# Tash v. Devoir Oblige Capital Group CA2/3

> California Court of Appeal · June 20, 2024

URL: https://www.frixlaw.com/law-library/cases/10074617

## Case

- **Court:** California Court of Appeal
- **Decided:** June 20, 2024
- **Precedential status:** Unpublished
- **Opinion:** Opinion
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

Filed 6/20/24 Tash v. Devoir Oblige Capital Group CA2/3
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions
not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion
has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION THREE

RAYMOND M. TASH et al., B327414

Plaintiffs and Appellants, Los Angeles County
Super. Ct. No.
v. 20STCV48390

DEVOIR OBLIGE CAPITAL
GROUP, LLC, et al.,

Defendants and Respondents.

APPEAL from a judgment of the Superior Court of
Los Angeles County, Robert B. Broadbelt, Judge. Affirmed.

Neufeld Marks and Paul S. Marks for Plaintiffs and
Appellants.

Wright, Finlay & Zak, Jonathan D. Fink and Cathy K.
Robinson for Defendants and Respondents.
_________________________
Plaintiffs Raymond and Katrin Tash appeal a judgment
of dismissal following an order sustaining the demurrer of
defendants Devoir Oblige Capital Group, LLC aka D.O. Capital
Group, LLC (Devoir Oblige); FCI Lender Services, Inc. (FCI);
SG Capital Partners, LLC (SG Capital); and Select Portfolio
Servicing, Inc. (SPS) (collectively, respondents). Respondents
became the successor mortgagees and loan servicers after
plaintiffs defaulted on their home mortgage. Although plaintiffs
admit executing and submitting a loan application that contained
false information, they allege a loan officer for their original
lender was responsible for including the falsehoods in the
application. Thus, plaintiffs contend respondents violated
the Rosenthal Fair Debt Collection Practices Act (the Rosenthal
Act or the Act, Civ. Code, § 1788 et seq.) by recording a notice
of default that stated plaintiffs’ loan application contained
materially false information.1 The trial court sustained
respondents’ demurrer, concluding respondents could not
be held liable for the loan officer’s alleged misconduct because
plaintiffs had specifically alleged the loan officer was an
employee of the original lender in his dealings with plaintiffs.
We affirm.
BACKGROUND
Consistent with the applicable standard of review, we draw
our statement of facts from the allegations of plaintiffs’ operative
second amended complaint and other matters properly subject
to judicial notice. (Stevenson v. Superior Court (1997) 16 Cal.4th
880, 885; Hanouchian v. Steele (2020) 51 Cal.App.5th 99, 103

1 Statutory references are to the Civil Code, unless otherwise
designated.

2
(Hanouchian).) “ ‘[W]e treat as true all material facts properly
pleaded, but not contentions, deductions or conclusions of fact
or law.’ ” (Hanouchian, at p. 103.)
Between late 2018 and early 2019, plaintiffs applied for
a loan from BM Real Estate Services, Inc. dba Priority Financial
Network (BM Real Estate) to purchase a home in Los Angeles.
They worked directly with a loan officer and employee of
BM Real Estate named Tzvi Ratner-Stauber.
Before preparing the loan documents, Ratner-Stauber met
with Raymond Tash to discuss plaintiffs’ application.2 During
the meeting, Tash disclosed that, in 2014, he lost a townhome
in Oregon to foreclosure and, two weeks later, he filed for
personal bankruptcy.
Sometime after the meeting, Ratner-Stauber presented
Tash with a partially filled out loan application that he asked
Tash to complete. Contrary to Tash’s disclosures, Ratner-
Stauber had prepared the application to state there had been
no bankruptcies or foreclosures within the past seven years.
The application also stated that no part of the down payment
was borrowed, even though Ratner-Stauber had himself
facilitated a separate loan to finance part of the down payment.
After receiving the application, Tash again discussed the
bankruptcy with Ratner-Stauber and supplied additional
information about the bankruptcy. Tash signed a later
version of the application that disclosed the bankruptcy, but
the application still falsely stated the down payment was

2 Because the relevant allegations concern only Raymond
Tash, we refer to him singly by his last name.

3
not financed and plaintiffs had not had a property foreclosed
upon within the past seven years.
BM Real Estate funded the loan sometime in 2019.
First American Title Insurance Company (First American Title)
was the trustee under the deed of trust.
In late 2019, plaintiffs missed a few mortgage payments.
The amount of the default exceeded $200,000. On two
unspecified dates, plaintiffs tendered funds to SPS, the then-
current loan servicer, to reinstate the loan. On both occasions,
SPS returned the funds and advised plaintiffs that the loan
had been accelerated due to a false statement in plaintiffs’
loan application. Thus, only a full repayment of the loan
(in excess of $2 million) would be accepted.3
In June 2020, SG Capital acquired the loan from
BM Real Estate. Sometime after that, Devoir Oblige acquired
the loan from SG Capital. FCI acted as loan servicer for
Devoir Oblige.
In August 2020, First American Title recorded a notice
of default and notice of sale on the property. Before the sale
could take place, Tash filed a petition for bankruptcy. In the
bankruptcy, he managed to obtain an alternative home loan

3 The deed of trust securing plaintiffs’ loan provides that
“Borrower shall be in default if, during the Loan Application
process, Borrower or any persons . . . with Borrower’s knowledge
or consent gave materially false, misleading, or inaccurate
information or statements to Lender (or failed to provide Lender
with material information) in connection with the Loan.” The
deed of trust authorizes the lender to accelerate the debt based
on “Borrower’s breach of any covenant or agreement in this
Security Instrument.”

4
(albeit at a significantly higher interest rate) and paid off the
original mortgage.
Plaintiffs sued respondents, as well as BM Real Estate,
Ratner-Stauber, and First American Title. As relevant to this
appeal, the operative second amended complaint asserts a cause
of action for violation of the Rosenthal Act against respondents
and the other defendants.4 In support of the claim, the complaint
alleges the defendants’ foreclosure notices “falsely stated that
there were material misrepresentations in [plaintiffs’] loan
application, and/or that any alleged incorrect statements were
materially false, and/or that the original lender reasonably
relied on any such statements in funding the mortgage loan.”
Respondents challenged the pleading by demurrer on
the ground that it failed to allege sufficient facts to state a claim
for violation of the Rosenthal Act. Among other things, they
argued the complaint admitted Tash executed and submitted
a loan application with several material misrepresentations;
none of respondents’ alleged conduct constituted a violation
of the Rosenthal Act; and, at most, Ratner-Stauber allegedly
engaged in inappropriate debt collection activity, but he was
not respondents’ agent.
The trial court sustained respondents’ demurrer without
leave to amend and entered a judgment of dismissal.5 Plaintiffs
filed a timely notice of appeal.

4 The operative pleading also asserted a cause of action for
declaratory relief against respondents and the other defendants.
Plaintiffs do not challenge the dismissal of this claim.
5 The trial court overruled in part a separate demurrer
filed by BM Real Estate and Ratner-Stauber, allowing plaintiffs’
Rosenthal Act claim to go forward against those defendants.

5
DISCUSSION
The Rosenthal Act aims “to prohibit debt collectors from
engaging in unfair or deceptive acts or practices in the collection
of consumer debts and to require debtors to act fairly in entering
into and honoring such debts.”6 (§ 1788.1, subd. (b).) Among
other things, the Act “generally requires ‘debt collector[s]
collecting or attempting to collect a consumer debt’ to comply
with the provisions of its federal counterpart, the Fair Debt
Collection Practices Act (FDCPA) (15 U.S.C. § 1692 et seq.).”
(Hagey v. Solar Service Experts, LLC (2023) 94 Cal.App.5th
1303, 1308, quoting § 1788.17; accord Best v. Ocwen Loan
Servicing, LLC (2021) 64 Cal.App.5th 568, 576 [the Act
“incorporates the FDCPA, so that a violation of the FDCPA
is per se a violation of the Rosenthal Act”].)7 Any debt collector
who violates the Act is liable for “any actual damages sustained
by the debtor as a result of the violation.” (§ 1788.30, subd. (a).)
Plaintiffs contend respondents’ alleged conduct violated
provisions of the FDCPA prohibiting a debt collector from using
“any false, deceptive, or misleading representation or means in

6 The Act defines “ ‘consumer debt’ ” as “money, property, or
their equivalent, due or owing or alleged to be due or owing from
a natural person by reason of a consumer credit transaction.”
(§ 1788.2, subd. (f).) The term “includes a mortgage debt.” (Ibid.)
7 Section 1788.17 provides: “Notwithstanding any other
provision of this title, every debt collector collecting or attempting
to collect a consumer debt shall comply with the provisions of
Sections 1692b to 1692j, inclusive, of, and shall be subject to the
remedies in Section 1692k of, Title 15 of the United States Code.”

6
connection with the collection of any debt.”8 (15 U.S.C. § 1692e;
see § 1788.17 [incorporating 15 U.S.C. § 1692e into Rosenthal
Act].) They point specifically to the allegation that the
notice of default “falsely stated that there were material
misrepresentations in [plaintiffs’] loan application, and/or that
any alleged incorrect statements were materially false, and/or
that the original lender reasonably relied on any such statements
in funding the mortgage loan.” Materiality, in plaintiffs’ telling,
is the crucial issue. They acknowledge the complaint admits
the loan application contained false information about a past
foreclosure and the use of borrowed funds to finance their
down payment. But plaintiffs argue these falsehoods could
not have been material to respondents because Tash disclosed
the true information to Ratner-Stauber, who, plaintiffs contend,
“was and is alleged to be an agent of defendants.”9

8 Respondents argue plaintiffs forfeited this issue by failing
to raise it below. The argument misunderstands the applicable
standard of review.
We apply the de novo standard of review to a judgment
of dismissal after an order sustaining a demurrer, exercising
our independent judgment about whether the complaint states
a cause of action as a matter of law. (Hanouchian, supra,
51 Cal.App.5th at p. 106.) When the trial court denies leave
to amend, we must also decide whether there is a reasonable
possibility that the defect can be cured by amendment. (Koszdin
v. State Comp. Ins. Fund (2010) 186 Cal.App.4th 480, 487.)
The plaintiff bears the burden of demonstrating a remedial
amendment is possible, and this “showing can be made for the
first time on appeal.” (Hanouchian, at p. 106, italics added, citing
City of Stockton v. Superior Court (2007) 42 Cal.4th 730, 746.)
9 Plaintiffs also appear to contend that respondent SPS
(the original loan servicer) improperly “overreached by refusing

7
The trial court rejected plaintiffs’ attempt to impute
Ratner-Stauber’s alleged knowledge and misconduct to
respondents, reasoning plaintiffs had “not sufficiently alleged
that he, as an employee or agent for defendant BM Real Estate
[citation], was acting on behalf of [respondents].” (Italics added.)
Plaintiffs contend the court erred. Because an agency allegation
is “ ‘a statement of ultimate fact,’ ” plaintiffs argue it was
sufficient to allege that “ ‘all defendants acted as agents of
every other defendant in the scope of said agency.’ ” (See Skopp
v. Weaver (1976) 16 Cal.3d 432, 439 (Skopp).) Had plaintiffs
alleged only this ultimate fact, we would be compelled to agree.
However, as the trial court recognized, the operative pleading
alleges specific facts that negate plaintiffs’ claim that Ratner-
Stauber was respondents’ agent.
“It is well established that in the context of a demurrer,
specific allegations control over more general ones.” (Chen v.
PayPal, Inc. (2021) 61 Cal.App.5th 559, 571, citing Medical
Marijuana, Inc. v. ProjectCBD.com (2016) 6 Cal.App.5th 602, 619
(ProjectCBD.com); Perez v. Golden Empire Transit Dist. (2012)
209 Cal.App.4th 1228, 1235–1236.) As the Perez court explained,
“[w]here a pleading includes a general allegation, such as an
allegation of an ultimate fact, as well as specific allegations
that add details or explanatory facts, it is possible that a conflict
or inconsistency will exist between the general allegation and

to accept” their loan reinstatement payments in lieu of
foreclosure. Plaintiffs do not develop the argument and make
no effort to explain how this conduct violated the Rosenthal Act.
“We are not required to examine undeveloped claims.” (Allen v.
City of Sacramento (2015) 234 Cal.App.4th 41, 52.) We deem
the contention forfeited. (Ibid.)

8
the specific allegations. To handle these contradictions,
California courts have adopted the principle that specific
allegations in a complaint control over an inconsistent general
allegation. [Citations.] Under this principle, it is possible that
specific allegations will render a complaint defective when the
general allegations, standing alone, might have been sufficient.”
(Perez, at pp. 1235–1236; see, e.g., Chen, at p. 572 [general
allegation that defendant acted in bad faith in placing holds
on plaintiffs’ accounts negated by specific allegation that
defendant placed holds due to decrease in plaintiffs’ “ ‘seller
rating[s]’ ” by third-party marketplace provider]; Willis v. Page
(1937) 19 Cal.App.2d 508, 512 [“The general allegation that
plaintiff had performed all of the conditions of the agreement
on his part, while specifically authorized by the code, is none
the less the statement of a conclusion and as such it is controlled
by the specific allegations which are in conflict therewith.”].)
Plaintiffs alleged that, “[a]t the time of the events at issue
here, Ratner-Stauber was an employee or loan officer (or other
agent), acting on behalf of the original lender, BM Real Estate,
in his dealings with Dr. Tash.” (Italics added.) This specific
factual allegation contradicts plaintiffs’ general averment that
“all defendants acted as agents of every other defendant in the
scope of said agency.” Plaintiffs do not (and presumably cannot)
offer any way to reconcile this critical inconsistency. The specific
allegation therefore controls and negates plaintiffs’ claim that
Ratner-Stauber acted as respondents’ (as opposed to the original
lender’s) agent when he dealt with Tash in preparing plaintiffs’
loan application. (See ProjectCBD.com, supra, 6 Cal.App.5th
at p. 619 [specific allegation that Project CBD defendants
published article on their own website and “other websites

9
(but not Facebook)” controlled over “the inconsistent, more
general allegation that all of the defendants published negative
statements on Facebook”]; cf. Skopp, supra, 16 Cal.3d at pp. 437–
438 [absence of specific allegation about formation of agency did
not negate general allegation that defendants acted “ ‘as agents
for the plaintiffs’ ”]; Blickman Turkus, LP v. MF Downtown
Sunnyvale, LLC (2008) 162 Cal.App.4th 858, 884–885 [argument
challenging “substantive soundness” of cross-claimant’s agency
theory did not negate general allegation that agency existed];
Garton v. Title Ins. & Trust Co. (1980) 106 Cal.App.3d 365, 376
[allegations “tend[ing] to show” individual was employed by
real estate brokerage did not preclude possibility that she
acted as agent for title company in relevant transaction].)
Because Ratner-Stauber’s alleged conduct cannot be
imputed to respondents, there is no reasonable possibility that
plaintiffs can state a claim for violation of the FDCPA or the
Rosenthal Act based on respondents’ role in directing the trustee
to record a notice of default on plaintiffs’ property. Although
plaintiffs urge us to focus on whether their admitted
misrepresentations were material, respondents correctly
assert the statutory privilege protecting parties engaged in
nonjudicial foreclosure proceedings is the dispositive issue.
Under section 2924, subdivision (d), a notice of default
or a notice of sale recorded as part of a nonjudicial foreclosure
proceeding constitutes a “ ‘privileged communication[ ] pursuant
to Section 47.’ ” (See Schep v. Capital One, N.A. (2017) 12
Cal.App.5th 1331, 1336 (Schep).)10 While reviewing courts

10 Our Legislature’s purpose in enacting section 2924 was
“ ‘to give trustees some measure of protection from tort liability
arising out of the performance of their statutory duties’ ” under

10
are divided over whether the absolute or qualified privilege
applies under the statute (see id. at p. 1337), the distinction
makes no difference in this case. Even under section 47’s
narrower qualified privilege, plaintiffs cannot state a claim
based on respondents’ alleged conduct. (See Schep, at p. 1337.)
The qualified privilege under section 47 applies
“ ‘to communications made without malice.’ ” (Schep, supra,
12 Cal.App.5th at p. 1337, citing § 47, subd. (c); Hagberg v.
California Federal Bank (2004) 32 Cal.4th 350, 360.) “ ‘[W]here
the complaint shows that the communication or publication
is one within the classes qualifiedly privileged, it is necessary
for the plaintiff to . . . plead and prove that the privilege is
not available as a defense in the particular case, e.g., because
of malice.’ ” (Smith v. Commonwealth Land Title Ins. Co. (1986)
177 Cal.App.3d 625, 630–631.) “For the purposes of section
47’s qualified privilege, ‘malice’ means that the defendant
(1) ‘ “was motivated by hatred or ill will towards the plaintiff,” ’
or (2) ‘ “lacked reasonable grounds for [its] belief in the truth
of the publication and therefore acted in reckless disregard of
the plaintiff’s rights.” ’ ” (Schep, at p. 1337, quoting Sanborn
v. Chronicle Pub. Co. (1976) 18 Cal.3d 406, 413; see § 48a,
subd. (d)(4) [defining “ ‘[a]ctual malice’ ” as “hatred or ill will
toward the plaintiff”].

the nonjudicial foreclosure statutes. (Schep, supra, 12
Cal.App.5th at p. 1336.) As the Schep court explained, this
purpose “is fulfilled only if all of the procedural steps attendant
to a nonjudicial foreclosure are privileged” and “only if the
privilege applies with equal force to both the trustee who actually
records the [notice of default] as well as the principal who directs
that recording.” (Id. at pp. 1336–1337.)

11
Although plaintiffs base their Rosenthal Act claim on
statements appearing in a notice of default and notice of sale,
they entirely ignore the privilege in their appellate briefing,
and they do not discuss how they could reasonably amend their
complaint to allege respondents acted with malice in directing
the trustee to record the notices. Nevertheless, based on what
plaintiffs have specifically alleged, we can conclusively say it
is not reasonably possible to amend the pleading to overcome
the privilege.
Plaintiffs’ operative complaint alleges Ratner-Stauber,
acting “on behalf of the original lender,” prepared a loan
application for plaintiffs with false information about a past
foreclosure and the use of borrowed funds to finance plaintiffs’
down payment. Notwithstanding Ratner-Stauber’s alleged
misconduct, the pleading also admits that plaintiffs executed
and submitted the loan application despite knowing it contained
these misrepresentations. Within a year of obtaining the loan,
plaintiffs defaulted on payments exceeding $200,000.
Respondents acquired the loan from the original lender after
plaintiffs’ default and, consistent with the terms of the mortgage,
accelerated the debt, and directed the trustee to record a notice
of default and notice of sale on the property. The notices
disclosed plaintiffs’ admitted misrepresentations. None of these
allegations could be reasonably amended to support a claim
that respondents made a false representation in the foreclosure
notices with hatred or ill will toward plaintiffs or a reckless
disregard for the truth. The trial court properly sustained
respondents’ demurrer to the Rosenthal Act claim without leave
to amend. (See Schep, supra, 12 Cal.App.5th at pp. 1337–1338
[demurrer properly sustained based on section 47 qualified

12
immunity where allegations suggested reasonable basis for
successor trustees’ belief in legitimacy of nonjudicial foreclosure
proceedings, notwithstanding recording of “wild deed” giving
trustees constructive notice of competing claim to title].)
DISPOSITION
The judgment is affirmed. Respondents Devoir Oblige
Capital Group, LLC aka D.O. Capital Group, LLC; FCI Lender
Services, Inc.; SG Capital Partners, LLC; and Select Portfolio
Servicing, Inc. are entitled to costs.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

EGERTON, J.

We concur:

LAVIN, Acting P. J.

ADAMS, J.

13

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10074617. Public record. Not legal advice.