… the courts have been following an illegal doctrine for about 25 years. It is called “The Homeowner Should Always Lose.” This is closely related to the corollary doctrine of “False Foreclosure Claims Should be Allowed to Prevent Economic Disaster.”
Besides foreclosure litigation, several rules and laws limit how long a claimant in civil litigation can drag out their claim.
First, there are statutes of limitations on making a claim. The usual limit is 5 or 6 years. And the way that works is that the courts measure the time from the moment of a breach of duty or promise.
The court then adds the statute of limitation, and presto, it has an end date after which the claimant may not sue to enforce a perfectly valid claim. The purpose of this statute is to prevent the drain on judicial resources and to give finality to a dispute that has been festering for too long. It also stops the unscrupulous from suing late int eh game to gain a strategic advantage over someone.
Next, you have the closely related rule of civil procedure (also a statute) that gives the climate who has sued for something a period in which they must pursue their claim in court. Failure to do so will result in dismissal, albeit without prejudice (the first time) and then with prejudice the second time.
The court looks at the last thing done by the climate and then adds the period during which they should have prosecuted the claim. If they didn’t, the claim is dismissed. Usually, it is one year. This rule is because it costs money to keep a case alive, even if the parties are doing nothing with it.
Lastly, there are statutes of repose, which few people talk about because they mostly do not apply. These statutes say that regardless of the circumstances, the dispute is over as of a certain date computed from the date the dispute started. The courts do not care who was right or wrong; it is over. The main purpose of such statutes is that it is nearly impossible to litigate a case 20 years, for example, after the events occurred and the people witnessed things. Documents disappear, and people forget.
Until the securitization era (i.e., the era in which false claims of securitization of debt were accepted as true), the above rules applied to foreclosures. And now, in the State of New York, a state senator named James Sanders is proposing that those rules be reinstated despite court rulings that had “relaxed” the rules. Letter writing to Kathy Hulchum, governor of New York and in support of Senator Sanders would be appropriate.
In the first place, the courts had no right to invite or accept arguments that changed the clear and unambiguous laws governing limitations and failure to prosecute. I recently assisted a homeowner who was fighting a foreclosure that was clearly barred by the statute of limitations in Hawaii.
Relying on some antiquated dicta in a decision rendered 100 years ago, the trial court and the appellate courts agreed that the statute of limitations was not 6 years; it was 20 years under the laws governing adverse possession — a law that has no relation to loans, notes, mortgages or foreclosure.
The reason for this anomaly (illegality) is that the courts have been following an illegal doctrine for about 25 years. It is called “The Homeowner Should Always Lose.” This is closely related to the corollary doctrine of “False Foreclosure Claims Should be Allowed to Prevent Economic Disaster.”
In Florida, this doctrine gave rise to the Bartram rule, which asserted that if the foreclosure was dismissed for lack of standing (i.e., under the law, the claimant had no right to claim anything), then the act of acceleration of the entire “debt” was automatically reversed and the loan was reset. In other words, the right to sue was no longer barred if the new suit was outside the period of the statute of limitations (5 years).
Only the payments that fell inside of the payments due during the limitations period were barred — but the designated claimant could bring suit repeatedly until the action was barred as to the mortgage rather than the debt. At that point, it would be over —- in perhaps 30 years.
Sound complicated? It was not complicated until the courts decided to follow the doctrines of heads the banks win and tails the homeowners lose.
Practice Note: One of the strategies that could get traction is in making a claim for a breach of a statute that is now barred by the statute of limitations and stating that it was concealed breach such that the homeowner had no access to any information that would have given him notice that a claim exists.
I have long understood the game that eh securities brokerage firms were playing on this. They would flagrantly violate the Truth in Lending Act and similar state laws, and flagrantly violate RESPA and the FDCPA, and FTC act and little FTC acts, knowing that the homeowner would have no clue that the violation existed until long after the short statute of limitations (1-2 years) expired. This leads to the defense of “Yes we lied, but it is too late for the homeowner to do anything.”
Under the doctrine cited above and named by me, the homeowner will lose. But the basis will be the doctrine of finality and other things supporting statutes of limitations. That is when claims brought for breach of alleged “mortgage debt” should be argued as barred since the court ahs already set the standard by which the statute of limitations would be applied.
Florida perfected this into an art form by passing a statute that said even if your property was unlawfully taken from you by false premises and false pretenses, if you didn’t claim within one year, you had no right to retrieve the title or the right to possession. You had to settle for damages. The unobvious import was that a new statute of limitations was being imposed on homeowners who were victims of fraud.
Tolling of the statute applies when the claims could not have been discovered until after the breach. This is always true for homeowners and never true for the law firms purporting to represent claimants (Plaintiffs, beneficiaries) that supposedly suffered a default (i.e., through ownership of an unpaid loan account owned by that claimant.
But once again, the tolling of the SOL is blocked, barred or ignored by the court under the doctrine that we need to make the homeowner lose — or something terrible will happen. And of course, the similar argument that any other result will be a windfall to the homeowner.
These fake doctrines of the courts are citing facts that are not alleged, argued, asserted or proffered as evidence in any court. These rogue court doctrines have diminished trust in our judicial institutions to such a degree that the most basic standards and customs are now out of bounds.
We need more people like Senator Sanders in New York.
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