Opinion
66721-1-I
05-29-2012
JACK GRANT, Appellant, v. FIRST HORIZON HOME LOANS, a.k.a. First Horizon Corporation, d/b/a First Horizon Home Loans; QUALITY LOAN SERVICE CORPORATION OF WASHINGTON, a Washington corporation; STEWART TITLE, d/b/a Stewart Title of Bellingham; STEWART TITLE OF WESTERN WASHINGTON, INC., a Washington corporation, d/b/a Stewart Title of Bellingham; STEWART TITLE OF BELLINGHAM, INC., a Washington corporation, d/b/a Stewart Title of Bellingham, Respondents.
UNPUBLISHED OPINION
Ellington, J.
Jack Grant filed suit against his lender and others to enjoin foreclosure proceedings on his beachfront home in Whatcom County. In addition to an injunction, he sought damages for breach of contract, bad faith, intentional infliction of emotional distress, interference with contractual relations, negligence, and violation of statutory requirements. The court granted the defendants' CR 12(b)(6) and CR 12(c) motions to dismiss. With one exception, we affirm the trial court. Grant's complaint alleges facts sufficient to create a triable issue with respect to the defendants' right to foreclose. On that issue, we reverse and remand for further proceedings.
BACKGROUND
In December 2003, Grant obtained an $800,000 construction loan from Horizon Bank to make improvements to his beach cottage in Blaine, Washington. The following year, Grant submitted an application to First Horizon Home Loans for a new loan of $838,000 to refinance the construction loan. As a condition for the new loan, Stewart Title informed Grant that his wife must be added to the title and must sign the note. Additionally, the loan amount approved was only $800,000. Grant objected to the changes, but he ultimately executed a quitclaim deed adding his wife to the title. Grant and his wife then signed the note and executed a deed of trust. According to Grant, he received an oral commitment that the quitclaim deed would be held in a file and not recorded except in the event of default. In fact, the quitclaim deed was recorded immediately. Grant and his wife divorced in 2009. Grant was awarded the beach property as his separate property.
The loan documents are central to this dispute. The promissory note identifies the lender as "First Horizon Corporation d/b/a First Horizon Home Loans." It requires monthly payments of $4,732, and provides that "the Lender may transfer this Note. The Lender or anyone who takes this Note by transfer and who is entitled to receive payments under this Note is called the 'Note Holder.'"
Clerk's Papers at 655.
Id.
The deed of trust identifies the trustee as Stewart Title, the lender as First Horizon Corporation d/b/a First Horizon Home Loans, and the beneficiary and "nominee for Lender and Lender's successors and assigns" as Mortgage Electronic Registration Systems, Inc. (MERS). With respect to the lender's interests and rights, the deed of trust states:
Clerk's Papers at 659.
The beneficiary of this Security Instrument is MERS (solely as nominee for Lender and Lender's successors and assigns) and the successors and assigns of MERS. This Security Instrument secures to the Lender: (i) the repayment of the Loan, and all renewals, extensions and modifications of the Note; and (ii) the performance of Borrower's covenants and agreements under this Security Instrument and the Note.
Clerk's Papers at 660.
The deed of trust describes MERS' interests and rights as follows:
Borrower understands and agrees that MERS holds only legal title to the interests granted by Borrower in this Security Instrument, but, if necessary to comply with law or custom, MERS (as nominee for Lender and Lender's successors and assigns) has the right: to exercise any or all of those interests, including, but not limited to, the right to foreclose and sell the Property; and to take any action required of Lender including, but not limited to, releasing and canceling this Security Instrument.
Id.
The deed of trust also provides that it and the note can be sold without notice:
The Note or a partial interest in the Note (together with this Security Instrument) can be sold one or more times without prior notice to Borrower. A sale might result in a change in the entity (known as the "Loan Servicer") that collects Periodic Payments due under the Note and this Security Instrument and performs other mortgage loan servicing obligations under the Note, this Security Instrument, and Applicable Law. There also might be one or more changes of the Loan Servicer unrelated to a sale of the Note. If there is a change of the Loan Servicer, Borrower will be given written notice of the change which will state the name and address of the new Loan Servicer, the address to which payments should be made and any other information RESPA requires in connection with the transfer of servicing.
Clerk's Papers at 669.
With respect to the trustee, the deed of trust provides:
In accordance with Applicable Law, Lender may from time to time appoint a successor trustee to any Trustee appointed hereunder who has ceased to act. Without conveyance of the Property, the successor trustee shall succeed to all the title, power and duties conferred upon Trustee herein and by Applicable Law.
Clerk's Papers at 670.
In April 2010, Grant stopped making payments on the loan. Quality Loan Service Corporation of Washington (Quality) issued a notice of default on July 15, 2010. Quality identified itself as the agent for the "current owner/beneficiary of the Note secured by the Deed of Trust":
The Bank of New York Mellon f/k/a The Bank of New York, as Trustee for the holders of the Certificates, First Horizon Pass-Through Certificates Series FH05-01, by First Horizon Home Loans, a division of First Tennessee Bank National Association, Master Servicers, in its capacity as agent for the Trustee under the Pooling and Servicing Agreement c/o MetLife Home Loans a division of MetLife Bank NA.(We refer to this conglomeration as BNYM).
Clerk's Papers at 293.
Grant wrote to First Horizon several times before and after the notice of default to request a "standstill" of his payments while he attempted to sell the home. He received no favorable response.
On July 20, 2010, MERS recorded an assignment to BNYM of the deed of trust "together with the Promissory Note secured by said Deed of Trust". On September 10, 2010, BNYM appointed Quality as successor trustee of the deed of trust. In this capacity, Quality issued a notice of trustee's sale on September 28, 2010. The notice set a sale date of January 7, 2011.
Clerk's Papers at 300.
Grant filed a complaint in Whatcom County Superior Court seeking to enjoin the trustee's sale. He also asked the court to declare the note and deed of trust void, quiet title in his favor, and award damages and attorney fees.
Grant's complaint focused, in large part, on the conduct of First Horizon and Stewart Title during the closing of his loan in December 2004. He alleged he had signed the note and deed of trust under duress. He also argued that, as a result of his wife being made a co-owner of the property, he had been "unable to use, sell or otherwise deal with the [p]roperty" before the market collapsed, causing him to lose money.
Clerk's Papers at 229-30.
Grant also alleged several irregularities in the transfers and assignments of the note and deed of trust. Among other things, he alleged that MERS, as "nominee" for the beneficiary, had no authority to transfer or sell the note or deed of trust. Grant also alleged MERS' purported assignment of the note to BNYM was invalid because MERS has never been the holder of the note. Additionally, Grant claimed that BNYM's designation of Quality as its agent and its subsequent appointment of Quality as successor trustee were invalid, and that Quality could not be appointed as trustee in any event because Stewart Title had never resigned that role. Accordingly, Grant argued, none of the defendants had authority to foreclose.
Based on these allegations, Grant asserted causes of action for (1) breach of contract; (2) bad faith/"breach of duties"; (3) intentional infliction of emotional distress; (4) interference with contractual relations; (5) negligence; and (6) violation of various statutory requirements. Grant also asserted several affirmative defenses, presumably to the enforcement of the note and deed of trust, including "wrongful conduct, undue influence and duress." On November 5, 2010, the trial court granted Grant's request for a temporary restraining order enjoining the trustee's sale.
Clerk's Papers at 241.
First Horizon, Stewart Title, and Quality each filed motions to dismiss under CR 12(b)(6) or CR 12(c), arguing that most of Grant's claims were based on conduct occurring in 2004 and therefore barred by the statutes of limitation. Quality and First Horizon also argued that Grant's claims for intentional infliction of emotional distress, bad faith/breach of duty, Consumer Protection Act (CPA) violations, "wrongful foreclosure, " and negligence failed on their merits.
After argument on the motions, the court concluded the statute of limitations had run on the claims of intentional infliction of emotional distress, on the interference with contractual relationship, negligence, and CPA claims. The court also indicated defendants were entitled to judgment on the breach of contract and wrongful initiation of foreclosure claims. The court directed the parties to submit a proposed order conforming to its ruling.
The court noted, however, that Grant may have a cause of action for wrongful foreclosure if the property is eventually lost at a trustee sale.
Before the hearing on the proposed orders, Grant moved to amend his complaint to add First Tennessee Bank National Association and The Bank of New York Mellon as defendants. In his proposed amended complaint, Grant alleged that the discovery rule and the doctrine of equitable tolling applied to save his claims from the statute of limitations. He also asserted a new affirmative defense of recoupment and new causes of action, including violations of the Uniform Commercial Code (UCC) and the Truth in Lending Act (TILA), breach of Stewart Title's "express agreement to hold the Quitclaim Deed in their file, " and civil fraud.
Clerk's Papers at 70.
Though no order had yet been entered, Grant also filed a motion for reconsideration on grounds that the statute of limitations had been tolled.
At the February 4, 2011 hearing on the proposed orders, the court noted that any motion for reconsideration was premature. The court then signed an order granting the defendants' motions. Grant did not seek reconsideration. He now appeals.
DISCUSSION
Standard of Review
An order dismissing a claim under CR 12(b)(6) or CR 12(c) is reviewed de novo. Dismissal under CR 12 is appropriate only if "'it appears beyond doubt that the plaintiff cannot prove any set of facts to justify recovery.'" In making this determination, "'a plaintiff's allegations are presumed to be true and a court may consider hypothetical facts not included in the record.'" CR 12(b)(6) motions "should be granted 'sparingly and with care' and 'only in the unusual case in which plaintiff includes allegations that show on the face of the complaint that there is some insuperable bar to relief.'"
Burton v. Lehman, 153 Wn.2d 416, 422, 103 P.3d 1230 (2005).
Id. (quoting Tenore v. AT&T Wireless Servs., 136 Wn.2d 322, 330, 962 P.2d 104 (1998)); Pasado's Safe Haven v. State, 162 Wn.App. 746, 752, 259 P.3d 280 (2011).
Burton, 153 Wn.2d at 422 (quoting Tenore, 136 Wn.2d at 330)).
Tenore, 136 Wn.2d at 330 (quoting Hoffer v. State, 110 Wn.2d 415, 420, 755 P.2d 781 (1988)).
Deeds of Trust Act
Quality issued the notice of default as an agent of BNYM, which it identified as the current owner/beneficiary of the note. In his complaint, Grant alleged it was not clear that either BNYM or Quality had any right to issue the notice of default or the notice of trustee sale that followed.
Under the deeds of trust act (DTA), chapter 61.24 RCW, the trustee must "have proof that the beneficiary is the owner of any promissory note or other obligation secured by the deed of trust" before issuing a notice of trustee's sale. Thus, if BNYM is not the owner of the note, then neither it nor Quality as its agent and/or trustee had authority to foreclose, and the initiation of that proceeding was unlawful.
The record indicates that BNYM acquired whatever interest it has in the note and deed of trust by assignment from MERS. But nothing in the record establishes that MERS had any interest in the note to convey. The note makes no mention of MERS. It identifies only "First Horizon Corporation d/b/a First Horizon Home Loans" as the "Note Holder." There is no evidence that First Horizon transferred the note to MERS or BNYM.
Clerk's Papers at 655.
Quality argues the DTA does not require it to prove its authority to file the notice of default before doing so. That may be so, but that does not change the requirement that Quality must in fact be authorized to act on behalf of the beneficiary. Grant put Quality's authority in question by filing suit to resist the foreclosure, and the question remains unanswered. Dismissal of this claim on a CR 12(b)(6) or CR 12(e) motion was therefore improper.
We note, however, that subsequent amendments to the DTA include such a requirement as part of the foreclosure mediation program. See RCW 61.24.163 (8)(b)(iii).
Grant also alleged Quality violated the DTA because it issued the notice of default as an agent of BNYM before BNYM had acquired any interest in the deed of trust. The notice of default was issued on July 15, 2010. The assignment by MERS to BNYM did not occur until July 20, 2010.
In a somewhat similar scenario, the Massachusetts high court held that foreclosures were invalid. In U.S. Bank National Association v. Ibanez, the court addressed two cases in which banks foreclosed on properties and purchased them back at the foreclosure sales. The banks then filed complaints to clear title, requiring them to establish the validity of the foreclosure sales. The banks were not the original mortgagees, but claimed they had been assigned the mortgages though a complex securitization process. But the only evidence available indicated the banks acquired the mortgages by assignment only after the foreclosure sales occurred, and thus had no interest at the time of the foreclosure sale. Accordingly, the banks were not permitted to quiet title. Likewise here, the only evidence indicates that BNYM acquired an interest in the deed of trust only after commencing the foreclosure process.
458 Mass. 637, 941 N.E.2d 40 (2011).
Id. at 645.
Id. at 640-45.
Quality distinguishes Ibanez on the basis that it applies Massachusetts, not Washington, law. But the court's principal holding was that "the foreclosing entity must hold the mortgage at the time of the notice and sale in order to accurately identify itself as the present holder in the notice and in order to have the authority to foreclose under the power of sale." This proposition is consistent with Washington law.
Id. at 651.
See, e.g., RCW 61.24.030(7)(a) (requiring that "before the notice of trustee's sale is recorded . . . the trustee shall have proof that the beneficiary is the owner of any promissory note or other obligation secured by the deed of trust").
Quality also characterizes Grant's argument as a challenge to the timing of the recordation of MERS' assignment to BNYM of the deed of trust. Quality argues there is no requirement under Washington law for a deed of trust assignment to be recorded before a foreclosure can be initiated. But recordation is not the issue. The question here is whether BNYM was entitled to foreclose. This requires a determination of whether MERS had any interest in the note it purported to assign to BNYM (or whether BNYM obtained the note through some other means), and whether this transfer occurred before the notice of default was issued.
If Quality lacked authority to act because its principal BNYM had no interest in the note, then the foreclosure proceedings were contrary to the DTA. Thus, Grant's complaint contains allegations sufficient to survive CR 12 motions to dismiss. We therefore reverse the dismissal of this claim and remand for further proceedings.
A related issue is whether MERS can serve as a lawful beneficiary of the deed of trust under these circumstances. The DTA defines "beneficiary" as "the holder of the instrument or document evidencing the obligations secured by the deed of trust, excluding persons holding the same as security for a different obligation."RCW 61.24.005(2). The documents here establish that MERS did not hold the note; First Horizon did. Whether MERS can act as a beneficiary without holding the note is a question currently pending before the Washington Supreme Court. See Bain v. Mortg. Elec. Registration Sys., et al., No. 86206-1; Selkowitz v. Litton Loan Servicing, LP, et al., No. 86207-9.
At oral argument, Quality's counsel faulted Grant's failure to identify the specific statutory provision he claimed had been violated. Unlike its federal counterpart, CR 12 does not require such detail. CR 12 does not permit dismissal of a claim as long as there is some hypothetical set of facts that could justify relief. See McCurry v. Chevy Chase Bank, FSB, 169 Wn.2d 96, 101-03, 233 P.3d 861 (2010).
Wrongful Foreclosure
Grant next argues the court should not have dismissed his damages claim for wrongful foreclosure under the DTA. He cites no provision of the DTA and no case law recognizing such a cause of action. In Vawter v. Quality Loan Service Corp., a federal district court concluded that none exists under Washington law. We agree.
707 F.Supp.2d 1115 (2010).
In Vawter, homeowners filed suit under the DTA to enjoin a foreclosure. They alleged many of the same deficiencies in the foreclosure process that Grant alleges here. Like Grant, the Vawters also alleged a number of tort claims, wrongful foreclosure, and violations of the TILA and CPA. Because, like Grant, the Vawters were successful in halting the trustee's sale, at least temporarily, the court considered their claim one for "wrongful institution of nonjudicial foreclosure proceedings." The court identified four reasons the claim failed as a matter of law.
Id. at 1120.
Id. at 1123.
First, no provision of the DTA establishes a cause of action for wrongful institution of foreclosure proceedings. "Standing alone, the fact that the DTA establishes procedures and requisites for the nonjudicial foreclosure process does not necessarily give rise to a cause of action."
Id.
Second, the DTA provides a comprehensive scheme for the nonjudicial foreclosure process, including specific remedies. "Interjecting a cause of action for damages for wrongful institution of nonjudicial foreclosure proceedings into the DTA's scheme would potentially upset the balance struck by the legislature." Further, the court reasoned, if the legislature wished to permit a cause of action for damages, it could easily have done so.
Id. (citing Udall v. T.D. Escrow Servs., Inc., 132 Wn.App. 130, 190 P.3d 908 (2006)).
Id. We note that the legislature amended the DTA in 2009 to provide that a borrower/grantor does not waive certain claims for damages by failing to bring a civil action to enjoin a foreclosure sale. RCW 61.24.127; Laws of 2009, ch. 292 § 6. However, the provision contemplates that such an action would arise only after a foreclosure sale has occurred. RCW 61.24.127(2)(a) ("The claim must be asserted or brought within two years from the date of the foreclosure sale."); RCW 61.24.127(2)(c) ("The claim may not affect in any way the validity or finality of the foreclosure sale.").
Third, recognizing a cause of action for damages for wrongful institution of foreclosure proceedings would undermine one of the goals of the DTA, "that the nonjudicial foreclosure process should be efficient and inexpensive." Allowing grantor/borrowers to sue for damages for attempted wrongful foreclosure would increase the expense and inconvenience of the nonjudicial foreclosure process "while at the same time failing to address directly the propriety of the foreclosure or advancing the opportunity of interested parties to prevent wrongful foreclosure."
Vawter, 707 F.Supp.2d at 1123; see also Plein v. Lackey, 149 Wn.2d 214, 228, 67 P.3d 1061 (2003).
Vawter, 707 F.Supp.2d at 1124.
Finally, the Vawter court observed that even if such a cause of action existed, "this court is not persuaded that it could be maintained without a showing of prejudice." The Vawters failed to allege in their complaint that they suffered prejudice as a result of the defendants' actions.
Id.
Grant asks this court to distinguish Vawter because it was decided by a federal court that relied to some extent on unpublished opinions by Washington courts. But the Vawter court's reference to unpublished decisions does not undermine its reasoning, which is sound and pertinent to this case.
Grant also suggests that, unlike the Vawters, he can establish prejudice from wrongful institution of foreclosure proceedings. He contends even the initiation of the foreclosure process diminishes his ability to preserve any of the equity in the home. He relies on BFP v. Resolution Trust Corp., a fraudulent transfer case wherein the United States Supreme Court noted that "property sold within the time and manner strictures of state-prescribed foreclosure is simply worth less than property sold without such restrictions." But any damage in this case is wholly speculative, as the house has not yet been sold. Further, whatever diminution of value is attributable to the home's appearance on foreclosure lists would have occurred after proper initiation of foreclosure proceedings as well. Thus, Grant's own admitted default is the cause of his damages.
511 U.S. 531, 114 S.Ct. 1757, 128 L.Ed.2d 556 (1994).
Because there is no cause of action for wrongful initiation of foreclosure proceedings, the court properly dismissed that claim.
Breach of the Duty of Good Faith
Grant next contends that all parties owed him the duty of good faith and breached that duty. Under RCW 61.24.010(4), a trustee "has a duty of good faith to the borrower, beneficiary, and grantor." Grant relies on Albice v. Premier Mortgage Services to argue that a trustee's duty of good faith includes the duty to "take reasonable and appropriate steps to avoid sacrificing the debtor's interest in the property." He contends Stewart Title and Quality breached this duty because "[n]either . . . obtained an appraisal of the Property." Presumably, Grant believes the failure to obtain an appraisal will result in the trustee accepting a low bid at auction. This possibility is too speculative to establish a claim of bad faith. Dismissal was appropriate.
Grant also contends that Stewart Title and First Horizon owed him fiduciary duties and breached them. But he expressly abandoned this claim below:
Plaintiff did not intend to suggest in the Complaint that any of the Defendants owe him fiduciary duties. . . . [T]he word 'fiduciary' was incorrectly used in paragraph 7.6 of the Complaint and is hereby withdrawn. However, as pointed out in the aforementioned prior Motion, the law is clear that the Quality Loan owes the Plaintiff the duties of good faith and fair dealing, the duty to act impartially, and the duty to avoid sacrificing the Plaintiff's equity.Clerk's Papers at 156. Although Grant attempts to resurrect the claim on appeal, we are aware of no authority that would permit him to do so. We therefore decline to address it.
157 Wn.App. 912, 934, 239 P.3d 1148 (2010), rev. granted, 170 Wn.2d 1029, 249 P.3d 623 (2011).
Appellant's Br. at 36.
Violation of CPA
Grant contends his complaint was adequate to state a claim under the CPA, chapter19.86 RCW. Although his complaint alleged CPA claims against First Horizon, Stewart Title, and "Defendants, " his arguments on appeal pertain only to Quality.
To prevail on a private CPA claim, a plaintiff must establish (1) an unfair or deceptive act or practice; (2) that occurs in trade or commerce; (3) a public interest; (4) injury to the plaintiff; and (5) a causal link between the unfair or deceptive act and the injury suffered. The failure to establish any of the five elements is fatal to a CPA claim.
Indoor Billboard/Washington, Inc. v. Integra Telecom, 162 Wn.2d 59, 74, 170 P.3d 10 (2007).
Id.
"Unfair or deceptive act or practice" is not defined by the CPA. It is a question of law whether an alleged act is unfair or deceptive. Consumers may establish an unfair or deceptive act by showing "either that an act or practice 'has a capacity to deceive a substantial portion of the public' or that 'the alleged act constitutes a per se unfair trade practice.'" "Implicit in the definition of 'deceptive' under the CPA is the understanding that the practice misleads or misrepresents something of material importance."Whether an unfair act has the capacity to deceive a substantial portion of the public is a question of fact.
Holiday Resort Community Ass'n v. Echo Lake Assocs., LLC, 134 Wn.App. 210, 226, 135 P.3d 499 (2006).
Saunders v. Lloyd's of London, 113 Wn.2d 330, 344, 779 P.2d 249 (1989) (quoting Hangman Ride Training Stables, Inc. v. Safeco Title Co., 105 Wn.2d 778, 785-86, 719 P.2d 531 (1986)).
Holiday Resort, 134 Wn.App. at 226.
Id. at 226-27.
Grant contends Quality's conduct in issuing the notice of default before it had authority to do so and without proving or even investigating the requisite facts "is deception." He does not argue that this conduct had the capacity to deceive a substantial portion of the public. Instead, Grant attempts to show a "per se" violation by reference to the 2011 "Foreclosure Fairness Act" amendments to the DTA. These amendments establish a mediation program and require lenders to mediate in good faith. Among other things, lenders must provide "[p]roof that the entity claiming to be the beneficiary is the owner of any promissory note or obligation secured by the deed of trust." Failure to do so is a per se violation of the CPA.
Appellant's Br. at 38.
Id. at 39-41.
Grant agues the 2011 amendments are retroactive. A statute is presumed to operate prospectively unless the legislature indicates otherwise. This presumption can be overcome only if the legislature explicitly provides for retroactivity, the amendment is curative, or the statute is remedial. Grant contends the amendments apply retroactively because they are remedial.
Densley v. Dep't of Ret. Sys., 162 Wn.2d 210, 223, 173 P.3d 885 (2007).
Id.
"'A remedial statute is one which relates to practice, procedures and remedies.'" Such a statute will be applied retroactively "unless it affects a substantive or vested right." But because the 2011 amendments provide a cause of action for the lender's failure to provide documentation that it was not previously required to provide, they affect a substantive right. It would be inappropriate to apply the amendments retroactively.
Id. (quoting State v. McClendon, 131 Wn.2d 853, 861, 935 P.2d 1334 (1997)).
Id.
Because Grant has established neither a per se CPA violation nor the capacity of Quality's conduct to deceive a substantial portion of the public, the trial court properly dismissed the CPA cause of action.
Truth in Lending Act
Grant also argues the court improperly dismissed his claims under TILA and its regulations. Grant made no such claim in his complaint, though he made reference to TILA violations in his opposition to defendants' motions and in response to their replies. Although Grant attempted to amend his complaint to add a TILA claim, that motion was denied. The court did not dismiss any TILA claim because none was made. Accordingly, there was no error.
15 U.S.C. § 1635(b); 12 C.F.R. § 226.
In the latter of these pleadings, Grant points out that the provision he contends has been violated "went into effect January 1, 2011, " well after the notice of default was issued here. Clerk's Papers at 102.
UCC Defenses
Grant contends he is entitled to defend against the foreclosure and pursue a claim in recoupment on the basis of the duress and undue influence he allegedly suffered at closing. We disagree.
Grant obtained the loan to refinance an outstanding construction loan. He contends he closed the loan under duress because he was required to sign a quitclaim deed and documents reflecting that his wife would also be on title. Grant objected, but decided to make these changes because he was afraid of "the threat of mortgage rates significantly rising" and had "other strains concurrently happening" in his life.
Clerk's Papers at 229.
As the trial court accurately observed, "That's not duress. That's a business decision." Grant responded, "[I]n hindsight, I agree." The court did not err by dismissing the duress defense. With respect to dismissal of his remaining defenses, Grant presents no argument or authority that the court's decision was in error. We therefore decline to address them.
RP (Jan. 14, 2011) at 24.
Id.
Grant likewise fails to provide any argument to support his claim that duress, undue influence, fraud and fraudulent concealment entitled him to quiet title. We also do not address that issue.
Statute of Limitations
Many of Grant's claims centered on the December 1, 2004 loan closing transaction and the requirement that Grant execute a quitclaim deed and that his wife sign the loan documents. These included intentional or negligent infliction of emotional distress, negligence, interference with contractual relations, breach of contract, bad faith and some components of his CPA claims.
The tort claims are subject to a three-year statute of limitations. The breach of contract claim against Stewart Title that was based on a purported oral agreement not to file the quitclaim deed is also subject to a three-year statute of limitations. The CPA claims are subject to a four-year limitations period.
Sabey v. Howard Johnson & Co., 101 Wn.App. 575, 592, 5 P.3d 730 (2000) (negligence); Cox v. Oasis Physical Therapy, PLLC, 153 Wn.App. 176, 192, 222 P.3d 119 (2009) (intentional infliction of emotional distress); City of Seattle v. Blume, 134 Wn.2d 243, 251, 947 P.2d 223 (1997) (interference with business expectancy/contractual relations); 29 David K. DeWolf, Washington Practice: Washington Elements of an Action § 3:6, at 54 (2011-12 ed.); RCW 4.16.080(2).
The defendants moved to dismiss these claims for failure to file within the limitations period. In response, Grant argued that the "interference causes of action arose and continued until Plaintiff was finally able (in 2009) to file a quitclaim deed after the divorce to restore Plaintiff's title to the property" and that losses and damage caused by that interference, from emotional distress, and from the violations of the CPA "continue to this day."
Clerk's Papers at 157.
The court concluded that "the statute of limitations has run on the claims of intentional infliction of emotional distress, on the interference with contractual relationship, negligence, [and] Consumer Protection Act claim[s]." Immediately thereafter, without mentioning the statute of limitations, the court also dismissed Grant's breach of contract and bad faith claims against Stewart Title and First Horizon.
RP (Jan. 14, 2011) at 27.
After the court's oral ruling but before the hearing in which the court would consider the parties' draft orders, Grant filed a motion for reconsideration. For the first time, Grant argued the statute of limitations did not bar his claims because the bad faith, intentional infliction of emotional distress, interference with contractual relations, negligence, and violation of statutory requirements claims involve ongoing tortious activity and that the continuing tort doctrine, equitable tolling, and discovery rule should apply. The court did not consider or rule upon the motion for reconsideration because "to the extent that there's been a motion for reconsideration before I've even entered the order, we are pulling the cart before the horse." Grant did not renew his motion once the court entered its order.
RP (Feb. 4, 2011) at 32.
Failure to raise an issue before the trial court precludes a party from raising the issue on appeal. Applicability of the discovery rule, equitable tolling, or the continuing tort doctrine was not properly raised below and is thus not properly before us. As Grant offers no other challenge to the statute of limitations, we conclude the court properly dismissed the claims arising from the 2004 loan closure.
Mavis v. King County Pub. Hosp. Dist. No. 2, 159 Wn.App. 639, 651, 248 P.3d 558 (2011); RAP 2.5.
Motion to Amend Complaint
Grant next challenges the court's denial of his motion for leave to amend his complaint to add parties and add fraud and fraudulent concealment claims. A court has broad discretion to grant or deny such a motion; the decision "'will not be disturbed on review except on a clear showing of abuse of discretion, that is, discretion manifestly unreasonable, or exercised on untenable grounds, or for untenable reasons.'"
Wilson v. Horsley, 137 Wn.2d 500, 505, 974 P.2d 316 (1999) (quoting State ex rel. Carroll v. Junker, 79 Wn.2d 12, 26, 482 P.2d 775 (1971)).
After a responsive pleading has been served, a party may amend a complaint "only by leave of court or by written consent of the adverse party." Leave to amend shall be freely given where justice so demands, but should not be granted where amendment would result in prejudice to the opposing party or be futile. The timing of a motion to amend is also relevant.
Horsley, 137 Wn.2d at 505-06.
See, e.g., Doyle v. Planned Parenthood of Seattle-King County, Inc., 31 Wn.App. 126, 639 P.2d 240 (1982)
The court did not articulate why it denied Grant's motion. But none of the proposed amendments was based on new information, and there was no reason the new parties and claims could not have been included in the original complaint. Grant waited until after the court's dispositive oral ruling to file the motion, so the court could reasonably have determined the motion was untimely or the delay was prejudicial to the defendants. We see no abuse of discretion.
Id. at 130-31 ("When a motion to amend is made after the adverse granting of summary judgment, the normal course of proceedings is disrupted and the trial court should consider whether the motion could have been timely made earlier in the litigation.").
Judicial Notice
Grant contends the court erred by refusing to accept the dissolution court's findings pertaining to the character of the property at issue. He offers no authority to suggest a court abuses its discretion in this way. Under ER 201(d), a court "shall take judicial notice if requested by a party and supplied with the necessary information." Grant does not assert that he was entitled to mandatory judicial notice or that he provided the court with the dissolution court's findings. Further, he alleges no prejudice. The court did not err.
Procedural Issues
Grant next contends neither First Horizon nor Quality have "standing" to bring a motion under CR 12(b)(6) or 12(c). This is nonsense. They were named defendants and as such were authorized to bring motions under CR 12.
Grant also argues that Quality's CR 12(c) motion was untimely when judged by the rule pertaining to motions for summary judgment. He provides no analysis or authority for the proposition that the motion should be so judged and asserts no prejudice even if the motion was untimely. Whatcom County local rules direct that all motions other than ones for summary judgment shall be filed and served no later than nine court days prior to the hearing. Quality's motion was filed and served by December 28, more than nine days before the January 14, 2011 hearing. There was no error.
See CR 56(c) (summary judgment motions must be filed at least 28 days before a hearing on the motion).
WCCR 77.2(d)(1).
CONCLUSION
The court erred in dismissing Grant's claims with respect to the authority of First Horizon and/or Quality Loans to commence foreclosure proceedings under the DTA. We therefore reverse and remand for further proceedings on that issue. In all other respects, we affirm.
Grant's request for attorney fees and costs on appeal under RAP 18.1 and RCW 11.96A.150(1) is denied. That statute, which pertains to trust and estate dispute resolution, does not apply here.