Filed 4/25/14; pub. order 5/22/14 (see end of opn.)




              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                  SECOND APPELLATE DISTRICT

                                               DIVISION ONE


TSVETANA YVANOVA,                                       No. B247188
         Plaintiff and Appellant,
                                                        (Los Angeles County
    v.                                                  Super. Ct. No. LC097218)
NEW CENTURY MORTGAGE
CORPORATION et al.,

         Defendants and Respondents.

         APPEAL from an order of the Superior Court of Los Angeles County. Russell
Kussman, Judge. Affirmed.
         Tsvetana Yvanova, in pro. per., for Plaintiff and Appellant.
         Houser & Allison, Robert W. Norman, Jr., Patrick S. Ludeman, for Defendants
and Respondents.




                              ___________________________________
       Plaintiff Tsvetana Yvanova, in pro. per., brought an action against numerous
financial institutions, alleging the mortgage and deed of trust on her residence were
improperly securitized and assigned from the original lender to several successive
mortgagees and trustees, and ultimately improperly sold at foreclosure. Plaintiff alleged
instances of transfer fraud, claimed several assignments were ineffective, and denied that
the ultimate trustee possessed a valid interest in the property. Although the only cause of
the action in the operative complaint was entitled “To Quiet Title,” plaintiff also sought
restitution, damages, and declaratory relief. Defendants demurred to the complaint on the
ground that plaintiff failed to state a cause of action for quiet title in that she failed to
allege she tendered the loan balance. The trial court sustained the demurrer without leave
to amend on that ground.
       We affirm.
                                         Background
Complaint
       Plaintiff’s original and first amended complaints, defendants’ demurrers thereto
and the rulings on those demurrers are not in the record on appeal. We take the facts
from the second amended complaint, which is operative, for now accepting them as true,
and from matters properly subject to judicial notice. The complaint is somewhat difficult
to understand, as it includes plaintiffs’ questions, arguments and evidence, citations to
authority, references to civil pleadings in other jurisdictions, and an unclear timeline.
From a close reading, however, we glean the following facts.
       In 2006, plaintiff executed a promissory note in the amount of $483,000 secured
by a deed of trust on her residence in Woodland Hills, California. The lender and
beneficiary was New Century Mortgage Corporation. The trustee was Stewart Title
Company. The deed of trust entitled the lender to substitute the trustee without notice to
the borrower, assign the note to third parties without notice, and sell the property in case
of default.



                                                2
       According to recorded documents, in August 2008 the trustee served plaintiff with
a notice of default and election to sell, alleging plaintiff was in default on the note in the
amount of $14,711.79. In 2007, when New Century Mortgage was in bankruptcy, the
deed of trust was assigned by means of a Pooling and Servicing Agreement to Deutsche
Bank National Trust Company as trustee for the Morgan Stanley ABS Capital I Inc. Trust
2007-HE1 Mortgage Pass Through Certificates, Series 2007-HE1, a mortgage-backed
security (MBS), i.e., a collection or pool of mortgages packaged together into a security
that is then sold to investors. We will hereafter refer to the security as the Morgan
Stanley MBS.
       In January 2012, Deutsche Bank served plaintiff with a second notice of default
and election to sell, claiming she was in default on the note in the amount of $63,960.80.
In February 2013, Western Progressive, LLC, was substituted in as trustee. In August
2012, Western Progressive executed a notice of trustee’s sale, claiming plaintiff had an
unpaid loan balance in the amount of $537,934.03. On September 14, 2012, Western
Progressive sold the property to THR California, LLC for $355,000.01 and recorded a
trustee’s deed upon sale.
       Plaintiff continues to live in the Woodland Hills residence.
       Plaintiff filed suit on May 14, 2012. After two rounds of demurrer, plaintiff filed
the second amended complaint. The complaint, entitled “Action to Quiet Title,”
contained one cause of action, captioned, “To Quiet Title.” In it, plaintiff made three
substantive allegations: (1) The assignment of the deed of trust to Deutsche Bank was
“ante-dated, misrepresents material facts and entities, that render the instrument void”;
(2) the substitution of Western Progressive as trustee “is void, due to ante dating,
violating procedural trust rules and using entities, which do not have authority to act”;
and (3) Western Progressive “conducted unlawful defective ‘auction’ sale (in violation of
California Secretary of State regulations and Civ Code 1812.6) and subsequently
executed a Trustee’s Deed” that “is invalid, since its validity entirely depends on the
previously recorded security instruments.”

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        Plaintiff alleged the 2006 deed was void due to “Notary fraud, Robo-signed
instruments, misidentification of entities, ante-dating of instruments, misrepresentation of
material fact within the recorded public documents, ‘void ab initio’ Deed of Trust and
Assignment of Deed, due to the use of non-existent business entities, officially out of
business or without authority to act.”
        Plaintiff also alleged the 2011 transfer to Deutsche Bank was invalid because New
Century Mortgage had entered into bankruptcy in August 2008, and the purported
assignment to Deutsche Bank after liquidation was made without the authorization of the
bankruptcy trustee and was irregular in several respects. Although several of the
purported irregularities are specious (for example, plaintiff queries why an entity
incorporated under the laws of one state might list its address in another state), the
essence of plaintiff’s allegations is that recorded documents, without more, do not
establish chain of title running to Deutsche Bank. Ultimately, plaintiff alleged, Deutsche
Bank never possessed the trust deed, and all downstream transfers were therefore void.
She further alleged that transfer of the promissory note in blank from New Century
Mortgage to Morgan Stanley terminated the security interest in her property.
        On February 7, 2012, defendants demurred to the second amended complaint on
the ground that plaintiff failed to state a cause of action for quiet title because she failed
to allege tender to cure her default on the promissory note. Defendants argued plaintiff’s
allegations in the complaint were irrelevant without an allegation of tender, or fraud at
the time the deed of trust was entered into. On February 8, 2013, the trial court sustained
defendants’ demurrer without leave to amend “for the reasons stated in defendants’
moving papers.” The court noted that at the hearing plaintiff represented she had not
attempted to discharge the debt or tender the amount owed, and therefore could not quiet
title in herself.
        Defendants represent that the trial court entered judgment in their favor on
February 8, 2013, but no such judgment has been included in the record on appeal.
Neither does the record contain plaintiff’s notice of appeal.

                                               4
       After an initial round of briefing on appeal we requested further briefing on
whether plaintiff’s allegations might support a cause of action for wrongful foreclosure.
In response, both parties submitted extensive letter briefs, which we have considered.
                                        DISCUSSION
A.     Standard of review
       In reviewing an order sustaining a demurrer without leave to amend, we accept as
true the properly pleaded factual allegations of the complaint. (McCall v. PacifiCare of
California, Inc. (2001) 25 Cal.4th 412, 415.) Where, as here, the complaint references
the terms of a contract, we consider those terms as part of the pleading. Furthermore, the
allegations of the complaint must be liberally construed with a view to attaining
substantial justice among the parties. (Code Civ. Proc., § 452; King v. Central Bank
(1977) 18 Cal.3d 840, 843.) We review the complaint de novo to determine whether the
trial court properly sustained the demurrer. (Cantu v. Resolution Trust Corp. (1992) 4
Cal.App.4th 857, 879.)
B.     Procedural Defects
       Plaintiff’s appeal is defective in several respects. Most immediately, plaintiff has
provided us with no notice of appeal. But as defendants represent that judgment has been
entered and do not complain the appeal is untimely, we will presume the appeal is proper.
       Plaintiff’s submissions on appeal disregard many rules of court. Her opening brief
is improperly formatted and contains no statement of appealability, certificate of
interested parties, table of contents, table of authorities, or certificate of word count.
(Cal. Rules of Court, rules 8.204, subd. (a)(2)(A-B), 8.208, 8.204, subds. (a)–(c).)
Further, plaintiff lodged a four-volume appellant’s appendix, but the appendix contains
no proof of service, and defendants represent they were never served with one, in
violation of court rule 8.124, subdivision (e)(1)(A).
       Plaintiff argues that a trial court may not dismiss a case brought by a litigant in
propria persona, and as such a litigant she need not comply with the court’s rules. She is
incorrect. A party may choose to act as his or her own attorney, but “such a party is to be

                                               5
treated like any other party and is entitled to the same, but no greater consideration than
other litigants and attorneys.” (Barton v. New United Motor Manufacturing (1996) 43
Cal.App.4th 1200, 1210.) As with attorneys, in propria persona litigants must follow
correct rules of procedure. (Nwosu v. Uba (2004) 122 Cal.App.4th 1229, 1246-1247.)
       Defendants request that we disregard plaintiff’s opening brief and appendix.
Although it is within our discretion to do so, we think our request for further briefing
                                                                                       1
clarified the pertinent issues and gave both parties an opportunity to address them.
C.     Substantive Issue
       Plaintiff’s essential allegation is that Deutsche Bank’s receipt of title from New
Century Mortgage’s bankruptcy estate was defective for several specified reasons.
Deutsche Bank therefore had no proper title to her trust deed and no standing to
foreclose. Plaintiff contends this defect permits her to quiet title. Defendants demurred,
and the trial court sustained the demurrer, on the ground that plaintiff’s default and
failure to tender the amount due on her loan deprived her of standing to seek quiet title.
       As defendants argued and the trial court found, plaintiff is not entitled to quiet title
because she failed to allege she tendered funds to discharge her debt. (Aguilar v. Bocci
(1974) 39 Cal.App.3d 475, 477 [a plaintiff may not quiet title in himself without
discharging his debt].) But when evaluating a complaint the court must attend to the facts
properly alleged therein, not the labels appended to them or the theories for recovery.
(Quan v. Truck Ins. Exchange (1998) 67 Cal.App.4th 583, 592.) We construe the
complaint liberally, in attempt to attain substantial justice between the parties. (King v.
Central Bank, supra, 18 Cal.3d at p. 843.)
       In our request for letter briefing we invited the parties to discuss, in essence,
whether plaintiff should be given leave to amend to allege a cause of action for wrongful
foreclosure. Plaintiff responded as follows: “Despite the fact that Plaintiff/Appellant has
presented all facts and factual allegations correctly, to support her claim and additional 4-

       1
           Plaintiff’s request for leave to file a time chart is granted.

                                                 6
5 causes of action—the core facts remain unchanged. However, a leave to amend will
greatly benefit the framing of the case for two reasons: First: New developments in the
economic and legal history since 2012 and new annotated case law supporting the issues
discussed and Second: following the Supplement brief questions, Appellant/Plaintiff will
be able to frame the same issues in a more succinct and focused manner with more
appropriate causes of action.” Defendants, on the other hand, argued amendment would
be futile because plaintiff cannot state a cause of action for declaratory relief or wrongful
foreclosure for the same reasons she may not quiet title in herself: She has no standing to
challenge Deutsch Bank’s claim to title.
       We agree with defendants. “Because a promissory note is a negotiable instrument,
a borrower must anticipate it can and might be transferred to another creditor. As to
plaintiff, an assignment merely substituted one creditor for another, without changing her
obligations under the note.” (Herrera v. Federal National Mortgage Assn. (2012) 205
Cal.App.4th 1495, 1507.) An impropriety in the transfer of a promissory note would
therefore affect only the parties to the transaction, not the borrower. The borrower thus
lacks standing to enforce any agreements relating to such transactions. (Jenkins v.
JPMorgan Chase Bank, N.A. (2013) 216 Cal.App.4th 497, 515 (Jenkins).)
       Plaintiff argues the transfer of her promissory note and deed of trust from New
Century Mortgage to Deutsch Bank and the subsequent securitization of the note were
improper. But even if she is correct, “the relevant parties to such a transaction were the
holders (transferors) of the promissory note and the third party acquirers (transferees) of
the note.” “As an unrelated third party to the alleged securitization, and any other
subsequent transfers of the beneficial interest under the promissory note, [plaintiff] lacks
standing to enforce any agreements, including the investment trust’s pooling and
servicing agreement, relating to such transactions.” (Jenkins, supra, 216 Cal.App.4th at
p. 515.) Plaintiff would not be the victim of such invalid transfers because her
obligations under the note remained unchanged. “Instead, the true victim may be an
individual or entity that believes it has a present beneficial interest in the promissory note

                                              7
and may suffer the unauthorized loss of its interest in the note. It is also possible to
imagine one or many invalid transfers of the promissory note may cause a string of civil
lawsuits between transferors and transferees.” (Ibid.) But plaintiff “may not assume the
theoretical claims of hypothetical transferors and transferees” to assert causes of action
for declaratory relief or wrongful foreclosure. (Ibid.)
       Plaintiff argues Glaski v. Bank of America (2013) 218 Cal.App.4th 1079 supports
her argument that a borrower may challenge a nonjudicial foreclosure based on
allegations that one or more transfers in the chain of title of a trust deed was void. She is
correct. There, after concluding that noncompliance with the terms of a pooling and
servicing agreement would render an assignment void, the court adopted without analysis
the majority rule in Texas that an obligor may resist foreclosure on any ground that
renders an assignment in the chain of title void. (Reinagel v. Deutsche Bank Nat’l Trust
Co. (5th Cir. Tex. 2013) 722 F.3d 700, 705.)
       But no California court has followed Glaski on this point, and many have
pointedly rejected it. (See, e.g., Apostol v. Citimortgage, Inc. (N.D.Cal., Nov. 21, 2013)
2013 U.S.Dist. Lexis 167308, 23-24; Dahnken v. Wells Fargo Bank, N.A., C 13-2838
PJH (N.D.Cal., Nov. 8, 2013) 2013 U.S.Dist. Lexis 160686; In re Sandri (Bankr.
N.D.Cal., Nov. 4, 2013) 2013 Bankr. Lexis 4663.) And as discussed above, Jenkins is
directly to the contrary. We agree with the reasoning in Jenkins, and decline to follow
Glaski.
       Plaintiff alleges nothing unlawful about the foreclosure process beyond the
argument that an allegedly deficient assignment and securitization deprived Deutsche
Bank of an interest in the property. She has no standing to make such a claim.
Therefore, any cause of action for wrongful foreclosure would fail as a matter of law.




                                              8
                                  DISPOSITION
     The judgment is affirmed. Respondents are to receive their costs on appeal.




                                                    CHANEY, J.
We concur:




             ROTHSCHILD, Acting P. J.




             JOHNSON, J.




                                         9
Filed 5/22/14
                           CERTIFIED FOR PUBLICATION

                IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                            SECOND APPELLATE DISTRICT

                                     DIVISION ONE


TSVETANA YVANOVA,                                  No. B247188
        Plaintiff and Appellant,
                                                   (Los Angeles County
   v.                                              Super. Ct. No. LC097218)
NEW CENTURY MORTGAGE
                                                  ORDER CERTIFYING OPINION
CORPORATION et al.,
                                                  FOR PUBLICATION
        Defendants and Respondents.

        THE COURT:
        The opinion filed in the above-entitled matter filed on April 25, 2014, was not
certified for publication in the Official Reports. For good cause it now appears that the
opinion should be published in the Official Reports and it is so ordered.




________________________________________________________________________
ROTHSCHILD, Acting P. J.         CHANEY, J.            JOHNSON, J.
