California Appellate Tracker

Black Sky Capital, LLC v. Cobb

June 16, 2017

CCP 580d does not bar a creditor from suing a borrower to collect on a note secured by a junior lien that was extinguished by a non-judicial foreclosure of a senior lien, even if the creditor also held the senior lien on which it non-judicially foreclosed.

Disagreeing with Simon v. Superior Court (1992) 4 Cal.App.4th 63, this decision holds that CCP 580d does not bar a creditor holding a note secured by a junior deed of trust from suing the borrower on the note after the lien of the junior deed of trust is extinguished by a nonjudicial foreclosure sale under a senior deed of trust on the property. This is true, the decision holds, even when the same creditor holds both the foreclosed senior lien and the sold-out junior lien. Section 580d unambiguously bars recovery of a deficiency only on the loan secured by the deed of trust under which the nonjudicial foreclosure was held.

California Court of Appeal, Fourth District, Division 2 (McKinster, Acting P.J.); June 13, 2017; 2017 WL 2569710

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Black Sky Capital, LLC v. Cobb

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