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       IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON

VALMARI RENATA,
                                                 No. 71402-3-1
                    Appellant,
                                                 DIVISION ONE
           v.



FLAGSTAR BANK, F.S.B., a federally
chartered savings bank; NORTHWEST
TRUSTEE SERVICES, INC., a
Washington corporation; MORTGAGE                 UNPUBLISHED OPINION
ELECTRONIC REGISTRATION
SYSTEMS, INC, a Delaware corpora                 FILED: July 27, 2015
tion and DOE DEFENDANTS 1-10,

                    Respondents.


       Becker, J. — The holder of a note is entitled to enforce it regardless of

whether the holder is also the owner. Because respondent Flagstar Bank was

the actual holder of the note given by the appellant, summary judgment was

appropriate. We affirm.

      On April 17, 2003, Capital Mortgage Corporation entered into a wholesale

lending broker agreement with Flagstar. Under the agreement, Flagstar agreed

to fund loans brought to it by Capital Mortgage so long as the loan

documentation met Flagstar's underwriting standards and Capital Mortgage

agreed to immediately indorse and deliver promissory notes to Flagstar.
No. 71402-3-1/2



       On August 4, 2006, Valmari Renata executed a note in favor of Capital

Mortgage in the amount of $200,800. The note bears an indorsement by

Christina Butler—Capital Mortgage's then-President—to Flagstar.

       On August 7, 2006, Renata executed a deed of trust, securing the note

against real property located in Everett, Washington. The deed listed Joan

Anderson of Flagstar as the trustee and the Mortgage Electronic Recording

System (commonly referred to as "MERS") as the beneficiary.

       On August 11, 2006, Flagstar received Renata's note. From this point on,

Flagstar was the holder of the note. Flagstar indorsed the note in blank.

       In December 2009, Renata fell into default on the loan.

       On July 23, 2010, Northwest Trustee Services Inc., acting as Flagstar's

agent, delivered a notice of default to Renata.

       On August 11, 2010, Flagstar appointed Northwest Trustee the successor

trustee.


       On August 16, 2010, MERS assigned its interest in the deed of trust to

Flagstar. MERS acted through its signing officer Sharon Morgan, who was also

a Flagstar officer.

       On September 7, 2010, Northwest Trustee recorded a notice of trustee's

sale, setting the sale for December 10, 2010.

       On December 9, 2010, Renata filed for bankruptcy. The scheduled sale

did not occur.

       On April 26, 2011, Renata's bankruptcy was dismissed.
No. 71402-3-1/3



       On May 3, 2011, Northwest Trustee recorded an amended notice of

trustee's sale, setting a new sale for June 10, 2011. The sale did not occur, and

the property has not been sold.

       On June 1, 2011, Renata filed a complaint against Flagstar, Northwest

Trustee, and MERS. In it, Renata alleged wrongful foreclosure and a violation of

the Consumer Protection Act, chapter 19.86 RCW. Renata also sought a

declaratory judgment that the deed of trust is "illegal" and to quiet title.

       On November 15, 2013, Flagstar and MERS filed a motion for summary

judgment. In their motion, Flagstar and MERS explained why each cause of

action should be dismissed.

              First, Plaintiff's wrongful foreclosure claim fails because the
       evidence shows that Flagstar may enforce the Note and Deed of
       Trust, [Northwest Trustee] is a valid Trustee authorized to carry out
       the foreclosure, and [Northwest Trustee] has complied with
       Washington's Deed of Trust Act.
               Second, Plaintiff is not entitled to declaratory judgment
       because Flagstar is a holder of the Note, and there is no basis for
       voiding the Deed of Trust simply because the Deed of Trust
       designated MERS as the beneficiary in an agency capacity for the
       Note holder.
              Third, Plaintiffs claim for violation of the Consumer
       Protection Act (CPA) fails because she cannot show an unfair or
       deceptive act, a public interest impact, injury, or causation.
              Fourth, Plaintiffs claim for quiet title fails because she has
       not paid off her loan, and Defendants are not claiming an
       ownership or possessory interest in Plaintiff's property.

Northwest Trustee joined this motion.

       On November 30, 2013, Renata filed a memorandum in opposition to

respondents' motion for summary judgment.

       On December 13, 2013, the trial court granted the motion for summary

judgment. Renata appeals.
No. 71402-3-1/4



                               STANDARD OF REVIEW

       We review an order granting summary judgment de novo, performing the

same inquiry as the trial court. Owen v. Burlington N. & Santa Fe R.R. Co.. 153

Wn.2d 780, 787, 108 P.3d 1220 (2005). A motion for summary judgment will be

granted where there is no genuine issue as to any material fact and the moving

party is entitled to judgment as a matter of law. CR 56(c). The nonmoving party

may not rely on speculation, argumentative assertions that unresolved factual

issues remain, or on having its affidavits considered at face value. Wash. Fed.

Sav. v. Klein. 177 Wn. App. 22, 311 P.3d 53 (2013). review denied. 179Wn.2d

1019(2014).

                                    ANALYSIS

Morgan declaration

       In the respondents' motion, they rely primarily on facts provided by the

declaration of Sharon Morgan, an employee of Flagstar. Renata asserts that the

trial court erred in admitting Morgan's declaration. Because the Morgan

declaration provides the facts relied on by the motion and the court, this

argument is addressed first.

       In her declaration, Morgan states, among other things, that Flagstar has

been in possession of the note since August 2006, Northwest Trustee acted as

Flagstar's agent in transmitting the notice of default in July 2010, and Flagstar

sent Northwest Trustee a beneficiary declaration, stating that Flagstar was the

actual holder of the note in August 2010.
No. 71402-3-1/5



       Normally, we review a trial court's decision to admit or exclude evidence

for an abuse of discretion. Discover Bank v. Bridges, 154 Wn. App. 722, 726,

226 P.3d 191 (2010). However, the de novo standard of review is used by an

appellate court when reviewing all trial court rulings made in conjunction with a

summary judgment ruling. Folsom v. Burger King, 135 Wn.2d 658, 663, 958

P.2d301 (1998).

      To be considered on summary judgment, a supporting declaration must be

made on personal knowledge and the facts set forth must be admissible in

evidence.

       Supporting and opposing affidavits shall be made on personal
       knowledge, shall set forth such facts as would be admissible in
       evidence, and shall show affirmatively that the affiant is competent
       to testify to the matters stated therein. Sworn or certified copies of
       all papers or parts thereof referred to in an affidavit shall be
       attached thereto or served therewith.

CR 56(e). Washington courts consider the requirement of personal knowledge to

be satisfied if the proponent of the evidence satisfies the business records

statute. See Discover Bank, 154 Wn. App. at 726. A business record is

admissible as competent evidence under certain, enumerated circumstances.

       A record of an act, condition or event, shall in so far as relevant, be
       competent evidence if the custodian or other qualified witness
       testifies to its identity and the mode of its preparation, and if it was
       made in the regular course of business, at or near the time of the
       act, condition or event, and if, in the opinion of the court, the
       sources of information, method and time of preparation were such
       as to justify its admission.

RCW 5.45.020.

       Morgan submitted two declarations in this case: the first on June 20, 2011,

and the second on October 15, 2013. In her first declaration, Morgan stated that
No. 71402-3-1/6



the information was compiled by employees of Flagstar. She did not state she

had personal knowledge of the information therein.

      The information set forth in this declaration was assembled by
      employees of Flagstar, with the assistance of counsel, based on a
      review of Flagstar's records and from personnel in the appropriate
      offices and departments of said entity. The matters stated herein
      are true and correct to the best of my knowledge and belief, based
      upon records and information kept in the normal course of business
      available at this time.

In her second declaration, Morgan did state that she had personal knowledge of

the information contained in her declaration.

      I have the personal knowledge required to execute this declaration,
      and can confirm the accuracy of the information set forth herein. If
      sworn as a witness, I could competently testify to the facts
       contained herein.
              3. In the regular and ordinary course of business, it is
       Flagstar's practice to make, collect, and maintain business records
       and documents related to any loan it originates, funds, purchases
       and/or services (collectively, "Business Records"). I have
       continuing access to the Business Records, and I am familiar with
       how each document attached to this declaration was retrieved and
       compiled. I have personally reviewed each document attached to
      this declaration.
              4. I am familiar with Flagstar's record-keeping practices for
       its physical receipt and possession of the original Note for the
       Subject Loan, which is tracked by the vault document management
       system.

       Renata asserts that Morgan's two declarations provide "contradictory

statements regarding her qualifications and the source of information she relies

upon." Renata is essentially arguing that because Morgan used different

language in each declaration, her statements were contradictory. That argument

fails. The fact that Morgan's second declaration does not use the same wording

as the first is not evidence that the statements are contradictory.
No. 71402-3-1/7



       Morgan demonstrated the requisite personal knowledge by stating that

she had personal knowledge of the way in which Flagstar's business records are

created and maintained and that she reviewed each of the records that provided

the information in her declaration. See Discover Bank v. Bridges, 154 Wn. App.

722, 226 P.3d 191 (2010).

       In Discover Bank, debtors appealed from a judgment requiring them to

pay their credit card debt. Relevant here is the debtors' argument that the trial

court erred in considering business records and affidavits from three employees

of a debt collection entity working on behalf of their creditor because "they do not

contain sworn testimony by competent fact witnesses." Discover Bank. 154 Wn.

App. at 726. This court rejected the debtors' argument.

               Here, [the declarants] collectively stated in their affidavits
       and declarations that (1) they worked for [the collections agency],
       (2) [two of the declarants] had access to the Bridgeses' account
       records in the course of their employment, (3) [the same two] made
       their statements based on personal knowledge and review of those
       records and under penalty of perjury, and (4) the attached account
       records were true and correct copies made in the ordinary course
       of business. The trial court properly considered the affidavits and
       declarations, and it did not abuse its discretion by considering the
       business records.

Discover Bank, 154 Wn. App. at 726 (footnote omitted).

       Like the declarants in Discover Bank, Morgan declared under penalty of

perjury that (1) she was an employee of Flagstar, (2) she had personal

knowledge of her company's practice of maintaining business records, (3) she

had personal knowledge from her own review of records related to Renata's note

and deed of trust, and (4) the records she attached were true and correct copies
No. 71402-3-1/8



of documents made in the ordinary course of business at or near the time of the

transaction.


       Renata does not identify any genuine issue of material fact as to Morgan's

qualifications, her statements, or the authenticity of the attached documents.

Renata asserts that Morgan presents information "this Court cannot reliably

verify." But she cites no authority, and we have found none, suggesting that a

declaration is inadmissible unless a court can independently verify the

information it contains.

       We conclude that the trial court did not err by considering the declaration

and attached business records.

Declaratory judgment

       Renata asserted a claim for declaratory judgment, asking the court to find

(1) that the subject deed of trust was void because it named MERS the

beneficiary, (2) MERS' assignment of its beneficial interest in the deed of trust

was void as a matter of law, and (3) Flagstar was not the holder or the owner of

the note. Renata asked that the nonjudicial foreclosure process be "declared

unlawful and permanently enjoined."

       In their motion for summary judgment, the respondents argued that the

trial court should dismiss Renata's claim for declaratory judgment because (1) no

court has declared a deed of trust "void" for naming MERS as a beneficiary, (2)

MERS had authority to assign its interest in the note to Flagstar, and (3) Flagstar

was a valid holder of the note.




                                         8
No. 71402-3-1/9



       Renata fails to cite any authority, and we have found none, to support an

argument that deeds of trust that name MERS as the beneficiary are void.

       Similarly, no authority supports Renata's assertion that an invalid

assignment from MERS supports a declaratory judgment and permanent

injunction prohibiting a trustee's sale.

       On appeal, Renata adds that the deed of trust is "deficient" because no

evidence in the record supports a finding that the original trustee named in the

deed—Joan Anderson of Flagstar—met the qualifications of RCW 61.24.010.

Renata appears to believe that this too renders the deed void. Renata cites no

authority, and we have found none, that supports a finding that an attempted

foreclosure is doomed by the designation of an unqualified original trustee in the

deed of trust. Also, to the extent Renata suggests that Joan Anderson was

unqualified because she was an employee of the beneficiary, that is no longer

the law. Cox v. Helenius, 103 Wn.2d 383, 390, 693 P.2d 683 (1985), citing Laws

of 1975, 1st Ex. Sess., ch. 129, §2 (amending the deed of trust act to allow an

employee agent or subsidiary of a beneficiary to serve as trustee).

       This court has persuasively and comprehensively rejected Renata's

argument that an entity must be both the note holder and the owner to enforce it.

In Truiillo, we held that "it is the status of holder of the note that entitles the entity

to enforce the obligation. Ownership of the note is not dispositive." Truiillo v.

Nw. Tr. Servs., Inc., 181 Wn. App. 484, 498, 326 P.3d 768 (2014), review

granted, 182 Wn.2d 1020 (2015). In a related argument that Flagstar did not

have "legal possession" of the note, Renata relies on article 9 of the Uniform
No. 71402-3-1/10



Commercial Code, which controls security interests in notes. As we also held in

Truiillo, nonjudicial foreclosure proceedings are not subject to article 9. Truiillo,

181 Wn. App. at 502-04; RCW 62A.9A-109(11); RCW 62A.9A-109, cmt. 7

(security interest in obligation secured by nonarticle 9 transaction). We adhere to

our opinion in Truiillo.

       Renata argues that Flagstar was not the holder of the note because

Capital Mortgage's indorsement to Flagstar was forged and therefore ineffective.

A declaration from the apparent indorser states that "the signature that appears

in the endorsement is not mine."


       This is not proof that the indorsement was ineffective. This is only

evidence that the signature was not that of the apparent indorser.

       Under the Uniform Commercial Code, unauthorized signatures are

ineffective unless ratified.

       Unless otherwise provided in this Article or Article 4, an
       unauthorized signature is ineffective except as the signature of the
       unauthorized signer in favor of a person who in good faith pays the
       instrument or takes it for value. An unauthorized signature may be
       ratified for all purposes of this Article.

RCW 62A.3-403(a). For a principal to be charged with the unauthorized act of its

agent by ratification, it must act with full knowledge of the facts or accept the

benefits of the act or intentionally assume the obligation imposed without inquiry.

Swiss Baco Skyline Logging, Inc. v. Haliewicz, 18 Wn. App. 21, 32, 567 P.2d

1141 (1977).

       Butler's declaration fails to create a genuine issue of material fact because

she does not state that she did not authorize another person to indorse the note


                                          10
No. 71402-3-1/11



on her behalf, a common practice. But even if she had stated she did not

authorize another person to indorse on her behalf, Capital Mortgage ratified the

indorsement when it complied with its contractual duty owed to Flagstar by

intentionally delivering the indorsed note to Flagstar and accepting payment.

       Renata asserts that a material issue of fact remains as to whether the

indorsement was forged. "Indeed, a trier of fact could reasonably conclude that

where the endorsement states that it is the signature of Ms. Butler, but she

refutes its authenticity, the signature is a forgery under RCW 62A.1-201(43)."

But if Capital Mortgage ratified the signature, the indorsement was effective even

if Butler's signature was forged. We conclude that the indorsement was ratified

by Capital Mortgage and Flagstar was the holder of the note. Under Truiillo,

Flagstar was entitled to enforce the note.

       The trial court properly dismissed Renata's claim for declaratory judgment.

Wrongful foreclosure

       The deed of trust act does not create an independent cause of action for

monetary damages based on alleged violations of its provisions where, as here,

no foreclosure sale has been completed. Frias v. Asset Foreclosure Servs., Inc.,

181 Wn.2d 412, 417, 334 P.3d 529 (2014). But, under appropriate factual

circumstances, violations of the deed of trust act may be actionable under the

Consumer Protection Act, even where no foreclosure sale has been completed.

Frias, 181 Wn.2d at 417. We consider the alleged violations in that context.




                                         11
No. 71402-3-1/12



Consumer Protection Act

       To prevail on an action for damages under the Consumer Protection Act,

the plaintiff must establish (1) unfair or deceptive act or practice; (2) occurring in

trade or commerce; (3) public interest impact; (4) injury to plaintiff in his or her

business or property; and (5) causation. Hangman Ridge Training Stables, Inc.

v. Safeco Title Ins. Co., 105 Wn.2d 778, 780, 719 P.2d 531 (1986). Whether a

particular action gives rise to a Consumer Protection Act violation is reviewable

as a question of law. Leingang v. Pierce County Med. Bureau, Inc.. 131 Wn.2d

133, 150, 930 P.2d 288 (1997).

MERS' involvement

       Renata asserts that an unfair or deceptive act or practice is presumed

where MERS is involved, citing Bain v. Metro. Mortg. Group. Inc.. 175 Wn.2d 83,

115-20, 285 P.3d 34(2012). That is not the law. In Bain, our Supreme Court

explicitly held that "the mere fact MERS is listed on the deed of trust as a

beneficiary is not itself an actionable injury." Bain. 175 Wn.2d at 120. Renata

points to the mere fact that MERS was listed as a beneficiary, which under Bain

is not enough.

Trustee's violation of its duty of good faith

       A trustee's violation of its duty of good faith may be actionable as a

violation of the Consumer Protection Act. See Frias, 181 Wn.2d at 417.

       While lenders, servicers, and their affiliates appoint trustees, a trustee is

not their agent. "The trustee or successor trustee has a duty of good faith to the

borrower, beneficiary, and grantor." RCW 61.24.010(4). In a judicial foreclosure


                                           12
No. 71402-3-1/13



action, an impartial judge of the superior court acts as the trustee and the debtor

has a one-year redemption period. RCW 61.12.040; RCW 4.12.010; RCW

6.23.020(1). In a nonjudicial foreclosure, by contrast, the trustee undertakes the

role of the judge as an impartial third party who owes a duty to both parties to

ensure that the rights of both the beneficiary and the debtor are protected. Cox,

103Wn.2dat389.

       First, Renata argues that Northwest Trustee breached the duty of good

faith by failing to investigate Sharon Morgan's "conflict of interest," allegedly

arising out of Morgan's assignment of MERS' interest in the deed to Flagstar

while acting as both a signing officer of MERS and an officer of Flagstar. MERS

has no employees and takes all action through its signing officers who are also

officers of its member entities. Bain, 175 Wn.2d 83. Renata cites no authority for

her assertion that Morgan had a conflict of interest. We reject Renata's

conclusory assertion that Northwest Trustee had a duty to investigate under

these circumstances.

       Second, Renata argues Northwest Trustee breached the duty of good

faith by relying on Flagstar's beneficiary declaration without investigating whether

Morgan truly had authority to execute the assignment on behalfof MERS. This

argument lacks merit and is unsupported by any relevant authority.
       Third, Renata asserts that Northwest Trustee violated the duty of good

faith by engaging in a "systematic disregard" of statutory notarization
requirements found in chapter42.44 RCW. She refers to the notice oftrustee's
sale, which has an effective date of April 29, 2011, but was not notarized until


                                          13
No. 71402-3-1/14



May 2, 2011. Renata argues that these facts give rise to a reasonable inference

that the document was not signed in the presence of the notary, in violation of

Washington law. In support of this assertion, Renata relies on Klem v.

Washington Mutual Bank, 176 Wn.2d 771, 295 P.3d 1179(2013).

       Klem does not support her assertion. In that case, Klem presented

evidence that the trustee falsely predated notarizations of trustee signatures on

notices of sale in order to expedite foreclosures unfairly. Klem, 176 Wn.2d at

777-78. Northwest Trustee persuasively explains that the effective date on a

notice of sale is not the same as the signing date. Rather, it refers to the

effective date of the amount due to reinstate, identified on that portion of the

notice totaling the monthly payments in arrears along with late charges and the

lender's and trustee's fees and costs. The effective date is unrelated to the date

of signature and notarization. The fact that the notice listed an effective date that

was earlier than the date of the notarization of the signature does not suggest

that Northwest Trustee disregarded statutory notarization requirements in this

case, let alone systematically as occurred in Klem.

       Fourth, Renata asserts Northwest Trustee violated the duty of good faith

by serving two notices of foreclosure that failed to identify the beneficiary of the

deed of trust and owner of the obligation. RCW 61.24.040(2) requires trustees to

send a notice of foreclosure with the notice of trustee's sale and includes a form.

The first paragraph of the form notice asks the trustee to list the name of the

beneficiary and owner of the obligation.




                                           14
No. 71402-3-1/15



       As we noted in Truiillo, RCW 61.24.040 directs only that a notice of

foreclosure must be in "substantially" the statutory form. RCW 61.24.040(1 )(f),

(2). Therefore, contrary to Renata's assertion, a trustee does not fail to strictly

comply with the terms of the act by not strictly following the statutory form

language in the notice of foreclosure. The accompanying notices of trustee's

sale informed Renata of the date of the sale, the title of the entity enforcing the

obligation, the amount needed to cure the default, the entity she should contact

to cure her default, and her right to contest default. The notices of trustee's sale

identified Flagstar as the beneficiary of the deed of trust. We conclude that taken

together, the notices substantially complied with the statutory form. And in any

event, Renata has not shown that she was harmed.

       Fifth, Renata argues that Northwest Trustee violated the duty of good faith

by misleadingly describing the original deed of trust. Trustees are statutorily

required to include a description of the original deed of trust in the notice of

trustee's sale. RCW 61.24.040(1 )(f). Northwest Trustee's description identified

MERS as the original beneficiary, succeeded by Flagstar. Renata claims that

this reference to MERS made it impossible for her to identify the true and lawful

holder of her loan. We disagree. The Notice of Trustee's Sale did not disguise

the fact clearly stated in the notice of default that Flagstar was the beneficiary.

       We conclude that Northwest Trustee did not violate its duty of good faith.

Because Renata has failed to establish an unfair or deceptive act or practice, we

need not consider whether she has established the remaining elements of a

Consumer Protection Act claim.



                                          15
No. 71402-3-1/16



         Renata's claim under the Consumer Protection Act was properly

dismissed.

Quiet title

         Through the same complaint, Renata seeks to quiet title in the property

subject to the deed of trust. "Plaintiffs ownership interest may be subject to

other liens, however for the reasons set forth above the subject deed of trust was

irreparably severed from any underlying obligation." As a result, Renata asserts

that "any security interest on the property arising from the deed of trust" is "null

and void."

         The respondents asserted no claim of ownership in Renata's property.

Since quiet title actions are designed to resolve competing claims of ownership

or the right to possess property, a quiet title action cannot survive where, as

here, there is no competing claim. Kobza v. Tripp, 105 Wn. App. 90, 95, 18 P.3d

621 (2001).

         We conclude the trial court properly dismissed Renata's action to quiet

title.


Additional discovery

         Renata claims that the trial court erred by denying her request to continue

discovery under CR 56(f).

         We review a trial court's denial of a CR 56(f) motion for abuse of

discretion. Qwest Corp. v. City of Bellevue, 161 Wn.2d 353, 369, 166 P.3d 667

(2007).




                                          16
No. 71402-3-1/17



       Where the party opposing summary judgment cannot, for reasons stated,

present essential facts to justify his or her opposition, courts may order a

continuance to permit additional discovery.

       Should it appear from the affidavits of a party opposing the motion
       [for summary judgment] that he cannot, for reasons stated, present
       by affidavit facts essential to justify his opposition, the court may
       refuse the application for judgment or may order a continuance to
       permit affidavits to be obtained or depositions to be taken or
       discovery to be had or may make such other order as is just.

CR 56(f). A party seeking such a continuance must provide an affidavit stating

what evidence it seeks and how this evidence will raise an issue of material fact

precluding summary judgment. Durand v. HIMC Corp., 151 Wn. App. 818, 214

P.3d 189(2009), review denied, 168Wn.2d 1020(2010). The trial court may

deny a motion for a continuance when (1) the requesting party does not have a

good reason for the delay in obtaining the evidence; (2) the requesting party

does not indicate what evidence would be established by further discovery; or (3)

the new evidence would not raise a genuine issue of fact. Qwest. 161 Wn.2d at

369, quoting Butler v. Joy. 116 Wn. App. 291, 299, 65 P.3d 671, review denied.

150Wn.2d 1017 (2003).

       Renata did not file an affidavit. She made her request for a continuance at

the end of her response to the respondents' motion for summary judgment.

There, she stated that she needed a continuance to conduct depositions under

CR 30(b)(6) to address "the issue of authorization" and "the issues surrounding

the forged endorsement." Renata does not specifically identify the evidence she

believes would be uncovered. And Renata does not provide a good reason for

her delay in obtaining this evidence.

                                         17
No. 71402-3-1/18



      Under these circumstances, we find that the trial court did not abuse its

discretion by denying Renata's request for a CR 56(f) continuance.

      Affirmed.




WE CONCUR:




                                       18
