In Yvanova v. New Century Mortgage Corp the California Supreme Court held that in a case where a homeowner alleges a nonjudicial foreclosure sale was wrongful because of a void assignment, the homeowner has standing to sue for wrongful foreclosure.

  In Sciarratta v. U.S. Bank National Association the question of “prejudice” left open in Yvanova was decided. Where a homeowner alleges foreclosure by one with no right to do so, do such allegations alone establish the requisite prejudice or harm necessary to state a cause of action for wrongful foreclosure?  Or instead, to adequately plead prejudice, does the plaintiff-homeowner have to allege the wrongful foreclosure interfered with his or her ability to pay on the debt, or lead to a foreclosure that would not have otherwise occurred? 

  The Sciarratta court held that the policy considerations that drove the standing analysis in Yvanova compel a similar result, reasoning that as the Supreme Court stated in Yvanova, it would be an “‘odd result’ indeed” were a court to conclude a homeowner had no recourse where anyone, even a stranger to the debt, had declared a default and ordered a trustee’s sale.

  The court concluded that a homeowner who has been foreclosed on by one with no right to do so—by those facts alone—sustains prejudice or harm sufficient to constitute a cause of action for wrongful foreclosure. The void assignment is the proximate cause of actual injury and all that is required to be alleged to satisfy the element of prejudice or harm in a wrongful foreclosure cause of action itself.

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