Leave to amend to state a UCL claim was properly denied in a mass action by defaulted home loan borrowers as the proposed amendment showed plaintiffs were improperly joined but alleged no facts to support the conclusion they were overcharged. The trial court properly denied plaintiffs leave to amend to state a UCL claim. The only “facts” plaintiffs offered to allege were conclusions: That defendant mortgage loan servicers had not credited payments correctly to plaintiff’s loan accounts or had charged their accounts with improper fees or charges in violation of Reg. X or Z. To show violation of Reg. X, plaintiffs had to allege at least that they notified the servicers of the alleged errors and the servicers failed to correct the errors. To show violation of Reg. Z, plaintiffs had to allege that the servicers owned the loans and did not merely service them. In addition, for out-of-state plaintiffs, they had to allege that the violations occurred in California since the UCL doesn’t have extra-territorial effect. Furthermore, the requested amendment showed that the 222 borrowers who filed these actions were improperly joined together. Under CCP 378, joinder is permissible only if the joined plaintiffs allege claims arising from the same transaction or occurrence or series of transactions or occurrences. Here, it was clear that the claimed Reg. X & Z violations occurred in different transactions on different loans to different borrowers.
California Court of Appeal, Second District, Division 4 (Willhite, J.); May 31, 2016; 2016 WL 3085551