Filed 10/26/26 Alvarez v. ServiceMac CA2/1
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION ONE
RODOLFO ALVAREZ, B335620
Cross-complainant and (Los Angeles County
Appellant, Super. Ct. No. 20VECV00374)
v.
SERVICEMAC, LLC et al.,
Cross-defendants and
Respondents.
APPEAL from an order of the Superior Court of Los
Angeles County, Valerie Salkin, Judge. Affirmed.
Rodolfo Alvarez, in pro. per., for Cross-complainant and
Appellant.
Wright, Finlay & Zak and Joan C. Spaeder-Younkin for
Cross-defendant and Respondent ServiceMac, LLC.
Fidelity National Law Group and Josette D. Johnson for
Cross-defendant and Respondent Homebridge Financial Services,
Inc.
Rodolfo Alvarez claims that during his marriage to Magda
Susana Alvarez Mariaca,1 Magda secretly borrowed $200,000
secured by the family home. According to Rodolfo, when Magda
was unable to repay the debt, Magda clandestinely sold the home
to the lender, a woman named Miriam Sempertegui. Magda later
sued Sempertegui seeking among other things to quiet title to the
property. Rodolfo separately sued over the sale, and when his
case was related to Magda’s, he filed a cross-complaint. That
cross-complaint named as two of the cross-defendants
Homebridge Financial Services, Inc. (Homebridge), who provided
financing to Sempertegui for her purchase, and ServiceMac, LLC
(ServiceMac), which serviced Homebridge’s loan.
Homebridge and ServiceMac demurred to the cross-
complaint, and the trial court sustained the demurrer without
leave to amend. Rodolfo now appeals. We affirm as Rodolfo has
not alleged, nor demonstrated that he can amend to allege, facts
to overcome Homebridge and ServiceMac’s status as bona fide
encumbrancers for value under Civil Code sections 1107 and
1214.
BACKGROUND
As the cross-complaint named numerous defendants who
are not parties to this appeal, we limit our factual and procedural
summary to what is relevant to this appeal.
1 As they share a surname, for ease of reference we refer to
Rodolfo and Magda by their first names. We intend no
disrespect.
2
A. Relevant Allegations in the Cross-complaint
Rodolfo’s cross-complaint, as well as documents from the
Los Angeles County Registrar-Recorder (Recorder) as to which we
have agreed to take judicial notice, indicate the following.
Rodolfo married Magda in March 1980. A property on
Zelzah Avenue in Encino (the property) “was acquired during the
marriage on October 28, 2014, [and] registered with the . . .
Recorder.” The grant deed states that Magda alone acquired title
as “an unmarried person” (capitalization omitted) and that the
transfer was tax exempt because it was a gift to her. After the
property was acquired, Rodolfo and Magda lived at the property
with their children.
Unbeknownst to Rodolfo, Magda became indebted to
Sempertegui for $200,000. On December 15, 2016, a deed of trust
was filed against the property securing that debt. Sempertegui’s
lien was junior to another unspecified lien on the property. Like
the October 28, 2014 grant deed, the deed of trust in
Sempertegui’s favor indicated the property belonged to Magda as
“an [u]nmarried [w]oman.”
Although both the October 2014 grant deed and the
December 2016 deed of trust state the property belonged to
Magda alone, Rodolfo alleges it was in fact community property.
Rodolfo’s cross-complaint asserts that on August 8, 2017, Magda
agreed to transmute that community property into Rodolfo’s
separate property. Rodolfo’s opening appellate brief says
something different, namely that in August 2017 the property’s
title was changed “from community property to joint tenancy.”
This purported transfer on August 8, 2017 was not recorded until
May 2023. The recorded grant deed states the property was
conveyed from Magda, “a married woman,” to Rodolfo and
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Magda, “[h]usband and [w]ife, as joint tenants.” Although it was
recorded in 2023, the notary stamp on the deed indicates Magda
(the sole signatory) signed the transfer on August 8, 2017.
Rodolfo alleges that, unbeknownst to him and without his
involvement or consent, Magda agreed to sell the property to
Sempertegui after Sempertegui pressured her for repayment. On
August 14, 2019, a grant deed was recorded showing a sale of the
property by Magda, “an [u]nmarried [p]erson,” to Sempertegui.
To finance the purchase, Sempertegui took out a $680,000 loan
from Homebridge. The loan was serviced by ServiceMac. In
connection with the sale, Sempertegui’s $200,000 secondary lien
was extinguished along with the primary lien on the property.
Magda filed for dissolution of marriage in April 2020. The
record does not disclose what, if any, property-related orders the
family court has made.2
As already noted, a deed was filed in May 2023
documenting the August 2017 change in ownership of the
property from Magda to Magda and Rodolfo.
B. Procedural History
On March 16, 2020, Magda filed a complaint against
Sempertegui. In May 2021, Sempertegui filed a cross-complaint
against Magda. Neither of these pleadings are in the record. In
January 2022, Rodolfo filed a separate lawsuit against Magda,
Sempertegui, and a trustee of Sempertegui’s trust, which the
court consolidated with Magda’s existing case.
2 Because we have no visibility into the family law case,
nothing in this opinion should be read as superseding any orders
in the family law case regarding the property or debts associated
with it.
4
In June 2023, Rodolfo filed a cross-complaint against
Magda, Sempertegui, Homebridge, ServiceMac, and others. As to
Homebridge and ServiceMac, the cross-complaint asserted causes
of action for quiet title, cancellation of instruments, “estoppel by
deed,” negligent misrepresentation, and “preliminary and
permanent injunction.”
On December 4, 2023, the trial court sustained a demurrer
by Homebridge and ServiceMac to Rodolfo’s cross-complaint
without leave to amend. The court found Rodolfo had not “set
forth facts showing any particularized representation by
ServiceMac and/or Home[b]ridge which was intentionally or
negligently false. Nor does [Rodolfo] plead facts showing that
either ServiceMac or Home[b]ridge is a party to the written
instrument which he is seeking to cancel.” The court noted
Rodolfo’s allegation “that he is the [p]roperty’s rightful owner
because [Magda] transferred the [p]roperty to him as his separate
property asset is completely undercut by facts apparent on the
face of the grant deed, recorded on May 30, 2023[,] attached to
[Rodolfo]’s cross-complaint,” namely that the title was to be held
as husband and wife/joint tenants. (Boldface and underscoring
omitted.) “The face of [Rodolfo]’s cross-complaint unambiguously
indicates that he had no recorded interest in the [p]roperty when
Sempertegui recorded her interest.” Thus, “Home[b]ridge was a
bona fide encumbrancer at the time of the transfer and recording
of Home[b]ridge’s deed of trust” with “a complete defense to
[Rodolfo’s] causes of action. ServiceMac, as merely the loan
servicer, has no title or beneficial interest in the subject property
whatsoever” such that Rodolfo “cannot maintain any title claims
against ServiceMac.” (Boldface, underscoring, and italics
omitted.)
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The court entered an order of dismissal as to Homebridge
and ServiceMac on January 3, 2024, and Rodolfo timely appealed.
DISCUSSION
A. Standard of Review
“We review de novo an order sustaining a demurrer.”
(Center for Environmental Health v. Perrigo Co. (2023) 89
Cal.App.5th 1, 16.) “In reviewing the sufficiency of a complaint
against a general demurrer, we are guided by long-settled rules.
‘We treat the demurrer as admitting all material facts properly
pleaded, but not contentions, deductions or conclusions of fact or
law. [Citation.] We also consider matters which may be
judicially noticed.’ ” (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)
We “may take judicial notice of something that cannot
reasonably be controverted, even if it negates an express
allegation of the pleading. [Citation.] This includes recorded
deeds. [Citation.] [¶] However, the fact a court may take
judicial notice of a recorded deed, or similar document, does not
mean it may take judicial notice of factual matters stated
therein.” (Poseidon Development, Inc. v. Woodland Lane Estates,
LLC (2007) 152 Cal.App.4th 1106, 1117.) “ ‘When judicial notice
is taken of a document, . . . the truthfulness and proper
interpretation of the document are disputable.’ ” (Herrera v.
Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366,
1375.)
“[W]e give the complaint a reasonable interpretation,
reading it as a whole and its parts in their context. [Citation.]
When a demurrer is sustained, we determine whether the
complaint states facts sufficient to constitute a cause of action.
[Citation.] And when it is sustained without leave to amend, we
decide whether there is a reasonable possibility that the defect
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can be cured by amendment: if it can be, the trial court has
abused its discretion and we reverse; if not, there has been no
abuse of discretion and we affirm. [Citations.] The burden of
proving such reasonable possibility is squarely on the plaintiff.”
(Blank v. Kirwan, supra, 39 Cal.3d at p. 318.)
“We are not bound by the trial court’s stated reasons, if
any, supporting its ruling; we review the ruling, not its
rationale.” (Mendoza v. Town of Ross (2005) 128 Cal.App.4th
625, 631.)
B. Applicable Law Regarding Transfers and
Encumbrances
1. Family Code
“Except as otherwise provided by statute, all property, real
or personal, wherever situated, acquired by a married person
during the marriage while domiciled in this state is community
property.” (Fam. Code, § 760.) But “[a]ll property acquired by [a]
person after marriage by gift” is that person’s separate property
and not community property. (Id., § 770, subd. (a)(2).) Between
them, married persons can transmute the character of their
property by agreement or transfer. (Id., § 850.) “A
transmutation of real . . . property is not valid unless made in
writing by an express declaration that is made, joined in,
consented to, or accepted by the spouse whose interest in the
property is adversely affected.” (Id., § 852, subd. (a).) “A
transmutation of real property is not effective as to third parties
without notice thereof unless recorded.” (Id., subd. (b).)
Under Family Code section 1102, subdivision (a), “both
spouses, either personally or by a duly authorized agent, are
required to join in executing an instrument by which . . .
community real property or an interest therein is leased for a
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longer period than one year, or is sold, conveyed, or encumbered.”
There is an exception to this rule when only one spouse is on title
to community property and “a lessee, purchaser, or
encumbrancer” acts in good faith without knowledge of the
marriage relation; in that case, the transaction is presumed valid.
(Id., subd. (c)(2).)
2. Civil Code
Civil Code section 1107 states, “Every grant of an estate in
real property is conclusive against the grantor, also against every
one subsequently claiming under him, except a purchaser or
incumbrancer who in good faith and for a valuable consideration
acquires a title or lien by an instrument that is first duly
recorded.” Civil Code section 1214 similarly states in pertinent
part, “Every conveyance of real property . . . is void as against
any subsequent purchaser or mortgagee of the same property, or
any part thereof, in good faith and for a valuable consideration,
whose conveyance is first duly recorded . . . .” “A good faith
encumbrancer for value who first records takes its interest in the
real property free and clear of unrecorded interests. (Civ. Code,
§§ 1107, 1214; 3 Miller & Starr, Cal. Real Estate (2d ed. 1989)
Recording and Priorities, §§ 8:2, 8:3, pp. 270, 273 [unrecorded
instrument not enforceable against subsequent bona fide
purchaser who first records].)” (First Fidelity Thrift & Loan
Assn. v. Alliance Bank (1998) 60 Cal.App.4th 1433, 1440-1441.)
To be a good faith encumbrancer for value, Homebridge and
ServiceMac had to provide valuable consideration for the
property interest they received, and have had no knowledge or
notice of the asserted rights of another to the property.
(Melendrez v. D & I Investment, Inc. (2005) 127 Cal.App.4th 1238,
1251.)
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C. Rodolfo Cannot State a Claim for Quiet Title or
Cancellation of Instruments Against Homebridge or
ServiceMac
Rodolfo claims that his cross-complaint stated a cause of
action for quiet title and cancellation of instruments because the
transfer of the property to Sempertegui was “void ab initio.” We
disagree. Homebridge was a bona fide encumbrancer for value;
to the extent it had any interest in the property so was
ServiceMac as Homebridge’s servicer. There is no dispute
Homebridge lent significant sums in connection with the deed of
trust in its favor. When Homebridge had its deed of trust
recorded in 2019, the Recorder’s records showed that Magda
solely owned the property and was selling it to Sempertegui; the
2017 transfer on which Rodolfo relies was not recorded until
2023. Homebridge and its servicer ServiceMac thus could rely on
the then-existing property records absent knowledge or notice of
the asserted rights of another. (Civ. Code, §§ 1107, 1214;
Melendrez v. D & I Investment, Inc., supra, 127 Cal.App.4th at
p. 1251.) The cross-complaint fails to set forth any allegations
that Homebridge or ServiceMac had knowledge or notice of
Rodolfo’s asserted rights in 2019, and thus fails to state a claim
for quiet title or cancellation of instruments.
Rodolfo also claims that his allegation that Homebridge
and ServiceMac are not bona fide encumbrancers is sufficient in
and of itself to state a claim. It is not. “We do not accept as true
the pleader’s deductions, contentions, or conclusions of law” when
reviewing a demurrer ruling. (Doe 3, Family Services
Organization v. Superior Court (2025) 110 Cal.App.5th 571, 582.)
Rodolfo’s fallback argument is that the trial court
improperly denied him leave to amend because he can allege facts
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that Homebridge and ServiceMac were on inquiry notice
regarding his ownership interest. Accepting as true the proposed
new allegations he identifies, they do not suffice to overcome
Homebridge and ServiceMac’s bona fide encumbrancer defense.
Rodolfo first points out that “[o]pen and exclusive
possession of real property by one who is a stranger to record title
imposes on . . . [an] encumbrancer a duty [of] inquiry.” But he
ignores the exclusive qualifier of that test. Rodolfo does not
contend he alone possessed the marital home; he asserts that he
and Magda openly lived there together. “The possession required
to impart notice to a subsequent purchaser must be open,
notorious, exclusive and visible, and not consistent with the record
title.” (High Fidelity Enterprises, Inc. v. Hull (1962) 210
Cal.App.2d 279, 281, italics added.) Not only was Rodolfo not in
exclusive possession, there is nothing inconsistent between
Magda owning the house (either as an unmarried or married
woman) and Rodolfo living there alongside her. There is no duty
to investigate “when apparent possession is consistent with title
appearing of record.” (Caito v. United California Bank (1978) 20
Cal.3d 694, 702.)
Rodolfo also claims he can allege facts indicating that the
chain of title available to Homebridge at the time it made its loan
and recorded its deed of trust placed Homebridge and ServiceMac
on inquiry notice. In essence, he argues that information in that
chain of title and the escrow company’s records indicated the sale
to Sempertegui was not an arms-length transaction and included
suspect distribution of cash at closing to entities or individuals
(none of which were affiliated with Rodolfo). Accepting those
allegations as true, they would not place Homebridge or
ServiceMac on any inquiry notice that someone other than
10
Magda (namely, Rodolfo) had an interest in the property, which
is the relevant question.
The remainder of Rodolfo’s arguments address whether he
can state a claim against other defendants (such as Magda,
Sempertegui, or the escrow company) to recover his claimed
interest in the property. These claims include the requirement in
Family Code section 1102 for both spouses to consent to sales of
community property,3 and that recorded deeds are not conclusive
proof of the matters stated therein regarding who in fact owned
the property. Those assertions do not indicate, however, that
Rodolfo can demonstrate Homebridge and ServiceMac were not
bona fide encumbrancers protected by Civil Code sections 1107
and 1214. Homebridge and ServiceMac were legally entitled to
rely on the recorded chain of title absent notice it was incorrect,
and as already explained the additional facts Rodolfo states he
can allege are insufficient as a matter of law to show these
defendants had such notice.
D. Negligent Misrepresentation
The trial court did not err in sustaining the demurrer to the
negligent misrepresentation cause of action without leave to
amend.
“The elements of negligent misrepresentation are (1) the
defendant made a false representation as to a past or existing
material fact; (2) the defendant made the representation without
3 As previously noted, there is an exception to this rule for
good faith encumbrancers without knowledge of the marital
relationship. (Fam. Code, § 1102, subd. (c)(2).) Rodolfo identifies
no facts he can allege that Homebridge or ServiceMac in fact
knew of Magda and Rodolfo’s marriage at the time Homebridge
recorded its deed of trust.
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reasonable ground for believing it to be true; (3) in making the
representation, the defendant intended to deceive the plaintiff;
(4) the plaintiff justifiably relied on the representation; and
(5) the plaintiff suffered resulting damages.” (Majd v. Bank of
America, N.A. (2015) 243 Cal.App.4th 1293, 1307.) A cause of
action for negligent misrepresentation, like one for fraud, “must
be pleaded with particularity—that is, the pleading must set
forth how, when, where, to whom, and by what means the
representations were made.” (Foster v. Sexton (2021) 61
Cal.App.5th 998, 1028.)
Rodolfo’s cross-complaint fails to identify any particular
misrepresentation made by Homebridge or ServiceMac, much
less specifics about when and how it was made and Rodolfo’s
reliance upon it. Nor does Rodolfo identify any allegations he
could add to state a negligent misrepresentation claim against
either Homebridge or ServiceMac. He sets forth new facts he has
purportedly now learned from an escrow company’s records.
None of those additional facts involve a representation (much less
an alleged misrepresentation) by Homebridge or ServiceMac. We
also observe that Rodolfo’s factual allegations about what
happened are inconsistent with any alleged reliance on a
statement by Homebridge or ServiceMac. Rodolfo’s theory is that
the sale to Sempertegui (and Homebridge’s financing of it)
occurred without his knowledge, and we fail to see how he could
have received or relied on a misrepresentation by someone he did
not even know was involved with the property.
E. Remaining Claims
Rodolfo also sought to assert causes of action for “estoppel
by deed” and an injunction. The trial court properly sustained
the demurrer to these claims without leave to amend.
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Estoppel by deed is a common law doctrine that “precludes
a grantor of real property from asserting, as against the grantee,
any right or title in derogation of the deed.” (Schwenn v. Kaye
(1984) 155 Cal.App.3d 949, 951.) It is not a cause of action, and
Rodolfo makes no cogent argument that it is. Rodolfo argues only
that he could plead estoppel by deed as an element or theory
within another cause of action. But he has no such viable other
cause of action.
Rodolfo’s appellate briefing concedes that an injunction is a
remedy and not a standalone cause of action. (Ivanoff v. Bank of
America, N.A. (2017) 9 Cal.App.5th 719, 734 [collecting cases].)
That cause of action was therefore appropriately stricken at the
demurrer stage.
Rudolfo’s opening brief also sets forth allegations unrelated
to his claims against Homebridge and ServiceMac, such as claims
that Magda was subjected to elder abuse, that Homebridge was
the victim of bank fraud, and purported witness intimidation by
unidentified individuals. We see no relevance of these allegations
to the issues in this appeal, and Rodolfo does not claim they
provide a basis for any new claim by him against Homebridge or
ServiceMac.
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DISPOSITION
The dismissal order is affirmed. Respondents are awarded
their costs on appeal.
NOT TO BE PUBLISHED
WEINGART, J.
We concur:
ROTHSCHILD, P. J.
M. KIM, J.
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