Filed 7/31/14 Tustin v. Bank of America CA6

            NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been
certified for publication or ordered published for purposes of rule 8.1115.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 SIX


WAYNE TUSTIN,                                                                2d Civil No. B251211
                                                                           (Super. Ct. No. 1402435)
     Plaintiff and Appellant,                                               (Santa Barbara County)

v.

BANK OF AMERICA, N.A., et al.,

     Defendant and Respondent.




                   Wayne Tustin appeals a judgment entered after the trial court
sustained a demurrer to his second amended complaint without leave to amend.
(Code Civ. Proc., § 581d.) Appellant's action seeks (1) to rescind the secured
promissory note and deed of trust he executed in favor of Countrywide Bank,
N.A. (Countrywide); (2) to enjoin foreclosure proceedings emanating from his
default; and (3) to recover compensatory and punitive damages. We affirm.
                          FACTUAL AND PROCEDURAL HISTORY
                   On March 25, 2008, Appellant executed a promissory note for $1
million that was secured by real property he and his wife owned in Santa
Barbara. The deed of trust identifies Countrywide as the lender, ReconTrust
Company (ReconTrust) as the trustee and "MERS" as the lender's nominal
beneficiary. The deed of trust invests the trustee with a power of sale in the
event the borrowers default. The loan closed and, based upon the recording date
of the deed of trust, it appears the funds were distributed on or about April 1,
2008. In July 2008, Bank of America (the Bank) and Countrywide merged.
              Appellant made monthly payments of $4,895 until July 2011. On
October 19, 2011, MERS assigned its beneficial interest in the deed of trust
executed by Appellant to the Bank. The assignment was recorded on October
25, 2011. The Bank then instructed ReconTrust to execute and record a Notice
of Default and Election to sell the property securing Appellant's promissory note.
Appellant's arrearage at that time was said to be $44,835.59. A Notice of
Trustee's Sale has not yet been scheduled.
              In April 2012, Appellant sent the Bank a letter declaring he was
rescinding the promissory note and deed of trust. He has never tendered the
balance of the principal and interest due on the loan or any part of it.
              On June 22, 2012, Appellant filed the first version of his complaint
against Respondents. Respondents' demurrers were sustained with leave to
amend. On October 11, 2012, Appellant filed a first amended complaint that also
drew a demurrer that was sustained with leave to amend. The most recent
version of Appellant's second amended complaint was filed on March 25, 2013.
              The second amended complaint alleges that Countrywide did not
make a loan to him. Instead, he claims that he was induced to execute a
promissory note that was "later monetized . . . to create some sort of 'Bearer
Instrument' which [Countrywide] later sold to third party-investors." He asserts
Countrywide then counted "Appellant's obligation as an asset at a 'hyper-inflated
value in a transaction account for the purpose of creating new money for itself
without disclosure to [Appellant].'" Appellant alleged that Countrywide's
practice was an "investment transaction scheme" that "duped [him] into loaning
himself his own []money." Appellant asserts that Countrywide did not disclose
its strategy to him and contends it was unjustly enriched at his expense.


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              On April 29, 2013, Respondents demurred to Appellant's second
amended complaint, asserting that it did not state facts sufficient to state a cause
of action and that he should not be granted leave to amend. (Code Civ. Proc., §
430.10, subds. (e) & (f).) Respondents requested and the trial court agreed to
take judicial notice of the deed of trust, the assignment of the deed of trust and
the notice of default and election to sell. (Evid. Code, § 452, subds. (c) & (d).)
              On June 5, 2013, the trial court sustained Respondents' demurrer
without leave to amend. Appellant appeals, contending (1) the trial court erred
by sustaining the demurrer without leave to amend; (2) that the trial court was
biased because it ruled against him; and (3) he was denied due process of law by
the ruling.
                                   DISCUSSION
                                          I.
                                Standard of Review
              On appeal from a judgment dismissing an action following the
sustaining of a demurrer without leave to amend, our standard of review is de
novo, i.e., we exercise our independent judgment whether the complaint alleges
facts sufficient to state a cause of action under any possible legal theory.
(Lafferty v. Wells Fargo Bank (2013) 213 Cal.App.4th 545, 564.) We treat the
demurrer as admitting all material facts properly pleaded, but not contentions,
deductions, or conclusions of fact or law. (Aryeh v. Canon Business Solutions,
Inc. (2013) 55 Cal.4th 1185, 1189, fn. 1; Lafferty, supra, at p. 564.).) We also
give the complaint a reasonable interpretation, reading it in context and as a
whole, to determine whether plaintiff has stated a cause of action. (Lafferty,
supra, at p. 564.)
              Appellant bears the burden of showing that the factual allegations
establish every element of each cause of action pleaded. (Martin v. Bridgeport
Community Assn., Inc. (2009) 173 Cal.App.4th 1024, 1031.) We affirm the trial
court's ruling if there is any ground upon which the demurrer could have been


                                          3
properly sustained. (Intengan v. BAC Home Loans Servicing LP (2013) 214
Cal.App.4th 1047, 1052; Scott v. JPMorgan Chase Bank, N.A. (2013) 214
Cal.App.4th 743, 752.) Appellant also bears the burden of showing that a
reasonable possibility exists that he can amend his pleading to state a cause of
action. (Fuller v. First Franklin Financial Corp. (2013) 216 Cal.App.4th 955,
962; Rakestraw v. California Physicians' Service (2000) 81 Cal.App.4th 39, 44
["Where the appellant offers no allegations to support the possibility of
amendment and no legal authority showing the viability of new causes of action,
there is no basis for finding the trial court abused its discretion when it sustained
the demurrer without leave to amend"].)
                                          II.
   It was not error to sustain Respondents' demurrer without leave to amend.
              Appellant states in his second amended complaint that he is
"untrained in the law, unfamiliar with local rules, not self-represented [sic], not
represented by licensed counsel, an individual in the exercise of accountability."
He also asked that his "pleadings 'be liberally construed' pursuant to the 'Kerner
Doctrine.'"
              "In Propria persona litigants are entitled to the same, but no greater,
rights than represented litigants and are presumed to know the [procedural and
court] rules. . . ." (Wantuch v. Davis (1995) 32 Cal.App.4th 786, 795.) For any
appellant, "[a]ppellate briefs must provide argument and legal authority for the
positions taken. 'When an appellant fails to raise a point, or asserts it but fails to
support it with reasoned argument and citations to authority, we treat the point as
waived. . . .' [Citation.]" (Nelson v. Avondale Homeowners Assn. (2009) 172
Cal.App.4th 857, 862.) "We are not bound to develop appellants' argument for
them. [Citation.] The absence of cogent legal argument or citation to authority
allows this court to treat the contention as waived. [Citations.]" (In re Marriage
of Falcone (2008) 164 Cal.App.4th 814, 830.)



                                          4
               Appellant's Opening Brief does nothing more than reiterate the
allegations of his second amended complaint. There is no reasoned argument or
citation to authority that supports the nonsensical contention that by promising to
repay the $1 million he induced Countrywide to lend to him, the act of signing
his name somehow cancels his obligation to pay the money back. He offered
nothing that shows there is a reasonable possibility he can amend his pleading to
state a cause of action.
               To the extent Appellant alleges that he did not understand that his
note was a security instrument and could be sold or transferred to others, he
cannot state a cause of action that warrants the relief he requests. (Fontenot v.
Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 272 ["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"].) Ordinarily, a party to a contract cannot justifiably claim unawareness of
the express provisions of the contract. (Fuller v. First Franklin Financial Corp.,
supra, 216 Cal.App.4th 955, 964.) The promissory note and deed of trust that
Appellant executed specifically provide that the instruments are "Security
Instruments" that may be transferred or sold without prior notice to him. "A
cardinal rule of contract law is that a party's failure to read a contract, or to
carefully read a contract, before signing it is no defense to the contract's
enforcement. [Citation.]" (Desert Outdoor Advertising v. Superior Court (2011)
196 Cal.App.4th 866, 872.)
               Appellant did not allege that he returned or offered to return the
loan proceeds prior to requesting the remedy of rescission of the refinancing
transaction. (Garcia v. Wachovia Mortgage Corp. (C.D. Cal. 2009) 676
F.Supp.2d 895, 901 ["'Rescission is an empty remedy without [plaintiff's] ability
to pay back what she has received'"].) Civil Code section 1691 provides:
"Subject to Section 1693, to effect a rescission a party to the contract must,


                                           5
promptly upon discovering the facts which entitle him to rescind if he is free
from duress, menace, undue influence or disability and is aware of his right to
rescind: [¶] . . . [¶] (b) Restore to the other party everything of value which he
has received from him under the contract or offer to restore the same upon
condition that the other party do likewise, unless the latter is unable or positively
refuses to do so."
                                         III.
            Bias cannot be inferred from adverse findings or rulings.
              Appellant argues "extreme prejudice and bias" must be inferred
from findings and rulings made by the trial judge because they were adverse to
the propositions he advanced. His contention is without merit. The findings and
observations of a judge in the discharge of his or her duty to resolve disputes is
not evidence of bias or prejudice. (Jack Farenbaugh & Son v. Belmont
Construction (1987) 194 Cal.App.3d 1023, 1031, citing Estate of Friedman
(1915) 171 Cal. 431, 440.)
                                         IV.
          Sustaining the demurrer does not deny Appellant due process.
              Appellant argues that the trial court's ruling and the order of
dismissal denied him due process of law because he is unable to proceed to trial
regarding his claims against Respondents.
              Appellant received notice of the Respondents' demurrer to his
second amended complaint and had an opportunity to be heard. (American
Corporate Security v. Su (2013) 220 Cal.App.4th 38, 46 [due process principles
require reasonable notice and opportunity to be heard before governmental
deprivation of a significant property interest].) But before Appellant is entitled
to trial on the merits of his claims, the law requires him to plead a viable cause of
action against Respondents. When he did not do so, and failed to give the trial
court any indication that he might be able to do so, the court properly terminated
the action at the pleading stage.


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             The judgment of dismissal is affirmed. Respondents shall recover
costs on appeal.
             NOT TO BE PUBLISHED.




                                          BURKE, J.*


We concur:



             GILBERT, P. J.



             PERREN, J.




*
 (Judge of the Superior Court of San Luis Obispo County, assigned by the Chief
Justice pursuant to art. 6, § 6 of the Cal. Const.)

                                      7
                                James E. Herman, Judge

                        Superior Court County of Santa Barbara

                         ______________________________


               Wayne Tustin, in pro. per., for Plaintiff and Appellant.
               Reed Smith, David Reidy and Matthew J. Brady for Defendants and
Respondents.
