Filed 11/5/18 Saber v. JPMorgan Chase Bank CA4/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

Appeal from a judgment of the Superior Court of Orange County, Linda S. Marks, Judge. Reversed.

The Tym Firm and Ronald D. Tym; Sam Saber, in pro. per., for Plaintiff and Appellant.

Bryan Cave, Glenn J. Plattner and Richard P. Steelman, Jr., for Defendant and Respondent.

* * *

Plaintiff Sam Saber appeals from a judgment of dismissal following the trial court’s order sustaining Defendant JPMorgan Chase Bank’s (Chase) demurrer to his First Amended Complaint (FAC). Saber contends the trial court erred in sustaining the demurrer, arguing that he stated causes of action for violation of Civil Code section 2923.7,[1] breach of the implied covenant of good faith and fair dealing, violation of the unfair competition law (UCL), and Business and Professions Code, sections 17200 et seq. For the reasons stated below, we conclude the trial court erred in sustaining the demurrer. Accordingly, we reverse the judgment.

I

FACTUAL BACKGROUND & PROCEDURAL HISTORY

Saber’s FAC

Saber filed his initial complaint against Chase on November 21, 2016. On March 13, 2017, Saber filed a FAC – the operative complaint – alleging claims for violation of section 2923.7 (second cause of action), breach of the implied covenant of good faith and fair dealing (third cause of action), and unfair business practices under the UCL (fourth cause of action). According to the FAC, in April 2005, Saber purchased a single family residence in Newport Beach. On October 12, 2007, he refinanced the home with a $2,693,500 loan from Washington Mutual (WaMu). As part of the refinance, he executed a note payable to WaMu (Note) and a deed of trust naming WaMu as a beneficiary (Deed of Trust). The FAC alleged that Saber currently occupies the residence and has done so since at least 2010. It further alleged that there are no other deeds of trust on the property senior to the Deed of Trust.

According to the FAC, in 2012, Chase – the purported successor beneficiary under the Deed of Trust – caused a Notice of Default to be executed and recorded on the subject property. In June 2016, Saber submitted an application to Chase for a loan modification. Chase subsequently demanded three additional documents to complete the loan modification application. The FAC alleged that Saber submitted the requested documents within the time demanded, and that representatives of Chase confirmed to Saber that his application was complete. However, on July 27, 2016, Chase caused the trustee under the Deed of Trust “to record and serve a Notice of Trustee’s Sale” (NOTS).

With respect to the second cause of action for violation of section 2923.7, the FAC alleged that Saber requested Chase provide the name and contact information of one person as a single point of contact (SPOC). However, Chase provided at least three persons, each located in a different state. These three persons denied that they are a “team of personnel” and insisted that he or she was the sole and proper point of contact. Their actions made it “utterly impossible” for Saber to know with whom he should be dealing with at Chase. The FAC sought injunctive relief prohibiting Chase from conducting a trustee’s sale of the subject property, attorney fees, and, “[i]n the event a trustee’s sale is conducted, treble actual damages or statutory damages . . . .” It also sought costs and any other relief the court finds just and equitable.

In the third cause of action for breach of the implied covenant, the FAC alleged that Note and Deed of Trust provided for a variable interest rate based on a fixed spread to an “Index,” published by the Federal Reserve Board, of the 12-month average annual yields on actively traded U.S. Treasury Securities. The FAC further alleged that Chase has admitted to conspiring with other banks to manipulate other indices resulting in artificially inflating the Index. It alleged that Saber substantially performed his obligations under the Note and the Deed of Trust by making timely payments on the loan until Chase began to artificially manipulate the Index and Saber was “damaged in that the aggregate interest Chase Bank has sought to charge under the Note and the Deed of Trust is hundreds of thousands of dollars more than if the Index had not been affected.” The FAC sought injunctive relief prohibiting a trustee’s sale until the interest charged is properly adjusted to remove the artificial inflation, damages in an amount to be proven at trial, costs and any other just and equitable relief.

As to the fourth cause of action for violation of the UCL, the FAC alleged that Chase engaged in an unlawful, fraudulent and unfair business practice when it manipulated the Index. It alleged that Saber was “harmed in that he has been charged artificially high interest rates and he risks the loss of his home because of this.” The FAC sought injunctive relief prohibiting a trustee’s sale until Chase reduces the amount it claims is due under the Note and Deed of Trust and records a new Notice of Default containing the accurate amount overdue, attorney fees and costs, and any other just and equitable relief.

Chase’s Demurrer to the FAC

On April 28, 2017, Chase demurred to the FAC. With respect to the second cause of action for violation of section 2923.7, Chase specially demurred on the grounds that the NOTS has been rescinded and that the property is not owner-occupied. Chase asserted that the July 27, 2016, NOTS was rescinded on April 11, 2017. It also noted that the Deed of Trust and the Declaration of Compliance attached to the second Notice of Default stated that the subject real property was not owner-occupied.[2] Chase also demurred on the ground that Saber was provided with an SPOC as required by section 2923.7. It noted that the FAC alleged Saber was provided with contact information for three persons, which Chase asserted complies with section 2923.7’s requirement to provide a team of personnel “knowledgeable about the borrower’s situation and current status in the alternatives to foreclosure process.” (§ 2923.7, subd. (e).) With respect to the third cause of action for breach of the implied covenant, Chase argued that the FAC failed to plead all of the necessary elements of the claim, including that Saber substantially complied with or was excused from his obligations under the contract. Chase further argued that because tort recovery for breach of the implied covenant is generally limited to those situations involving a special relationship between the parties and the FAC does not identify any such special relationship, the claim failed as a matter of law. With respect to the UCL claim in the fourth cause of action, Chase argued that Saber lacked standing to assert the claim because he could not show that he suffered any injury caused by Chase’s actions. In addition, as the UCL claim is based on Saber’s other claims, to the extent that he failed to state a viable claim for violation of section 2923.7 and for breach of the implied covenant, the derivative UCL claim also fails. Finally, Chase argued that leave to amend should not be granted because there was no reasonable possibility that another amendment to the FAC might cure the defects, noting that Saber previously had filed four other lawsuits alleging similar claims.[3]

Opposition to Demurrer

Saber opposed the demurrer. With respect to the second cause of action, he argued that Chase’s rescission of the NOTS did not cure its material violation of section 2923.7. Rather, the only cure is to provide an SPOC. He further argued that it was sufficient for the FAC to allege that the subject residence was owner-occupied. The contrary occupancy statement in the Deed of Trust, Saber asserted, cannot be considered under the doctrine of judicial notice, and is irrelevant, as there is no statutory requirement that section 2923.7 is limited to properties that are owner-occupied at the time the loan was made. As to the occupancy statement in the Declaration of Compliance attached to the Notice of Default, Saber argued that it was a self-serving statement made by Chase. Finally, Saber argued that providing contact information for three persons, who each claimed to be the SPOC to the exclusion of others, does not comply with section 2923.7.

With respect to the third cause of action, Saber argued that he adequately stated a claim for beach of the implied covenant. He contended that he was excused from further performance under the Note and Deed of Trust following Chase’s breach of its implied obligation to calculate the variable interest rate in good faith. Finally, he argued that he did identify a special relationship between the parties: as the party responsible for determining the variable interest rate, Chase had a fiduciary duty to calculate the rate accurately and without manipulation.

With respect to the UCL claim, Saber argued that he had standing because the FAC alleged that he lost hundreds of thousands of dollars through the overstatement of the interest rate and that he could lose his home due to the overstatement. Finally, Saber argued that were the trial court to sustain the demurrer in whole or in part, he should be granted leave to amend the FAC.

Reply in Support of Demurrer

In reply, Chase argued that Saber cannot state a claim for violation of section 2923.7 because in recent pleadings in another matter, he asserted that he resided at another address. Thus, Chase contended, Saber is judicially estopped from asserting in the instant litigation that the subject property is owner-occupied.[4] Chase further argued that because no trustee’s sale has occurred, the only remedy available for a violation of section 2923.7 is injunctive relief. However, Chase argued because the NOTS was rescinded, “there is no present controversy requiring the imposition of an injunction.” Finally, Chase argued there was no material violation of section 2923.7, as the FAC specifically pled that Saber’s loan modification application was completed.

Chase also argued that the allegations that it conspired with other banks to manipulate various other indexes were too vague and conclusory to state a claim for breach of the implied covenant. Chase further argued that the variable interest loan at issue is an ordinary commercial lending transaction. “As such, [Saber] is limited to traditional contract claims, and has no basis whatsoever for a tort claim based on the loan contract.”

Trial Court’s Ruling

On June 26, 2017, the trial court sustained Chase’s demurrer to the FAC without leave to amend. It ruled that as to the second cause of action for violation of section 2923.7, “this cause of action fails because [Chase] rescinded the Notice of Trustee[’s] Sale. . . . Here, because a trustee’s deed upon sale has not been recorded, [Saber] is only entitled to injunctive relief for a material violation of Civil Code section 2924.12. Because [Chase] rescinded the NOTS there is no controversy requiring the imposition of an injunction and sub[division] (c) states there shall be no liability for any violation that has been corrected prior to recording of a trustee’s deed upon sale.” As to the third cause of action for breach of the implied covenant of good faith and fair dealing, the court noted that “‘tort recovery for breach of the covenant is available only in limited circumstances, generally involving a special relationship between the contracting parties, such as the relationship between an insured and its insurer.’ (Bionghi v. Metro[politan] Water Dist. (1999) 70 Cal.App.4th 1358, 1370.)” The court ruled that “the FAC fails to allege and cannot allege a special relationship between [Saber] and [Chase] which would allow [Saber] recovery on a breach of implied covenant and fair dealing claim.” As to the fourth cause of action for violation of Business & Professions Code section 17200, the court concluded that Saber lacked standing to assert that claim “because he cannot show that he suffered economic injury caused by [Chase’s] alleged wrongful practice.” Although the trial court denied leave to amend, it did not provide any reasons.

After sustaining the demurrer, the court dismissed with prejudice the entire FAC. Saber timely appealed from the judgment of dismissal.

II

DISCUSSION

Saber contends the trial court erred in sustaining Chase’s demurrer to the FAC. We review a judgment of dismissal entered after an order sustaining a demurrer de novo. (Zelig v. County of Los Angeles (2002) 27 Cal.4th 1112, 1126.) “‘“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.” [Citation.] Further, we 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 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.’” (Ibid.)

A. Section 2923.7 Claim

In the second cause of action under the FAC, Saber alleged that he requested, but was not provided an SPOC. Section 2923.7, subdivision (a), provides that upon request from a borrower, “the mortgage servicer shall promptly establish a single point of contact and provide to the borrower one or more direct means of communication with the single point of contact.” The SPOC shall (1) communicate “the process by which a borrower may apply for an available foreclosure prevention alternative and the deadline for any required submissions to be considered for these options”; (2) coordinate receipt of all documents associated and notify the borrower of any missing documents; (3) have “access to current information and personnel sufficient to timely, accurately, and adequately inform the borrower of the current status of the foreclosure prevention alternative”; (4) ensure “that a borrower is considered for all foreclosure prevention alternatives offered by, or through, the mortgage servicer”; and (5) have “access to individuals with the ability and authority to stop foreclosure proceedings when necessary.” (§ 2923.7, subd. (b).)

The remedies for a material violation of section 2923.7 are set forth in section 2924.12. “If a trustee’s deed upon sale has not been recorded, a borrower may bring an action for injunctive relief to enjoin a material violation of Section . . . 2923.7 . . . .” (§ 2924.12, subd. (a)(1).) “Any injunction shall remain in place and any trustee’s sale shall be enjoined until the court determines that the mortgage servicer . . . has corrected and remedied the violation or violations giving rise to the action for injunctive relief. An enjoined entity may move to dissolve an injunction based on a showing that the material violation has been corrected and remedied.” (§ 2924.12, subd. (a)(2).) “After a trustee’s deed upon sale has been recorded, a mortgage servicer . . . shall be liable to a borrower for actual economic damages . . . resulting from a material violation of Section . . . 2923.7 . . . where the violation was not corrected and remedied prior to the recordation of the trustee’s deed upon sale.” (§ 2924.12, subd.(b).) “A mortgage servicer . . . shall not be liable for any violation that it has corrected and remedied prior to the recordation of the trustee’s deed upon sale, or that has been corrected and remedied by third parties working on its behalf prior to the recordation of the trustee’s deed upon sale.” (§ 2924.12, subd. (c).)

Here, the trial court sustained Chase’s demurrer to the section 2923.7 claim on the grounds that following Chase’s rescission of the NOTS, there was “no controversy requiring the imposition of an injunction” and that section 2924.12, subdivision (c), “states there shall be no liability for any violation that has been corrected prior to recording of a trustee’s deed upon sale.” However, Chase’s rescission of the NOTS does not excuse it from complying with section 2923.7. Under section 2924.12, subdivision (a), a borrower may bring an action to enjoin a material violation of section 2923.7. A borrower’s entitlement to injunctive relief to enjoin a material violation is distinct from the borrower’s entitlement to injunctive relief to enjoin a pending trustee’s sale. Section 2924.12, subdivision (a)(2), specifically provides that “[a]ny injunction shall remain in place and any trustee’s sale shall be enjoined” until the material violation is corrected and remedied. (Italics added.) Thus, whether a trustee’s sale is pending does not affect the borrower’s right to injunctive relief to enjoin a material violation of section 2923.7. Stated differently, the FAC placed into controversy whether Chase violated section 2923.7. Should a material violation be found, Saber would be entitled to injunctive relief to enjoin such violation.

Additionally, section 2924.12, subdivision (c), does not excuse Chase’s failure to comply with section 2923.7. That subdivision provides that a mortgage servicer “shall not be liable for any violation that it has corrected and remedied prior to the recordation of the trustee’s deed upon sale.” (§ 2924.12, subd. (c).) However, the reference to liability must be interpreted in connection with the preceding subdivision, which provides that a mortgage servicer “shall be liable to a borrower for actual economic damages . . . where the violation was not corrected and remedied prior to the recordation of the trustee’s deed upon sale.” (§ 2924.12, subd. (b).) Thus, section 2924.12, subdivision (c), is limited only to liability for damages resulting from a material violation of section 2923.7; it does not exempt Chase from being subject to injunctive relief to enjoin such material violation. Our interpretation of section 2924.12, subdivision (c), is also consistent with section 2924.12, subdivision (a)(2). As noted above, that subdivision provides for two distinct forms of injunctive relief. It further provides that “[a]n enjoined entity may move to dissolve an injunction based on a showing that the material violation has been corrected and remedied.” (§ 2924.12, subd. (a)(2).) This provision would be superfluous if section 2924.12, subdivision (c), were interpreted to prohibit a borrower from bringing an action for injunctive relief in the absence of a NOTS. In sum, Saber’s section 2923.7 claim is not barred by section 2924.12, subdivision (c).

Chase contends that Saber is not entitled to the benefits of section 2923.7 because he does not occupy the subject residence. Only borrowers seeking foreclosure alternatives for mortgages or deeds of trust secured by owner-occupied homes are entitled to the benefits of section 2923.7. (See § 2923.7, subd. (f) [“This section shall apply only to mortgages or deeds of trust described in Section 2924.15”].) Former section 2924.15, added by Statutes 2012, chapter 87, section 19, effective January 1, 2013, at the time Saber filed his FAC, provided: “Unless otherwise provided, Section[] . . . 2923.7 . . . shall apply only to first lien mortgages or deeds of trust that are secured by owner-occupied residential real property containing no more than four dwelling units. For these purposes, ‘owner-occupied’ means that the property is the principal residence of the borrower and is security for a loan made for personal, family, or household purposes.”[5]

Although the FAC alleged that Saber “currently occupies, and since at least 2010 has occupied, the Home as his principal residence,” Chase contends Saber is judicially estopped from alleging that the subject residence is owner-occupied based on his statements in pleadings filed in another matter. (See, e.g., M. Perez Co., Inc. v. Base Camp Condominiums Assn. No. One (2003) 111 Cal.App.4th 456, 463 [judicial estoppel is an equitable doctrine that “prohibits a party from taking inconsistent positions in the same or different judicial proceedings”].)[6] In verified complaints in that matter, Saber refers to another property, located in Santa Monica, as his “home” where he “at all times . . . has resided and continues to reside within the County of Los Angeles, California.” The most recent verified complaint containing these allegations was filed May 31, 2016. We conclude that the residency allegations in those verified complaints are not fatally inconsistent with the occupancy allegations in the FAC.

First, Saber did not allege in the verified complaints that the Santa Monica property is his principal residency. Second, due to the different time periods involved, it is not implausible that the Newport Beach property – the subject property in the FAC – is Saber’s principal residence for the purposes of section 2923.7. The verified complaints in the other matter alleged that Saber sought loan modifications in early 2015, and that the Santa Monica property was scheduled for sale in June 2016. The FAC alleged that Saber sought a loan modification for the Newport Beach property in June 2016. Thus, even if the Santa Monica property was Saber’s principal residence in 2015, it is not implausible that the Newport Beach residence became his principal residence in June 2016. At this stage in the proceedings, it is not appropriate for this court to resolve factual inconsistencies about Saber’s residency. (See Ramsden v. Western Union (1977) 71 Cal.App.3d 873, 879 [“A demurrer is simply not the appropriate procedure for determining the truth of disputed facts”].) Accordingly, Chase’s demurrer cannot be sustained on the basis that the allegations in the FAC are fatally inconsistent with the allegations in the verified complaints. (See also Mulato v. Wells Fargo Bank, N.A. (N.D. Cal. 2014) 76 F.Supp.3d 929, 958 [on bank’s motion to dismiss section 2923.7 cause of action for failure to state a claim, it was inappropriate to resolve factual inconsistencies regarding whether subject property was owner-occupied where occupancy allegations in another complaint were not fatally inconsistent with allegations in instant complaint].)

Turning to Chase’s remaining arguments in support of the trial court’s order sustaining the demurrer to the second cause of action, we find them without merit. First, Chase contends section 2923.7 does not support Saber’s demand for one person to contact. It notes that under section 2923.7, subdivision (e), “‘single point of contact’ means an individual or team of personnel each of whom has the ability and authority to perform the responsibilities described in subdivisions (b) to (d), inclusive.” (Italics added.) However, the FAC specifically alleged that the three persons provided to Saber as purported SPOCs expressly denied being a “team of personnel” and each represented that he or she was the exclusive SPOC on the matter. Thus, the FAC did not allege – and cannot reasonably be interpreted to allege – that Saber was provided an SPOC within the meaning of section 2923.7, when he was provided with three persons to contact.

Second, Chase contends there was no material violation of section 2923.7 because the FAC alleged that Saber “complete[d]” a loan modification application. Chase notes that section 2923.7 is part of a statutory scheme to provide eligible borrowers with a meaningful opportunity to obtain a loan modification. (§ 2923.4, subd. (a).) Additionally, because the NOTS was rescinded and the home is not in foreclosure, Chase contends Saber suffered no harm from any failure on the part of Chase to provide an SPOC. We disagree with both contentions. Under section 2923.7, an eligible borrower is entitled to an SPOC to assist in the process of applying for a loan modification. The denial of an SPOC arguably would deprive the borrower of a meaningful opportunity to obtain the loan modification.

The fact that Saber completed a loan modification application despite being denied an SPOC and the fact that his home is not in foreclosure do not cure a material violation of section 2923.7. On this point, Berman v. HSBC Bank USA, N.A. (2017) 11 Cal.App.5th 465, is instructive. There, the plaintiff Berman sought injunctive relief against the defendant HSBC, alleging that HSBC violated former section 2923.6, as repealed by Statutes 2012, chapter 87, section 7, effective January 1, 2013, by giving him only 15 days to appeal the denial of a loan modification, when former section 2923.6, subdivision (d), provides for an appeal period of at least 30 days. (Berman, at p. 468.) After the trial court sustained HSBC’s demurrer with leave to amend, the appellate court reversed, concluding that Berman’s complaint pled a material violation of former section 2923.6, subdivision (d). (Berman, at pp. 469, 472.) It rejected HSBC’s argument that the demurrer could be sustained on the basis (1) that Berman did not allege that HSBC conducted a trustee’s sale within the 30-day appeal period provided by subdivision (d), and (2) that “Berman did not appeal within the 30-day statutory period in any event, or even in all of the time that has passed since the September 2014 denial letter (now more than two and one-half years), and thus ‘has not been prejudiced in any manner.’” (Id. at p. 473.) The appellate court held that the failure either to allege a pending trustee’s sale or to appeal was not relevant to whether a material violation of former section 2923.6, subdivision (d), had occurred. Rather, “[i]f Berman proves up the allegations in his second amended complaint, then the denial letter was a material violation of section 2923.6 . . . .” (Berman, at p. 473.) Similarly, if Saber proves up the allegations that he was provided with three persons who denied being part of a team of personnel for the purposes of section 2923.7, then he would be entitled to injunctive relief.

B. Breach of the Implied Covenant Claim

In the third cause of action in the FAC, Saber alleged that Chase breached the implied covenant of good faith and fair dealing when it unlawfully manipulated various indices resulting in higher mortgage payments based on the resulting artificially inflated interest rates. The trial court sustained Chase’s demurrer to this claim on the ground that “‘tort recovery for breach of the covenant is available only in limited circumstances, generally involving a special relationship between the contracting parties,’” and “the FAC fails to allege and cannot allege a special relationship between [Saber] and [Chase] which would allow [Saber] recovery on a breach of implied covenant and fair dealing claim.” We need not determine whether Saber is precluded from seeking tort damages on the claim for breach of the implied covenant because, for the first time on appeal, Saber contends he is seeking only contractual damages. (See Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1392 [plaintiff alleging cause of action for breach for the implied contract may seek either tort or ordinary contract damages, depending on the facts alleged].) Our review of the FAC confirms that the third cause of action as alleged is consistent with a claim seeking contractual damages. The related prayer for relief sought injunctive relief “prohibiting . . . Chase . . . from conducting a Trustee’s sale of the Home until the interest charged is properly adjusted to delete the artificial inflation caused by manipulation of the ‘Index’” and “[d]amages in an amount to be proven at trial.” The injunctive relief indirectly seeks specific performance of the contract, i.e., it seeks to compel Chase to charge the correct and fair-market interest rates. The prayer for damages does not identify the type of damages, so ordinary contractual damages are within its scope. Moreover, we note that punitive damages were not sought, which is consistent with a contract-based claim for breach of the implied covenant. Finally, the FAC did not state a separate cause of action for breach of contract. Thus, Saber is not precluded from seeking contractual damages on his claim for breach of the implied covenant.

Chase contends Saber failed to state a claim for breach of the implied covenant because (1) he failed to plead facts indicating that he substantially performed on the contract, and (2) he failed to plead that all conditions required for Chase’s performance had occurred. Specifically, Chase argues that Saber’s failure to tender payments precluded his claim for breach of the implied covenant. We disagree. The FAC alleged that Saber substantially performed under the contract by “initially [making] timely payments on the loan.” The FAC then alleged that “when the time came to calculate the new [variable] interest on the Note,” Chase conspired with other banks to manipulate the rate and then charged Saber with the “artificially inflat[ed]” interest rates. These allegations are sufficient to state a claim for breach of the implied covenant. The FAC pled that Chase’s obligation to properly calculate the variable interest rate triggered “when the time came to calculate the new interest rate.” As to Saber’s performance, it pled that he performed until Chase materially breached the loan contract by charging artificially inflated interest rates. (See De Burgh v. De Burgh (1952) 39 Cal.2d 858, 863 [“in contract law a material breach excuses further performance by [an] innocent party”].) In sum, we conclude the FAC stated a claim for breach of the implied covenant.

Finally, Chase contends the claim for breach of implied covenant is time-barred. Under Code of Civil Procedure section 337, an action on a contract has a four-year limitations period. (See Love v. Fire Ins. Exchange (1990) 221 Cal.App.3d 1136, 1144, fn. 4 [claim for breach of implied covenant sounding in contract is subject to four-year limitations period].) Chase argues that “Saber’s own allegations from his prior lawsuits on the same Loan and Property show that Saber had knowledge about and indeed had litigated purportedly inflated interest rates on the Loan as early as July 2010 – more than six years prior to Saber’s current underlying lawsuit filed on November 21, 2016 . . . .” We disagree. In the prior lawsuits, Saber alleged he was fraudulently induced to apply for the subject loan, which is “a more dangerous, inappropriate, and unreasonably complex adjustable rate loan” than a fixed rate loan and that he was misinformed about the interest rates that would be charged. There was no allegation that the interest rates charged were artificially inflated by Chase’s manipulation of various indices. Thus, the allegations in the prior lawsuits do not show Saber had actual or constructive knowledge of Chase’s alleged misconduct as early as July 2010.[7] Moreover, as the cause of action in the FAC is not time-barred on its face, we conclude the demurrer cannot be sustained on statute of limitations ground. (See Lee v. Hanley (2015) 61 Cal.4th 1225, 1232 [demurrer based on a statute of limitations will bar action only where “‘“‘defect must clearly and affirmatively appear on the face of the complaint; it is not enough that the complaint shows that the action may be barred’”’”].)

C. UCL Claim

In the fourth cause of action, the FAC alleged a UCL claim based on Chase’s purported unlawful manipulation of the interest rates charged. The trial court sustained Chase’s demurrer to the UCL claim on the ground that Saber lacked “standing because he cannot show that he suffered economic injury caused by [Chase’s] alleged wrongful practice.” To establish standing under the UCL, a party must “(1) establish a loss or deprivation of money or property sufficient to qualify as injury in fact, i.e., economic injury, and (2) show that that economic injury was the result of, i.e., caused by, the unfair business practice.” (Kwikset Corp. v. Superior Court (2011) 51 Cal.4th 310, 322.) Here, the FAC alleged that Saber suffer an economic injury “in that he has been charged artificially inflated interest rates.” That allegation sufficiently established that Saber suffered economic injury – the additional payment amounts – caused by an unfair business practice – the artificial inflation of the interest rates via Chase’s manipulation of various indices. Thus, Saber has standing to bring the UCL claim.

Finally, Chase contends Saber is precluded from bringing the UCL claim, arguing that “Saber’s repeat Section 17200 claim [against Chase] . . . was dismissed with prejudice on summary judgment” in a prior lawsuit. We find no claim or issue preclusion. “California’s res judicata doctrine is based upon the primary right theory.” (Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 904.) “‘As far as its content is concerned, the primary right is simply the plaintiff’s right to be free from the particular injury suffered.’” (Ibid., quoting Crowley v. Katleman (1994) 8 Cal.4th 666, 681-682.) The UCL claim that was dismissed is legally distinct from the UCL claim here. In the prior lawsuit, the UCL claim was based on allegations that “Chase misrepresented its relationship with WaMu, failing to disclose that it had purchased only the right to collect on many residential loans, not the liability associated with the loans.” (See Saber v. JPMorgan Chase Bank, N.A. (C.D. Cal., May 22, 2014, No. SACV 13-00812 DOC) 2014 WL 2159395, p. *1.) Chase’s misrepresentations allegedly harmed Saber because he was “‘prevented from knowing who the true owner of the Note was and thus prevented from being able to communicate directly with the true owner of the Note on critical matters . . . , and this has caused [Saber] to be at increased risk of losing the Home to non judicial foreclosure.’” (Ibid.) In short, the prior UCL claim was based on alleged misrepresentation which resulted in potential foreclosure of the real property. In contrast, the current UCL claim is based on Chase’s allegedly admitted manipulation of interest rates which resulted in overcharges. As different injuries were alleged, the claims implicated different primary rights. Thus, the res judicata doctrine does not bar the instant UCL claim. Similarly, because the issue of Chase’s alleged manipulation of interest rates has not been previously litigated, collateral estoppel does not apply. (See City of Sacramento v. State of California (1990) 50 Cal.3d 51, 64 [“Generally, collateral estoppel bars the party to a prior action, or one in privity with him, from relitigating issues finally decided against him in the earlier action”].) In sum, the demurrer cannot be sustained on res judicata or collateral estoppel grounds.

III

DISPOSITION

The judgment of dismissal is reversed. Saber is entitled to his costs on appeal.

MOORE, J.

WE CONCUR:

O’LEARY, P. J.

FYBEL, J.