In Jacksons v. Quality Loan Service Corporation of Washington, No. 72-16-3-1 (April 6, 2015), the Washington Court of Appeals (Division 1) affirmed the dismissal of a plaintiff’s claims against various entities connected with a planned nonjudicial foreclosure sale of her house. In so ruling, the court confirmed a number of procedures that together streamline mortgage foreclosure litigation: (1) documents referenced in debtor’s complaint or available from the county record’s office are properly considered in a motion to dismiss, (2) nonjudicial foreclosures are not claims, and (3) a declaration by the holder of the note satisfies Deed of Trust Act (DTA) proof requirements for nonjudicial foreclosure.
First, the court ruled that the trial court properly took judicial notice of the note, addendum, and an allonge because they were referenced in the complaint. The assignment of the deed of trust and recorded appointment of a successor trustee were subject to judicial notice because they were public records easily accessible through the King County Recorder’s Office. Slip op. at 5-6.
Next, the court dismissed a constitutional challenge to the DTA. The court noted that the claim was procedurally barred, but nevertheless confirmed that the DTA was constitutional. The court emphasized that nonjudicial foreclosures are different than claims: “a nonjudicial foreclosure is not made pursuant to a judgment but rather is one conducted under a power contained in a mortgage or a decree of foreclosure… Until a party challenges the foreclosure, there is no judicial involvement.” Slip op. at 8. The DTA allows nonjudicial foreclosures as a separate option from judicial process, not as a legal claim or quasi-judicial proceeding.
Finally, the court confirmed its recent holdings in prior cases to hold that a declaration by a holder of note is sufficient proof identifying the beneficiary and note holder to satisfy the DTA and allow a nonjudicial foreclosure to proceed. Slip. op. at 10, discussing RCW 61.24.030(7)(a).
Together, the three rulings in this opinion guide trial courts to streamline consideration of nonjudicial foreclosure challenges at the motion to dismiss stage of litigation.