White & Whitley Group v. Wilson CA1/3

Filed 2/25/16 White & Whitley Group v. Wilson CA1/3 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

FIRST APPELLATE DISTRICT

DIVISION THREE

WHITE & WHITLEY GROUP, LLC, Plaintiff and Respondent, A143030 v. FREDERICK WILSON, (Contra Costa County Super. Ct. No. MSC1301101) Defendant and Appellant.

Appellant Frederick Wilson asserts his consumer debt is void and uncollectable because the original lender’s sale of his promissory note to respondent White & Whitley Group, LLC (White & Whitley) violated the California Finance Lenders Law (Fin. Code § 2200, et seq.).1 The trial court rejected Wilson’s interpretation of the Finance Lenders Law and granted White & Whitley’s motion for judgment on the pleadings. We agree, and therefore affirm the judgment. BACKGROUND Because we are reviewing an order granting a motion for judgment on the pleadings, we assume the truth of the facts alleged in Wilson’s cross-complaint. (People ex rel. Harris v. Pacific Anchor Transp., Inc. (2014) 59 Cal.4th 772, 777 (People ex rel. Harris).) Wilson obtained a consumer loan from CashCall, Inc. (CashCall), a licensed finance lender within the meaning of the Finance Lenders Law. CashCall subsequently sold the debt to White & Whitley for collection.

1 Unless otherwise noted, further statutory citations are to the Financial Code.

1

White & Whitley sued Wilson to collect. Wilson filed a cross-complaint for declaratory relief and damages, alleging violations of the Finance Lenders Law, the Rosenthal Fair Debt Collection Practices Act (Civ. Code § 1788 et seq.), and the federal Fair Debt Collection Practices Act (15 U.S.C. § 1692 et seq.). He alleged the Finance Lenders Law restricts the entities to whom a lender may sell consumer debt to institutional investors or licensed finance lenders. According to the cross-complaint, CashCall’s sale of his debt constituted a willful violation because White & Whitley is neither. As a result, Wilson alleged, the sale rendered his debt void under section 22750, subdivision (b). 2 White & Whitley moved for judgment on the pleadings. The trial court granted the motion without leave to amend. It ruled: “This is a case of first impression concerning the interpretation of Financial Code section 22340(a). The meaning of that section is plain from its legislative history, which clearly shows that Section 22340 (previously Financial Code Section 24476 (AB 346)) merely gave licensees under the Finance Lenders Law express authority to sell real-estate secured loans, without being licensed real estate brokers. [Citation.] [¶] In addition to the legislative history of Section 22340, a provision of the California Code of Regulations appears to indicate quite clearly that Financial Code Section 22340 applies only to real-estate secured loans. See 10 Cal. Code of Regs., title 10, Section 1460. Section 1460 is entitled, ‘Real Estate Secured Loans: Sale to Institutional Investors.’ It provides, in relevant part: ‘Loans made by a finance company under Financial Code Section 22340 and 22600 shall meet all of the following requirements: . . . (b) The finance company shall be the lender or creditor on the promissory note and the beneficiary on the deed of trust securing the loan. . .’ Thus, both the regulation’s title and its description of a Section 22340 loan being secured by a