A copy of the opinion is available at: http://www.courtinfo.ca.gov/opinions/documents/B221470.PDF
When plaintiffs became delinquent on their refinance home mortgage loan, a notice of default was served and recorded on the property. The notice identified a different beneficiary and trustee from those that were identified in the original deed of trust, but no substitution had been served or recorded showing the new trustee/beneficiary. A substitution was recorded evidencing the change in trustee before the nonjudicial foreclosure sale, but there was no recording showing substitution of the beneficiary until two months after the new trustee conducted the nonjudicial foreclosure sale.
The court acknowledged that a judgment arising from an unlawful detainer action generally is given limited res judicata effect, it pointed to the "qualified exception to the rule that title cannot be tried in unlawful detainer that is contained in Code of Civil Procedure section 1161a, which extends the summary eviction remedy beyond the conventional landlord-tenant relationship to include certain purchasers of property" in making its decision. More specifically, "Code of Civil Procedure section 1161a ... provides an unlawful detainer action may be filed '[w]here the property has been sold in accordance with Section 2924 of the Civil Code, under a power of sale contained in a deed of trust . . . and the title under the sale has been duly perfected.'"
Ralph T. Wutscher
Kahrl Wutscher LLP
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