Filed 8/20/14 Harris v. Bank of America CA4/2

                     NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for
                               publication or ordered published for purposes of rule 8.1115.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

                                   FOURTH APPELLATE DISTRICT

                                                 DIVISION TWO



MONIQUE HARRIS,

         Plaintiff and Appellant,                                         E054887

v.                                                                        (Super.Ct.No. CIVRS1009937)

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

         Defendants and Respondents.



         APPEAL from the Superior Court of San Bernardino County. Joseph R. Brisco,

Judge. Affirmed.

         Monique Harris, in pro. per., for Plaintiff and Appellant.

         Bryan Cave, Sean D. Muntz and Allen J. Beck for Defendants and Respondents.

         Monique Harris1 (Harris) sued Bank of America, N.A. (Bank); Recontrust

Company, N.A. (Recontrust); Countrywide Home Loans, Inc. (Countrywide); Landsafe,

Inc. (Landsafe); and Shea Homes, Inc. (Shea). The first amended complaint (FAC)


         1   Harris is a self-represented litigant, but is also a licensed California attorney.


                                                              1
included causes of action for (1) misrepresentation and fraud; (2) fraud in the

inducement of an arbitration agreement; and (3) unlawful business practices in violation

of Business and Professions Code section 17200.2 Bank, Recontrust, Countrywide, and

Landsafe (collectively, “defendants”) demurred to the FAC. The trial court sustained

the demurrer without leave to amend and dismissed Harris’s lawsuit with prejudice.

       Harris raises five issues on appeal. First, Harris contends the trial court erred

because the FAC states causes of action for misrepresentation and fraud. Second,

alternatively, Harris asserts the FAC could be amended to cure any defect. Third,

Harris contends the trial court erred by sustaining the demurrer because the FAC states a

cause of action for unlawful, unfair, or fraudulent business practices. (§ 17200.)

Fourth, in the alternative, Harris asserts any defect in the business practices cause of

action could be cured by amendment. Fifth, Harris contends she was not required to

tender payment on her mortgage because the FAC alleged fraud. We affirm the

judgment.

                              PROCEDURAL HISTORY

       A.     ORIGINAL COMPLAINT

       On September 10, 2010, Harris filed her original complaint against Shea and

Countrywide, and included causes of action for negligence, breach of contract,

misrepresentation and fraud, and unlawful business practices (§ 17200). Countrywide

demurred to the original complaint. The trial court sustained the demurrer without leave

       2All subsequent statutory references will be to the Business and Professions
Code, unless otherwise indicated.


                                             2
to amend on the negligence and breach of contract causes of action. The trial court

sustained the demurrer with leave to amend on the unlawful business practices, and

misrepresentation and fraud causes of action.

       B.      AMENDED COMPLAINT

       Harris’s FAC was filed in February 2011. Harris sued defendants and Shea. The

causes of action included (1) misrepresentation and fraud, against defendants and Shea;

(2) fraud in the inducement of an arbitration agreement, against Shea; and (3) unlawful

business practices in violation of section 17200, against defendants and Shea.

       In the FAC, Harris explained she was seeking to “rescind an illegal and void

residential mortgage loan.” Harris asserted Shea, Countrywide and Landsafe conspired

together in “an ‘inflated appraisal scheme,’” to cause fraudulent property appraisals to

be prepared. Harris alleged Countrywide required homebuyers to have their properties

appraised by Landsafe, and Landsafe used appraisers who appraised properties “at or

above contract price, even [if] it meant completing appraisals in violation of regulatory

guidelines.”

       Harris’s home was located in Rancho Cucamonga (the property). Harris asserted

the appraisal of the property was “tainted with false and misleading data, deceptive

practices, and violations of the regulatory standards for professional appraisers.” For

example, Harris alleged the appraiser ignored falling property values. Harris alleged the

appraisal scheme caused homebuyers, such as Harris, “to obtain mortgage loans far in

excess of their property’s true value, which in turn, caused homebuyers to go into

default and face foreclosure.”


                                            3
       In May 2007, Harris agreed to purchase the property from Shea for $459,500.

Shea employees, Linda Harrington and Tina Pendleton, told Harris she could cancel the

purchase agreement if the appraisal reflected the property’s value was less than the

agreed-upon purchase price. After entering into the purchase agreement, Shea

employees recommended Harris apply for a mortgage with Countrywide. Harris

entered into a loan agreement with Countrywide on or about August 1, 2007.

Countrywide then ordered an appraisal from Landsafe. The appraisal was assigned to

an “‘approved’ appraiser[] who appraised the [p]roperty on or about August 24, 2007 at

$459,600 ($100 more than the sale/contract price).”

       Harris alleged that after the sale of the property closed, she discovered “the

appraisal was false and that the appraiser purposefully failed to consider comparable

sales that would have revealed lower values, failed to disclose information pertaining to

the downward trending real estate market and made false statements of market

stability.” Harris also alleged “the appraiser failed to take into account reduced prices,

incentives and other closing assistance (concessions) provided by Shea Homes that both

Countrywide and Shea Homes knew or should have known would reduce the value of

Shea Homes’ properties.” Harris asserted the property was appraised for “nearly

$100,000 more than the [p]roperty’s true value.”

       Harris alleged that if a true and accurate appraisal had been conducted, then she

would have canceled the purchase agreement and not purchased the property. Harris

alleged defendants’ conduct caused her to (1) overpay for her home; (2) overpay

principal, interest, and taxes; and (3) suffer foreclosure.


                                              4
       In the FAC, the first and second causes of action for misrepresentation and fraud

were combined under a single heading, i.e., the heading read, “First and Second Causes

of Action.” Harris asserted Shea, Countrywide, and Landsafe participated in “an

‘inflated appraisal scheme’ with the intent to defraud,” and that conduct caused Harris

to overpay for the property by approximately $100,000.

       The third cause of action was for fraud in the inducement of the arbitration

agreement. Harris asserted two Shea employees incorrectly told Harris that acceptance

of the arbitration clause in the purchase agreement was required in order to purchase the

property. Harris alleged that she learned the property could have been purchased even

if she elected not to submit to binding arbitration.

       The fourth cause of action was for unlawful business practices in violation of

section 17200. Harris asserted defendants’ “‘inflated appraisal scheme’” constituted an

unlawful business practice because it led to “unjust enrichment and is immoral,

unethical, oppressive, unscrupulous, substantially injurious to consumers and offends

public policy.” Harris asserted she “lost money or property as a result” of the

defendants’ business practices.

       Harris sought restitution, general damages, punitive damages, costs, attorney’s

fees (if they were incurred), and injunctive relief (a) stopping the trustee’s sale of the

property, (b) rescinding the mortgage on the property, and (c) disgorgement of all

profits associated with the allegedly unlawful business practices, including the $5,000

deposit paid by Harris.




                                              5
       C.     DEMURRER

       Defendants demurred to the FAC. Defendants asserted Harris purchased a

townhome from Shea in May 2007 for a total purchase price of $460,870. Harris

obtained a mortgage from Countrywide in the amount of $368,000. Harris also

obtained a $92,000 home equity line of credit (HELOC). Harris stopped making

mortgage payments on the property in September 2009.

       Defendants asserted the first, second, and fourth causes of action, for fraud,

misrepresentation, and unlawful business practices did not include facts sufficient to

constitute a cause of action. Defendants argued appraisal reports are made for the

lender’s benefit, not the buyer’s benefit, and therefore any problems with the appraisal

do not create a cause of action for a buyer because the lender and appraiser do not owe a

duty to the buyer in relation to preparing the appraisal. (Nymark v. Heart Fed. Savings

& Loan Assn. (1991) 231 Cal.App.3d 1089, 1097 (Nymark).) Defendants explained the

appraisal is conducted for the purposes of helping the lender determine how much

money to loan a buyer, and therefore, is only conducted for the lender’s purposes.

       Additionally, defendants asserted the fraud and misrepresentation causes of

action failed because Harris did not allege sufficiently specific facts. Defendants argued

Harris failed to allege “how, why, when, where, and by whom, any alleged

misrepresentations were made. She does not provide any detail regarding the alleged

concealment of material facts. Nor does she allege the authority of the individuals

making the statements to speak on behalf of [d]efendants, what they said or wrote, or

when the representations were made.”


                                            6
       Defendants also asserted Harris failed to allege she justifiably relied on the

appraisal in purchasing the property. Further, defendants argued Harris, as part of the

loan applications, “expressly acknowledged Countrywide made no representations to

her about the condition or value of the property.” Therefore, defendants asserted, there

could not be justifiable reliance.

       As to the fourth cause of action, for unfair business practices, defendants asserted

Harris lacked standing to bring the cause of action because she failed to “demonstrate[]

a loss of money or property. [Harris] is in default on her loan and her property has not

yet been foreclosed upon.” In regard to fraudulent conduct underlying the unfair

business practices allegation, defendants asserted Harris failed to plead facts with

sufficient specificity, as set forth ante. As to Harris’s request for an injunction stopping

the trustee’s sale, defendants argued the foreclosure could not be stopped because Harris

failed to tender payment on the mortgage.

       D.       OPPOSITION

       Harris opposed the demurrer. In regard to misrepresentation and fraud, Harris

argued that she had been told by an employee of Countrywide, Roy West (West), that if

the property appraised for less than the agreed-upon purchase price, then Harris would

not be obligated to purchase the property, and therefore the appraisal was not conducted

merely for the lender’s purposes. Harris asserted she would have canceled the purchase

agreement, had the appraisal been properly conducted and reflected the lower value of

the property.




                                             7
       Further, Harris asserted the heightened pleading requirements for fraud are

relaxed when the defendants necessarily possess full information concerning the facts at

issue. (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35

Cal.3d 197, 217, superseded by statute on other grounds.) Harris asserted defendants

had full knowledge of the property’s true value and the poor market conditions, and

therefore, they “knew or should have known that their representations . . . were false

and misleading.” As a result, Harris asserted the heightened pleading requirements

were inapplicable.

       In regard to unlawful business practices, Harris asserted she did suffer damages

as a result of defendants’ business practices. Harris argued she paid $5,000 to Shea as

part of purchasing the property and she made payments to defendants for a mortgage

that she would not have obtained but for defendants’ unlawful business practices.

Additionally, Harris asserted she could lose her home through foreclosure, which would

result in a loss of property. Harris also asserted defendants “advised the appraiser who

conducted the appraisal herein to inflate the Property’s value in violation of California

Civil Code Section 1090.5.”

       Harris asserted she was not required to tender full payment on the mortgage

because requiring payment would permit defendants to benefit from their wrongdoing,

in that full payment would be approximately $100,000 more than the property’s value.

Alternatively, Harris requested leave to amend the FAC because she “is confident she

can adequately plead her causes of action.” Harris did not provide any specific

information regarding how she would amend the FAC.


                                             8
       E.     REPLY

       Defendants replied to Harris’s opposition. Defendants asserted Harris had

negotiated her purchase price with Shea, entered into a purchase agreement with Shea,

and applied for a Countrywide mortgage prior to the appraisal being conducted.

Defendants asserted Harris failed to allege in the FAC and opposition that the appraisal

was conducted for her benefit. Defendants again argued the appraisal is for the lender’s

benefit, not the buyer’s benefit. (Nymark, supra, 231 Cal.App.3d at p. 1097.)

Defendants asserted that even if the appraisal overvalued the home, Harris would not

have a right to recover against defendants because defendants owed no duty to Harris in

relation to the appraisal.

       In regard to the fraud pleading requirements, defendants asserted fraud must be

pled with specificity. Defendants asserted the FAC only reflected agents of Shea made

various representations to Harris—not defendants’ agents. Defendants asserted the

allegation in the opposition, that West, a Countrywide employee, made a representation

to Harris about canceling the purchase agreement if the appraised were less than the

purchase price was “inconsistent with [Harris’s] pleaded allegations, and should be

ignored. By the time the appraisal was prepared, [Harris] already agreed to buy the

home, at a price she negotiated with Shea Homes, Inc. The appraisal conducted by

Landsafe was not intended to help [Harris] determine a purchase price. It was intended

for Countrywide to determine whether the loan would be adequately secured.”

       In regard to reliance and the alleged comments by West, defendants asserted

Harris could not show she justifiably relied on the comments because (1) Harris had


                                            9
already agreed to purchase the property and negotiated the price prior to the appraisal

being conducted, and (2) in Harris’s loan application she acknowledged “‘neither

Lender nor its agents, brokers, insurers, servicers, successors or assigns has made any

representation or warranty, express or implied, to me regarding the property or the

condition or value of the property.’” Defendants asserted Harris’s failure to dispute

these two facts, or set forth facts reflecting justifiable reliance, cause her causes of

action for misrepresentation and fraud to fail.

       Next, defendants asserted Harris failed to allege damages. Defendants asserted

Harris lived at the property payment-free for approximately two years and the property

had not been foreclosed upon. Additionally, defendants asserted Harris agreed to

purchase the property, so if she were paying a high principal, interest, and taxes, that

was her choice. Defendants again stressed that Harris negotiated the purchase prior to

the appraisal being conducted. Defendants again asserted the unlawful business

practices cause of action failed because Harris failed to meet the pleading requirements

for fraud—the act underlying the cause of action.

       In regard to the allegation in the opposition—that defendants advised the

appraiser to inflate the property’s value—defendants asserted Civil Code section 1090.5

prohibits a “person with an interest in a real estate transaction involving a valuation

[from] improperly influenc[ing] or attempt[ing] to improperly influence the

development, reporting, result, or review of that valuation, through coercion, extortion,

bribery, intimidation, compensation, or instruction.” Defendants argued Harris failed to

allege defendants had an interest in the real estate transaction, as the term is used in the


                                              10
statute. Additionally, defendants asserted Civil Code section 1090.5 does not create a

private right of action.

       Defendants further asserted Harris should be required to tender payment on the

mortgage to stop the trustee’s sale because Harris freely assumed the debt, and it would

be “inequitable to allow her to continue living in [the] property for free.”

       F.     HEARING

       On August 11, 2011, the trial court held a hearing on defendants’ demurrer.

Harris informed the court she was working on a loan modification that would settle the

case. Harris requested the trial court dismiss the case without prejudice. Defendants

asserted Harris decided to dismiss the case after receiving the court’s tentative ruling.

Harris denied the assertion. Harris explained she was planning to request the case be

stayed during the loan modification process, but defendants had suggested she request

the case be dismissed without prejudice. The trial court found Harris had not filed a

request for dismissal, and therefore proceeded with the demurrer hearing.

       The court said its tentative ruling was to sustain the demurrer as to the first,

second, and fourth causes of action without leave to amend. Harris asked the court to

grant her leave to amend. Harris explained that when she filed the FAC, Shea was

involved, so Harris alleged a conspiracy between defendants and Shea, but since that

time, Harris and Shea had settled. Harris asserted she could plead facts with more

specificity regarding Countrywide and West’s representations.




                                             11
       Defendants asserted the fact that Shea was no longer a party did not change the

facts of the case. Defendants argued the appraisal was not obtained for Harris’s benefit;

rather, it was obtained for the purpose of Countrywide deciding whether to give the loan

to Harris. Moreover, defendants asserted Harris acknowledged in her loan documents

that Countrywide did not make any representations regarding the value of the property.

       Harris argued there was precedent reflecting appraisals are conducted for the

buyer’s benefit, not just the lender’s benefit. The court explained Harris’s combined

causes of action for fraud and misrepresentation did not allege (1) fraud committed by

defendants, or (2) acts outside of their role as a lender. In regard to unlawful business

practices, the court found Harris failed to allege “any unfair business practices.” As to

injunctive relief, the court found Harris failed to allege she tendered payment.

       Harris responded that tender is not required when fraud is alleged. The court

explained Harris failed to properly allege fraud in regard to defendants. Harris said she

alleged “illegality,” due to the inflated appraisal value. The court concluded Harris had

two opportunities to plead a cause of action but failed to do so. Harris again requested

leave to amend. Harris asserted she could plead the causes of action “with more

specificity,” because “[t]here is a case here.” The court again explained Harris already

had two opportunities to present a cause of action, and since Harris failed to do so, the

court concluded Harris was not able to do so. The court sustained the demurrer without

leave to amend.




                                            12
                                      DISCUSSION

       A.     MISREPRESENTATION AND FRAUD

              1.     CONTENTION

       Harris contends the trial court erred because the FAC states causes of action for

misrepresentation and fraud.

              2.     STATUTE OF LIMITATIONS

       At the outset, we address an issue we noticed during our reading of the FAC and

original complaint—the statute of limitations. The statute of limitations for a fraud

cause of action is three years. The cause of action accrues from the date of “the

discovery, by the aggrieved party, of the facts constituting the fraud . . . .” (Code of

Civ. Proc., § 338, subd. (d).) However, this tolling provision (allowing for a delay until

discovery of the fraud), requires the plaintiff to plead and prove she did not make the

discovery until within three years prior to the filing of the complaint. (Samuels v. Mix

(1999) 22 Cal.4th 1, 14.)

       The FAC reflects the appraisal report was prepared on August 24, 2007. Harris

alleged she learned of the fraud “[a]fter closing and prior to filing the action herein.”

Harris’s original complaint was filed on September 10, 2010. It is unclear exactly when

Harris learned of the fraud. If Harris learned of the fraud shortly after the appraisal

report was completed, then she has missed the statute of limitations because more than

three years passed between August 24, 2007 (the date of the appraisal report) and

September 10, 2010 (the date the original complaint was filed). Since it is unclear from




                                             13
Harris’s allegations if the statute of limitations was missed or met, we will address the

merits of Harris’s appeal.

               3.      BACKGROUND LAW

       “‘A demurrer tests the legal sufficiency of the complaint . . . .’ [Citations.] On

appeal from a dismissal after an order sustaining a demurrer, we review the order de

novo, exercising our independent judgment about whether the complaint states a cause

of action as a matter of law. [Citations.] We give the complaint a reasonable

interpretation, reading it as a whole and viewing its parts in context. [Citations.] We

deem to be true all material facts properly pled. [Citation.] We must also accept as true

those facts that may be implied or inferred from those expressly alleged. [Citation.] If

no liability exists as a matter of law, we must affirm that part of the judgment sustaining

the demurrer. [Citation.]” (Trader Sports, Inc. v. City of San Leandro (2001) 93

Cal.App.4th 37, 43.)

       “The elements of fraud that will give rise to a tort action for deceit are: ‘“(a)

misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge

of falsity (or ‘scienter’); (c) intent to defraud, i.e. to induce reliance; (d) justifiable

reliance; and (e) resulting damage.”’ [Citation.]” (Engalla v. Permanente Medical

Group, Inc. (1997) 15 Cal.4th 951, 974.) “The requirements for pleading fraud in most

cases is well established: ‘“‘fraud must be pled specifically; general and conclusory

allegations do not suffice. [Citations.]” (Morgan v. AT&T Wireless Services, Inc.

(2009) 177 Cal.App.4th 1235, 1261-1262 (Morgan).)




                                               14
              4.     MISREPRESENTATION

       In regard to the first element (false representation, concealment, or

nondisclosure), Harris asserts the FAC set forth facts reflecting defendants (1) falsely

represented there were no adverse influences affecting the property’s marketability,

(2) failed to disclose comparable sales that would have revealed lower property values,

(3) failed to disclose information regarding the downward trend of property values

across the broader real estate market, and (4) made false statements of market stability.

In sum, Harris asserts there were two false statements and two failures to disclose.

       Harris cites to paragraphs 24 and 25 of the FAC to support her contention.

Paragraph 24 provides: “According to Countrywide and/or its agents and employees

and as stated in the appraisal report prepared by the ‘approved’ appraiser on August 24,

2007, there was ‘no evidence of adverse influences affecting [the Property’s]

marketability.’”

       Paragraph 25 reflects: “After closing and prior to filing the action herein,

[Harris] discovered that the appraisal was false and that the appraiser purposefully failed

to consider comparable sales that would have revealed lower values, failed to disclose

information pertaining to the downward trending real estate market and made false

statements of market stability.”

       We now discuss the two false statement assertions. The general rule requires the

false statement be made to the plaintiff or directed toward the plaintiff. (Shapiro v.

Sutherland (1998) 64 Cal.App.4th 1534, 1547 [“it would have to have made a false

statement to plaintiff”]; see also Cohen v. Citizens Nat. Trust & Sav. Bank (1956) 143


                                            15
Cal.App.2d 480, 484.) In regard to the two false statements, the problem we encounter

is that the two paragraphs cited by Harris do not reflect the false statements were made

to or directed at Harris. It appears from paragraph 24 that Countrywide, its agents, or its

employees made a statement in an appraisal report. However, a lender generally owes

no duty of care to a borrower in preparing a property appraisal. (Nymark, supra, 231

Cal.App.3d at p. 1097.) Therefore, the fact that false information may have been

included in the property appraisal does not reflect a false statement was made to or

directed at Harris, rather, it was made to Countrywide.

       The same problem occurs with the two alleged failures to disclose information.

Harris has failed to allege that defendants had a duty to disclose the information to her.

“[T]he generally recognized rule is that absent an existing duty to volunteer

information, and notice of such duty, mere failure to disclose does not constitute fraud.

[Citations.]” (Crayton v. Superior Court (1985) 165 Cal.App.3d 443, 451.) As

explained in Nymark, a lender does not owe a duty of care to a borrower in preparing a

property appraisal. The appraisal is conducted for the purpose of allowing the lender

“to ascertain the sufficiency of the collateral as security for the loan”—it is not

conducted to assist the buyer. (Nymark, supra, 231 Cal.App.3d at p. 1097.) Therefore,

(1) the law in Nymark reflects defendants did not have a duty to disclose information to

Harris, and (2) Harris’s allegations in the two paragraphs do not reflect defendants bore

a duty to disclose information to Harris.

       The exception to the general “no duty” rule set forth in Nymark is that a lender

may owe a duty to a borrower with respect to an appraisal when the lender acts


                                             16
“‘outside the scope of the lender’s conventional role in a loan transaction.’” (Jolley v.

Chase Home Finance, LLC (2013) 213 Cal.App.4th 872, 901-902.) Harris does not set

forth this exception or explain how defendants acted outside their typical roles as

lenders. Accordingly, any argument concerning the exception is forfeited. (Boblitt v.

Boblitt (2010) 190 Cal.App.4th 603, 609 (Boblitt) [failure to provide legal argument and

citations to authorities causes the issue to be forfeited]; Advanced Choices, Inc. v.

Department of Health Services (2010) 182 Cal.App.4th 1661, 1672 (Advanced Choices)

[same].)

       We conclude the trial court properly sustained the demurrer as to the alleged

false statements because the FAC fails to reflect false statements were made to Harris or

directed at Harris. We conclude the trial court properly sustained the demurrer as to the

alleged failures to disclose because the FAC fails to reflect defendants bore a duty to

disclose the information, and the law in Nymark reflects defendants did not have a duty

toward Harris in regard to the appraisal. Since we have concluded the first element is

not met, we do not address the remaining elements.3




       3  The analysis we have conducted concerning (1) defendants not being required
to disclose information to Harris, and (2) the alleged false statements not being directed
at Harris, could likely also have fit within the elements of reliance or intent. We elected
to conduct the analysis under the misrepresentation element because, in our view, the
analysis works best within that element, where the question is whether the false
statements were made to the plaintiff, and whether there was a duty to disclose
information to the plaintiff, i.e., was there a misrepresentation involving the plaintiff.


                                            17
       Harris asserts defendants incorrectly rely upon Nymark because Nymark was

decided prior to the “‘mortgage crisis.’” Harris contends that since the mortgage crisis,

courts have rejected the conclusion that an appraisal is conducted solely for the benefit

of the lender. In support of this argument, Harris cites an opinion issued in 1981:

Larsen v. United Federal Sav. and Loan Assn. of Des Moines (Iowa 1981) 300 N.W.2d

281. In Larsen, the Supreme Court of Iowa held a lender has a duty toward the

borrower “with respect to the appraisal.” In other words, Larsen came to the opposite

conclusion of Nymark.

       Harris asserts that since Nymark was issued before the mortgage crises, it is no

longer good law. However, she supports her argument with a case that is older than

Nymark. The fact that time has passed since a decision was issued does not mean the

opinion is incorrect. Harris would need to explain why the reasoning in Nymark is

incorrect in order to clarify why the case should not be followed. Since Harris has

failed to explain why the Nymark analysis is flawed, we find her argument to be

unpersuasive. (See generally Ragland v. U.S. Bank Nat. Assn. (2012) 209 Cal.App.4th

182, 205-206 [concluding there is no duty and citing to Nymark].)

       Next, Harris contends that regardless of an appraisal being conducted solely for

the lender’s benefit, the lender still has a duty to provide the buyer with an accurate

appraisal “under California law.” Harris does not identify what law, if any, supports her

assertion. Since Harris has not provided law in support of this argument, we deem the

argument to be forfeited. (Boblitt, supra, 190 Cal.App.4th at p. 609; Advanced Choices,

supra, 182 Cal.App.4th at p. 1672.)


                                            18
               5.     AMENDMENT

        In the alternative, Harris asserts the trial court should have granted her leave to

amend the FAC.

        If the defect in the complaint can be cured by amendment, then the judgment of

dismissal must be reversed to allow the plaintiff an opportunity to amend. “The

plaintiff bears the burden of demonstrating a reasonable possibility to cure any defect by

amendment. [Citations.] A trial court abuses its discretion if it sustains a demurrer

without leave to amend when the plaintiff shows a reasonable possibility to cure any

defect by amendment. [Citations.] If the plaintiff cannot show an abuse of discretion,

the trial court’s order sustaining the demurrer without leave to amend must be affirmed.

[Citation.]” (Traders Sports, Inc. v. City of San Leandro, supra, 93 Cal.App.4th at pp.

43-44.)

        In her appellant’s opening brief, Harris does not provide any detail regarding

how she would amend the FAC to cure the defects. However, from the documents at

the lower court and arguments in her appellant’s reply brief, we infer Harris would

amend the FAC to reflect an employee of Countrywide, West, told Harris that if the

property appraised for less than the agreed-upon purchase price, then Harris would not

be obligated to purchase the property. Harris would further allege Countrywide owed a

duty to Harris in the preparation of the appraisal, based upon the foregoing statement by

West.

        The problem with this proposed amendment is that it does not create an inference

that Countrywide owed a duty to Harris in the preparation of the appraisal. Rather, the


                                              19
logical inference to be made from West’s statement is that if the appraisal reflected the

property were worth less than the purchase price that Harris had already agreed upon

with Shea, then her requested loan amount would not be fully funded by Countrywide

(because the property was not found to be adequate security for the loan), and therefore,

Harris would be able to cancel the purchase agreement because she would not have

sufficient funds to proceed with the agreement.

       In other words, the statement does not create an inference of a duty owed by

Countrywide to Harris. Rather, West’s statement further supports the conclusion that

the appraisal was conducted only for the lender’s benefit—for the lender to determine if

the property was adequate security, because if it were inadequate, the loan would not be

fully funded. There is nothing in the proposed amendment that would cure the defects

in the FAC. Harris has still failed to show (1) the alleged false statements were made to

her or directed at her, and (2) defendants had a duty to volunteer information to Harris.

       There is a rule regarding indirect deception, which provides a defendant may be

liable for false statements that are not made directly to the plaintiff, but which are made

to a third person and the speaker/writer of the statement intends or has reason to expect

that the substance of the misrepresentation will be communicated to the plaintiff and

that the misrepresentation will influence her conduct in the transaction at issue.

(Geernaert v. Mitchell (1995) 31 Cal.App.4th 601, 605-606.)

       When applying the indirect deception rule, the same problem described ante,

appears. West’s statement does not reflect an intent or expectation for Harris to be

influenced by the appraisal. Rather, the logical inference from West’s statement is that


                                            20
Harris would be able to cancel the purchase agreement because she would not have

sufficient funds after Countrywide relied upon (or was influenced by) the appraisal and

possibly refused to fully fund the loan for the purchase price that Harris had already

agreed upon, thus leaving Harris without the funds to complete the transaction. In other

words the logical inference from West’s statement and the allegations in the FAC do not

reflect the information in the appraisal was meant to indirectly influence Harris.

Accordingly, we conclude the trial court did not err by denying Harris leave to amend

on the combined fraud and misrepresentation causes of action because Harris has not

show the statements were (1) made to her, (2) directed toward her, or (3) designed to

indirectly influence her.

       B.     SECTION 17200

              1.     CONTENTION

       Harris contends the trial court erred by sustaining the demurrer because the FAC

states a cause of action for unlawful, unfair, or fraudulent business practices. (§ 17200.)

              2.     BACKGROUND LAW

       Section 17200 et seq. is known as the Unfair Competition Law (UCL). (Morgan,

supra, 177 Cal.App.4th at p. 1240.) “The UCL outlaws as unfair competition ‘any

unlawful, unfair or fraudulent business act or practice . . . . Because the statute is

framed in the disjunctive, a business practice need only meet one of the three criteria to

be considered unfair competition. [Citation.]’ [Citation.]” (Id. at p. 1253.)




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              3.     UNLAWFUL BUSINESS PRACTICE

       Harris contends the FAC sets forth a cause of action for an unlawful business

practice. In particular, Harris asserts the FAC reflects defendants violated Civil Code

section 1090.5.

       “An unlawful business practice under the UCL is ‘“‘“anything that can properly

be called a business practice and that at the same time is forbidden by law.”’”’

[Citation].” (Morgan, supra, 177 Cal.App.4th at p. 1254.) Civil Code section 1090.5,

subdivision (a) provides, in relevant part: “No person with an interest in a real estate

transaction involving a valuation shall improperly influence or attempt to improperly

influence the development, reporting, result, or review of that valuation, through

coercion, extortion, bribery, intimidation, compensation, or instruction.”

       Defendants assert they did not have an interest in Harris’s real estate transaction.

However, defendants fail to define the phrase “‘[a] person with an interest in a real

estate transaction.”” Rather, they merely assert Harris has failed to show defendants

had the required interest, whatever those requirements may be. Harris does not explain

how or why defendants had an interest in the real estate transaction. Rather, Harris

simply asserts defendants “had an interest in [Harris’s] real estate transaction.” No

explanation or legal definition of the phrase is provided.

       The issue presented is: Does a lender qualify as an interested person in a real

estate transaction. The parties have provided differing conclusions without law or legal

analysis in support of their conclusions. Since the parties have not provided any law on

what it means to be a “person with an interest in a real estate transaction,” and have not


                                            22
provided any legal argument on this point, we cannot determine whether defendants

meet the statutory requirements. As a result, we deem this issue forfeited for failure to

provide law and legal arguments. (Boblitt, supra, 190 Cal.App.4th at p. 609; Advanced

Choices, supra, 182 Cal.App.4th at p. 1672.)

              4.     FRAUDULENT BUSINESS PRACTICE

       Harris contends the trial court erred by sustaining the demurrer in regard to her

allegations of a fraudulent business practice because UCL-fraud claims do not have to

be pled with the specificity of common law fraud claims. Harris is correct that UCL

fraud claims can properly be pled with less specificity than a common law fraud claim.

(Committee on Children’s Television, Inc. v. General Foods Corp., supra, 35 Cal.3d at

pp. 212-213; Morgan, supra, 177 Cal.App.4th at p. 1256.) However, Harris fails to

explain how, under the UCL, she has properly pled a cause of action for fraudulent

business practices. The law reflecting that the pleading requirements are diminished

does not repair the deficiencies in Harris’s FAC. Since Harris fails to provide a legal

argument regarding how her UCL-fraud allegations are sufficient, we deem the issue to

be forfeited. (Boblitt, supra, 190 Cal.App.4th at p. 609; Advanced Choices, supra, 182

Cal.App.4th at p. 1672.)

              5.     UNFAIR BUSINESS PRACTICE

       Next, Harris asserts the FAC sets forth facts sufficient to support a cause of

action for an unfair business practice. Specifically, Harris contends the FAC reflects an

unfair business practice because defendants (1) improperly influenced appraisers to

inflate property values, (2) improperly influenced appraisers to prepare appraisals that


                                            23
were tainted with false and misleading information, (3) used appraisers who did not

disclose information that would have reflected lower property values and market

instability, and (4) violated regulatory standards for professional appraisers.

       There is currently a split of authority concerning the definition of an unfair

business practice. (Klein v. Chevron U.S.A., Inc. (2012) 202 Cal.App.4th 1342, 1376,

fn. 14; Morgan, supra, 177 Cal.App.4th at pp. 1254-1255.) “Before 1999, some Courts

of Appeal held that ‘an “unfair” business practice occurs when it offends an established

public policy or when the practice is immoral, unethical, oppressive, unscrupulous or

substantially injurious to consumers’ [citations], while others held that the

determination whether a practice is unfair ‘involves an examination of [that practice’s]

impact on its alleged victim, balanced against the reasons, justifications and motives of

the alleged wrongdoer’ [citations].

       “In 1999, the Supreme Court defined ‘unfair’ in the context of a UCL action by

one competitor against a direct competitor, stating that ‘any finding of unfairness to

competitors under [the UCL must] be tethered to some legislatively declared policy or

proof of some actual or threatened impact on competition.’ [(Cel-Tech

Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20 Cal.4th 163,

186-187.)] But the Supreme Court also made clear that its discussion about ‘unfair’

practices was limited to actions by competitors alleging anticompetitive practices, and

did not relate to actions by consumers. [Citation.] Nevertheless, some courts of appeal

have applied the Cel-Tech definition of ‘unfair’ to consumer actions [citations], while

others . . . have applied the old definitions [citations]. . . . [I]n Camacho v. Automobile


                                             24
Club of Southern California (2006) 142 Cal.App.4th 1394, a consumer action, Division

Eight of [the Second] [A]ppellate [D]istrict rejected both definitions and instead applied

a definition based upon section 5 of the Federal Trade Commission Act [citation].

Under the definition in Camacho, a practice is unfair if (1) the consumer injury is

substantial, (2) the injury is not outweighed by any countervailing benefits to consumers

or competition, and (3) the injury is one that consumers themselves could not

reasonably have avoided. [Citation.]” (Morgan, supra, 177 Cal.App.4th at pp. 1254-

1255.)

         In Harris’s appellant’s opening brief, she cites both pre-1999 rules: (1) the

determination of an unfair practice involves examining the practice’s impact on the

alleged victim, balanced against the reasons, justifications and motives of the alleged

wrongdoer (Motors, Inc. v. Times Mirror Co. (1980) 102 Cal.App.3d 735, 740 [Second

Dist., Div. Five]); and (2) the determination requires examining whether the practice

offends an established public policy or if the practice is immoral, unethical, oppressive,

unscrupulous or substantially injurious to consumers (People v. Casa Blanca

Convalescent Homes, Inc. (1984) 159 Cal.App.3d 509, 530 [Fourth Dist., Div. One]).

(See Morgan, supra, 177 Cal.App.4th at pp. 1254 [discussing the different rules in

Motors and Casa Blanca].)

         Harris does not reconcile the rules or explain which of the two pre-1999 rules she

would like this court to follow. Harris does not discuss Cel-Tech or present the split in

authority following the Cel-Tech decision in 1999. Since Harris presents two different

pre-1999 rules, without legal argument concerning which rule is correct, we determine


                                              25
this issue has been forfeited, because we cannot analyze the issue unless we know

which rule of law to apply. (Boblitt, supra, 190 Cal.App.4th at p. 609; Advanced

Choices, supra, 182 Cal.App.4th at p. 1672.)

              6.     AMENDMENT

       In the alternative, Harris asserts the trial court should have granted her leave to

amend her fourth cause of action. Harris does not provide any information regarding

how she would amend the FAC. (See Holcomb v. Wells Fargo Bank, N.A. (2007) 155

Cal.App.4th 490, 495 [“‘Plaintiff must show in what manner he can amend his

complaint and how that amendment will change the legal effect of his pleading’”].)

Accordingly, we conclude the issue has been forfeited for failure to provide a legal

argument. (Boblitt, supra, 190 Cal.App.4th at p. 609; Advanced Choices, supra, 182

Cal.App.4th at p. 1672.)

       C.     TENDER

       Defendants assert Harris’s request for injunctive relief fails because a person

must offer to tender the amount due on the mortgage in order to successfully have a

court rescind a mortgage and issue an injunction stopping a trustee’s sale. (Civ. Code,

§ 2905.) Harris’s request for injunctive relief was made in connection with the fourth

cause of action—the alleged violation of Business and Professions Code section 17200.

We have not found an error in the trial court’s order sustaining the demurrer without

leave to amend, which includes the fourth cause of action. Therefore, we do not analyze

this issue because it is moot, in that we have already concluded the trial court properly




                                             26
dismissed the fourth cause of action. (Amaral v. Cintas Corp. No. 2 (2008) 163

Cal.App.4th 1157, 1215 [an issue is moot when no effective relief can be granted].)

                                     DISPOSITION

      The judgment is affirmed. Respondents are awarded their costs on appeal.

      NOT TO BE PUBLISHED IN OFFICIAL REPORTS



                                                     MILLER
                                                                                      J.


We concur:


RICHLI
                      Acting P. J.


CODRINGTON
                                J.




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