                                                                   FILED
                                                                March 17, 2016
                                                         In the Office of the Clerk of Court
                                                        WA State Court of Appeals, Division Ill




         IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
                            DIVISION THREE

JAMES C. BLAIR, II,                           )        No. 32816-3-111
                                              )
                     Appellant,               )
                                              )
              v.                              )
                                              )
NORTHWEST TRUSTEE SERVICES,                   )        PUBLISHED OPINION
INC., BANK OF AMERICA, N.A.,                  )
MORTGAGE ELECTRONIC                           )
REGISTRATION SYSTEMS, INC.,                   )
FEDERAL HOME LOAN MORTGAGE                    )
CORPORATION and DOE                           )
DEFENDANTS 1 through 20,                      )
                                              )
                     Respondents.             )

       LAWRENCE-BERREY, J. -      James C. Blair appeals the trial court's summary

judgment dismissal of his Consumer Protection Act (CPA), chapter 19.86 RCW, and

misrepresentation claims against the respondents. Mr. Blair's claims arise out of a

nonjudicial foreclosure proceeding initiated against his residential property. Mr. Blair

predicates his CPA claims on asserted violations of the Deed of Trust Act (DTA), chapter

61.24 RCW. We hold that Northwest Trustee Services, Inc. (NWTS) violated the DTA

when it relied on an ambiguous beneficiary declaration, but that Mr. Blair failed to
No. 32816-3-111
Blair v. Nw. Trustee Servs.


establish that NWTS's violation was causally linked to any injury he suffered. We

additionally hold that Mr. Blair's misrepresentation claims lack a factual basis. We

therefore affirm the trial court.

                                         FACTS

       In September 2008, James Blair refinanced his mortgage with Countrywide Bank,

FSB (Countrywide). Mr. Blair signed a promissory note and a deed of trust that

encumbered his Chelan County residence. The deed of trust identifies Land America as

the original trustee, Countrywide as the lender, and Mortgage Electronic Registration

Systems, Inc. (MERS) as the deed of trust beneficiary. The note likewise identifies

Countrywide as the lender, and is endorsed in blank by Countrywide. In August 2010,

Mr. Blair became delinquent on his mortgage payments. While Mr. Blair was seeking a

loan modification and was more than $34,000 behind on monthly payments, Bank of

America, N.A. (BoA) initiated nonjudicial foreclosure proceedings in spring 2012.

       According to the Federal Home Loan Mortgage Corporation's (Freddie Mac's)

website, it became the owner of Mr. Blair's "mortgage" on September 25, 2008. Clerk's

Papers (CP) at 698. BoA has physically possessed Mr. Blair's note "for the benefit of

Freddie Mac and in accordance with Freddie Mac guidelines" since that time. CP at

1142. Freddie Mac routinely enters into agreements where home loan promissory notes it



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Blair v. Nw. Trustee Servs.


has bought are physically placed in the possession of a document custodian, who may also

be the loan servicer. Under Freddie Mac's document custody procedures handbook, the

primary duty of the document custodian is to "[h]old Notes and assignments in trust for

the sole benefit of Freddie Mac." CP at 1046. Consequently, Freddie Mac and the

document custodian "[ d]o not enter into any understanding, agreement or relationship

with any party to obtain, retain or claim any interest, including ownership or security, in

Mortgages owned by Freddie Mac, unless specifically approved in writing, in advance."

CP at 1046.

       BoA serviced Mr. Blair's loan for Freddie Mac and was authorized "to take all

actions necessary for the collection and enforcement of the Loan, including receiving and

processing loan payments, communicating with [sic] regarding the loan, and, should such

action be necessary, initiating foreclosure, consistent with the Note, Deed of Trust and

Freddie Mac servicing guidelines." CP at 853.

       After Mr. Blair became delinquent on his payments in August 2010, he applied for

a loan modification through BoA in 2011 and early 2012. BoA rejected Mr. Blair's

application on the asserted basis that he failed to provide the required documents.· Prior to

the initiation of the nonjudicial foreclosure proceedings, MERS assigned its interest in

Mr. Blair's deed of trust to BoA. In a document dated October 18, 2011, BoA appointed



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Blair v. Nw. Trustee Servs.


NWTS as the successor trustee of Mr. Blair's deed of trust. The document appointing

NWTS as the successor trustee refers to BoA as the beneficiary, and was publicly

recorded in March 2012.

          In March 2012, NWTS issued a notice of default to Mr. Blair. The notice of

default states "[t]he owner of this note is Federal Home Loan Mortgage Corporation

(Freddie Mac)" and "[t]he loan servicer for this loan is Bank of America, N.A." CP at

925. In April 2012, NWTS issued and recorded a notice of trustee's sale, setting a

foreclosure date in August 2012. Prior to issuing the notice of trustee's sale, NWTS

received a beneficiary declaration from BoA that it relied on. The beneficiary declaration

stated:

          [BoA] is the beneficiary (as defined by RCW §61.24.005(2)) and actual
          holder of the promissory note or other obligation secured by the deed of
          trust or has requisite authority under the RCW 62A.3-301 to enforce said
          obligation for the above mentioned loan account.

CP at 566 (emphasis added).

          Shortly before the scheduled trustee's sale, Mr. Blair filed this lawsuit, naming

NWTS, BoA, MERS, and Freddie Mac as defendants. In his complaint, Mr. Blair sought

(1) a temporary restraining order (TRO) and preliminary injunction prohibiting the

trustee's sale, (2) damages under the DTA against NWTS, (3) damages under the CPA

against all defendants, and (4) damages resulting from intentional or negligent

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Blair v. Nw. Trustee Servs.


misrepresentation against all defendants. The crux of Mr. Blair's complaint was that the

defendants misrepresented BoA as the DTA beneficiary, and because BoA was not the

DTA beneficiary, it had no lawful authority to appoint N\VTS as the successor trustee,

and therefore the entire nonjudicial foreclosure was unlawful.

       Mr. Blair incurred attorney fees of $5,350.00 in enjoining the trustee's sale.

Additionally, Mr. Blair estimated that he incurred costs totaling $890.35 associated with

the TRO and preliminary injunction, including missing work at the title insurance

company he owns and operates. According to Mr. Blair's counsel, she has brought at

least 10 cases against NWTS in the last few years containing similar allegations (and is

aware of other attorneys doing the same).

      NWTS moved for summary judgment in November 2013, arguing that it complied

with the DTA by relying on BoA' s beneficiary declaration, and that BoA was the note

holder and DTA beneficiary with the power to appoint the successor trustee. NWTS also

argued that any damages Mr. Blair incurred were proximately caused by his failure to

make his home loan payments, and that he cannot prove he suffered "actual prejudice"

relating to the nonjudicial foreclosure. BoA, MERS, and Freddie Mac (represented by the

same counsel) also moved for summary judgment in November 2013, similarly arguing

that BoA was the DTA beneficiary with the authority to appoint NWTS as the successor



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Blair v. Nw. Trustee Servs.


trustee. Mr. Blair opposed both summary judgment motions, arguing that the DTA only

allows a beneficiary who is also the owner of the note to initiate nonjudicial foreclosure.

During the summary judgment hearing, Mr. Blair argued that BoA's beneficiary

declaration was also insufficient because BoA had not proved it was in physical

possession of the note when the beneficiary declaration was prepared. Consequently, the

trial court allowed BoA to submit a supplemental declaration. The supplemental

declaration shows that BoA had physical possession of the note at the time the beneficiary

declaration was prepared.

       The trial court granted summary judgment to all of the defendants. In a

memorandum decision, the trial court stated that BoA "actually held the note" based on

the "supplemental declaration establishing that it held the note continuously beginning

September 25, 2008 as the successor to BAC Home Loans." CP at 1148. The trial court

further held that although BoA's beneficiary declaration to NWTS was "insufficient" on

its face, BoA "supplemented the record to establish that it in fact held the requisite

documents at all relevant times to the attempted foreclosure in this case." CP at 1149.

Therefore, BoA "had the authority to appoint N\YTS as a successor trustee." CP at 1149.

As the trial court concluded that the DTA claim should be dismissed, it likewise

dismissed the CPA claim as it was predicated on the alleged DTA violation. Similarly,


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Blair v. Nw. Trustee Servs.


the intentional and negligent misrepresentation claims were dismissed as "plaintiff has

failed to establish a material false representation by any of the defendants that plaintiff

relied on and proximately caused him damage." CP at 1150. Mr. Blair timely appeals.

                                        ANALYSIS

A.     Standard of review

       This court reviews an order granting summary judgment de novo. Lyons v. US.

Bank NA, 181 Wn.2d 775, 783, 336 P.3d 1142 (2014). Under de novo review, this court

engages in the same inquiry as the trial court, viewing the facts and all reasonable

inferences in the light most favorable to the nonmoving party. Id. (quoting State v. Reid,

136 Wn.2d 195, 201, 961 P.2d 333 (1998)). "The object and function of summary

judgment procedure is to avoid a useless trial." Barber v. Bankers Life & Cas. Co., 81

Wn.2d 140, 144, 500 P.2d 88 (1972).

       Summary judgment is appropriate only if the record demonstrates there is no

genuine issue of material fact and the moving party is entitled to judgment as a matter of

law. CR 56(c). Judgment as a matter oflaw for summary judgment purposes is

warranted "if reasonable people could reach one conclusion based on the evidence when

viewing the facts in the light most favorable to the nonmoving party." O.S. T v. Regence

BlueShield, 181 Wn.2d 691, 703, 335 P.3d 416 (2014). "A material fact is one upon


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No. 32816-3-111
Blair v. Nw. Trustee Servs.


which the outcome of the litigation depends in whole or in part." Atherton Condo. Apt.-

Owners Ass 'n Bd. ofDirs. v. Blume Dev. Co., 115 Wn.2d 506, 516, 799 P .2d 250 ( 1990).

"A trial is not useless, but is absolutely necessary where there is a genuine issue as to any

material fact." Barber, 81 Wn.2d at 144.

       The initial burden is on the moving party to show there is no genuine issue of any

material fact. CR 56(e). "The burden then shifts to the nonmoving party to set forth

specific facts demonstrating a genuine issue for trial." Am. Express Centurion Bank v.

Stratman, 172 Wn. App. 667, 673, 292 P.3d 128 (2012). "Mere allegations or conclusory

statements of facts unsupported by evidence are not sufficient to establish a genuine

issue." Rucker v. NovaStar Mortg., Inc., 177 Wn. App. 1, 10, 311 P.3d 31 (2013). This

court "may affirm summary judgment on any grounds supported by the record." Blue

Diamond Grp., Inc. v. KB Seattle 1, Inc., 163 Wn. App. 449, 453, 266 P.3d 881 (2011).

B.    DTA overview

      "The DTA sets up a three party system for mortgages where an independent trustee

acts as the impartial party between a lender and a borrower instead of the court." Lyons,

181 Wn.2d at 786. A statutory deed of trust is essentially an "equitable mortgage" as it

conveys title to the trustee to secure the home loan. Walker v. Quality Loan Serv. Corp.,

176 Wn. App. 294, 305, 308 P.3d 716 (2013). "When secured by a deed of trust that



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No. 32816-3-III
Blair v. Nw. Trustee Servs.


grants the trustee the power of sale if the borrower defaults on repaying the under lying

obligation, the trustee may usually foreclose the deed of trust and sell the property

withoutjudicial supervision." Bain v. Metro. Mortg. Grp., Inc., 175 Wn.2d 83, 93, 285

PJd 34 (2012). The DTA strives to serve three main policies: (1) '"the nonjudicial

foreclosure process should remain efficient and inexpensive,'" (2) "' the process should

provide an adequate opportunity for interested parties to prevent wrongful foreclosure,' "

and (3) "' the process should promote the stability of land titles.'" Id. at 94 (quoting Cox

v. Helenius, 103 Wn.2d 383, 387, 693 P.2d 683 (1985)).

       When construing a statute, this court's "goal is to determine and effectuate

legislative intent." Swinomish Indian Tribal Cmty. v. Dep 't of Ecology, 178 Wn.2d 571,

581, 311 PJd 6 (2013). First, this court must "give effect to the plain meaning of the

language used as the embodiment of legislative intent" where possible. Id. Second,

"when technical terms and terms of art are used," this court "give[s] these terms their

technical meaning." Id. Importantly, the DTA '"must be construed in favor of borrowers

because of the relative ease with which lenders can forfeit borrowers' interests and the

lack of judicial oversight in conducting nonjudicial foreclosure sales.'" Bain, 17 5 Wn.2d

at 93 (quoting Udall v. TD. Escrow Servs., Inc., 159 Wn.2d 903, 915-16, 154 PJd 882

(2007)).



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Blair v. Nw. Trustee Servs.


C.     CPA liability

       Mr. Blair acknowledges that he is not entitled to bring direct claims for pre-

foreclosure violations of the DTA. He therefore asserts that the respondents are liable

under the CPA for DTA violations.

       The CPA prohibits "[ u]nfair methods of competition and unfair or deceptive acts

or practices in the conduct of any trade or commerce." RCW 19.86.020. "To succeed on

a CPA claim, a plaintiff must establish (I) an unfair or deceptive act (2) in trade or

commerce (3) that affects the public interest, (4) injury to the plaintiff in his or her

business or property, and (5) a causal link between the unfair or deceptive act complained

of and the injury suffered." Trujillo v. Nw. Trustee Servs., Inc., 183 Wn.2d 820, 834-35,

355 P.3d 1100 (2015).

       1.      Unfair or deceptive act

       Under the first element, "[w ]hether an act is unfair or deceptive is a question of

law." Id. at 835. Misrepresenting one's authority as the DTA beneficiary has the

capacity to deceive and is therefore an unfair or deceptive act. Bain, 175 Wn.2d at 117.

Here, Mr. Blair alleges that respondents misrepresented BoA's status as the DTA

beneficiary.




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Blair v. Nw. Trustee Servs.


       In addition, a trustee's failure to follow the nonjudical foreclosure procedures of

the DTA constitutes an unfair or deceptive act. Lyons, 181 Wn.2d at 787. Here, Mr.

Blair alleges that NWTS failed to follow the DTA when it relied on an improper

beneficiary declaration.

              a.     Status ofBoA as beneficiary

       The DTA beneficiary has the power to appoint a successor trustee and to instruct

the trustee to initiate nonjudicial foreclosure. RCW 61.24.010(2); .020; .030. According

to the DTA definitions, a "beneficiary" is "the holder of the instrument or document

evidencing the obligations secured by the deed of trust." RCW 61.24.005(2).

       Washington's version of the Uniform Commercial Code (UCC), Title 62A RCW,

guides the interpretation of what constitutes a holder under the RCW 61.24.005(2)

definition of "beneficiary." Bain, 175 Wn.2d at 104. Providing the commercial

background, the Bain court stated:

       Traditionally, the "beneficiary" of a deed of trust is the lender who has
       loaned money to the homeowner . . . . Lenders, of course, have long been
       free to sell that secured debt, typically by selling the promissory note signed
       by the homeowner. [The DTA] recognizes that the beneficiary of a deed of
       trust at any one time might not be the original lender. The act gives .
       subsequent holders of the debt the benefit of the act by defining
       "beneficiary" broadly ....




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Blair v. Nw. Trustee Servs.


Id. at 88. When the note is sold, "the security instrument will follow the note, not the

other way around." Id. at 104.

       Based on "[a] plain reading of the statute," the Bain court concluded "that only the

actual holder of the promissory note or other instrument evidencing the obligation may be

a beneficiary with the power to appoint a trustee to proceed with a nonjudicial foreclosure

on real property." Id. at 89. Specifically, the Bain court held that MERS could not be a

DTA "beneficiary" as "a beneficiary must either actually possess the promissory note or

be the payee." Id. at 104 (emphasis added). "Bain thus recognized that holding the note

· is essential to beneficiary status." Brown v. Dep'to/Commerce, 184 Wn.2d 509, 539,

359 P.3d 771 (2015).

       Washington's UCC defines "holder" as "[t]he person in possession of a negotiable

instrument that is payable either to bearer or to an identified person that is the person in

possession." RCW 62A.1-201(21)(A); see RCW 62A.3-201. If indorsed in blank, the

note "becomes payable to bearer and may be negotiated by transfer of possession alone."

RCW 62A.3-205(b ).

       In Brown, the Supreme Court of Washington recently held that the holder of the

note under article 3 of the UCC was the DTA beneficiary, despite Freddie Mac owning




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Blair v. Nw. Trustee Servs.


the beneficial interest of the note. Brown, 184 Wn.2d at 514-15. The Brown court

provided background on Freddie Mac's involvement in the home loan industry:

               Freddie Mac does not lend to homebuyers. Instead, Freddie Mac
       purchases mortgage notes from the initial lenders. Often, Freddie Mac
       pools hundreds of these mortgage notes into a trust, and the trustee issues
       and sells securities to investors in various tranches of seniority .... Freddie
       Mac guarantees the borrowers' monthly payments on the underlying notes.
       If a borrower stops paying, Freddie Mac will step in and pay the investors.
       Freddie Mac does all of this to further its congressionally mandated mission
       to "provide ongoing assistance to the secondary market for residential
       mortgages" to thereby "promote access to mortgage credit throughout the
       Nation" and expand homeownership. 12 U.S.C. § 1716(3), (4).

Id. at 521. When Freddie Mac purchases a note, it authorizes the servicer to collect on the

note, negotiate modifications, and foreclose on the note if necessary. Id. at 521-22.

"Before the servicer institutes foreclosure proceedings, Freddie Mac provides the servicer

with actual or constructive possession of the original note." Id. at 523.

       The Brown court stated that the definition of "holder" in RCW 62A.1-201(21)(A)

"does not tum on ownership," and "focuses on the party who possesses the note in order

to protect the borrower from being sued fraudulently or by multiple parties on the same

note." Id. at 525-26; accord John Davis & Co. v. Cedar Glen# Four, Inc., 75 Wn.2d

214, 222-23, 450 P.2d 166 (1969) ("The holder of a negotiable instrument may sue

thereon in his own name, and payment to him in due course discharges the instrument. ...

It is not necessary for the holder to first establish that he has some beneficial interest in

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Blair v. Nw. Trustee Servs.


the proceeds."). The court noted that "[the servicer] is the holder of [the] note because

[the servicer] possesses the note and because the note, having been indorsed in blank, is

payable to bearer." Brown, 184 Wn.2d at 535-36. Consequently, the Brown court

concluded that the servicer in possession of the note indorsed in blank was the DTA

beneficiary. Id. at 540.

       Here, prior to the initiation of the nonjudicial foreclosure, BoA physically

possessed Mr. Blair's note indorsed in blank. A note indorsed in blank is payable to its

bearer. RCW 62A.3-205(b ). BoA became the holder by virtue of physically possessing

Mr. Blair's note indorsed in blank. RCW 62A.l-201(2l)(A); see RCW 62A.3-201. For

the first time at the summary judgment hearing, Mr. Blair attempted to dispute whether

BoA physically possessed the note. However, "[m]ere allegations or conclusory

statements of facts unsupported by evidence are not sufficient to establish a genuine

issue." Rucker, 177 Wn. App. at 10. We therefore conclude that there is no issue of

material fact disputing BoA's possession of Mr. Blair's note.

       Mr. Blair argues that BoA is not the DTA beneficiary, and is only a document

custodian, as it holds the note for Freddie Mac's benefit and follows Freddie Mac's

guidelines. However, the Supreme Court of Washington in Brown rejected the argument

that the DTA beneficiary must also be the owner of the note. Brown, 184 Wn.2d 509.


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Blair v. Nw. Trustee Servs.


Moreover, BoA stated that it was authorized to take actions that a beneficiary would take,

such as collecting on the note and initiating nonjudicial foreclosure. Because actual

physical possession of the original note indorsed in blank conveys holder status under

Washington law, Mr. Blair has not raised a genuine issue of fact regarding BoA's status

as the DTA beneficiary. See Bain, 175 Wn.2d at 104; see also Brown, 184 Wn.2d 509.

As a matter of law, because BoA was the beneficiary, the respondents did not

misrepresent BoA's DTA beneficiary status, and Mr. Blair has failed to establish CPA

liability against any of the respondents based on his first argument.

              b. NWTS 's reliance on a defective beneficiary declaration

       Under the DTA, the trustee is tasked with conducting the nonjudicial foreclosure.

RCW 61.24.040. However, "' a trustee is not merely an agent for the lender or the

lender's successors."' Lyons, 181 Wn.2d at 787 (quoting Bain, 175 Wn.2d at 93).

Although not rising to the level of a fiduciary duty, "[t]he trustee or successor trustee has

a duty of good faith to the borrower, beneficiary, and grantor." RCW 61.24.010(4). '" A

foreclosure trustee must "adequately inform" itself regarding the purported beneficiary's

right to foreclose, including, at a minimum, a "cursory investigation" to adhere to its duty

of good faith."' Trujillo, 183 Wn.2d at 831-32 (quoting Lyons, 181 Wn.2d at 787).




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       The requisites of a trustee's sale are set forth in RCW 61.24.030. Pertinent to this

court's analysis, RCW 61.24.030(7)(a) provides:

       That, for residential real property, before the notice of trustee's sale is
       recorded, transmitted, or served, the trustee shall have proof that the
       beneficiary is the owner of any promissory note or other obligation secured
       by the deed of trust. A declaration by the beneficiary made under the
       penalty of perjury stating that the beneficiary is the actual holder of the
       promissory note ... shall be sufficient proof as required under this
       subsection.

The trustee is entitled to rely on the beneficiary's declaration unless it has violated its

duty of good faith. RCW 61.24.030(7)(b ); see Lyons, 181 Wn.2d at 790 ("if there is an

indication that the beneficiary declaration might be ineffective, a trustee should verify its

veracity before initiating a trustee's sale to comply with its statutory duty").

       The Trujillo court discussed the first sentence ofRCW 61.24.030(7)(a). It

reiterated that a trustee must "have proof that the beneficiary actually owns the note on

which the trustee is foreclosing." Trujillo, 183 Wn.2d at 832. "A trustee must have the

requisite proof of the beneficiary's ownership of the note before recording, transmitting,

or serving the notice of trustee's sale." Id. at 834 n.10.

       The Trujillo court also discussed the second sentence ofRCW 61.24.030(7)(a).

The Trujillo court held that its recent decision in Lyons was dispositive. Trujillo, 183

Wn.2d at 833. In Lyons, the beneficiary declaration stated, "'Wells Fargo Bank, NA, is


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No. 32816-3-111
Blair v. Nw. Trustee Servs.


the actual holder of the promissory note ... or has requisite authority under RCW 62A.3-

301 to enforce said [note]."' Lyons, 181 Wn.2d at 780 (emphasis added). The Lyons

court reasoned:

       On its face, [the beneficiary declaration] is ambiguous whether the
       declaration proves [the purported beneficiary] is the holder or whether [the
       purported beneficiary] is a nonholder in possession or person not in
       possession who is entitled to enforce the provision under RCW 62A.3-301.
       But [the trustee] can still prove that [the purported beneficiary] was the
       owner of the note in a way other than through the beneficiary declaration
       referenced in RCW 61.24.030(7)(a). Thus, there remains a material issue of
       fact as to whether [the purported beneficiary] was the owner prior to
       initiating the trustee's sale. [The trustee] will need to furnish that proof but
       may not just rely on this ambiguous declaration.

Id. at 791.

       Here, BoA' s beneficiary declaration stated that it "is the beneficiary (as defined by

RCW §61.24.005(2)) and actual holder of the promissory note or other obligation secured

by the deed of trust or has requisite authority under the RCW 62A.3-301 to enforce said

obligation for the above mentioned loan account." CP at 515 (emphasis added). As

acknowledged by the trial court, and consistent with Trujillo and Lyons, NWTS cannot

satisfy its DTA duties by relying on this ambiguous beneficiary declaration.

       The trial court allowed BoA to file a supplemental declaration. The supplemental

declaration stated that BoA had held the promissory note for all times relevant. Based on

this, the trial court excused NWTS's violation. In doing so, the trial court erred.

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No. 32816-3-III
Blair v. Nw. Trustee Servs.


The supplemental declaration came after the fact, and NWTS had to comply with

RCW 61.24.030(7)(a)'s proof requirement "before recording, transmitting, or serving the

notice oftrustee's sale." Trujillo, 183 Wn.2d at 834 n.10. Because NWTS relied on the

ambiguous beneficiary declaration prior to recording, transmitting, or serving the notice

of trustee's sale, it violated RCW 61.24.030(7)(a).

       2.    Injury to the plaintiff in his business or property

      NWTS argues that Mr. Blair cannot satisfy the injury element of his CPA claim.

"Because the CPA addresses 'injuries' rather than 'damages,' quantifiable monetary loss

is not required." Frias v. Asset Foreclosure Servs. Inc., 181 Wn.2d 412, 431, 334 P.3d

529 (2014). "The injury element does not require that the homeowner lose their property

in order to bring a claim under the CPA." Lyons, 181 Wn.2d at 786 n.4. Further an

"injury" can be based on unlawful collection practices even where there is no dispute as

to the validity of the underlying debt, and the element "can be met even where the injury

alleged is both minimal and temporary." Frias, 181 Wn.2d at 431. Consequently,

attorney fees and costs incurred in enjoining a wrongful trustee's sale may qualify as an

"injury" under the CPA. See Trujillo, 183 Wn.2d at 837 ("investigation expenses and

other costs associated with dispelling the uncertainty about who owns the note" are

sufficient); see also Panag v. Farmers Ins. Co. of Wash., 166 Wn.2d 27, 62-63, 204 P.3d


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No. 32816-3-111
Blair v. Nw. Trustee Servs.


885 (2009) (costs to consult an attorney, resulting from a deceptive business practice,

establish injury). We conclude that Mr. Blair has satisfied the injury element of his CPA

claim by virtue of his expenditure of attorney fees and costs associated with investigating

NWTS's authority to initiate foreclosure proceedings.

       3.     Causal link between the unfair or deceptive act complained of and the
              injury suffered

       NWTS argues that Mr. Blair cannot satisfy the causation element of his CPA

claim. To satisfy the causation element, a "plaintiff must establish that, but for the

defendant's unfair or deceptive practice, the plaintiff would not have suffered an injury."

Indoor Billboard/Wash., Inc. v. lntegra Telecom of Wash., Inc., 162 Wn.2d 59, 84, 170

P.3d 10 (2007). This requires "a causal link between the misrepresentation and the

plaintiffs injury." Id. at 83. The existence of a causal link is usually a factual question.

Id.

       Although causation generally is a question of fact, one must nevertheless aver facts

that support a causal link. In one declaration, Mr. Blair states that he incurred attorney

fees and costs investigating the improper designation of BoA as beneficiary and BoA's

resulting improper appointment ofNWTS as successor trustee. We have held that BoA

was the beneficiary and, as the beneficiary, its appointment ofNWTS as successor trustee

was not improper. Mr. Blair does not aver that NWTS's violation ofRCW

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No. 32816-3-111
Blair v. Nw. Trustee Servs.


61.24.030(7)(a) caused him any injury. We are unable to locate any facts in the record

that support a causal link between NWTS's violation ofRCW 61.24.030(7)(a) and Mr.

Blair's injury.

       Moreover, NWTS's wrongful act was its violation ofRCW 61.24.030(7)(a)'s

requirement that it investigate BoA' s status prior to recording, transmitting, or serving the

notice of trustee's sale. Had NWTS complied with RCW 61.24.030(7)(a), it would have

learned that BoA was the holder of the note indorsed in blank, and that institution of the

nonjudicial foreclosure proceeding was arguably proper. 1 Consequently, NWTS's

violation ofRCW 61.24.030(7)(a) did not cause a wrongful initiation of foreclosure.

Because the initiation of foreclosure was not wrongful, Mr. Blair has failed to establish a

causal link between NWTS's wrongful act and his injury. We conclude that Mr. Blair has

failed, as a matter of law, to establish the causal link element of his CPA claim against

NWTS.

       4.     Actual prejudice


       1
         "[A ]cts or practices performed in good faith under an arguable interpretation of
existing law do not constitute unfair conduct violative of the consumer protection law."
Perry v. Island Sav. & Loan Ass 'n, 101 Wn.2d 795, 810, 684 P.2d 1281 (1984); accord
Leingang v. Pierce Co. Med. Bureau, Inc., 131 Wn.2d 133, 155, 930 P.2d 288 (1997);
Courchaine v. Commonwealth Land Title Ins. Co., 174 Wn. App. 27, 49, 296 P.3d 913
(2012); RCW 19.86.920 ("It is, however, the intent of the legislature that this act shall not
be construed to prohibit acts or practices which are reasonable in relation to the

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No. 32816-3-III
Blair v. Nw. Trustee Servs.


       NWTS asks that we require borrowers who bring a CPA claim premised on the

wrongful nonjudicial foreclosures to establish that the DTA violation actually prejudiced

them. NWTS cites a number of unpublished cases from Washington federal courts to

support its request. We see no need to adopt the requested rule. See Halvorson v. Dahl,

89 Wn.2d 673, 676, 574 P.2d 1190 (1978). We prefer to base our decision on the prima

facie framework of a CPA claim. We note that the failure to establish a causal link

between a wrongful act and a borrower's injury would have led to similar results in the

federal cases.

D.     Intentional/negligent misrepresentation liability

       Although Mr. Blair's opening brief refers to his claim as "Intentional and/or

Negligent Misrepresentation," he only provides argument relating to negligent

misrepresentation. Appellant's Br. at 27. We therefore restrict our analysis to the issue

briefed. Holland v. City of Tacoma, 90 Wn. App. 533, 538, 954 P.2d 290 (1998).

       "Washington has adopted the RESTATEMENT (SECOND) OF TORTS with respect to

the elements of negligent misrepresentation." ESCA Corp. v. KPMG Peat Marwick, 135

Wn.2d 820, 826, 959 P .2d 651 ( 1998). Each element must be proved by clear, cogent,




development and preservation of business .... ").

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No. 32816-3-111
Blair v. Nw. Trustee Servs.


and convincing evidence. Lawyers Title Ins. Corp. v. Baik, 147 Wn.2d 536, 545, 55 P.3d

619 (2002). The Restatement (Second) of Torts describes negligent misrepresentation as

       [o]ne who, in the course of his business, profession or employment, or in
       any other transaction in which he has a pecuniary interest, supplies false
       information for the guidance of others in their business transactions, is
       subject to liability for pecuniary loss caused to them by their justifiable
       reliance upon the information, if he fails to exercise reasonable care or
       competence in obtaining or communicating the information.

RESTATEMENT (SECOND) OF TORTS§ 552(1) (AM. LAW. INST. 1977), quoted in

Lawyers Title Ins. Corp., 14 7 Wn.2d at 545. In the context of alleged negligent

misrepresentation based on information provided in nonjudicial foreclosure forms,

the threshold concern is whether the forms contained false or misleading

information. Mann v. Household Fin. Corp. Ill, 109 Wn. App. 387, 391-92, 35

P.3d 1186 (2001).

      Here, Mr. Blair argues that "Defendant/Appellees supplied false information to

Mr. Blair and the public at large when they indicated through publicly recorded

documents that [BoA], not Freddie Mac, was the beneficiary of Mr. Blair's deed of

trust/promissory note and had the authority to appoint NWTS as a foreclosure trustee."

Appellant's Br. at 28. We have held that BoA, because it is the holder of the note

indorsed in blank, is the DTA beneficiary. As the lawful beneficiary, it had the power to

appoint NWTS to serve as successor trustee. Because Mr. Blair has failed to establish

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No. 32816-3-111
Blair v. Nw. Trustee Servs.


that any entity supplied false information, his negligent misrepresentation claim was

properly dismissed on summary judgment.

      Affirmed.




                                                 Lawrence-Berrey, J.

WE CONCUR:




F~i,i




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