## Facts

- Genevieve West defaulted on her home loan serviced by JPMorgan Chase Bank, N.A., which had acquired the loan from Washington Mutual Bank through FDIC receivership.
- Chase offered West a Home Affordable Mortgage Program (HAMP) Trial Period Plan (TPP) with reduced payments.
- West alleged she timely made all required trial payments and continued making reduced payments thereafter, and that her qualifying representations remained accurate.
- Chase denied a permanent loan modification based on a HAMP net present value (NPV) result and stated it would provide NPV input values upon request and reevaluate if values were materially incorrect.
- West alleged she requested the NPV inputs but did not receive them; she later spoke with a Chase representative who allegedly said she could submit updated financial information and that no foreclosure sale was scheduled.
- Two days after that call, the property was sold at a trustee’s sale.
- West sued, asserting fraud, negligent misrepresentation, breach of written contract (TPP), promissory estoppel, unfair competition (Bus. & Prof. Code § 17200), and additional claims including conversion, to set aside/vacate a void trustee’s sale, slander of title, and quiet title.
- The trial court sustained Chase’s demurrer to the third amended complaint without leave to amend and entered judgment for Chase; West appealed.

## Issues

1. Whether the complaint adequately pleaded fraud and negligent misrepresentation based on alleged statements and omissions about HAMP reevaluation, NPV inputs, and foreclosure scheduling.
2. Whether a HAMP TPP can constitute an enforceable written contract requiring the servicer to offer a permanent modification when the borrower performs and representations remain true.
3. Whether the complaint stated promissory estoppel based on alleged promises regarding reevaluation and the absence of a scheduled foreclosure sale.
4. Whether an unfair competition claim was viable as derivative of the alleged tort and contract misconduct.
5. Whether the complaint adequately stated claims for conversion, setting aside or vacating a void trustee’s sale, slander of title, and quiet title.

## Decision

- The Court of Appeal affirmed in part, reversed in part, and remanded.
- Reversed the judgment as to fraud, negligent misrepresentation, breach of written contract, promissory estoppel, and unfair competition, holding those causes of action were adequately pleaded.
- Affirmed dismissal of conversion, to set aside or vacate a void trustee sale, slander of title, and quiet title.
- In recognizing a TPP as potentially enforceable, the court agreed with federal authority that a servicer must offer a permanent modification when the borrower satisfies TPP requirements and qualifying representations remain accurate.

## Legal Principles

- On demurrer, courts assume the truth of properly pleaded material facts and determine whether the pleading states a claim under any legal theory.
- Fraud must be pleaded with specificity, including what was said or written, when, where, to whom, by what means, and (for corporate defendants) by whom and with what authority; elements include misrepresentation, knowledge, intent, justifiable reliance, and damages.
- Negligent misrepresentation mirrors fraud’s structure but requires that the defendant lacked reasonable grounds for believing the statement true, rather than actual knowledge of falsity.
- Justifiable reliance is evaluated in light of the plaintiff’s knowledge and experience and may be adequately pleaded when alleged misstatements cause the plaintiff to forgo steps to prevent harm.
- A HAMP TPP may form an enforceable written contract; if the borrower executes the TPP, submits required documentation, makes trial payments timely, and representations remain true, the servicer may be obligated to offer a permanent modification.
- Promissory estoppel requires a clear promise, foreseeable and actual reliance, and resulting detriment; assurances regarding reevaluation and foreclosure timing can satisfy these elements at the pleading stage.
- Unfair competition claims may proceed when based on the same conduct that supports adequately pleaded tort or contract claims.
- Claims seeking to unwind a completed nonjudicial foreclosure sale or to obtain quiet title require independent legal and factual support; damages theories may survive even where sale-avoidance and title-based claims do not.

## Conclusion

The court held that a borrower who alleges full performance under a HAMP TPP and specific misrepresentations about the modification process and foreclosure timing can proceed on contract, tort, estoppel, and derivative unfair competition theories, but not necessarily on claims aimed at voiding the trustee’s sale or establishing title.


West v. JPMorgan Chase Bank, N.A., 214 Cal. App. 4th 780 (Ct. App. 2013)