# Opperwall v. Bank of America CA1/4

> California Court of Appeal · July 30, 2024

URL: https://www.frixlaw.com/law-library/cases/10491276

## Case

- **Court:** California Court of Appeal
- **Decided:** July 30, 2024
- **Precedential status:** Unpublished
- **Opinion:** Opinion
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10491276

## Opinion text

Filed 7/30/24 Opperwall v. Bank of America CA1/4
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or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

FIRST APPELLATE DISTRICT

DIVISION FOUR

STEPHEN G. OPPERWALL,
Plaintiff and Appellant,
A168865
v.
BANK OF AMERICA, N.A. et al., (Alameda County
Super. Ct. No. 22CV010352)
Defendants and Respondents.

Stephen G. Opperwall brings this lawsuit for wrongful foreclosure and
related claims against the bank that foreclosed on his home, Bank of America
N.A. (the Bank), and Quality Loan Service Corporation (Quality), the trustee
that conducted the foreclosure sale under a deed of trust encumbering his
home. He appeals the judgment dismissing his action after the trial court
sustained without leave to amend defendants’ demurrer on the ground that
the action is barred by the doctrine of res judicata. Opperwall’s appellate
counsel acknowledges that the operative complaint, which Opperwall filed
while appearing in propria persona, was poorly drafted and is “replete with
extraneous matters,” including arguments that had been rejected in prior
litigation. Nevertheless, Opperwall contends that the complaint alleged
“ultimate facts” sufficient to state a cause of action for wrongful foreclosure
and that the “unnecessary allegations Opperwall included in the [complaint]
should be treated as surplusage.” Alternatively, he contends that even if the

1
claim for wrongful foreclosure was not well pled the proposed amended
complaint, which is attached as an exhibit to the opening brief, demonstrates
that Opperwall could plead a cause of action for wrongful foreclosure that is
not barred by res judicata, along with several other related causes of action.
We find no error in the court’s order sustaining the demurrer but
conclude that Opperwall should be granted leave to file an amended
complaint against the Bank. We agree with Quality, however, that its
recording of a notice of default and a notice of sale are privileged and that
Opperwall has not alleged and cannot allege that Quality acted with malice.
Accordingly, we affirm the judgment in favor of Quality but reverse the
judgment entered in favor of the Bank and remand with instructions to
permit the filing of an amended complaint.
BACKGROUND
In 2007, Opperwall obtained a $900,000 loan from the Bank to buy a
house in Pleasanton, CA. The loan was secured by a Deed of Trust (Deed).
In February 2012, Opperwall filed a Chapter 13 bankruptcy petition.
Opperwall’s bankruptcy schedules stated that he owed the Bank $958,437.45
on the loan, including approximately $50,000 in arrears, and that the
property was then worth $885,000. In April 2012, Opperwall submitted a
Chapter 13 plan (the plan), which proposed that Opperwall would pay the
arrearage on the loan through the trustee at a rate of $500 per month for
6 months, then $1,504.18 per month for 54 months. The plan further
proposed that Opperwall would pay the bank directly $2,724.66 a month for
the 60-month duration of the plan. Although the plan was premised on
Opperwall obtaining a loan modification prior to confirmation of the plan, no
loan modification was obtained and the plan was confirmed by the
bankruptcy court.

2
In August 2014, the Bank moved to dismiss the bankruptcy case,
alleging that no loan modification agreement had been made. The
bankruptcy court denied the motion, finding that Opperwall had not
breached the plan but that payments under the plan did not create a formal
loan modification.
In September 2014, Opperwall filed an action against the Bank in state
court, claiming that the Bank had agreed to a loan modification that it was
no longer honoring. The action was removed to the bankruptcy court and
later dismissed. In dismissing the claim, the bankruptcy court held that
Opperwall’s claim that he had entered into an agreement to modify the loan
with the Bank before filing his bankruptcy petition was barred by the claim-
preclusive effect of Opperwall’s Chapter 13 plan and the order confirming
that plan. The bankruptcy court also rejected Opperwall’s assertion that his
loan was modified by his Chapter 13 plan and the Bank’s failure to object to
the plan. The dismissal of that action was affirmed by both the federal
district court and the Ninth Circuit Court of Appeals. (Opperwall v. Bank of
America, N.A. (9th Cir. 2018) 727 Fed.Appx. 329.)
Opperwall completed the plan and the bankruptcy was discharged on
May 9, 2017.
In June 2018, Opperwall filed a second action in state court against the
Bank, repeating the allegations that the Bank had agreed to modify his loan
but was not honoring that agreement. Again the action was removed to the
bankruptcy court and dismissed. The bankruptcy court’s conclusion that
Opperwall’s second action was precluded by the dismissal of his first action
and the confirmation of his Chapter 13 plan was affirmed by both the federal
district court and the Ninth Circuit Court of Appeals. (Opperwall v. Bank of
America, N.A. (9th Cir. 2021) 847 Fed.Appx. 490.)

3
In June 2019, Quality recorded a Notice of Default (Default Notice)
stating that Opperwall had been in default on his loan since March 1, 2015,
that he owed “past due payments plus permitted costs and expenses” in the
amount of $346,899.91 as of the date of the notice, and that the amount due
would increase until the account becomes current. The notice further advised
that if he failed to bring his account in good standing, the property may be
sold without any court action.
In September 2019, Opperwall filed his third state court action against
the Bank. His complaint alleged that the Notice of Satisfaction of Claim filed
by the Bank in the bankruptcy proceeding eliminated Opperwall’s obligations
under the note and deed of trust that was secured by the property, and that
therefore, the property was not subject to the June 2019 Default Notice that
Quality had recorded. The trial court sustained a demurrer by the Bank and
Quality and dismissed the action. This Court affirmed, holding that “the
notice of satisfaction could not properly be interpreted to reflect satisfaction
of the entire mortgage debt.” (Opperwall v. Quality Loan Serv. Corp.
(Nov. 17, 2021, A159461) [nonpub. opn.] 2021 Cal.App.Unpub. Lexis 7204, at
p. *9.)
On April 7, 2022, Quality recorded a Notice of Trustee’s Sale advising
Opperwall that he was in default under the deed of trust and that, unless he
took action to protect his property, it may be sold at a public sale. The notice
set the sale for May 5, 2022, and indicated that the amount of the unpaid
balance on the loan and other charges was $1,394,797.19.
On April 25, 2022, Opperwall filed the present action against the Bank
and Quality.
On May 5, 2022, the property was sold at a public auction for
$1,400,449.61 and a Trustee’s Deed was recorded on May 19, 2022.

4
In February 2023, Opperwall filed a First Amended Complaint
(hereafter complaint) in the present proceeding. The complaint asserts
causes of action for wrongful foreclosure, quiet title, declaratory relief and
application of Civil Code section 3275 (relief from forfeiture) based on
allegations that (1) the amount owed listed in the Notice of Sale was
excessive and (2) the value of the Property vastly exceeded the sale price.
With respect to the first ground, the complaint alleges that the $1,394,797.19
reflected in the notice was excessive because the amount owed on the loan
was constrained by the bankruptcy court’s order approving and confirming
his Chapter 13 plan, which “provided that the loan documents between
Plaintiff and Bank of America would be modified by operation of bankruptcy
law to provide for a principal balance of $899,746.16, an interest rate of 2%
fixed, a monthly payment of $2,724.66, and a fully amortized amortization
period of 40 years.” The complaint alleges that because “Bank of America did
not object to the Plan and did not object to the Confirmation Order and did
not appeal the Confirmation Order . . ., based on completely controlling
bankruptcy statutory law and case law, the documents and terms between
Plaintiff and Bank of America became as stated in the Plan and Confirmation
Order.” Opperwall alleges that, when properly determined, the amount
owing “was no greater than $734,158.62.” With respect to the second ground,
the complaint alleges only that the winning bid “at the trustee’s sale was for
the incorrect amount claimed by Bank of America plus one penny. At that
time, the Real Property had an estimated value that vastly exceeded that
amount.”
The Bank demurred to the amended complaint, arguing, among other
things, that the claims were barred by the doctrine of res judicata. Quality
filed a joinder in the Bank’s demurrer and also argued that its acts, as

5
alleged in the complaint, were privileged under Civil Code section 2924. The
trial court sustained the demurrer over Opperwall’s opposition, finding that
the claims alleged were barred by the res judicata effect of the judgments
entered against Opperwall in his three prior suits as well as the order
confirming his Chapter 13 bankruptcy plan. The court rejected Opperwall’s
request for leave to amend to cure any “pleading insufficiency that is argued
in any demurrer.”
Opperwall timely appealed from the judgments dismissing his claims
against the Bank and Quality.
DISCUSSION
I. Standard of Review
“ ‘Because a demurrer both tests the legal sufficiency of the complaint
and involves the trial court’s discretion, an appellate court employs two
separate standards of review on appeal. [Citation.] . . . Appellate courts first
review the complaint de novo to determine whether or not the . . . complaint
alleges facts sufficient to state a cause of action under any legal theory,
[citation], or in other words, to determine whether or not the trial court
erroneously sustained the demurrer as a matter of law. [Citation.]’
[Citation.] ‘Second, if a trial court sustains a demurrer without leave to
amend, appellate courts determine whether or not the plaintiff could amend
the complaint to state a cause of action.’ ” (Boyd v. Freeman (2017)
18 Cal.App.5th 847, 853.)
“Under the first standard of review, ‘we examine the complaint’s
factual allegations to determine whether they state a cause of action on any
available legal theory. [Citation.] We treat the demurrer as admitting all
material facts which were properly pleaded. [Citation.] However, we will not
assume the truth of contentions, deductions, or conclusions of fact or law
[citation], and we may disregard any allegations that are contrary to the law
6
or to a fact of which judicial notice may be taken.’ ” (Boyd v. Freeman, supra,
18 Cal.App.5th at p. 853.) A demurrer will lie where the complaint “ ‘ “has
included allegations that clearly disclose some defense or bar to recovery.” ’ ”
(Holiday Matinee, Inc. v. Rambus, Inc. (2004) 118 Cal.App.4th 1413, 1421,
italics omitted.)
“Under the second standard of review, the burden falls upon the
plaintiff to show what facts he or she could plead to cure the existing defects
in the complaint. [Citation.] ‘To meet this burden, a plaintiff must submit a
proposed amended complaint or, on appeal, enumerate the facts and
demonstrate how those facts establish a cause of action.’ ” (Boyd v. Freeman,
supra, 18 Cal.App.5th at pp. 853–854.)
II. Wrongful Foreclosure
The trial court sustained respondents’ demurrers on the ground that
Opperwall’s complaint was barred by the doctrine of res judicata. The court
concluded that the allegations in the complaint “are identical to prior
allegations in cases that resulted in final judgments on the merits in favor of
the same defendants in this case, or parties in privity to the present
defendants.” In the trial court, Opperwall, representing himself, clearly
stated, “This case seeks an adjudication of how much Opperwall owed to
Bank of America as of 5/5/22. The request is that the amount that was owed
was far less than the amount in the Notice of Trustee Sale.” His argument
was premised entirely on the allegations that his loan was modified by the
bankruptcy plan. Had Opperwall repeated these arguments on appeal, we
would likely agree with the trial court that his claim was barred by res
judicata. (See Colebrook v. CIT Bank, N.A. (2021) 64 Cal.App.5th 259, 264
[claim for wrongful foreclosure barred by res judicata where validity of
lender’s deed was determined adversely to borrower in prior pre-foreclosure
litigation].) On appeal, however, Opperwall, now represented by counsel,
7
concedes that there was no enforceable loan modification but argues that the
operative complaint, when stripped of the surplus allegations regarding the
loan modification, states a cause of action for wrongful foreclosure that is not
barred by res judicata and that is legally sufficient.
To state a cause of action for wrongful foreclosure, Opperwall must
allege, among other elements, that “ ‘ “ ‘[t]he trustee or mortgagee caused an
illegal, fraudulent, or willfully oppressive sale of real property pursuant to a
power of sale in a mortgage or deed of trust.’ ” ’ ” (Turner v. Seterus, Inc.
(2018) 27 Cal.App.5th 516, 525).1 “A nonjudicial foreclosure sale is
accompanied by a common law presumption that it ‘was conducted regularly
and fairly.’ [Citations.] This presumption may only be rebutted by
substantial evidence of prejudicial procedural irregularity. [Citation.] . . . It
is the burden of the party challenging the trustee’s sale to prove such
irregularity and thereby overcome the presumption of the sale’s regularity.”
(Melendrez v. D & I Investment, Inc. (2005) 127 Cal.App.4th 1238, 1258.)
Opperwall asserts that the complaint “alleged in satisfaction of the first
element that: the amount owed listed in the Notice of Sale was grossly

1 A cause of action for wrongful foreclosure also requires proof that

“ ‘ “ ‘the party attacking the sale (usually but not always the trustor or
mortgagor) was prejudiced or harmed; and . . . in cases where the trustor or
mortgagor challenges the sale, the trustor or mortgagor tendered the amount
of the secured indebtedness or was excused from tendering.’ ” ’ ” (Turner v.
Seterus, Inc., supra, 27 Cal.App.5th at p. 525.) Although the parties dispute
whether a cause of action for wrongful foreclosure has a fourth element, we
need not resolve that dispute in this action. (See Majd v. Bank of America,
N.A. (2015) 243 Cal.App.4th 1293, 1307 [adding fourth element that “ ‘ “no
breach of condition or failure of performance existed on the mortgagor’s or
trustor’s part which would have authorized the foreclosure or exercise of the
power of sale” ’ ”].)

8
excessive . . . and the value of the Property vastly exceeded the sale price.”
These allegations, however, are conclusory and unaccompanied by any
factual allegations necessary to establish a claim for wrongful foreclosure.
(See Kalnoki v. First American Trustee Servicing Solutions, LLC (2017)
8 Cal.App.5th 23, 45 [conclusory allegation that Trustee’s Deed Upon Sale
falsely recites that the statutory requirements under Civil Code section 2924
have been met is insufficient to rebut the ordinary presumption that the sale
was conducted regularly]; Melendrez v. D & I Investment, Inc., supra,
127 Cal.App.4th at p. 1258 [“ ‘mere inadequacy of price, absent some
procedural irregularity that contributed to the inadequacy of price or
otherwise injured the trustor, is insufficient to set aside a nonjudicial
foreclosure sale’ ” ].) Opperwall’s suggestion that the complaint alleges at
least one fact in support of his claim—“Respondents’ improper acceleration of
the debt”—is not supported by the record. While he claims on appeal that the
Bank violated paragraph 22 of the deed of trust by accelerating the debt
without prior notice, the operative complaint includes no such allegations.
The complaint did not, as Opperwall suggests, allege “sufficient facts to place
Respondents on notice of the basis of his claim for wrongful foreclosure.” As
such, Opperwall’s complaint failed to allege a cause of action for wrongful
foreclosure.
Opperwall does not dispute that, absent a valid claim for wrongful
foreclosure, his remaining causes of action for declaratory relief and for relief
from forfeiture under Civil Code section 3275 also fail. Nor does Opperwall
contest respondents’ argument that the complaint fails to allege a cause of
action to quiet title.
III. Leave to Amend to State a Cause of Action Against the Bank
Under Code of Civil Procedure section 472c, “When any court makes an
order sustaining a demurrer without leave to amend the question as to
9
whether or not such court abused its discretion in making such an order is
open on appeal even though no request to amend such pleading was made.”
“Contrary to long-standing rules generally precluding a party from changing
the theory of the case on appeal [citations], a plaintiff may propose new facts
or theories to show the complaint can be amended to state a cause of action,
thereby showing the trial court ‘abused its discretion’ [citation] in not
granting leave to amend.” (Connerly v. State of California (2014)
229 Cal.App.4th 457, 460.) “The power to permit amendments is interpreted
very liberally as long as the plaintiff does not attempt ‘to state facts which
give rise to a wholly distinct and different legal obligation against the
defendant.’ [Citation.] ‘Great liberality is indulged in matters of amendment
to the end that lawsuits may be determined upon their merits.’ [Citation.] ‘A
change of theory as to the basis of recovery or as to the measure of damages
is not a change of cause of action or the substitution of a new and different
action for the original.’ ” (Herrera v. Superior Court (1984) 158 Cal.App.3d
255, 259 [permitting amendment of the complaint where “the causes of action
in the amended complaint were different legal theories arising from the same
basic facts”].)
Here, the proposed complaint alleges that under section 22 of the Deed,
the Bank was required to give Opperwall written notice prior to accelerating
the loan following his default and that Opperwall did not receive such notice.2

2 Section 22 of the Deed reads: “Lender shall give notice to Borrower
prior to acceleration following Borrower’s breach of any covenant or
agreement in this Security Instrument . . . . The notice shall specify: (a) the
default; (b) the action required to cure the default; (c) a date, not less than
30 days from the date the notice is given to Borrower, by which the default
must be cured; and (d) that failure to cure the default on or before the date
specified in the notice may result in acceleration of the sums secured by this

10
The proposed complaint also adds allegations that, despite the assertion in
the Default Notice that the borrower had been contacted to explore options to
avoid foreclosure, in accordance with Civil Code section 2923.55,
subdivision (b)(2), no such contact was made. The proposed complaint alleges
that respondents wrongfully foreclosed upon the property by “(1) failing to
comply with section 22 of the [Deed], which required [the Bank] to give
Plaintiff specific notice before acceleration; (2) stating in the Default Notice
that [the Bank] had declared all sums secured by the [Deed] immediately due
and payable, notwithstanding [the Bank’s] lack of compliance with section 22;
(3) failing to contact Plaintiff to assess his financial situation and to explore
options for Plaintiff to avoid foreclosure, as required by Civil Code
section 2923.55[, subdivision] (b)(2); and (4) stating in the Sale Notice that
the amount then due to [the Bank] was the ‘[a]mount of unpaid balance and
other charges’ totaling $1,394,797.19, notwithstanding [the Bank’s] failure to
provide advance notice to Plaintiff of potential acceleration in compliance
with section 22 of the [Deed].” The proposed complaint again alleges that
respondents “also wrongfully foreclosed upon the Property by selling it for
only $1,400,449.61 at a time when its fair market value greatly exceeded that
amount.” The proposed complaint also adds a cause of action for breach of
contract based on the alleged improper acceleration of the loan, breach of the
Homeowner Bill of Rights based on the alleged failure to comply with the
Civil Code section 2923.55, and a violation of Business and Professions Code
section 17200 based on both sets of allegations.

Security Instrument and sale of the Property. The notice shall further inform
Borrower of the right to reinstate after acceleration and the right to bring a
court action to assert the non-existence of a default or any other defense of
Borrower to acceleration and sale.”
11
The Bank contends that the proposed amendment is improper because
it is based on new and different facts which give rise to distinct legal claims.
Alternatively, the Bank contends that the new facts do not allege an
actionable wrong under any theory.
Initially, we reject the argument that the proposed amendment is
impermissible. The central claim in the operative complaint was that the
Bank wrongfully foreclosed on his property, causing Opperwall to lose his
interest in it. Opperwall timely requested leave to amend and has proposed
specific amendments that add additional facts and theories in support of this
claim.
Citing CAMSI IV v. Hunter Technology Corp. (1991) 230 Cal.App.3d
1525, 1542 (CAMSI IV), the Bank argues that the trial court did not abuse its
discretion in denying leave to amend because Opperwall’s proposed
amendments are not “apparent and consistent with the [complaint’s] theory
of the case.” We disagree that the proposed amendments are not consistent
with the claim asserted in the operative complaint and find CAMSI IV
distinguishable. In that case, the court held that the trial court properly
sustained without leave to amend defendant’s demurrer to plaintiff’s claim
for negligence on the ground that it was barred by the statute of limitations.
(Id. at p. 1541.) At oral argument, in response to a question by the court, the
plaintiff expressly indicated that it was not seeking leave to amend to add a
cause of action for nuisance, which the court noted “in appropriate
circumstances would be subject to more favorable limitations rules.” (Id. at
p. 1539.) In a petition for rehearing, plaintiff asserted that it should be
granted leave to amend to allege a cause of action for nuisance based on a
new appellate decision filed after oral argument. (Id. at p. 1541.) The court
denied the petition on the ground that a reviewing court need not consider

12
points raised for the first time on petition for rehearing. (Id. at p. 1542.) The
court added that, even if it were to consider the argument, it “would find no
abuse of discretion.” (Ibid.) The court explained, “Even where there is no
request for leave to amend (or where, as here, the only arguable request was
wholly insufficient to suggest whether or how the plaintiff could amend) ‘the
question as to whether or not [the trial] court abused its discretion’ in
denying leave to amend remains open on appeal. [Citation.] But it is the
trial court’s discretion that is at issue; the reviewing court may only
determine, as a matter of law, whether the trial court’s discretion was
abused. In our view an abuse of discretion could be found, absent an effective
request for leave to amend in specified ways, only if a potentially effective
amendment were both apparent and consistent with the plaintiff’s theory of
the case. . . . Absent any indication whatsoever that [plaintiff] might wish to
change theories, the trial court was by no means obliged to invite [plaintiff] to
do so. There is a rational basis for hypothesis that (until it received this
court’s ruling) [plaintiff] would have been disinclined to shift to nuisance and
trespass theories. . . . The trial court could rationally have regarded
[plaintiff’s] choice among theories as essentially tactical and not subject to
interference by the court.” (Id. at pp. 1542–1543, italics omitted; but see
Connerly v. State of California, supra, 229 Cal.App.4th at p. 464, [questioning
but not deciding whether CAMSI IV “was correct in suggesting that a party
could be barred from timely raising new theories on appeal merely because
the timing appeared tactical” italics omitted].) Unlike in CAMSI IV,
Opperwall’s proposed amendments are not inconsistent with the allegations
of the operative complaint and were timely asserted along with his opening
brief on appeal.

13
We also reject the Bank’s argument that the proposed amendments fail
to state an actionable wrong under any theory of liability. The Bank asserts
that a standard notice of default given under Civil Code sections 2924,
subdivision (a)(1) and 2924c, such as that given by Quality in this instance,
satisfies section 22 of the Deed and that no separate, prior, or additional
notice is required. The proposed amended complaint alleges, however, that
“[t]he Default Notice provided by Quality to Plaintiff did not comply with
section 22 of the [Deed], in that: (1) Quality, not [the Bank], sent the Default
Notice to Plaintiff; (2) the Default Notice did not inform Plaintiff of a deadline
to cure his default; (3) the Default Notice did not inform Plaintiff that failure
to cure his default could result in acceleration (indeed, the Default Notice
asserted that [the Bank] had already “declared and does hereby declare all
sums secured [by the Deed] immediately due and payable”); (4) the Default
Notice did not inform Plaintiff of his right to reinstate the terms of the [Deed]
after acceleration; and (5) the Default Notice did not inform Plaintiff of his
right to bring a court action to assert the non-existence of a default or any
other defense of Plaintiff to acceleration and sale.”
Whether the Default Notice provided by Quality complied with the
requirements of section 22 of the Deed cannot be resolved as a matter of law
in the present appeal. While the notice undoubtedly included some of the
information required by section 22 of the Deed, it says nothing about
Opperwall’s right to bring a court action to assert the non-existence of a
default or any other defense to acceleration and sale. In addition, as
Opperwall notes, the Default Notice states somewhat confusingly both that
“you may have the legal right to bring your account in good standing by
paying all of your past due payments plus permitted costs and expenses
within the time permitted by law for reinstatement of your account, which is

14
normally five business days prior to the date set for the sale of your
property,” and that the beneficiary “has declared and does hereby declare all
sums secured [by the Deed] immediately due and payable and has elected
and does hereby elect to cause the trust property to be sold to satisfy the
obligations secured thereby.” Finally, the proposed complaint alleges that
the Bank, not Quality, must give notice of acceleration to satisfy the
requirements of section 22, and the Bank has provided no facts or legal
argument disputing that allegation.
The Bank also argues that “Opperwall fails to allege any facts—as
opposed to conclusions—to show that he suffered any damage from any
respect in which the notice of default failed to satisfy the requirements of
section 22 of the deed of trust.” The Bank’s suggestion that Opperwall “did
not need a [Bank]-provided notice to know his reinstatement and redemption
rights” because he was a lawyer, and “if he did not already know them, he
could easily learn by performing basic legal research,” is not a proper
argument in support of a demurrer. The Bank’s argument that Opperwall
“does not and cannot allege that he would have reinstated his loan or
redeemed his property if only he had been given the promised notice of
acceleration” conflicts with the allegation in the proposed complaint that “[i]n
the absence of acceleration, as of May 1, 2022, Plaintiff could have paid the
delinquent amount then due under the [Deed].” This allegation is sufficient
to overcome a demurrer.
The Bank’s argument that Opperwall cannot allege a failure to comply
with Civil Code section 2923.55 fares no better. Section 2923.55 governs the
steps that mortgagees, trustees, beneficiaries, or authorized agents are
obligated to take prior to recording a notice of default. Among these is the
requirement that the servicer make contact with the buyer at least 30 days

15
prior to the entry of the notice of default “in order to assess the borrower’s
financial situation and explore options for the borrower to avoid foreclosure.”
(Civ. Code § 2923.55, subd. (b)(2).) The proposed complaint alleges that the
Bank was required, but failed, to contact him between the date of his default
as set forth in the notice (March 1, 2015) and the date of the Default Notice
(June 4, 2019). Citing Rossberg v. Bank of America, N.A. (2013)
219 Cal.App.4th 1481, 1494, for the proposition that the required contact may
occur well in advance of recording the notice of default, the Bank argues that
“Opperwall’s complaints in his first two suits alleged that he had been in
repeated contact with [the Bank] about modifying his loan—far more contact
than [Civil Code] section 2923.55 requires” and that “ [t]he sham pleading
doctrine bars Opperwall from contradicting those allegations or omitting
them from any amended complaint without explanation.” In support of its
argument, the Bank cites to communication that was alleged to have
occurred in 2012. Opperwall responds that any contact Opperwall had with
the Bank prior to the date of his default as set forth in the notice has no
bearing on his claim. He asserts, “It is axiomatic that if Opperwall’s default
occurred as of March 1, 2015 . . . , the required contact must be made
thereafter.”
We decline to hold as a matter of law that any contact occurring before
the date specified in the notice of default cannot satisfy the requirement of
Civil Code section 2923.55, but at the same time, the present record does not
allow us to conclude that the 2012 contact between Opperwall and the Bank
necessarily does. The Bank’s reliance on Rossberg v. Bank of America, N.A.,
supra, 219 Cal.App.4th at pages 1494–1495 is misplaced. In that case, the
court merely held that contact in July 2009 was sufficient to support
recording of a notice of default in September 2009 because it was more than

16
30 days before the recording of the notice. It does not address the question
here—whether contact made prior to the date of default identified in the
notice is sufficient. At least one case has addressed this issue and concluded
that communications occurring prior to the default are not sufficient. In
Bever v. Cal-W. Reconveyance Corp., (E.D. Cal. Oct. 30, 2014, No. 1:11-CV-
1584 AWI SKO) 2014 U.S. Dist. Lexis 154220, at pages *21–*22, the court
held that under Civil Code section 2932.5, the predecessor statute to
section 2932.55, contacts made regarding prior delinquencies are not
sufficient for later-occurring delinquencies. The court explained that the
statute was enacted in response to the foreclosure crisis and that the “contact
requirement was intended in part ‘to change the foreclosure process so that
avoidable foreclosures could be avoided successfully.’ [Citation.] An
additional call to address the then existing conditions surrounding a current
delinquency appears consistent with the language and purpose of [Civil Code]
§ 2923.5; a contact that is nearly 2-years old and in relation to a different
delinquency does not.” (Ibid.) Here, the contacts described in the prior
litigation occurred not just well before the date of default identified in the
notice, but also before confirmation of Opperwall’s bankruptcy plan. Nothing
in the record explains the basis of the March 1, 2015 date identified in the
notice. Thus, it is unclear whether that default should be considered based
on a different delinquency from that which prompted the
2012 communication by the Bank. Under these circumstances, we cannot
conclude that Opperwall should be denied the opportunity to attempt to state
a cause of action based on the violation of Civil Code section 2923.55.
IV. Leave to Amend to State a Cause of Action Against Quality
Civil Code section 2924, subdivision (b), provides in relevant part that,
“[i]n performing acts required by this article, the trustee shall incur no
liability for any good faith error resulting from reliance on information
17
provided in good faith by the beneficiary regarding the nature and the
amount of the default under the secured obligation, deed of trust, or
mortgage . . . .” Section 2924, subdivision (d), further shields a trustee from
tort liability by granting it a qualified privilege for mailing, publication, and
delivery of notices of default and trustee’s sale and performing its other
statutory duties in connection with foreclosure of a deed of trust. The parties
agree that these trustee privileges are “qualified privileges” subject to the
malice exception. (Schep v. Capital One, N.A. (2017) 12 Cal.App.5th 1331,
1337; Kachlon v. Markowitz (2008) 168 Cal.App.4th 316, 333–334, 343.) In
this context, “ ‘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 v. Capital One, N.A., supra,
12 Cal.App.5th at p. 1337.) In the context of the present demurrer, the
question is whether Opperwall’s proposed complaint contains adequate
affirmative allegations of malice to find the qualified privilege inapplicable.
(See Smith v. Hatch (1969) 271 Cal.App.2d 39, 47 [“Since the qualified
privilege creates a presumption that the communication is made innocently
and without malice [citations], the pleadings must contain affirmative
allegations of malice in fact, and malice must exist as a fact in order to
destroy the privilege”].)
Quality asserts that Opperwall neither does nor can allege that it acted
out of malice in recording and serving the Default Notice or Notice of Sale. In
this regard, the proposed complaint alleges that Quality’s “wrongful
foreclosure and sale of the Property evidenced a wanton disregard of the
consequences and of the rights and feelings of Plaintiff.” Opperwall argues
specifically that “[t]he quintupling of the amount owed in less than three

18
years due to Quality’s unilateral acceleration of the debt—without
compliance with the deed of trust’s terms—” was sufficient to allege malice.
Quality, however, is not alleged to have done anything other than record and
deliver the two notices based on information it received from the Bank. It
had no obligation to give notice of the acceleration of the loan, nor was it
required to communicate with Opperwall regarding alternatives to
foreclosure—the two allegedly wrongful acts on which the claims in the
proposed amended complaint are premised.
Finally, Opperwall’s argument that Quality must remain a party to the
litigation because it is “a necessary party to Appellant’s cause of action for
wrongful foreclosure” is meritless. Majd v. Bank of America, N.A., supra,
243 Cal.App.4th 1293, 1307, relied on by Opperwall, merely holds that where
the trustee who conducted the sale is not party to an action for wrongful
foreclosure against a lender, the complaint must include allegations that the
trustee was the bank’s agent or was otherwise acting on the bank’s
instructions. Opperwall cites no case holding that a party may be required to
defend an action against it for which there is no basis for liability.

19
DISPOSITION
The judgment entered in favor of Quality is affirmed. The judgment
entered in favor of the Bank is reversed and the matter remanded with
instructions to the trial court to permit Opperwall to file a second amended
complaint against the Bank. The parties shall bear their own costs on
appeal.

GOLDMAN, J.

WE CONCUR:

BROWN, P. J.
DOUGLAS, J. *

* Judge of the Superior Court of Contra Costa County, assigned by the Chief

Justice pursuant to article VI, section 6 of the California Constitution.
20

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10491276. Public record. Not legal advice.