how long is statue of limitation to sue my servicing company for a wrongful foreclosure
3 Answers from Attorneys
The problem is that there is no specific cause of action for wrongful foreclosure. What are commonly called wrongful foreclosures involve various underlying causes of action, that depend on what happened and the remedy the homeowner/ borrower seeks. That can vary from promissory estoppel, which does not involve a set aside of the sale, to a quiet title or cancellation of a trustee's deed that does involve a set aside of the sale.
Wrongful foreclosure may either be a tort or a contract action, depending upon the precise wrong alleged by the victim. Most generally, I believe the claim resembles a tort, such as the tort of conversion. Conversion, per se, is a tort affecting personal property, not real estate, but wrongful conversion has enough similarity to conversion that in most cases at least the statute of limitations for conversion would probably be found applicable. Code of Civil Procedure section 338(c) would then be applicable, and the limitations period would be three years, beginning to run from the date of the conversion, whether or not the aggrieved party knows of it, unless there has been a fraudulent concealment of the conversion.
If the victim absolutely needs a longer period of time, he may either attempt to show concealment of the wrongful foreclosure, or to allege the wrongful foreclosure in terms that make it clear that the claim is based upon breach of a conrtract. The statute of limitations for breach of a written contract is four years from date of the breach.
The cases on wrongful foreclosure in California do not precisely say whether it is a tort or a contract. For the most part, the cases show it being pled and discussed as though it is a tort of the ilk of conversion, but at least one case discusses recovery of attorney fees in a wrongful foreclosure action as though it were a contract suit. Therefore, I conclude that each wrongful foreclosure action requires further analysis of the claims being made to see whether they are based on contract or tort theory, but it's more likely a tort and hence the three-year statute of CCP 338(c) applies.
In the 4th line of my answer, I erroneously wrote "wrongful conversion" when I meant "wrongful foreclosure." Sorry for the mistake.
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