Cases

Maria Ferra paid $1.6 million that she did not believe was owed, to stop a deed-of-trust holder from foreclosing on property Maria had sold to a third party under an indemnity and security agreement.  Maria then sued the deed-of-trust holder to recover the wrongfully-demanded money.  The trial court dismissed Maria’s suit on demurrer.  It found, among other things, that Maria lacked standing because she had sold the property after the deed-of-trust holder began demanding payment and she “voluntarily” obligated herself to indemnify the buyer.

Representing Maria on appeal, GMSR argued that she had standing to recover her money notwithstanding the property sale, and that her allegations that the deed-of-trust holder demanded $1.6 million, despite knowing that amount was not owed, supported her claims.  The Court of Appeal agreed.  It held that Maria had a concrete and actual interest in recovering her $1.6 million; she did not lose standing simply because she sold the property.  It further held that Maria stated claims for conversion, Penal Code section 496 extortion, and Civil Code section 1712 unlawful exaction, and revived those claims for further proceedings.

Court of Appeal Opinion – View Document