People always write to me telling me that the documents used by the opposition are facially invalid. They say this because they do not know what they are talking about. They think the document is facially invalid because the lawyers and “Servicers” are lying. Lying, fraud, etc., is evidence of substantive invalidity but not facial invalidity. Do not use terms if you do not know what they mean in court.
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SO, generally speaking if you say that the assignment of mortgage or endorsement on the note is facially invalid, you are incorrect. Facially valid means it conforms in the form and content to the requirements of the applicable statute.
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A completely void deed, for instance, is facially valid in Florida for example, if it contains an adequate description of the property, recites the name of the grantor (even if the grantor is not the owner) and is signed by the grantor with notarization of the grantor’s signature. The continents must state that the conveyance of the title is intended.
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This is why I keep harping on the ignorance of most people. It is not an insult. It is a statement of fact. What you mean by not facially valid is that it shouldn’t be valid.
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Once a facially valid document is executed and recorded if necessary, it carries with it a presumption that (a) it exists and (b) validity of its contents. Documents recognized by judicial notice are only admitted as presumption of existence and not contents.
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Pro Se litigants and many lawyers go down the wrong path when they attack the validity of the instrument of conveyance. It is usually presumptively valid even though it might be fatally deficient. 99.9% of arguments about such documents are ignored, and properly so, if the judge is following the law.
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But none of that means the homeowner automatically loses, as many pro se litigants believe. The adversarial judicial system is set up to enable correction of the record and judgment for the homeowner if the presumptions arising from fatally deficient but facially valid documents are rebutted.
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The banks have all thought this out and planned out their strategy. They know that as long as they do not admit the fabrication and forgery of the document, the court is required to consider it valid — unless the homeowner successfully rebits the legal presumptions arising from the facially valid document.
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Going back to our example above — a void deed that is facially valid — there are two ways the homeowner can win. In our example, someone (i.e., thief) has executed a facially valid deed to the homeowner’s property, thereby asserting a conveyance of the title to the property in fee simple absolute.
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To make it more clear and more congruous with foreclosure situations, the grantee of the void deed is a fellow conspirator who neither accepts nor denies any interest in the property.
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The homeowner would go to court alleging that there was no transaction in which the grantee paid for or otherwise accepted the title to the property. The grantee does not now assert any financial or title interest in the property. The homeowner would further assert that the grantor did not possess any title or interest to convey.
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At the motion to dismiss the complaint, the allegations by the homeowner are taken as true and accepted if, when proven, they would lead to a specific remedy demanded in the complaint.
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[Or if you bring it closer to foreclosures, imagine that a third party, acting with attorneys protected by a doctrine called litigation immunity, files an eviction action against the homeowner. They would state that they are acting on behalf of the grantee even though the grantee knows nothing about the conveyance or the eviction. In that case, their allegations are taken as true but only for purposes of the hearing on the motion to dismiss].
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Back to our example. The two ways that the homeowner can win are (a) proving facts that rebut the presumptions arising from the facially valid documents and (b) knee-capping the opposition by seeking evidentiary sanctions that bar the opposition from introducing evidence of ownership.
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In our example, the first way is simple. By merely producing a certified copy of the chain of title, the homeowner can prove that the “grantor” did not have title to convey and therefore was not a grantor. Case over. Or, if he or she was lucky, a witness from the grantee would be produced saying that they had no part or interest in any transaction producing the deed. They have no such interest in the property or possession of the property. Game over. The homeowner is the winner.
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If the homeowner wanted to get into more complex litigation, perhaps because a lawsuit for intentional interference or fraud is being considered, the homeowner would submit demands in discovery.
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To the grantor, the homeowner would demand corroboration of ownership of title, and that the grantor was part of a transaction in which it sold or otherwise granted the title.
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The same sort of questions would be addressed to the grantee. Making it closer to the foreclosure situation, the answer from the grantor would be that it should not be required to answer because of the presumptions arising from the facially valid deed. That is circular logic. But it is often accepted in foreclosure cases.
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The grantee would not answer at all. Instead, the lawyer for the opposition would assert a response that mirrors the grantor’s response without any knowledge, intention or control on the part of the named grantee. The grantee appears protected from criminal and civil liability because they will say they knew nothing about the transaction. But if this is part of a pattern of thousands or millions of transactions, that defense wears very thin.
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At the hearing on objections to discovery, the objections are overruled, and the grantor and grantee are ordered to respond to the discovery demands that were presented in a timely and proper manner. There are no sanctions yet.
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When the lawyer for the grantor and grantee (often the same attorney) fails or refuses to comply with the court order, then the homeowner moves for economic sanctions and evidentiary sanctions. The judge awards economic sanctions or reserves rulings on sanctions and gives the opposition another period of time to respond.
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When the lawyer for the grantor and grantee (often the same attorney) fails or refuses to comply with the new court order, then the homeowner again moves for economic sanctions and evidentiary sanctions and demands that the opposition be held in contempt of court.
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The judge now awards economic and evidentiary sanctions, finds the opposition in contempt of court and gives the opposition yet another time to respond. If they respond, they will purge themselves of contempt, if not, they are barred from introducing any evidence of title and further barred from taking any action in which possession or title might be affected. The court might also strike their pleadings.
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It is the second path that is the only one available for homeowners in foreclosure. But it works at least 65% of the time. It requires a considerable investment of time, money, and effort. Generally speaking, while some pro se homeowners have prevailed on their own, this strategy only works if a lawyer is involved.
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But if the homeowner does win, there are substantial rewards since nobody is left to make a claim. That clears the path to seek quiet title and eventually remove the lien from the property, thus making the entire property value unencumbered equity for the homeowner.
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In the alternative, the banks will often pay the homeowner to take their win and shut up. So they pay a sum of money, reduce the “balance” of the non-existent unpaid loan account (as much as 90%), and scrub the court record of everything that happened.
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SPECIAL PRACTICE NOTE FOR LAWYERS DOING LEGAL RESEARCH: The banks’ strategy is to prevent any of this from reaching the appellate level. So each time the homeowner wins, they either pay him or her to shut up or they give up on that thread of the fake “Securitization” infrastructure and do not appeal. By not appealing, the appellate record lacks any evidence that homeowners win, which they frequently do.
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Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 14 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).
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Neil, please don’t call people “ignorant.” Use another word if you like. Do not use “ignorant.” Degrading. People have been blocked by bogus settlements, deregulation, invalid securitization, violation of Regulation AB, clueless courts, TARP/Bailout, Private Public Investment Program, Master Servicing Rights and Advances, no funding, no financial balance sheet accounting, dissolved or disappeared entities, no trust indentures, no conveyance to a trustee, entity bankruptcies, and attorneys who are afraid of their own shadow to defend, etc. etc. etc.
First, let’s open those decade old settlements for fraud. People will not be called ignorant then. This is not about people’s ignorance. It is about power and control. Buying time for up to (possibly) 14 years is not about justice. You mean rent-free – despite the fraud – but pay for it? No. That is simply about buying time – not about justice. Need justice. Time can never be recovered for the fraud origination. To suggest same is a crap shoot on life. Points are being lost here. Can’t limit to “buying time.” Everyday middle American has no clue and not going to pay for just “Time.” They want justice. You start off okay – but when go to people “ignorance” and “buying time” — it is all lost.
OK. Let Us put a Facially Valid Document on Neils house. And let’s see what happens to Us.
If you are OK with helping the Ponzi Fraud and Criminals because that is the Rules of how it always has been done, then you have shown everyone your biases. You only make money by keeping the Ponzi going and not by helping Ending it. So I say keep chasing those pieces of Fiat Paper. But Right & Wrong and Black & White is Simple to understand.
The Old World is Collapsing. Good Riddance.