James A. Krage
10418 Ives Street
Bellflower, California 90706
In Propria Persona

United States District Bankruptcy Court
Central District of California
Los Angeles, California

in re: James-Arthur : Krage,

--------------------------------------------------------
James-Arthur : Krage,
as an individual, as Real Party in Interest, as Sole Heir, and as Administrator of the Estate of Verna Gladys Kroemer Krage,
			Plaintiff,

	vs.

Christopher L. Boulter, an individual;
Val-Chris Investments, Inc., a corporation;
Bruce R. Beasley, an individual;
RESS Financial Corporation, a corporation;
All persons unknown, claiming any legal or equitable right, title, estate, lien, or interest in the property described in the complaint adverse to Plaintiff's title, or any cloud on Plaintiff's title thereto;
and DOES 1 THROUGH 5, inclusive,
			Defendants.
	Case No.: 2:08-bk-22336
     Chapter 13
Hon:Alan M.Ahart
Courtroom.: 1378

COMPLAINT TO INVOKE ADVERSARY PROCEEDING UNDER FRBP 7001(2) AFTER VIOLATIONS OF TRUTH IN LENDING ACT, FAIR DEBT COLLECTION PRACTICES ACT, ETC;
FOR JUDICIAL REVIEW OF RESCISSION AND/OR FOR CANCELLATION OF WRITTEN INSTRUMENTS (NOTE AND TRUST DEED), FOR QUIETING TITLE, FOR DECLARATORY JUDGMENT, AND FOR OTHER DAMAGES FOR:
1.	RESCISSION OR CANCELLATION FOR LACK OF CONSIDERATION
2.	RESCISSION FOR VIOLATION OF TILA NOTICE OF RIGHT TO CANCEL 
3.	VIOLATION OF 15 USC 1635(b):BY FAILURE TO RETURN MONEY AND ACCEPT RESTITUTION
4.	RESCISSION FOR PADDED CHARGES THAT ARE DECEPTIVE PRACTICES
5.	RESCISSION FOR FAILURE TO GIVE EACH ADULT RESIDENT HAVING EQUITABLE INTEREST A COPY OF THE LOAN DOCUMENTS
6.	CANCELLATION OF INSTRUMENTS  
7.	QUIET TITLE
8.	INJUNCTION
9.	DECLARATORY RELIEF
10.	FRAUD
11.	CONSTRUCTIVE FRAUD
12.	BREACH OF FIDUCIARY DUTY
13.	BREACH OF CONTRACT
14.	INTERFERENCE WITH CONTRACT
15.	UNJUST ENRICHMENT
16.	TRUST FUND MISHANDLING COMINGLING
17.	OTHER TILA VIOLATIONS
18.	RESPA VIOLATIONS
19.	FDCPA VIOLATIONS
20.	HOEPA VIOLATIONS
21.	VIOLATION OF FIN. CODE 4973(k)
22.	VIOLATION OF FIN CODE 22317.5
23.	ACCOUNTING
24.	NEGLIGENCE
25.	VIOLATION OF DUTY OF GOOD FAITH AND FAIR DEALING
26.	FALSE ADVERTISING B&P 17200 and 17500	

INTRODUCTORY ALLEGATIONS
1. 	Debtor/Plaintiff (hereinafter, “Debtor”) brings this action to request Adversary Proceeding during chapter 13 bankruptcy with federal questions to request validation of the alleged debt, request proof that the debt is secured after rescission, to reiterate and to enforce their rescission of subject predatory loan and recover for damages and other relief under the Truth In Lending Act (TILA) Fair Debt Collection Practices Act (FDCPA), the Real Estate Settlement Procedures Act (RESPA), and other Federal and State Laws.
2. 	Plaintiff hereby invokes 28 U.S.C. 1367 to grant this Court of Record additional Jurisdiction to adjudicate state issues also involved.
3. 	Debtor/Plaintiff is a consumer that lives within the jurisdiction of this Court, where their property is located and all relevant actions have taken place.
4. 	Plaintiff James-Arthur : Krage (hereafter, “Krage”) is, and at all times relevant hereto was, an native-born American, one of the people, born and domiciled in Los Angeles County, California.  Krage is the Sole Heir of the estate of Verna Gladys Kroemer Krage.   Krage is also Administrator of the Estate of Verna Gladys Kroemer Krage, with Letters granting full authority.  Krage, in his capacity as Administrator, signed the Loan Documents for the Estate.  Krage sues in his capacities as an individual, as Sole Heir, and as Administrator of the Estate.   Krage is the real party in interest.
5. 	Upon information and Belief, Defendant Christopher L. Boulter (hereafter “Boulter”) is, and at all times relevant hereto was, an individual domiciled in Orange County, California and President of Defendant Val-Chris Investments, Inc.  Boulter is sued in both his corporate and individual capacities.
6. 	Upon information and Belief, Defendant Val-Chris Investments, Inc (hereafter, “Val-Chris”) is, and at all times herein mentioned was, a California corporation, with its principal place of business in Irvine, Calif.  Upon further information and belief, Val-Chris owns, directs, and/or operates Val-Chris Escrow.
7. 	Upon information and Belief, Defendant Bruce R. Beasley (hereafter “Beasley”) is, and at all times relevant hereto was, an individual domiciled in southern California and President of Defendant RESS Financial Corporation.  Beasley is sued in both his corporate and individual capacities.
8. 	Upon information and Belief, Defendant RESS Financial Corporation (hereafter,  “RESS” or “RESS Financial”) is, and at all times herein mentioned was, a corporation with its principal place of business in Norco, Calif.  Upon further information and belief, RESS regularly acts as agent for Val-Chris in real property foreclosures.
9. 	Plaintiff is ignorant of the true names, capacities and relationships of all the defendants sued herein, including DOES 1 through 5, inclusive, and therefore sues all defendants by fictitious names.  Plaintiff will amend this Complaint to allege the true names, capacities and relationships of all Defendants, including DOE defendants when these become known.
10. 	Plaintiff alleges upon information and belief that each of the defendants named herein, including DOES l through 5, is responsible in some manner for the occurrences herein alleged, and that Plaintiff’s damages as alleged herein were directly and proximately caused by said defendants, including DOE Defendants.
VENUE
11. 	Venue is properly before this Court.  Most of the events, circumstances, damages and denial of rights described herein took place in Los Angeles County.
12. 	Upon information and belief Defendant Boulter is domiciled in Orange County and Defendant Beasley is domiciled in Riverside County or Orange County..
13. 	Upon information and belief, Defendants Val-Chris has its principal office in Orange County, RESS Financial has its principal offices in Riverside County and both do substantial business in Los Angeles County.
14. 	  The property in question, 10418 Ives Street, Bellflower, Calif. 90706, involving the Instruments requested to be cancelled for cause, is located in Los Angeles County.
15. 	The Instruments described below were executed in Los Angeles County, Calif.
16. 	There exists a certain written instrument that purports to be a promissory note. A copy of the note is attached to this complaint as Exhibit 1 and incorporated by reference.
17. 	  There exists a certain written instrument that purports to be a Deed of Trust related to the promissory note. A copy of the Deed of Trust is attached to this complaint as Exhibit 2 and incorporated by reference.
18. 	Both the Note and the Deed of Trust are:
a) rescindable for direct violations of TILA, including but not limited to a missing 3-day Notice of Right to Cancel after a delay in Consummation, inaccurate TILA Material Disclosures over the threshold after Foreclosure, lack or failure of consideration by a delay of about 3 months in payment of points to the Broker, consent was given without knowing about Defendants’ misrepresentation, concealment,  and fraud in the inducement, etc.
b) voidable for unilateral mistake, misrepresentation of a material fact, fraud in the inducement, concealment, duress (not knowing character of the transaction), undue influence, with unconscionable results: specifically, Misrepresentations in the Truth in Lending Act (hereinafter “TILA”) required Disclosures and for Breach of Contract, Breach of Fiduciary Duty, Negligence, Trust Fund Mishandling, and for other reasons, as specified below.

SHORT STATEMENT OF FACTS
19. 	This case is an attempt to limit a high cost predatory Lender who preys upon people of limited means through loans with unconscionably high interest rates and excessive padded fees.  Such predatory loans have a strong tendency to force people to leave their homes.  Indications are that the Lender never expected this loan to be repaid.  Instead the Lender expected to get Plaintiff’s house for much less than the fair market value of the house after extracting as much money as possible from the borrower in monthly payments, which money the Borrower was expected to pay in a desperate but futile attempt to avoid the inevitable.  The Lender has broken Federal laws, including TILA, RESPA, FDCPA, HOEPA, and has broken California laws, including the Calif. Finance Code and the Calif. Business & Professions Code.  The Lender flatly refuses to obey the rescission procedures specified in TILA.   The Lender acts in total disregard for Federal Law -- TILA, RESPA, FDCPA -- and with the assistance of a lawyer and a foreclosure agent appears to blatantly and willfully violate RESPA, FDCPA and TILA.   The Lender, in his lawyer’s letter of April 23, 2008, refuses Plaintiff’s Offer of Restitution of April 17, 2008 and makes a counteroffer.   Plaintiff should not be required to re-offer restitution after Defendants’ blatant refusal to accept an overt “Offer of Restitution”.   Without any Security Right after Rescission, the Lender is still attempting unlawful Foreclosure, and must be enjoined immediately from proceeding.  Exhibits 1 through 43 are incorporated here by reference. 

II.
ALLEGATIONS COMMON TO ALL CAUSES
20. 	On May 3, 2007, Plaintiff Krage signed a Promissory Note for $350,000 (Exhibit 1), a Deed of Trust (Exhibit 2), and other Documents in exchange for what Krage had been led to believe would be $350,000 that would be placed into an Escrow Account with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendants Boulter and Val-Chris.  The other documents included documents describing Broker fees, Escrow fees and other fees.
21. 	 The real property in question is Plaintiff Krage’s Principal Residence.
22. 	 The loan in question was primarily for non-commercial purposes.
23. 	 On May 10, 2007 Defendant Val-Chris wired only $330,866.13 to Southland Title for SLT Escrow account # AKA 1146-SLT2.  At that time, Plaintiff Krage did not know that SLT Escrow had only received partial funding.   Krage did not discover this until near the end of 2007, although he had requested it in QWRs multiple times.
24. 	 Later in May 2007, Plaintiff Krage discovered that the full Broker’s commission specified in the loan documents that Krage had signed on May 3, 2007 had not been paid to the Broker, SLT Mortgage.  Krage immediately sent Defendant Val-Chris Qualified Written Requests (hereinafter, “QWR”) under RESPA to address that issue and other issues.
25. 	 RESPA is the federal Real Estate Settlement Procedures Act, (12 USC §§2601-2617), Dept. of Housing and Urban Development Regulation X at 24 C.F.R. 3500, and the Gramm Leach Bliley Act.
26. 	 The QWRs, dated May 16, 2007 (see Exhibit 17) and May 17, 2007 (see Exhibit 18), asked why the Broker (SLT Mortgage) had not been paid, requested that Defendants not breach the loan contract, and requested that Defendants insure that the Broker was paid, so that Defendants did not interfere in the Performance of the Borrower’s Contract with the Broker.
27. 	Defendants violated RESPA by not answering Plaintiff’s RESPA QWR requests in a timely manner.  Defendants did not explain why Defendants had not paid the Broker and Agent (SLT Mortgage) when the loan was partially funded on May 10, 2007.  Defendants did not say when the Broker and Agent (SLT Mortgage) would be paid.  Nor did Defendants comment on the potential Breach of Contract and Interference in the Performance of a Contract issues alleged in the RESPA QWRs.
28. 	Plaintiff Krage wrote further QWRs in June, July and August 2007 asking why the Broker was not paid, requesting that the Broker be paid and requesting compensation for interest Plaintiff Krage had paid on unfunded monies.
29. 	Defendants Boulter and Val-Chris violated RESPA by not timely addressing the issue of when the Broker would be paid and by not timely addressing the question of interest Krage paid on unfunded amounts.
30. 	Plaintiff Krage wrote a further QWR on September 20, 2007, asking why Defendants had refused to answer Plaintiff’s Requests to state when the Broker was paid, and asking why Defendants refused to address Plaintiff’s request for a refund of overpayment because of interest charged for late-funded monies.
31. 	Defendants violated RESPA by not making a timely answer to the issue of when the Broker was paid, or to the issue of overpayment for interest on unfunded monies, as requested in Plaintiff’s September 2007 QWR.
32. 	Plaintiff wrote a further Qualified Written Request (“QWR”) under RESPA on October 19, 2007 asking when Funding Completed.  (Exhibit 19)
33. 	 On October 29, 2007, Defendants Chris Boulter and Val-Chris deliberately and falsely stated in writing that “The full loan amount of $350,000 was wired to the Title Company on or before May 10, 2007.”  (Exhibit 20)
34. 	 On November 20, 2007, Plaintiff Krage wrote a further QWR under RESPA exposing the lie in Defendants’ October 29, 2007 answer and stating that Escrow did not show a wire for the full $350,000 amount of the loan.  (Exhibit 21) 
35. 	 On November 21, 2007 Southland Title, the Title Company for the mortgage transaction, sent Plaintiff Krage a letter concerning the Wire Transfer to SLT Escrow that Southland Title supervised.  The letter stated, “We received a wire in the amount of $330,866.13 on 5/10/07 from Val Chris Investments, Inc, the lender.”  (Exhibit 22)
36. 	On November 26, 2007, Defendants Boulter and Val-Chris wrote an answer to Plaintiff’s QWR RESPA Request and enclosed a copy of a Val-Chris Investments, Inc. “General Account” check for $19,133.87 that was written to a captive Val-Chris Escrow account, not to the neutral SLT Escrow account.  (Exhibit 23)
37. 	  On January 2, 2008, Plaintiff Krage sent Defendants a Notice of Rescission of Contract  (Exhibit 24) including, but not limited to, the following wording: 

“Hereby give notice that said Promissory Note, and subsequently the Trust Deed and all other documents, executed on May 3, 2007, are hereby rescinded for multiple reasons including misrepresentation, fraud, Truth-in-Lending violations, and errors in the notice of the 3 day right of rescission.   Lender Val-Chris appears to also have breeched contract, violated RESPA law, received unjust enrichment, and interfered in the performance of a contract, and  Val-Chris subsequently  and mitigate damages, and therefore, under the provisions of California Civil Code §§1689(b)(1), 1689(b)(5), the Note, and subsequently the Trust Deed and other loan documents, is hereby  rescinded.
This notice shall be deemed effective as of the date of its receipt by Val-Chris or its successor in interest.
The Borrower files this Rescission reluctantly, after giving 11 Qualified Written Request Notices of Breach of Contract, actions to violate TILA, and Interference in the Performance of a Contract, among other things, with Opportunity to Cure, specifically citing the problems of untimely, withheld payments to the broker, among other items   Borrower believes that he has no other recourse with this uncooperative lender.”
38. 	 On January 7, 2008, Plaintiff Krage filed a Rescission of Deed with the L.A. County Recorder under Calif. Civil Code sections 1689(b)(1) and 1689(b)(5). (Exhibit 25)
39. 	On January 11, 2008 (see Exhibit 26), and again on January 18, 2008 (see Exhibit 27), Plaintiff Krage wrote QWRs to Defendants Boulter and Val-Chris. The QWRs:  (1) asked for a copy of the check to the Broker;  (2) asked about previous disciplinary action against Defendants by the California Department of Real Estate;  (3) outlined the multiple misrepresentations Defendants had made;  (4) offered to renegotiate a new loan and;  (5) asked Defendants not to damage Plaintiff further by filing a Notice of Default after the Rescission.
40. 	  On January 21, 2008 Defendant Val-Chris sent Plaintiff Krage copies of checks Val-Chris wrote to SLT Mortgage on June 29, 2007 and July 30, 2007.  (See Exhibit 28)  These checks, written on Val-Chris Investments, Inc.’s “General Account”, proved that:  (1) Val-Chris did not fully fund the Krage loan on May 10, 2007;  (2) Val-Chris did not fully pay the broker’s fees to SLT Mortgage on May 10, 2007 and;  (3) Val-Chris in fact paid broker SLT Mortgage directly out of the proceeds of Plaintiff Krage’s first two mortgage payments.
41. 	On January 23, 2008, Defendants, through their agent, RESS Financial Corp., filed a Notice of Default on the Krage loan with the L.A. County Recorder.  Krage did not receive a copy of the Notice of Default until several days later.
42. 	On January 26, 2008, Plaintiff Krage sent Defendants a QWR, requesting 

“copies of all ledger entries for my separate Escrow Account with Val-Chris, especially showing when the monies were deposited, when the monies were moved to the General Account., any other activity in my separate Escrow Account, and showing Proof that my Escrow Account was separate from all other Escrow Accounts.”
43. 	The January 26, 2008 QWR (Exhibit 29) also explained Defendants’ Misrepresentations and Damages to Plaintiff, and again offered to work out an agreement.
44. 	 On January 28, 2008, Defendants had the Notice of Default mailed to Plaintiff Krage, with Notice that it was an action to collect a debt, and that Krage could dispute the debt under FDCPA.  (Exhibit 30)  FDCPA is the federal Fair Debt Collection Practices Act (15 USC 1692 et seq.).
45. 	On January 30, 2008, Plaintiff sent a QWR to Defendants and a Dispute of the Debt under FDCPA to Defendants and to their agent, RESS Financial.  (Exhibit 31)
46. 	On February 8, 2008, Plaintiff mailed a Notice and Demand to Defendant Val-Chris.  (Exhibit 32)  The Notice and Demand summarized Val-Chris’s duties under the Truth in Lending Act during the rescission process, and also contained an offer of restitution.  Val-Chris ignored the Notice and Demand, ignored the offer of restitution, and has refused to obey the TILA rescission rules even up to the present date.
47. 	On February 19, 2008, Defendant Val-Chris’ attorney Geraci mailed a Letter to Plaintiff Krage alleging that Krage’s QWRs were harassment. Geraci also stated a pre-disposition to deliberately ignore further Krage QWRs.  (See Exhibit 33) The letter was dated February 14, 2008 but postmarked February 19, 2008.  Geraci never offered any explanation for this five-day delay.
48. 	On February 21, 2008, Plaintiff Krage mailed a QWR to Val-Chris’ attorney Geraci, requesting specific information to explain errors in the servicing of the Krage loan.  (See Exhibit 34)
49. 	On February 21, 2008, Defendants Boulter and Val-Chris, through their agent RESS Financial, mailed Plaintiff Krage a second Notice of Default with Notice that it was an action to collect a debt.  This violated many parts of the Fair Debt Collections Practices Act (FDCPA), including sections 15 USC 1692g(b), 15 USC 1692e(8), 15 USC 1692e(2), 15 USC 1692c(c), 15 USC 1692k(c). and possibly violated RESPA, 12 USCA  2605 (e)(3), TILA, and other laws protecting the consumer after Rescission and Dispute of Debt.  (See Exhibit 35)
50. 	 On February 27, 2008, Plaintiff Krage mailed to Attorney Geraci two documents   These documents were:
a)  a letter (See Exhibit 36) advising:

“Geraci is taking a position that may have significant legal consequences. It is one thing for Val-Chris to violate the law perhaps inadvertently.    It is a more serious thing for Geraci to specifically advise Val-Chris to deliberately violate Federal law, and for Val-Chris to knowingly act on such advice.”
and b)  a QWR and second Dispute of Debt (see Exhibit 37), which disputed the debt under the FDCPA, requested validation under the FDCPA, requested specific information to explain other errors in the servicing of the loan, and defaulted Val-Chris for not acknowledging Krage’s January 30, 2008 QWR.

51. 	On March 4, 2008 Plaintiff Krage mailed both to Defendant Val-Chris and to Val-Chris’ RESPA attorney Geraci a FIRST AMENDED NOTICE OF   RESCISSION OF CONTRACT (see Exhibit 38), which included but was not limited to the following wording: 

“In a letter from the Lender’s Lawyer, concerns were expressed:    this amended notice addresses those concerns.

    Specifically, after the Borrower signed loan documents on May 3, 2007, the lender requested 3 additional Disclosures from the Borrower, which Borrower supplied on May 7 and May  8, 2007.   Consequently, consummation by the Lender did not occur until about May 9, 2007, and a Notice of Right to Cancel with a cutoff date of about May 14, 2007 should have been supplied, but was not.   As a result the Right to Cancel under TILA was extended for 3 years.   (Exhibits were supplied in Borrower’s QWR letter of 2/27/08).
    Additionally, charges were included in the Prepaid Finance Charge that were specifically excluded by 12 C.F.R 226.4(c)(7) and 15 USC § 1605(e)(2)..(e.g. Escrow, Sub-Escrow, Doc Prep, Loan Tie In, Notary).    This caused the "Amount Financed" to be understated in the TILA Disclosure by at least $1,375, giving a second right to rescission under TILA, especially after Lender’s filing of a Notice of Default on 1/23/08.
    Other Padded Fees (Secret Profits), etc are Misrepresentation, grounds for Rescission under California Law.
    Also, Lender Val-Chris appears to have breached contract, violated the Real Estate Settlement Practices Act, mishandled trust funds, breached fiduciary duties, committed fraud as a cover-up, received unjust enrichment, interfered in the performance of a contract, and violated the Fair Debt Collection Practices Act.  Val-Chris failed to cure these defects and mitigate damages after many offers of Opportunities to Cure, including a final Notice and Demand sent 2/1/08, which Val-Chris has now defaulted in answering.
Therefore, under the provisions of California Civil Code sections 1689(b)(1), 1689(b)(5), 1689(b)(7), and 12 C.F.R. 226.23 the Note, and subsequently the Trust Deed and other loan documents, is hereby rescinded.”

52. 	 Plaintiff has been in contact with broker Juan Sayles of SLT Mortgage to try to get a loan to cover an expected Payoff Demand Statement of about $305,000.
53. 	On April 15, 2008, Plaintiff’s Broker SLT Mortgage received a Beneficiary’s Demand for Payoff for $393,764.61 from Defendant Val-Chris (Exhibit 39).  The Beneficiary Demand was much higher than the expected demand of about $305,000 that was required if Val-Chris had returned all the money Krage paid in the mortgage transaction.  Full return of Krage’s money was required by TILA, 15 USC 1635(b), after the January 2, 2008 Rescission.  The April 15, 2008 Beneficiary’s Demand obviously violated TILA.
54. 	On April 17, 2008, Plaintiff made a final “Offer of Restitution” (Exhibit 40), requesting the Lender to provide a Payoff Demand Statement that reflects a return of money paid in the transaction, so that Plaintiff could pay the balance with a loan.  Such an overt offer is not required by TILA until the Lender acknowledges the Rescission and offers to return all money paid in the transaction, but Plaintiff offered it anyway in Good Faith, because Plaintiff had been unable to get Val-Chris to return the money paid in the transaction, as required by TILA, 15 USC 1635(b), after Rescission.
55. 	On April 23, 2008, Lender’s lawyer Geraci wrote a letter (Exhibit 41) refusing to acknowledge the Rescission, apparently refusing to offer a Payoff Demand Statement for about $305,000 to return all money paid in the transaction, and apparently making a counter-offer of $309,000 if the Plaintiff agrees to sign an Agreement to “release all claims”.  A counteroffer is a refusal of the original offer.  When a Lender (Defendant Val-Chris) refuses an explicit Offer of Restitution, the Truth in Lending Act, 15 USC 1635(b), provides that the Borrower (Plaintiff Krage) is excused from restitution.
56. 	On May 7, 2008, RESS Financial posted and sent “Notice of Trustee’s Sale Under Deed of Trust” dated April 25, 2008 (Exhibit 42), with the sale date set for May 28, 2008, after failing to Validate the Debt under the FDCPA, and after Val-Chris lost its security interest after Rescission

DISCLAIMER REGARDING EXHIBITS
57. 	The exhibits to this complaint are in separate “Exhibit Packs.”  The exhibits are numbered consecutively, beginning with Exhibit 1, and continuing in sequence through the end of a given Exhibit Pack, and then sequentially on through the next Exhibit Pack.
58. 	The Exhibits are presented to provide the court with many of the significant documents that exist in relationship to the mortgage in question.
59. 	However, Plaintiff disputes the accuracy of some of the exhibits that originated from sources other than the Plaintiff.  Therefore, exhibits from sources other than the Plaintiff are not necessarily presented to prove the truth of the matters contained therein.

III
FIRST CAUSE OF ACTION
RESCISSION FOR LACK OF CONSIDERATION
[Against all Defendants, and each of them, including DOE Defendants]
60. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
61. 	Defendants advertised that they would fund a loan for $350,000 in exchange for the signing of a Promissory Note and Trust Deed, among other papers.   Defendants did not fund all $350,000 as promised on May 10, 2007, but instead moved $19,337.16 into a non-neutral escrow account, so that they could use part of it, then paid the “Loan Origination Fees” (Points in the Pre-Paid Finance Charge) to the broker, SLT Mortgage, from the first 2 payments made by the borrower.   This was short-funding and lack of consideration, intentionally caused by Plaintiffs Boulter and Val-Chris.
62. 	Plaintiff was harmed by Defendants’ actions.
63. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his legal rights.
64. 	Plaintiff Krage demands that the Note and the Deed of Trust at issue in this action be rescinded and/or cancelled.
65. 	Plaintiff demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

IV
SECOND CAUSE OF ACTION
RESCISSION FOR VIOLATION OF
TILA NOTICE OF RIGHT TO CANCEL
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
66. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
67. 	On May 3, 2007, Plaintiff Krage signed a Promissory Note for $350,000 (Exhibit 1), a Deed of Trust (Exhibit 2), and other Documents in exchange for what Krage had been led to believe would be $350,000 that would be placed into an Escrow Account with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendants Boulter and Val-Chris.  The other documents included documents describing Broker fees, Escrow fees and other fees.
68. 	The property in question, 10418 Ives Street, Bellflower, CA is Plaintiff Krage’s Principal Residence.  The loan in question was primarily for non-commercial purposes.

69. 	Defendant Boulter was and is the President of Defendant Val-Chris Investments.  Boulter ordered, directed, managed and supervised the full range and scope of daily activities of Defendant Val-Chris during all times relevant to this cause of action.
70. 	Defendant Val-Chris was the Lender in the mortgage transaction.  Val-Chris, through Val-Chris Escrow, also acted as an escrow agent in the mortgage transaction.

71. 	Defendants, and each of them, had a duty to obey all relevant Federal and California laws at all times during the entire course of the mortgage transaction.  Defendants, and each of them, knew or should have known of this continuing duty to obey all relevant Federal and California laws because Defendants, and each of them, frequently make, process, service, and deal with mortgages and Deeds of Trust.

72. 	Under TILA, Plaintiff Krage had a right to receive a 3-day Notice of Right to Cancel on May 3, 2007, the day he signed the loan documents, and Plaintiff did in fact receive such a notice on that day.

73. 	Val-Chris’ own documents, specifically the “AGREEMENT TO PROCURE A LOAN & LENDER-BORROWER ESCROW INSTRUCTIONS” (Exhibit 8) and Val-Chris’ pre-funding requirements (Exhibit 6) that were captioned as “Exhibit C” attached to the loan procurement agreement, indicated that Val-Chris was not irrevocably committed to the loan contract on May 3, 2007.
74. 	Paragraph 1.3 of the loan procurement agreement stated:

“1.3 LOAN approval is in the discretion of the LENDER. THIS AGREEMENT IS NOT A LOAN COMMITMENT UNTIL LENDER SIGNS THIS AGREEMENT, THEREBY ACKNOWLEDGING ITS COMMITMENT TO MAKE THE LOAN UNDER THE CONDITIONS OF THIS AGREEMENT.”
75. 	The pre-funding requirements (Exhibit 6) were a detailed and specific list of actions and documents that Defendant Val-Chris demanded on May 3, 2007 as absolute conditions for the funding of the loan.

76. 	Several days after May 3, 2007 lender Val-Chris unilaterally imposed a new requirement for 3 additional disclosures from Plaintiff Krage, and further conditioned the funding of the loan upon receiving satisfactory answers to the newly demanded disclosures.
77. 	Val-Chris’s unilateral imposition of new demands for disclosure again showed Val-Chris’ lack of commitment to the May 3, 2007 understandings.

78. 	Borrower Krage supplied the answers to the newly demanded disclosures on May 7 and May 8, 2007.  Therefore consummation by the Lender Val-Chris could not occur any earlier than May 8, 2007, nor was Lender Val-Chris irrevocably bound and committed to funding the loan any earlier than May 8, 2007.   A second 3-day Notice of Right to Cancel with an expiration date of either May 11 or May 14, 2007 should have been issued, but the second, later dated 3-day Notice of Right to Cancel was never given by Val-Chris nor received by Krage..  Instead, the loan was mostly funded on May 10, 2007.  Therefore, the Right to Cancel under TILA was extended for 3 years.

79. 	On January 2, 2008, Plaintiff sent Defendants a “Notice of Rescission of Contract”.  (See Exhibit 24)
80. 	On January 7, 2008, Plaintiff filed a “Rescission of Deed” (see Exhibit 25) with the L.A. County Recorder under California Civil Code §§1689(b)(1) and 1689(b)(5).
81. 	On March 4, 2008 Plaintiff mailed to both Val-Chris and to Val-Chris’  RESPA attorney Geraci a “First Amended Notice Of Rescission Of Contract”.  (Exhibit 38)
82. 	Under the TILA three-year extension of Plaintiff Krage’s Right to Cancel, the Notice of Rescission of Contract, the Rescission of Deed, and the First Amended Notice of Rescission of Contract are all of them timely.

83. 	Plaintiff rescinded for TILA violations and under California Civil Code 1689(b)(7):
84. 	California Civil Code 1689(b)(7) Under the circumstances provided for in Sections 39, 1533, 1566, 1785[FN1], 1789[FN2], 1930 and 2314 of this code, Section 2470 of the Corporations Code[FN3], Sections 331, 338, 359, 447, 1904 and 2030 of the Insurance Code or any other statute providing for rescission.

85. 	Plaintiff Krage was harmed, damaged and denied his legal rights by Defendants’ failure to give him a second, later dated Notice of Right to Cancel as was required by TILA.
86. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his legal rights.
87. 	Plaintiff Krage demands that the Note and the Deed of Trust at issue in this action be rescinded and/or cancelled.  Plaintiff demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

V.
THIRD CAUSE OF ACTION
VIOLATION OF 15 U.S.C. 1635(b) BY
FAILURE TO RETURN MONEY AND ACCEPT RESTITUTION
[Against all Defendants, and each of them, including DOE Defendants]
88. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
89. 	On May 3, 2007, Plaintiff Krage signed a Promissory Note for $350,000 (Exhibit 1), a Deed of Trust (Exhibit 2), and other Documents in exchange for what Krage had been led to believe would be $350,000 that would be placed into an Escrow Account with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendants Boulter and Val-Chris.  The other documents included documents describing Broker fees, Escrow fees and other fees.
90. 	The property in question, 10418 Ives Street, Bellflower, CA is Plaintiff Krage’s Principal Residence.  The loan in question was primarily for non-commercial purposes.

91. 	Defendant Boulter was and is the President of Defendant Val-Chris Investments.  Boulter ordered, directed, managed and supervised the full range and scope of daily activities of Defendant Val-Chris during all times relevant to this cause of action.
92. 	Defendant Val-Chris was the Lender in the mortgage transaction.  Val-Chris, through Val-Chris Escrow, also acted as an escrow agent in the mortgage transaction.
93. 	Defendant Beasley was and is the President of Defendant RESS Financial Corp.  Beasley ordered, directed, managed and supervised the full range and scope of daily activities of RESS Financial during all times relevant to this cause of action.
94. 	Defendant RESS Financial Corp. regularly acts, and in this case acted, as agent for Val-Chris in real property foreclosures.
95. 	Defendants, and each of them, had a duty to obey all relevant Federal and California laws at all times during the entire course of the mortgage transaction.  Defendants, and each of them, knew or should have known of this continuing duty to obey all relevant Federal and California laws:  (1) because Defendants Boulter and Val-Chris, and each of them, frequently make, process, service, and deal with mortgages and Deeds of Trust,  (2) because Defendants Beasley and RESS Financial regularly acts as an agent in real property foreclosures, and  (3) because there was and is regular communication among all Defendants.
96. 	On January 2, 2008, Plaintiff sent Defendants a “Notice of Rescission of Contract”.  (Exhibit 24)  On January 7, 2008, Plaintiff filed a “Rescission of Deed” (Exhibit 25) with the L.A. County Recorder under California Civil Code §§1689(b)(1) and 1689(b)(5).  On March 4, 2008 Plaintiff mailed to both Defendant Val-Chris and to Val-Chris’ RESPA attorney Geraci a “First Amended Notice Of Rescission Of Contract”.  (Exhibit 38).
97. 	Under the TILA three-year extension of Plaintiff Krage’s Right to Cancel, the Notice of Rescission of Contract, the Rescission of Deed, and the First Amended Notice of Rescission of Contract are all of them timely.
98. 	Under the TILA rescission procedure, 15 USC 1635(b), the creditor’s security interest becomes void and the creditor has 20 days to take any necessary action to reflect the voiding of the security interest. Instead, on or about January 4, 2008 Defendant Val-Chris sent Plaintiff Krage a letter flatly rejecting the rescission.
99. 	On January 28, 2008 and February 21, 2008 Val-Chris, acting through its agent, RESS Financial, sent Krage a Notice of Default, which is the first step toward non-judicial foreclosure as a means of enforcing the security interest in Krage’s property, even though the security interest is void.  (See Exhibits 30 and 35).
100. 	On or about April 25, 2008 Defendant Val-Chris, acting through its agent, Defendant RESS Financial, filed a Notice of Sale with the LA County Recorder. (See exhibit 42).  The Notice of Sale is the second step toward non-judicial foreclosure as a means of enforcing the security interest in Krage’s property, even though the security interest is void.
101. 	The Notice of Sale specified May 28, 2008 as the date for the Foreclosure Sale of Plaintiff Krage’s property.  A Foreclosure Sale is the third and most critical step toward non-judicial foreclosure as a means of enforcing the security interest in Krage’s property, even though the security interest is void.

102. 	Under the TILA rescission procedure, 15 USC 1635(b), Defendant Val-Chris had a duty to return to Plaintiff Krage all money that Krage had paid in monthly payments and all money that Krage had paid in costs and fees related to the mortgage.  Krage is also released from any obligation to pay interest, late charges, finance charges, prepayment penalties, or any other charges or fees related to the mortgage.
103. 	Plaintiff Krage calculates that Defendants would have been required to return about $45,000 and that the remaining principal balance of the mortgage would have been about $305,000 if Val-Chris had fully cooperated with the TILA rescission procedure.
104. 	The typical way for Defendant Val-Chris to return the money required in a TILA rescission would have been to issue a Payoff Demand Statement/ Beneficiary Demand Statement that reduced the principal balance of the mortgage to approximately $305,000.
105. 	Plaintiff Krage, acting in the spirit of 15 USC 1635(b), made repeated offers of restitution and/ or restoration to Defendant Val-Chris even though Krage was not required to offer restitution until after Val-Chris had returned the required money and released the security interest in Krage’s property.  Val-Chris repeatedly ignored or rejected Krage’s offers of restitution/ restoration.

106. 	After repeated outright rejections of Plaintiff Krage’s right to rescission, on April 15, 2008 Defendant Val-Chris sent Krage’s broker, SLT Mortgage, a Beneficiary Demand for more than $393,000.  (See Exhibit 39)  Plaintiff Krage rejected such an outrageous and illegal amount, and asked for a reduced Payoff Demand Statement in his letter of April 17, 2008 (See Exhibit 40)
107. 	On April 23, 2008 Val-Chris’ attorney Geraci sent Plaintiff Krage an offer to release the security interest under the following conditions:  (1) Krage would have to pay $309,000 cash by May 14, 2008;  (2) Krage would have to release Val-Chris from any liability for damages in relation to the mortgage. (See Exhibit 41).
108. 	Val-Chris’ April 23, 2008 offer is still higher than the TILA-required restitution amount of about $305,000 and imposes an illegally short deadline and demands a release from lender liability that is not mentioned in the TILA statute. (See Exhibit 41)
109. 	Courts have regularly ordered a recalcitrant lender who refuses to cooperate with the TILA rescission procedure to forfeit all money involved in the loan.

110. 	Plaintiff Krage was harmed, damaged and denied his legal rights by Defendants Boulter and Val-Chris’ failure to cooperate with the TILA rescission procedure as stated in 15 USC 1635(b).
111. 	Plaintiff Krage was particularly harmed, damaged and denied his legal rights by Defendants Boulter and Val-Chris’ unconscionable multi-month delay since January 2, 2008 in implementing the creditor’s return of money required by TILA, by Boulter and Val-Chris’ relentless predatory pressure toward foreclosing on Krage’s property despite the voiding of the security interest by the rescission statute, and by Defendants Beasley and RESS Financial’s assistance of Val-Chris in Val-Chris’ unlawful attempt to foreclose.
112. 	Defendants, and each of them knew, of the January 2, 2008 Notice of Rescission of Contract, knew of the March 4, 2008 First Amended Notice of Rescission of Contract, and knew of the publicly recorded January 7, 2008 Rescission of Deed, but deliberately ignored all these documents.

113. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his legal rights.
114. 	Plaintiff Krage demands that the Note and the Deed of Trust at issue in this action be rescinded and/or cancelled.
115. 	As a further penalty for Defendants Boulter and Val-Chris’ intransigence, Plaintiff demands that he be excused from any obligation of restitution, and that Boulter and Val-Chris shall forfeit the entire amount of the mortgage.
116. 	Plaintiff demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

FOURTH CAUSE OF ACTION
RESCISSION FOR PADDED CHARGES
THAT ARE DECEPTIVE PRACTICES
[Against all Defendants, and each of them, including DOE Defendants]
117. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
118. 	Defendants advertised that they would fund a loan for $350,000 in exchange for the signing of a Promissory Note and Trust Deed, among other papers.   It appears that  Defendants Boulter and Val-Chris padded some charges deceptively and did not fund all $350,000 as promised on May 10, 2007, but instead moved $19,337.16 into a non-neutral escrow account, so that they could use part of it, then paid the “Loan Origination Fees” (Points in the Pre-Paid Finance Charge) to the broker, SLT Mortgage, from the first 2 payments made by the borrower.   The padding of charges gave Defendants secret profits not revealed to the Plaintiff and was intentionally caused by Defendants Boulter and Val-Chris.
119. 	Plaintiff was harmed by Defendants’ actions.
120. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his legal rights.
121. 	Plaintiff Krage demands that the Note and the Deed of Trust at issue in this action be rescinded and/or cancelled.
122. 	Plaintiff demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

FIFTH CAUSE OF ACTION
RESCISSION FOR FAILURE TO GIVE EACH ADULT RESIDENT HAVING EQUITABLE INTEREST A COPY OF THE LOAN DOCUMENTS
[Against all Defendants, and each of them, including DOE Defendants]
123. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
124. 	On May 3, 2007 in the Statement of Information (Exhibit 10) Plaintiff Krage disclosed to Defendants Boulter and Val-Chris that he was married to Patricia Ann Mele-Krage (hereinafter, ”Patricia”) and that he had two adult daughters, Shauna Marie Christina Krage and Jessica Vanessa Crystal Krage (hereinafter, “Vanessa”).  Both Patricia Krage and Vanessa Krage are adults living at 10418 Ives St.  Bellflower, California 90706.
125. 	Patricia Ann Mele-Krage would have equitable interest in the property as my wife when probate is completed, and daughter Vanessa Krage could also under have an equitable interest in the property under some circumstances.
126. 	Defendants Boulter and Val-Chris failed to supply Patricia Krage and Vanessa Krage with any Notice of Right to Cancel.  Therefore Plaintiff has a right to rescind under TILA.
127. 	Plaintiff was harmed by Defendants’ actions.
128. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his legal rights.
129. 	Plaintiff Krage demands that the Note and the Deed of Trust at issue in this action be rescinded and/or cancelled.
130. 	Plaintiff demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

SIXTH CAUSE OF ACTION
CANCELLATION OF INSTRUMENTS
[Against all Defendants and Doe Defendants, and each of them]
131. 	Paragraphs 1 through 56 are repeated here and incorporated by reference.
132. 	The Note (Exhibit 1) and Deed of Trust (Exhibit 2) are voidable for unilateral mistake, misrepresentation of a material fact, fraud in the inducement, concealment, duress (not knowing character of the transaction), undue influence, with unconscionable results: specifically, Misrepresentations in the Truth in Lending Act (hereinafter “TILA”) required Disclosures and for Breach of Contract, Breach of Fiduciary Duty, Negligence, Trust Fund Mishandling, and for other reasons, as specified below.
133. 	Plaintiff was harmed by Defendants’ actions.
134. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his legal rights.
135. 	Plaintiff Krage demands that the Note and the Deed of Trust at issue in this action be rescinded and/or cancelled.
136. 	Plaintiff demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.
SEVENTH CAUSE OF ACTION
QUIET TITLE
[Against Defendants Boulter, Val-Chris, Beasley, RESS Financial, and all persons unknown, claiming any legal or equitable right, title, estate, lien, or interest in the property described in the complaint adverse to plaintiff's title, or any cloud on plaintiff's title thereto, and DOE Defendants, and each of them]

137. 	Paragraphs 1 through 56 above are repeated here and incorporated by reference.
138. 	Plaintiff Krage is the Administrator of the Estate of Verna Gladys Kroemer Krage, which is the sole owner of title of certain real property, namely 10418 Ives Street Bellflower, California 90706, A.P.N. # 6275-014-004, Legal Description:  “Lot 19, Tract 19795, in the City of Bellflower, County of Los Angeles, State of California, as per map recorded in Book 518, Pages 1 and 2 of Maps, in the office of the County Recorder of said County.”
139. 	Plaintiff Krage is Sole Heir of the Estate of Verna Gladys Kroemer Krage.

140. 	Defendant Boulter was and is the President of Defendant Val-Chris.  Boulter ordered, directed, managed and supervised the full range and scope of daily activities of Defendant Val-Chris during all times relevant to this cause of action.
141. 	Defendant Val-Chris was the Lender in the mortgage in question relating to the real property in question in this action.  Val-Chris, through Val-Chris Escrow, also acted as an escrow agent in the mortgage transaction.
142. 	Defendant Beasley was and is the President of Defendant RESS Financial.  Beasley ordered, directed, managed and supervised the full range and scope of daily activities of Defendant RESS Financial during all times relevant to this cause of action.
143. 	Defendant RESS Financial is a corporation that regularly acts, and in this case acted, as Defendant Val Chris’ agent in foreclosures of real property.

144. 	The defendants herein named as ``all persons unknown, claiming any legal or equitable right, title, estate, lien, or interest in the property described in the complaint adverse to plaintiff's title, or any cloud on plaintiff's title thereto'' (hereinafter sometimes referred to as ``the unknown defendants'') are unknown to Plaintiff.
145. 	The “unknown defendants” also include but are not limited to:  (1) any holder(s) in due course of the Note and the Trust Deed in question;  (2) any agent(s), assignee(s) or successor(s) of any holder(s) in due course of the Note and the Trust Deed in question;  (3) any purported bidder(s), including the purported winning bidder(s) at any purported Foreclosure Sale of the real property in question.  A Foreclosure Sale is currently scheduled for May 28, 2008.

146. 	Defendants, and each of them, had a duty to obey all relevant Federal and California laws at all times during the entire course of the mortgage transaction and during any purported Foreclosure.  Defendants, and each of them, knew or should have known of this continuing duty to obey all relevant Federal and California laws because Defendants, and each of them, frequently make, process, service, and deal with mortgages, Deeds of Trust and Foreclosures.

147. 	Defendants Boulter, Val-Chris, Beasley, RESS and the “unknown defendants” and DOE Defendants, and each of them, claim some right, title, estate, lien, or interest in the hereinafter-described property adverse to Plaintiff Krage's title; and their claims, and each of them, constitute a cloud on Plaintiff's title to that property.

148. 	Plaintiff Krage is ignorant of the true names, capacities and relationships of all defendants sued herein, including Defendants Boulter, Val-Chris, Beasley, RESS and the “unknown defendants” and DOE Defendants (DOES 1 through 5), and therefore sues these defendants by such fictitious names.  Plaintiff will amend this complaint to allege their true names, capacities and relationships when these become known.  Plaintiff alleges upon information and belief that each of these fictitiously named defendants claim some right, title, estate, lien, or interest in the hereinafter-described property adverse to Plaintiff's title and their claims, and each of them, constitute a cloud on Plaintiff’s title to that property.
149. 	Some of the unknown defendants, including but not limited to those additionally designated as DOES 1 through 5, claim interests in the property adverse to Plaintiff's as assignees and successors of defendant Val-Chris Investments.

150. 	The basis of Plaintiff Krage's title is a Grant Deed from Heinrich Heinze granting the above-described property in fee simple to “Arthur E. Krage and Verna K. Krage, husband and wife as joint tenants” (Plaintiff Krage’s parents) dated May 6, 1966, and recorded on June 22, 1966 in Los Angeles County as number 1639, Book D3343, Page 634. (Exhibit 43)
151. 	After Arthur Krage died on or about July 1, 1987 title passed to Verna Gladys Kroemer Krage (Plaintiff Krage’s mother).
152. 	After Verna Krage died on or about December 2, 1993 Plaintiff James Krage became Administrator of Verna Krage’s estate.

153. 	On May 3, 2007 Plaintiff Krage signed a Note (Exhibit 1) and a Trust Deed (Exhibit 2) in exchange for what Krage had been led to believe would be $350,000 that would be placed into an Escrow Account with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendants Boulter and Val-Chris.
154. 	The Note was rescinded on January 2, 2008 and the Deed of Trust was rescinded on January 7, 2008 due to Defendant Val-Chris’ violations of TILA, the Truth-in-Lending Act, and violations of Calif. Civil Code section 1689.
155. 	Plaintiff Krage claims that because of the Rescissions of the Note and the Trust Deed that title returned to the Verna Krage estate, and remains there to the present.

156. 	Plaintiff is informed and believes and on such information and belief alleges that Defendants claim an interest adverse to plaintiff in the above-described property as the holder of a Trust Deed (Exhibit 2) which was Rescinded on January 2, 2008.  The Trust Deed was recorded on or about May 10, 2007 at or about Recorder’s Instrument No. 20071147614.

157. 	Plaintiff is seeking to quiet title against the claims of defendants as follows: a Trust Deed from James-Arthur : Krage granting the above-described property to Val-Chris Investments, dated May 3, 2007, and recorded in the Official Records of the County of Los Angeles, on or about May 10, 2007 at or about Recorder’s Instrument No. 20071147614.  The claims of all defendants, including the “unknown defendants” and DOE defendants are without any right whatever and such defendants have no right, title, estate, lien, or interest whatever in the above-described property or any part thereof after service of the Notice of Rescission of Contract on January 2, 2008.
158. 	Plaintiff seeks to quiet title as of February 10, 2008.
159. 	Plaintiff Krage was harmed, damaged and denied his legal rights by Defendants’ actions, including but not limited to: (1) failure to immediately acknowledge the Rescission of the Note and Rescission of the Trust Deed;  (2) failure to publicly record the removal or voiding of defendants’ security interest in the property;  (3) failure to immediately return all money Plaintiff paid in the rescinded mortgage transaction as required by TILA;  (4) recording a Notice of Default;  (5) recording a Notice of Sale;  (6) advertising a Foreclosure Sale;  (7) taking any action whatsoever to conduct, attempt to conduct, participate in or bid at a Foreclosure Sale; (8) taking any other action related to the acts described in this cause of action.
160. 	Defendants, and each of them, including the “unknown defendants”, and including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged or denied his legal rights.
161. 	Plaintiff Krage demands that the Note and the Deed of Trust at issue in this action be rescinded and/or cancelled.  Plaintiff demands that title to the property in question shall be quieted against the claims of all defendants, and each of them.  Plaintiff demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

EIGHTH CAUSE OF ACTION
INJUNCTION
162. 	[Against Defendants Boulter, Val-Chris, Beasley, RESS Financial, “the unknown defendants”, and DOE Defendants, and each of them]
163. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
164. 	Plaintiff is, and at all times mentioned in this complaint was, Administrator of the Estate of Verna Gladys Kroemer Krage, sole heir of the estate, the borrower, the real party in interest, and an individual.
165. 	Plaintiff is the only son of Arthur Ewald Krage and Verna Gladys Kroemen Krage, both now deceased and both of which purchased the property from Gottfried Heinze and Anelia Heinze and received a Grant Deed from Gottfried Heinze and Anelia Heinze on May 6, 1966  (Exhibit 43).

166. 	On May 3, 2007, Plaintiff Krage signed a Promissory Note for $350,000 (Exhibit 1), a Deed of Trust (Exhibit 2), and other Documents in exchange for what Krage had been led to believe would be $350,000 that would be placed into an Escrow Account with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendants Boulter and Val-Chris.  The other documents included documents describing Broker fees, Escrow fees and other fees.
167. 	The property in question, 10418 Ives Street, Bellflower, CA is Plaintiff Krage’s Principal Residence/Domicile.  The loan in question was primarily for non-commercial purposes.

168. 	On January 2, 2008, Plaintiff Krage sent Defendants a “Notice of Rescission of Contract”. (Exhibit 24)  On January 7, 2008, Plaintiff filed a “Rescission of Deed” (Exhibit 25) with the L.A. County Recorder.  On March 4, 2008 Plaintiff mailed to both Val-Chris and to Val-Chris’ RESPA attorney Geraci a “First Amended Notice Of Rescission Of Contract”. (Exhibit 38)

169. 	Defendant Boulter was and is the President of Defendant Val-Chris Investments.  Boulter ordered, directed, managed and supervised the full range and scope of daily activities of Defendant Val-Chris during all times relevant to this cause of action.
170. 	Defendant Val-Chris was the Lender in the mortgage transaction.  Val-Chris, through Val-Chris Escrow, also acted as an escrow agent in the mortgage transaction.
171. 	Defendant Beasley was and is the President of Defendant RESS Financial.  Beasley ordered, directed, managed and supervised the full range and scope of daily activities of Defendant RESS Financial during all times relevant to this cause of action.
172. 	Defendant RESS Financial regularly acts, and in this case acted, as agent of Defendant Val-Chris in real property foreclosures.

173. 	Defendants Boulter and Val-Chris are, and at all times mentioned in this complaint were Creditors and Lenders that advertised that they would lend Plaintiff Krage $350,000 in exchange for a Promissory Note, Trust Deed and other papers.  But the consideration for the loan failed in material part.  Defendants failed to pay out escrow monies timely, violated TILA, RESPA, FDCPA, California Financial Code, Civil Code, Business and Professions Code, lost their Security Interest in the property after Rescission by Plaintiff, further refused to acknowledge the Rescission and Return all Monies Paid in the Transaction as required by TILA after Rescission, and finally refused Plaintiff’s explicit Offer of Restitution (Exhibit 40) in a lawyer’s letter on April 22, 2008 (Exhibit 41).

174. 	Defendants Beasley and RESS Financial are, and at all times mentioned in this complaint were agents of Defendants Boulter and Val-Chris that violated the federal Fair Debt Collection Practices Act by sending multiple copies of 2 additional letters after their initial Debt Collection Letter without validating the Debt, after Plaintiff timely Disputed the Debt and Requested Validation 

175. 	All Defendants, including Defendants Doe I through Doe 5, inclusive, and including “the unknown defendants” (including any purported winning bidder(s) at any purported Foreclosure Sale of Plaintiff’s property) are sued in this complaint under fictitious names. Their true names and capacities are unknown to plaintiff. When their true names and capacities are ascertained, plaintiff will amend this complaint by inserting their true names and capacities herein. Plaintiff is informed and believes and thereon alleges, that each of the fictitiously named defendants is responsible in some manner for the occurrences alleged in this complaint, and that plaintiff's damages as alleged in this complaint were proximately caused by those defendants.

176. 	Beginning on or about January 3, 2008 and continuing to the present time, defendants, and each of them, wrongfully and unlawfully (after lacking consideration in the original transaction, failing to pay out escrow monies timely and violating multiple other laws), violated TILA, RESPA, and FDCPA  further by refusing to acknowledge the Rescission and Return all Monies Paid in the Transaction as required by TILA after Rescission, refused Plaintiff’s explicit Offer of Restitution (Exhibit 40) in a lawyer’s letter on April 22 (Exhibit 41), and pursued Non-Judicial Foreclosure without a security interest and without Validating the Debt after Plaintiff disputed the Debt and requested Validation under the federal Fair Debt Collectiojns Practices Act.

177. 	On or about February 8, 2008, in a Notice and Demand letter (Exhibit 32) and a number of times since then, plaintiff has demanded that defendants stop their wrongful conduct described above. Defendants, and each of them, have refused and still refuse to refrain from their conduct and intend to sell the property at a Foreclosure Sale on May 28, 2008, despite the fact that Defendants no longer have any security interest in the property.

178. 	Defendants' wrongful conduct, unless and until enjoined and restrained by order of this court, will cause great and irreparable injury to plaintiff as his property will be sold at a Foreclosure Sale auction and the winning bidder(s) at the Foreclosure Sale will then attempt to evict Plaintiff Krage and Plaintiff’s family.  Plaintiff and his family have lived at the property in question since 1994. 
179. 	Plaintiff has no adequate remedy at law for the injuries that are threatened by Defendants as it will be extremely difficult for Plaintiff and his family to relocate themselves and their possessions on short notice to await the final judgment in this action before being allowed to return to their rightful home of many years.   Plaintiff cannot determine the amount of damage that he and his family would suffer under those circumstances.  Plaintiff would also have to simultaneously defend against an unlawful detainer action at the same time that he is prosecuting this lawsuit to conclusively determine title to and possession of the disputed real property.
180. 	As a direct and proximate result of Defendant’s wrongful conduct Plaintiff Krage has already been damaged although the exact amount of those damages is unknown.  Plaintiff will be further damaged so long as defendants' conduct and threatened conduct continues. The full amount of this damage is not now known to plaintiff, and plaintiff will amend this complaint to state this amount when it becomes known or on proof of the damages.

181. 	Plaintiff asks that a Temporary Restraining Order (TRO) and a Preliminary Injunction shall be issued against the Defendants, and each of them, and against their officers, directors, employees, agents and anyone acting on Defendants’ behalf, enjoining all such persons from taking any action to advertise, hold, conduct or participate in any Foreclosure Sale of Plaintiff’s property until further order of this court.
182. 	Plaintiff also asks compensatory, statutory, general and punitive damages, and such other relief as is just.

NINTH CAUSE OF ACTION
DECLARATORY RELIEF
[Against Defendants Boulter, Val-Chris, DOE Defendants, and each of them]
183. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
184. 	A controversy exists regarding a Promissory Note, a Deed of Trust, and the related piece of real property.
185. 	On May 3, 2007, Plaintiff Krage signed a Promissory Note for $350,000 (Exhibit 1), a Deed of Trust (Exhibit 2), and other Documents in exchange for what Krage had been led to believe would be $350,000 that would be placed into an Escrow Account with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendants Boulter and Val-Chris.  The other documents included documents describing Broker fees, Escrow fees and other fees.
186. 	The property in question, 10418 Ives Street, Bellflower, CA is Plaintiff Krage’s Principal Residence.  The loan in question was primarily for non-commercial purposes.
187. 	On January 2, 2008, Plaintiff Krage sent Defendants a “Notice of Rescission of Contract”. (Exhibit 24)  On January 7, 2008, Plaintiff filed a “Rescission of Deed” (Exhibit 25) with the L.A. County Recorder.  On March 4, 2008 Plaintiff mailed to both Val-Chris and to Val-Chris’ RESPA attorney Geraci a “First Amended Notice Of Rescission Of Contract”. (Exhibit 38)

188. 	Defendant Boulter was and is the President of Defendant Val-Chris Investments.  Boulter ordered, directed, managed and supervised the full range and scope of daily activities of Defendant Val-Chris during all times relevant to this cause of action.
189. 	Defendant Val-Chris was the Lender in the mortgage transaction.  Val-Chris, through Val-Chris Escrow, also acted as an escrow agent in the mortgage transaction.

190. 	Plaintiff Krage alleges that the Promissory Note and Deed of Trust have been rescinded, and that title to the real property in question reverted to the Estate of Verna Krage
191. 	Upon information and belief, Defendants Boulter and Val-Chris claim that the Promissory Note and the Deed of Trust are valid, and Defendants intend to conduct a Foreclosure Sale of Krage’s property on May 28, 2008.

192. 	Defendants have acted negligently, recklessly, oppressively, and with deliberate disregard to the probability of denial of Plaintiff’s rights .
193. 	Plaintiff has been harmed, damaged and denied his rights by Defendants’ conduct.
194. 	Plaintiff Krage asks that the court shall declare the rights of the parties regarding the Promissory Note, the Deed of Trust and the real property in question.
195. 	Plaintiff Krage asks compensatory, statutory, general and punitive damages.

TENTH CAUSE OF ACTION
FRAUD
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
196. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
197. 	Plaintiff is, and at all times mentioned in this complaint was, Administrator of the Estate of Verna Gladys Kroemer Krage, sole heir of the estate, the borrower, the real party in interest, and an individual.
198. 	Defendant Boulter was and is the President of Defendant Val-Chris Investments.   Boulter ordered, directed, managed and supervised the full range and scope of daily activities of Defendant Val-Chris during all times relevant to this cause of action.
199. 	Defendant Val-Chris was the Lender in the mortgage transaction.  Val-Chris, through Val-Chris Escrow, also acted as an escrow agent in the mortgage transaction.
200. 	On May 3, 2007, Plaintiff Krage signed a Promissory Note for $350,000 (Exhibit 1), a Deed of Trust (Exhibit 2), and other Documents in exchange for what Krage had been led to believe would be $350,000 that would be placed into an Escrow Account with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendants Boulter and Val-Chris.  The other documents included documents describing Broker fees, Escrow fees and other fees.
201. 	The property in question, 10418 Ives Street, Bellflower, CA is Plaintiff Krage’s Principal Residence.  The loan in question was primarily for non-commercial purposes.
202. 	On May 10, 2007 the loan in question was mostly funded.  However, Defendants Boulter and Val-Chris wrongfully and deliberately withheld more than $19,000 from the escrow account at SLT Escrow and diverted that money to a captive, non-neutral account at Val-Chris Escrow.  (See Exhibits 22 and 23)
203. 	Defendants Boulter and Val-Chris wrongfully and deliberately refused to pay most of the Broker’s Fees to SLT Mortgage and withheld more than $7,100 from SLT Mortgage for a period of almost three months.  Boulter and Val-Chris paid broker SLT Mortgage directly out of Plaintiff Krage’s first two mortgage payments, instead of paying SLT out of the initial proceeds of the loan as required by the loan documents.

204. 	Defendants falsely represented that they would fully fund the loan in question and concealed Defendants’ intention to “short-fund” the loan, to divert money to a non-neutral escrow account and to arbitrarily delay paying broker fees to SLT Mortgage.  Defendants specifically lied and claimed in their Oct 29, 2007 letter (Exhibit 20) that the loan had been fully funded.
205. 	It wasn’t until January 21, 2008 (Exhibit 28) that Defendants finally admitted that they had withheld the broker fees from SLT Mortgage and that the broker fees had been paid out of Krage’s first two mortgage payments.
206. 	Defendants clearly knew that they had “short-funded” the loan and that they had refused to promptly pay the broker out of the loan proceeds.
207. 	On May 3, 2007 Defendants caused Plaintiff Krage to be presented with loan documents that falsely indicated that the broker, SLT Mortgage, would be paid out of the proceeds of the loan.  Defendants intended to induce, and did induce Krage to rely on those false loan documents.  Krage relied on the loan documents, signed the loan documents because he believed the written promises in those documents, and did so to his detriment.  Plaintiff Krage was damaged by Defendants’ “short-funding” of the loan, by Defendants’ diversion of funds to a captive, non-neutral escrow account, and by Defendants’ refusal to pay broker SLT Mortgage promptly and fully upon May 10, 2007.

208. 	Defendants acted negligently, recklessly, oppressively, fraudulently, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

ELEVENTH CAUSE OF ACTION
CONSTRUCTIVE FRAUD
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
209. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
210. 	Plaintiff is, and at all times mentioned in this complaint was, Administrator of the Estate of Verna Gladys Kroemer Krage, sole heir of the estate, the borrower, the real party in interest, and an individual.
211. 	Defendant Boulter was and is the President of Defendant Val-Chris Investments.  Boulter ordered, directed, managed and supervised the full range and scope of daily activities of Defendant Val-Chris during all times relevant to this cause of action.
212. 	Defendant Val-Chris was the Lender in the mortgage transaction.  Val-Chris, through Val-Chris Escrow, also acted as an escrow agent in the mortgage transaction.
213. 	On May 3, 2007, Plaintiff Krage signed a Promissory Note for $350,000 (Exhibit 1), a Deed of Trust (Exhibit 2), and other Documents in exchange for what Krage had been led to believe would be $350,000 that would be placed into an Escrow Account with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendants Boulter and Val-Chris.  The other documents included documents describing Broker fees, Escrow fees and other fees.
214. 	The property in question, 10418 Ives Street, Bellflower, CA is Plaintiff Krage’s Principal Residence.  The loan in question was primarily for non-commercial purposes.
215. 	On May 10, 2007 the loan in question was mostly funded.  However, Defendants Boulter and Val-Chris wrongfully and deliberately withheld more than $19,000 from the escrow account at SLT Escrow and diverted that money to a captive, non-neutral account at Val-Chris Escrow.  (See Exhibits 22 and 23)
216. 	Defendants Boulter and Val-Chris wrongfully and deliberately refused to pay most of the Broker’s Fees to SLT Mortgage and withheld more than $7,100 from SLT Mortgage for a period of almost three months.  Boulter and Val-Chris paid broker SLT Mortgage directly out of Plaintiff Krage’s first two mortgage payments, instead of paying SLT Mortgage out of the initial proceeds of the loan as required by the loan documents.
217. 	Defendants falsely represented that they would fully fund the loan in question and concealed Defendants’ intention to “short-fund” the loan, to divert money to a non-neutral escrow account and to arbitrarily delay paying broker fees to SLT Mortgage.  Defendants specifically lied and claimed in their Oct 29, 2007 letter (Exhibit 20) that the loan had been fully funded.
218. 	It wasn’t until January 21, 2008 (Exhibit 28) that Defendants admitted that they had withheld the broker fees from SLT Mortgage and that the broker fees had been paid out of Krage’s first two mortgage payments.
219. 	Defendants clearly knew that they had “short-funded” the loan and that they had refused to promptly pay the broker out of the loan proceeds.
220. 	On May 3, 2007 Defendants caused Plaintiff Krage to be presented with loan documents that falsely indicated that the broker, SLT Mortgage, would be paid out of the proceeds of the loan.  Defendants intended to induce, and did induce Krage to rely on those false loan documents.  Krage relied on the loan documents, signed the loan documents because he believed the written promises in those documents, and did so to his detriment.  Plaintiff Krage was damaged by Defendants’ “short-funding” of the loan, by Defendants’ diversion of funds to a captive, non-neutral escrow account, and by Defendants’ refusal to pay broker SLT Mortgage promptly and fully upon May 10, 2007.
221. 	Defendants committed constructive fraud against Plaintiff. Defendants acted negligently, recklessly, oppressively, fraudulently, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

TWELFTH CAUSE OF ACTION
BREACH OF FIDUCIARY DUTY
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
222. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
223. 	Defendants Boulter and Val-Chris were fiduciaries to Plaintiff Krage   In addition to acting as Lender, Val-Chris also acted as Escrow and in other capacities.  Val-Chris wrongfully diverted $19,227.87 from an SLT Escrow account into an Val-Chris Escrow Account, and delayed disbursal of $7,113 for a Loan Origination Fee to SLT Mortgage for almost 3 months, until end of July, 2007, and paid the balance in 2 checks from Val-Chris General Account.  The actual money paid to SLT came from the first two monthly payments made by the borrower, Krage, not from the loan proceeds as required by the loan documents.
224. 	Defendants breached their fiduciary duties towards Plaintiff Krage. Krage was damaged by Defendants breach of their fiduciary duties. 
225. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

THIRTEENTH CAUSE OF ACTION
BREACH OF CONTRACT
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
226. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
227. 	A contract existed that required that an $8,750 Loan Origination Fee be paid to SLT Mortgage out of the proceeds of the Val-Chris loan to Plaintiff Krage.   It was included in the “Prepaid Finance Charge”.  Val-Chris wrongfully diverted $19,227.87 into a Val-Chris Escrow Account, then delayed disbursal of $7,113 for a Loan Origination Fee to SLT Mortgage for almost 3 months, until end of July, 2007, and paid the balance in 2 checks from Val-Chris General Account, not the Escrow Account.
228. 	The actual money paid to SLT came from the first two monthly payments made by the borrower, Krage, not from the loan proceeds as required by the loan documents.
229. 	Defendants breached their contract with Plaintiff Krage.  Krage was damaged by Defendants breach of the contract. 
230. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

FOURTEENTH CAUSE OF ACTION
INTERFERENCE WITH CONTRACT
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
231. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
232. 	Plaintiff contracted to pay an $8,750 Loan Origination Fee to SLT Mortgage.   It was included in the “Prepaid Finance Charge”.  Val-Chris deposited $19,227.87 into a Val-Chris Escrow Account, but delayed disbursal of $7,113 for a Loan Origination Fee to SLT Mortgage for almost 3 months, until end of July, 2007, and paid the balance in 2 checks from Val-Chris General Account, not the Escrow Account.   This interfered in the Performance of Plaintiff’s Contract to pay the Loan Origination Fee to SLT Mortgage at Funding.
233. 	The instrument is voidable for interference in the performance of a contract, by Defendants’ actions to withhold payment into the agreed-upon Escrow Account, which resulted in the withholding of payments to the broker, agent and escrow, which were claimed to be prepayment charges to be paid by Plaintiff via the agreed upon Escrow Account.
234. 	Defendants interfered with Krage’s contract.  Krage was thereby damaged.
235. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

FIFTEENTH CAUSE OF ACTION
UNJUST ENRICHMENT
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
236. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
237. 	Damages are sought against Defendants for unjust enrichment because Defendants withheld $19,133.87 from the neutral Escrow Account. (In exchange for the Borrower’s Promissory Note and Trust Deed, only $330,866.13 of the agreed-upon $350,000 was wired into the SLT Escrow account # AKA 1146-SLT2), which Plaintiff believes was possibly an attempt to get unjust interest on the monies at Plaintiff’s expense.  Defendants also padded the amounts for various charges and fees related to the loan in order to gain Secret Profits.
238. 	Plaintiff Krage was damaged by the actions of Defendants.
239. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.
SIXTEENTH CAUSE OF ACTION
TRUST FUND MISHANDLING / COMINGLING
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
240. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
241. 	In addition to acting as Lender, Val-Chris also acted as Escrow.   Val-Chris deposited $19,227.87 into an Val-Chris Escrow Account, but delayed disbursal of $7,113 for a Loan Origination Fee to SLT Mortgage for almost 3 months, until end of July, 2007, and paid the balance in 2 checks from Val-Chris General Account, not the Escrow Account.
242. 	Defendants violated Business & Professions Code sections 17200-17500 and 10177d and 10145.
243. 	Plaintiff Krage was damaged by the actions of Defendants.
244. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

SEVENTEENTH CAUSE OF ACTION
OTHER TILA VIOLATIONS
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
245. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
246. 	The instrument is rescindable against Defendants, for a violation of the Truth in Lending Act (Hereinafter, “TILA”) by inaccurate disclosure, partially prima facie, partially by wrong calculations, and partially by incomplete consideration into the agreed-upon Escrow Account, rendering the TILA Disclosure more inaccurate by Defendants’ own actions.  TILA is 15 USC 1635.
247. 	Specifically, after the Borrower signed loan documents on May 3, 2007, the lender requested 3 additional Disclosures from the Borrower, which Borrower supplied on May 7 and May 8, 2007.  Consequently, consummation by the Lender did not occur until about May 9, 2007, and a Notice of Right to Cancel with a cutoff date of about May 14, 2007 should have been supplied, but was not.   As a result the Right to Cancel under TILA was extended for 3 years.   (Exhibits were supplied in Borrower’s QWR letter of 2/27/08).
248. 	Additionally, charges were included in the Prepaid Finance Charge that were specifically excluded by 12 C.F.R 226.4(c)(7) and 15 USC § 1605(e)(2)..(e.g. Escrow, Sub-Escrow, Doc Prep, Loan Tie In, Notary).  This caused the "Amount Financed" to be understated in the TILA Disclosure by at least $1,375, giving a second right to rescission under TILA, especially after Lender’s filing of a Notice of Default on 1/23/08.
249. 	Plaintiff Krage was damaged by the actions of Defendants.
250. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

EIGHTEENTH CAUSE OF ACTION
RESPA VIOLATIONS
[Against Defendants Boulter, Val-Chris and DOE Defendants, and each of them]
251. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
252. 	Damages are sought against Defendants, for 21 violations of 12 USC 2601 et seq RESPA (Real Estate Settlement Procedures Act), and 24 CFR 3500 et seq Regulation X, for failure to specifically answer with all relevant details 21 Qualified Written RESPA Requests (hereinafter, “QWR”s) within the legally required time. The QWRs are as follows:

Date		Certified Mail#	Received    Unanswered Subject
5/16/07						        Breach of Contract: Pay Broker! Uphold Contract!
5/17/07						        Breach of Contract Complete Funding!-Pay Broker!
6/8/07      7007-0220-0001-9730-2929   	6/11/07  	        Breach of Contract Complete Funding!-Pay Broker!
6/14/07	  7007-0220-0001-9730-2998	6/15/07	        Breach of Contract Complete Funding!-Pay Broker!
6/16/07	  1 page Notarized, not Certified		        Breach of Contract Complete Funding!-Pay Broker!
6/16/07	  7007-0220-0001-9730-2967	6/18/07	        Breach of Contract Complete Funding!-Pay Broker!
7/16/07    7007-0220-0001-9730-2912	7/17/07	        Breach of Contract Complete Funding!-Pay Broker!
8/16/07  	  7007-0220-0001-9730-3124	8/20/07	        Breach of Contract Complete Funding!-Pay Broker!
9/20/07	  7007-0220-0001-9730-3032	9/21/07	        When did Funding Complete? Why no real answers
10/19/07	   7007 0220 0001 9730 3100	10/22/07	        When did Funding Complete? Why no real answers
11/20/07	   7007 0220 0001 9730 3117	11/21/07	        When did Funding Complete? Why no real answers
1/11/08	   7007 1490 0001 8524 5546	1/14/08	  Substantiate Misrepresentations acknowledge Rescission
1/18/08	   7007 0220 0001 9730 3186	1/28/08	  Substantiate Misrepresentations acknowledge Rescission
1/26/08	   7007 0220 0001 9730 3193	1/28/08	  Substantiate Misrepresentations acknowledge Rescission
1/30/08	   7007 0220 0001 9730 3230	2/1/08	  Substantiate Misrepresentations acknowledge Rescission
2/21/08	   7007 1490 0001 8524 5560	2/25/08	  Substantiate Misrepresentations acknowledge Rescission
2/27/08	   7007 1490 0001 8524 5577	2/28/08	  Substantiate Misrepresentations acknowledge Rescission
3/14/08	   7007 1490 0001 8524 5591	3/17/08	  Substantiate Misrepresentations acknowledge Rescission
3/26/08	   7007 0220 0001 9730 2899	3/27/08	  Substantiate Misrepresentations acknowledge Rescission
4/16/08	   7007 0220 0001 9730 2974	4/17/08	  Substantiate Misrepresentations acknowledge Rescission
4/17/08	   7007 1490 0001 8554 4953	4/21/08	  Substantiate Misrepresentations acknowledge Rescission

253. 	This is a "Federally related mortgage loan or mortgage loan", Val-Chris is a creditor", "servicer", and "settlement service" and the transaction was a "refinancing" as defined in Regulation X at 24 CFR 3500.2.
254. 	No Special Information booklet was provided the borrower, as required by RESPA in 24 CFR 3500.6.
255. 	Questions arose repeatedly concerning the “Disbursement Date”, a “Shortage” or “Deficiency” caused by short-funding by the Creditor, elements defined in 24 CFR 3500.17.
256. 	Repeated intentional Violations of 24 CFR 3500.21(e) occurred when the servicer refused to do his duty to timely acknowledge receipt of QWRs, make corrections to the account, and answer QWRs submitted by the Borrower/Plaintiff.
257. 	Defendants lied in their October 29, 2007 answer to my QWRs by stating “The full loan amount of $350,000 was wired to the title company on or before May 10, 2007.”
258. 	Defendants’ letter of November 26, 2007 first admitted that $19,133.87 was not wired to title for SLT escrow, and supplied a copy of a check #12436 to Val-Chris Escrow.
259. 	Defendants’ correspondence of January 21, 2008 first admitted that 2 checks from the General Account for $3,556.50 each were paid to SLT Mortgage on 6/29/08 and 7/30/08 (#12555 and #12629), which proved that Defendants did not pay the prepaid points to the broker at funding, but waited until Plaintiff’s first two monthly payments were made, so that those monthly payments could be used to pay SLT.
260. 	Plaintiff submitted the 21 QWRs under RESPA to receive “timely information on the nature and costs of the settlement process”, and Defendants Boulter and Val-Chris, and their agent Anthony Geraci, Esquire, acted intentionally to prevent “timely information on the nature and costs of the settlement process” from being received by Plaintiff Borrower, and in fact lied to cover up elements in the settlement process that violated state and federal laws.
261. 	Plaintiff Krage was damaged by the actions of Defendants.
262. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

NINETEENTH CAUSE OF ACTION
VIOLATION OF FAIR DEBT COLLECTION PRACTICES ACT
15 U.S.C. 1692 et seq
[Against Defendants Boulter, Val-Chris, Beasley,
RESS Financial and DOE Defendants, and each of them]
263. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
264. 	On February 21, 2008, Defendants caused a second Notice of Default with Notice that it was an action to collect a debt to be mailed to Plaintiff, in violation of the Fair Debt Collections Practices Act, after Plaintiff had disputed the debt, requested validation, and asked that no further correspondence be sent prior to validation.
265. 	A Notice of Sale Date was mailed in May 2008, in violation of the Fair Debt Collections Practices Act, after Plaintiff had disputed the debt, requested validation, and asked that no further correspondence be sent prior to validation.
266. 	Defendants violated 15 USC 1692g(b), 15 USC 1692e(8), 15 USC 1692e(2), 15 USC 1692c(c), 15 USC 1692k(c).
267. 	Plaintiff Krage was damaged by the actions of Defendants.
268. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

TWENTIETH CAUSE OF ACTION
VIOLATION OF HOEPA
[Against Defendants Boulter, Val-Chris, DOE Defendants, and each of them]
269. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
270. 	Defendants caused the delivery of a HOEPA disclosure form for signing by the borrower on May 3, 2008, thereby invoking HOEPA.
271. 	Defendants violated HOEPA (federal Home Owners Equity Protection Act) in 12 CFR 226.32 and other sections of Regulation Z 12 CFR 226.01 et seq)  by charging excessively high interest rates, by failing to give Plaintiff Krage all the required HOEPA notices, by not delivering HOEPA disclosures 3 days before loan consummation, by charging excessively high fees, by charging fees specifically forbidden by HOEPA, by imposing a pre-payment penalty forbidden by HOEPA and by other wrongful acts.
272. 	Plaintiff Krage was damaged by the actions of Defendants.
273. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

TWENTY-FIRST CAUSE OF ACTION
VIOLATION OF CALIF. FINANCIAL. CODE SECTION 4973(k)
[Against Defendants Boulter, Val-Chris, DOE Defendants, and each of them]
274. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
275. 	Defendants did not supply a consumer caution notice 3 days before Plaintiff Krage signed the loan documents. This violated CALIFORNIA FINANCE CODE section 4973(k).
276. 	Plaintiff Krage was damaged by the actions of Defendants.
277. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.

TWENTY-SECOND CAUSE OF ACTION
VIOLATION OF CALIFORNIA FINANCIAL CODE SECTION 22317.5
FAILURE TO DISBURSE FUNDS COMMITTED
278. 	[Against Defendants Boulter, Val-Chris, DOE Defendants, and each of them]
279. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
280. 	Defendants failed to disburse all of the prepaid Loan Origination Fee to SLT Mortgage timely, but delayed payment for months.
281. 	Defendants advertised that they would fund a loan for $350,000 in exchange for the signing of a Promissory Note and Trust Deed, among other papers.   Defendants did not fund all $350,000 as promised on May 10, 2007, but instead moved $19,337.16 into a non-neutral escrow account, so that they could use part of it, then paid the “Loan Origination Fees” (Points in the Pre-Paid Finance Charge) to the broker, SLT Mortgage, from the first 2 payments made by the borrower.   This was short-funding and lack of consideration, and failure to disburse funds committed in violation of California Finance Code section 22317.5.
282. 	Plaintiff Krage was damaged by the actions of Defendants.
283. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.
TWENTY-THIRD CAUSE OF ACTION
ACCOUNTING
[Against Defendants Boulter, Val-Chris, DOE Defendants, and each of them]
284. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
285. 	An accounting of all money related to the Krage loan is necessary because of the actions, misrepresentations, concealments and outright lies by the Defendants. Plaintiff asks that the court shall order such an accounting.
286. 	Plaintiff Krage was damaged by the actions of Defendants.
287. 	Defendants acted negligently, recklessly, oppressively, and with deliberate indifference to the probability of denying Plaintiff’s rights.  Plaintiff asks compensatory, statutory, general and punitive damages, and such other relief as is just.
TWENTY-FOURTH CAUSE OF ACTION
NEGLIGENCE
[Against Defendants Boulter, Val-Chris, DOE Defendants, and each of them]
288. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
289. 	On May 3, 2007, Plaintiff Krage signed a Promissory Note for $350,000 (Exhibit 1), a Deed of Trust (Exhibit 2), and other Documents in exchange for $350,000 that he had been led to believe would be placed into an Escrow Acccount with SLT Escrow (SLT Escrow account # AKA 1146-SLT2) by Defendant Val-Chris.  The other documents included documents describing Broker fees, Escrow fees and other fees.
290. 	The property in question, 10418 Ives Street, Bellflower, CA 90706, is Plaintiff Krage’s Principal Residence.  The loan in question was primarily for non-commercial purposes.
291. 	Defendant Boulter was and is the President of Defendant Val-Chris Investments.  Boulter ordered, directed, managed and supervised the full range and scope of daily activities of Defendant Val-Chris during all times relevant to this cause of action.
292. 	Defendant Val-Chris was the Lender in the mortgage transaction.  Val-Chris, through Val-Chris Escrow, also acted as an escrow agent in the mortgage transaction.

293. 	Defendants, and each of them, had a duty to obey all relevant Federal and California laws at all times during the entire course of the mortgage transaction.  Defendants, and each of them, knew or should have known of this continuing duty to obey all relevant Federal and California laws because Defendants, and each of them, frequently make, process, service, and deal with mortgages and Deeds of Trust.

294. 	Defendants violated TILA, the Truth in Lending Act, RESPA, the Real Estate Settlement Practices Act, HOEPA, the Home Owner Equity Protection Act, FDCPA the Fair Debt Collection Practices Act, and other federal laws by various wrongful acts.
295. 	Defendants violated Calif. Finance Code sections 4973(k) and 22317.5 and the Business & Professions Code 17200 and other California laws by various wrongful acts.
296. 	Plaintiff Krage was harmed and damaged by Defendants’ actions.
297. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his rights.
298. 	Plaintiff Krage demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

TWENTY-FIFTH CAUSE OF ACTION
VIOLATION OF DUTY OF GOOD FAITH AND FAIR DEALING
[Against Defendants Boulter, Val-Chris, DOE Defendants, and each of them]
299. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
300. 	Because Defendants were not only the Lender, but also acted as Escrow, Defendants had a duty of Good Faith and Fair Dealing, which they breached by various acts that breached fiduciary duty, breached contract, interfered in the performance of a contract, failed to disburse funds timely from escrow, lied to cover up, misrepresented to cover up.
301. 	Plaintiff Krage was harmed and damaged by Defendants’ actions.
302. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his rights.
303. 	Plaintiff Krage demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

TWENTY-SIXTH CAUSE OF ACTION
FALSE ADVERTISING – BUSINESS & PROFESSIONS CODE 17200
[Against Defendants Boulter, Val-Chris, DOE Defendants, and each of them]
304. 	Paragraphs 1 through 56 above are repeated and incorporated by reference.
305. 	Defendants advertised that they would fund a loan for $350,000 in exchange for the signing of a Promissory Note and Trust Deed, among other papers.   Defendants did not fund all $350,000 as promised on May 10, 2007, but instead moved $19,337.87 into a non-neutral escrow account, so that they could use part of it, then paid the “Loan Origination Fees” (Points) in the Pre-Paid Finance Charge to the broker, SLT Mortgage, from the first 2 payments made by the borrower.   From May 10, 2007 to July, 30, 2007, this delay in the disbursement date caused a shortage for almost 3 months by lack of consideration.
306. 	Plaintiff Krage was harmed and damaged by Defendants’ actions.
307. 	Defendants, and each of them, including DOE Defendants, acted negligently, recklessly, maliciously, oppressively, and with deliberate indifference to the possibility that Plaintiff Krage might be harmed, damaged, or denied his rights.
308. 	Plaintiff Krage demands compensatory damages, statutory damages, general damages, punitive damages, and such other relief as is just.

IV.
PRAYER FOR RELIEF
WHEREFORE, Plaintiff Krage prays judgment against the Defendants, and each of them, including DOE Defendants, jointly and severally, as follows:
1. 	That an injunction be issued against Defendants to stop Foreclosure.
2. 	For a judgment that plaintiff is the owner in fee simple of the property and that defendants have no interest in the property adverse to the plaintiff;
3. 	That the note be declared void.
4. 	That defendant deliver the note immediately to the clerk of the court for cancellation.
5. 	For damages, in the event that defendant fails to surrender the note for cancellation pursuant to the judgment, in the sum of $350,000, plus interest thereon from and after May 3, 2007, at the rate of 7 percent per annum, as compensation and in lieu of cancellation.
6. 	That Plaintiff’s duty under 15 USC 1635(b) to tender restitution be excused because the debtor Plaintiff tendered an over “Offer of Restitution”, which the Defendants refused, and thereby failed to comply with the statutes.
7. 	For compensatory damages.
8. 	For Statutory damages.
9. 	For exemplary and punitive damages.
10. 	For pre-judgment and post-judgment interest.
11. 	For costs of suit herein incurred.
12. 	For Attorney Fees if counsel is retained.
13. 	For an Injunction against Defendants.
14. 	For such other and further relief as the court may deem proper.

Date:  May 22, 2008			By: ___________________________________
James-Arthur : Krage, as an individual and as Administrator and sole heir of the Estate of Verna Gladys Kroemer Krage, the borrower and real party in interest

VERIFICATION
I, James-Arthur : Krage, am the plaintiff in this action. I have read the foregoing complaint and know the contents thereof. The same is true and correct of my own knowledge, except as to those matters that are specifically stated therein on information and belief, and, as to those matters, I believe them to be true.
I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct.
Date:   May 22, 2008			______________________________________ 
James-Arthur : Krage, as an individual and as Administrator and sole heir of the Estate of Verna Gladys Kroemer Krage, the borrower and real party in interest

PROOF OF SERVICE

James-Arthur : Krage v.
Christopher L. Boulter and Val-Chris Investments
Bruce R. Beasley and RESS Financial Corporation

CASE NO. VC050979

L. A. Superior Court (Unlimited Jdcn.)
Norwalk Courthouse

	I, the undersigned, hereby declare: I am Patricia-Ann : Mele-Krage My mailing address is 10418 Ives Street  Bellflower, CA 90706.
 I am over the age of eighteen (18) years, and not a party to the within action.

	Today I served the following papers:
COMPLAINT FOR CANCELLATION OF WRITTEN INSTRUMENT

	Upon the following persons:

Christopher L. Boulter, 2601 Main St Suite 280, Irvine, CA 92614

__X__   Service was by PERSONAL DELIVERY (Substituted Service at the place of Business)

______   Service was by FIRST CLASS MAIL, in a sealed envelope, properly addressed, postage fully prepaid, deposited into the US Postal Service in Bellflower, Calif.

	I declare under penalty of perjury that this entire declaration is true and correct.
Executed at Bellflower, Calif. on May 22, 2008.

						________________________________
	Patricia-Ann : Mele-Krage.

PROOF OF SERVICE

James-Arthur : Krage v.
Christopher L. Boulter and Val-Chris Investments
Bruce R. Beasley and RESS Financial Corporation

CASE NO. VC050979

L. A. Superior Court (Unlimited Jdcn.)
Norwalk Courthouse

	I, the undersigned, hereby declare: I am Patricia-Ann : Mele-Krage My mailing address is 10418 Ives Street  Bellflower, CA 90706.
 I am over the age of eighteen (18) years, and not a party to the within action.

	Today I served the following papers:
COMPLAINT FOR CANCELLATION OF WRITTEN INSTRUMENT

	Upon the following persons:

Val-Chris Investments, 2601 Main St Suite 280, Irvine, CA 92614

__X__   Service was by PERSONAL DELIVERY

______   Service was by FIRST CLASS MAIL, in a sealed envelope, properly addressed, postage fully prepaid, deposited into the US Postal Service in Bellflower, Calif.

	I declare under penalty of perjury that this entire declaration is true and correct.
Executed at Bellflower, Calif. on May 23, 2008.

						________________________________
	Patricia-Ann : Mele-Krage.

PROOF OF SERVICE

James-Arthur : Krage v.
Christopher L. Boulter and Val-Chris Investments
Bruce R. Beasley and RESS Financial Corporation

CASE NO. VC050979

L. A. Superior Court (Unlimited Jdcn.)
Norwalk Courthouse

	I, the undersigned, hereby declare: I am Patricia-Ann : Mele-Krage. My mailing address is 10418 Ives Street   Bellflower, California 90706.
 I am over the age of eighteen (18) years, and not a party to the within action.

	Today I served the following papers:
COMPLAINT FOR CANCELLATION OF WRITTEN INSTRUMENT

	Upon the following persons:

Bruce R. Beasley  1780 Town and Country Drive Suite 105 Norco, CA 92680-3618

RESS Financial Corporation 1780 Town and Country Drive Suite 105 Norco, CA 92680-3618

__X__   Service was by PERSONAL DELIVERY (For Beasley, Substituted Service at the place of Business)

______   Service was by FIRST CLASS MAIL, in a sealed envelope, properly addressed, postage fully prepaid, deposited into the US Postal Service in Bellflower, Calif.

	I declare under penalty of perjury that this entire declaration is true and correct.
Executed at Bellflower, Calif. on May 23, 2008.

						________________________________.
	Patricia-Ann : Mele-Krage