Wednesday, April 23, 2014

FYI: Cal App Ct Rejects "Frivolous" Appeal as "Solely for Delay" of Underlying Foreclosure

Saturday, April 21, 2012

The California Court of AppealsSecond Appellate Districtrecently rejected a "frivolous" appeal brought by borrower's counsel involved in a foreclosure action, and referred the matter to the California State Bar for possible discipline of the borrower's attorney. 
 
A copy of the opinion is available at:

Plaintiff-appellant borrower (the "borrower") defaulted on her mortgage loan.  When foreclosure proceedings were initiated, the borrower filed suit to prevent the sale of her home.  The lower court granted a preliminary injunction to stop the trustee sale, on the condition that the borrower deposit $1700 per month into a trust account. 
 
The borrower never made any payments into that account.  Therefore, the foreclosing bank (the "bank") filed an ex parte application to dissolve the preliminary injunction.  The borrower's attorney appeared at the ex parte hearing, represented that his client would make the relevant payments, and argued that the lower court's ruling should not be issued ex parte. 
 
The lower court agreed, and scheduled a hearing date.  At that hearing, the borrower still had not paid anything into the trust account.  Therefore, the lower court dissolved the preliminary injunction, and indicated that the foreclosure sale could go forward. 
 
The borrower appealed, which stopped the trustee sale. 
 
On appeal, the borrower argued that the bank failed to show good cause for ex parte relief, and that the borrower's due process rights were violated.  When the borrower's counsel received calendar notice, he requested that the Court dismiss the appeal. 
 
The Court declined to do so.  Instead, it examined the borrower's counsel's arguments on appeal, terming them "feeble."  It noted that because the lower court's ruling had not been ex parte, the borrower's "premise to the sole contention of the appeal...is false."  Accordingly, the Court rejected the borrower's appeal, and affirmed the ruling of the lower court. 
 
The Court further determined that the borrower's counsel's appeal was "frivolous as a matter of law," and used "solely for delay."  Therefore, the Court ordered that a copy of its opinion be sent to the California State Bar, "for consideration of discipline." 



Eric Tsai
McGinnis Wutscher Beiramee LLP
 
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