Filed 8/17/20 Bistline v. Federal Home Loan etc. CA2/3
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for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 THREE

 KRISTINE ANN BISTLINE,                                              B293389

          Plaintiff and Appellant,                                   (Los Angeles County
                                                                     Super. Ct. No. MC027909)
          v.

 FEDERAL HOME LOAN MORTGAGE
 CORPORATION, et al.

          Defendants and Respondents.



      APPEAL from a judgment of the Superior Court of Los
Angeles County, Randolph Rogers, Judge. Dismissed in part,
reversed in part and remanded.
      Law Office of Richard L. Antognini and Richard L.
Antognini; Law Offices of Andrew Jay Kulick and Andrew Jay
Kulick for Plaintiff and Appellant.
     Wolfe & Wyman and Kelly Andrew Beall for Defendants
and Respondents.
                 _________________________

       Plaintiff and appellant Kristine Ann Bistline (Bistline)
appeals a judgment dismissing her action against defendants and
respondents Federal Home Loan Mortgage Corporation (FHLMC)
and Ditech Financial, LLC (Ditech) (collectively, Defendants)
pursuant to the grant of their motion to dismiss or stay her action
for forum non conveniens.
       The trial court dismissed the action on the ground that “the
instant litigation is barred by res judicata, pursuant to the entry
of dismissal with prejudice” of a case that Bistline had brought in
federal court. However, Defendants had not sought dismissal of
the instant case on the basis of res judicata—their motion urged
that a suitable alternative forum existed in federal court, and
private and public factors weighed in favor of the alternative
forum.
       We conclude the trial court erred in raising the affirmative
defense of res judicata on its own motion, and in dismissing
Bistline’s action on a ground that had not been raised in the
moving papers. Therefore, the judgment dismissing Bistline’s
action is reversed and the matter is remanded for further
proceedings not inconsistent with this opinion.
       FACTUAL AND PROCEDURAL BACKGROUND
       1. The prior superior court action, which was removed to
federal court and then dismissed.
       On May 16, 2016, Bistline filed suit in the Los Angeles
Superior Court (L.A. Super. Ct. No. BC620568) (hereafter,
Bistline v. Chase) against various defendants, including
JPMorgan Chase Bank (Chase) and Ditech, alleging, inter alia,



                                2
that Ditech’s threatened foreclosure of her Lancaster residence
(the subject property) was improper due to void assignments of
the deed of trust. Bistline pled that FHLMC (not named as a
defendant in that action) owned the loan and that Ditech was the
loan servicer. The complaint asserted various causes of action
against Ditech, including statutory violations, cancellation of
instruments, quiet title, slander of title, and sought damages as
well as declaratory and injunctive relief.
       On June 24, 2016, Bistline v. Chase was removed to the
United States District Court for the Central District of
California. On September 6, 2016, the district court dismissed
certain claims by Bistline and granted her leave to amend.
       Thereafter, Bistline filed a first amended complaint in
Bistline v. Chase, alleging that the threatened foreclosure of the
subject property was improper due to void assignments of her
deed of trust. She also alleged that the assignments were
recorded in violation of consent orders entered against
codefendant Ocwen Loan Servicing, LLC (Ocwen) and a
stipulated judgment against Ditech.
       On November 28, 2016, the district court granted Ditech’s
motion to dismiss Bistline’s first amended complaint in its
entirety without leave to amend. The court ruled, inter alia, that
because Ditech did not record the deed of trust, it could not be
held liable under Civil Code section 2924.17, which prohibits the
recording or filing of false documents, and that Bistline lacked
standing to challenge the validity of the assignments.
       On April 6, 2017, Bistline appealed the dismissal to the
Ninth Circuit Court of Appeals.




                                3
      On October 18, 2019 (during the pendency of the instant
appeal), the Ninth Circuit affirmed the district court’s judgment
of dismissal.
      2. The instant action.
      On April 19, 2018, during the pendency of the appeal to the
Ninth Circuit, Bistline filed the instant lawsuit in the Los
Angeles Superior Court, Bistline v. Ditech, et al., against Ditech
and FHLMC. Bistline pled, inter alia, that on November 22,
2016, while her home loan modification application was pending,
FHLMC conducted an illegal trustee’s sale of her property, and
thereafter she “received a notice posted to her garage informing
her that ‘all occupants’ must vacate the premises, since [FHLMC]
own[ed] her home.” The complaint alleged causes of action for
fraud, negligence, and wrongful foreclosure, and sought
injunctive relief as well as damages.1
      On June 22, 2018, FHLMC and Ditech filed a motion to
dismiss or stay the action on the ground of forum non conveniens,
supported by a request for judicial notice. The movants did not
move for dismissal on the basis of res judicata, and did not argue
that the instant action was barred by the district court’s decision
in Bistline v. Chase.
      The moving papers simply asserted there was another
action pending between the parties on the same claims in federal

1     The first four causes of action of the complaint sought
injunctive relief against both Ditech and FHLMC. The fifth
cause of action, also for injunctive relief, was directed solely at
FHLMC. The sixth and seventh causes of action alleged fraud
and negligence against Ditech. The eighth cause of action alleged
a claim for negligence against both Ditech and FHLMC. The
ninth cause of action, wrongful foreclosure, was solely against
FHLMC.



                                 4
court, i.e., Bistline v. Chase, and therefore the proper procedure
was a motion to dismiss or stay the instant action on the grounds
of forum non conveniens. The moving papers argued that “the
Ninth Circuit clearly provides a suitable forum” because Bistline
and Ditech were parties to Bistline v. Chase and that action was
still pending. The movants further contended that both private
and public factors weighed in favor of the alternative forum:
litigating the entire matter in federal court would be quicker and
more cost-effective for the parties, and would also relieve the
burden on the state court.
       In opposing the motion to dismiss or stay the action,
Bistline argued there was no merit to the movants’ contention
that the Ninth Circuit was a suitable forum to litigate her claims
because the federal appellate courts are courts of limited
jurisdiction, and her current complaint in the superior court
“does not fall within the definition of what is a final decision
which the appellate court can rule on.”
       In their reply papers, Defendants argued that “if the Ninth
Circuit overrules the dismissal and remands the case back to the
United States District Court, Plaintiff will have an adequate
forum to litigate any and all issues arising from the foreclosure of
the Subject Property.”
       On September 11, 2018, the matter came on for hearing.
The trial court’s tentative ruling was to dismiss the action based
on res judicata. Because Defendants had not moved for dismissal
on the basis of res judicata, it appears that theory was raised by
the trial court sua sponte, and that Bistline had no notice of the
prospect of dismissal on the basis of res judicata until the trial
court issued its tentative ruling. At the hearing, Bistline’s
counsel objected to the trial court having raised the issue of res




                                 5
judicata on its own motion, and counsel asserted that res judicata
“is an argument that can be waived by . . . parties to the case.”
The trial court disagreed and adopted its tentative ruling as the
final decision in the matter.
       The trial court’s order after hearing states: “The instant
litigation is dismissed without prejudice to Plaintiff pursuing
[her] claims in Federal Court, as the instant litigation is barred
by res judicata, pursuant to the entry of dismissal with prejudice
in Federal Case [Bistline v. Chase] on November 28, 2016, which
dismissal is currently on appeal to the Ninth Circuit Court of
Appeals. See, e.g. Calhoun v. Franchise Tax Board (1978) 20
Cal.3d 881, 887 (‘A federal judgment is as final in California
courts as it would be in federal courts. . . . We need not now
decide questions that may arise if plaintiffs are successful in
their Ninth Circuit appeal.’).”2
       On October 12, 2018, Bistline filed a timely notice of appeal
from the judgment of dismissal that was entered on October 2,
2018.3




2     Also pending before the trial court were Defendants’
demurrer as well as their motion to strike Bistline’s punitive
damages allegations, which were not ruled on due to the trial
court’s grant of the motion to dismiss.

3    The judgment is appealable. “ ‘[C]laims that are dismissed
without prejudice are no less final for purposes of the one final
judgment rule than are adjudicated claims . . . .’ [Citation.]”
(Kurwa v. Kislinger (2013) 57 Cal.4th 1097, 1104.)




                                 6
       3. Subsequent proceedings.
       On October 18, 2018, shortly after the trial court dismissed
the instant action, Bistline filed a new action in the district court
against Ditech and FHLMC. The latest complaint included
causes of action for injunctive relief, fraud, negligence, and
wrongful foreclosure, and asserted that Ditech improperly
foreclosed on Bistline’s residence while her application for a loan
modification was pending.4
       On March 4, 2019, Ditech filed a notice of bankruptcy filing
and imposition of automatic stay. This court stayed Bistline’s
appeal pending determination of the proceedings before the
bankruptcy court. Thereafter, this court lifted the appellate stay
as to respondent FHLMC. Subsequently, after notice from the
parties that the bankruptcy stay did not preclude Bistline from
proceeding with her equitable claims against Ditech in state
court, we partially lifted the appellate stay as to respondent
Ditech, allowing Bistline to challenge the dismissal of her




4      The instant appeal from the judgment of dismissal, which
was without prejudice to Bistline pursuing her remedies in
federal court, is not mooted by the new action that she filed in the
district court on October 18, 2018. As Bistline has argued, if this
court were to dismiss the instant appeal as moot, the defendants
in the new district court action may cite the trial court’s res
judicata ruling herein to argue that the new action is barred by
res judicata. Moreover, Bistline is entitled to litigate her claims
in an appropriate forum of her choosing. Therefore, the instant
appeal is not mooted by the filing of the new action in the district
court.




                                  7
equitable claims against Ditech (i.e., the first four causes of
action seeking injunctive relief).5
                         CONTENTIONS
      Bistline contends: ordinarily a decision on a motion to stay
or dismiss an action for forum non conveniens is reviewed for an
abuse of discretion, but here, the trial court’s decision granting
Defendants’ motion due to the bar of res judicata presents a
question of law to be reviewed de novo; res judicata is the only
issue in this appeal because the trial court did not consider the
factors that govern a forum non conveniens analysis; and res
judicata does not bar the instant action, Bistline v. Ditech,
because it involves different allegations and a different defendant
than Bistline v. Chase.




5      With respect to the balance of the complaint, the fifth and
ninth causes of action were not directed at Ditech. As for the
sixth, seventh, and eighth causes of action, wherein Bistline
sought monetary damages on her claims against Ditech for fraud
and negligence, the parties recognize that Bistline is
permanently enjoined by the bankruptcy plan that was approved
on September 26, 2019, from proceeding on those claims.
Therefore, insofar as Bistline’s appeal challenges the dismissal of
her sixth, seventh, and eighth causes of action against Ditech,
that portion of the appeal must be dismissed.




                                 8
                           DISCUSSION
       1. Governing principles.
             a. A motion to dismiss or stay an action based on the
forum non conveniens doctrine.
       Defendants’ motion that led to the trial court’s dismissal
was a motion to stay or dismiss Bistline’s action on the ground of
forum non conveniens. (Code Civ. Proc., § 410.30, subd. (a).)6
Such a motion is subject to the two-part analysis set forth in
Stangvik v. Shiley Inc. (1991) 54 Cal.3d 744 (Stangvik).
       “In determining whether to grant a motion based on forum
non conveniens, a court must first determine whether the
alternate forum is a ‘suitable’ place for trial. If it is, the next step
is to consider the private interests of the litigants and the
interests of the public in retaining the action for trial in
California. The private interest factors are those that make trial
and the enforceability of the ensuing judgment expeditious and
relatively inexpensive, such as the ease of access to sources of
proof, the cost of obtaining attendance of witnesses, and the
availability of compulsory process for attendance of unwilling
witnesses. The public interest factors include avoidance of
overburdening local courts with congested calendars, protecting
the interests of potential jurors so that they are not called upon
to decide cases in which the local community has little concern,
and weighing the competing interests of California and the


6      Code of Civil Procedure section 410.30 states in relevant
part at subdivision (a) that “[w]hen a court upon motion of a
party or its own motion finds that in the interest of substantial
justice an action should be heard in a forum outside this state,
the court shall stay or dismiss the action in whole or in part on
any conditions that may be just.”



                                   9
alternate jurisdiction in the litigation. [Citations.]” (Stangvik,
supra, 54 Cal.3d at p. 751.)
        The ultimate question is whether the balancing of the
Stangvik factors shows that California is an inconvenient forum.
(Morris v. AGFA Corp. (2006) 144 Cal.App.4th 1452, 1464
(Morris).) The defendant, as the moving party, bears the burden
of proof. (Stangvik, supra, 54 Cal.3d at p. 751.)
        “The trial court’s first determination, whether there is a
suitable alternative forum, is a nondiscretionary legal question
subject to de novo review. [Citations.] The second determination,
the weighing of private and public factors, is discretionary and
subject to review only for an abuse of discretion—and we must
accord substantial deference to the trial court’s balancing of the
factors. [Citations.]” (Morris, supra, 144 Cal.App.4th at p. 1464.)
               b. Res judicata principles.
        “ ‘Res judicata’ describes the preclusive effect of a final
judgment on the merits. Res judicata, or claim preclusion,
prevents relitigation of the same cause of action in a second suit
between the same parties or parties in privity with them.”
(Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 896–897
(Mycogen).) Three elements must exist for res judicata to apply:
“ ‘(1) the decision in the prior proceeding is final and on the
merits; (2) the present proceeding is on the same cause of action
as the prior proceeding; and (3) the parties in the present
proceeding or parties in privity with them were parties to the
prior proceeding.’ ” (Planning & Conservation League v. Castaic
Lake Water Agency (2009) 180 Cal.App.4th 210, 226.)
        The applicability of the doctrine of res judicata is a question
of law for this court’s de novo review. (Association of Irritated




                                  10
Residents v. Department of Conservation (2017) 11 Cal.App.5th
1202, 1218.)
       2. The trial court erred in granting the motion to dismiss or
stay the action for forum non conveniens on the basis of res
judicata, because Defendants did not move for dismissal on that
basis, and because the issue of res judicata is outside the scope of
a forum non conveniens motion.
       As indicated, the trial court granted the motion to dismiss
or stay the instant action for forum non conveniens on the ground
the action is barred by res judicata—a ground that had not been
specified in Defendants’ notice of motion and that had not been
briefed, and on that basis dismissed the action without prejudice
to Bistline pursuing her remedies in federal court. The trial
court’s ruling was clearly erroneous.
       A “basic tenet of motion practice is that the notice of motion
must state the grounds for the order being sought (Code Civ.
Proc., § 1010; Cal. Rules of Court, rule 3.1110(a)), and courts
generally may consider only the grounds stated in the notice of
motion. [Citation.] . . . . [¶] The purpose of the notice
requirements ‘is to cause the moving party to sufficiently define
the issues for the information and attention of the adverse party
and the court.” ’ [Citations.] Sometimes this purpose is met
notwithstanding deficient notice. For example, it may be
sufficient that the supporting papers contain the grounds for the
relief sought, even if the notice does not. [Citations.] It also may
be sufficient if the omitted issue, or ground for relief, was raised
without objection before the trial court. [Citation.]” (Kinda v.
Carpenter (2016) 247 Cal.App.4th 1268, 1277.)
       Here, however, as conceded at page 15 of the respondents’
brief on appeal, “res judicata was not raised below in




                                 11
[Defendants’] Motion to Dismiss/Stay because the [federal court]
entered judgment after briefing, but before the trial court ruled
on the [instant] Motion.[7] Regardless, [Defendants contend] this
Court may affirm dismissal based on res judicata.” (Italics ours,
original italics omitted.)
       Thus, the record reflects that res judicata was raised by the
trial court sua sponte, and Bistline had no notice of the prospect
of dismissal on that basis until the trial court issued its tentative
ruling. At the hearing on the matter, Bistline’s counsel duly
objected to the trial court’s having raised the issue of res judicata
on its own motion, and her counsel further stated that res
judicata “is an argument that can be waived by . . . parties to the
case.” The trial court nonetheless adopted its tentative ruling as
its final decision in the matter.
       We conclude the trial court erred in granting the motion to
dismiss on the basis of res judicata, without giving Bistline the
opportunity to brief the issue. The trial court’s grant of the
motion to dismiss on a ground that had not been raised by
Defendants in their notice of motion contravened basic tenets of
law and motion practice (Code Civ. Proc., § 1010; Cal. Rules of
Court, rule 3.1110(a)), as well as Bistline’s right to notice, which
is an element of due process. (Derry v. Superior Court (1968) 266
Cal.App.2d 556, 558–561 [oral motion to dismiss, not in


7      Submission of this matter was deferred to enable the
parties to file supplemental letter briefs after oral argument,
which this court then considered. In their supplemental letter
brief filed June 26, 2020, Defendants cite page 581 of the
Appellant’s Appendix to support a new assertion that Defendants
did in fact raise the issue of res judicata in their motion below.
The cited page does not support that assertion.



                                 12
compliance with Code Civ. Proc., § 1010, violated plaintiff’s right
to due process].)
       The trial court further erred in raising the issue of res
judicata on its own motion because, as Bistline’s counsel argued
below, “res judicata can be waived if not asserted as an
affirmative defense.” (JSJ Limited Partnership v. Mehrban
(2012) 205 Cal.App.4th 1512, 1526.) Res judicata was not the
theory on which Defendants moved for forum non conveniens.
Thus, it was error for the trial court to inject that issue into the
proceeding.
       Apart from the fact that Defendants’ motion did not invoke
the affirmative defense of res judicata, res judicata is not an issue
within the scope of a motion to dismiss or stay for forum non
conveniens. The doctrine of res judicata bars an action from
being relitigated (Mycogen, supra, 28 Cal.4th at pp. 896–897),
while forum non conveniens is an equitable doctrine invoking the
discretionary power of a court to decline to exercise its
jurisdiction over a cause of action when it determines the action
may be more appropriately litigated elsewhere. (Stangvik, supra,
54 Cal.3d at p. 751.) As set forth above, in deciding whether to
grant a motion based on forum non conveniens, the trial court
examines whether the alternate forum is a suitable place for
trial, and if it is, the trial court considers the private interests of
the litigants and the interests of the public in retaining the action
for trial in California. (Ibid.) Therefore, the trial court’s order
dismissing the action for forum non conveniens cannot be upheld
on the theory that the instant action is barred by res judicata.
       In an attempt to uphold the judgment, Defendants also
resort to the settled principle that a decision correct on any
theory will be affirmed on appeal, even though the trial court’s




                                  13
decision may have been based on an erroneous rationale. (See,
e.g., Davey v. Southern Pac. Co. (1897) 116 Cal. 325, 329–330
(Davey); D’Amico v. Board of Medical Examiners (1974) 11 Cal.3d
1, 18–19 (D’Amico).) We are not persuaded. As discussed, the
affirmative defense of res judicata is not within the scope of a
motion to dismiss or stay an action for forum non conveniens, and
the trial court’s analysis simply conflated the issues of res
judicata and forum non conveniens. The trial court granted
Defendants’ motion to dismiss or stay the action for forum non
conveniens, by dismissing Bistline’s action “without prejudice to
Plaintiff pursuing [her] claims in Federal Court.” (Italics added.)
The trial court did so on the ground that “the instant litigation is
barred by res judicata.” The trial court’s decision is untenable.
Assuming arguendo that Bistline’s claims are barred by res
judicata, a conclusion we do not reach, the trial court logically
should have dismissed Bistline’s action with prejudice.
Therefore, the judgment dismissing the action without prejudice,
to enable Bistline to pursue her claims in federal court, cannot be
affirmed on the theory that the action is barred by res judicata.
Accordingly, this is not a case in which a judgment that is correct
in result may be affirmed on appeal, “regardless of the
considerations which may have moved the trial court to its
conclusion.” (Davey, supra, 116 Cal. at p. 329; accord, D’Amico,
supra, 11 Cal.3d at p. 19.)




                                14
       3. Respondents’ arguments regarding forum non
conveniens are not properly before this court because the issue of
forum non conveniens must be decided by the trial court in the
first instance.
       Alternatively, respondents contend this court should affirm
the dismissal of Bistline’s action based on forum non conveniens
because the trial court properly evaluated the relevant factors, it
correctly found that the district court is a suitable forum, and
both private factors and public factors justified dismissal of the
instant action.
       The argument is meritless because it is clear from the
record that the trial court did not conduct a forum non conveniens
analysis, did not exercise its discretion, and simply dismissed the
action on the ground that it is barred by res judicata. We will not
presume the trial court engaged in the exercise of its discretion
under Code of Civil Procedure section 410.30 in light of a record
that clearly demonstrates the trial court did not exercise its
discretion in the matter. (See People v. Lettice (2013) 221
Cal.App.4th 139, 152.) “Since the trial court’s comments . . .
indicate that the trial court did not exercise its discretion, we
cannot presume that it did.” (Posey v. Leavitt (1991) 229
Cal.App.3d 1236, 1249.)
       We decline to usurp the discretion of the trial court by
ruling on the motion for forum non conveniens in the first
instance. Therefore, we reverse the judgment of dismissal and
remand the matter. On remand, Defendants may re-notice their
motion to dismiss or stay the action based on forum non
conveniens, if they choose to do so. Further, Defendants are not
precluded on remand from re-noticing their demurrer or motion
to strike, or from bringing a motion for judgment on the




                                15
pleadings or other appropriate motion asserting res judicata or
other defenses relating to the prior or pending federal court
actions.
                            DISPOSITION
       Insofar as Bistline’s appeal challenges the dismissal of her
sixth, seventh, and eighth causes of action against Ditech for
monetary damages, that portion of the appeal is dismissed. (See
fn. 5, ante.) In all other respects, the judgment of dismissal is
reversed and the matter is remanded for further proceedings not
inconsistent with this opinion. Bistline shall recover her costs on
appeal.
       NOT TO BE PUBLISHED IN THE OFFICIAL
REPORTS




                                           EDMON, P. J.


We concur:




                  LAVIN, J.




                  EGERTON, J.




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