Fagan Strikes Again: CA Judge Connects failure to Comply With Discovery with Right to Foreclose

Editor’s note: One of the tricks in civil procedure that has gone over the heads of some Judges is that the banks and servicers are refusing to comply with discovery, and while their refusal is subject to a later hearing they proceed with the foreclosure because there is no TRO.

In this case, Judge Tarle understood the connection immediately. While normally the Court is fairly liberal in giving parties time to respond to discovery, he also understood that this could open a window of opportunity for them to foreclose making the case moot for all intents and purposes. So he wrote in his order the same thing that a Judge would right in granting a TRO and prevented them from taking any action on the loan until the issues of discovery was resolved.

see Fagan – 7.27.12 Minute Order Re Ex Parte Hearing

I’ve asked the leading attorneys for banks that are not involved in the securitization illusion. They all respond the same way:

Q; You are the attorney for a bank, right?

A: Yes

Q: And as such you are required to file foreclosure actions on borrowers who can’t pay, right?

A: Yes if the board orders it, which is only after attempts have been made to do a workout.

Q: If you were met with challenges as to whether you funded the loan, owned the loan or had it as an account receivable would you delay discovery?

A: Absolutely not. I would immediately comply with the discovery, produce affidavits from witnesses and copies of our books and records showing the funding of the loan and our continuous ownership of the loan.

Q: If your bank said we have the note but we don’t have this loan as a loan receivable because it is owed to someone else, would you tell them to foreclose?

A: Absolutely not, unless they foreclosed in the name of the real owner of the obligation where the trail of assignments leads to that real creditor.

Q: At the auction of the property, if you were asked to submit a credit bid for the bank you are representing, you would ordinarily submit it in the name of that bank, right?

A: Yes

Q: But if you were only representing the bank who had documented authority to foreclose on behalf of another lender, on whose behalf would you submit the credit bid?

A: Obviously the real creditor, That is what the statute says. You pay cash unless you are the actual creditor to whom the money is owed and the note is collateralized by the property.

 

35 Responses

  1. Uh huh. Public Records don’t lie. Long line of homeowners praising how expert testimony helped too.

  2. Well, here I go again. If you file an emergency mtn as I described, some judges won’t grant the hearing on an emerg basis. They make you set it on a regular basis and by then -poof!- your house is gone and you is very prejudiced, imo. In fact, your action is mooted, I would think.
    Does anyone know if the refusal to set on emergency basis is appealable as interlocutory(?) and if so, what is the standard of review? I really think we need to know these answers. The answers could save homes. You still have to get your original motion granted, and now you’ve got a judge you might have gotten overturned, but what are you going to do? I say again, we need to know these answers.
    These are the usual lay opinions and not legal advice.

  3. @enraged at 7:42: a big hmmmmm…..plus I had never heard this before.

  4. @dcbingo – just caught your querry. But I’m pretty dang confused here. You have an attorney? What does he/she say, for peteys sake?

    In my totally layperson opinion, you can’t just propound discovery requests on your opponent. Did your lawyer file a discovery plan and get it approved? Does your lawyer agree you’ve got the goods for a dismissal in your favor? But, it sounds like you’ve already filed an answer, maybe with cross-allegations incognito

  5. beatenpath@inbox.com

    Is that the right url? I can’t seem able to access it…

  6. 23 wins Jeffers 23 to date . Headed to the 9th circuit and next stop —-stay tuned

  7. Barry Fagan v Wells Fargo Bank Re: Request for Production of Documents Set One SC117023

    This person does not exist -Shill

  8. 4 years of posting “information” that doesn’t work in Courts might be the reason

  9. why are you moderating me. Do you want me to go through yet another party to publish . What is your problem guys. Tell me . What is your deal .

  10. I’ve seen quite a bit you see. I have seen things both in and out of court. Over 25 years of secondary and capital markets trading.
    What doesn’t make sense is the following;

    1) Just another random case up north and 2 years after the engagement the attorney writes the court the night before withdrawing from the case. Counsel went as far as suggesting her client was in the home far to long and she would not represent her any longer.
    2) This was just another foreclosure possession / ejectment case and what was the lawyers redact all about?
    3) Again, I stress, this was just another CA ejectment case for post sale possession (Aurora V Corbet, S. / Vallejo CA Sup Ct 2010) so what was so unusual about the lawyer’s plea to be released?
    4) The judge’s decision – she ruled for the home owner W PREJUDICE!
    Note – I can’t sell my testimony on this one though I did provide an affidavit.

    It’s what the Judge was saying (message sent) to the lawyer that concerns me. Maybe – “you stayed in this one too long?” Or “why did you collect one too many monthly enegagement fees” and was this somthing that took place while both knew the client could never win.

    I’m sitting back and analyzing these cases I have been engaged to testify in and it’s a similar story over and over again. (I often hear the witness’s testimony is not credible, he’s arguments lack substance or maybe he is too early into the case …and of course – the witness doesn’t deliver as in win.

    . . . Then the lawyer goes to court to plead RESPA and TILA, and QWR. You get the message  what is going on here.

    This is of course food for thought and not to imply anything other than personal first hand experiences . Its all just wierd …thats all wierd !

    DISCLAIMER: Not an attorney and not to suggest your rights can be represented by someone other than a licensed practitioner. Call your local bar for lawyers in your area.

    Foreclosure Defense Testimony
    Civil / Criminal

    beatenpath@inbox.com

  11. I gotta believe that a large number of these sub-prime loans were kicked for underwriting violations.

    The Path : If so they would constitute a lender default under GAAP rules as all loans are re-recognized subject to a non controlling interest. So I don’t see anything getting kicked.

    No assignments as they ended up on the big-bank balance sheets hidden in their bucket #3.
    The Path : No assignments are ever necessary in these deals under, least not from the holder to the assignee. Think about it Roger …the last assignment you ever see is the first one.

    Pledging the assets to multiple trusts is also documented.
    The Path : This is gibberish. The consortium of institutional players representing the various trusts was already in the deal before each bond was underwritten. They had no say in the matter of placement.

    The possibilities are endless as to where the collection rights ended up. That’s what we need to find out.
    The Path : It’s not the collection rights you need to focus on Bubba. Focus on the Obligor, and to his obligor and then to the creditor as bond holders

    Somebody needs to find out who the collection action is being pursued on behalf of.
    The Path : There is nothing relevant to the collection rights with regards to your loan – it was de-recognized remember – huh, yeah (your still not getting it Bubba)

    Once the bond blows up, that’s all that is left.
    The Path : True and that cannot be self induced – this is what you all need to remember.

    Year 7 for me and few if any listen. In spite of the mass of evidentiary, case history and in court errors by the opposition ….majority still not getting it.

    (But I do believe the American Bar Association gets it – Hmmm. There’s too much out there for the lawyers on our side not get it also the State, they have to know. But no one is talking ….just taking more engagements and fees ….really)

    beatenpath@inbox.com

  12. Barry Fagan correct

  13. @ukg

    Isn’t the “collection action” being pursued on behalf of the junk debt buyer?

  14. I gotta believe that a large number of these sub-prime loans were kicked for underwriting violations. No assignments as they ended up on the big-bank balance sheets hidden in their bucket #3.
    Pledging the assets to multiple trusts is also documented. The possibilities are endless as to where the collection rights ended up. that’s what we need to find out.
    Somebody needs to find out who the collection action is being pursued on behalf of. Once the bond blows up, that’s all that is left.

  15. Nick Wooten’s case from Alabama has the nice NY Trust Law dissertation. Used it in my suit.

  16. dcbingo, sounds familiar. you should find an attorney.

  17. @d wynn – you might want to take a gander at my comments last night under “Alert: Trustees Selling Liens not Property”. Might be something useful in there.

  18. enraged- they get PAID whilst they “tear at each other” its what they do
    meanwhile back at the ranch

  19. They’re gonna tear at each other until they all croak… under the weight of legal expenses. Now may be a good time to go to law school…

    http://www.globalresearch.ca/index.php?context=viewArticle&code=STE20120805&articleId=32213

    Worldwide Financial Crisis: Libor Scandal goes Global

    by Robert Stevens

    Global Research, August 5, 2012

    “… On Monday it emerged that New York-based Berkshire Bank is suing 21 banks including Bank of America, Barclays and Citigroup for damages over alleged Libor manipulation. Berkshire’s claim alleges that the rigging of Libor had a detrimental impact on its interest payments. Its legal complaint states, “Tens, if not hundreds, of billions of dollars of loans are originated or sold within this state each year with rates tied to [U.S. dollar] Libor.”

    New York banks “were unable to collect the full measure of interest income to which they were entitled”.

    Harvard Law School professor John Coates said that litigation resulting from the Libor crisis “has the potential to be the biggest single set of cases coming out of the financial crisis, because Libor is built into so many transactions and Libor is so central to so many contracts. It’s like saying reports about the inflation rate were wrong.”

  20. shoot- i mean pRosecute

  21. enraged- the bankwill have that money back in the blink of an eye and posecute the people who took it in bad faith dont ya know

  22. JG,
    you just wrote something that i jumped on, this is why i read this site we have a nice brainstorming going on which may ignight a fire in someone elses stage of litigation. in gratitude.

  23. rule 8 does not govern discovery – see rule 26, which includes this:

    a) Required Disclosures.

    (1) Initial Disclosure.

    (A) In General. Except as exempted by Rule 26(a)(1)(B) or as otherwise stipulated or ordered by the court, a party must, without awaiting a discovery request, provide to the other parties:

    (i) the name and, if known, the address and telephone number of each individual likely to have discoverable information—along with the subjects of that information—that the disclosing party may use to support its claims or defenses, unless the use would be solely for impeachment;

    (ii) a copy—or a description by category and location—of all documents, electronically stored information, and tangible things that the disclosing party has in its possession, custody, or control and may use to support its claims or defenses, unless the use would be solely for impeachment;……………………”

    We have apparently been slow in seeking or at least arguing ELECTRONIC DISCOVERY. Kroll ontrack has been a leader in this field and they have many cases available. Google “Kroll ontrack”. Years ago, before all this bull started, I participated in some of their online seminars for an unrelated matter – good stuff.

    A guy the other day linked his discoveyr requests. Hope he doesn’t live in CA:

    http://en.wikipedia.org/wiki/Discovery_(law)

    scroll down to CA’s stuff. Cripes!

  24. “.are refusing to comply with discovery, and while their refusal is subject to a later hearing they proceed with the foreclosure …

    The truth is, courts have wide latitude in dealing with discovery violations, including dismissing or ruling in favor of, with prejudice. Secondly, non-responses may be taken as admissions of facts (caveat: this is an I think – but this is at least relevant to an answer under Rule 8, failure to deny). Thirdly, responses which are given but are not in fact responsive, are fluff, can be stricken after motion (to strike). Even if you can’t get a dismissal with prejudice for disc violations (yes , this is an extreme sanction, but within court’s power), you can motion 1) alternatively for a stay of any action of foreclosure pending compliance with discovery 2) alternatively for a dismissal without prejudice (I don’t like this one – they shouldn’t get 5 bites at the apple). Case law holds that a court does not have to resort to a lesser sanction than dismissal with prejudice; it may decide.

    Of COURSE they will proceed with f/c if they can get away with it. The art of the deal is to not let them get away with it….. by filing an emergency motion if necessary seeking injunctive relief for any good reason, including as sanction for discovery violations.
    Lay opinion, not legal advice, as always.

  25. re: case enraged posted:

    ” ….FINDING GENUINE ISSUES OF MATERIAL FACT AS TO WHETHER THE NOTE AND MORTGAGE WERE TRANSFERRED TO DEUTSCHE BANK BEFORE (BLAH BLAH)….”, in this case, the orig lender’s bk.
    Why, your dearest honor, do you see a distinction between the bk date and another date – the cut-off date? Is it that you don’t have to grapple with trust law but you’ve got bk law down cold? That’s not a rhetorical question and it’s not meant with any disrespect, truly. But if that be the truth, then maybe we should start sticking trust law verbatim in judges’ faces. Because why shouldn’t the following lead to the same finding by a judge:

    “….finding genuine issues of material fact as to whether or not the note and mortgage were transferred to deutsche bank before (insert here:)
    the cut off date of the PSA / governing document.”

    Now, under bk law, the judge knows it might not be possible for the orig lender, the alleged assignOR, to have transferred an asset post-bk. In the case of the cut-off date, it’s different in one regard, I’ll grant: it’s the assignEE who can not possibly become the recipient of a transfer post cut-off date. I don’t’ see a legal distinction, so I can only infer that judges need trust law in their faces, and i don’t mean that, either, in a negative way; simply seems to be the case. Would it help? Who knows, since as far as I know we are submitting no trust law for judicial notice (or whatever that would be) with our cases, but I can’t see that it would hurt. Secondly, where are we to find this trust law to submit? I don’t know about anyone else here, but I don’t know. Who does?

    As to the HA case, true – at least it’s a chink in the armor.

  26. My kind of news… Reminds me of a newspaper automatic distributor years ago: if you put a $20.00, it gave you your money back plus your change AND your paper. I made a couple of bucks out of it…

    ATM Malfunctions, Accidentally Gives Away Free Money

    An ATM located inside a Lloyds Bank in Ipswich, England started malfunctioning and giving away money. The ATM was giving out double what was requested by the customer. Word spread quickly and several people were able to take advantage of the machine. 🙂

  27. http://foreclosuredefensenationwide.com/

    VICTORY IN HAWAII: Deutsche Bank v. McKiernan, Case No. 09-1-000910. JUDGE DENIES DEUTSCHE BANK’S MOTION FOR SUMMARY JUDGMENT FINDING GENUINE ISSUES OF MATERIAL FACT AS TO WHETHER THE NOTE AND MORTGAGE WERE TRANSFERRED TO DEUTSCHE BANK BEFORE THE BANKRUPTCY OF THE ORIGINAL LENDER AND THAT THERE IS NO EVIDENCE THAT THE ASSIGNMENT WAS DONE WITH APPROVAL OF THE BANKRUPTCY COURT

    This case (Deutsche Bank v. McKiernan, Case No. 09-1-000910, Hawai’i First Circuit, 21st Division) has many similarities, factually, to the Williams case from the Hawai’i Federal Court where the court permitted the homeowner to challenge Deutsche Bank’s compliance with the PSA in view of a purported assignment which was executed after the same original lender filed for bankruptcy, rejecting Deutsche Bank’s argument that the borrower did not have standing to lodge such an attack.

    August 3, 2012

    CALIFORNIA FEDERAL COURT DENIES MOTION TO DISMISS HOMEOWNER’S COMPLAINT, HOLDING THAT ALLEGATIONS THAT ASSIGNMENTS TO A SECURITIZED TRUST WERE NOT DONE PROPERLY OR TIMELY GIVES RISE TO INFERENCE THAT ASSIGNMENT, SUBSTITUTION OF TRUSTEE, AND NOTICE OF DEFAULT AND ELECTION TO SELL MAY HAVE BEEN IMPROPER
    The case is Naranjo v. SBMC Mortgtage et al., No. 11-cv-2229-L(WVG), U.S. District Court for the Southern District of California, decision issued July 24, 2012.

    In what we consider to be a very significfant decision, a California Federal court has issued an Order denying a Motion to Dismiss the homeowner’s Complaint against JPMorgan Chase, U.S. Bank, N.A., and SBMC Mortgage where the homeowner challenged the nonjudicial foreclosure on the basis of an improper transfer of the loan to the securitized mortgage loan trust. The homeowner alleged that the Defendants and others were involved in an attempt to securitize her loan to a WaMu securitization trust.

    August 3, 2012

  28. http://msfraud.org/

    In the 1930’s, 25 states enacted moratoriums on foreclosures. The Michigan Moratorium Act meant that anyone facing foreclosure got an automatic 5 year stay on the foreclosure, with a judge ordering a reasonable payment based on the homeowner’s ability to pay. These laws were upheld by the U.S. Supreme Court in the case of
    Home Building & Loan Building Association v Blaisdell
    which held that the people’s right to survive during an economic emergency superseded the contract clause of the U.S. constitution.

    The moratoriums were not a result of the generosity of the legislatures or the courts, but were a direct result of the actions of workers and communities flooding the streets and preventing the foreclosures that were being carried out. The legislatures and courts essentially ratified the moratoriums that were won in the streets.

  29. BofA has not responded to my New Matter when I responded to the Foreclosure Complaint in April. In early June, my lawyer and I prepared a Request for Interrogatories and Discovery which BofA should have responded to by early July. Nothing. Even without discovery, I have documentation which confirms my note was sold to Bank B. I also have proof that the assignment which BofA recorded at the court house but did not attach to the Foreclosure Complaint is fraudulent. Should I request a Motion to Compel or simply file a Motion to Dismiss?

  30. Barry Fagan v Wells Fargo Bank Re: VERIFIED COMPLAINT 1. FOR DECLARATORY RELIEF; 2. TO QUIET TITLE TO REAL PROPERTY; 3. FRAUD/MISREPRESENTATION-CONCEALMENT; 4. FRAUD/MISREPRESENTATION-INDUCEMENT; 5. VIOLATION OF 15 U.S.C. § 1641 (g) 6. FOR AN ACCOUNTING

    http://www.scribd.com/doc/99220650/Barry-Fagan-v-Wells-Fargo-Bank-Re-VERIFIED-COMPLAINT-1-FOR-DECLARATORY-RELIEF-2-TO-QUIET-TITLE-TO-REAL-PROPERTY-3-FRAUD-MISREPRESENTATION-CON

  31. Barry Fagan v Wells Fargo Bank Re: Request for Production of Documents Set One SC117023

    http://www.scribd.com/doc/100997985/Barry-Fagan-v-Wells-Fargo-Bank-Request-for-Production-of-Documents-Set-One-SC117023

  32. Bill McMachen Buys Every Single Tax-Foreclosed Home In Macomb County, Michigan

    http://www.huffingtonpost.com/2012/08/03/bill-mcmachen-macomb-county_n_1739062.html

  33. Mistakes happen. Long live Neil Garfield.
    Be Strong and Courageous
    NEVER AGAIN.

  34. Judge Tarle did not get it. Mistake by Livinglies. The new judge Carig D. Karlan got it.

    Never Again.

Leave a Reply

%d bloggers like this: