Kansas S Ct Decision Annotation 2: Reversing Default

The point must be made, and the evidence must be allowed, that the pretender lenders are gaming the system every day and literally stealing homes from both homeowners and investors who thought they had an interest in those homes when they bought mortgage backed securities. This leaves the borrower in a position of financial double jeopardy wherein the true owner of the loan can still make a claim and the investor is simply out of luck — usually have been misinformed about the payments or status of the pool of assets the investor bought into.

From Landmark v Kesler — see entire decision: kansas-supreme-court-sets-precedent-key-decision-confirming-livinglies-strategies

“6. It is appropriate for a trial court to consider evidence beyond the bare pleadings to determine whether it should set aside a default judgment. In a motion to set aside default, a trial court should consider a variety of factors to determine whether the defendant or would-be defendant had a meritorious defense, and the burden of establishing a meritorious defense rests with the moving party.
7. Relief under K.S.A. 60-255(b) is appropriate only upon a showing that if relief is granted the outcome of the suit may be different than if the entry of default or the default judgment is allowed to stand; the showing should underscore the potential injustice of allowing the case to be disposed of by default. In most cases the court will require the party in default to demonstrate a meritorious defense to the action as a prerequisite to vacating the default entry or judgment. The nature and extent of the showing that will be necessary lie within the trial court’s discretion.”

A highly important finding in this decision and affecting those whose homes have already been subject to a foreclosure sale, judgment or eviction (unlawful detainer) proceeding. In most cases these proceedings have resulted in actions taken by the parties upon the default of the alleged borrower. The default occurs when the borrower fails to answer in a judicial state or fails to file a lawsuit in a non-judicial state. The first time the matter comes before a court is when the foreclosing party files something in court — like an eviction action or petition for writ of possession. The mistake that courts are making at the trial court level is that they are treating the matter as though it has been judicially concluded, as if there was a hearing or trial where the parties were heard on the merits. This is simply not the case.

Judges must come to the realization that this is not the end of the matter — it is the beginning. And they should consider any motion directed to the merits of the would-be forecloser’s claim and the defenses of the homeowner. And unlike a motion to dismiss, where there will be plenty of time to consider factual matters later, the motion to set aside the sale, foreclosure judgment, notice of default, notice of sale, or judgment of unlawful detainer or eviction is a final determination of the merits — most often without hearing one shred of evidence offered or proffered by the homeowner. In fact, there are numerous cases where the trial judge abruptly and even rudely silenced the lawyer or pro se litigant saying that this was a simple matter of eviction (or whatever the motion was pending) and this is not an evidentiary hearing. Other Judges see the inherent unfairness and the denial of due process when the homeowner raises objections that the pretender lender had no right to foreclose, did so improperly and essentially stole the title abusing state process and creating a fraud upon the court and everyone else. But the application of this approach has been inconsistent and uneven.

While we have seen numerous cases turned on their head where a homeowner has been restored to possession of the house, and even clear title awarded to the homeowner thus blocking any future foreclosure, we have seen many other cases where Judges are still viewing these cases as dead beat borrowers trying to game the system.

The point must be made, and the evidence must be allowed, that the pretender lenders are gaming the system every day and literally stealing homes from both homeowners and investors who thought they had an interest in those homes when they bought mortgage backed securities. This leaves the borrower in a position of financial double jeopardy wherein the true owner of the loan can still make a claim and the investor is simply out of luck — usually have been misinformed about the payments or status of the pool of assets the investor bought into.

“How do I prove that?” is the usual question. You don’t prove it you ask it. After performing a forensic review, hopefully by an independent expert, you present allegations and evidence that upon the best information you have, you believe the loan was securitized and that the owner of the loan is not the party who brought the action. You offer further your belief that the loan might have been paid or transferred by reason of federal bailout or insurance or credit default swaps, and that this pretender lender refuses to answer the questions put to them in the qualified written request and debt validation letter.

Since the QWR and DVL are statutory letters giving rise to an obligation to answer and resolve the issue, and the pretender lender is already in violation, the only answer the pretender lender could have to avoid sanction for failing to conform to statute is to say they are not a lender and therefore they don’t have any obligation to answer. This of course knocks them out of the position of would-be forecloser. If the pretender lender simply fails to comply, then your position is that no creditor can seek to collect on a debt without proving the debt is due. Since you have asked for a full accounting of the chain of title on the loan and the money received from all parties, not just the borrower, it is impossible to state how much of the obligation is due and to whom it is owed.

Thus the answer is that you allege the facts, you present probable cause (forensic review) for your allegations and then enter the discovery phase in which you press the pretender lender into eventually taking the position that they don’t need care, custody or control over the note or loan. They will take the position that they have the bare right to enforce the note and mortgage with or without the proper documentation. Most judges won’t buy that.

By the way, a simple and deadly question to ask the pretender lender in litigation is whether they have complete decision-making authority to modify the loan. You’ll be killing several birds with one stone when answer or refuse to answer that question — especially in California where there is an obligation on the part of the lender to have a modification program in place. The current programs in place are from servicers, not lenders.

7 Responses

  1. A quick question guys. I friend of mine in St Pete FL waited to long to file an written response to his foreclosure, and has had a summary judgement filed. There has not been a sale yet. With the new Kansas ruling is there something he can file to get back in the game?

    John Anderson

  2. Hi everyone. I am the author of the above “Open Letter to President Obama.”

    I am positive about the Wells Fargo / Cheronda Guyton matter taking place in Malibu; and that the property was even referred to as “Malibu Colony properties.” (Unfortunately, I’m not a good proofreader, nor, thanks to mortgage fraud, can I afford one.) I am aware that real estate agent Irene Dazaan-Palmer wanted show the lender-reclaimed Malibu property of Lawrence and Linda Elins. I simply mistyped the word Miami instead of Malibu, and never even realized I had done so.

    However, I feel certain it is clear to any reader that the identities as well as the incident about which I wrote were in fact the people in Malibu.

    ALSO, I am not a lawyer, I am simply someone who uses her time, money, and resources to do what I can to help people to whom blogs such as these are intended. If typos are more interesting than any information I share, please ignore my submissions. Again, thanks for calling attention to my Miami / Malibu error. -Barbara

  3. Just for the record on the WF Exec Cheronda Guyton, the event took place in >>Malibu, CA<< and not Miami. The PUBLIC STORY is below.

    However I do think there is a certain fish smell to the whole thing.

    Why would an "Exec" of 17 years risk her career doing something stupid like that?


    MALIBU, Calif. — Wells Fargo & Co. has fired an executive who reportedly partied and stayed at a bank-owned $12 million beach house in the exclusive Malibu Colony, the bank said Monday.

    Bank spokeswoman Jennifer Langan confirmed that Cheronda Guyton, a senior vice president, was the only employee involved in the alleged violation of company policy.

    "We deeply regret the activities that have taken place as they do not reflect the conduct we expect of our team members," the bank said in a statement.

    No phone listings could be located for Guyton.

    The previous homeowners, Lawrence and Linda Elins, turned over the 3,800-square-foot house to Wells Fargo in May. Their real estate agent said they were financially devastated by Bernard Madoff's fraud scheme and had to sign the property over to Wells Fargo to help pay a larger debt.

    The home was not foreclosed and the bank agreed not to immediately sell it, Langan said.

    Neighbors told the Los Angeles Times they saw Guyton's family at the house and that it was used for at least one party where guests were ferried from a yacht.

    Read more at: http://www.huffingtonpost.com/2009/09/14/cheronda-guyton-wells-far_n_286682.html


    re: Disregarding Blatant Proof of Wells Fargo’s Egregious Deceptive Practices Could Result In A Worse-Than-Madoff Situation

    Mr. President:

    PLEASE launch probes into self-evident false IRS form 1099-A’s connected with foreclosures.

    A mere look at Wells Fargo’s false 1099-A’s will expose various White Collar real estate & foreclosure fraud (carried out for years)–likely, another S&L mess! Further, the most recent controversy about former Wells Fargo (WF) senior vice president, Cheronda Guyton’s use of the Miami home which the owners lost as a result of Bernie Madoff, is actually an unwitting exposition of deceits associated with foreclosure and repossessions. Moreover, Wells Fargo’s internal investigation into that Miami matter has glaring appearances of coverup –particularly because WF implausibly announced Ms. Guyton acted solely when it fired only her.

    The point I want to make is that non-legal foreclosures filed DELIBERATELY in courtrooms are for reasons such as: filing false Internal Revenue form 1099-A’s for tax advantages; repeated property flipping (which leads to blighted neighborhoods); and Bankruptcy Court false motions to “Lift Stay” for purposes of achieving SIMULATED AUCTIONS. As such, loan modification is not in the interest of these sort of lenders. Ongoing news reports of court judges who dismiss foreclosure cases because of no proof of owning notes is not always a coincidence, or mistake.

    Deliberately false foreclosures often name defunct mortgage companies or companies which no longer hold the notes, and contain illegally affixed fees in excess of “Acceleration Clauses,” which makes it even harder for people to re-pay arrears. If property owners sue for “Unfair Debt Collection Practices,” attorneys make more even $$$ through protracted litigations –which Wall Street Investors often incur the tab. In some instances, through use of a false mortgage holder’s name, the debt collection lawyer actually is the disguised foreclosing plaintiff who wounds up with ownership of foreclosed property and flips it!

    The reality is that SCORES of foreclosure cases -including some of Wells Fargo’s have been thrown out of court when lenders (via collection lawyers) file foreclosure or Bankruptcy court proceedings without proof of being the proper party in interest. Accordingly, as it pertains to the minuscule information supplied by WF after embarrassment by its former vice president squatting and partying in the Miami home; and in light of irrefutable foreclosure frauds, here are some blatant questions about foreclosures, as well as that home squatting incident for which Wells Fargo dismissed our intelligent ability to contemplate:

    1. Undeniably, the Elin property had not yet been put on the market for public sale. How or why then, did ––according Ms. Guyton’s public statement– Collin Equities wind up owning that Miami home after the Elins signed it property over to Wells Fargo?

    2. Could it be that (in like manner as Wells Fargo does here in Louisiana) Collin Equities was the straw buyer for the Elins property, or did some sort of “simulated sale” occur whereby the property deed became (unlawfully) CONVEYED to Collin?

    3. Considering Guyton’s brass to use that Miami home, and her reference to Collin Equities, could there have been kickbacks / quid pro quo activity between them or any other firm of which Guyton oversaw property ownership transfers?

    4. Since Ms. Guyton was “responsible for commercial foreclosed properties,” wouldn’t it be the role of the person who is in charge of Residential foreclosed properties to permit Guyton to have access to the Elin property? On the other hand, if the property is under Collin Equities ownership, did Collin permit Guyton’s personal use of that home?

    5. If Guyton had no authority over residences such as the Elin home, but Guyton’s authority was commercial property, does that not demonstrate that Wells Fargo’s investigation was not truthful; and that persons in the residential properties department were actually tangled with Guyton’s actions?

    6. What percentage of reasonable thinking people can honestly believe that WF employees do not make personal use of other repossessed properties as long as no exposure and public outrage occurs?

    7. How many people are unlawfully homeless, unlawfully evicted due to null foreclosure filings, or due to Bankruptcy Court “Lift Stay” motions that have been filed in the name of a lender which does not own the note, or a defunct lender?

    8. If courtroom judges simply give collection attorneys carte blanche approval to seize and sell [defaulted] property without judges bothering to determine whether the named mortgage company has lawful right to the property, how probable is it for an unscrupulous lawyer to use any company’s name to seize someone’s home?

    9. How many lawyers (via straw buyers) wind up with those distressed properties until they flip them!?

    10. When mortgage companies receive form 1099-A tax advantages from the Internal Revenue; and when mortgage companies continually flip property while at the same time gain negotiable security for the same property, what incentive is there for such lenders to bother about blighted neighborhoods?

    11. Lastly, aside from the gust of foreclosures that were dismissed from courts, what untold numbers of people who lack legal knowledge or lack means to pay for legal representation have lost or will loose their homes unlawfully?

    The seriousness of the above information is more than ample reasons why I respectfully ask you, Mr. President, to compel Congress to conduct a massive investigation of Wells Fargo (which will shed much light on many aspects of lender frauds), and refrain from blindly accepting Wells Fargo’s own spin of the truth. Please feel free to make use of the facts, court pleadings, transcripts, and other prima facie evidence posted on my website. Moreover, there is more available evidence I have not made public of which, I will be pleased to provide when my safety is certain. Here are 2 links from my website:



    Barbara Ann Jackson
    Law & Grace, Inc

  5. Thank you Mr. Garfield. That piece was to the point, and useful.

  6. […] may have given millions of distressed homeowners the legal wedge they need to avoid foreclosure. In Landmark National Bank v. Kesler, 2009 Kan. LEXIS 834, the Kansas Supreme Court held that a nominee company called MERS has no right […]

  7. Here’s a recent case “on-point” with the GA Appeals Court giving an “out” that needs to be PLED BEFORE you act on the eviction. YOU MUST SET ASIDE THE FORECLOSURE BY : Setting aside the FORECLOSURE “AND” DEED!!!

    This case INVITES your claims of fraudulent and forged deeds that nullify the foreclosure as unlawful since the party foreclosing did not have legal title in the property or ownership of the note.

    Next, GA has two great provisions in state law as follows:

    Title 24, Chapter 4, Section 23 (24-4-23)
    In the ordinary course of business, when good faith requires an answer, it is the duty of the party receiving a letter from another to answer within a reasonable time. Otherwise he is presumed to admit the propriety of the acts mentioned in the letter of his correspondent and to adopt them


    Title 24, Chapter 3, Section 36 (24-3-36)
    Acquiescence or silence, when the circumstances require an answer, a denial, or other conduct, may amount to an admission.

    My theory and opinion is that if you send dispute of debt letter, QWR, TILA and a demand to ID your lender and who owns your note and where it is in custody and you question specific transactions AND GET NO ANSWER OR RESPONSE TO QUESTIONS, these two law could be used to create fact issues and you can seek a lawsuit and injunction to stop a foreclosure OR TO SET ASIDE A FORECLOSURE after the fact.

    Owens v. Green Tree Servicing LLC, A09A1666 (Ga. App. 9/2/2009) (Ga. App., 2009)
    Page 1

    Court of Appeals of Georgia.
    Decided: September 2, 2009
    BLACKBURN, Presiding Judge.

    In this dispossessory action, Terrence Owens appeals first from the court’s issuance of a writ of dispossession, arguing that the landowner Green Tree Servicing LLC wrongfully foreclosed on the property. We affirm in this case on two grounds: such is not a valid defense to a dispossessory action, and Owens failed to include a transcript of the trial, precluding our review of his claim of error. Owens’s second appeal is from the court’s order requiring him to pay rent pending the appeal. In light of our disposition of the first appeal, this second appeal is moot and is therefore dismissed.

    The undisputed facts show that on March 9, 2009, Green Tree filed a dispossessory warrant against Owens and other occupants of a residence, asserting that they were all tenants at sufferance as a result of Green Tree’s obtaining the property through a recent foreclosure sale. See Cal. Fed. Savings & Loan Assn. v. Day1 (the former owner, “by remaining in possession of the premises after a lawful foreclosure of his deed to secure debt, became a tenant at sufferance and subject to summary dispossession by appellant, the purchaser at the foreclosure sale”). Green Tree sought dispossession only. Owens answered, claiming that because of a pending bankruptcy by a co-debtor and because of notice defects, the foreclosure was wrongful, and that therefore no writ of dispossession should issue. After a trial on the merits, the trial court issued a writ of dispossession on March 26, 2009, which writ Owens appeals in Case No. A09A1666. On April 27, 2009, Green Tree moved the court to require Owens under OCGA § 44-7-56 to pay rent into the registry of the court pending the appeal (if he wished to remain in possession of the premises); the court entered such an order, which Owens appeals in Case No. A09A1978.

    Case No. A09A1666
    1. In his appeal of the writ of dispossession, Owens contends that the trial court erred in rejecting his defense of wrongful foreclosure that asserted the bankruptcy of a co-debtor and other alleged defects in the foreclosure process. This contention fails for at least two reasons.

    First, “[a] challenge to the validity of foreclosure in defense of a dispossessory proceeding will not lie, because, after a foreclosure sale, the former owner cannot attack dispossession without first setting aside the foreclosure and deed.” Hurt v. Norwest Mortgage, Inc.2 See Solomon v. Norwest Mortgage Corp.3 (“after foreclosure sale, the former owner cannot attack dispossession without first setting aside the foreclosure and deed”) (punctuation omitted); Hague v. Kennedy4 (“[c]laimed defects in the landlord’s title to premises cannot be raised as a defense to a proceeding for possession . . .”) (punctuation omitted).

    Second, even if Owens’s defenses were available in a dispossessory proceeding, we cannot review the same because Owens failed to include a trial transcript in the record. Indeed, Owens specifically stated in his notice of appeal that “[t]here is no trial transcript in this case.” Yet determination of the “wrongful foreclosure” issue asserted by Owens on appeal (based on an alleged bankruptcy by a co-debtor and alleged notice defects in the foreclosure) would require us to review the evidence submitted at trial.

    [Owens], however, failed to file a transcript of the proceedings and apparently did not attempt to reconstruct the transcript as allowed by OCGA § 5-6-41 (g) and (i). When a transcript of the evidence is necessary, as it is here, and the appellant omits it from the record or fails to submit a statutorily authorized substitute, we must assume that the evidence supported the grant of a writ of possession. As the appellant[, Owens] had the burden to affirmatively show error by the record. This [he] failed to do. Therefore, we must presume the trial court’s judgment granting [Green Tree] a writ of possession is correct.

    (Punctuation omitted.) Harden v. Young.5 We have specifically so held in cases challenging a foreclosure as wrongful, whether because of a bankruptcy stay or otherwise. See, e.g., Miley v. Thornburg Mortgage Home Loans;6 Olubajo v. Deutsche Bank Nat. Trust Co.;7 Wimbley v. Washington Mut. Bank;8 Parks v. Tex. Commerce Bank.9

    Case No. A09A1978
    2. The second appeal is from the trial court’s ruling ordering Owens to pay rent pending appeal, if he wished to remain in possession of the premises. Citing Carter v. Landel/Arundel, Inc.10 and Wall v. T. J. B. Svcs.,11 Green Tree claims that Owens was required to file an interlocutory application to have this appeal heard. However, in both of those cases, the appeal was from an order directing the tenant to pay rent pending the disposition of the dispossessory case; in neither had the trial court decided the question of possession, thus making the appeal from the order to pay rent premature (absent compliance with interlocutory appeal procedures).

    Here, however, the trial court had already decided the sole issue of dispossession, leaving nothing to be decided when the court entered the post-judgment order requiring the payment of rent pending appeal. Similar to a post-judgment order requiring the posting of a supersedeas bond, a post-judgment order requiring the payment of rent pending appeal is subject to direct appeal, as there is nothing left to be decided in the trial court. See OCGA § 5-6-34 (a) (1). Cf. Rapps v. Cooke12 (direct appeal of post-judgment order requiring supersedeas bond); Robenolt v. Chrysler Financial Svcs. Corp.13 (direct appeal of post-judgment order to pay rent pending appeal).

    3. Owens argues that the trial court lacked the authority to order him to pay rent pending appeal. Beyond the fact that such is expressly authorized by OCGA § 44-7-56, we hold that in light of our disposition of the dispossessory appeal, the question is moot in any case. See Ruskin v. AAF-McQuay, Inc.14 (“as the [main] appeal . . . has been decided, the matter of the bond is moot”). Accordingly, this second appeal is dismissed as moot. See Almonte v. West Ashley Toyota.15

    Judgment affirmed in Case No. A09A1666, and appeal dismissed as moot in Case No. A09A1978. Adams and Doyle, JJ., concur.



    1. Cal. Fed. Savings & Loan Assn. v. Day, 193 Ga. App. 690, 691 (388 SE2d 727) (1989).

    2. Hurt v. Norwest Mortgage, Inc., 260 Ga. App. 651, 659 (2) (i) (580 SE2d 580) (2003).

    3. Solomon v. Norwest Mortgage Corp., 245 Ga. App. 875, 876 (1) (538 SE2d 783) (2000).

    4. Hague v. Kennedy, 205 Ga. App. 586, 588 (423 SE2d 283) (1992).

    5. Harden v. Young, 268 Ga. App. 619, 620 (606 SE2d 6) (2004).

    6. Miley v. Thornburg Mortgage Loans, 294 Ga. App. 140, 141 (668 SE2d 560) (2008).

    7. Olubajo v. Deutsche Bank Nat. Trust Co., 280 Ga. App. 154 (633 SE2d 543) (2006).

    8. Wimbley v. Washington Mut. Bank, 271 Ga. App. 477, 478 (610 SE2d 124) (2005).

    9. Parks v. Tex. Commerce Bank, 229 Ga. App. 467, 468 (494 SE2d 276) (1997).

    10. Carter v. Landel/Arundel, Inc., 172 Ga. App. 115, 116 (3) (322 SE2d 108) (1984).

    11. Wall v. T. J. B. Svcs., 141 Ga. App. 437 (233 SE2d 810) (1977).

    12. Rapps v. Cooke, 234 Ga. App. 131, 134 (2) (505 SE2d 566) (1998).

    13. Robenolt v. Chrysler Financial Svcs. Corp., 201 Ga. App. 168, 170 (4) (410 SE2d 365) (1991).

    14. Ruskin v. AAF-McQuay, Inc., 284 Ga. App. 49, 53 (643 SE2d 333) (2007).

    15. Almonte v. West Ashley Toyota, 281 Ga. App. 808, 810 (637 SE2d 755) (2006).

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