Magistrate Chen, in this excellent and simple analysis shows how the middlemen are trying to steal homeowner’s property, defraud investors who put up the money to fund the loan, and abuse the non-judicial and judicial process of foreclosure.
See also Judgment Against Ameriquest, Deutsch Bank et al for Rescission, damages and Attorneys Fees at ameriquest-mortgage-company-deutsche-bank-national-trust-and-amc-mortgage-services-inc
- See, e.g., McCoy v. Harriman Utility Bd., 790 F.2d
> 493, 496 (6th Cir. 1986) (stating that, if the material disclosures are made
> by the creditor, then under § 1635(a) the obligor has only three days to
> rescind; however, if the disclosures are not made, then the obligor has
> the right to rescind for up to three years pursuant to § 1635(f)). As noted
> above, one of the bases for rescission asserted by Ms. Hillery was the
> failure to provide material disclosures.
> C. Standing
>
> Defendants contend that, even if there is subject matter jurisdiction, both
> Consumer and Saxon lack standing to pursue this litigation. 2 It is well
> established that a plaintiff must prove standing by showing: (1) injury in
> fact; (2) a causal connection between the injury and the defendant’s
> conduct; and (3) a likelihood that a favorable outcome will redress the
> injury. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61, 112 S. Ct.
> 2130, 119 L. Ed. 2d 351 (1992).- Consumer [*14] seeks, in essence, to “enforce the [Promissory] Note and
> Deed of Trust if [Ms.] Hillery does not pay the Rescission Balance by a date
> set by this Court.” Compl. P 27. Thus, as Consumer itself acknowledges, to
> proceed with this action, it must demonstrate that it is the holder of not
> only the deed of trust but also the promissory note. If not, it has no
> injury in fact. See In re ForeclosureCases, 521 F. Supp. 2d 650, 653 (S.D.
> Oh. 2007) (stating that, “[t]o show standing in a foreclosure action, . . .
> the plaintiff must show that it is the holder of the note and the mortgage
> at the time the complaint was filed [and] . . . that the holder of the note
> and mortgage is harmed, usually by not having received payments on the
> note”). - the Court concludes that there is insufficient evidence that
> Consumer has standing to proceed with this litigation. Dismissal is
> therefore warranted. 3 The dismissal, however, shall be without prejudice,
> and Consumer shall be given leave to file an amended complaint. Such a
> complaint must include not only allegations that Consumer is the current
> holder of both the deed of trust and promissory note but also evidence
> supporting such. - Whether or not Saxon, the servicer of the loan, has standing in the instant
> case rises and falls with whether or not Consumer has standing. See In re
> Kang Jin Hwang, 393 B.R. 701, 712 (C.D. Cal. 2008)(indicating that a loan
> servicer cannot bring an action without the holder of the promissory note).
> That is, if Consumer can demonstrate that it is the owner of both the deed
> of trust and the promissory note, then it was proper for Saxon to have been
> named a plaintiff at the outset of the litigation along with Consumer.
> 2008 U.S. Dist. LEXIS 100056, *
> SAXON MORTGAGE SERVICES, INC., et al., Plaintiffs, v. RUTHIE B. HILLERY, et
> al., Defendants.
> No. C-08-4357 EMC,(Docket No. 7)
> UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA
> 2008 U.S. Dist. LEXIS 100056
>
> December 9, 2008, Decided
> December 9, 2008, Filed
>
> CORE TERMS: consumer’s, deed, promissory note, law firm, deed of trust,
> mortgage, rescission, summons, service of process, servicer, subject matter
> jurisdiction, disclosures, holder, inter alia, right to rescind, proof of
> service, assigned, declaratory relief, loan transaction, statute of
> limitations, declaration, transferred, household, effected, mailing, assign,
> declaratory judgment, prima facie case, attorney-client, personally
>
> COUNSEL: [*1] For Saxon Mortgage Services, Inc., formerly known as Meritech
> Mortgage Services, Inc., Consumer Solutions REO, LLC, Plaintiffs: T. Robert
> Finlay , LEAD ATTORNEY, Wright Finlay & Zak, LLP, Newport Beach, CA.
>
> For Ruthie B. Hillery, Spielbauer Law Firm, Defendants: Thomas John
> Spielbauer , LEAD ATTORNEY, The Spielbauer Law Firm, San Jose, CA.
>
> JUDGES: EDWARD M. CHEN , United States Magistrate Judge.
>
> OPINION BY: EDWARD M. CHEN
>
>
> OPINION
>
> ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS
>
> Plaintiffs Saxon Mortgage Services, Inc. and Consumer Solutions REO, LLC
> have filed suit against Defendants Ruthie B. Hillery and the Spielbauer Law
> Firm, asserting claims for, inter alia, declaratory relief pursuant to the
> Truth in Lending Act (“TILA”). Currently pending before the Court is
> Defendants’ motion to dismiss. Having considered the parties’ briefs and
> accompanying submissions, as well as the oral argument of counsel, the Court
> hereby GRANTS the motion to dismiss. The dismissal shall be without
> prejudice, and Consumer shall have leave to amend.
>
> I. FACTUAL & PROCEDURAL BACKGROUND
>
> Based on the record submitted, it appears that Ms. Hillery is the owner of
> certain real property located at 2119 Goff Avenue, Pittsburg, California.
> That property [*2] is her home. On or about August 18, 2006, Ms. Hillery
> obtained a loan in the principal sum of $ 366,000 from New Century Mortgage
> Corporation. See Compl., Ex. A (Deed at 2). A deed of trust for Ms.
> Hillery’s home secured to New Century repayment of the loan. See Compl., Ex.
> A (Deed at 3).
>
> Pursuant to the deed of trust, Mortgage Electronic Registration Systems,
> Inc. (“MERS”) was named as nominee for New Century and its successors. See
> Compl., Ex. A (Deed at 2-3). In addition, MERS was designated the
> beneficiary of the deed. Notably, the deed provided that even though MERS
> held “only legal title to the interests granted by [Ms. Hillery] in this
> Security Instrument,” MERS was given the right “if necessary to comply with
> law or custom . . to exercise any or all of those interests [granted by Ms.
> Hillery], including, but not limited to, the right to foreclose and sell the
> Property [i.e., Ms. Hillery’s home], and to take any action required of [New
> Century] including, but not limited to, releasing and canceling [the deed of
> trust].” Compl., Ex. A (Deed at 3).
>
> Apparently, within three days of obtaining the loan from New Century, Ms.
> Hillery tried to rescind the loan transaction pursuant to [*3] TILA. See
> Compl. P 16 & Ex. C (cancellation, dated 8/21/06). Approximately a year
> later, on September 28, 2007, Saxon — acting as the servicer for the loan
> — stated that it had received Ms. Hillery’s request to rescind. According
> to Saxon, it was “prepared to resolve [the] claim provided [that Ms.
> Hillery] accomplish [] the rescission by paying [$ 266,379.31] with[in] 30
> days and returning [an] enclosed Settlement Agreement and Release.” Compl.,
> Ex. E (letter, dated 9/28/07).
>
> Almost a year later, on or about June 20, 2008, MERS, acting as nominee for
> New Century, assigned the deed of trust to Consumer. In the assignment, MERS
> claimed to assign not only the deed of trust but also the promissory note
> itself (i.e., the debt owed by Ms. Hillery to New Century for the loan that
> was extended to her). See Compl., Ex. D (assignment, recorded on 7/21/08).
> However, there is no evidence of record that New Century ever assigned MERS
> the promissory note or otherwise gave MERS the authority to assign the note.
>
> On September 17, 2008, both Consumer and Saxon initiated this action against
> Ms. Hillery and her counsel, the Spielbauer law firm, asserting claims for,
> inter alia, declaratory relief pursuant [*4] to the Truth in Lending Act
> (“TILA”). Defendants responded by filing the currently pending motion to
> dismiss.
>
> II. DISCUSSION
>
> In their motion, Defendants argue that they are entitled to dismissal based
> on insufficient service of process, lack of subject matter jurisdiction,
> lack of standing, failure to state a claim for relief, and failure to join
> an indispensable party. Each of the arguments is addressed below.
>
> A. Service of Process
>
> Federal Rule of Civil Procedure 4 governs service of process. Rule 4(e)
> applies to individuals such as Ms. Hillery. Because Thomas Spielbauer does
> business as the Spielbauer Law Firm, see Spielbauer Decl. at 1, service of
> process as to the Spielbauer Law Firm is also controlled by Rule 4(e). Under
> Rule 4(e), service may be effected on an individual by, inter alia, “leaving
> a copy of [the summons and complaint] at the individual’s dwelling or usual
> place of abode with someone of suitable age and discretion who resides
> there,” Fed. R. Civ. P. 4(e)(2)(B), or by “delivering a copy of each to an
> agent authorized by appointment or by law to receive service of process.”
> Fed. R. Civ. P. 4(e)(2)(C). Service may also be effected pursuant to state
> law — here, California [*5] law. See Fed. R. Civ. P. 4(e)(1). Under
> California law, “substitute service” is permissible. See Cal. Code Civ.
> Proc. § 415.20(b). The relevant statute provides as follows:
> If a copy of the summons and complaint cannot with reasonable diligence be
> personally delivered to the person to be served, as specified in Section
> 416.60, 416.70, 416.80, or 416.90, a summons may be served by leaving a copy
> of the summons and complaint at the person’s dwelling house, usual place of
> abode, usual place of business, or usual mailing address other than a United
> States Postal Service post office box, in the presence of a competent member
> of the household or a person apparently in charge of his or her office,
> place of business, or usual mailing address other than a United States
> Postal Service post office box, at least 18 years of age, who shall be
> informed of the contents thereof, and by thereafter mailing a copy of the
> summons and of the complaint by first-class mail, postage prepaid to the
> person to be served at the place where a copy of the summons and complaint
> were left. Service of a summons in this manner is deemed complete on the
> 10th day after the mailing.Cal. Code Civ. Proc. § 415.20(b).
>
> 1. Ms. [*6] Hillery
>
> According to Plaintiffs, substitute service was effected on Ms. Hillery in
> accordance with § 415.20(b) above. In support of this contention, Plaintiffs
> have offered a proof of service signed by a process server under penalty of
> perjury. The proof of service reflects that a copy of the summons and
> complaint were left with a member of the household over the age of 18 (a
> description of the person is provided in the proof of service) and that
> thereafter the documents were mailed to Ms. Hillery. The proof of service
> also reflects that, prior to resort to substitute service, service was
> attempted on Ms. Hillery personally two times. Thus, Plaintiffs have
> presented a prima facie case of valid service pursuant to § 415.20(b), and,
> under Ninth Circuit law, the prima facie case may “be overcome only by
> strong and convincing evidence.” SEC v. Internet Solns. for Bus., Inc., 509
> F.3d 1161, 1167 (9th Cir. 2007) (internal quotation marks omitted).
>
> The Court finds that Ms. Hillery has failed to provide strong and convincing
> evidence that service was not proper. In so finding, the Court acknowledges
> the declarations provided by Ms. Hillery and her grandson, Tyrone Thames.
> However, those declarations [*7] are not enough to overcome the prima facie
> case established by Plaintiffs. For example, even if Mr. Thames was not
> personally served with the summons and complaint, and even if he found the
> papers on Ms. Hillery’s doorstep, see Thames Decl. at 1-2, that does not
> mean that there was not another member of the household who did receive the
> papers and who then left them on the doorstep. Defendants have not provided
> any evidence indicating that the only occupants of the household are Ms.
> Hillery and her grandson.
>
> Accordingly, Defendants’ motion to dismiss the action with respect to Ms.
> Hillery on the basis of insufficient service of process is denied.
>
> 2. Spielbauer Law Firm
>
> At the time that Defendants filed their motion to dismiss (i.e., on October
> 17, 2008), in which they contested, inter alia, the adequacy of service of
> process, it appears that service had not yet been effected on the Spielbauer
> Law Firm. Rather, as reflected in a proof of service signed by a process
> server under penalty of perjury, service was accomplished approximately a
> week later on October 24, 2008. More specifically, service was made by
> delivering a copy of the summons and complaint on Moni Hannemon, the person
> in [*8] charge of the office and one authorized to receive service of
> process for the law firm.
>
> In the reply brief, the Spielbauer Law Firm does not argue that Ms. Hannemon
> was not authorized to receive service of process. Rather, its only
> contention is that Plaintiffs deliberately served the law firm well after
> the allegedly improper service on Ms. Hillery in hopes of obtaining a
> “default upon her.” Reply at 9. However, as discussed above, service on Ms.
> Hillery was proper. Moreover, under the federal rules, Plaintiffs were free
> to effect service on the law firm on a different timeline from service on
> Ms. Hillery, so long as service on each was accomplished within 120 days
> after the filing of the complaint. SeeFed. R. Civ. P. 4(m). This was done.
>
> Accordingly, the Court denies the Spielbauer Law Firm’s motion to dismiss on
> the basis of insufficient service of process.
>
> B. Subject Matter Jurisdiction
>
> Defendants argue next that dismissal in the instant case is warranted for
> lack of subject matter jurisdiction. Plaintiffs’ position is that there is
> subject matter jurisdiction based on their claim for declaratory relief.
> According to Plaintiffs, “[t]here is no legitimate doubt that, were [Ms.]
> Hillery [*9] to have filed suit first, her claims would have included
> allegations of TILA violations.” Opp’n at 6.
>
> “A person may seek declaratory relief in federal court if the one against
> whom he brings his action could have asserted his own rights there.”
> Standard Ins. Co. v. Saklad, 127 F.3d 1179, 1181 (9th Cir. 1997). Of course,
> the Declaratory Judgment Act does not by itself confer subject matter
> jurisdiction. Rather, there must be an independent basis for such
> jurisdiction — i.e., federal jurisdiction over the suit that could have
> been brought by the defendant. Moreover, a declaratory judgment action is
> justiciable only “if ‘there is a substantial controversy, between parties
> having adverse legal interests, of sufficient immediacy and reality to
> warrant the issuance of a declaratory judgment.'” Seattle Audubon Soc’y v.
> Moseley, 80 F.3d 1401, 1405 (9th Cir. 1996). See Rhoades v. Avon Prods., 504
> F.3d 1151, 1157 (9th Cir. 2007) (“‘[A]n action for a declaratory judgment
> that a patent [or trademark] is invalid, or that the plaintiff is not
> infringing, [presents] a case or controversy if the plaintiff has a real and
> reasonable apprehension that he will be subject to liability if he continues
> to [*10] manufacture his product.'”).
>
> Based on the record submitted, the Court concludes that Consumer had a
> reasonable apprehension that it would face an action by Ms. Hillery over
> which this Court would have original jurisdiction — i.e., a TILA rescission
> claim. Prior to filing the lawsuit, Saxon (as the then-loan servicer) and
> MERS (as nominee for New Century, Consumer’s alleged
> predecessor-in-interest) had received letters from Ms. Hillery’s counsel,
> Mr. Spielbauer, in which he argued, inter alia, that Ms. Hillery, in
> accordance with her rights under TILA, had rescinded the loan transaction
> with New Century on August 21, 2006. Mr. Spielbauer also argued that the
> TILA disclosures that were given to Ms. Hillery were — to the extent they
> existed — so inaccurate so as to invalidate the loan transaction and
> subject it to rescission. See Mot., Ex. 5 (letters, dated May 24, 2008).
> Notably, Mr. Spielbauer stated that “Ms. Hillery is prepared to file suit to
> have this loan declared void” if required by the servicer or note holder to
> do so. Mot., Ex. 4 (letters, dated May 24, 2008).
>
> Citing Hagans v. Lavine, 415 U.S. 528, 94 S. Ct. 1372, 39 L. Ed. 2d 577
> (1974), Defendants argue that a federal claim that is insubstantial cannot
> serve [*11] as the basis for federal question jurisdiction; — i.e., if it
> is “essentially fictitious” or “obviously frivolous.” Id. at 538 (internal
> quotation marks omitted). See Mot. at 19. But Defendants have failed to
> demonstrate TILA rescission claim identified by Plaintiffs would be
> insubstantial. Ms. Hillery threatened to bring a TILA rescission claim so
> the claim cannot be characterized as fictitious. Moreover, such a claim is
> not obviously without merit. For example, the claim is not obviously time
> barred since Ms. Hillery does not appear to be seeking any damages as relief
> but rather only rescission of the loan transaction and thus, as all parties
> agreed at the hearing, was well within the three year statute of limitations
> under 15 U.S.C. § 1635(f). 1
>
> FOOTNOTES
>
> 1 If Ms. Hillery were seeking damages pursuant to TILA, then that claim
> would be subject instead to a one-year statute of limitations. See 15 U.S.C.
> § 1640(e) (stating that “[a]ny action under this section [which authorizes
> individual or class actions for damages] may be brought . . . within one
> year from the date of the occurrence of the violation”); Beach v. Ocwen Fed.
> Bank, 523 U.S. 410, 412, 118 S. Ct. 1408, 140 L. Ed. 2d 566 (1998) (noting
> that “[s]ection 1640(e) provides [*12] that an action for [statutory and
> actual] damages ‘may be brought’ within one year after a violation of the
> Act”).
>
> However, “[t]he right to rescind is not dependent upon the one year statute
> of limitations period for a claim for damages.” Rudisell v. Fifth Third
> Bank, 622 F.2d 243, 248 (6th Cir. 1980); see also; Knox v. Ameriquest Mortg.
> Co., No. C-05-00240 SC, 2005 U.S. Dist. LEXIS 40709, at *9-10 (N.D. Cal.
> Aug. 10, 2005) (Conti, J.) (distinguishing TILA damage claims and TILA
> rescission claims). Where an obligor brings a claim for rescission only
> based upon the creditor’s failure to provide material disclosures required
> by TILA, then there is a three-year statute of limitations under § 1635(f).
> See 12 C.F.R. § 226.23(a)(3) (“Regulation Z”) (providing that “[t]he
> consumer may exercise the right to rescind until midnight of the third
> business day following consummation, delivery of the notice [of the right to
> rescind], or delivery of all material disclosures”; adding that, “[i]f the
> required notice or material disclosurse are not delivered, the right to
> rescind shall expire 3 years after consummation, upon transfer of all of the
> consumer’s interest in the property, or upon sale of [*13] the property,
> whichever occurs first”). See, e.g., McCoy v. Harriman Utility Bd., 790 F.2d
> 493, 496 (6th Cir. 1986) (stating that, if the material disclosures are made
> by the creditor, then under § 1635(a) the obligor has only three days to
> rescind; however, if the disclosures are not made, then the obligator has
> the right to rescind for up to three years pursuant to § 1635(f)). As noted
> above, one of the bases for rescission asserted by Ms. Hillery was the
> failure to provide material disclosures.
>
>
> Accordingly, the Court concludes there is federal question jurisdiction over
> Consumer’s claim for declaratory relief.
>
> C. Standing
>
> Defendants contend that, even if there is subject matter jurisdiction, both
> Consumer and Saxon lack standing to pursue this litigation. 2 It is well
> established that a plaintiff must prove standing by showing: (1) injury in
> fact; (2) a causal connection between the injury and the defendant’s
> conduct; and (3) a likelihood that a favorable outcome will redress the
> injury. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61, 112 S. Ct.
> 2130, 119 L. Ed. 2d 351 (1992).
>
> FOOTNOTES
>
> 2 Defendants’ argument that Plaintiffs have failed to state a claim for
> relief essentially duplicates the standing argument.
>
>
> 1. Consumer
>
> Consumer [*14] seeks, in essence, to “enforce the [Promissory] Note and
> Deed of Trust if [Ms.] Hillery does not pay the Rescission Balance by a date
> set by this Court.” Compl. P 27. Thus, as Consumer itself acknowledges, to
> proceed with this action, it must demonstrate that it is the holder of not
> only the deed of trust but also the promissory note. If not, it has no
> injury in fact. See In re ForeclosureCases, 521 F. Supp. 2d 650, 653 (S.D.
> Oh. 2007) (stating that, “[t]o show standing in a foreclosure action, . . .
> the plaintiff must show that it is the holder of the note and the mortgage
> at the time the complaint was filed [and] . . . that the holder of the note
> and mortgage is harmed, usually by not having received payments on the
> note”).
>
> There is evidence that the deed of trust was transferred to Consumer. As
> noted above, New Century designated MERS the beneficiary of the deed and
> gave MERS broad authority to act with respect to the property. See Compl.,
> Ex. A (Deed at 3) (stating that MERS “has the right to exercise any or all
> of those interests [granted by Ms. Hillery] in this Security Instrument”).
> The Court thus assumes MERS had the power to assign the deed to Consumer,
> which it apparently [*15] did on or about June 20, 2008. See Compl., Ex. D
> (assignment, recorded on 7/21/08).
>
> However, for there to be a valid assignment, there must be more than just
> assignment of the deed alone; the note must also be assigned. See Carpenter
> v. Longan, 83 U.S. 271, 274, 21 L. Ed. 313 (1872)(stating that “[t]he note
> and mortgage are inseparable; the former as essential, the latter as an
> incident”; adding that “[a]n assignment of the note carries the mortgage
> with it, while an assignment of the latter alone is a nullity”); In re
> Leisure Time Sports, Inc. 194 B.R. 859, 861 (9th Cir. 1996) (stating that
> “[a] security interest cannot exist, much less be transferred, independent
> from the obligation which it secures” and that, “[i]f the debt is not
> transferred, neither is the security interest”); Kelley v. Upshaw, 39 Cal.
> 2d 179, 192, 246 P.2d 23 (1952) (stating that assigning only the deed
> without a transfer of the promissory note is completely ineffective); see
> also Restatement (3d) of Property (Mortgages) § 5.4 (stating that “[a]
> mortgage may be enforced only by, or in behalf of, a person who is entitled
> to enforce the obligation that the mortgage secures”) (emphasis added). As
> Kelley establishes, this is true under California [*16] law which
> presumably applies here.
>
> As noted above, MERS purportedly assigned both the deed of trust and the
> promissory note to Consumer. See Compl., Ex. D (assignment, recorded on
> 7/21/08). However, there is no evidence of record that establishes that MERS
> either held the promissory note or was given the authority by New Century to
> assign the note. Indeed, Consumer’s own complaint contains only an
> allegation about assignment of the deed of trust — and not the note. See
> Compl. P 17 (alleging that “New Century assigned its beneficial interest of
> the Deed of Trust to Plaintiff Consumer Solutions”).
>
> Accordingly, the Court concludes that there is insufficient evidence that
> Consumer has standing to proceed with this litigation. Dismissal is
> therefore warranted. 3 The dismissal, however, shall be without prejudice,
> and Consumer shall be given leave to file an amended complaint. Such a
> complaint must include not only allegations that Consumer is the current
> holder of both the deed of trust and promissory note but also evidence
> supporting such. The amended complaint must be filed no later than December
> 19, 2008. Defendants shall then have until January 30, 2009, to file a
> response. A case management [*17] conference shall thereafter be held on
> February 4, 2009, at 1:30 p.m.
>
> FOOTNOTES
>
> 3 In their motion to dismiss, Defendants further argue for dismissal based
> on failure to join an indispensable party. At this juncture, the Court
> cannot make any determination about joinder because it is not clear who
> currently owns the promissory note at issue. The bottom line is that if, as
> Consumer claimed at the hearing on the motion to dismiss, it currently owns
> the promissory note, then there will likely be no joinder problem.
>
>
> 2. Saxon
>
> Whether or not Saxon, the servicer of the loan, has standing in the instant
> case rises and falls with whether or not Consumer has standing. See In re
> Kang Jin Hwang, 393 B.R. 701, 712 (C.D. Cal. 2008)(indicating that a loan
> servicer cannot bring an action without the holder of the promissory note).
> That is, if Consumer can demonstrate that it is the owner of both the deed
> of trust and the promissory note, then it was proper for Saxon to have been
> named a plaintiff at the outset of the litigation along with Consumer.
>
> Defendants contend that Saxon cannot have standing because it was no longer
> the servicer of the loan at the time the original complaint was filed on
> September 17, 2008. [*18] The Court does not agree. The evidence of record
> indicates that Saxon did transfer loan servicing to another entity, EverHome
> Mortgage Company (“EverHome”), but the transfer was effective after the date
> of the filing of the complaint, i.e., on October 1, 2008. See Mot., Ex. 7
> (letter, dated 9/16/08, notifying Ms. Hillery that, effective 10/1/08,
> EverHome Mortgage Company would be the loan servicer).
>
> Of course, it does appear that, currently, Saxon is no longer the loan
> servicer. Because the Court is requiring that an amended complaint be filed,
> Plaintiff may want to substitute Saxon out of the complaint.See Fed. R. Civ.
> P. 25(c) (providing that, “[i]f an interest is transferred, the action may
> be continued by or against the original party unless the court, on motion,
> orders the transferee to be substituted in the action or joined with the
> original party”); see also Hilbrands v. Far East Trading Co., 509 F.2d 1321,
> 1323 (9th Cir. 1975) (noting that defendant “never made a motion for
> substitution, only the motion for summary judgment against [plaintiff]” and
> therefore she should “have been permitted to continue the action”).
>
> D. Attorney-Client Privilege
>
> In their reply brief, Defendants [*19] ask the Court to find that
> Plaintiffs waived their attorney-client privilege with respect to their
> counsel’s files in the matter because of statements made by Jonathan Fink,
> one of their attorneys, in his declaration in support of the opposition to
> the motion to dismiss. Although the request should have been made in a
> separately noticed motion, the Court rejects it now because it is completely
> without merit. The attorney-client privilege protects only confidential
> communications, see United States v. Martin, 278 F.3d 988, 999 (9th Cir.
> 2002), and there is nothing in Mr. Fink’s declaration that could be
> characterized as a confidential communication.
>
> This order disposes of Docket No. 57.
>
> IT IS SO ORDERED.
>
> Dated: December 9, 2008
>
> /s/ Edward M. Chen
>
> EDWARD M. CHEN
>
> United States Magistrate Judge
Filed under: CDO, currency, Eviction, foreclosure, GTC | Honor, Investor, MODIFICATION, Mortgage, securities fraud | Tagged: borrower, disclosure, Eviction, foreclosure, foreclosure defense, foreclosure offense, fraud, Lender Liability, Mortgage, rescission, RESPA, TILA, trustee |
[…] In Saxon Mortg. Services, Inc. v. Hillery, C-08-4357EMC, 2008 WL 5170180 (N.D. Cal. Dec. 9, 2008), the United States District Court, in the Northern District of California granted Hillery’s motion to dismiss because Saxon Mortgage Services, Inc., lacked standing. […]
Angela,
When you focus on the evidence that proves your loan was PAID-IN-FULL, it becomes much easier to ask the court for an order to clear the title, and call it a day. We provide this evidence, and refer an attorney to take on your case. We know so many homeowners have been wronged and need help!
Please contact us as soon as you can!
Mortgage Legal Defense Associates
714-845-7228
30#2009#00320493 civil case open for two years Central Justice Court, Santa Ana, CA. I am the Planfiff , Mers, Saxon & Consumer REO are the defendants. I have been pro per with a fee waiver, my interest is to prove the intent of thier silence to Foreclosure plus whatever can be done.(everhome mtg). Seeking attorney that will fight the cause and hope for the best in the end. Mers just contacted my about the case, so this moved the case mgt date in to Oct 24, 2011. Thank you, hope someone can give it a try, the judge has been very good & the courts to keep it open for this long. I need someone to help me close this. contact me pls.
Do you anyone that can help in Orange County, Ca. My case has been open for two years in pro per in the Central Justice Court, Santa Ana. 30#2009#00320493. I am the Plantiff, Saxon, Mers and Consumer Reo are the defendants. Everytime I think it will be dimissed, the case continues. The court dates are moved over into one month, Oct 14 & Oct 24 case mgt conf. I really want to fight regarding thier intent (unmoral) & unduly perfect foreclosure…. Mers just responded to the case, I haven’t seen Saxon and Consumer has been carrying the ball. I have a fee waiver, go for the cause and hope for the best in the end, contact me please.
So, How are all of you fairing?
Has your case come down to those all powerful words, “Your Argument is Frivolous”
Or has the Judge Ignored everything as if it did not exist in front of his very eyes?
What Now?
My home goes to Sale Monday!
The Judge Claimed he wanted every issue in the complaint addressed, the defendant filed an answer…finally but didn’t address a damned thing!
Now What?
What remedy do we have if those who are supposed to help you get that remedy are working for the criminal?
Utah courts are owned, Cache County Judge is bought!
Can I have my property my property annex to a state who’s officials/Judges do not have their head buried in some bankers back side? Joking, but what if? HOME FOR SALE! CHEAP! only twice its Value!
Daniel, daniel.l@digis.net
SURE….. And the IRS, control junkies, are salivating, over, all the “Forgiven,” debts, as if, laundering the banksters’ antics, in all over the world, sales of unsecured, notes, will put the American Slaves, at risk, to the “Internal,” Ponzi scheme, RS, for all the “gain,” while nailing or not nailing the banksters, illicit income; scammed by the fraudulent sales of notes, known to have no collateral, [all over the world]… and, the question one might ask: “Were all the bundled mortgage bricks, wherein, thousands of photoclones of original notes, could/would be concealed, located in the 9/11 Murder of 3,000 People..in the “Trade Center”…??? Just a thought, but, if not, then, who, will be entrusted to audit the bricks, to see how many forged notes have unjustly rewarded the MERS/Bankster conspiracy, compelled by what logical motive which would have compelled the banksters, to spin off the notes from the mortgages, so as to leave the notes, uncollateralized, if not, the scam of selling thousands of bogus “originals,” into the obscurity of worldwide commerce??? Is there any reasonable other explanation for banksters to conspire away the collateral, of, their trusting investors, and, isn’t such an act, bank fraud, in itself ? And, most importantly: How is it that 1,000 Mers owners, can control 100 million American Homes, without, being involved in some Organized Crime At Law, sleight of mind, govern mental, scam ? Criminal enough to “9/11” 3,000 innocent people, while a select few, exemptees, stayed home…??? Is this Country, that evil… then, to, further reward the banksters with bailout money; as in, are they being bribed for not ratting out the 1,000 who have created MERS; Which owns nothing; has no monetary interest; yet, sells pies in the sky, to those, who don’t know that they are buying unsecured notes, under the title, of “Fractilization, and, Securitization;” which they admit, means nothing ? And, the IRS, can hardly wait, to get itself substituted as the hammer with which to pass the whip, to the next criminal in line to handle the baton… as if, the Sheeple will never rise above the shackles of those Organized Crime At Law, Govern Mentals, who want to run the world… Don’t forget to reelect, Obozo, you hear…??? Edgrrr… Stalag Skew, Ahnolds’ Gulag, Schizofornia… United States Socialistic Republic [U.S.S.R.]…. And, who, with an iota of consciousness, would design multimillion dollar aircraft, with a door, leading into the hijacker compartment, and, without, ground based computer override systems in place, so as to not leave the passengers subject to, what allegedly happened…or, did they, actually control those planes from the ground??? Any govern mentals, as evil as the toadies of the system; hell bent, to worship, Obozo, the Bleating Heart Sheeples’ Messiah; a 12 year old Valley Girl, with the cutesy abbreviated word endings, and, a curtsy after every, canned; written for him, speech,; “President Pantywaist,” and, the probable, reelection of the snake oil salesman, who, hijacked, a nation, deserve, the govern mentals that they, elect… Edgrrr…. Stalag, Schizofornia….
Hi, I have a similar situation in my own case. I have a few questions if anyone could answer..Please.
I am the Plaintiff in a case suing Mortgage Co, Popular Mortgage inc, The Mortgage Broker, and his entity, and the Insurance Company.
My initial problem was when broker made many deceitful misreps, regarding the outcome, how much the loan would be along with out ability to pay. He also handled our taxes and financial advice.
Pushed and under duress I agreed. The HUD 1 settlement sheet was reproduced with different accounting approximately 5 times, several of those times someone?
added my (exact copy of) signature, digitally photoshopped it has been dubbed. In additon my husbands name was added to Mortgage and a few other docs. We found out 9 months later. As time went on we found more and more.
I do know the following…
This loan was sold to a pool, names on a Clayton due diligence report are Duetsche and Equity One, a subsidiary at that time of Popular Inc. I don;t understand findings, but it mentions the hmda is not accurate it is high, and some others as well.
I rescinded loan in June one year after mortgage closing. it was ignored until 11 weeks later.
It was suggested i give up all rights and pay. (attorney advice) Popular filed foreclsure, and the state stepped in on my behalf reminding them they were being investigated.
They apologized and time went on. The rescission came just before filing suit.
It appears to have been passed to a couple more Pools, can’t imagine how you sell in this manner more than once. (while maintaining servicing)
Eventually it was passed on to another servicer, who had it one month and sent it back.
In the meantime, the relationship with attorney ended, neither of us happy. He was uncooperative with return of files and that held me up. I could not find an attorney, I did try one of yours, she felt it was too complex for her expertise.
As did every attorney after that. I carried on alone, and eventually found an attorney willing to take as contingency.
I had run out of funds, and wasn’t sure, but we started to work together. He still has not had me sign a contract, and as it appears he devotes an unknown amount of time, but what appears to be exceptionallimited, on my case. He tells me nothing and has missed each promised appointment to phone meeting. He has canceled deps for unknown reasons. Just wants to focus on Mod.
I began receiving suspicious mail for a few days, layer solicitations willing to rep my foreclosure or sheriff sale. Rescue mostly scams came too.
I called the State and checked to see if a foreclosure had been filed.
Yes, by Equity One, via MERS, as nominee for Popular. the a couple of days later MERS assigned Equity One at the county, and filed a lis Pendens. A bit out of order.
I asked the employees at the state office some questions were posed to their Attorney on staff to help in a limited aspect. I was told to send a letter, answer to the state.
As I did, I called checking to make sure they had not done anything I needed to know about. My attorney did not want to take the case, unless I gave him a retainer, which I could not afford, I offered him a generous deal feeling certain we could win. He said no.
It took me two months and I turned it in, and there still had not been a Service of foreclosure, no warning letter, nothing.
I answered to cover myself in case they would pull a fast one on me. They got my answer, and pretty soon after filed a default. Apparently they had filed a default, but my answer was put into the system 3 weeks earlier, the default came was stamped at foreclosure office 2 weeks before my answer. The staff attorney told me I did not need to send any response to the default.
The attorney for the Plaintiff would not take my calls. I forwarded a question, why would he write a default knowing my answer was on his desk 2 or more days, unopened?
Eventually I spoke to him. I told him about the rescission and their lack of standing. He said he would go check it out. He would pull out if true. He could not tell me the contact info for the Mortgage co. Of course,because I had already known that Equity One and Popular had ended their subsidiary. End of Dec. 3 months earlier. According to their Annual SEC they finalized all business in March. March was when my rescinded loan came into foreclosure threat.
We had our first meeting with the Judge and were ordered to have interrogatories. This has been very challenging for me. I sent in my documents and instructions to the Attorney, but forgot the questions. I have lost my hard drive and will now send. I did not get anextension, but twice called the attorney and faxed the Judge I was late with good reason. I will send my questions in the morning.
Our deadline for exchanging questions and requests for docs etc. ends this Friday. I don’t know if this includes outside parties, who are numerous,as it seems, a third Mortgage company claiming not only servicing but also ownership, and they told me this past week,they will be filing foreclosure. Popular assigned them, they assigned holder to them(the 3rd company) following that.
The above case reminds me a bit of mine in that MERS is involved, and standing and jurisdiction.
MERS said they do not foreclose. It was somewhat ambiguous.
I was going to well I go back and forth, file a joiner to add the 3 parties in Civil division. Now I see this and wonder if the ability to dismiss will escape me then. Maybe I can file both?
They have no standing, no jurisdiction. There are several companies involved. A rescission, that according to the opposing Attorney hasn’t beenfulfilled because I did not pay them, Yeah.
But knowing that Judges seem to go along with this thought I am scared. I am frozen in fear.
I spend 20 plus hours reading writing, and still I am no where. Time running out.
To top all this off, on Friday I received a letter saying there is a Case Management meeting on this Friday. Which I hate to go through. Knowing the attorney is not really working out, and that I want to join the parties, I am unsure what to do.
I am now alone with two children, my husband and I have split. Money is not coming in as it should, I am so tied up with this case I have not filed divorce yet. Also a large credit card debt that unknown to me, is in my name, I did not apply for this, or use it. It seems it was my husband who opened this with out my knowing. They did not make a deal, so now I am in default to answer with them. I also have a small credit card debt, collector, though I told i wanted to pay off, but had to wait they file default. I have since paid a small amount, but they call and call and won;t agree to send me anything or tell me if they received my payment.
Just putting all the sorted details out there.
by the way, for Neil, I did try calling again a lawyer, from the site, and had strange results, I could email you privately if you like.
I have not been working as I am so wrapped up in this. I am an artist and have a small online bus. so I want to get back to life. This feels like death. Anyone who can, please HELP.
As far as the above story, Ms Hillary, has she ended up with her home owning it outright?
I hope I have not been in wrong area.,
Thank you,
Juli
Hey do you think that maybe the intention of MERS was to deprive the states of revenue leading eventual contribution to the destrucion of our sovereignty?
Kevin Lamson: Don’t know who you are but this is an excellent submission. Keep it coming!
PUBLIC NOTICE CONCERNING LAWSUITS BEING COMMECNED UNDER THE NAME MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC. (“MERS”) AND SUGGESTED DISCOVERY REQUESTS AND DEMAND FOR DOCUMENTS IF YOU ARE SERVED WITH A LAWSUIT BY LAWYERS CLAIMING TO REPRESENT MERS.
April 10, 2009
MERS
Basic Corporate Information
· MERS is incorporated within the State of Delaware.
· MERS was first incorporated in Delaware in 1999.
· The total number of shares of common stock authorized by MERS’ articles of incorporation is 1,000.
· The total number of shares of MERS common stock actually issued is 1,000.
· MERS is a wholly owned subsidiary of MERSCorp, Inc.
· MERS’ principal place of business at 1595 Spring Hill Road, Suite 310, Vienna, Virginia 22182
· MERS’ national data center is located in Plano, Texas.
· MERS’ serves as a “nominee” of mortgages and deeds of trust recorded in all fifty states.
· Over 55 million loans have been registered on the MERS system.
· MERS’ federal tax identification number is “541927784”.
The Nature of MERS’ Business
· MERS does not take applications for, underwrite or negotiate mortgage loans.
· MERS does not make or originate mortgage loans to consumers.
· MERS does not extend any credit to consumers.
· MERS has no role in the origination or original funding of the mortgages or deeds of trust for which it serves as “nominee”.
· MERS does not service mortgage loans.
· MERS does not sell mortgage loans.
· MERS is not an investor who acquires mortgage loans on the secondary market.
· MERS does not ever receive or process mortgage applications.
· MERS is simply named as a nominee and its parent company MERS Corp Inc. maintains an electronic registry, tracks changes in the ownership of mortgage loans and servicing rights related thereto.
· MERS© System is not a vehicle for creating or transferring beneficial interests in mortgage loans.
· MERS is not named as a beneficiary of the alleged promissory note.
Ownership of Promissory Notes or Mortgage Indebtedness
· MERS is never the owner of the promissory note for which it seeks foreclosure.
· MERS has no legal or beneficial interest in the promissory note underlying the security instrument for which it serves as “nominee”.
· MERS has no legal or beneficial interest in the loan instrument underlying the security instrument for which it serves as “nominee”
· MERS has no legal or beneficial interest in the mortgage indebtedness underlying the security instrument for which it serves as “nominee”.
· MERS has no interest at all in the promissory note evidencing the mortgage indebtedness.
· MERS is not a party to the alleged mortgage indebtedness underlying the security instrument for which it serves as “nominee”.
· MERS has no financial or other interest in whether or not a mortgage loan is repaid.
· MERS is not the owner of the promissory note secured by the mortgage and has no rights to the payments made by the debtor on such promissory note.
· MERS does not make or acquire promissory notes or debt instruments of any nature and therefore cannot be said to be acquiring mortgage loans.
· MERS has no interest in the notes secured by mortgages or the mortgage servicing rights related thereto.
· MERS does not acquire any interest (legal or beneficial) in the loan instrument (i.e., the promissory note or other debt instrument).
· MERS has no rights whatsoever to any payments made on account of such mortgage loans, to any servicing rights related to such mortgage loans, or to any mortgaged properties securing such mortgage loans.
· The note owner appoints MERS to be its agent to only hold the mortgage lien interest, not to hold any interest in the note.
· MERS does not hold any interest (legal or beneficial) in the promissory notes that are secured by such mortgages or in any servicing rights associated with the mortgage loan.
· The debtor on the note owes no obligation to MERS and does not pay MERS on the note.
MERS’ Accounting of Mortgage Indebtedness / MERS Not At Risk
· MERS is not entitled to receive any of the payments associated with the alleged mortgage indebtedness.
· MERS is not entitled to receive any of the interest revenue associated with mortgage indebtedness for which it serves as “nominee”.
· Interest revenue related to the mortgage indebtedness for which MERS serves as “nominee” is never reflected within MERS’ bookkeeping or accounting records nor does such interest influence MERS’ earnings.
· Mortgage indebtedness for which MERS serves as the serves as “nominee” is not reflected as an asset on MERS’ financial statements.
· Failure to collect the outstanding balance of a mortgage loan will not result in an accounting loss by MERS.
· When a foreclosure is completed, MERS never actually retains or enjoys the use of any of the proceeds from a sale of the foreclosed property, but rather would remit such proceeds to the true party at interest.
· MERS is not actually at risk as to the payment or nonpayment of the mortgages or deeds of trust for which it serves as “nominee”.
· MERS has no pecuniary interest in the promissory notes or the mortgage indebtedness for which it serves as “nominee”.
· MERS is not personally aggrieved by any alleged default of a promissory note for which it serves as “nominee”.
· There exists no real controversy between MERS and any mortgagor alleged to be in default.
· MERS has never suffered any injury by arising out of any alleged default of a promissory note for which it serves as “nominee”.
MERS’ Interest in the Mortgage Security Instrument
· MERS is named on the mortgage as nominee for the owner of the promissory note.
· MERS, in a nominee capacity for lenders, claims that it merely acquires legal title to the security instrument (i.e., the deed of trust or mortgage that secures the loan).
· MERS claims that it holds legal title to mortgages and deeds of trust as a nominee for the owner of the promissory note.
· MERS claims that it immobilizes the mortgage lien while transfers of the promissory notes and servicing rights continue to occur.
· The lender or investor continues to own and hold the promissory note, but under the MERS® System, the servicing entity only holds contractual servicing rights and MERS holds legal title to the mortgage as nominee for the benefit of the investor (or owner and holder of the note) and not for itself.
· MERS claims that one of the advantages of its paperless systems is that the mortgage lien becomes immobilized by MERS continuing to hold the mortgage lien when the note is sold from one investor to another via an endorsement and delivery of the note or the transfer of servicing rights from one MERS member to another MERS member via a purchase and sale agreement which is a non-recordable contract right.
· MERS claims that the legal title to the mortgage or deed of trust remains in MERS after such transfers and is tracked by MERS in its electronic registry.
Beneficial Interest in the Mortgage Indebtedness
· MERS claims to hold legal title to the mortgage for the benefit of the owner of the note.
· The beneficial interest in the mortgage (or person or entity whose interest is secured by the mortgage) runs to the owner and holder of the promissory note and/or servicing rights thereunder.
· MERS has no interest at all in the promissory note evidencing the mortgage loan.
· MERS does not acquire an interest in promissory notes or debt instruments of any nature.
· The beneficial interest in the mortgage (or the person or entity whose interest is secured by the mortgage) runs to the owner and holder of the promissory note (NOT MERS).
MERS As Holder
· MERS is never the holder of a promissory note in the ordinary course of business.
· MERS is not a custodian of promissory notes underlying the security instrument for which it serves as “nominee”.
· MERS does not even maintain copies of promissory notes underlying the security instrument for which it serves as “nominee”.
· Sometimes when an investor or servicer desires to foreclose, the servicer obtains the promissory note from the custodian holding the note on behalf of the mortgage investor and places that note in the hands of a servicer employee who has been “appointed” as an officer (vice president and assistant secretary) of MERS by corporate resolution. This technique is used by attorneys who purport to be representing MERS to feign standing by MERS to foreclose the mortgage by claiming that MERS is the holder of the promissory note. When in fact MERS, by its inventors design is never the holder of the promissory note.
· When a promissory note is placed in the hands of a servicer employee that employee will then assume the position as an MERS officer de jour and pretend that this transfer of custody of the note into the hands of this nominal officer (without any transfer of ownership or beneficial interest) renders MERS the holder.
· No consideration or compensation is exchanged between the owner of the promissory note and MERS in consideration of this transfer in custody. MERS is a bankruptcy remote corporation, and does not have any assets.
· Even when the promissory note is physically placed in the hands of the servicer’s employee who is, at best, a nominal MERS officer, MERS has no actual authority to control the foreclosure or the legal actions undertaken in its name.
· MERS will never willingly reveal the identity of the owner of the promissory note unless ordered to do so by the court. Nor will the law firms who pretend to represent MERS.
· MERS will never willingly reveal the identity of the prior holders of the promissory note unless ordered to do so by the court. Nor will the law firms who pretend to represent MERS.
· Since the transfer in custody of the promissory note is not for consideration, this transfer of custody is not reflected in any contemporaneous accounting records. MERS does not hold any loans nor pay any legal fees to foreclose any loans. MERS is essentially a shell.
· MERS is never a holder in due course when the transfer of custody occurs after default.
· MERS is never the holder when the promissory note is shown to be lost or stolen.
· So-called “certifying officers” of MERS have submitted thousands if not tens of thousands of affidavits in Court proceedings falsely claiming that MERS was the holder of the promissory note or that the note had been lost.
· An increasing number of court’s have learned of the fast and loose practice of various foreclosure attorneys preparing and the submitting affidavits signed by “certifying officers” of MERS wherein the statements contained in these affidavits are “disingenuous and/or outright misrepresentations”
· Court’s which have actually scrutinized the statements contained in these certifying officer’s affidavits have determined that these affidavit statements were not admissible because they were signed by people who had no personal knowledge of the facts contained in the affidavits. They were therefore not competent to testify to the alleged facts.
· The Hon. Linda B. Riegle, U.S. Bankrutpcy Judge, recently took issue with several affidavits that had been filed in support of several Motions for Relief from Stay by attorneys purporting to represent MERS. Judge Riegle refused to accept the affidavits of people claiming to be “Certifying Officers of MERS” which were submitted by attorneys purporting to represent MERS in an attempt to feign standing by pretending to be a holder of notes. Hawkins 2009 WL 901766 (Bkrtcy-D.Nev. March 31, 2009) The Court found that the affiant’s were not competant to testify concerning the underlying loans. “Ms. Mech’s bald assertion that she has “reviewed the loan file” is inadequate to show that she is personally knowledgeable of the facts”.
· Similarly the Hon. Terry L. Meyers, U.S. Chief Bankruptcy Judge, recently rejected a post hearing submission of an affidavit sign by a lawyer purporting to represent MERS in motion to lift stay. Judge Meyers enumerated six (6) reasons that he was rejecting the affidavit which had been submitted in a last ditch attempt by legal counsel purporting to represent MERS to establish standing for MERS by claiming MERS was the holder of the underlying promissory note. Judge Meyers found the affidavit statements by counsel claiming to represent MERS was inadmissible because the lawyer as a witness was not competent to testify regarding various documents and a note the lawyer’s sworn statements “appeared to be based nit on the affiant’s (counsel) persoanl knowledge but on the assertions of someone else . . . . the proffer of this “new” note as the “original” note directly contradicts MERS’ prior representations that the Note attached to the Motion was true and correct and the operatice document in this matter”
MERS’ Role in Mortgage Servicing
· MERS does not service mortgage loans.
· MERS is not the owner of the servicing rights relating to the mortgage loan and MERS does not service loans.
· MERS does not collect mortgage payments.
· MERS does not hold escrow’s for taxes and insurance.
· MERS does not provide pr perform any servicing functions on mortgage loans, whatsoever.
· Those rights are typically held by the servicer of the loan, who may or may not also be the holder of the note.
MERS’ Rights To Control the Foreclosure
· MERS Corp. must all times comply with the instructions of the holder of the mortgage loan promissory notes.
· MERS Corp. only acts when directed to by its members and for the sole benefit of the owners and holders of the promissory notes secured by the mortgage instruments naming MERS as nominee owner.
· MERS Corp. members employ and pay the attorneys bringing foreclosure actions in MERS’ name.
MERS’ Access To or Control Over Records or Documents
· MERS has never maintained archival copies of any mortgage application for which it serves as “nominee”.
· In its regular course of business, MERS as a corporation does not maintain physical possession or custody of promissory notes, deeds of trust or other mortgage security instruments on behalf of its principals.
· MERS as a corporation has no archive or repository of the promissory notes secured by deeds of trust or other mortgage security instruments for which it serves as nominee.
· MERS as a corporation is not a custodian of the promissory notes secured by deeds of trust or other mortgage security instruments for which it serves as nominee.
· MERS as a corporation has no archive or repository of the deeds of trust or other mortgage security instruments for which it serves as nominee.
· In its regular course of business, MERS as a corporation does not routinely receive or archive copies of the promissory notes secured by the mortgage security instruments for which it serves as nominee.
· In its regular course of business, MERS as a corporation does not routinely receive or archive copies of the mortgage security instruments for which it serves as nominee.
· Copies of the instruments attached to MERS’ petitions or complaints do not come from MERS’ corporate files or archives.
· In its regular course of business, MERS as a corporation does not input the promissory note or mortgage security instrument ownership registration data for new mortgages for which it serves as nominee, but rather the registration information for such mortgages are entered by the “member” mortgage lenders, investors and/or servicers originating, purchasing, and/or selling such mortgages or mortgage servicing rights.
· MERS does not maintain a central corporate archive of demands, notices, claims, appointments, releases, assignments, or other files, documents and/or communications relating to collections efforts undertaken by MERS officers appointed by corporate resolution and acting under its authority.
Management and Supervision
· In preparing affidavits and certifications, nominal officers of MERS, including Vice Presidents and Assistant Secretaries, making representations under MERS’ authority and on MERS’ behalf, are not primarily relying upon books of account, documents, records or files within MERS’ corporate supervision, custody or control.
· Officers of MERS preparing affidavits and certifications, including Vice Presidents and Assistant Secretaries, and otherwise making representations under MERS’ authority and on MERS’ behalf, as a matter of routine do not furnish copies of these affidavits or certifications to MERS for corporate retention or archival.
· Officers of MERS preparing affidavits and certifications, including Vice Presidents and Assistant Secretaries, and otherwise making representations under MERS’ authority and on MERS’ behalf are not working under the supervision or direction of senior MERS officers or employees, but rather are supervised by personnel employed by mortgage investors or mortgage servicers.
This should be a pretty good start for those of you faced with a foreclosure in which MERS is falsely asserting that it is the owner of the promissory note. Whether MERS is or was ever the holder is a FACT QUESTION which can be determined only by ascertain the chain of custody of the promissory note. When the promissory note is lost, missing or stolen, MERS is NOT the holder.
If you are served with any lawsuit wherein MERS is named as the Plaintiff make sure you raise the issue that the lawyer or law firm who had signed the complaint is not actually representing MERS. Here are a series of preliminary Request for Admissions that should be served upon the lawyer of law firm who claims to be representing MERS as a Plaintiff in any lawsuit.
PLEASE TAKE NOTICE that Defendant John Doe in this case requires Plaintiff Bank of New York to admit or deny for the purpose of this case on the several facts hereunder specified within thirty (30) days as the time provided by Rules of Civil Procedure to admit or deny. Request for Admissions may include requests for admissions as to both factual and legal issues. Therefore you must admit or deny requests for both factual or legal admissions. The definitions contained in the Defendants’ Interrogatories are hereby incorporated as though fully restated herein.
REQUEST NO. 1: Mortgage Electronic Registration Systems Inc. (“MERS”) did not retain or authorize Dewy Cheatham and Howe P.A. (“Cheatham”) to commence the above entitled action against John Doe or any other defendant relating to the Subject Property.
REQUEST NO. 2: MERS did not provide any information to Cheatham used in drafting the allegations of the Complaint which Cheatham served and filed.
REQUEST NO. 3; MERS did not have any direct or indirect involvement in controlling any other aspect of the above entitled action against John Doe.
REQUEST NO. 4: MERS has no direct knowledge that Cheatham commenced the above entitled action against John Doe under the name of MERS.
REQUEST NO. 5: MERS has never verbally communicated with Cheatham with regard to the above entitled action during any stage of the action.
REQUEST NO. 6: MERS has never communicated with Cheatham in writing at any stage of the above entitled action that Cheatham has commenced against John Doe by simply naming MERS as the Plaintiff.
REQUEST NO. 7: MERS could not have authorized Cheatham to commence the above entitled action against John Doe or any other defendant relating to the Subject Property, because MERS has no pecuniary interest in the subject property and therefore has no standing and/or authority to sue John Doe.
REQUEST NO. 8: MERS has no legal or beneficial interest in the promissory note underlying the security instrument for which it serves as “nominee”.
REQUEST NO. 9: MERS has no legal or beneficial interest in the loan instrument underlying the security instrument for which it serves as “nominee”.
REQUEST NO. 10: MERS has no legal or beneficial interest in the mortgage indebtedness underlying the security instrument for which it serves as “nominee”.
REQUEST NO. 11: MERS has no interest at all in the promissory note evidencing the mortgage indebtedness.
REQUEST NO. 12: MERS is not a party to the alleged mortgage indebtedness underlying the security instrument for which it serves as “nominee”.
REQUEST NO. 13: MERS has no financial or other interest in whether or not a mortgage loan is repaid.
REQUEST NO. 14: MERS is not the owner of the promissory note secured by the mortgage and has no rights to the payments made by the debtor on such promissory note.
REQUEST NO. 15: MERS does not make or acquire promissory notes or debt instruments of any nature and therefore cannot be said to be acquiring mortgage loans.
REQUEST NO. 16: MERS has no interest in the notes secured by mortgages or the mortgage servicing rights related thereto.
REQUEST NO. 17: MERS does not acquire any interest (legal or beneficial) in the loan instrument (i.e., the promissory note or other debt instrument).
REQUEST NO. 18: MERS has no rights whatsoever to any payments made on account of such mortgage loans, to any servicing rights related to such mortgage loans, or to any mortgaged properties securing such mortgage loans.
REQUEST NO. 19: Mortgage indebtedness for which MERS serves as the serves as “nominee” is not reflected as an asset on MERS’ financial statements.
REQUEST NO. 20: Failure to collect the outstanding balance of a mortgage loan will not result in an accounting loss by MERS.
REQUEST NO. 21: When a foreclosure is completed, MERS never actually retains or enjoys the use of any of the proceeds from a sale of the foreclosed property, but rather would remit such proceeds to the true party at interest.
REQUEST NO. 22: MERS is not actually at risk as to the payment or nonpayment of the mortgages or deeds of trust for which it serves as “nominee”.
REQUEST NO. 23: MERS has no pecuniary interest in the promissory notes or the mortgage indebtedness for which it serves as “nominee”.
REQUEST NO. 24: MERS is not personally aggrieved by any alleged default of a promissory note for which it serves as “nominee”.
REQUEST NO. 25: There exists no real controversy between MERS and any mortgagor alleged to be in default including John Doe.
REQUEST NO. 26: MERS is never the holder of a promissory note in the ordinary course of business.
REQUEST NO. 27: MERS is not a custodian of promissory notes underlying the security instrument for which it serves as “nominee”.
REQUEST NO. 28: MERS does not even maintain copies of promissory notes underlying the security instrument for which it serves as “nominee”.
REQUEST NO. 29: MERS did not retain Cheatham or obligate itself in any way to pay any legal fees to Cheatham with regard to Cheatham commencing the above entitled action.
INTERROGATORIES
PLEASE TAKE NOTICE, that Plaintiff, Bank of New York, answer the following Interrogatories under oath within thirty (30) days from the date of service hereof, pursuant to Rule 33 of the ____________ Rules of Civil Procedure. These Interrogatories are to be deemed continuing so as to require prompt supplemental answers if additional information is obtained between the time Answers are served and the time of trial.
INSTRUCTIONS
A. Each Interrogatory is to be answered fully on the basis of information which is in your possession.
B. In each of your answers to these Interrogatories, you are requested to provide not only such information as is in your possession, but also information as is reasonably available. In the event that you are able to provide only part of the information called for by any particular Interrogatory, please provide all the information you are able to provide and state the reason for your inability to provide the remainder.
C. If you object to, or otherwise decline to answer, any portion of an Interrogatory, please provide all information called for by that portion of the interrogatory to which you do not object or to which you do not decline to answer. For those portions of an Interrogatory to which you object or decline to answer, state the reasons for such objection or declination.
D. Every Interrogatory herein shall be deemed a continuing Interrogatory and you are to supplement your answers promptly if and when you obtain relevant information in addition to, or in any way inconsistent with, your initial answer to such Interrogatory.
E. If any of the following Interrogatories can be answered fully and completely simply by referring to an exhibit number, page, and paragraph of the investigative file compiled by the Agency and furnished to the Appellant by the Agency in connection with this administrative complaint of discrimination, such references, if adequately identified to inform the Appellant as to your response, will serve as a satisfactory response to such Interrogatory.
DEFINITIONS
A. “Document” means any writing, record, notes, memorandums, correspondence, photographs, drawings, charts, tape or other voice recordings, or other graphic matter whether stored on paper, cards, computers or computer disk, magnetic or videotape, and shall include those which now are or ever were in the possession, custody, or control of Plaintiff.
B. “Communication” means any conveyance of meaning or information, by any mode or medium, including but not limited to, telephone, telegraph, facsimile, e-mail correspondence, and any written or spoken language between two or more persons.
C. “Identify” or “Identity,” with respect to a document, means (regardless of whether any claim or privilege is asserted), to set forth the following information, subject to the Option to Produce Business Records as provided by Rule 33.03, Minnesota Rules of Civil Procedure:
1. Its nature (e.g., letter, memorandum, report, etc.);
2. The date it bears or, if undated, the date it was written or created;
3. The identity of the person(s) who wrote or created it;
4. The identity of the person(s) who received it;
5. Its file number or other identifying mark or code;
6. Its substance; and
7. The identity of the person(s) in custody or control of it.
D. “Identify” or “Identity” with respect to a person, means to set forth the following information:
1. The person’s name;
2. Present or, if unknown, last home address;
3. Employer; and
4. Job title or occupation.
E. “Identify” or “Identity” with respect to a communication means the following information:
1. Date and place of occurrence;
2. Sender or initiator;
3. Recipient;
4. Identity of each person participating or present;
5. Medium or mode used; and
6. Its substance.
F. “Person” or “Persons” means any individual, firm, partnership, association, corporation or other entity.
G. “You” or “your” means the parties, individually and collectively, to whom this set of Interrogatories is addressed and their officers, employees or agents.
H. The “Subject Property” refers to the property that is the subject matter of the above entitled action located 1456 Humingbird Trail, Aviary Minnesota. .
I. “Plaintiff” refers to.”MERS” refers to the Mortgage Electronic Mortgage Registration Systems.
L. John Doe refers to Defendant John Doe
M. “Closing” refers to origination of a loan and/or or mortgage securing a loan to Paul Homes by and between America’s Wholesale Lender to Paul Holmes.
In answering these Interrogatories, the Plaintiff is requested to furnish not only such information as is available to the Plaintiff but also such information as is known to any of the Plaintiff’s agents, attorneys, and any other person or entity acting or purporting to act on behalf of the agency.
If any matter responsive to any of the interrogatories, the Plaintiff shall set forth completely the grounds for the asserted privilege. The Plaintiff shall identify as to each privileged communication or document:
its date;
its author(s);
the business title or position of its author(s);
its recipients(s);
the business title or position of its recipient(s);
it number of pages;
its subject matter;
the legal basis upon which the Plaintiff claims privilege;
the specific portion of the interrogatory or document to which the communication or document is responsive.
Each interrogatory and each part thereof is to be answered separately and fully. Immediately preceding your response to each of the following interrogatories, please set forth the full text of the question asked, followed by your response.
Documents are to be labeled to indicate the interrogatory to which they respond.
In order to simplify the issues and resolve as many matters of fact as possible before hearing, if, following a reasonable and thorough investigation using due diligence, you are unable to answer any interrogatory, or any part thereof, in full because sufficient information is not available to you, answer the interrogatory to the maximum extent possible, including any knowledge or belief you have concerning the unanswered portion thereof and the facts upon which such knowledge or belief is based. In addition, state what you did to locate the missing information and why that information is not available to you.
When an exact answer to an interrogatory is not known, state the best estimate available, state that it is an estimate, and state the basis for such estimate.
If documents once in your possession or under your control are requested or are the subject of an interrogatory, and such documents are no longer in your possession or under your control, state when such documents were most recently in your possession or under your control, and what disposition was made of them, including identification of the person now in possession of or exercising control over such documents. If the documents were destroyed, state when and where they were destroyed, and identify the person or persons who directed their destruction.
All of the following interrogatories shall be continuing in nature until the date of the hearing, and you must supplement your answers as additional information becomes known or available to you.
NOTE:
IF YOU CONSIDER ANY INTERROGATORY OR REQUEST FOR PRODUCTION OBJECTIONABLE, PLEASE CALL THE UNDERSIGNED BEFORE OBJECTING, IN ORDER TO ATTEMPT TO NARROW THE QUESTION OR AVOID THE OBJECTIONABLE PORTION OR ASPECT.
INTERROGATORY NO. 1: State the name, address, employment position, and relationship to Plaintiffs of the persons providing information and/or assisting in the preparation of the Petition filed in the above-entitled proceeding.
INTERROGATORY NO. 2: State the name, address, employment position, and relationship to Plaintiffs of the persons providing information and/or assisting in the preparation of the answers to the admissions previously served, these interrogatories and the request for production of documents.
INTERROGATORY NO. 3: Identify every person with knowledge of any of the facts alleged in the Complaint by Plaintiffs, and for each such person state in detail the facts that such person has or claims to have.
INTERROGATORY NO. 4: Identify every person or entity who has or who had possession, custody or control of any documents identified in Plaintiffs’ answers to these Interrogatories or in Requests for Production of Documents served on you contemporaneously herewith, and for each such person identify the documents the person has or claims to have and the date they came into such person’s possession.
INTERROGATORY NO. 5: State the names, addresses and telephone numbers, employment positions, and relationship to the parties of any person from whom you have obtained statements or reports concerning the above entitled matter and give the dates on which such respective statements and/or reports were obtained.
INTERROGATORY NO. 6: Identify all witnesses you intend to call at trial of this matter, and give a summary of the object matter of the testimony of each of them.
INTERROGATORY NO. 7: Identify all document(s) you intend to introduce as Exhibits at trial of this matter and/or documents upon which you relied in making the eighty eight allegations in your Complaint. .
INTERROGATORY NO. 8: As to any of the above Request for Admissions
which you do not unqualifiedly admit, state:
(a) Each fact upon which you base your denial.
(b) Identify each person who you assert has knowledge of each such fact.
(c) Identify each document, record or item upon which you base your denial,
INTERROGATORY NO. 9: Identify and list each letter communication, notice or other written communication relating to the Subject Property by and between the Plaintiff and any of the following persons and/or entities:
(a) John Doe.
(b) John No One.
(c) Richard Dewey.
(d) Frank Cheatham.
(e) Andy Howe.
(f) Lender XYZ.
INTERROGATORY NO. 10: Identify the specific person or persons from MERS who authorized Cheatham to commence of the above entitled action.
INTERROGATORY NO. 11:. Identify in whose possession the Promissory Note given by John Doe to ______________ Lender was at the time Cheatham commecned the above entitled action against John Doe to foreclose the mortgage.
INTERROGATORY NO. 12: Identify and describe what, if any, lenders title insurance policy may have been issued to MERS with regard to the mortgage which MERS is attemtpin to foreclose by the instant action.
INTERROGATORY NO. 13: Identify and Describe in detail the factual and legal basis supporting any of the allegations in the MERS Complaint, and identify all supporting documents and all persons having personal knowledge of said allegations.
INTERROGATORY NO. 14: Explain why MERS is suing John Doe to foreclose a mortgage that allegedly secures a debt evidenced by a promissory note held by someone other than MERS.
INTERROGATORY NO. 15: Identify who was the holder of the underlying promissory note which is MERS alleges is in default by its Complaint in the above entitled action.
INTERROGATORY NO. 16: Identify and describe in detail the factual and legal basis for any and all claims MERS is asserting in this action, and identify all supporting documents and all persons having personal knowledge of said basis.
INTERROGATORY NO. 17:. Identify and describe any and all communications by and between MERS and Defendant John Doe prior to commencing the action to foreclose the mortgage in which MERS is named as a “nomineee”. .
INTERROGATORY NO. 18: Identify the date when MERS retained Cheatham and authorized Cheatham to commence the above entitled action against John Doe.
INTERROGATORY NO. 19: Identify and describe what, if any, communication MERS has had with Cheatham since the above entitled action was commenced against John Doe.
INTERROGATORY NO. 20: Identify what, if any, obligation MERS has to pay Cheatham legal fees relating to legal services provided by Cheatham with regard to the above entitled action that Cheatham has commenced on behalf of MERS against John Doe. .
INTERROGATORY NO. 21: Identify what, if any, other person and/or entity is contractually obligated to pay Cheatham legal fees to legal services provided by Cheatham with regard to the above entitled action that Cheatham commenced on behalf of MERS against John Doe.
. REQUEST FO DOCUMENTS.
It is hereby demanded, in accordance with Rules 34.02 and 26.02(3) of the Minnesota Rules of Civil Procedure, that you produce and allow inspection and copying, or furnish copies to the undersigned, of the following documents (please categorize your responses.
REQUEST NO. 1: All documents disclosed and/or identified in your responses to Respondent’s Request for Admission or Interrogatories herein.
REQUEST NO. 2: All documents utilized or referred to in preparing your responses to Respondent’s Request for Admission or Interrogatories herein.
REQUEST NO. 3: All documents which in any way relate to the claims and/or allegations made in the complaint filed by Cheatham purportedly on behalf of MERS in the above entitled action.
REQUEST NO. 4 All correspondence by and between any Defendants and any person or entity with regard to the subject mortgage loan. .
REQUEST NO. 5: Any and all closing statements, title insurance policies and/or any other written evidences from the closing of the loan made by _____________ Lender to John Doe. .
REQUEST NO. 6: The Original promissory note from John Doe to _____________ Lender.
REQUEST NO. 7: Any and all accounting ledger which was maintained by _____________ Lender or subsequent holders of the John Doe’s promissory note which records payments of principal and interest and/or penalties made by John Doe on the indebtedness that MERS alleges he owes under the promissory note given to ___________ Lender.
REQUEST NO. 8: Any and all documents, ledgers, or other accounting records that were used as a basis for MERS’ to determine a default was made by John Doe under the promissory note he allegedly gave to _______________ Lender.
REQUEST NO. 9: Any and all documents, ledgers, or other accounting records that were used as a basis for the calculation of amounts MERS claims is due and owing by John Doe under the promissory note he allegedly gave to _________________ upon which MERS has commenced an action for foreclose the MERS mortgage it claims to have been assigned.
REQUEST NO. 10: Any and all evidence of MERS legal status as Delaware corporation, legally entitling MERS to commence a legal action in Minnesota without registering as a foreign corporation.
REQUEST NO. 11: Any and all written communication by or from the MERS directing or authorizing the law firm of Cheatham to file a lis pendens and/or to commence the above entitled action on behalf of MERS.
CLEARANCE DARROW ATTORNEY AT LAW
Dated: _____________ . ________________________________
Clearance Darrow Attorney No. 1
Attorney for John Doe
123 Expose MERS Road
Foreclosure, MN 55117
Telephone:
I sincerely hope that dissemination of the aforementioned information concerning MERS will help educate and inform all Americans, including lawyers, judges, legal scholars and perhaps even the mainstream media as to just what MERS is and more importantly what it is not. I am hoping that this information will dispel any misconceptions that MERS is a mortgage lender, a creditor or the holder of any promissory note. Accordingly MERS, or more correctly, lawyers claiming to represent MERS are commencing legal actions in MERS name when in fact MERS has no pecuniary interest in the underlying debt and therefore has absolutely no standing to bring any legal action which is based upon an indebtedness that is owed to someone other than MRS.
Lastly it appears that most suits that have been brought on behalf of MERS are lawyer initiated with no authorization, control or involvement from MERS. Legal fees for these MERS suits are never paid for by the MERS, but are paid either by the actual lender or creditor or the servicer of the loan who may of may not be holding the original promissory note. Foreclosure lawyers and law firms scattered around the country have been able initiate tens of thousands foreclosure actions, and eviction actions under the name of MERS because until recently most people thought MERS was a creditor, lender or servicer with standing to foreclose and officers who could testify as to the underlying loan. The many recent decisions dismissing MERS actions for lack of standing and court’s taking issue with affidavits submitted in conjunction with these pretended and unauthorized suits indicates a growing awareness of the MERS ruse.
REQUEST FOR INFORMATION:
If you have any information regarding recent legal actions commenced by MERS and/or Bank of New York or recent court decisions wherein MERS and/or Bank of New York were named as Plaintiff’s please email the information to me for review and inclusion in my ever growing dossier.
Kevin Lamson
kevin_lamson@yahoo.com
Sir:
Everyone would appreciate if you could please add the citations of each case together with the headings.
Thanks.
Could you forward me a copy of this caseKelley v. Upshaw, 39 Cal. 2d 179, 192, 246 P.2d 23 (1952), I can’t find it in its entirety anywhere, and I am Pro-per in a case against LaSalle Bank and Wilshire here in California.
Jason The Same thing happend with me.It’s the way the MERS system is setup any employee of a member mortgage company can become certified mers officers or some thing like that.Let me guess it didn’t bear a signiture or corp. seal on it from SBMC? Same with me only it was fremont & litton. Neil My only 2 questions are how did they get recorded & can they be invalidated?
Jason: send letters to all concerned about what you have discovered. Send complaint to Banking Commission and make sure you name individuals, with copies to the companies involved. If necessary file quiet title action alleging what you have written here.
I have a civil case against WAMU right now. My Original lender was SBMC which closed their doors in December of 2007. WAMU filed an Assignment of Trustee form that was signed by a MERS officer and signed as “MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC. AS NOMINEE FOR SBMC MORTGAGE.” Now at this time SBMC Mortgage had already closed its doors and the person signing did so as a Vice President of “MERS” and named SBMC on the document in order to get it filed in the State of California and to make it look like it was coming from SBMC, however it turns out that she is an employee of WAMU!
Dan,
I did the audit on Hillery.
Yes. I only meant it from the standpoint that “lenders” rely on the recorded copy to “prove” you owe the debt and the debt is valid. But, copies don’t prove anything. I was not referring to anything else – or saying that everything recorded is worthless.
Thanks,
Dan Edstrom
dmedstrom@hotmail.com
Dan (2-11-09, 5:55 PM): “What is recorded with the county does not make any difference.” – Actually, it could make a difference, in this way: Most county clerks are actually part of the state’s court system. If a “Lender” or servicer has recorded an assignment without authorization from the true holder in due course of the Note, then it is a fraudulent assignment. If the fraudulent assignment is recorded with the county clerk (state court system) and especially if attached to a foreclosure case (in a judicial state), then the recording of that assignment also constitutes a fraud upon the court.
Can someone please post this case in pdf format. Or advise on where to obtain. Thank you
Area’s top judge cracks down on foreclosure mills
By DUANE MARSTELLER – dmarsteller@bradenton.com
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MANATEE — The area’s top judge has lost patience with so-called foreclosure mills so he’s ordering them to appear in court.
Non-local law firms that specialize in mass foreclosure filings have ignored local court procedures, filed incomplete or inaccurate court documents and “widely abused” the privilege of appearing at court hearings by telephone, 12th Judicial Circuit Chief Judge Lee Haworth said.
He’s cracking down, requiring lawyers in foreclosure cases filed in Manatee, Sarasota and DeSoto counties to attend all foreclosure-related hearings in person.
Haworth
*
Administrative order issued re: Foreclosure Hearings
* Search 2007 Manatee County foreclosures
* Interactive Map: 2007 Foreclosures in Manatee County
“We feel it’s a strong way to impress upon them the importance of following our rules,” he said Tuesday of his order, which takes effect March 9. “This is the only way we know how to get their attention, by forcing them to spend more money and touching their bottom line.”
Haworth said he expects non-local firms to comply by hiring local attorneys to appear on their behalf.
Lawyers who represent borrowers in foreclosure cases hailed Haworth’s move, saying it will hold lenders’ attorneys accountable for following court procedures.
“It’s a great thing,” said Dawn Bates-Buchanan, Gulfcoast Legal Services’ managing attorney. “I’m ecstatic.”
While the order affects all lawyers in foreclosure cases within the district, it’s pointed directly at so-called foreclosure mills that file the bulk of local cases.
Those firms’ heavy workloads often result in incomplete court files and missed court hearings, causing delays and wasting court resources, Haworth said. For example, Manatee County Circuit Judge Paul Logan could hold only five of 79 foreclosure hearings one day last week because of attorney unavailability and incomplete or inaccurate paperwork.
Those firms also have not substantially complied with new procedures for foreclosure cases despite early and repeated notices, Haworth said.
He declined to name the firms that have drawn his ire. But court records show the biggest filers of foreclosure actions in Manatee include Florida Default Law Group in Tampa; the David J. Stern law firm in Plantation; and the Marshall C. Watson law firm in Fort Lauderdale.
Michael J. Echevarria, Florida Default’s managing partner, did not return telephone messages Tuesday.
Stern’s practice also did not return phone calls.
Watson did not respond to an e-mail seeking comment, and a woman who answered the firm’s phone said the firm does not speak to the media.
The order is Haworth’s latest effort to help the judicial system handle the crush of foreclosures, which have risen 628 percent in the last three years.
In December, he decreed that foreclosure suits must be filed electronically and that attorneys must file all relevant documents when scheduling a foreclosure hearing.
Haworth also began requiring lenders’ attorneys, when filing a foreclosure suit, to invite the homeowner to a “conciliation conference” to discuss possible alternatives to foreclosure, such as restructuring the loan, modifying payments or arranging a short sale.
Haworth said he and his office began notifying lawyers of those changes as early as mid-October, logging each and every contact. But the early notice hasn’t led to widespread compliance, he said.
“They knew this was going to happen,” he said of foreclosure mills. “There’s no way they can say they didn’t know about it.”
Duane Marsteller, transportation/growth and development reporter, can be reached at 745-7080, ext. 2630.
In many cases the lender has failed to record the deed of trust and its subsequent transfers. This past Friday two families in MD got their mortgages invalidated due to recording issues.
We are currently doing land records bring downs on all the cases.
http://abcnews.go.com/TheLaw/Economy/Story?id=6855179&page=2
few choice bits:
“The FBI has more than 530 open corporate fraud investigations, including 38 corporate fraud and financial institution matters directly related to the current financial crisis,” Pistole told the Senate Judiciary Committee today.”
he 38 companies, he said, “are significantly large companies, businesses everyone knows about but I cannot comment publicly.”
Pistole’s comments suggested widespread criminal activity among many of the nation’s corporate giants.
“These are significantly large, similar to Enron,” Pistole said. The number of firms under scrutiny could eventually top 100, as the investigations widen, he said.
The above ruling for bankruptcy in California was based on a 1980 law. In 1999 it was updated . Quote from teh Law and Practice of Secured Transactions by Richard F. Duncan and William H. Lyons:
“Under the new priority rules, however, a secured party that perfects a security interest in instruments by filing will prevail over a trustee in bankruptcy but will not automatically prevail over one in possession of the instrument. U.C.C. Rev. 9-312, 9-330 (1999).”
Dan Edstrom
dmedstrom@hotmail.com
I forgot – and left out the best part.
The court said it doesn’t matter what is recorded with the county. If the lender does not have possession of the instrument (or an agent or bailee), the instrument has not been perfected.
“Had the legislature intended to allow perfection by methods proposed by appellants, they could have done so.”
Dan’s synopsis:
What is recorded with the county does not make any difference. If the lender is not in possession of original instrument – too bad for the lender.
Dan Edstrom
dmedstrom@hotmail.com
The above from NY is Florida law.
Here is some California law:
http://bulk.resource.org/courts.gov/c/F2/625/625.F2d.281.78-2755.html
STARE DECISIS – Lat. “to stand by that which is decided.” The principal that the precedent decisions are to be followed by the courts.
Dan’s synopsis (Dan is not an attorney and would love to hear an attorney’s interpretation of this case):
Notes were secured by a Deed of Trust. The lender had possession of the note but not the Deed of Trust. The lender relied on the Deed of Trust recorded with the county. The notes were not perfected (I assume because the lender was not in possession of the Deed of Trust).
While this case does not involve real estate, I think it may apply real estate (instruments).
It appears (to me) in this case that borrowers admitted the note and Deed of Trust exist but lender cannot enforce unperfected security instruments.
If you are an attorney (especially in California), please discuss your thoughts.
Excerpts:
– The bankruptcy court determined that notes secured by the deeds of trust were unperfected security interests under the California Uniform Commercial Code § 9304(1).
– If a court determines, in litigation between P(laintiff) and D(efendent), that the applicable rule of law is that certain security interests are instruments, and they were not perfected, then this ruling is the “law of the case” for the P(laintiff) and D(efendent) litigation. See, 1B Moore’s Federal Practice P .401 (2d Ed. 1974).
Dan Edstrom
dmedstrom@hotmail.com
Chapter 701 ASSIGNMENT AND CANCELLATION OF MORTGAGES
701.02 Assignment not effectual against creditors unless recorded and indicated in title of document; applicability.–
(1) An assignment of a mortgage upon real property or of any interest therein, is not good or effectual in law or equity, against creditors or subsequent purchasers, for a valuable consideration, and without notice, unless the assignment is contained in a document that, in its title, indicates an assignment of mortgage and is recorded according to law.
(2) This section also applies to assignments of mortgages resulting from transfers of all or any part or parts of the debt, note or notes secured by mortgage, and none of same is effectual in law or in equity against creditors or subsequent purchasers for a valuable consideration without notice, unless a duly executed assignment be recorded according to law.
(3) Any assignment of a mortgage, duly executed and recorded according to law, purporting to assign the principal of the mortgage debt or the unpaid balance of such principal, shall, as against subsequent purchasers and creditors for value and without notice, be held and deemed to assign any and all accrued and unpaid interest secured by such mortgage, unless such interest is specifically and affirmatively reserved in such an assignment by the assignor, and a reservation of such interest or any part thereof may not be implied.
(4) Notwithstanding subsections (1), (2), and (3) governing the assignment of mortgages, chapters 670-680 of the Uniform Commercial Code of this state govern the attachment and perfection of a security interest in a mortgage upon real property and in a promissory note or other right to payment or performance secured by that mortgage. The assignment of such a mortgage need not be recorded under this section for purposes of attachment or perfection of a security interest in the mortgage under the Uniform Commercial Code.
(5) Notwithstanding subsection (4), a creditor or subsequent purchaser of real property or any interest therein, for valuable consideration and without notice, is entitled to rely on a full or partial release, discharge, consent, joinder, subordination, satisfaction, or assignment of a mortgage upon such property made by the mortgagee of record, without regard to the filing of any Uniform Commercial Code financing statement that purports to perfect a security interest in the mortgage or in a promissory note or other right to payment or performance secured by the mortgage, and the filing of any such financing statement does not constitute notice for the purposes of this section. For the purposes of this subsection, the term “mortgagee of record” means the person named as the mortgagee in the recorded mortgage or, if an assignment of the mortgage has been recorded in accordance with this section, the term “mortgagee of record” means the assignee named in the recorded assignment.
This is great!!! Im so excited because this case is has most of the same parties that we are currently fighting right now in my father’s case. We are right behind them, look out for a victory soon from us with deutsche bank national trust and Saxon, and many more to come from all of you out there fighting this great fight!