Livinglies's Weblog

DreamBuilder-Invs.-v.-Merscorp-Holdings-Inc

Bill Paatalo brought this case to my attention. Reading the entire case, one gets important clues on how to sue MERS and how to demand discovery from MERS either as a party or nonparty.

As with other “securitization” documents, the analysis requires observation and assessment of what is NOT included on the contract between an originator of a homeowner transaction and MERS.

There are two major points that the court failed to understand or that it elected to avoid. MERS is basically nothing and its use is at best optional even if there are clauses of exclusivity within the MERS-Member contract. It is an agent for the originator and it is not the actual lien holder — although in today’s world of pretending that a virtual loan account can be enforced without the existence of a real loan account — many courts, lawyers, and even homeowners have accepted the myth that MERS is actually in the transaction cycle in which the homeowner’s promise to make payment was issued.

First let us define the word “transaction” such that it reflects the meaning and intent of all statutes and case decisions that use the term. A common mistake is to characterize documents as a transaction.

Simple example: if I execute a document conveying ownership of the Bronx Zoo to you, that is not a transaction unless several conditions are also present. First I must own the Bronx Zoo, which I don’t. Second, there is no transaction unless there was payment or the conveyance can be shown to be a gift — which is impossible because I don’t really own the Zoo and therefore have no legal right coney ownership nor create the appearance of ownership for the grantee.

So in plain words, a transaction is only acceptable terms if there was an actual business transaction in which the subject was paid for and purchased by the grantee. Any conveyance that is subsequently used to assert ownership by a succession of grantees is a false document unless the grantee paid value for the underlying obligation (not the note or mortgage).

You can look this up under the laws of any jurisdiction: an assignment of mortgage that is not accompanied by a concurrent legal conveyance of the underlying obligation is a LEGAL NULLITY. While there are procedural tricks and presumptions that can be used to raise the assumption or legal presumption that the obligation was transferred, all of that can be rebutted and derailed by either showing there was no payment of value for the underlying obligation or by showing that the opposition cannot or will not corroborate the presumption that the underlying obligation as conveyed.

MERS is not in any transaction cycle. It even says so on its website. But that if that was not enough, there is no instance in the history of any of the MERS entities where MERS funded or received any money to or from any homeowner. Since it never acted within the transaction cycle it has no legal right to do anything. That didn’t stop the adhesion contract between the originator and MERS in which the originator agreed to use MERS procedures to create the fiction of MERS signing officers even if those officers were not officers and knew nothing about the transaction or even that their signature was being used.

MERS is ONLY a name that is a placeholder in the paper chain — which based upon the above — does not reflect any sale of any claimed loan account receivable. The ownership claim is based solely on the fact that MERS is named in a conveyance even though it has no legal, inherent or equitable right to receive such title to the mortgage or deed of trust. The use of MERS was intended to be part of a scheme that depends entirely upon false claims, erroneous presumptions of law, and obfuscation of real-world events — instead of the legal requirements that such documents be a memorialization of real-world events.

MERS is “appointed” as an agent for the originator who is required to be a MERS member in order to participate in the scheme that is entirely based upon false claims of sale and securitization of loan products.

The originator does not pay for such transactions, so there are no legal rights of the originator to do anything in connection with the lien that was filed and recorded. Only the owner of the unpaid loan account receivable has the right to do anything — if such an account exists. As I have stated in recent articles there can be little doubt that such accounts do not exist anywhere on the books and records of any company that claims, on its own, to be a creditor.

Instead, for 25 years, Wall Street has escaped prosecution for faking it. In court, we are presented with no direct statement that the named claimant owns anything. It is the lawyer who implies that the named Plaintiff owns a loan product and that therefore there exists an unpaid loan account receivable.

And instead of the requirement developed over centuries, the lawyer does NOT produce any record or accounting based upon the books and records of the implied creditor. We are presented instead with false documentation and circular logic.

I have reviewed (many thousands) where the currently implied creditor is claimed by counsel to be entitled to legal presumptions as to the ownership and existence of the underlying obligations and hence the note and mortgage. Where such claims are based upon the sale of the loan account and “Securitization” has there never been any evidence of an actual transaction in the real world other than false — frequently abandoned — assignments of mortgage or beneficial interest.

Instead of a proffer of the records of the named implied creditor as claimant, we are instead presented with a “Payment History” issued in the name of a company that is claimed to be a “servicer” but who neither receives nor distributes any money received from the homeowner. Like MERS, the “servicer” is just a placeholder — a front for FINTECH companies doing business on behalf of undisclosed investment banks.

The principal-agent relationship that is created on paper between the originator and MERS is also subterfuge.

Since the originator did not fund any transaction with the homeowner and instead allowed an undisclosed third party to fund the transaction (in exchange for undisclosed exorbitant fees) the agency of MERS is at best limited even if it is described as exclusive or mandatory.

If the originator never owned any loan account receivable on its own books and records or ceased such ownership contemporaneously with the origination, then it could not convey the essential element of any document that purportedly transferred, released, or appointed anyone to administer, collect or enforce the promise to of the homeowner to make a scheduled payment as set forth on the note.

The missing essential element — as required by statutory and common law — is a conveyance of the underlying obligation claimed to be in existence. There is never any such conveyance in the context of false claims of securitization because the grantor never owns any underlying obligations and therefore cannot create rights of ownership in the grantee.

No payment of any kind was ever made because none was due — i.e., the process of creating a virtual loan account (liberally called “securitization”) requires the elimination or retirement of any real entry creating an unpaid loan account receivable on the books and records of any company.

Filed under: foreclosure |