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Darrell Blomberg is a presenter at our kickoff of the national tour of seminars starting July 26, 2012 in Chandler, AZ. He is NOT a lawyer but in my opinion has a better understanding of the law, its application and the context of the fake securitized loans than practically any else I know. He is completely correct in his analysis of the Hogan decision below.

I strongly advise homeowners who are near the Chandler location, to go find a lawyer and or contact the one they already have and PAY for the lawyer to attend the seminar and maybe pay for their own attendance as well. Paralegal add-ons are available as well.

Editor’s Note:

Darrell is 100% right that this decision poses a mammoth shadow problem for those people who are working for “Trustees” and conducting sales, sending notices of default and sending notices of sale. Issuing a deed on foreclosure to a party who who was the creditor but submitted a credit bid instead of a cash bid is only one issue. The fact is that if the Trustee becomes aware of a bona fide dispute between the alleged beneficiary or creditor and the borrower the Trustee has only ONE CHOICE: They must petition the court for a ruling because the Trustee does not have the power to conduct hearings. It IS that simple.

The reason they are not doing that and the reason why there is a substitution of trustee filed in every case is that the original trustee WOULD do that and would conduct due diligence, which the banks cannot afford because they know they don’t have the goods — they are not the creditor and in many cases even the the real original creditor is no longer present because of the trading activity and recompilation of the pools with different assets, loans and even using other derivatives as assets. 

These facts will all come out when the burden is put on the supposed creditor to show the transaction in which they paid real money for the loan. No such transaction exists. So they cannot submit a credit bid and probably don’t have the authority to initiate foreclosure proceedings. The potential liability of the Trustees that were substituted and perhaps even the original trustees is staggering when applied to prior foreclosures. When it becomes clear that the new trustee is appointed by a stranger to the transaction calling itself the beneficiary when it is not the beneficiary and new trustee is owned or controlled by the new “beneficiary.”

By Darrell Blomberg, July 11, 2012:

The Supreme Court of Arizona released their amended opinion this morning.  I have attached it for you or here is the link:  The essential changes were confined to section 11.

First off, I offer HUGE KUDOS and THANKS to all the extraordinary people who contributed to the effort of getting this all the way to the Supremes and then back into their court for a well-earned reconsideration.

The challenge with Hogan was that the questions were never optimally framed and Hogan didn’t make the record with sufficient allegations and assertions.  His pleadings left too many escape hatches open.  (No slight to anybody; the questions didn’t appear until long after the best-for-the-day questions were put forth.)  I’m amazed at “amount” of decision we got from the Supremes considering those challenges.

I believe the new “Moreover, the trustee owes the trustor a duty to comply with the obligations created by the statutes governing trustee sales and the trust deed.” language is very beneficial to homeowners and attorneys.  I think this is vastly better than the prior decision and gives us a lot more umph.  This is a clear statement of the court tying “duty” together with “statutes governing trustee’s sales and the trust deed.”  I can’t remember something so elemental and so important happening for us at any administrative, judicial or legislative level.  Tying duty to the statutes and contract was always sketchy but this decision does it succinctly and boldly.

This is precisely what all of my “Cancellation Demand Letters” have been geared to convey.  This decision will certainly be added to every “Cancellation Demand Letter” from now on.

Don’t forget this amended language:”A.R.S. § 33-801(10) (providing that “[t]he trustee’s obligations . . . are as specified in this chapter [and] in the trust deed”).”  It’s sure to be used against our efforts.  I think this can be well mitigated by the Consumer Financial Protection Bureau bulletin 2012-03 which tied the servicer (beneficiary?) and the sub-servicer (trustee?) together for liability purposes.  Perhaps it doesn’t reign in the trustees so much but it sure raises the temperature on the beneficiary.  With the right amount of pressure on the beneficiary maybe they’ll heat up the trustee for us.  (See attached or this link:

For the record, here is the language that was removed from the original opinion: “Moreover, the trustee owes the trustor a fiduciary duty, and may be held liable for conducting a trustee’s sale when the trustor is not in default.”

My commercial:  If you know anybody that is in need of an all-out analysis of the Arizona Trustee’s Sale process that I turn into a letter for the homeowner, please let me know.  My letters are a great way to make the record and maybe even cancel a few notices of trustee’s sales along the way.  (Contact info is below.)

For further consideration, here is Black’s 6th on “Duty.”

Duty. A human action which is exactly conformable to the laws which require us to obey them. Legal or moral obligation. An obligation that one has by law or con­tract. Obligation to conform to legal standard of reason­able conduct in light of apparent risk. Karrar v. Barry County Road Com’n, 127 Mich.App. 821, 339 N.W.2d 653, 657. Obligatory conduct or service. Mandatory obligation to perform. Huey v. King, 220 Tenn. 189, 415 S.W.2d 136. An obligation, recognized by the law, re­quiring actor to conform to certain standard of conduct for protection of others against unreasonable risks. Samson v. Saginaw Professional Bldg., Inc., 44 Mich. App. 658, 205 N.W.2d 833, 835. See also Legal duty;Obligation.

Those obligations of performance, care, or observance which rest upon a person in an official or fiduciary capacity; as the duty of an executor, trustee, manager, etc.

In negligence cases term may be defined as an obli­gation, to which law will give recognition and effect, to comport to a particular standard of conduct toward another, and the duty is invariably the same, one must conform to legal standard of reasonable conduct in light of apparent risk. Merluzzi v. Larson, 96 Nev. 409, 610 P.2d 739, 741. The word”duty” is used throughout the Restatement of Torts to denote the fact that the actor is required to conduct himself in a particular manner at the risk that if he does not do so he becomes subject to liability to another to whom the duty is owed for any injury sustained by such other, of which that actor’s conduct is a legal cause. Restatement, Second, Torts § 4. See Care; Due care.

In its use in jurisprudence, this word is the correlative of right. Thus, wherever there exists a right in any person, there also rests a corresponding duty upon some other person or upon all persons generally.

Duty to act. Obligation to take some action to prevent harm to another and for failure of which there may or may not be liability in tort depending upon the circum­stances and the relationship of the parties to each other.





36 Responses

  1. […] Read more… Posted in AZ, Banks, MERS, News Around The Country, States « Registers of Deeds in Five NC Counties Take Issue with Fannie and Freddie’s Tax Exempt Status “A day of reckoning may soon be coming.” Yves Smith » You can leave a response, or trackback from your own site. […]

  2. @jim – five stars!

  3. @tnharry, yes, mtn to stike. That’s the ticket – thanks. This was the first time I had seen the inclusion of a late doc mtn’d to be part of the complaint: annoying (and you’ll know why), but effective, I guess, unless one can fashion a sustainable mtn to strike. Most of us aren’t there yet. Hopefully ‘yet’ is somewhat operative.

  4. @jg – one could file a motion to strike the exhibit and cite whatever basis upon which you believe it to be inadmissible

  5. From a Weidner post today:

    “On appeal, Cerron argues that the circuit court erred in granting summary judgment when GMAC failed to refute his affirmative defenses. Based on our de novo review of the summary judgment, we agree. See Taylor v. Bayview Loan Servicing,
    LLC, 74 So. 3d 1115, 1117 (Fla. 2d DCA 2011) (“The standard of review on a summary judgment is de novo.”). The party moving for summary judgment must show that there are no disputed issues of material fact and (note the and – sic) that it is entitled to judgment as a matter of law. Id. at 1116-17 (citing Fla. R. Civ. P. 1.150(c)). In addition, a plaintiff moving for summary judgment must refute the nonmoving party’s affirmative defenses. Id.; see
    also Coral Wood Page, Inc. v. GRE Coral Wood, LP, 71 So. 3d 251, 253 (Fla. 2d DCA2011).”

    Cerron had articulated 7 affirmative defenses in his response to the complaint. GMAC, as stated, failed to refute (and I’m gonna hazard that means prove against) his affirmative defenses. The grant of GMAC’s mtn for summary judgment was overturned. Affirmative defenses are regulated by Fed Rule of Civl Procedure 8 (there’s a mirror state court rule; I just don’t know it). Summary judgment may not be granted when aff defenses have not been overcome. The case must proceed on the merits, which should include discovery. “There is no trial without discovery”. I note that GMAC filed a deal and attached a doc as a supplement to its complaint. We care because attachments to a complaint are part of the complaint – in fact, they rule over what’s alleged in the complaint. What is the correct response to such an alleged supplement for a litigant who opposes the supplement? Anyone know, oh, and also will tell, even anonymously?

  6. @dw – what jd are you in? Are you appealing a state court decision or a dc decision?

  7. Playing nicely with others will get you farther than demoralizing them with unrequested criticism anyday. I object to tn’s constant negativety, not the occasional nugget he espews related to procedure or statute; however, like anything offered without having been solicited, it’s up to you guys to decide what it’s worth. Psychopathy or not, when you decide, consider the source. We don’t have to play with him. I skip over his comments and find life serene and positive. I do enjoy a good lambasting by eTolle, the benevolent billy goat who keeps him inline,
    I must admit tho. Humor in response to Hubris–classic!

  8. “¶7 Hogan’s complaints do not affirmatively allege that
    WaMu and Deutsche Bank are not the holders of the notes in
    question or that they otherwise lack authority to enforce the

    Moral of this story – in states where presentation of the note is not required, start with denying all claims of and debts to the pretender lenders and their servicers.

    The judges are clearly intimating (imho) that Hogan’s position and claims would have been stronger and have more merit if he had done so.

  9. @hkcon – thumbs up!

  10. @DebWynn

    Thank you.

  11. Las Vegas.
    Answer I believe so. Obviously I’m not an attorney all I can tell you is from my desperate efforts pro se – check with the rule book and land laws of your state. I placed my lis pendens in the land records after I filed the lawsuit the reason is to notice all that there is a question of rights regarding the subject property, mine outlined the causes of action/ reasons why I was placing a lis pendens, it’s a valid move when you are the trustor. you have a right to protect your life liberty and property
    yes. Now if as in my case there was a reverse repo and the home was taken by a non party per se and the court allowed the lifting of Lis pendens and
    Then quiets title in HSBC name. Well I a few bones to pick about that. Will Keep you posted or look on my docket. Civ 2009 01587 JAT
    It’s a mess procedurally but tells a story and is public info – What I did wrong learn from,
    please. I am in appeals. Not over yet.

  12. @tnharry

    Thank you.

  13. yes

  14. I have a question:

    If a property owner is in lawsuit against servicer, should a lis pendens be filed against property? Thank you in advance.

  15. I think that the fact that tn does not believe that massive fraud has taken place speaks for itself. I do not post much on here as I am no where near as smart as most of you. That being said, I wish you guys would just ignore him instead of engaging him which seems to be what he enjoys most. I know we are all frustrated but to lower ourselves to namecalling and such is very damaging to the spirit.

  16. PS – re # 3 – could it be that Hogan didn’t object to the assignment, including its alleged inclusion of the note?

  17. fwiw, one clue as to whether or not the AZ SC narrowed its ruling is in something I think I remember correctly. Before you object to a mtn for relief from stay in bk, for instance, you need to file an obj to the Proof of Claim or you can include it in the obj to the mtn, I think. Some courts have held a homeowner to the fire for omitting the obj to the poc.
    But we’d have to read the pleadings to see what Hogan said and didnt’ say. Somewhere here seems to think arguments were made that the court didn’t appear to think were made.

  18. Well, that hurt, just like i knew it would. Help me out here, please, if you can.
    1. The AZ SC says Hogan didn’t assert that the banksters weren’t entitled to enforce the note. Puhlease. Even if he didn’t, it is an argument which logically follows his literal assertions.

    2. AZ SC says ARS’s don’t require production of the original note.
    Yeah, but in Fed court, Rule 1002 can. Actually, what they said was ARS’s don’t require prod of orig note PRIOR to the trustee
    COMMENCING non-j f/c. Are those key words?

    3. Hold on to your hat. The AZ SC said the assgt from JPMC assigned the NOTE and deed of trust to Deutsche, as in, this assgt of the note was accomplished in the assgt of the dot. And I’m wondering what JPMC had to convey in the 1st place to anyone and at this date.

    4. AZ SC says ARS’s anti-deficiency statutes will protect Hogan from the claim of a noteholder in the future! Quelle blage! Now, I’m no
    authority on anti-def’s, but as I get it, some states preclude a banskter from going after a deficiency from the borrower if the sale of the collateral does not satisfy the debt when the bankster has chosen to foreclosure non-judicially. The DEBT is not satisfied here at all, for one thing, your honors. But, let’s just say the borrower owes 200k on the note and the home post f/c sale brings 200k net.
    What has that got to do with the claim of a noteholder? As I understand it, not a damm thing. The note is still outstanding and not impacted by the anti-deficiency law whatsoever, certainly if the party who owns the note did not foreclose.

    re: #2 above, AZ SC opines that if the ben were compelled to produce the note (and again, this is Before commencement of an act of f/c, which could just be the NOD), we’d pretty much be back at
    judicial f/c with the poor lenders incurring the time and cost of judicial foreclosure, which non-j was meant to preclude. Errr, how’s that, exactly?! Trust me – this invites discussion.
    But, yes, non-j was indeed intended to preclude the time and cost of judicial f/c. But imo what the AZ SC overlooked in its entirety, among some other things, is that getting non-j foreclosure was a stinking PRIVILEGE granted to lenders by the introduction of a third party to the collateral instrument, the dot trustee. We’ve already discussed his duties. *Apparently the AZ SC disagrees, relying solely on ARS 33- 801 to 33-821, which are NOT the only laws and considerations in play here imo. The duty and or fiduciary imposed as a matter of law on one in a position of trust is found in other areas of the law. You won’t find the contractual common law duties of good faiith and fair dealing in those specific statutes, either. And as Blomberg pointed out, the dot trustee is not empowered (certainly not expressly) to
    resolve disputes. Now, what is that saying? It’s saying like it or not, for the lack of that resolution power, the dot trustee must look to a court. They can have their stinking non-j f/c I guess if no one sqwauks, but sqwauking imo is a game changer.

    *I haven’t read Hogan’s pleadings, nor the Amicus to know what issues were raised, so I can’t know if the AZ SC purposefully narrowed its decisions to the specific issues brought before it. Maybe they did.

  19. You know, now that I think about it some more, if the law in your jurisdiction doesn’t recognize the fid between borrower and dot trustee (but don’t forget failure of good faith and fair dealing), but some jerkies are messing with him and so you, you can still allege “torteous interference with contract” against the jerky; think that’s what it could be called. Believe me, it is NOT okay with the law for one to interfere in your contractual rights or the trustee’s true duty.

    Next good question has to be how one state’s that a trustee has neglected his fiduciary or duty of good faith and fair dealing. And that’s the gazillion dollar question. If an assgt of the deed of trust to
    someone has been recorded, is that the end of the story, is that all the trustee need rely on to come after you? Well, that may take some time to develop because of course that assgt is not the bomb, not even close. Regardless, if one has made a dispute known to the trustee or another party in the act, those matters of dispute can be noticed if not preserved in public record for starters.

  20. I hate it when I have to re-write something! I suppose everyone does.
    Take two (comp ate the first one), something like this:
    Oh, for Pete’s sake. The dot trustee has a fiduciary to the dot borrower or a duty of good faith and fair dealing or BOTH. Jurisdictions are split on the fiduciary of a dot trustee. The duty of ‘good faith and fair dealing’ are tenets arising in contract, probably ANY contract and there is NOthing new about this and it isn’t rocket science, despite the ridiculous lag in asserting fiduciary or good faith and fair dealing against the dot trustee. There is NO fiduciary from a servicer to a borrower, but as far as I know, despite the absence of a contract between a stinking servicer and a borrower (because there isn’t one), the servicer still owes the borrower the truth and whether or not that rises to a duty of good faith and fair dealing, I don’t know. Seems like it would. If not, it’s just got another name I don’t know this minute: servicers don’t get to just lie to homeowners as if it’s not some tort / wrong or another.

    Now, there’s this other thing at law and it’s called “third party breach of fiduciary”. That’s when a third party, not the trustee or one in the position of fiduciary, encourages the fiduciary / trustee to breach his fiduciary to the other party. In this instance, that ‘other party’ can be either the borrower or the true beneficiary, or both. Breach of fiduciary is actionable, that is, it is itself a cause of action, as is third party breach of fiduciary. Third party breach of fiduciary is sometimes called ‘aiding and abetting breach of fiduciary”, but I think in these cases, third party breach is the more approp term (or both, I don’t know for sure) when some gangbankster encourages a dot trustee to act outside the trustee’s authorization, that is, to act on the order of
    someone with no authority to order the trustee to act, i.e., foreclose or anything to do with foreclosure. There was a granddaddy third party breach case in around, or I found it, around 2008 with “Green” in the name, but longer name than “Green”, in its title which was quite lengthy in its discussion of third party breach. Unfortunately, I lost it in a computer crash and haven’t been able to find it again. Anyone got it? At any rate, all these schmoes who are getting the trustee to act with no right to do so, are in fact committing third party breach of fiduciary. If there is no fiduciary in your jurisdiction between the dot trustee and the borrower, than the borrower can’t be the one to allege the third party breach, but one may bring an action on failure of good faith and fair dealing. I guess if I were in doubt after researching, I would allege both (in good faith, of course, your honor, did I allege breach of fid).

    So what’s different here with breach of fiduciary or gf & fd? The difference is including the trustee in a suit or filing a separate one against him for either or both: breach of fiduciary and or failure to exercise good faith and fair dealing with the borrower. Now Blomberg, below, opines it’s that simple based on ‘duty’ of the trustee. The trustee when noticed of your disputes must bring a court action for resolution, says he. Well, yeah, right, that’s happening. So far as I know, the borrower can do one or two things about the trustee’s failure to do so: bring suit as indicated herein and or file the Notice with the public recorder in your county. IF you file suit against the trustee (or anyone involved) THEN you have a patent right to file a lis pendens should you choose. IM lay opinion. But I would file the Notice first.
    And btw, though it does not innur to the benefit of the borrower (that I know of), the sec’n trustee likely has a fiduciary to the investors whether he likes it or not because generally, the law imposes a fiduciary on one in a position of trust. Agents similarly have a fiduciary duty to their principals, a duty MERS, for instance, tried to avoid by the use of the word “nominee”.
    Now I guess I’ll break down and read Hogan. Yawn and probably grrrrrr….

  21. I don’t know how this could be of benefit but I don’t recall it ever being discussed. Shell Companies. This link explains it.

    After reading about shell companies check out the Delaware division of corps.

    All the lenders and MERS are registered there. Why?

    The entity states classed as ‘ A-general ‘ meaning non profit or religious. Why?

  22. @ Neil: this opinion looks like the paid judges used every opportunity to stick it to Hogan. Just that the judges write Hogan didn’t say this or that doesn’t mean Hogan didn’t. Many such opinions are as phony & fraudulent as the robo-signed forgeries they try to adjudicate. But in fact the court and the robo-signers are paddling in the same boat!!!…

  23. more talk on evidence , proof and how to get into evidence , please, and thank you john gault.
    the procedural dance we must dance to the non banks tune- and they are well prepared and cock sure to boot so lets change the tune- theres the art of law- i have chunky crayons but im getting better every day, as for baby seals whys that worth several mentions already, yes tn is a silly bugger, he has a pop at everyone. develop thick skin it will serve well over the next decade or so.

  24. @tolle – when’s the last time you had anything substantive to say? you revel in attacking me at every opportunity. how about the duties of a trustee as discussed in this article or the fraud complaint filed against MERS in yesterday’s post and whether the elements of fraud were adequately pled? you’d rather discuss my baby seal clubbing hobby and the color of jumpsuit I’ll wear someday. carry on sheeple…

  25. There is a huge divide between name calling and calling someone out. In order to be a foreclosing attorney frequenting a message board who offers very little in the way of constructive know-how, one would have to be a sociopath. Glib, lacking in any sense of moral responsibility or social conscience, that’s tnharry. His attitude of “we can supply the note when we have to” shows the arrogance of one who knows full well the underlying criminality involved with that statement, yet revels in the disturbing antisocial ramifications of those actions. It’s a game to him, and was a home to his victims. He rationalizes it in his mind by trying to convince one and all that he only does in-house – portfolio – non-securitized foreclosures. Now that’s priceless! I’m surprised he’s not advertising bridges for sale as well.

  26. @Nora—we are “entertainment” to him…he said so himself…he “plays” with us…nice, huh?

  27. Legal training emphasizes the ability to consider all positions in a controversy

    The venom on this site is disturbing. A la the political parties, instead of poking holes in Tns sallies, most of you insult him. That’s pretty dumb, especially as you won’t be able to resort to name calling for long in court

    Listen listen to all arguments. Unless all you really want to do is VENT

  28. NG said…..”if the Trustee becomes aware of a bona fide dispute between the alleged beneficiary or creditor and the borrower, the Trustee has only ONE CHOICE: They must petition the court for a ruling because the Trustee does not have the power to conduct hearings….”
    Haven’t read past that (thrilled to see it, actually), but that is right-on imo. I was talking about recording a doc called “Notice” while still in title, and a communication or articulation of what one has communicated to a dot trustee (or anyone) regarding a dispute could be included in such a Notice. Such Notice gives the world notice of the dispute and imo will prevent anyone from claiming as bona-fide purchaser without notice, for one thing. And as I’ve also opined, title companies likely will not insure over your objections. They will be noted in the “Trustee’s Sale Guarantee”, a thing issued by a title company prior to foreclosure and includes all docs of public record (or is supposed to and any omission is at the peril of the title co.) The TSG is mol a look at the state of the title to the real property. The “notice” of recordation is called “constructive notice “; notice directly communicated to a dot trustee (or anyone) is call “actual notice” and both are in play here. Still looking for the sample “Notice” around here somewhere.

    If you only tell the dot trustee and don’t Notice your dispute, then the wholly avoidable argument may be on as to the extent and value of your communication to the trustee (or anyone), I’d say.
    Now if your home were already foreclosed, but you had communicated your dispute(s) to the trustee or anyone else, can you now record a notice of those issues? I don’t know. Wish I did.
    As always, I’m not an attorney, and this isn’t legal advice.

  29. One has to wonder…why is tnhairy here? Does he revel in our injury, or rally against it? Does he believe he is providing some sort of (free) service along with his diatribe? Is he looking for hapless clients, or just killing time until the baby seals come back from their afternoon swim?

  30. @ Elaine, tnharry can’t help it, it’s not really his fault. It’s impossible to rise above the tainted mindset of one who is constantly scheming to part families from their homes. Degenerate actions practiced day in and day out can’t help but create a matching decay of spirit. Gollum! Gollum! Tnharry’s fate awaits us all if we let go of civility and take up the rally cry of greed and hubris that abounds in his world.

  31. @elaine – perhaps. or maybe i couldn’t find any baby seals to club today. either way, I’m not seeing the significance of this case or the amended opinion. i’m sure Neil and Darrell see something that I’m missing, but how many others are missing it as well? either this is supposed to be an educational and informative venture, or it’s a tease of what can be taught for a fee. i’m just saying he should be intellectually honest about it.

  32. tnharry, are you always this dour?

  33. seems like a long way to go to try to salvage a “win” from the opinion. was Arizona is a posture judicially prior to this decision that the trustee DIDN’T have to comply with the statutes and the Deed of Trust? surely not.

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