Supreme Ct Bond Decision: Standing and Cause of Action Closely Related



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Bond v United States

This case could turn out to be important, although the opinion is enshrouded with innuendo. It involves some hair splitting that is a replica of what is happening in foreclosure litigation. This case navigates through the various decisions of the Supreme Court and other Courts to arrive at a position that Plaintiff DID have standing because her cause of actiona rose out of the matter being allegedly used against her.

The important part of this case which sort of invokes the term “prudential standing” and acknowledges that standing is jurisdictional, is that the Court states outright that standing and possessing a cause of action are very closely related. In fact, the court acknowledges, the terms are and probably interchangeable. Why does that mean anything? Because the Supreme Court has given us the language of our argument.

Standing is jurisdictional, which means that if you can’t pass the threshold of invoking the Court’s jurisdiction you can’t say anything or do anything. Thus if a pretender wanted to foreclose, and they lacked standing to bring a judicial foreclosure, they would equally lack standing to invoke nonjudicial sale. To say otherwise would be to argue that non-judicial sale was intended by the legislature to circumvent the jurisdiction of the Courts. Once in the Courts, either through BKR petition or through Petition for TRO, the pretender has no greater standing (than they had before you sued them) just because you brought them in, providing that you are ONLY challenging the right of the pretender to invoke nonjudicial sale. If you are suing that party for other reasons, they have standing to defend, which is essentially what this Court decision means.

So your argument is that the pretender lacks standing to bring a judicial foreclosure because it lacks a cause of action — i.e., it has no loss or injury, and it isn’t the party in interest. A Motion for Realignment of Parties (look it up) is probably a good thing to do in these cases. Because your “case” is merely a denial of the allegations that the pretender WOULD make if they brought a judicial foreclosure. Most people forget that every state that has a provision for nonjudicial foreclosure still maintains its statutes for foreclosure through the courts (judicial.) Why? Because of cases just like these “securitized” loans. Where the facts are muddled, there is no choice but to convert the non-judicial proceeding into a judicial one. By realigning the parties, the Court says to the party seeking affirmative relief (to foreclose on a house) plead and prove your case as the Plaintiff and says to the borrower defend the case that is stated by the would-be forecloser.

So the would-be forecloser would have to state that the money is owed to them and nobody else or else they must state on whose behalf they are bringing the foreclosure and then plead the rat the other entity is the one to whom the money is owed. They must also plead that the ultimate creditor that is identified has not been paid, not just that the borrower didn’t pay it. If there is no injury there is no case, and the case for foreclosure would be dismissed on both jurisdictional (standing) grounds and the inability  to state a cause of action upon which relief could be granted.

5 Responses

  1. […] Supreme Ct Bond Decision: Standing and Cause of Action Closely Related […]

  2. What is implication if any for nonjudicial AND post “foreclosure” challenges. Probably doesn’t provide any help I would guess.

    Seems as though once the pretender does a quick sale, everything is legitimized, notwithstanding idle, seeming academic hopes about clouds on title. With a nod to Ibanez of course (did it provoke much litigation by ousted homeowners. I haven’t heard)

  3. Reading the case, but here’s what i have so far:

    “…non-judicial sale was intended by the legislature to circumvent the jurisdiction of the Courts…” Umm, yeah, that’s exactly the point.

    go into court and challenge it if you want to fight, but non-judicial is intended to circumvent the courts. going into court invokes the courts and gives you a chance to defend.

  4. I for one cannot wait to hear what tnharry says about this one…

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