UTA is close to raising the necessary funds to file an amicus brief on behalf of Financial Title Company who acted as a trustee in the case of KB Properties vs. Financial Title Company, et. al. The Board’s approval of the amicus brief filing is conditioned upon the membership contributing sufficient funds for the preparation of a quality brief. UTA does not budget for the expense of filing amicus briefs in important cases and traditionally has solicited its members to support its efforts. (Member checks must be received no later than July 30, 2007 and $12,000 must be raised for the amicus brief to be filed.) We would anticipate filing an application for UTA to act as a friend of the court and presenting an amicus brief to the court of appeal sometime in October, 2007. If insufficient funds are raised to pay counsel for the preparation and filing of an amicus brief on UTA’s behalf by the deadline, no brief will be filed and any funds received will be rolled over into the UTA amicus fund for the next amicus project.

In the case of KB Properties vs. Financial Title Company, et. al. the trial court sustained a demurrer to the bidder’s complaint and the bidder refused to amend the complaint and chose to have the judgment of dismissal entered so the appeal could proceed immediately. The bidder purchased a commercial property for over One Million Dollars less than the fair market value at the date of sale. The case presents UTA with an opportunity to advance its assertion that the privilege provided to trustees for acts related to the foreclosure process contained in Civil Code Section 2924 includes the trustee’s recording a Notice of Rescission of a trustees deed upon sale (“TDUS”) after the deed has been delivered to the purchaser. The trial court ruled that the recording of the Rescission was privileged and defeated the claims alleged by the bidder for Slander of Title, Interference with Prospective Economic Advantage and Negligence.

It is critical that a brief is funded to support this effort. UTA will focus its arguments on the privilege issue and why it should apply when a trustee upon the beneficiary’s request is directed to record a rescission of a TDUS. The brief will focus on the trustee’s right to undertake its statutory responsibilities without being required to defend tort claims for actions which are authorized by statute.

UTA believes that a published court of appeal opinion upholding the decision will substantially reduce litigation from bidders in cases where the trustee is requested and authorized to rescind a TDUS after delivery and will reduce the cost of litigation in third party bidder litigation which is expensive and time consuming. Courts have already started to hold that the trustee’s actions in processing a foreclosure are privileged. Clarifying that the privilege extends to the recording of a rescission deed after a sale will great reduce litigation from bidders contending that trustees cannot defeat the rights of innocent third party bidders.

To support the filing by UTA of an amicus brief in this case, please make a check payable to “UTA Amicus Brief Fund” and mail your check to the UTA at 2030 Main Street, Suite 1300, Irvine, CA 92614.