NOTICE OF DEFAULT”AMERICAN BROKERS to
1

2 DEFAULT RESOLUTION. Therefore, the Notice of Default is VOID as a matter of

3 law.
4 48. The harm to Plaintiffs and to members of the general public outweighs the utility of
5
Defendants’ policy and practices, consequently, constitute an unlawful business act of
6
practice within the meaning of Business and Professions Code §17200.
7
49. As a result of the aforementioned acts, Plaintiffs have lost money or property and
8

9 suffered injury in fact. Defendants received and continue to hold Plaintiffs’ money and

10 other members of the public who fell victim to Defendants’ scheme.

11

12 The aforementioned acts of Defendants, and each of them, were motivated by

13
oppression, fraud, malice in that Defendants, and each of them, by their respective acts,
14
omissions, nonfeasance, misfeasance and/or malfeasance executed an invalid
15
foreclosure sale of the Plaintiff’s Subject Property, in order to deny Plaintiff of his
16

17
rights of possession and ownership, whereupon, the Foreclosure was defective as

18 discussed above due to the VOID Notice of Default and as such the Property must be

19 restored to Plaintiff or alternatively Plaintiff is entitled to the value of thereof.

20

21
WHEREFORE, Plaintiffs having set forth the claims for relief against Defendants,
22
respectfully pray that this Court grant the following relief against the Defendants:
23

24
1. Actual Economic and Non-Economic Damages;

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COMPLAINT
 2. For a declaration of the rights and duties of the parties relative to Plaintiff’s Home
1

2 to determine the actual status and validity of the loan, Deed of Trust, and Notice of

3 Default.
4 3. For a preliminary injunction and permanent injunction enjoining all Defendants,
5
their agents, assigns, and all person acting under, for, or in concert with them, from
6
foreclosing on Plaintiff’s Home or from conducting a trustee’s sale or causing a trustee’s
7
sale to be conducted relative to Plaintiff’s Home;
8

9 4. Cancellation of the sale and restitution of the home to the Plaintiffs;

10 5. For damages as provided by statute;

11 6. For an Order enjoining Defendants from continuing to violate the statutes alleged
12
herein;
13
7. For an Order, requiring Defendant to reinstate Plaintiff on title to his Property, and
14
or a restraining order preventing Defendants and his, hers, or its agents, employees,
15

16 officers, attorneys, and representatives from engaging in or performing any of the

17 following acts: (i) offering, or advertising this property for sale and (ii) attempting to
18
transfer title to this property and or (iii) holding any auction therefore;
19
8. For punitive damages;
20
9. Costs and reasonable attorney’s fees pursuant to California Civil Code §1717,
21
§1788.30(b), §1788.30(c);
22

23 10. For such other and further relief as the court may deem just and proper.

24

25 Dated: September 8, 2009 LAW OFFICES OF TIMOTHY MCCANDLESS

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__________________________________________
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COMPLAINT
 Timothy L. McCandless, Esq.,
1
Attorney for Plaintiff,
2
Claudia M. Cardoza

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COMPLAINT
 VERIFICATION
1

2
I, TIMOTHY L. MCCANDLESS, am an attorney at law admitted to practice before all courts of

3 the State of California and have my office in San Bernardino County, California, and am the
4 attorney for the Plaintiff in this action, that all of the officers of the Plaintiff are unable to make the
5
verification because they are absent from said County and for that reason affiant makes this
6
verification on the Plaintiff’s behalf; that I have read the foregoing document and know its
7
contents. I am informed and believe and on that ground allege that matters stated herein are true.
8

9
Executed September 8, 2009, at Victorville, California.

10 I declare under penalty of perjury that under the laws of the State of California that the foregoing
11 is true and correct.
12
DATED: September 8, 2009
13
___________________________________
14 TIMOTHY L. McCANDLESS,

15 ESQ.
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COMPLAINT