target="H035400A_files/props0002.xml">
v. T.D. Service
Filed 7/10/13 Biancalana v. T.D. Service CA6
Opinion following transfer
from Supreme Court
NOT TO BE PUBLISHED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opinion has not been certified for publication or ordered published for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
SIXTH APPELLATE DISTRICT
DAVID
BIANCALANA,
Plaintiff and Appellant,
v.
T.D.
SERVICE COMPANY,
Defendant and Respondent.
H035400
(Santa Cruz County
Super. Ct. No. CV162804)
Having previously granted review,
the California Supreme Court filed its decision in this case on May 16,
2013. (Biancalana v. T.D. Service Co. (2013) 56 Cal.4th 807 (
previously rendered by this court and transferred the matter to us for further
proceedings consistent with the views expressed in its opinion.
and Procedural Background
A. Relevant trial court
proceedings
As explained in the Supreme Court’s
decision: “Plaintiff David Biancalana
filed an action to quiet title to a parcel of real property located at 434
Winchester Drive in Watsonville, California, alleging that he owned the
property because he was the highest bidder at a trustee’s sale that occurred on
September 10, 2008. According to
Biancalana’s complaint, EMC Mortgage Corporation (EMC) was the beneficiary of a
loan secured by a deed of trust on the property, and T.D. Service Company
(T.D.) was the trustee. After the loan
went into default, T.D. issued a notice of trustee’s sale. A copy of the notice of sale was attached to
the complaint. It stated that the
property would be sold at public auction to the highest bidder at the entrance
to the county offices in Santa Cruz at 10:00 a.m. on September 10, 2008. The notice said that ‘the total amount of the
unpaid balance of the obligation secured by the above described Deed of Trust
and estimated costs, expenses, and advances is $435,494.74,’ but added: ‘It is possible that at the time of sale the
opening bid may be less than the total indebtedness due.’ The notice included a telephone number that
could be called the day before the sale to learn ‘the expected opening bid,’ if
available.
“The complaint alleged that on the
day before the sale, Biancalana called the telephone number listed on the
notice of sale and learned that the opening bid on the property would be
$21,894.17. After researching the
property, Biancalana called the trustee again and confirmed the amount of the
opening bid. Biancalana then obtained a
cashier’s check for $22,000 and attended the auction the following day.
“On the morning of the sale, ‘the
auctioneer for the Defendant Trustee, made at least two calls to Defendant
Trustee and spoke with two different Trustee agents to verify the opening bid
of $21,894.17.’ When the auction began,
the auctioneer stated he had ‘been authorized to place an opening bid, on
behalf of the beneficiary, in the amount of $21,894.17.’ Biancalana then bid $21,896. There were no further bids, and the
auctioneer announced that ‘this property is sold to Mr. Biancalana for
$21,896.00.’ Biancalana gave the
auctioneer his cashier’s check for $22,000.
“Two days later, T.D. telephoned
Biancalana and said the sale was void because T.D. ‘did not offer the Property
for a high enough bid amount.’ T.D.
returned the cashier’s check, but Biancalana returned the cashier’s check to
T.D. and demanded the deed. After T.D.
refused, Biancalana filed the present action.
“T.D. filed an answer admitting that
Biancalana had given a cashier’s check for $22,000 to the auctioneer and that
T.D. had returned those funds and refused to issue a deed to the property, but
otherwise denying the allegations in the complaint. As an affirmative defense, T.D. alleged that
‘[p]rior to the auction attended by plaintiff, a proper and enforceable credit
bid was submitted by the foreclosing beneficiary in the sum of $219,105, and
accepted by Answering Defendant as trustee.
Accordingly, . . . that was a fully effective and completed bid which
was higher than the amount bid by plaintiff.
As such, the actual high bid at the sale was not plaintiff’s, but rather
was the foreclosing beneficiary’s completed and accepted credit bid.’
“T.D. moved for summary judgment on
the ground that it had properly set aside the foreclosure sale due to a
significant procedural irregularity in the statutory foreclosure process
coupled with an inadequate sales price.
T.D. asserted that prior to the sale ‘the beneficiary submitted for the
auction a credit bid in the amount of $219,105 which was accepted by T.D.
Service Company and was intended to be announced as the opening bid at the
sale.’ T.D. said it had mistakenly told
the auctioneer that the opening bid was ‘the delinquency amount (exclusive of
foreclosure costs) of $21,894.17 . . . rather than the actual credit bid submitted
by the foreclosing beneficiary. The
lesser figure was likewise mistakenly announced at the sale.’ In support, T.D. submitted the declaration of
its vice-president of operations, Patricia Randall, who declared that ‘the day
before the sale, the beneficiary submitted a specified credit bid in the sum of
$219,105.’ This credit bid was contained
within a document entitled in part ‘Bid Information.’ The document, a copy of which was attached to
Randall’s declaration, states: ‘EMC
Specified Bid: $219,105.00.’ The bid of $21,894.17 that T.D. conveyed to
the auctioneer does not appear on this document, but near the bottom of the
document appear amounts of $21,010.59 for interest, $14.09 for escrow advance,
$724.74 for late fees, and $144.75 for ‘recoverable balance.’ When added together, these amounts equal
$21,894.17.
“According to Randall, T.D. then
prepared a document entitled ‘Bid Amount Verification’ that mistakenly listed
the amount of the opening bid as $21,894.17.
This document, a copy of which was also attached to Randall’s
declaration, instructed the auctioneer to submit only the ‘specified bid’ of
$21,894.17 and not to make any further bids.
Based upon this document, the auctioneer announced an opening bid of
$21,894.17. T.D. discovered its error
later that day, after the sale had been completed but before it had issued a
deed.†(Biancalana, supra, 56
Cal.4th at pp. 811-812.)
The trial court granted T.D’s motion
for summary judgment on Biancalana’s complaint.
The court determined that T.D.’s error was a procedural irregularity
within the statutory foreclosure process and that T.D. was thus entitled to set
aside the foreclosure sale.
B. Our prior appellate
decision
Biancalana appealed the judgment to
this court. We “reversed, holding that
T.D.’s error was not a procedural irregularity in the statutory foreclosure
process and that T.D. therefore had no discretionary authority to void the
foreclosure sale.†(Biancalana, supra, 56
Cal.4th at p. 813.)
C. The Supreme Court’
On T.D.’s petition, the Supreme
Court granted review. (
The Supreme Court first reviewed the law governing nonjudicial
foreclosure sales. (Id. at pp. 813-814.) The
court noted that delivery of the trustee’s deed to a bona fide purchaser gives
rise to a conclusive presumption that the foreclosure sale has been conducted
regularly and properly, but where a defect in the procedure is discovered prior
to delivery of the deed, the trustee is empowered to void the sale, return the
purchase price to a bona fide purchaser and recommence the foreclosure
process. (Ibid.) Since T.D. discovered
the error in its bid before delivering the deed, the conclusive presumption did
not apply and T.D. was entitled to set aside the sale due to the gross
inadequacy of price conveyed by Biancalana.
The court also held that T.D.’s “transcription error†qualified as an
“irregularity occurring within the
statutory foreclosure sale process,†since it caused the auctioneer to announce
a mistaken opening bid from the beneficiary at the auction. (Id.
at p. 816.) Finally, the court explained
that T.D.’s error could not be imputed to the beneficiary since a “trustee
under a deed of trust is an agent of the beneficiary only in a limited sense.†(Id.
at p. 819.) Because T.D. “did not act
pursuant to the beneficiary’s instructions[,] . . . the error was [T.D.]’s
alone.†(Id. at p. 820.) Accordingly,
T.D. was entitled to entry of summary judgment in its favor.
II. Disposition
Consistent with the Supreme Court’s
directions, we affirm the judgment. The
parties shall bear their own costs on appeal.
Premo,
J.
WE CONCUR:
Rushing, P.J.
Elia, J.
