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72 tion of the Note owner." ASC responded to the QWR providing the contact information for U.S. Bank, the trustee of the trust. During the bankruptcy, the Meyers and U.S. Bank stipulated to an order of relief from the stay on June 1, 2011. e loan was removed from the Meyers' plan, and the plan was confirmed. In May of 2012, NWTS recorded a new NOTS. TAKE TWO With another sale date looming, in July 2012, the Meyers filed an adversary complaint in the bankruptcy court. By October 2013, only NWTS remained as a defendant in the action, and a three-day bench trial commenced. e claims against NWTS were for violations of the Deed of Trust Act (DTA), the Washington State Consumer Protection Act (CPA), and the Fair Debt Collection Practices Act (FDCPA). During trial, NWTS asserted that the Meyers are barred from bringing these claims under the doctrine of judicial estoppel because they failed to include the claims as assets in their bankrupt- cy schedules. Judge Overstreet issued a memo- randum decision finding for the Meyers on the DTA and CPA claims, denying relief under the FDCPA and ignoring any argument regarding judicial estoppel. At the time of Judge Overstreet's decision, it was not clear as to whether or not a claim for a violation of the DTA survives if a foreclosure was not completed. Judge Overstreet decided that a cause of action under the DTA was permitted under the current case law. See Walker v. Qual- ity Loan Service Corporation of Washington., 176 Wn. App. 294, 308 P.3d 716 (2013); and Bavand v. OneWest Bank, FSB, 176 Wn. App. 475, 309 P.3d 636 (2013). Relying on Klem v. Washington Mutual Bank, 176 Wn.2d 771, 295 P.3d 1179 (2013), Judge Overstreet held that due to NWTS's inclusion of language in the NOD, asserting that it was acting as the agent for the beneficiary; NWTS, in not independently veri- fying the parties executing the declarations, had authority to execute, and the beneficiary was the actual owner of the note. By failing to include the contact information for the owner of the note in the NOD, NWTS breached its duty to the Meyers under the DTA. According to Judge Overstreet, NWTS's failure to strictly comply with the DTA was an unfair and deceptive act giving rise to a CPA claim. Putting the final nail in the coffin, Judge Overstreet determined that were it not for NWTS's faulty NOD, the Meyers would not have been forced to act. is started with the Meyers being required to hire an attorney to send the QWR, continued with the filing of the bankruptcy, extended to the cost of moving and paying for a rental, and also included lost wages for the time spent in mediations and hearings. THE APPEAL On April 10, 2015, U.S. District Court Judge Martinez reversed Judge Overstreet's decision. Between Judge Overstreet's decision and Judge Martinez's reversal, the case law concerning the DTA changed considerably. In that time, it was established that there was no independent action under the DTA without a completed foreclosure sale but that a violation of the DTA could still be actionable under the CPA. Frias v. Asset Fore- closure Services., Inc., 181 Wn.2d 412, 334 P.3d 529 (2014). Additionally, it was determined that a trustee's reliance on the beneficiary declarations in initiating a non-judicial foreclosure was not a violation under the DTA so long as there was no evidence conflicting the information in the dec- larations. Trujillo v. Northwest Trustee Services, Inc., 181 Wn. App. 484, 326 P.3d 768 (2014) (Reliance on the declarations is not a violation, absent conflicting evidence). Finally, there was no affirmative duty for a trustee to investigate if the beneficiary is the holder of the note. Bavand v. OneWest Bank, FSB, 587 F. App'x 392 (9th Cir. 2014). During the appeal, NWTS again argued that judicial estoppel barred the Meyers from bringing their claims against NWTS. e Court denied this argument relying on the fact that at the time the Meyers filed for bankruptcy, the law underlying the claims did not exist. Bain v. Metropolitan Mortgage Group, Inc., 175 Wn.2d 83, 285 P.3d 34 (2012); Klem (2013); Walker (2013); and Bavand (2013). erefore, to bar the claims would not be fair to the Meyers due to the constant shifting of DTA law. e court based its decision on what the Meyers knew at the time of filing their bankruptcy in 2010 and did not address any requirement for the Meyers to amend their schedules once the claims were known in 2012. Instead, the District Court reversed Judge Overstreet's decisions specifically as to each of the claims. e DTA claim was reversed based on Frias establishing there is no individual claim for a violation under the DTA. e CPA claim failed because the Meyers failed to establish how a technical error prejudiced them, harmed them, or was likely to deceive the public in order to give rise to a CPA claim. Most importantly, in light of the decision in Trujillo, the court determined that NWTS did not violate the DTA by relying on the beneficiary declarations. Finally, the District Court determined that the injury and damages either could not be proven to stem from NWTS's actions or simply were not recoverable under a CPA claim. THE FINAL DECISION Continuing the trend of ever-changing DTA law, on August 20, 2015, the Washington State Supreme Court reversed Trujillo in a decision referred to as Trujillo II. Trujillo v. Northwest Trustee Services, Inc., 183 Wn.2d 820, 355 P.3d 1100 (2015). In Trujillo II, the Supreme Court determined that the declaration of the note- holder was ambiguous because it stated that the beneficiary is the "actual holder of the promis- sory note or other obligation." (emphasis added). A trustee's reliance on an ambiguous declaration is a violation of the trustee's duty to the bor- rower and therefore a violation of the DTA. As a violation of the DTA, reliance on the declara- tion gives rise to a CPA claim. e beneficiary declaration used by NWTS to commence the Meyers' foreclosure also included this ambiguous language and could be deemed a violation of the DTA. NWTS would have to prove that they relied on additional information confirming the beneficiary was the owner of the note prior to the initiation of the foreclosure. After briefing by both sides, Ann T. Mar- shall, Esq., with Anglin Flewelling Rasmussen Campbell & Trytten LLP (AFRCT) filed an amicus curie brief on behalf of the UTA. Despite the 10 issues asserted by the Meyers, including the change in Trujillo II, the Ninth Circuit's majority memorandum decision is based solely on the issue of judicial estoppel. e Ninth Circuit finally agreed that the Meyers were barred from bringing claims against NWTS because they failed to amend their schedules after obtaining enough facts evidencing their potential claims against NWTS. Upon the filing of the adversary proceeding, the Meyers should have also amended their schedules in order to apprise the bankruptcy court and their creditors of the claims. With this decision, trustees could nip some costly and frivolous actions by borrowers in the bud. Once served with a complaint, a trustee, or their counsel, should first review a borrower's bankruptcy status and history. If, while they were in active bankruptcy, the borrower was aware of the facts giving rise to their claims their action should be dismissed. Ideally, the Ninth Circuit would have published this decision so that it could be used as precedent on future matters. Nonetheless, the cases cited in the decision and its rationale can be used to protect trustees in other matters within the Ninth Circuit.

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