La Paz Investments v. U.S. Bank CA4/2

INTRODUCTION

Defendant and appellant U.S. Bank National Association (U.S. Bank) appeals

from an order granting a preliminary injunction (Code Civ. Proc., § 904.1, subd. (a)(6))

against U.S. Bank’s foreclosure on deeds of trust securing about $40 million in

construction loans made by a predecessor bank, PFF Loan & Trust (PFF), and assumed

by U.S. Bank. Plaintiffs and respondents, La Paz Investments (La Paz) and the Maurer

Development Co. Money Purchase Pension Plan (the Maurer Plan), are junior lienholders

who contend U.S. Bank adversely modified their subordination agreements, causing U.S.

Bank to lose its senior priority.

In an action for declaratory relief, La Paz and the Maurer Plan (collectively

Maurer) seek permanently to enjoin U.S. Bank from foreclosing on real property in

Riverside County and for a declaration that U.S. Bank’s senior deeds of trust on the

properties should not maintain priority over Maurer’s junior deeds. In a separate action,

U.S. Bank seeks to quiet title and declaratory relief.

After a thorough review of the record, we do not find any material modifications

to the subordination agreements which increased the risk of default by…