In Yvanova v. New Century Mortgage Corporation, the Supreme Court today holds that defaulting homeowners have standing to challenge the validity of an assignment of the note and deed of trust on which a foreclosure is based.  The court’s unanimous opinion, written by Justice Kathryn Werdegar and with a Court of Appeal justice sitting pro tem in place of Justice Ming Chin, comes with a number of qualifications, stressing what the opinion itself labels a “narrow” ruling:

“We hold only that a borrower who has suffered a nonjudicial foreclosure does not lack standing to sue for wrongful foreclosure based on an allegedly void assignment merely because he or she was in default on the loan and was not a party to the challenged assignment.  We do not hold or suggest that a borrower may attempt to preempt a threatened nonjudicial foreclosure by a suit questioning the foreclosing party’s right to proceed.  Nor do we hold or suggest that plaintiff in this case has alleged facts showing the assignment is void or that, to the extent she has, she will be able to prove those facts.  Nor, finally, in rejecting defendants’ arguments on standing do we address any of the substantive elements of the wrongful foreclosure tort or the factual showing necessary to meet those elements.”

The court reverses the decision of the Second District, Division One, Court of Appeal.  Also it disapproves Court of Appeal opinions by the Fourth District, Division Three (issued in 2013), the Second District, Division Three (2013), the Fourth District, Division Two (2012), and the First District, Division One (2011).  Instead, the court agrees with a 2013 opinion by the Fifth District Court of Appeal.