POONSOOK BRAINANGKUL VS SELECT PORTFOLIO SERVICING, INC.

Tentative Rulings

Case Number: EC065616    Hearing Date: February 14, 2020    Dept: NCD

TENTATIVE RULING

Calendar: 21

Date: 2/14/20

Case No: EC 065616 Trial Date: None Set

Case Name: Brainangkul v. Select Portfolio Servicing, Inc., et al.

MOTION FOR ATTORNEY’S FEES

Moving Party: Plaintiff Poonsook Brainangkul

Responding Party: Defendants Select Portfolio Servicing, Inc. and the

Bank of New York Mellon, as Trustee

RELIEF REQUESTED:

Award of attorneys’ fees in favor of plaintiff and against defendants Select Portfolio Servicing and the Bank of New York Mellon in the sum of $554,485.50.

SUMMARY OF FACTS:

Plaintiff Poonsook Brainangkul alleges that she is the owner of real property in Glendale where she resides as her principal residence. Plaintiff alleges that in July 2015, she submitted a loan modification application to defendant Select Portfolio Servicing, and was approved for a trial period plan, pursuant to which she would make three timely payments and thereafter her loan would be permanently modified. Plaintiff made all three payments, due from October 2015 through December 2015 on time. Plaintiff was provided a permanent modification agreement which she signed and returned to Select Portfolio. Plaintiff made the payments in January and February, which were accepted by Select Portfolio, but the March 2016 payment, received by Select Portfolio was returned, with indication that plaintiff had not returned the permanent loan modification. Plaintiff submitted the tracking number and assured Select Portfolio she had returned a signed permanent modification agreement, but Select Portfolio refused to permanently modify the loan and initiated foreclosure.

Select Portfolio invited plaintiff to submit another loan modification application, and in an effort to save her home, plaintiff submitted the application. Plaintiff alleges that during the second loan modification process, Select Portfolio constantly mishandled her documents, losing some and requesting resubmission, and making inquiry concerning whether submitted paystubs reflected regular or seasonal income, to which plaintiff responded, and then denying the loan modification because plaintiff had not sent in paystubs.

On September 23, 2016, plaintiff spoke with her relationship manager for Select Portfolio, who recommended she appeal the decision. Plaintiff submitted the documents to appeal the decision that day, and on September 26, 2016 the relationship manager confirmed she had received the appeal and would submit it for review.

Plaintiff alleges that she called Select Portfolio or defendant The Wolf Firm every day to check on the status of the appeal, which they informed her was still pending. On October 4, 2016, the Wolf Firm conducted a trustee’s sale, in which the property was sold to Volantis, an experienced foreclosure sale buyer.

The operative complaint alleges that on October 11, 2016, plaintiff’s counsel provided ex parte notice to Volantis of its intent to seek a temporary restraining order enjoining Volantis from recording a TDUS pursuant to plaintiff’s claims against defendants. On October 12, 2016, at 8:30 a.m., plaintiff sought the TRO, but while plaintiff awaited the court to hear the matter, Volantis recorded the TDUS at 8:52 a.m.

The file shows that on February 9, 2018, the court heard a motion for summary judgment, or in the alternative summary adjudication, brought by defendants Select Portfolio Servicing, Inc. and The Bank of New York Mellon. The motion for summary adjudication was granted as to the third cause of action for breach of implied covenant of good faith and fair dealing. The motion was otherwise denied.

On January 17, 2019, the court entered a Judgment on Stipulation submitted by plaintiff Brainangkul and defendants Select Portfolio Servicing and The Bank of New York Mellon, entering judgment in favor of Plaintiff, declaring that plaintiff is the owner and title holder of the subject property, that BONY holds the loan encumbering the property, and that SPS is the servicer of the loan. The judgment provides that once plaintiff’s loan was modified, and the default cured, defendants lacked the power to sell the property under the power of sale in the DOR because there was no default to enforce and set aside the trustee’s sale of October 4, 2016 as void. The judgment states:

“7. The foreclosure sale shall be set aside and Volantis Global shall be entitled to a return of the sale proceeds of $502,000.00, and such other relief as is proper under the Civil Code when a foreclosure sale is set aside.”

This motion was originally scheduled to be heard on April 26, 2019. On that date, the court also heard a motion brought by Volantis Global to vacate the Judgment on Stipulation, arguing the court was not authorized to quiet title as to Volantis and the party to which the property has since been transferred, Half Life, based on the stipulation of plaintiff and the bank defendants, without including Volantis or conducting a properly noticed evidentiary hearing in open court.

The court heard the motion to set aside the judgment and set a non-jury trial on the issue of title and ruled that this attorney fee motion was to be set and heard after the trial was conducted.

The trial was conducted on June 19, 2019, and continued to July 24, 2019, and again to July 26, 2019. The court announced it oral statement of decision, finding that plaintiff prevailed on the quiet title action as to causes of action Nos. 5, 6 and 7 of the Verified Second Amended Complaint, and cross-defendant prevailed as to Volantis’ Second Amended Cross-Complaint for Declaratory Relief and to Quiet Title

On October 23, 2019, the court signed and filed its Judgment on Stipulation, finding that plaintiff owns the property subject to a loan held by BONY and serviced by SPS, the foreclosure sale of October 4, 2016 was void because defendants lacked the power of sale as there was no default on which the sale could be based, so the foreclosure sale was set aside as void. Judgment was entered in favor of plaintiff, with plaintiff and defendants to bear their own costs. The judgment states, “Plaintiff may bring a motion for attorneys’ fees, and Defendants may oppose the motion for attorneys’ fees on any grounds available to them.” [Judgment on Stipulation, p. 5:8-9]. A Notice of Entry of Judgment was filed and served the same date.

On October 28, 2019, plaintiff filed a Notice of Lodging and Reinstating Plaintiff’s Attorney Fee Motion, with a hearing date of December 13, 2019.

On December 4, 2019, the court heard an ex parte application filed on behalf of defendant SPS and the Bank of New York Mellon, at Trustee to continue the hearing on the motion for attorney fees, which was granted, and the motion continued to this date.

On December 23, 2019, Volantis filed a Notice of Appeal giving notice that Volantis appeals from the Judgment on Stipulation entered on October 23, 2019. On December 9, 2019, Volantis filed a Notice of appeal from the adverse judgment from the court trial on Volantis cross-complaint against the plaintiff to quiet title.

RULING:

Plaintiff Poonsook Brainangkul’s Amended Motion for Attorney’s Fees is CONTINUED to October 23, 2020 at 9:00 a.m. as a “place holder” hearing date in light of the pendency of the appeals by Volantis Global Inc. from the Judgment on Stipulation and from the adverse judgment from the court trial on Volantis’ cross-complaint. On October 23, 2020, the court will also conduct a status conference regarding the two appeals. The court will not resolve attorney fee motion now because if Volantis prevails on any of its two appeals, the Motion for Attorneys Fees will either be moot or premature, given the likelihood of more litigation, and the plaintiff losing its status as the prevailing party until a re-trial is concluded. Any re-trial would require the court to make a new determination of the prevailing party, even if plaintiff were to prevail on any such re-trial. Therefore, any determination of plaintiff as the prevailing party at this time before the appeals are resolved could be subject to a de facto nullification if the Court of Appeal were to reverse any one of the two judgments the court entered in favor of the plaintiff. Hence, the court will not proceed at this juncture on plaintiff’s Motion for Attorney’s Fees due to the potential waste of judicial resources even though the court technically has jurisdiction to adjudicate the attorney’s fees motion while the appeals are pending.