JP Morgan Chase Bank v. Lisandros, LLC CA2/8

California Court of Appeal May 9, 2016 No. B260557Unpublished

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Holding. The court held that the trial court properly granted judgment on the pleadings because the bank's recorded rescission of the loan modification agreement rendered the appellant's claims for cancellation and declaratory relief moot. Furthermore, the court found that the loan modification agreement was not a novation, and thus the appellant failed to demonstrate that leave to amend would be anything other than futile.

Issues

Whether the trial court erred in taking judicial notice of a recorded rescission of a loan modification agreement.
Whether the bank's rescission of the loan modification agreement rendered the appellant's claims moot.
Whether the trial court abused its discretion in denying leave to amend the cross-complaint to allege a theory of novation.

Disposition. Affirmed

Quotations verified verbatim against the opinion

“The court held the causes of action for cancellation of instrument and declaratory relief against Chase were no longer viable. The causes of action sought to void the loan modification agreement, and the rescission had in fact voided the agreement.”

“The modification of the second Chase loan affirmed the continuing validity of the loan. It was not a novation that extinguished the previous loan agreement, as Lisandros was urging in opposition to the motion.”

“In short, any attempt to amend the cross-complaint to allege a new cause of action based on novation would have been futile.”

Filed 5/9/16 JP Morgan Chase Bank v. Lisandros, LLC CA2/8 NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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 EIGHT

JP MORGAN CHASE BANK, N.A., B260557

Plaintiff, Cross-defendant and (Los Angeles County Respondent, Super. Ct. No. SC114754)

LISANDROS, LLC,

Defendant, Cross-complainant and Appellant.

APPEAL from a judgment of the Superior Court of Los Angeles County, Craig Karlan, Judge. Affirmed.

Law Office of James E. McDaniel and James E. McDaniel for Defendant, Cross- complainant and Appellant.

Bryan Cave, Christopher L. Dueringer and Richard P. Steelman, Jr., for Plaintiff, Cross-defendant and Respondent. ******

Lisandros, LLC (Lisandros) appeals from the judgment of dismissal entered in favor of JP Morgan Chase Bank, N.A. (Chase). According to Lisandros’s operative pleading, Lisandros purchased a junior lien holder’s stake in real property at a nonjudicial foreclosure sale, subject to Chase’s senior lien position. As we shall explain, Lisandros’s claims against Chase relate to a loan modification agreement between Chase and the homeowner. Chase moved for judgment on the pleadings, and the trial court granted that motion without leave to amend. We affirm. FACTS AND PROCEDURE The operative pleading is Lisandros’s first amended cross-complaint, which alleged as follows. In 1989, Farhad and Linda Tahmassebi purchased the subject property at 659 Kingman Avenue in Santa Monica. (For the sake of clarity, we will refer to the Tahmassebis by their first names when necessary.) Farhad transferred the subject property to Linda as her sole and separate property in 2001. At the same time, Linda obtained a $1 million loan secured by the subject property from Chase (Chase loan).1 For several years after securing the Chase loan, Linda obtained other loans secured by the subject property from various individuals and entities. Linda obtained one of these other loans from Jerald and Kathy Cox in 2003. The Coxes loaned Linda $100,000. Both the Chase loan and the Cox loan were secured by deeds of trust recorded against the subject property. Later, the Coxes reconveyed their deed of trust to Linda, even though she had not fully repaid the Cox loan, so that Linda could borrow $980,000 more from Chase. In 2006, Chase recorded a second deed of trust against the subject property memorializing a loan of $1,980,000 (second Chase loan). After obtaining the second Chase loan, Linda

JP Morgan Chase Bank v. Lisandros, LLC CA2/8

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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION EIGHT

JP MORGAN CHASE BANK, N.A., B260557

LISANDROS, LLC,

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