Venture

The trial court granted summary judgment to defendant William N. Lobel, reasoning that plaintiff Cadlerock Joint Venture, L.P. (Cadlerock), the assignee of a loan that had previously been secured by a junior real property lien, was barred by Code of Civil Procedure section 580d from obtaining a deficiency judgment against Lobel. 1 The senior and junior liens at issue were created contemporaneously when the loan originator structured a “piggyback” refinancing transaction, whereby Lobel executed two separate promissory notes and two accompanying deeds of trust both referencing the same real property. 2 Soon thereafter the originator assigned the smaller loan (and accompanying junior lien) to a purchaser in the secondary mortgage market. When Lobel defaulted on both loans, an assignee of the senior lien conducted a nonjudicial foreclosure, which extinguished the junior lien.

Section 580d “precludes a judgment for any loan balance left unpaid after the lender’s nonjudicial foreclosure under a power of sale in a deed of trust... on real property.” (Western Security Bank v. Superior Court (1997) 15 Cal.4th 232, 237 [ 62 Cal.Rptr.2d 243 , 933 P.2d 507 ].) On its face, section…