Malpractice Claims Against Real Estate Lawyers Climbing

Editor’s Analysis: As we predicted along time ago, the day would come when the best cases for litigators would be malpractice claims against lawyers who are dealing with real estate transactions. And as we have said before it includes bankruptcy lawyers, family law and a host of other cases where issues of title and validity of the loans might come into play.

It’s all starting in the commercial sector but it will spread to practically every other type of lawyer who is ignoring the securitization issues, the foreclosure crisis, and the mortgage meltdown.

For the first time, real estate lawyers are Number 1 in malpractice claims ahead of personal injury and other lawyers. And the problem is made worse by the fact that the seminars, for the most part, do NOT inform the attorneys of the probability of title problems arising out of transactions where their opinion on title almost seemed irrelevant. AND THAT in turn leads to the mistaken conclusion that this is a problem contained in the residential real estate market with homeowners who are deadbeats trying to get out of paying a legitimate debt. It remains a major issue as to whether the debt was ever legitimate as a secured transaction, and probably will lead to all sorts of problems for clients who relied upon their lawyers before entering into commercial or residential real estate transactions who who litigate those issues.

The bankruptcy lawyer who fails to understand the problem of showing the home as an asset secured by a mortgage is going to find himself and his carrier sued for malpractice if and when it is determined that the home was not secured and the creditor named was the wrong one, playing right into the hands of the banks and servicers.

Lawyer Beware!

Real Estate Lawyers face rising malpractice claims

34 Responses

  1. @tn harry & dcb

    Some of us want to get to the bottom of this and some want to muddy the waters. Thank you for sticking to topic.

  2. Garfield

    page 10-11——surrender of note critical to prevent servicer double claims

  4. A doubled up claim–or two parties claiming standing on the same note? is one a thief?

  5. Rucker v. State Exchange Bank, 355 So. 2d 171 (Fla. 1st DCA 1978).

    payment to person that could not surrender the note—

  6. America for sale to the largest bidder. Today, it’s India. Tomorrow, China and, on the following day, Russia.

    Better brush up on your foreign languages…

    Pacifica Companies, LLC operates as an integrated real estate developer, owner, investor, and investment manager. Its real estate portfolio includes hotels, mixed use/infill development projects, development projects, master planned communities, office space, industrial buildings, retail shopping centers, senior housing assets, single tenant leased properties, multifamily for rent and sale projects, and single-family communities in the United States, Mexico, and India. The company also engages in the acquisition of performing and non performing debt instruments; and owns and operates hotels in the United States. Pacifica Companies, LLC was founded in 1978 and is based in San Diego, California with additional offices in Ahmadabad, New Delhi, Bangalore, Chennai, and Hyderabad, India.

    Key Executives for Pacifica Companies, LLC
    Mr. Deepak Israni
    Chief Executive Officer
    Mr. Ashok Israni
    Age: 64
    Mr. John Phillips
    Chief Financial Officer
    Ms. Shauna Pribyl
    Chief Operating Officer
    Mr. Sushil Israni
    Principal and President of Hospitality Group

  7. California company buys 700 Florida foreclosures in single sale
    by Kim Miller
    The Federal Housing Finance Agency sold 700 Florida foreclosures owned by Fannie Mae to a San Diego-based company that paid $12.3 million for an interest share.

    The sale, which closed Thursday, is the first in the government’s nationwide plan to sell foreclosed homes to private investors who must rent a certain percentage out before selling.

    Florida had three clusters of homes for sale, including 376 in Southeast Florida, all of which were purchased by an LLC created by Pacifica Companies. Pacifica Companies owns varied real estate projects, including hotels and master-planned communities, in the U.S., Mexico and India.

    As part of the deal, Fannie Mae will retain initial member interest and receive 90 percent of the distributions to the LLC until it has reached $49.3 million. After that, Fannie Mae is entitled to receive 50 percent of the distributions. The total estimated value to Fannie Mae is $78.1 million.

    Another group of homes up for sale in the Atlanta area did not receive any acceptable bids and will either be repackaged or sold individually, according to a source familiar with the sale.

    big question is whether this entity is tied into some of the offshore hedge funds that control some of the us banks and submit fixed bids at fixed auction–is this an outfit controlled by ______… for example–from ________…–or somebody in control og BankU____

    We need to be on the lookout for behind the scenes manipulation of selling prices–cherry-picking, inside info trades–the offshore hedge funds are likely to have these capabilities and are unregulated—but if caught in the act they can be tossed out of the US banking system

    The Indian connection is telling–somebody that was tied into Far East land deals–and has outsourced servicing etc to Indian subs—-that is the sort of thing to look for–Indians ask no questions–they just move paper–like robosigners–and you cant depose them either as a practical matter—

  8. @ TH

    I respect your perspective and honesty in disclosure. I think it is very important to have a balanced discourse. Having people state some commonly held view repeatedly without looking at the holes is not going to help in front of a neutral party such as a judge or mediator.

    If these people have differing legal views let them state it—discuss it and agree to disagree –or note the factual distictions. This stuff going on recently is designed to intimidate and frustrate–and confuse the hell out of everybody.

    it violates ones 1st amendment right to hear free speach. The recent fuming that I received because I stated that negotiable notes were subject to all the rules re payment, satisfaction, presentment –things that are important to all homeowners–not just foreclosure scenarios–were beating on me just for stating it because of the differences between negototiation and pledges in bulk by way of quasi assignment. so some myopic individuals focused on the narrow issue of transfer mechanics as between 3 and 9 asserts that 3 never applies for any purpose. that is so pathetic–to try to buck up a flimsey position –or one not even controlled by the provision –by trying to wite an entire article of UCC out of the law—–and they do it by piling on multiple persons out of the woodwork to say derogatory and unprofessional remarks.

    as if someone owned the rights to discuss the matter—-

    some of that is going on here–albeit as a bank rep–you can well understand why servicers will not want to hear borrowers demanding compliance with 3-501 –including 3-309—and real estate lawyers are not going to want to hear they missed 3-601 et seq—and their clients are still on the hook for loans they thought were paid out–so if the real estate atty failed to get the note discharged properly—who is guaranteeing that homeowner against a 2nd coming? the malpractice insurance carrier to be sure

    the average reader hhere does not think about these things from the real estate atty perspective–but im trying to cousel real people how to cover themselves on buy/sells of realty that has nothing to do with foreclosure–which i tell em not to touch–$10 k minimum to try to get opinion on a foreclosure–the research is far beyond simple record title–now it includes unrecorded poas–did atty for bank have authority simly because of making appearance—-of course not–not binding on the bank–wher the atty is representing a couple trusts–a servicer or two—etc all for one note

    how are you gonna give a title opinion clean where a property or note was transferred 5 times among trusts over 18 months?

  9. @dcb – so strange and so useless. what’s the point, unless trying to diminish the site’s and Neil’s credibility, or to so muddy the waters to make it difficult for “regular citizens” coming here. and to think i’ve been accused of being a banker shill for that purpose…

  10. @TH Re the IVENT crowd
    about a week ago —it looks like at least 2 peple with near 24 hour coverage–repeating the same extremist stuff as many as 20 times a day

    will not answer questions—-tax protestor anachist type

  11. when did this site get hijacked by Ivent? sorry carie – you’ve been pushed to the side by Ivent’s frequently posted ramblings.

  12. Here’s how it’s done folks….by waving unlimited amounts of free money received through the generosity of unknowing taxpayers provided by their captured Treasury, the FIRE lobby can pay to remove any and all oversight in the present and the future.

    This is the sound of the death gurgle of democracy.

  13. and it all started with a signature, how was the average joe supposed to understand what he was in fact signing for, was it any of his business, hell yes, was it in any way fair hell no. is life fair- well thats a very silly question isnt it, but as for the subject today the lawyers working for the banks at 800 bucks an hour will go down in history, great work guys, lovely. and karmas a bitch.

  14. insolvent debts…” Odd way of expressing it.

    A debt cannot be “insolvent”.

    ….He means the debtor ….The principal debtor is the lender and lenders next in line and who each in turn are an obligor and who the latter is allowed to move liabilties off balance sheet to remain solvent.

  15. I have requested for clients time again, the required lender successors disclosures and none have come to date. This violates FSP FAS 140-4 and FIN 46(R)-8 whereby the Fed move in December 2008, followed the FASB issued memorandum concerning FSP SFAS No. 140-4 and FASB Interpretation (FIN) 46(R)-8,

    Herein are the “Disclosures by Public Entities (Enterprises) about Transfers of Financial Assets and Interests in Variable Interest Entities” (FSP SFAS 140-4 and FIN 46(R)-8). FSP SFAS 140-4 and FIN 46(R)-8 amends FASB SFAS 140 “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities,”

    Neil Garfield picks his arguments weekly with hype that gets people to buy audits. Of what ?

    I beleive from my seconary experience and 25 years of this business that the issues surround the accounting for transfers and servicing of financial assets and extinguishments of liabilities,

    My God, how can a mortgage exist is the cost basis in the asset was extigiushied . On good faith ? Your making payments on good faith to a successor like One West who is receiving free mortgages to ramp up its portfolio. This involves the FDIC under the loss risk share program and splitting the write downs and losses from foreclosure sales that do not have an economic value until the time of credit bid.

    ”These disclosures denied the client is requiried of the public entities to provide additional disclosures about transfers of financial assets. (See FSP SFAS No. 157-3 – In October 2008, the FASB issued FSP SFAS No. 157-3)

    Upon my engagement I always ask the foreclosing party to disclose their method and means in accounting for transfers by determining the fair value of a financial asset when the market for that Asset is not active (See rules FSP 157-3).

    Likewise I could not get any assistance from One West to clarify the application of the provisions of SFAS 157 as for the inactive market and how an entity would determine fair value in an inactive market.

    Under FSP 157-3 and from date September 30, 2008, One West financial statements has continued to fail to include any disclosures of these provisions and unlike the client who is in default, has not materially affected the Company’s consolidated financial condition or results of operations.

    But thats not the problem I consider the greatest road block . Its the plaintiffs attorney that has no comprehension for what Im talking about


  16. When corrupt attorney Thomas P Malone of Fidelity National Title
    and his partner in crime corrupt Attorney David K Fiveson of a scam Title company he calls Coronet Title, didn’t pay attention to due diligence and didn’t want to indemnify, they paid a bribe to the Judge to overlook the fraud.

  17. “insolvent debts”

    nobody here knows what that even means and not trying to guess

  18. “insolvent debts…” Odd way of expressing it.

    A debt cannot be “insolvent”. A person or a corporation can be insolvent but not a debt. Being “insolvent” means being unable to pay. A debt doesn’t pay. A debt doesn’t owe. The debtor does.

    A debt can be unenforceable, illegitimate or even flat out illegal, all cases in which it is not collectable. Speaking about “insolvent debts” makes no sense.

    I thought I was going to clarify for communication sake.

  19. Sadly, I am not exaggerating. In foreclosure, the banks are lying and deceiving by trying to collect on insolvent debts they created, and the judges are allowing it.

  20. Dc…here we go again…the baseless accusatory statements …What substanitive questions are you referring that have I not answered..?

  21. Dc…the commies have always been here in disguise….I can’t send you any fiat currency, the commies stole it…and the money printing machine.

  22. DCB,

    I posted that for you on a previous page.

    Ohio case. Deutsche filed for foreclosure. Holden countered for FDCPA violation as Deutsche had failed to prove ownership of the note. DB filed a motion to dismiss the counter. Judge said “No way”.

    Holden is claiming everything under the sun. Including the kitchen sink.

  23. IVENT

    I know you dont answer substantive questions—im trying to figure out what your purposes are—how old are you —im trying to figure out the peculiar perspective—–did you just pop out of the 1920s via time machine?

    did anybody tell you there are no commies anymore?


    well feel free to send me all the worthless fiat currency you care to—need an address? i prefer small bills of that wortless paper—then you wont have to worry bout valuating it

    one man one vote—


  26. The banks lent credit dc….NOTHING OF VALUE…. CREDIT BACKED BY FIAT CURRENCY HAS NO MONETARY VALUE…….Article 1; Section 10 of the U.S. CONSTITUTION says it is illegal to take anything but gold or silver in exchange for bills of credit… that would mean FIAT CURRENCY OR PROPERTY….Why? Because FIAT CURRENCY HAS NO VALUE…YOU CAN’T VALUATE PROPERTY OR ANYTHING FOR THAT MATTER, WITH VALUELESS FIAT CURRENCY…

  27. enraged..GITMO is still open, that could be used to take up the slack.

  28. @IVENT said “there is fraud in every mortgage, the banks never lent you any money,”

    Never say never—-this over the top stuff undermines your credibility ivent–even if you actually show something–nobody will believe it –in company with these obvious exagerations—

  29. Got a question…

    All those FEMA camps… how many people can they house altogether? Wouldn’t that be something if there were just the right number of Fema cells to house exactly the total number of all those who, directly or indirectly, took part into that scam?

    Let’s start adding up: real estate brokers who pushed buyers and sellers, title insurers who never conducted a title search. Closing lawyers. Foreclosure mills. Bankers. Geithner. Holder. DeMarco. JDBs. Boy oh boy! Whaddyathink? 🙂

  30. “As we predicted along time ago, the day would come when the best cases for litigators would be malpractice claims against lawyers who are dealing with real estate transactions.”

    Too many of them anyway. Time to clean up this country. They don’t hesitate going after anyone and everyone. Time they started going after each others…

  31. If they are lying to the people, just like the banksters, the media and the politicians, they should go to prison. They can be deceptive, if you don’t know the truth is… there is fraud in every mortgage, the banks never lent you any money, and ALL OF THE DEBT they created by comitting fraud with our signatures, is now INSOLVENT. IT CAN NEVER BE REPAID…IT IS UNSUSTAINABLE…..THAT IS WHAT AN HONEST ATTORNEY WILL TELL YOU…The real danger here are ANY beliefs that there is some way of “fixing” fraud. THE TRUTH IS…there are NO legal “fixes,” that’s why foreclosures is called FRAUDclosure…or monetary “fixes” for a quadrillion dollars in fraud.

  32. The lawyers that are committing malpractice and should be sued are the foreclosure mill attorneys. Here in Maryland several foreclosure attorneys admitted to robo signing Affidavits but not one lawyer has been disbarred. In states where the substitute trustee is an attorney, homeowners need to sue if the documents presented do not support the the foreclosing party has legal standing. If fraudulent documents are used by the attorney to steal the home then sue. More of these foreclosure mill attorney need to held accountable.

  33. It seems nearly impossible for the average atty that did RE work to give a title opinionif there has been a loan either made or discharged since 2003. The numerous issues attendant to electronic note—false claimants —etc.

    Example: Assume the host state follows the rule that the mortgage follows the note. The claimant asserted it had the right to enforce the note–wrongly—presented a nice copy of note—but on its face was wring color ink—-so maker knew it was not the real note–but went along with the siezure because no one believed him. But the court record shows the maker knew it was a forgery

    Note is not discharged as against HDC—so how can the frauder release the mortgage? Everybody on constructive notice that the claimant was not in possession—-

    does notice turn on the filing of lis pendens?
    does the judgment entry cutting off the complaining maker also alter the HDC status—its an HDC v Bona fide purchaser of property—atty represents the BFP—–title insurance doesnt cover the event because foreclosure issues not covered?

    It seems that the duty to investigate things that are in the record by lis pendens refeence poses a significant challenge to the atty—hes gt to be really knowledgable of a lot of issues—–used to be just look at chain and make sure no wild hares—now ???

    AUTHOR please help me here: What does the title search checklist look like now? How does a title atty cope with a limited warrantee deed in the chain, where title insurance had an exclusion? If these things turn up—how can a simple local re atty render an opinion? Fee for opinions must be skyrocketing—-causing re attys to be ver uncomfortable—

  34. thats a good way to break up their club !

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