A166830_20250827

Filed 8/27/25 Di Loreto v. Specialized Loan Servicing CA1/4

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FOUR

Theresa Di Loreto appeals from the judgment after the trial court granted a motion by Specialized Loan Servicing, LLC (SLS) for judgment on the pleadings on Di Loreto’s claims for fraud and negligent misrepresentation. She contends her fifth amended complaint adequately stated her claims and, to the extent it did not, she could have amended it to state valid claims. We find no error and affirm.

BACKGROUND¹

Di Loreto owned a property in Concord. In 2004, she obtained a first lien loan on the property from Chase Manhattan Mortgage Corporation (Chase). Di Loreto ran into financial problems as a result of the economic downturn in 2007 and 2008. Chase refused to consider a loan modification because Di Loreto had not defaulted. Di Loreto defaulted on the loan in June 2015 because her savings ran out and she wanted to be considered for a loan modification.

In August 2015, Di Loreto applied for a loan modification. Chase transferred servicing of the loan to SLS. Di Loreto informed SLS of her loan modification application with Chase. SLS asked her to provide more documents. Di Loreto provided the requested documents and heard nothing back for some time.

Di Loreto marketed the property in June 2016 and by early 2017 was in contract with a buyer for an amount that would have paid off the loan and left Di Loreto with a net gain. However, in January 2017, a notice of default was recorded on the property.² The buyers rescinded their purchase offer.

In March, SLS appointed a relationship manager named Mariela as Di Loreto’s single point of contact. Mariela and SLS then began giving Di Loreto confusing and conflicting information in calls and letters. On March 24, Mariela sent Di Loreto two letters, one asking her to provide additional documents within one month and another stating that SLS was reviewing her application and would contact her if it needed additional documents. The second letter further stated, “If this is your first review or if you have had a qualifying change in circumstance and you submit a complete loss mitigation application and SLS has not made a first notice or filing required by applicable law for any judicial or non-judicial foreclosure process SLS will not initiate foreclosure proceedings as permitted by applicable law or investor guidelines.” On March 30, Mariela sent another letter containing this same sentence.

On April 3, Mariela told Di Loreto by phone to provide some clarifying information. Di Loreto did so and tried to follow up with Mariela by phone, but Mariela did not return Di Loreto’s call. On April 8, Di Loreto spoke with a different person named Mary, who told Di Loreto they had all of Di Loreto’s documents. Mary said that she was moving the file to underwriting and that no sale would be recorded against the property while the file was under review. Di Loreto was unable to reach Mariela on April 10 but spoke to someone named Melvina. Melvina repeated Mary’s statements that nothing else was needed and no sale would be recorded against the property while the file was under review.

On April 14, Di Loreto was worried that a notice of trustee’s sale would be recorded so she hired an attorney to seek a temporary restraining order (TRO) enjoining it. When Di Loreto’s attorney gave notice of the TRO request to SLS, “Nabeel at Buckley Madole” — an attorney who represented himself as SLS’s counsel — told Di Loreto’s attorney that foreclosure proceedings were on hold and no further activity would take place, including the recording of a notice of trustee’s sale, while Di Loreto’s application was pending. Based on this conversation, Di Loreto’s attorney did not seek injunctive relief to stop the recording of a notice of trustee’s sale.

On April 20, SLS asked Di Loreto for additional documents by May 20. Di Loreto submitted the documents on May 16. Di Loreto then received another series of conflicting letters from SLS on May 25, May 30, June 16, and June 27, stating either that all documents had been received and nothing was needed or requesting additional documents. Each of these letters included the same sentence as the March letters about not initiating foreclosure proceedings if Di Loreto’s application was complete.

On June 26, Di Loreto sent SLS (including Mariela and her supervisor) a letter pointing out that SLS’s letters were confusing and that Mariela had not responded to Di Loreto’s calls since April.

SLS sent Di Loreto a letter on July 6 stating that an additional document was needed to complete her loan modification application.³ Finally, on July 7, SLS sent Di Loreto a last letter signed by Mariela. The July 7 letter stated, “If this is your first review or if you have had a qualifying change in circumstance and you submit a complete loss mitigation application after a SLS [sic] has made the first notice or filing required by applicable law for any judicial or non-judicial foreclosure process but more than 37 days before a foreclosure sale, SLS will not move for foreclosure judgment or order of sale, or conduct a foreclosure sale as permitted by applicable law or investor guidelines.”⁴

On July 12, a notice of trustee’s sale was recorded on the property based on the Chase loan. Had Di Loreto known that her loan modification application would not shield her from active foreclosure, she would have put the property back on the market or filed for bankruptcy to pay back the accumulated debt over time. She also would not have withdrawn her request for a TRO and would have pursued injunctive relief. Di Loreto’s income had recovered such that she could have made the monthly payments on the loan but could not reinstate the loan in one lump sum payment. Her attempts to sell the property were thwarted by the notice of default and notice of sale recorded on the property. Buyers would not pay fair market value because of the foreclosure documents recorded on the property.

In August, Di Loreto filed a complaint alleging, among other claims, violations of the Homeowner’s Bill of Rights (Civ. Code, § 2924 et seq.; HBOR).⁵ The trial court issued a TRO enjoining the foreclosure sale of the property. SLS removed the action to federal court, and the district court issued a preliminary injunction enjoining the foreclosure sale of the property on condition that Di Loreto make monthly payments. The district court later remanded the case to the trial court.

The case proceeded through several rounds of demurrers and amended complaints. Di Loreto filed a fifth amended complaint in June 2021 asserting claims based on the HBOR and the Unfair Competition Law (Bus. & Prof. Code, § 17200 et seq.; UCL) and for intentional misrepresentation (fraud) and negligent misrepresentation. In January 2022, the trial court granted SLS’s motion for judgment on the pleadings on the fraud and negligent misrepresentation claims. Later, in October 2022, the trial court granted SLS’s motion for judgment on the pleadings as to the other claims against SLS because, among other things, Di Loreto conceded that she had sold the property and paid off the loan.

The trial court issued a tentative ruling granting another defendant’s summary judgment motion. On November 16, 2022, the trial court withdrew the tentative ruling after Di Loreto reported that she had filed a voluntary dismissal of that defendant. There being no remaining causes of action against any party, the trial court entered judgment on November 29, 2022.

On December 20, 2022, Di Loreto filed a notice of appeal in which she stated that she was appealing from a November 16, 2022, judgment after an order granting a summary judgment motion. This appeal was assigned case number A166830 in this court.⁶

Di Loreto moved for an award of attorney’s fees under the HBOR. The trial court denied that motion on April 4, 2023. On June 2, 2023, Di Loreto filed a notice of appeal from that order, which was assigned case number A167961.

DISCUSSION

1. Appealability

SLS preliminarily contends that Di Loreto has not established that we have appellate jurisdiction because the notice of appeal in the record is blank. But the December 20, 2022, notice of appeal that Di Loreto cites as the operative notice of appeal is not blank. It states that Di Loreto appealed from a November 16, 2022, judgment after an order granting a summary judgment motion.

The description in the December 20, 2022, notice of appeal is technically incorrect. The judgment was entered on November 29, 2022, and was based on rulings granting motions for judgment on the pleadings and the voluntary dismissal of another defendant, not the tentative summary judgment ruling that the court withdrew. But giving the notice of appeal a liberal construction, as we must, and because SLS does not claim it was misled or prejudiced by the inaccuracy of the description in this notice of appeal, we deem it sufficient. (Cal. Rules of Court, rule 8.100(a)(2) [“The notice of appeal must be liberally construed.”]; K.J. v. Los Angeles Unified School Dist. (2020) 8 Cal.5th 875, 882 [rule 8.100(a)(2) “reflects the long-standing ‘ “law of this state that notices of appeal are to be liberally construed so as to protect the right of appeal if it is reasonably clear what [the] appellant was trying to appeal from, and where the respondent could not possibly have been misled or prejudiced” ’ ”].)

However, there is a procedural problem here, which is that Di Loreto’s briefing regarding her appeal from the judgment is filed under appeal No. A167961, which is the appeal from the post-judgment fees order. In appeal No. A166830, which is the appeal from the judgment, Di Loreto filed a civil case information statement in January 2023 but took no further action. As matters stand, Di Loreto has not pursued her appeal from the judgment and has raised irrelevant arguments regarding the judgment in her appeal from the fees order.

In the interests of deciding cases on the merits, we will not rely on these technical defects to affirm the judgment. To avoid the need for the parties to file a new copy of the record and re-file their briefing regarding the judgment under the correct case number, we consolidate these appeals on our own motion and treat the record and the briefs in appeal No. A167961 as having been filed in appeal No. A168830. (Silveira v. Las Gallinas Valley Sanitary Dist. (1997) 54 Cal.App.4th 980, 984 [appellate court may consolidate cases on its own motion].) We will therefore proceed to consider the merits of Di Loreto’s challenge to the judgment. But because Di Loreto’s briefing in appeal No. A167961 does not mention any challenge to the post-judgment fees order and Di Loreto has taken no action to pursue her appeal from the fees order in the last two and a half years, we treat that appeal as forfeited and affirm the order denying her request for fees. (In re A.C. (2017) 13 Cal.App.5th 661, 672–673 [points not raised by an appellant are forfeited].)

2. Judgment on the Pleadings

“In reviewing the trial court’s grant of the motions for judgment on the pleadings under Code of Civil Procedure section 438, subdivision (b)(1), we apply the same rules governing the review of an order sustaining a general demurrer. [Citation.] A defendant’s motion for judgment on the pleadings should be granted if, under the facts as alleged in the pleading or subject to judicial notice, the complaint fails to state facts sufficient to constitute a cause of action. [Citation.] We accept the complaint’s properly pleaded factual allegations as true and give them a liberal construction. [Citation.] We do not accept as true ‘any contentions, deductions or conclusions of fact or law contained therein.’ [Citation.] We review de novo, and ‘ “are required to render our independent judgment on whether a cause of action has been stated” ’ [citation], without regard for the trial court’s reasons for granting the motion.” (County of Orange v. Association of Orange County Deputy Sheriffs (2011) 192 Cal.App.4th 21, 32.)

Because the standard of review for judgment on the pleadings is the same as for an order sustaining a demurrer, several other pleadings rules apply here as well. “ ‘When a demurrer 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.” ’ ” ’ ” (People ex rel. Allstate Ins. Co. v. Discovery Radiology Physicians, P.C. (2023) 94 Cal.App.5th 521, 532–533.) “A request for leave to amend may be made for the first time on appeal.” (Jensen v. The Home Depot, Inc. (2018) 24 Cal.App.5th 92, 97.)

1. Fraud

Di Loreto contends that she adequately pleaded a claim for fraud or, to the extent her claim was inadequate, that she can amend it to state a valid fraud claim. To evaluate Di Loreto’s argument we must first determine exactly what kind of fraud claim Di Loreto has alleged, because different types of fraud claims have different elements. “ ‘The elements of fraud, which give rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or “scienter”); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.’ [Citations.]

“ ‘Promissory fraud’ is a subspecies of the action for fraud and deceit. A promise to do something necessarily implies the intention to perform; hence, where a promise is made without such intention, there is an implied misrepresentation of fact that may be actionable fraud.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638 (Lazar).) “The elements of promissory fraud . . . are: (1) a promise made regarding a material fact without any intention of performing it; (2) the existence of the intent not to perform at the time the promise was made; (3) intent to deceive or induce the promisee to enter into a transaction; (4) reasonable reliance by the promisee; (5) nonperformance by the party making the promise; and (6) resulting damage to the promise[e].” (Behnke v. State Farm General Ins. Co. (2011) 196 Cal.App.4th 1443, 1453 (Behnke).) “ ‘[S]omething more than nonperformance is required to prove the defendant’s intent not to perform his promise.’ [Citations.] To be sure, fraudulent intent must often be established by circumstantial evidence. Prosser, for example, cites cases in which fraudulent intent has been inferred from such circumstances as defendant’s insolvency, his hasty repudiation of the promise, his failure even to attempt performance, or his continued assurances after it was clear he would not perform. (Prosser, [Torts (5th ed. 1984) § 109,] pp. 764–765.) However, if [a] plaintiff adduces no further evidence of fraudulent intent than proof of nonperformance of an oral promise, he will never reach a jury.” (Tenzer v. Superscope, Inc. (1985) 39 Cal.3d 18, 30–31(Tenzer).)

“Each element of a fraud claim must be pleaded with specificity. [Citation.] ‘The specificity requirement means a plaintiff must allege facts showing how, when, where, to whom, and by what means the representations were made, and, in the case of a corporate defendant, the plaintiff must allege the names of the persons who made the representations, their authority to speak on behalf of the corporation, to whom they spoke, what they said or wrote, and when the representation was made.’ [Citation.] However, ‘the requirement of specificity is relaxed when the allegations indicate that “the defendant must necessarily possess full information concerning the facts of the controversy” [citations] or “when the facts lie more in the knowledge of the” ’ defendant. [Citation.] The specificity requirement serves two purposes: ‘to apprise the defendant of the specific grounds for the charge and enable the court to determine whether there is any basis for the cause of action.’ ” (Orcilla v. Big Sur, Inc. (2016) 244 Cal.App.4th 982, 1008.)

When discussing the sufficiency of her fraud claim, Di Loreto lists the elements of generic fraud set forth in Lazar. However, the three alleged misrepresentations that she cites as supporting her claim constitute commitments by SLS about its future actions, indicating that her claim is actually one for promissory fraud.⁷

First, the complaint alleges that on April 8 and 10, SLS’s employees Mary and Melvina told Di Loreto that no sale would be recorded while her file was under review. This constitutes an allegation of a false promise not to record a notice of sale pending a decision on her application.

Second, Di Loreto alleges that on April 14, SLS’s attorney, “Nabeel at Buckley Madole,” told Di Loreto’s attorney that foreclosure proceedings were on hold while her application was pending and that no further activity would occur. Di Loreto argues that this statement contained two actionable misrepresentations, one a statement that foreclosure proceedings were on hold, which Di Loreto construes as a statement about the status of the loan, and one about SLS’s intent not to proceed with foreclosure in the future while her application was pending. This characterization is contrary to her complaint, where she summarized her fraud cause of action and made clear that its allegations rested on SLS’s representations regarding its future conduct: “From March 24, 2017 through at least July 6, 2017, as set forth in detail above, Defendant SLS repeatedly, orally and in writing, represented to Plaintiff that her loan modification application was complete and that it would not proceed with foreclosure while the loan modification process was complete and/or in progress.” (Italics added.) That aside, there is no material difference between the two representations that Di Loreto identifies. Nabeel made them both in response to Di Loreto’s counsel’s statement that she intended to seek a TRO preventing SLS from recording a notice of sale. Nabeel’s response as a whole was therefore prospective, since a statement only about SLS’s current foreclosure activity would have not dissuaded Di Loreto from seeking the TRO.⁸

Finally, on July 7, SLS sent Di Loreto a letter stating, “ ‘[I]f this is your first review or if you have had a qualifying change in circumstance and you submit a complete loss mitigation application after a SLS [sic] has made the first notice or filing required by application law for any judicial or non-judicial foreclosure process but more than 37 days before a foreclosure sale, SLS will not move for foreclosure judgement of order of sale.’ ” This statement, like the others, is one about SLS’s actions in the future, so it, too, amounts to a promise that Di Loreto contends was false.

Because the misrepresentations Di Loreto alleges all constitute false promises, we test the sufficiency of her complaint against the elements of promissory fraud set out in Behnke, supra, 196 Cal.App.4th at page 1453. We need not discuss all of the elements in detail because we conclude Di Loreto’s complaint fails to allege facts demonstrating that SLS had the intent not to perform its promises when it made them.

Because Di Loreto does not concede that her complaint alleges a claim for false promise, she does not expressly discuss the question of whether her complaint adequately alleges that SLS’s promises were false when made or argue that she could amend her complaint to address this element. Instead, she argues that she only needed to allege that SLS intended to induce her reliance on its misrepresentations. She contends her complaint satisfies this element by alleging that SLS intended to stop her from pursuing other foreclosure prevention alternatives. To the extent that more is required, Di Loreto offers that she could amend her complaint to allege that SLS was motivated to stop her from seeking injunctive relief preventing a foreclosure under the HBOR, as she had threatened, to avoid becoming liable for her attorney’s fees for such a suit under the HBOR’s fee-shifting provision.

The allegation that SLS intended for Di Loreto to refrain from pursuing foreclosure alternatives fails to allege with sufficient particularity that SLS did not intend to honor its promises when it made them. For starters, with the exception of Nabeel’s statement to Di Loreto’s counsel, Di Loreto’s complaint offers only the conclusory allegation that SLS intended to dissuade her from pursuing foreclosure alternatives, with no factual allegations specifically demonstrating such intent. That aside, SLS’s alleged intent to dissuade Di Loreto from pursuing alternatives does not demonstrate an intent to breach its promises not to record a notice of sale. The intent to dissuade Di Loreto from pursuing alternatives is equally consistent with SLS intending to perform its promises or to breach them. SLS could have believed that alternatives to foreclosure like bankruptcy or a TRO (two of the alternatives Di Loreto mentions) were unnecessary because it was not going to record a notice of sale, and it only recorded the notice of sale afterwards because of an internal miscommunication. SLS also could have believed it would grant Di Loreto’s loan modification application, so that bankruptcy or a TRO would only add costly delays without improving Di Loreto’s position. The only reason to infer from SLS’s attempt to dissuade Di Loreto from pursuing alternatives that SLS always intended to record a notice of sale comes from the fact that SLS later in fact recorded a notice of sale, which is insufficient. (See Tenzer, supra, 39 Cal.3d at pp. 30–31.) The allegation of SLS’s intent to dissuade adds nothing on this issue.

Moreover, accepting an inference of an intent not to perform a promise from facts showing an intent to induce reliance would make the intent not to perform element meaningless. Every plaintiff could argue that a defendant’s intent not to perform a promise could be inferred from the intent to induce a plaintiff’s reliance, which would cause the two elements of the tort to merge into one.

Di Loreto’s attorney’s fees theory also falls short. Di Loreto contends that after her counsel told SLS’s counsel on April 14 that she intended to seek injunctive relief to stop SLS from recording a notice of sale, SLS wanted to dissuade her from pursuing foreclosure alternatives because it wanted to avoid liability for attorney’s fees under the HBOR if Di Loreto were to obtain an injunction under section 2924.12, subdivision (a)(1). But the inference Di Loreto urges us to draw is not reasonable because even after SLS recorded a notice of sale Di Loreto could have obtained an injunction under the HBOR and recovered her attorney’s fees from SLS.

Section 2924.12, subdivision (a)(1) allows a borrower to bring a suit for an injunction enjoining a material violation of various provisions of the HBOR “[i]f a trustee’s deed upon sale has not been recorded.” One of the HBOR provisions that supports injunctive relief is section 2923.6, subdivision (c), which in 2017 prohibited a mortgage servicer from recording a notice of sale or conducting a sale while a borrower’s complete first lien loan modification application was pending. (Former § 2923.6, subd. (c), as amended by Stats. 2012, ch. 87, § 7.)⁹ Section 2924.12, subdivision (b), meanwhile, provides that “[a]fter a trustee’s deed upon sale has been recorded,” a borrower may sue a mortgage servicer for economic damages for material violations of provisions like section 2923.6. Section 2924.12, subdivision (h) allows a court to award reasonable attorney’s fees to a borrower who prevails in obtaining either injunctive relief or damages under the HBOR. (See also former § 2924.12, subd. (i), as amended by Stats. 2014, § 5 [identical fees provision in 2017 was located in section 2924.12, subd. (i)].)

These various statutory provisions demonstrate that even if SLS could have avoided liability for Di Loreto’s attorney’s fees in a suit to enjoin the recording of a notice of sale by lulling her into not filing the suit, it would mean little. By statute, SLS would have had to wait at least 20 days after posting, mailing, and recording the notice of sale before it could hold the sale. (§ 2924f, subd. (b)(1)–(4).) Di Loreto would therefore have had ample time to file a suit for an injunction enjoining SLS from conducting a sale, and SLS could have been liable for her fees in such a suit. Even if SLS managed to hold the sale before Di Loreto could sue for an injunction, SLS would still face liability for attorney’s fees if Di Loreto sued for damages after the recording of a trustee’s deed upon sale. In short, because SLS’s liability for attorney’s fees or other relief did not depend on its ability to dissuade Di Loreto from filing suit before SLS could record a notice of sale, the possibility of avoiding liability for fees does not support an inference that SLS did not intend at the outset to perform on its promises not to record a notice of sale while considering Di Loreto’s loan modification application.

2. Negligent Misrepresentation

Our conclusion that the statements Di Loreto has alleged constitute false promises rather than misrepresentations of fact is dispositive of her claim for negligent misrepresentation. “Simply put, making a promise with an honest but unreasonable intent to perform is wholly different from making one with no intent to perform and, therefore, does not constitute a false promise. Moreover, we decline to establish a new type of actionable deceit: the negligent false promise.” (Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 159, fn. omitted.) Di Loreto does not challenge this legal principle. Instead, she repeats her assertion that Nabeel’s statement that foreclosure proceedings were on hold was a misrepresentation of the status of her loan and contends that she alleged that SLS misrepresented its policy regarding foreclosure activity. We have already explained ante why Di Loreto’s argument regarding Nabeel’s statement is unpersuasive. Di Loreto’s argument about SLS’s policy fares no better. A misrepresentation of policy is still a variety of false promise because a policy is itself simply a statement about how SLS will act in future foreclosure proceedings. A misrepresentation of policy, therefore, cannot support a cause of action for negligent misrepresentation.

DISPOSITION

The judgment is affirmed.

BROWN, P. J.

WE CONCUR:

STREETER, J.

GOLDMAN, J.

Di Loreto v. Specialized Loan Servicing, LLC, et al. (A167961)