Chase loses again after trying sneaky maneuver


Neither Chase nor anyone else actually has a claim or a case against the homeowner if the premise is that either Chase or some other named “trustee” owns the loan through the magical process of “securitization”. The fact that securities were issued is not a license to lie. Using a label doesn’t mean anyone is telling the truth.

Even Chase couldn’t stomach defending a nonexistent securitization process; so it lied about something else. In this case it lied about ever receiving the note which would, in turn, have been evidence of transfer of title to the underlying debt/obligation.

Hearsay is hearsay. It is not admissible as evidence of anything. The affiant in submitting the affidavit stated only that he reviewed records and came to the conclusion that the note had been delivered, raising the presumption that the loan obligation had been purchased.

Courts are not interested in a witness’s conclusions. they are interested in the facts. And the facts are that the affiant did not attach the records about which he was testifying — in order for the court to come to its own conclusion.

The reason for all of this is that Chase never did get delivery of the note, never purchased the underlying obligation for value, and therefore did not own or control the transction that is labelled as a loan. It lied about everything, concealing the fact that a Lehman trust claimed ownership (which was also a lie).

See JPMorgan Chase Bank v. Tumelty, 2020 N.Y. Slip Op. 6766 (N.Y. App. Div. 2020)

From Follow up by Bill Paatalo:

Nice mini-victory here. I’ve been assisting in this case. This goes to the heart of what we’ve been discussing and posting regarding the WaMu notes. Chase cannot overcome the obvious deficiencies. I mentioned this case on the Show and the fact that Chase admitted after judgment the loan was in a Lehman Trust.
The plaintiff asserts that it was in physical possession of the note at the time it
commenced this action. The note was not attached to the complaint. In support of its motion, the plaintiff relied upon the affidavit of Evan L. Grageda, an employee of the plaintiff. Grageda averred that, based on his review of the plaintiff’s records, the plaintiff took possession of the note on or about July 20, 2009, and that the plaintiff was in possession of the note when the action was commenced on September 13, 2012. There were no business records attached to the affidavit which demonstrate that the plaintiff took possession of the note on that date.
We agree with the defendant that the affidavit submitted by the plaintiff lacked a
sufficient evidentiary basis to demonstrate that the plaintiff possessed the note when it commenced this action. Grageda’s averments relating to the date that the plaintiff possessed the note are inadmissible hearsay and lack probative value because they are based on unidentified records (e.s.) which were not included with his affidavit (see Deutsche Bank Natl. Trust Co. v Dennis, 181 AD3d 864; Nationstar Mtge., LLC v Cavallaro, 181 AD3d 688; American Home Mtge. Servicing, Inc. v Carnegie, 181 AD3d 632; Bank of N.Y. Mellon v Gordon, 171 AD3d 197, 208-209). Since the plaintiff failed to meet its initial burden as the movant, the Supreme Court should have denied those branches of plaintiff’s motion which were for summary judgment on the complaint insofar as asserted against the defendant and to appoint a referee to compute the amount due to the plaintiff, regardless of the sufficiency of the defendant’s opposition papers (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853). (e.s.)
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.

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Expert Testimony and Expert Reports

Homeowners are dismayed and even claim court bias when the report of a self-proclaimed expert is barred from evidence. Or they become equally incensed when the court allows the report into evidence but gives it zero weight in rendering a decision. But the court is, to that extent, merely following the rules that govern what Judges should or should not do.

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It goes without saying that any report that has not been read and any testimony that has not been heard will be disregarded as a practical matter and in many cases as a legal matter. The Internet has been awash in offers of “magic bullet” analyses and reports that either directly or indirectly make the false promise of relief from foreclosure. Nearly all of the forensic analysts are self-proclaimed, unlicensed in any field requiring a license, inexperienced and untrained. What they are seem to share in common is the hope or belief that once a Judge lays eyes on the report, the decision will be rendered swiftly in favor of the homeowner.
Forensic analysis can theoretically be performed by anyone, which of course means that they are predominantly worthless even in their inception. Most analysts are looking for the wrong things and/or looking for things that are irrelevant and/or looking for things that will not be admitted into court record as evidence. Even an unopposed expert declaration or affidavit will either not be admitted into evidence by written report or oral testimony if it is delivered by such analysts. Homeowners are dismayed and even claim court bias when the report of a self-proclaimed expert is barred from evidence. Or they become equally incensed when the court allows the report into evidence but gives it zero weight in rendering a decision. But the court is, to that extent, merely following the rules that govern what Judges should or should not do.
The one thing in which most “successful” forensic analysts excel is selling. They tell homeowners what they want to hear when they need to hear it. It’s akin to imbibing a libation or drug to take the edge off for the moment but it doesn’t change a thing.
So let’s go to the other end of the spectrum. Does it matter if the analyst is unlicensed? NO. But if the analyst is unlicensed he or she will need to spend a lot more time giving testimony about how they acquired their expertise and how their work is based upon established frameworks of prior work in teases and other sources — and not merely a theory in their own head.
But the interesting thing is that when such experts do survive the challenges under Daubert or Frye (see below) the seemingly less qualified analyst frequently is able to explain to the court how he or she arrived at an opinion and then explains both the opinion and the basis of the opinion in clearer language than most “qualified” experts with far superior credentials.
Further the Banks’ Ostrich Strategy appears to have been working for the last 10 years. After tens of thousands of reports and expert declarations have been filed or served on behalf of homeowners, there are no reported instances in which an expert from the banks or servicers ever filed an affidavit or declaration in opposition to the experts who execute expert declarations for the homeowners. In fact, there are few instances in which the “expert” is even deposed, which thus removes the ability of the banks to challenge the expert. The end result has been that expert testimony is nearly always discounted or completely ignored. If the banks ignore it in litigation then so does the court.
But the unwillingness to make an issue of the expert declarations filed by homeowners may well have a downside, especially as more and more Motions for Summary Judgment are filed. As the courts are gradually changing course to consider the possibility that homeowners should win and that banks should lose, the time has come to file a motion for partial summary judgment on issues specifically raised and supported in a properly drafted expert declaration.
In the absence of an opposing affidavit, the court has little choice but to take the assertions as true as stated in the expert declaration for the homeowner. That leaves only the legal argument of whether the homeowner is entitled to the entry of summary judgment on the issues raised, inasmuch as the homeowner has effectively eliminated the issue or issues to be heard at trial.
For example suppose the expert’s opinion is that the trust was never funded, that the trust has no legal authority to administer the alleged loan because the loan was not in the trust, and that the trust therefore could never have purchased the debt or the note or the mortgage, and that the “servicer” appointed as servicer in the trust instrument (PSA) has no authority because the property (i.e., the loan) was never transferred into the trust and that the Trustee named in the trust instrument (PSA) also has no power over the subject loan because the trust never purchased the loan, the debt, the note or the mortgage, and perhaps also that the foreclosure is a grand illusion in which the banks and servicers are completing a scheme of civil theft of the investors’ money, and perhaps that the debtor-creditor relationship consists of the homeowner and the investors whose identities have been withheld by the banks.
In order to take those conclusions seriously, the court must hear that those conclusions are supported by understandable evidence that is based upon widespread axioms; since the conclusion is counterintuitive, it is important that the declaration be credible.
Hence the expert must bring in corroboration as part of the explanation of the reasoning in the expert declaration. Corroboration could be direct evidence (by the way, hearsay is allowed in expert testimony) or clear deductive reasoning that eliminates anything else as an alternative explanation; (e.g., if the trust had actually entered into a transaction in which it purchased the alleged loan or some part of it, then it would not assert that it was a holder but rather, as is custom and practice in the industry the trust would declare itself to be a holder in due course or the actual owner of the debt (not just the note and mortgage) and would gleefully have proven the purchase by offering a canceled check or wire transfer receipt into evidence).
By elimination of the elements of “good faith” and lack of knowledge of the borrower’s defenses (e.g. lack of consideration, non-merger of debt and note etc.) the only missing element would be that the Trust was not a successor to the original creditor regardless of whether the original creditor(s) was or were victims of theft or the actual payee on the note. Thus the conclusion that the Trust is not a holder in due course and should not be treated as one. And if it was the agent for an actual creditor, the Trust had failed to identify the creditors fro whom it was acting as agent. Note that such an admission would crash the entire trust and its beneficiaries under the weight of several violations of the Internal revenue Code turning all money handled by the “REMIC” into ordinary revenue and income.
One trick often used to bar such expert testimony is the 11th hour challenge either the day before or during trial. One New Jersey appellate court correctly assessed the situation has revealed in the following article:
Appeals Court Reverses Grant of “11th Hour” Motion to Strike Expert

Parties will frequently seek to strike the opinions offered by their adversaries’ experts as legally insufficient. While there are a variety of bases for such motions—including that the report does not set forth the “whys and wherefores” of the expert’s opinion, or that it does not satisfy other evidentiary rules for its admissibility—the strategic purpose is clearly to weaken or even destroy the opposing party’s case by barring key testimony. These limiting, or in limine, motions typically will be brought just before trial after the expert’s opinions have been discovered and often after the expert has given deposition testimony about the support for the opinion. A recent New Jersey Appellate Division case now seems to suggest that due process requires that (1) such a limiting motion must be made with enough time for the opponent to respond adequately, and (2) the trial judge must conduct a hearing prior to deciding to exclude the challenged expert’s opinions.

The issues arose in a lawsuit over a failed real estate deal, Berman, Sauter, Record & Jardim, P.C. v. Robinson, Dkt. No. A-5650-11T3 (App. Div., Nov. 17, 2016). The plaintiff law firm sued a seller claiming that it wrongfully breached a purchase agreement and caused the law firm’s loss of fees from the deal. The defendant seller then counterclaimed and filed a third-party claim alleging that the plaintiff and third-party defendant law firms had committed legal malpractice by failing to include an express termination clause in the purchase agreement, a claim supported by the opinion of a legal malpractice expert. The plaintiff law firm filed a pre-trial motion to strike the expert’s testimony because the expert did not explain the bases for his legal malpractice conclusion and his testimony was therefore an inadmissible “net opinion.” One week before trial, the pre-trial judge denied that motion “so that the trial judge can hear the testimony and determine whether the expert’s opinions—which seem to set forth the whys and wherefores at least in their reports—were [legally] sufficient[ ] . . .” Because the pretrial judge was not going to be available for the entire trial, a different judge presided over the trial. After jury selection, the trial judge decided to revisit the court’s prior in limine ruling on the expert. Without taking testimony, he concluded the expert had rendered a net opinion and thus excluded the testimony. Because the defendant was left without an expert to support its case, the trial judge also entered an order dismissing the legal malpractice claim and the remainder of the lawsuit quickly settled.

The Appellate Division reversed. The appeals court first noted that the motion to strike the expert was “nothing more than a thinly veiled summary judgment motion” because it essentially was dispositive of the defendant’s claims. The court recognized that the notice provisions for summary judgment motions were meant to satisfy due process by giving parties an opportunity to be heard at a meaningful time and in a meaningful matter. In addition to failing to provide the 28-day notice required for summary judgment motions, the motion did not give the “one week in advance of trial” notice required for an in limine motion, leaving the defendant with no opportunity to present written opposition. And, because the trial judge had not ruled on the earlier summary judgment motions in the case, he did not have the defendants’ opposition to that motion.

The appeals court held that the trial court should not have granted a motion that was dispositive of the plaintiff’s claim without holding a hearing under Rule 104 of the New Jersey Rules of Evidence. The trial court had decided the motion in a way that was “fundamentally unfair” to the defendant. Fairness required the trial court have conducted a hearing before “barring an expert’s testimony based upon a report, particularly if doing so will be dispositive of a case, when the expert has not had the opportunity to explain his opinions through testimony.” Slip op. at 10. The court left it to the trial court’s discretion whether to conduct the hearing before or during the trial.

The importance of the Berman, Sauter decision is that trial counsel can no longer leave to the last minute in limine motions that seek to exclude expert testimony or any other evidence that could be dispositive of the lawsuit. If trial counsel believes that expert’s opinions are inadmissible, it must give sufficient notice to the court and its adversary—and the Appellate Division suggested that it might not be enough just to comply with the one week notice provision if the in limine motion would have the same effect as a summary judgment motion. Berman, Sauter will make trial judges more likely to order pre-trial hearings when an in limine motion seeks to preclude the expert’s opinions and virtually a certainty if such a motion is made without the expert having given deposition testimony explaining his or her opinions.

Expert Declarations, Affidavits and Testimony

The fundamental problem is that while virtually anyone can be accepted as an expert, the weight given to their testimony is zero. The reason is simple. The author most often lacks any traditional credentials other than experience as a “forensic analyst” and their work product sounds pretty good to the homeowner but sounds like advocacy to the court, presented in confused form. Such “experts” should stay away from opinions on ultimate facts or law of the case and stick with the evidence — or absence of evidence — despite all their work in attempting to dig out the truth. Then they would be taken seriously. Until then, most experts will have little or no effect on most of the cases for which they were hired.


I have consistently stated in my expert witness seminars, writings and appearances that forensic analysts must be very careful NOT to call themselves experts in fields for which they lack qualifications and that it is far better to stay away from opinion evidence, which sounds like advocacy and lacks credibility, and stick with the facts that when presented carefully, might indeed hold sway with a court.I would add that for each time a forensic analyst gives testimony, there should also be n accountant who says “Yes, he/she used the correct standards.”
At this point most work done by most forensic analysts is between good and excellent —  but for their presentation — or at least that part that contains advocacy and opinions. Most have zero qualifications to really give opinions except MAYBE on the weight or quality of evidence. Their testimony has been thrown out of court or rejected because of this.

They would do much better by presenting FACTUAL findings as a forensic analyst and then applying instructions from counsel, answering the questions posed to them. Their graphs are meaningless to anyone other than people like me who already know the details. The Judges do not give any weight to such graphs and drawings because it comes off as advocacy instead of an independent expert.

They should state their qualifications which CAN include experience. Then they should state what questions have been posed to them. Then state the simple answer to the question. Then state the factual reason for the answer — something besides “everyone knows” or “it’s on the internet.”

The “expert” witness should state the work performed in coming to THAT SPECIFIC ANSWER. Don’t cross the line regularly into opinion evidence for which the witness has no qualifications to render an opinion — generally the witness is not an expert in banking practices, underwriting practices for loans or issuance of securities, bond trading, title, law, or accounting. If these witnesses would remove opinions their presentation would be much improved.

The way you get around opinions is to ask the right question. Instead of an opinion of who owns what loan, which the “expert” is not qualified to give they can still contribute without doing any different work. The witness  should be asked a question like “can you find any evidence to support the claim of XYZ that they are the owner of this loan?” or “Can you find any evidence that would identify the creditor in this transaction?” Then he/she could answer no, and tell the story about what standards were used, how and why those standards were applied, how he/she was given those standards to use, and how he/she tried to find the evidence but could not locate it and his/her opinion, as a forensic analyst for many years, that he/she has looked in all the places where one would expect to find such evidence. She therefore has concluded that notwithstanding the assertions of the XYZ company, there is no such evidence that would pass muster in the real world — in either a legal or accounting setting.

She could refer to the auditing standards of the FASB as what she used for guidance. Everything must be based upon some accepted standard. There is plenty of material there that says that what the banks are using in court is not acceptable in performing an audit and giving a clear opinion that the financial statements fairly represent the financial condition of the entity or their interest in an entity. Testimony from a CPA who performs audits verifying that the auditing standards she used were correct would go along way to giving the witness credibility.

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The Affiant who googled Bank of New York Mellon had “Standing”

By William Hudson

Just because you can thread a needle and replace the button on your shirt, doesn’t mean you should attempt your own vasectomy. Furthermore, just because you faithfully read LivingLies on a daily basis doesn’t mean you should organize a national Qui Tam foreclosure defense action. Despite the sophisticated knowledge necessary to testify about complex financial matters, The Bank of New York Mellon called on servicer Wells Fargo’s “loan verification analyst” to testify about the Bank’s standing on a note bearing a blank indorsement. The loan verification analyst testified that she had learned about the transfer through research she had done “on the internet” and furthermore claimed that “the internet will illustrate the transfer occurred in 2006.” Like I said, it might be best to leave the heavy-financial analysis to the experts.

In SOSA v THE BANK OF NEW YORK MELLON | FL 4DCA – the extent of the witness’s knowledge on the subject of standing and holder status is what she claims she learned from a search on “the internet.” Although this type of evidence is insufficient to establish a bank’s standing (as nonholder in possession with the rights of a holder in this particular case) the trial court thought otherwise. Sadly, millions of people have lost their homes because a bank “employee” with no personal knowledge and who didn’t possess the necessary expertise is allowed to testify on matters they are unqualified to testify upon. In Sosa, the witness didn’t even work for the Bank or servicer and was unable to describe the relationship between the parties.

Attorneys who fail to challenge the testimony of such a witness, fail to file a motion to strike or allow an Affidavit to stand that is proffered by an unqualified individual- are not defending their client’s interests. In light of this case it might be wise to remember that an affidavit or declaration used to support or oppose a motion must be made on personal knowledge, should set out facts that would be admissible in evidence, and show that the affiant or declarant is competent to testify on the matters stated. Specifically, an affidavit used to support or oppose a motion for summary judgment must be made on: a) personal knowledge b) must be based on facts that are admissible in evidence, and must c) show that the affiant or declarant is competent to testify on the matters stated in the affidavit.

Personal Knowledge
Absent personal knowledge, statements in an affidavit are hearsay and generally inadmissible as evidence. In the case of Sam’s Riverside, Inc. v. Intercon Solutions, Inc., 790 F. Supp. 2d 965 (S.D. Iowa 2011), outlines the significance of the personal-knowledge requirement for affidavit evidence in a trademark-infringement lawsuit. The judge in Sam’s Riverside rejected the plaintiff’s employee’s declaration that stated that Internet screen shots were true and accurate representations of certain web pages operated by the defendant because the affidavit did not establish the declarant’s personal knowledge of that information.



An employee testifying on behalf of a bank who glances at a computer screen does not possess the necessary personal experience to have an understanding of complex financial instruments as well as the private side of the mortgage transaction. The employee should be deposed and asked more than the usual, “Did you read the defendant’s account screen?” The court noted in Sam’s Riverside that the declaration did not state that the declarant had ever visited the web pages or that he had personal knowledge about the contents of the websites mentioned. Sam’s Riverside teaches that a good affidavit should not merely state that it is based on personal knowledge, but instead, it must show how the affiant obtained such personal knowledge. In the world of mortgage securitization- the people who created the system most likely couldn’t explain it to a judge, let alone an employee low on the totem pole.



It is well settled that statements in affidavits based “on information and belief” violate the personal-knowledge requirement of Rule 56(c). Other qualifying statements, however, like stating “to my knowledge” or “I believe,” cause confusion when assessing whether the personal-knowledge requirement is satisfied. Because of this “to my knowledge” qualifier, the court should hold that there is no admissible evidence to establish that most servicers own the debt and should be paid, let alone should summary judgment be issued in favor of a lender when the rules of evidence are not satisfied. Courts have uniformly ruled that the term “to my knowledge” is redundant and legally insignificant-especially when the bank employee has absolutely no knowledge about the complex financial transactions they are being called to testify upon.

Facts—Not Opinions
“‘The affidavit is no place for ultimate facts and conclusions of law.’” A.L. Pickens Co., Inc. v. Youngstown Sheet & Tube Co., 650 F.3d 118, 121 (6th Cir. 1981) (quoting 6 Moore’s Federal Practice, Part 2, ¶ 56.22(1) at 56-1316 (Supp. 1979)). Yet, too often an affidavit is based on opinions or false conclusions. An unqualified affiant’s opinion on legal questions should not be entitled to any weight whatsoever when it comes to testifying about a loan that was most likely never consummated and was securitized and delivered to a fictitious trust. Only the wire instructions or ledgers can legally demonstrated the transaction happened as reported. Unfortunately instead of compelling discovery so the homeowner can get to the actual facts, the homeowner will be stonewalled while the court relies on inaccurate and incompetent testimony in the form of a low-level bank employee.

Only when the testimony of an affiant is challenged by a knowledgeable attorney does the homeowner have a chance of refuting legal conclusions that are not supported by facts. Frequently, a judge will allow the bank employee to make legal conclusions or offer impermissible opinions, while the homeowner’s own attorney fails to defend against the false testimony. An affidavit, for example, should stay with the facts of a case. When an affiant declares, for example, that “the homeowner was in default” when there is no indication that the investor was not being paid by servicer advances, insurance proceeds or other coverage- the homeowner’s attorney must interject or forever let that testimony stand as fact.

Admissible Evidence
In federal courts, statements in an affidavit must be excluded if they do not comply with Federal Rules of Evidence. See:Reed v. Aetna Casualty and Surety Co., 160 F.R.D. 572, 575 (N.D. Ind. 1995). Hearsay statements in an affidavit are not admissible unless the statement complies with a recognized exception to the hearsay rule. A hearsay exception that is routinely used in morgage-tort cases is the business-record exception. Reliance on “business records” does not violate the personal-knowledge requirement, as long as the affiant is qualified to, and does, set forth the detailed foundation for the business-record exception to the hearsay rule. See Fed. R. Evid. 803(6). The issue in mortgage foreclosure cases is that the business records of loan servicers are seriously deficient as far as what is going on behind the scenes. Although the database may show the homeowner stopped paying, there is unlikely an actual default. The screenshot that banks usually rely as evidence is fatally defective and should be challenged. Until the attorney has the ledgers, confirmation that the servicer paid for the note, and other evidence nothing should be assumed. Relying on copies of documents that don’t exist- like notes that are created when the borrower goes into default should not be permissible.

The latest type of fraud on the court consists of the bank possessing a signature and other elements in a computer file that enable them to reconstruct a mortgage note that doesn’t actually exist until the loan goes into default. A technician than compiles the pieces together to recreate the note. The bank employee will then attest that they have in their possession the physical “wet-ink” note. When the homeowner compels the bank to see the note they claim to have in their possession, the note will then be reported lost. How convenient. It is much easier to explain away a lost note than it is to have actual evidence that a felony has been committed.

The affiant attesting to the foundation for the business-record exception should be compelled to explain how he or she obtained such knowledge and to explain indepth what the records mean starting at the beginning of the chain of assignments. The bank records, county records are often fabricated to create the illusion of assignment. However, if you look closely at the documents, inconsistencies can be found. It is also important that homeowners monitor affidavits submitted in their case. In a recent case the Lending Lies team is aware of, counsel for CitiMortgage altered an affidavit and forged an indorsement on a note contained in an appeal. Only after the judge based her ruling on the fraudulent Affidavit, did the homeowner discover that documents presented in the lower court had been altered and submitted in the appellee brief. The homeowner is proceeding with criminal charges against CitiMortgage and their counsel.

It is imperative that the homeowner and attorney leave no stone unturned in order to get to the “real story”. It is also important that both homeowner and attorney keep an eye on case documents to ensure the bank doesn’t resort to altering documents mid-trial. In most foreclosure defense cases the bank cannot meet the burden of proof if challenged and unless the judge accommodates an unqualified witness whose testimony will be used to foreclose on an unsuspecting homeowner.

Competent Witness
The affiant must establish that he or she is competent to lay the foundation or make the statements in the affidavit. See Fed. R. Evid. 602. Information regarding the affiant’s position with the company, job duties, and responsibilities, as well as that person’s knowledge of the company’s record-making and record-keeping practices should be documented. The witness should be examined on the company’s computer systems, how and when information is put into the computer system, and especially about the ledger, who the homeowner’s payments are forwarded to (if any) and if they are aware if the investors are being paid. Typically all a bank witness can testify about is a computer file containing information they have no control over.


Personal knowledge is often inferred by the judge based on an affiant’s position and the nature of the matters to which he or she testifies in the affidavit. For example, an employee who indorses mortgage notes as Vice President may be a contract employee with a rubber stamp. The majority of bank employees testifying on behalf of the bank are not competent to testify on complex legal and financial matters. An affiant’s personal knowledge and competence should not be presumed.


Challenging Affidavits
To challenge an affidavit that does not meet the standard requirements, requires that litigants file a motion to strike the affidavit in a timely manner and be specific as to the portions of the affidavit that are being challenged. See, e.g., Jones v. Owens-Corning Fiberglas Corp., 69 F.3d 712, 718 (4th Cir.1995). Failing to strike a motion waives your right to challenge the affidavit on appeal. This can be a fatal failure and all elements of an appeal should be vetted. An appeal that is too general can be struck. An affidavit made in bad faith or done to delay a case can result in an award including attorney’s fees (see: Fed. R. Civ. P. 56(h)). In the case of a fraudulent affidavit intended to deceive the court, sanctions and a judgment against the bank should be issued.

Merely alleging that documents have been robo-signed in order to obtain a new cause of action will not be granted, and attorneys who have attempted to do so have been unsuccessful. See, e.g., Me Lee v. LNV Corp., 2012 WL 1203403 (C.D. Cal. April 10, 2012-dismissing robo-signing allegations couched as an attempt to plead fraud claim). Singer v. BAC Home Loans Servicing, LP, 2011 WL 2940733, *2 (D. Ariz. July 21, 2011- holding that allegations of robo-signing do not constitute a plausible claim for relief). Homeowners must present more than bare allegations of ‘robosigning’ without any other factual support. Forensic document examiner Gary Michaels has built a successful practice finding document irregularities including digital alteration, forged signatures, metadata left on original documents and jpeg distortion that the naked eye cannot see. Again, when the homeowner obtains hard evidence of fraud, challenges bank affidavits and demands to see the actual evidence- the banks have a tendency to back down and start negotiating with the homeowner.

Obviously, it is critical for affidavit statements to be truthful, but it is equally important that the procedural aspects of obtaining evidence ensure its reliability and admissibility, especially with evidence that the banks are engaging in gross fraud to create the illusion of ownership through fraudulent documents and false affidavits. Banks that have taken shortcuts like the bank did in Sosa v. Bank of New York Mellon will lose if the affiant’s knowledge is challenged. Furthermore, banks that attempt to automate the process will eventually get sloppy and slip up if a competent foreclosure attorney authenticates documents, and attacks the witnesses qualifications. It is also important that an attorney ensure that the affiant is testifying on the documents submitted in the case, not a new set of documents that bank counsel slipped into the record unbeknownst to the homeowner. Conducting an investigation on the documents and affiant in a foreclosure case, now takes the skill of an attorney prosecuting a criminal. Also make sure the affiant has the documents properly notarized and that the affidavit is done under penalty of perjury.

In the case of Sosa v. Bank of New York Mellon, the judge ruled that the evidence submitted was not competent to establish the bank’s standing as nonholder in possession with the rights of the holder, but getting to this point took skill on the part of the attorney. Had the attorney allowed the affiant’s testimony to stand the homeowner would have lost on appeal. Judges May and Judge Gerber are judges that apparently understand that when the rule of law is followed the right party will prevail.
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Ken McLeod Files Complaints Against Notaries: 3 Licenses Revoked so far

So far he is three for three and he has no plans to stop filing complaints against notaries who signed false, fabricated affidavits. Ken McLeod (Arizona) is about the best investigator for economic crimes that I have ever come across. I won’t publish his number because the last time I did that he was swamped with calls and couldn’t do his work. If you can get to him, hire him. He has helped my law firm in a variety of ways sometimes tracking down witnesses within minutes and even telling us where they were standing at that moment. And he is devoted to bringing down this false system of foreclosures based upon false documents, false debts, and false testimony.

“The robo-signing notaries need to be stripped of their professional licenses.  I fully intend to file a complaint against every single notary who ever signed a false affidavit in Arizona.  It may take me years, but, this is how it’s done.  One at a time until they are all gone.

“Notice the Garcia revocation.  The notary presented after the fact falsified logs to try to cover his ass.  His other problems were accepting expired passports as proof of idea.  He even acknowledged the demand by a ‘detective’ but made a (wrong) legal decision he didn’t have to comply.

“Revocation of these commissions will have to be disclosed by these notaries any time they need a bond or apply for a government job.

The subtext for this is that if the notaries were committing crimes or violations of the rules and regulations governing their licenses as notaries, then two things are true: (1)  if a false notarization was affixed by a notary in order to record a document in public records or to authenticate an affidavit as testimony, then the document or affidavit needs to be expunged from the record or coupled with a notation that the affidavit or document was falsely notarized, and  (2) if the document was falsely notarized and is therefore not effective for the purpose for which it was improperly recorded, then any action based upon that recordation is void or voidable.

The one thing that I need to remind readers is that a false notary does not completely invalidate a document. It may invalidate the recording and it may imply that the entire document was false. But it doesn’t prove the entire document was false. For example, if you in fact signed a mortgage and a note and the mortgage was required to have two witnesses and a notary, you have a contract regardless of whether or not it was recorded.  The failure to provide the proper notarization does not nullify the instrument. When the notarization was not fraudulent, and affidavit attached to the instrument will suffice to correct the problem.

Luz Anaya Notary revocation letter from AZ SOS 09232013

Letter from AZ SOS revocation of notary commission Felix Garcia

Gloria Cramer AZ SOS Revocation Letterdated 1-20-2014

The Goal is Foreclosures and the Public, the Government and the Courts Be Damned

13 Questions Before You Can Foreclose

foreclosure_standards_42013 — this one works for sure

If you are seeking legal representation or other services call our South Florida customer service number at 954-495-9867 and for the West coast the number remains 520-405-1688. In Northern Florida and the Panhandle call 850-765-1236. Customer service for the livinglies store with workbooks, services and analysis remains the same at 520-405-1688. The people who answer the phone are NOT attorneys and NOT permitted to provide any legal advice, but they can guide you toward some of our products and services.


The selection of an attorney is an important decision  and should only be made after you have interviewed licensed attorneys familiar with investment banking, securities, property law, consumer law, mortgages, foreclosures, and collection procedures. This site is dedicated to providing those services directly or indirectly through attorneys seeking guidance or assistance in representing consumers and homeowners. We are available TO PROVIDE ACTIVE LITIGATION SUPPORT to any lawyer seeking assistance anywhere in the country, U.S. possessions and territories. Neil Garfield is a licensed member of the Florida Bar and is qualified to appear as an expert witness or litigator in in several states including the district of Columbia. The information on this blog is general information and should NEVER be considered to be advice on one specific case. Consultation with a licensed attorney is required in this highly complex field.

Danielle Kelley, Esq. is a partner in the firm of Garfield, Gwaltney, Kelley and White (GGKW) in Tallahassee, Florida 850-765-1236

EDITOR’S NOTE: SOMETIMES IT PAYS TO SHOW YOUR EXASPERATION. Danielle was at a hearing recently where all she wanted was to enforce a permanent modification for which her client had already been approved by Bank of America and BOA was trying to get out of it and pursue foreclosure even though the deal was done and there was no good or valid business reason why they would oppose a modification they already approved — except that they want to lure people into defaults and foreclosure to avoid liability for buy-backs, insurance, and credit default swap proceeds they received.

They need the foreclosure because that is the stamp of approval that the loans were valid and the securitization wasn’t a sham. Without the foreclosure, they stand to lose not only a lot of money in paybacks, but their very existence. Right now they are carrying assets that are fictitious and they are not reporting liabilities that are very real. At the end of the day, the public will see and even government officials whose “Services” have been purchased by the banks will not be able to deny that the nation’s top banks are broke and are neither too big to fail nor too big to jail. When that happens, our economy will start to recover ans the flow of credit and funds resumes and the banks’ stranglehold on government and on our society will end, at least until the next time.


 At the hearing against BOA on an old case of mine and Bill’s [William GWALTNEY, partner in GGKW] today I moved to enforce settlement. They actually agreed to a trial payment with my client in writing at mediation 2 years ago. The Judge granted the motion and wants a hearing in 60 days on the arrears (which he agreed my client isn’t liable for), sanctions and fees. She made her payment post-mediation and they sent the checks back. I gave him the Massachusetts affidavits from the BOA employees.  The Judge looked shocked. Opposing Counsel argued the Massachusetts case had nothing to do with our case.
Judge said “Mrs. Kelley how about I enter an order telling Plaintiff they have so many days to resolve this?”  I said “with all due respect your Honor BOA hasn’t listened to the OCC and followed the consent order, they haven’t listened to DOJ on the consent judgement and they are violating the AG settlement. I can assure you 100% they won’t listen to this Court either. Once we leave this room we are at the mercy of BOA actually working with us and their own attorney nor this court can get them to.  Their own attorney couldn’t reach them yesterday or today.  My client was to send in one utility bill two years ago. She sent it the day after mediation and they’ve sat and racked up two years of arrears and fees. This court has the power to sanction that behavior under rule 1.730 and should because this was orchestrated. The Massachusetts case is a federal class action which includes Florida homeowners like my client. It says Florida on the Motion for class certification so it does matter in this case. This was a scheme and a fraud.  It was planned and deliberate”.
Opposing counsel wanted to start the modification process over because the mediation agreement said “Upon completion of the trial payments Defendant will be eligible for a permanent modification”. Opposing counsel said “just because they meet the trial payments doesn’t mean they get a permanent mod.”  I said “under the consent judgment they better” and told the judge we were not going through the modification again, my client had already been approved. He agreed and said that the trial would become permanent and ordered BOA to provide an address for payment. He told opposing counsel that the argument that a trial period wouldn’t become permanent wasn’t going to work for him.
I love the 14th circuit. There is a great need from here to Pensacola and in the smaller counties like I was in today you can actually get somewhere.
Now the banks won’t even say impasse at mediation. It’s always “no agreement”.   But they’ll tell you to send in documents the next week only to say they didn’t get them. Now after those affidavits I see why.

Danielle Kelley, Esq.

Garfield, Gwaltney, Kelley & White
4832 Kerry Forest Parkway, Suite B
Tallahassee, Florida 32309
(850) 765-1236


BOA “SENIOR COLLECTOR”: “I lied because I was told to lie.”

Want to know why the blog is called “Living Lies”? Then read this:

see affidavit.boa3.djk

see also Memorandum to Certify Class: Editor’s Note: This is where the banks are at their most vulnerable.. They have gone to great lengths to create the illusion that they were modifying loans or even willing to do so when in fact what they really wanted and needed is a foreclosure sale to prevent them from getting hammered on liability for stealing the investors’ money and for diversion of both assets and money from the investors and from what would have been a benefit to borrowers. memotocertifyclass. I believe that there are monetary damages that could be awarded particularly when the pretender lender cannot come up with an allegation and proof of financial injury. Opportunities to sell or refinance the home were thwarted both by the pending foreclosure action and the negative credit reporting from non-creditors. People who have had their credit scores tanked by the pretender lenders should write to the credit reporting agencies and tell them that the report is false and fraudulent — that you never owed any money to the entity that entered the negative report.

Practice Hint: Get the name of the person and confirm their telephone, email, fax and physical address. Tell them you are recording the conversation for training purposes. And then record it.

This affidavit shows exactly why you need people are both lawyers and forensic computer experts to assist on most cases. Law firms lacking these resources and lacking private investigators, are not equipped well enough to do battle with these lying behemoths. If they are charging low fees just to sign you up, their chances are diminished that they can do anything besides delay a wrongful foreclosure instead of beating it.

This affidavit is an example of why the entire foreclosure process is going to unravel in the near future. Previously judges were resisting pleading, argument and discovery direct it at the credibility and truthfulness of affidavits and live testimony in court if they were submitted by a well-known bank or other institution supposedly acting on behalf of a bank. As time passed more and more judges were beginning to discern inconsistencies in the pleading and proof of the banks. But they still thought that the banks were most likely in possession of “the truth” and that any representation from the bank should be treated as credible whereas any representation from the borrower should be treated as dilatory at best.

Bank of America has taken the position that its house is totally in order. They even got the Atty. Gen. of the state of New York to back off of a lawsuit that was eventually filed only against HSBC. Danielle Kelly, Esq., of the firm of Garfield, Gwaltney, Kelley and White is writing an article about affidavits (in support of foreclosing) signed by people with no idea of what they contain (or knowing that they are lies), including the description of the signor as someone with authority to do so. You’ll see that article shortly, so I won’t belabor the point. I’ll simply quote the following from an affidavit of a supposedly senior person at BOA filed in United States District Court for the District of Massachusetts.:

Using the Bank of America computer systems I saw that hundreds of customers had made their required trial payments, sent the documents requested of them, but had not received permanent modifications. I also saw records showing that Bank of America employees have told people that  documents had not been received when, in fact, the computer system showed that Bank of America had received the documents. This was consistent with the instructions my colleagues and I were given. We were told to lie to customers and claim that Bank of America had not received documents it had requested, and that it had not received trial payments (when in fact it had). We were told that admitting that the bank received documents would “open a can of worms” since the bank was required to underwrite a loan modification within 30 days of receiving those documents and it did not have sufficient underwriting staff to complete the underwriting in that time…. Site leaders regularly told us that the more we delayed the HAMP modification process, the more fees Bank of America would collect. We were regularly drilled that it was our job to maximize fees for the bank by fostering and extending the lay of the … modification process by any means we could —  this included lying to customers. For example, we were instructed by our supervisors at Bank of America to delay modifications by telling homeowners who called in at their documents were “under review,” when, in fact, there had been no review or any other work done on the file.

Employees who were caught admitting that Bank of America had received financial documents or that the borrower was actually entitled to a permanent loan modification where discipline and often terminated without warning.

The only other thing that I would state at this point is that Bank of America did not merely lie to its customers. Bank of America makes a practice of lying to its own staff. While the use of a “nonperforming” loan are higher than the fees paid on a  “performing” loan, the real reason for this outrageous behavior is that the banks are attempting to protect and maintain their receipt of outrageous sums of money that they have declared to be proprietary trading profits. As I have stated before these banks are intermediaries. They are not and never were principals or real parties in interest in any transaction between the homeowner and the investors who put up the money.

As partial explanation of what I am talking about, consider this: you order a brand-new TV on Amazon using one of your many plastic cards. The vendor is (by way of example) Best Buy. Your account is debited $1000 which is exactly the amount you agreed to pay. Later, you find out that Best Buy accepted $600 for the TV and the intermediaries kept the other $400.  You also find out that during the shipping process the intermediaries took possession of the TV and intentionally dropped it 30 times to make sure that it wouldn’t work. During that process you learn that the intermediaries each paid for a contract of insurance using your money. Sure enough, the TV arrives in 1000 pieces. Each of the intermediaries receives full payment for the TV probably at the original purchase price of $1000. The intermediaries tell you that your problem is with Best Buy because that is the vendor in the transaction. Best Buy tells you that the TV was just fine when it left its distribution center and directs you to one of the intermediaries that handled either the shipment or the payment for the shipment. You are left going around in circles and you get worn out or you accept a settlement that is worth far less than the TV you purchased.

Now comes the fun part. The issuer of the credit card wants you to repay them $1000 at the end of the month or pay monthly installments with an interest rate of 24%. All you know is that you got screwed but you’re not entirely sure how that happened. The purpose of this blog is to educate you gradually on how you got screwed and why you are not a deadbeat; instead, you are a pawn in a very large Ponzi scheme.

Garfield, Gwaltney, Kelley & White

4832 Kerry Forest Parkway, Suite B

Tallahassee, Florida 32309

(850) 765-1236

More News:  – But they won’t go after Wells?  Makes a lot of sense

From Danielle Kelley, Esq. : The affidavits filed with the Court in Massachusetts by BOA and Urban employees are infuriating.   I particularly like the one that talks about the gift cards and $500 bonus payments to employees who had high foreclosure numbers and the one about the “Blitz” where as many as 1,500 modification applications would be denied several times a month based on production numbers whether the homeowners truly qualified for a modification or not. Selling out homeowners while collecting federal incentives to “pretend” to consider them for a federal modification program and then behind closed doors giving Target gift cards to employees who have high foreclosure numbers? 



COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary GET COMBO TITLE AND SECURITIZATION ANALYSIS – CLICK HERE


EDITOR’S COMMENT: One small step for mankind…. Requiring them to record any document relied upon in the chain of title to demonstrate their right to foreclose will not stop them, although it could slow them up a bit. The real piece here is the requirement of an affidavit, which is sworn under oath and establishes, with exhibits that the pretender is the party who can and should foreclose.

Who is going to sign it? With criminal charges pending against Wells Fargo and whistle-blowers headed for law enforcement to make deals, it seems unlikely that anyone will. But who knows? Upper management will never sign the affidavits unless they are sanitized to say virtually nothing, which then will put at issue whether the affidavit is sufficient. The lower paid robo-workers are not likely to do it unless they don’t realize what they are signing.

I think the most important part of this legislation is that it takes a baby step toward legislative mandate and recognition that something is going wrong in the courts and that Judges are going to at least notice that this happened. The real issue is shame —- those who feel it and those who cause it. Deep down most people seem to feel that they owe the money so they should lose their homes. They admit the default and they admit the payments were not made when in fact they have no idea whether or not the payments were made to the real creditor or if there is any creditor now because they were paid off.

I was explaining this yesterday and I used this analogy. Maybe this will help those who are being accused of seeking a free house when in fact they are seeking to protect their homes from thieves. If John  Smith snatches a woman’s purse in crowded jostling parking lot and then loans the money from the bag to you, who do you want to pay? Would you admit that you took the loan and agree to pay the criminal, John Smith, or would you say, wait, unless I know the money is going to the woman whose purse was snatched I’m not paying anything to reward the thief for his crime!


555 E. Washington Avenue, Suite 3900
Las Vegas, Nevada 89101
Telephone – (702) 486-3420
Fax – (702) 486-3283
Web –

DATE: September 29, 2011

Contact: Jennifer López


Las Vegas, NV – Nevada Attorney General Catherine Cortez Masto and Nevada Assembly Majority
Leader Marcus Conklin announced that the new ‘Foreclosure Fraud Reform’ law will take effect on
October 1, 2011.

“This new law helps protect Nevadans from improper foreclosures and protects the integrity of the
system for homeowners,” said Cortez Masto. “I was pleased to work with Majority Leader Conklin on
this important bill that creates security, legitimacy, and transparency in the foreclosure process.
Assembly Bill 284 will protect the Silver State’s housing market by ensuring homeowners and
prospective purchasers can get a clean chain of title and are treated more fairly.”

“There have been widespread instances of foreclosures based on false, improper or incomplete
documents throughout the nation over the past few years,” Conklin said. “This new law is part of our
ongoing commitment to prevent foreclosure fraud in our state and to ensure that the Attorney General
has the tools necessary to prosecute those who defraud homeowners.”

The bill gives Nevada residents access to information on the companies that hold their mortgages by
requiring the documents used in the foreclosure process to be recorded in the county where the
property is located. Additionally, the legislation requires a party seeking to foreclose in Nevada to
record a notarized Affidavit of Authority to Foreclose that includes information showing that the party
seeking to foreclose on the property has the legal right to exercise the power of sale. AB 284 also
strengthens the Attorney General’s enforcement authority over foreclosure fraud, and gives property
owners a new right of action to enforce their own legal rights in foreclosures.


Related posts:

  1. Nevada AG puts Bank of America on notice over Foreclosure Fraud Vegas Inc Call it Nevada’s version of David versus Goliath….
  2. Nevada Joins States Balking at Bank Releases in Foreclosure Practices Deal Bloomberg- A possible settlement of a 50-state probe of foreclosure…
  3. Nevada AG Masto opposes provision of settlement with big banks If your AG isn’t opposing the Foreclosure Fraud settlement, there’s…
  4. GA Foreclosure Fraud Bill Passes Out of House Committee HB 237, introduced by Representative Rich Golick, would prohibit misstatements…
  5. NEVADA ATTORNEY GENERAL SUES BANK OF AMERICA FOR DECEIVING NEVADA HOMEOWNERS Las Vegas: Attorney General Catherine Cortez Masto announced today that…

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– who has written 2465 posts on FORECLOSURE FRAUD | by DinSFLA.

CONTROL FRAUD | ‘If you don’t look; you don’t find, Wherever you look; you will find’ -William Black

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COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary GET COMBO TITLE AND SECURITIZATION ANALYSIS – CLICK HERE — EVIDENCE COUNTS!!!

“the Court will not participate in a process where OneWest increases its profits by disobeying the rules of this Court and by providing the Court with erroneous information


EDITOR’S COMMENT: We’ve been watching this for years. If one document doesn’t work, the pretender comes up with another “original” document. They are all fake, fabricated and forged. People have been asking us since 2007, “If what you are saying why are the Judges going along with it? Why are they not levying sanctions, referring the lawyers to the Bar for discipline and referring the banks to the justice system for criminal prosecution?” The simple answer is that the Judges didn’t believe it. They were stuck in the mental trap of believing that the banks would never intentionally do something in court that amounted to perjury, subornation of perjury and fraud. The Judges could not get their heads wrapped around the idea that the banks were in the process of a fraudulent land grab. It just didn’t make sense to them. It seemed far more likely to them, from their prior experience with foreclosures, that the process was largely clerical, that no bank would foreclose if there wasn’t a good reason and it couldn’t be worked out.

In California this attitude was particularly evident but in other states, Neil Garfield and Living lies was cited as the problem because we were filling the media with false statements of law and fact. Fast forward to the present and you see an increasing number of judges getting increasingly bold in switching their position on the banks and allowing for the possibility, even the probability that the homeowners win and the pretenders lose because they are pretenders, interlopers in a process meant to satisfy the requirements of judicial economy but which was being used (nonjudicial) to get around the basic requirements of black letter law and due process requirements contained in every state constitution and the United States Constitution.

Lawyers saw the references to me and my blog and the derisive wording about me, and they got scared that if they argued the same points they too would be the subject of derision, lose credibility with the court, and lose cases. And in fact, they were losing more cases than they were winning because even if they used the material on this blog, even if they got the COMBO title and securitization search, report and analysis that lays out everything chapter and verse, they were still losing — as a direct consequence of (a) Judges prejudging the cases and (b) the lawyers and litigants failing to object immediately as the first words were coming out of the mouths of the lawyers for the pretenders and failing to object to the first documents proffered. Most of all they were losing because they failed to deny the default, deny the right right of the forecloser to be initiating any collection or foreclosure proceeding, and deny that the originating papers were representative of the actual cash transaction that took place.

If you don’t object to an allegation, you are admitting it. If you don’t object to a document, it comes in as “evidence.” And the reason the lawyers were not objecting was that they had the same mindset as the Judges. How could they deny a default when they knew that the homeowner had not made payments on the note and mortgage that was attached as copies to the pleadings of the pretenders? If you don’t make the payments, you’re in default, right? WRONG! A default occurs only if the creditor fails to receive payment, not when the borrower decides to not make the payment. A default exists only if there is a gap in payments that are due, not payments that are shown on a piece of paper. If the payments were made anyway by a third party, there is no default and none can be declared.

And the declarer of the default must be someone who has an interest in the obligation. And the default must reference the obligation which normally is on the loan documents signed at closing but in the case of table funded loans that are enmeshed in a false securitization scheme, those documents do NOT set forth the terms or the parties involved in the transaction — so they can’t be used. If the loan documents at the so-called “closing” can’t be used we are left with an undocumented transaction between the homeowner, who is not known to the investor-lender, and the investors lender who is not known to the homeowner-borrower. They each got a separate set of documents including terms, conditions guarantees, cross collateralization, insurance and other third party payments (from servicers who keep paying in order to collect higher fees for “non-performing” loans. So in terms of documents there was no deal, and if the truth was told to both real parties in interest there wouldn’t have been a deal.

Nonetheless an obligation arose between the homeowner-borrower and the investor lender because the homeowner-borrower received the benefit of funding from the investor-lender, albeit under false pretenses including appraisal fraud at the loan level and ratings fraud at the investment level. The transaction is both undocumented and unsecured. And the obligation is subject to offset from a menu of affirmative defenses, rescission remedies, and counterclaims from the homeowners borrower. The property is now worth a small fraction of what was represented at the loan level closing and the investment level closing. So the investors are ignoring any remedies against homeowners because they don’t want to get tied up in litigation in which their net recovery is negative — i.e., they owe more to the homeowner than the homeowner owes on the obligation.

Enter the pretenders who figure that if the investors don’t want to go after the homes, then the banks will and who will challenge the banks since they appear to be the lenders in these transactions, even if they are not. Their defects in documentation and the facts (they were not included in the money trail of the loan transaction) were glossed over by lawyers and judges and even the media. Now, the Judges are taking a closer look and finding that not only do these pretenders lack standing, not only are they not the real parties in interest, but that that they and their lawyers are probably guilty of intentional fraud on the court and in this case, as well as others across the country, the Judge is ordering sanctions and fines.


IN RE ARIZMENDI | CA Bank. Court Denies Stay, Order to Show Cause “Contempt, Sanctions, (2) ONEWEST Notes; 1 Endorsed, 1 Unendorsed” “MERS Assignment”

In re: Jessie M. Arizmendi, Debtor.
OneWest Bank FSB, its assignees and/or successors, Moving Party,
Jessie M. Arizmendi, Debtor; Thomas H. Billingslea, Chapter 13 Trustee; and Indymac Mortgage Services, Junior Lien, Respondents.

Bk. No. 09-19263-PB13, RS No. CNR-2.

United States Bankruptcy Court, S.D. California.

May 26, 2011.

Not for Publication


LAURA S. TAYLOR, Bankruptcy Judge


Additional Briefing.

At the trial, the Court carefully considered the demeanor of the various witnesses and the testimony provided. In connection with the trial, the Court also reviewed all other evidence and argument appropriately before the Court. Notwithstanding, however, significant questions continued, and the Court required additional briefing in connection with several issues as outlined in the Order Setting Briefing Schedule, Outlining Preliminary Determinations, and Establishing Procedures for Final Resolution of Issues (Dkt. No. 56) (the “Briefing Order”).

OneWest’s post-trial documents provided the analysis and argument required by the Briefing Order. But, these documents also contained factual assertions inconsistent with the OneWest Declaration and the Claim. OneWest now provided a standing argument based on a new version of the Note (the “Endorsed Note”).[3] The Endorsed Note attached an allonge dated July 24, 2007 evidencing a transfer from Original Lender to “IndyMac Bank, FSB” and bore an endorsement in blank from IndyMac Bank F.S.B. OneWest argued in connection therewith that it had enforcement rights under the Endorsed Note as a holder notwithstanding the admittedly accurate testimony at trial indicating that OneWest is a servicer for Freddie Mac and not the secured creditor. The OneWest post-trial memorandum also references a separate agreement with Freddie Mac, but fails to further evidence or discuss this agreement. The OneWest post-trial memorandum, finally, bases a standing argument on physical possession of the Endorsed Note and OneWest’s alleged status as a trust deed beneficiary based on the Assignment.


But, there are key assumptions that the Court must make in order for this set of facts to withstand scrutiny. And they are that OneWest, in fact, holds the Endorsed Note and held the Endorsed Note at all appropriate points in time. Frankly, the Court is not willing to make such assumptions at this time. OneWest attached the Unendorsed Note to both its Proof of Claim and the Declaration. The Declaration stated under penalty of perjury, that the Unendorsed Note was a true and accurate copy of the Note held by OneWest. The Proof of Claim implicitly stated the same and OneWest, of course, is obligated to provide only accurate information in connection with its Proof of Claim. The problem is that the Unendorsed Note does not bear the endorsement or attach the allonge found on the Endorsed Note, a document produced only after trial and the close of evidence. One West, thus, leaves the Court with the quandary of guessing which promissory note OneWest holds, whether and when One West held the Endorsed Note, and what the explanation is for the failure to provide the Endorsed Note prior to the close of evidence.[10]

A further evidentiary anomaly arises on account of the Assignment; MERS executed this document as a nominee for the Original Lender. But the allonge to the Endorsed Note makes clear that the Original Lender assigned its interests in the Note more than three years prior to execution of the Assignment. And rights under the Trust Deed follow the Note. Polhemas v. Trainer, 30 Cal. 686, 688 (1866). Thus, MERS’ purported assignment of the Trust Deed and the related note as nominee for the Original Lender and without a reference to either IndyMac Bank, FSB or Freddie Mac appears designed to disguise rather than to illuminate the facts.

And finally, even if OneWest’s second post-trial discussion of standing and submission of evidence were accurate, one thing remains clear: OneWest failed to tell the true and complete story in the OneWest Declaration and in the Claim.

The Court is concerned, as a result, that OneWest does not hold the Endorsed Note. But, perhaps more significantly, the Court is concerned that OneWest has determined that business expediency and cost containment are more important than complete candor with the courts. On these points, Ms. Arizmendi has a right to be heard, and the Court has a right to explanation.

Further, this is not the first time that OneWest has provided less than complete information in the Southern District of California. See “Memorandum Decision Re Motion to Vacate Clerk’s Entry of Default and Motion to Dismiss Complaint; Order to Show Cause for Contempt of Court”, docket no. 39, Adv. Pro. 10-90308-MM (In re Doble; Bk. Case No. 10-11296) (Defendants, including OneWest, were neither candid nor credible in explaining failure to respond timely to complaint and submitted multiple and different notes as “true and correct”); “Order to Show Cause Why OneWest Bank, FSB and Its Attorneys Law Offices of Randall Miller and Christopher Hoo Should Not Appear Before the Court to Explain Why They Should Not Be Held in Contempt or Sanctioned”, docket no. 47, In re Carter, Bk. Case No. 10-10257-MM13 (among other things OneWest provides inconsistent evidence as to its servicer status); and “Order After Hearing to Show Cause Why Indymac Mortgage Services; OneWest Bank, FSB; Randall S. Miller & Associates, P.C.; Christopher J. Hoo; Barrett Daffin Frappier Treder & Weiss, LLP; and Darlene C. Vigil Should Not Appear Before the Court to Explain Why They Should Not Be Held in Contempt or Sanctioned”, docket no. 47, In re Telebrico, Bk. No. 10-07643-LA13 (Court concerned that OneWest provided evidence that was either intentionally or recklessly false).

The curious thing about these cases is that OneWest likely would prevail in each of them if it completely and candidly explained the basis for its motion and its standing in connection therewith. Undoubtedly, however, doing so is more costly than using a form declaration that is not customized as to the facts on a case by case basis and that is signed by an uninformed declarant. OneWest perhaps assumes that it really does not matter if the Court provides relief based on erroneous information. But, OneWest should remember an earlier theme in this decision and that is that the law is the law, rules are rules, and both must be obeyed. And, when it becomes clear that OneWest did not obey the rules, the Court can and, indeed, must act.

In short, the Court will not participate in a process where OneWest increases its profits by disobeying the rules of this Court and by providing the Court with erroneous information. The Court, thus, will take two steps. First, the Court will deny the Stay Motion without prejudice based first on the evidentiary problems that make it impossible for the Court to determine that OneWest is properly before the Court and that render evidence critical to OneWest’s prima facie case unreliable and second based on the Court’s inherent authority to regulate and control proceedings. Next, the Court hereafter will issue an order to show cause why One West should not be held in contempt and/or otherwise sanctioned. In connection therewith, the Court will consider a compensatory sanction to include a recovery of any costs Ms. Arizmendi would not have incurred but for OneWest’s improper actions. The compensatory sanction, frankly, could be quite limited. But, the Court also believes that a coercive sanction may well be appropriate. Given the orders to show cause that pre-date the one this Court will issue, it appears that the Court must create an economic disincentive for OneWest that will counter balance the economic benefit of a lack of complete candor. Further detail on the Court’s sanctions considerations will be set forth in the order to show cause and will not be further discussed here.

The Court finally notes that the order to show cause will issue only as to OneWest and possibly as to MERS. OneWest uses a variety of law firms. The Court was in a position to observe the demeanor of the lawyers handling this matter when the witness stated that OneWest was a mere servicer. The Court concludes based on this observation that they were unaware of this fact and unaware that OneWest supplied questionable documentary evidence. And frankly, there is nothing to be gained in pursuing the individual attorneys who must regularly appear in front of this Court. OneWest can simply change counsel and then be less than candid with a new set of attorneys.[11] The Court is interested in modifying OneWest’s behavior at an entity level, and any coercive sanction will be designed to achieve the same.


Based on the foregoing, the Stay Motion is denied without prejudice to the right of OneWest to refile a stay relief motion. In so doing, OneWest must provide declaratory evidence that explains when and how it obtained physical possession of the Endorsed Note and/or Unendorsed Note and that otherwise provides case specific evidence of standing given its servicer status.


COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary GET COMBO TITLE AND SECURITIZATION ANALYSIS – CLICK HERE

The fact that the true creditor doesn’t want to collect from homeowners is not a good reason to allow someone else to collect it. — Neil Garfield

FORECLOSURE CASE LAW – HSBC v. MURPHY, Maine Supreme Judicial Court, 2011 ME 59 (May 19, 2011)



“We have also repeatedly emphasized that a party’s assertion of material facts must be supported by record references to evidence that is of a quality that would be admissible at trial...This qualitative requirement is particularly important in connection with mortgage foreclosures where the affidavits submitted in support of summary judgment are commonly signed by individuals who claim to be custodians of the lender’s business records. Thus, the information supplied by the affidavits is largely derivative because it is drawn from a business’s records, and not from the affiant’s personal observation of events.” (e.s.)

“The foundation that the custodian or qualified witness must establish is four-fold:
(1) the record was made at or near the time of the events reflected in the record by, or from information transmitted by, a person with personal knowledge of the events recorded therein;
(2) the record was kept in the course of a regularly conducted business;
(3) it was the regular practice of the business to make records of the type involved; and
(4) no lack of trustworthiness is indicated from the source of information from which the record was made or the method or circumstances under which the record was prepared.

“Because we determine that the affidavits submitted by HSBC are inherently untrustworthy and, therefore, do not establish the foundation for admission of the attached documents as business records pursuant to M.R. Evid. 803(6), we vacate the judgment without reaching the substantive issues raised.”

“In Chase Home Finance LLC v. Higgins, 2009 ME 136, ¶ 11, 985 A.2d 508, 510-11, we stated that at a minimum, in support of any motion for summary judgment in a residential mortgage foreclosure action, the mortgage holder must include the following facts, supported by evidence of a quality that could be admissible at trial, in the statement of material facts:
•    the existence of the mortgage, including the book and page number of the mortgage, and an adequate description of the mortgaged premises, including the street address, if any;
•    properly presented proof of ownership of the mortgage note and the mortgage, including all assignments and endorsements of the note and the mortgage;
•    a breach of condition in the mortgage; •    the amount due on the mortgage note, including any reasonable attorney fees and court
•    the order of priority and any amounts that may be due to other parties in interest, including any public utility easements;
•    evidence of properly served notice of default and mortgagor’s right to cure in compliance with statutory requirements;
•    after January 1, 2010, proof of completed mediation (or waiver or default of mediation), when required, pursuant to the statewide foreclosure mediation program rules; and
•    if the homeowner has not appeared in the proceeding, a statement, with a supporting affidavit, of whether or not the defendant is in military service in accordance with the Servicemembers Civil Relief Act.”

It is, perhaps, stating the obvious that an affidavit of a custodian of business records must demonstrate that the affiant meets the requirements of M.R. Evid. 803(6)7 governing the admission of records…A business’s records kept in the course of its regularly conducted business may be admissible notwithstanding the hearsay rule if the necessary foundation is established “by the testimony of the custodian or other qualified witness.” M.R. Evid. 803(6). “A qualified witness is one who was intimately involved in the daily operation of the [business] and whose testimony showed the firsthand nature of his knowledge.”

EDITOR’S NOTE: There is no point of higher importance than that the evidence be heard and considered — and that it be tested for admissibility as evidence. This case artfully describes the process by which evidence is admitted. It also reveals the way the pretenders are avoiding the rules of evidence and getting away with it — until a court takes a close look.

The mistake in court that is replicated across the country is that lawyers, judges and pro se litigants are assuming evidence rather than going through the process of presenting it. The issue is not some technical two-step to avoid foreclosure. The issue is whether the requirements of law  have been met and therefore whether the party presenting itself as the would-be forecloser is in fact entitled to do so. Specifically, the mistake being made repeatedly is that lawyers are failing to object to affidavits that are inherently defective and failing to object to witnesses that either sign the affidavits or testify in court when they clearly do not possess the elements of a competent witness.

The reason they don’t have a competent witness is that their business records do not qualify for the business records exclusion to the hearsay rule. So they are merely presenting a warm body who tries to give the appearance of being a records custodian of records kept in the ordinary course of business and therefore carry a degree of credibility since they were not prepared for litigation.

That in fact is the opposite of what the banks have — they have only records prepared for litigation and no records that were kept in the ordinary course of business on any level, much less the chain of custody of records and knowledge, based upon actual transactions that were performed by the pretender. All the testimony and affidavits refer to transactions that did NOT involve the pretender forecloser. That is why this court, together with hundreds of courts across the country are coming to the conclusion that the affidavits are inherently defective (not credible), requiring an actual presentation of formal evidence in a trial or evidential hearing.

If the pretenders had the real goods, they would simply go forward with trials and presentation of formal evidence and the defenses and adversarial proceedings would quickly fade away as they won case after case on the evidence. But the truth is that the cases they are “winning” are without evidence and solely based upon presumptions and ignorance of the rules of evidence. Why is this important?

All this is important, because in a real trial, the pretender would have to allege and prove that it is a creditor who stands to lose money if they are not able to sell the home to mitigate their damages. Their problem is that they have no damages, the original transaction with the homeowner was fatally defective BECAUSE the pretenders wanted it to be that way and they figured they could get away with it. So far they are right. In most cases, the homeowner walks away without realizing his mortgage doesn’t exist, and the note is void, and that the obligation arising out of the funding of his loan is either paid, or the true creditor is more interested in collecting from the investment banker who sold garbage mortgage bonds than in trying to collect from individual homeowners. The fact that the true creditor doesn’t want to collect from homeowners is not a good reason to allow someone else to collect it.

Think about it. If the mortgages were valid, if the notes were enforceable, if the loans were properly underwritten, if the obligation of the homeowner was properly disclosed and linked with the investor lender — there would be no issue. In fact, there probably would be no foreclosures because the loans would have been viable and those that were not, would have been modified or settled. If the situation was “just a matter of paperwork” the paperwork would be cleaned up. But it isn’t. There are two primary ways to clean up the paperwork — go to the borrower and get a new signature or go to court and force the borrower to accept the new paperwork since the intent of the parties and the identification of the parties and the terms of transaction are clear as crystal.

The absence of any proceedings that would clean up the supposed paperwork mess gives rise to the obvious presumption that the banks, with their legions of smart lawyers, have not chosen to pursue those easy remedies. The only reason they would not choose a remedy that would clearly remove any doubt as to the validity of the loans and the truth of a default or delinquency is that they know they would lose if they had to present admissible evidence in court. In plain language they obviously know the loans are defective and paid in full and that they can’t win in court except by cheating. So they put a moral tag on it that the obligation is moral issue and that even if it is already paid off, and even if the the obligation a rose as a result of a fraudulent scheme, it should still be paid again. Is this any way to run a country?


COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary SEE LIVINGLIES LITIGATION SUPPORT AT LUMINAQ.COM

EDITOR’S NOTE: WISCONSIN COURT GETS IT: HEARSAY, PROOF, HOLDER NOT THE SAME AS CREDITOR, ETC. AFFIDAVIT THROWN OUT FOR LACK OF PERSONAL KNOWLEDGE. In short everything we have been saying here was followed by the Court. Expect more decisions like this coming from other states.

In other words, false papers and representations by counsel are no substitute for good old-fashioned proof. And proof is what the pretenders don’t have which is why they are pretenders — and losers. The parties initiating foreclosures, declaring the defaults, denying modifications, and buying the home at auction with a “credit bid” are and always have been tricksters who have now screwed up at least 10 million real estate transactions and probably closer to 100 million real estate transactions. These are the people who received the bailout, while the buyers of empty bogus mortgage bonds and the owners of homes with undocumented loans looked on in disbelief.

The great securitization scam, the appraisal fraud, the predatory lending and the TILA violations are coming to light in a wave that possibly not even the trillion dollar banking oligarchy can stop. This case is one of dozens of examples.









APPEAL from a judgment of the circuit court for Rock County:

JAMES WELKER, Judge. Reversed.

Before Vergeront, P.J., Lundsten and Blanchard, JJ.

¶1 LUNDSTEN, J. This appeal involves a foreclosure action initiated by Aurora Loan Services against David and Nancy Carlsen. Following a court trial, the circuit court granted judgment of foreclosure in favor of Aurora, finding that Aurora is the holder of the note and owner of the mortgage and that the Carlsens were in default. We conclude that the circuit court’s finding that Aurora was the holder of the note, a finding essential to the judgment, is not supported by admissible evidence. We therefore reverse the judgment.


¶2 Aurora Loan Services brought a foreclosure suit against David and
Nancy Carlsen, alleging that Aurora was the holder of a note and owner of a
mortgage signed by the Carlsens encumbering the Carlsens’ property. The
Carlsens denied several allegations in the complaint and, especially pertinent here,
denied that Aurora was the holder of the note. Aurora moved for summary
judgment, but that motion was denied.

¶3 A trial to the court was held on June 9, 2010. Aurora called one of
its employees, Kelly Conner, as its only witness. Aurora attempted to elicit
testimony from Conner establishing a foundation for the admission of several
documents purportedly showing that Aurora was the holder of a note that
obligated the Carlsens to make payments and that the Carlsens were in default. It
is sufficient here to say that the Carlsens’ attorney repeatedly objected to questions
and answers based on a lack of personal knowledge and lack of foundation, and
that the circuit court, for the most part, sustained the objections. Aurora’s counsel
did not move for admission of any of the documents into evidence. After the
evidentiary portion of the trial, and after hearing argument, the circuit court made
findings of fact and entered a foreclosure judgment in favor of Aurora. The
Carlsens appeal. Additional facts will be presented below as necessary.


¶4 It is undisputed that, at the foreclosure trial, Aurora had the burden
of proving, among other things, that Aurora was the current “holder” of a note
obligating the Carlsens to make payments to Aurora. Because Aurora was not the
original note holder, Aurora needed to prove that it was the current holder, which
meant proving that it had been assigned the note. There appear to be other failures
of proof, but in this opinion we focus our attention solely on whether Aurora
presented evidence supporting the circuit court’s findings that “the business
records of Aurora Loan Services show … a chain of assignment of that … note”
and that “Aurora is the holder of the note.”

¶5 As to assignment of the note, the Carlsens’ argument is simple: the
circuit court’s findings are clearly erroneous because there was no admissible
evidence supporting a finding that Aurora had been assigned the note. The
Carlsens contend that, during the evidentiary portion of the trial, the circuit court
properly sustained objections to Aurora’s assignment evidence, but the court then
appears to have relied on mere argument of Aurora’s counsel to make factual
findings on that topic. We agree.

¶6 We focus our attention on a document purporting to be an
assignment of the note and mortgage from Mortgage Electronic Registration
Systems to Aurora. At trial, this document was marked as Exhibit D. Although
Aurora’s counsel seemed to suggest at one point that certain documents, perhaps
including Exhibit D, were certified, the circuit court determined that the
documents were not certified. Under WIS. STAT. § 889.17,1 certified copies of
certain documents are admissible in evidence based on the certification alone.
Aurora does not contend that Exhibit D is admissible on this basis.

¶7 Aurora argues that Conner’s testimony is sufficient to support the
circuit court’s finding that Aurora had been assigned the note. Our review of her
testimony, however, reveals that Conner lacked the personal knowledge needed to
authenticate Exhibit D. See WIS. STAT. § 909.01 (documents must be
authenticated to be admissible, and this requirement is satisfied “by evidence
sufficient to support a finding that the matter in question is what its proponent
claims”). Relevant here, Conner made general assertions covering several
documents. Conner either affirmatively testified or agreed to leading questions
with respect to the following:

  • · She works for Aurora.
  • · She “handle[s] legal files” and she “attend[s] trials.”
  • · “Aurora provided those documents that are in [her] possession.”
  • · She “reviewed the subject file” in preparing for the hearing.
  • · She declined to agree that she is the “custodian of records for
  • Aurora.”

  • · She “look[s] at documentation … [does] not physically handle
  • original notes and documents, but [she does] acquire

  • · “Aurora [is] the custodian of records for this loan.”
  • · She is “familiar with records that are prepared in the ordinary course
    of business.”
  • · She has “authority from Aurora to testify as to the documents, of
    [Aurora’s] records.”

As it specifically pertains to Exhibit D, the document purporting to evidence the
assignment of the note and mortgage from Mortgage Electronic Registration
Systems to Aurora, Conner testified:

  • · Aurora has “possession of Exhibit D.”
  • · Exhibit D is “an assignment of mortgage.”

With respect to possession of Exhibit D, Conner did not assert that Exhibit D was
an original or that Aurora had possession of the original document. For that
matter, Conner did not provide a basis for a finding that any original document she
might have previously viewed was what it purported to be.2

¶8 Thus, Conner did no more than identify herself as an Aurora
employee who was familiar with some unspecified Aurora documents, who had
reviewed some Aurora documents, and who had brought some documents,
including Exhibit D, to court. Although Conner was able to say that Exhibit D, on
its face, was an assignment, she had no apparent personal knowledge giving her a
basis to authenticate that document. See WIS. STAT. § 909.01.

¶9 Aurora points to various provisions in WIS. STAT. chs. 401 and 403,
such as those relating to the definition of a “holder” (WIS. STAT.
§ 401.201(2)(km)), to a person entitled to enforce negotiable instruments (WIS.
STAT. § 403.301), and to the assignment of negotiable instruments (WIS. STAT.
§§ 403.203, 403.204, and 403.205). This part of Aurora’s argument addresses the
underlying substantive law regarding persons entitled to enforce negotiable
instruments, such as the type of note at issue here, but it says nothing about
Aurora’s proof problems. That is, Aurora’s discussion of the underlying law does
not demonstrate why Exhibit D was admissible to prove that Aurora had been
assigned the note and was, under the substantive law Aurora discusses, a party
entitled to enforce the note.

¶10 Similarly, Aurora discusses the relationship between a note and a
mortgage and, in particular, the equitable assignment doctrine. But here again
Aurora’s discussion fails to come to grips with Aurora’s failure to authenticate
Exhibit D, the document purporting to be an assignment of the note to Aurora.
Aurora points to testimony in which Conner asserted that Aurora acquired and
possessed Exhibit D, but possession of Exhibit D is meaningless without
authentication of the exhibit.

¶11 Aurora argues that we may look at the “record as a whole,”
including summary judgment materials, to sustain the circuit court’s factual
findings. Thus, for example, Aurora asks us to consider an affidavit filed with its
summary judgment motion. In that affidavit, an Aurora senior vice-president
avers that the note was assigned to Aurora, that the assignment was recorded with
the Rock County Register of Deeds, and that Aurora is the holder of the note. This
argument is meritless. Aurora was obliged to present its evidence at trial. It could
not rely on the “record as a whole” and, in particular, it could not rely on summary
judgment materials that were not introduced at trial. See Holzinger v. Prudential
Ins. Co., 222 Wis. 456, 461, 269 N.W. 306 (1936). For that matter, even if Aurora
had, at trial, proffered the affidavit of its senior vice-president, the affidavit would
have been inadmissible hearsay. See WIS. STAT. § 908.01(3) (“‘Hearsay’ is a
statement, other than one made by the declarant while testifying at the trial or
hearing, offered in evidence to prove the truth of the matter asserted.”).

¶12 In sum, Aurora failed to authenticate Exhibit D, the document
purporting to be an assignment of the note. Thus, regardless of other alleged proof
problems relating to that note and the Carlsens’ alleged default, the circuit court’s
finding that Aurora was the holder of the note is clearly erroneous—no admissible
evidence supports that finding. Aurora failed to prove its case, and it was not
entitled to a judgment of foreclosure.

By the Court.—Judgment reversed.


1 All references to the Wisconsin Statutes are to the 2009-10 version unless otherwise noted.

2 Our summary of Conner’s testimony omits several assertions Conner made that were
stricken by the circuit court. Similarly, we have not included examples of the circuit court
repeatedly sustaining hearsay and foundation objections. For example, the court repeatedly
sustained objections to Aurora’s attempts to have Conner testify that Aurora “owns” the note.
Aurora does not and could not reasonably argue that the Carlsens have not preserved their
authentication objections. The Carlsens’ attorney repeatedly and vigorously objected on hearsay,
foundation, and authentication grounds. The record clearly reflects that the Carlsens were
objecting to the admission of all of Aurora’s proffered documents on the ground that Conner
lacked sufficient knowledge to lay a foundation for admission.

JUDGE SCHACK| Dismisses Case With Prejudice Against Citibank Due To Counsel Failure To Comply

JUDGE SCHACK| Dismisses Case With Prejudice Against Citibank Due To Counsel Failure To Comply – 2011-01-11 11:33:03-05
Citibank, N.A. AS TRUSTEE FOR CERTIFICATEHOLDERS OF BEAR STEARNS ASSET BACKED SECURITIES TRUST 2007-SD3, ASSET BACKED CERTIFICATES, SERIES 2007-SD3, Plaintiff, against Santiago Murillo, et. al., Defendants 16214/08 Plaintiff: Megan B. Szeliga, Esq. and Jenneifer M. MCann, Esq., Steven J. Baum, P.C., Amherst, NY Defendant: Paul E. Kerson, Esq., Leavitt, Kerson and Duane, Forest Hills, NY Arthur M. Schack, […]


JUDGE SCHACK| Dismisses Case With Prejudice Against Citibank Due To Counsel Failure To Comply

JUDGE SCHACK| Dismisses Case With Prejudice Against Citibank Due To Counsel Failure To Comply



Santiago Murillo, et. al., Defendants


Plaintiff: Megan B. Szeliga, Esq. and Jenneifer M. MCann, Esq., Steven J. Baum, P.C., Amherst, NY

Defendant: Paul E. Kerson, Esq., Leavitt, Kerson and Duane, Forest Hills, NY

Arthur M. Schack, J.


The failure of plaintiff’s counsel, Steven J. Baum, P.C., to comply with two court orders, my November 4, 2010 order and Chief Administrative Judge Pfau’s October 20, 2010 order, demonstrates delinquent conduct by Steven J. Baum, P.C. This mandates the dismissal with prejudice of the instant action. Failure to comply with court-ordered time frames must be taken seriously. It cannot be ignored. There are consequences for ignoring court orders. Recently, on December 16, 2010, the Court of Appeals, in Gibbs v St. Barnabas Hosp. (___NY3d ___, 2010 NY Slip Op 09198), instructed, at *5:



Accordingly, it is

ORDERED, that the instant action, Index Number 16214/08, is dismissed with

prejudice; and it is further

ORDERED that the Notice of Pendency in this action, filed with the Kings

County Clerk on June 5, 2008, by plaintiff, CITIBANK, N.A. AS TRUSTEE FOR

CERTIFICATEHOLDERS OF BEAR STEARNS ASSET BACKED SECURITIES TRUST 2007-SD3, ASSET BACKED CERTIFICATES, SERIES 2007-SD3 to foreclose on a mortgage for real property located at 41 Hill Street, Brooklyn, New York (Block 4165, Lot 40, County of Kings), is cancelled and discharged.

This constitutes the Decision and Order of the Court.


J. S. C.


COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary


Editor’s Note: I usually advise lawyers that from the very first word that opposing counsel utters, an objection ought to be raised, because it is all a lie. A “living lie.” From the moment he states his name and then says whom he represents, you ought to have something on hand that questions the validity of whether he actually represents the party upon whose behalf he says he is making his appearance. It is usually in the rules that you can demand proof of authority to represent. I know of a few cases that ended up dismissed on those grounds alone because the attorney never came back, never called back and never filed anything.

The way you win these cases is by forming the intent to win it. You can’t form that intent unless you believe it. Believe it! These are all impostors, pretenders and people out to make a buck at the expense of the Court and your client. Don’t get lost in their narrative.

Remember that besides the monthly payment issue, you have a right to seek modification or settlement or to ask for an evidentiary hearing on the amount required for redemption — that requires an accounting from the creditor. How are you going to do that with the wrong party standing in the courtroom and a lawyer who does not even represent anyone? Judges are  latching on to this argument, because it makes sense to them. They are not absolving your client of liability but they will force the issue, and make sure the real deciders are present IF YOU AGGRESSIVELY PURSUE IT.

[NYSC] JUDGE SCHACK Tears up WaMU’s Counsel For “Defective Verification, Phony NY House Counsel” WAMU v. PHILLIP

Posted on02 December 2010. Tags: , , , , , , , , , , , , , , , , , ,

[NYSC] JUDGE SCHACK Tears up WaMU’s Counsel For “Defective Verification, Phony NY House Counsel” WAMU v. PHILLIP

Washington Mut. Bank v Phillip
2010 NY Slip Op 52034(U)
Decided on November 29, 2010
Supreme Court, Kings County
Schack, J.


Further, the verification of the complaint was not executed by an officer of WAMU, but by Benita Taylor, a “Research Support Analyst of Washington Mutual Bank, the plaintiff in the within action” a resident of Jacksonville, Florida, on June 4, 2008. This is the same day that Ms. Maio claims to have communicated with “Mark Phelps, Esq., House Counsel.” I checked the Office of Court Administration’s Attorney Registry and found that Mark Phelps is not now nor has been an attorney registered in the State of New York. Moreover, the Court does not know what “House” employs Mr. Phelps. [*5]

Both Mr. Phelps and Ms. Maio should have discovered the defects in Ms. Taylor’s verification of the subject complaint. The jurat states that the verification was executed in the State of New York and the County of Suffolk [the home county of plaintiff’s counsel], but the notary public who took the signature is Deborah Yamaguichi, a Florida notary public, not a New York notary public. Thus, the verification lacks merit and is a nullity. Further, Ms. Yamaguchi’s notarization states that Ms. Taylor’s verification was “Sworn to and subscribed before me this 4th day of June 2008.” Even if the jurat properly stated that it was executed in the State of Florida and the County of Duval, where Jacksonville is located, the oath failed to have a certificate required by CPLR


Ms. Maio should have consulted with a representative or representatives of plaintiff WAMU or is successors subsequent to receiving my November 9, 2010 order, not referring back to an alleged June 4, 2008 communication with “House Counsel.” Affirmations by plaintiff’s counsel in foreclosure actions, pursuant to Chief Administrative Judge Ann t. Pfau’s October 20, 2010 Administrative Order, mandates in foreclosure actions prospective communication by plaintiff’s counsel with plaintiff’s representative or representatives to prevent the widespread insufficiencies now found in foreclosure filings, such as: failure to review files to establish standing; filing of notarized affidavits that falsely attest to such review, and, “robosigning: of documents.

MERS-Deutsch Slammed on Quiet Title


MERS tried to Quiet Title. In so doing they paved the way for millions of homeowners to sue MERS to quiet title. The net result is that the encumbrance is invalid. That means the debt, the obligation, MIGHT exist, but it is NOT secured by the home. I’d say I told you so, but that would be immature. 🙂

All of that is important but Judge Jeffrey Arlen Spinner went a lot further and made his mark on the issue of bogus affidavits that say nothing but which are used by foreclosure mill attorneys who spout off about what the affidavit says or what it proves. Judge Spinner flatly says the affidavit would be insufficient even if MERS had an interest, which it does not. He clearly states the law which is valid not only in New York, but EVERY state and federal jurisidiction, but which has been ignored by a majority of judges until now:

To establish a claim of lien by a lost mortgage there must be certain evidence (e.s.) demonstrating that the mortgage was properly executed with all the formalities required by law and proof of the contents (e.s.) of such instrument. … Here Burnett’s affidavit simply states that the original mortgage is not in Deutsch Bank’s files, and that he is advised (e.s.) that the title company is out of business. Burnett gives no specifics as to what efforts were made to locate the lost mortgage…. More importantly, there is no affidavit from MLN by an individual with personal knowledge of the facts that the complete file concerning this mortgage was transferred to Deutsch Bank and that the copy of the mortgage submitted to the court is an authentic copy of Torr’s Mortgage.” (e.s.)

EDITOR’S NOTE: The importance of this decision and its citations cannot be over-stated. Now we are getting down to the nub of it. It isn’t enough for the  foreclosure lawyer to make empty allegations contained nowhere in pleadings, affidavit or proof. The foreclosure lawyer is seeking affirmative relief — enforcement of the note and sale of the property. If he can’t plead the case in good faith then he doesn’t belong in court. And if he does plead the case he must prove it within the boundaries of ordinary rules of evidence. A competent witness must exist who is wiling to testify under oath and who actually appears to do so. They musts possess PERSONAL knowledge (not what someone told them) of the facts about which they are going to testify. Business records exceptions are very restrictive as they prevent the other side from cross examining a live witness (a basic constitutional right of due process).

  • “Trust me” is not a substitute for real evidence.
  • If they want to prove the obligation, they need evidence.
  • If they want to prove a default, they need evidence,
  • if they want to prove the note is evidence of the obligation, they must prove that assertion with evidence that the note is the whole deal (which is NEVER the case in a securitized loan).
  • If they want to prove a lost note they need evidence that the note was in existence, when it was in existence, how it came into existence, and what happened to it — not just say we had it, but now we don’t.
  • And watch out for those “original notes.” Many of them are fabricated using simple software and a color printer. If there are no impressions on the back of the page, even the note they present is probably NOT the original and is probably a fabrication printed off a laser or dot matrix printer. Close examination will show even a novice the truth of this statement.




Judges Rising to the Rules

Editor’s Comment: Without inventing anything, an increasing number of Judges are coming to the same conclusion. If they apply the rules and deny the pretender lender the benefit of presumptions to which they were not entitled in the first place, the case can be heard on the merits. They don’t need to decide who is right or who is wrong. They need to call balls and strikes.

In this submission from the Judge simply states the obvious — an affidavit from some stranger who says that he looked at some papers and arrived at some conclusions in his or her own mind is not evidence or even a proffer of evidence. It is nonsense. Summary Judgment denied. Motion to lift stay should similarly be denied. Any motion based upon such an affidavit from EITHER side should be denied. AND NOW THEY ARE…..

I SHOULD ADD THAT THE NAME “ICE” ESQ. IS COMING UP MORE FREQUENTLY. I’D LIKE TO SEE MORE FROM THIS LAWYER. He seems to be talking the same tack as Gator Bradshaw in Central Florida (Ocala et al) , Jon Lindemen (S. Fla and Orlando), George Gingo (Northern Florida) and others, to wit: we are out to win these cases not just “mix it up” to justify the fees. Very gratifying to me. 3 years ago, nobody would listen. Now they are taking the ideas developed here, by Max Gardner and April Charney and taking it to the next level. I hope they leave us in the dust.

Full Hearing Transcript attached . Courtesy of T. Ice Esq. Palm Beach Florida

Florida – June 2010 – MSJ denied. Affidavits Hearsay Insufficient

What we are starting to see here is a pattern of Judges not excepting these affidavits from these robo-signers.

I can tell you that, if properly challenged, they will pull the affidavits across the board.

Don,t let that stop you from deposing these people, because once you do it will clearly show that they DO NOT have the authority to produce them. It will also show you they know absolutely nothing about the documents that they are signing even though they state it is of their personal knowledge.

Below is a transcript of how one Judge, in Palm Beach County, DENIED a motion for summary judgment on pending issues, including the insufficient affidavit.

Another key issue was an affidavit presented by the defense from Expert Witness Lynn Szymoniak regarding the fraudulent assignment presented in the case.

Lynn’s expert testimony has stopped many foreclosures in its tracks.

If you are interested in talking to Lynn about her services she can be reached at and just tell her 4closureFraud sent ya…

Some excerpts from the transcript…



THE COURT: Okay. Without going into
anything else, I’m not about to enter a motion –
granting a motion for summary judgement based onan affidavit of Mr. Reardon.
MR. CHANE: Your Honor, there is simply no — there’s no basis to –
THE COURT: I’m sorry. It’s just — it
basically just says he looked at some records. I
don’t know what he looked at and he plugged some
numbers in.
MR. CHANE: Your Honor, it’s based on his
personal knowledge. That’s all he needs to do
according to the Rule.
THE COURT: Well, motion denied.
MR CHANE: On what basis, Judge?
THE COURT: On the basis that the Court
fears that there are many issues of fact to be
determined. This is not a matter in which
everything is undisputed.
MR. CHANE: What issues of fact?
THE DEPUTY: Sir, the Judge ruled. The
hearing is over.



Judge Bashes Bank in Foreclosure Case: “Criminal Probe in Florida.”

Judge Bashes Bank and Stern Law Firm in Foreclosure Case


A Florida state-court judge, in a rare ruling, said a major national bank perpetrated a “fraud” in a foreclosure lawsuit, raising questions about how banks are attempting to claim homes from borrowers in default.

The ruling, made last month in Pasco County, Fla., comes amid increased scrutiny of foreclosures by the prosecutors and judges in regions hurt by the recession. Judges have said in hearings they are increasingly concerned that banks are attempting to seize properties they don’t own.

The Florida case began in December 2007 when U.S. Bank N.A. sued a homeowner, Ernest E. Harpster, after he defaulted on a $190,000 loan he received in January of that year.

The Law Offices of David J. Stern, which represented the bank, prepared a document called an “assignment of mortgage” showing that the bank received ownership of the mortgage in December 2007. The document was dated December 2007.

But after investigating the matter, Circuit Court Judge Lynn Tepper ruled that the document couldn’t have been prepared until 2008. Thus, she ruled, the bank couldn’t prove it owned the mortgage at the time the suit was filed.

The document filed by the plaintiff, Judge Tepper wrote last month, “did not exist at the time of the filing of this action…was subsequently created and…fraudulently backdated, in a purposeful, intentional effort to mislead.” She dismissed the case.

Forrest McSurdy, a lawyer at the David Stern firm that handled the U.S. Bank case, said the mistake was due to “carelessness.” The mortgage document was initially prepared and signed in 2007 but wasn’t notarized until months later, he said. After discovering similar problems in other foreclosure cases, he said, the firm voluntarily withdrew the suits and later re-filed them using appropriate documents.

“Judges get in a whirl about technicalities because the courts are overwhelmed,” he said. “The merits of the cases are the same: people aren’t paying their mortgages.”

Steve Dale, a spokesman for U.S. Bank, said the company played a passive role in the matter because it represents investors who own a mortgage-securities trust that includes the Harpster loan. He said a division of Wells Fargo & Co., which collected payments from Mr. Harpster, initiated the foreclosure on behalf of the investors.

Wells Fargo said in a statement it “does not condone, accept, nor instruct counsel to take actions such as those taken in this case.” The company said it was “troubled” by the “conclusions the Court found as to the actions of this foreclosure attorney. We will review these circumstances closely and take appropriate action as necessary.”

Since the housing crisis began several years ago, judges across the U.S. have found that documents submitted by banks to support foreclosure claims were wrong. Mistakes by banks and their representatives have also led to an ongoing federal criminal probe in Florida.

Some of the problems stem from the difficulty banks face in proving they own the loans, thanks to the complexity of the mortgage market.

The Florida ruling against U.S. Bank was also a critique of law firms that handle foreclosure cases on behalf of banks, dubbed “foreclosure mills.”

Lawyers operating foreclosure mills often are paid based on the volume of cases they complete. Some receive $1,000 per case, court records show. Firms compete for business in part based on how quickly they can foreclose. The David Stern firm had about 900 employees as of last year, court records show.

“The pure volume of foreclosures has a tendency perhaps to encourage sloppiness, boilerplate paperwork or a lack of thoroughness” by attorneys for banks, said Judge Tepper of Florida, in an interview. The deluge of foreclosures makes the process “fraught with potential for fraud,” she said.

At an unrelated hearing in a separate matter last week, Anthony Rondolino, a state-court judge in St. Petersburg, Fla., said that an affidavit submitted by the David Stern law firm on behalf of GMAC Mortgage LLC in a foreclosure case wasn’t necessarily sufficient to establish that GMAC was the owner of the mortgage.

“I don’t have any confidence that any of the documents the Court’s receiving on these mass foreclosures are valid,” the judge said at the hearing.

A spokesman for GMAC declined to comment and a lawyer at the David Stern firm declined to comment.

Write to Amir Efrati at

Foreclosure Defense: New York Judge Gets It HSBC v Valentin N.Y. Sup., 2008

Also submitted by:

Editor’s Note: For those who are dubious about the legal positions and theories suggested in this blog, this case will be at least somewhat instructive. It is not just a technicality. It is reality. Nobody on the lender’s side can actually trace your note and mortgage to the real party in interest or anyone with actual personal knowledge of the assignments or the effect of those assignments.

This goes directly to the the issue of denying that payment was not made and the affirmative defense that the entire mortgage was prepaid by a third party who does not have any security rights in the property, was not disclosed to the borrower, and who possesses other assignments and cross guarantees through which payments were made, part of which was attributable to the revenue that was assigned.

Note that the note itself has vanished in most cases, has not been assigned and neither has the mortgage. This is a picture of “smart” people eviscerating the “asset” from which an ABS supposedly derived its value thus hoisting a crowd of people up on their own petards.


HSBC BANK USA, N.A., as Indenture Trustee for the Registered Noteholders of Renaissance Home Equity Loan Trust 2005-3, Renaissance Home Equity Loan Asset-Backed Notes, Series 2005-3,, Plaintiff, v. Candida VALENTIN, Candide Ruiz, et. al., Defendants. No. 15968/07. Jan. 30, 2008. Vincent P. Surico, Esq., De Rose & Surico, Bayside, for Plaintiff. No Opposition submitted by defendants to plaintiff’s Judgment of Foreclosure and Sale. ARTHUR M. SCHACK, J. *

1 Plaintiff’s application, upon the default of all defendants, for an order of reference, for the premises located at 572 Riverdale Avenue, Brooklyn, New York (Block 3838, Lot 39, County of Kings) is denied without prejudice. The “affidavit of merit” submitted in support of this application for a default judgment is not by an officer of the plaintiff or someone with a power of attorney from the plaintiff.

Leave is granted to plaintiff, HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2005-3, RENAISSANCE HOME EQUITY LOAN ASSET-BACKED NOTES, SERIES 2005-3 (HSBC), to renew its application for an order of reference upon presentation to the Court of compliance with the statutory requirements of CPLR § 3215(f), with “an affidavit of facts” executed by someone who is an officer of HSBC or has a valid power of attorney from HSBC.

Further, the Court, upon renewal of the application for an order of reference requires a satisfactory explanation to questions with respect to: the assignment of the instant nonperforming mortgage loan from the original lender, Delta Funding Corporation to HSBC Bank; the employment history of one Scott Anderson, who assigned the instant mortgage to HSBC, yet in a case I decided last month, HSBC Bank, N .A. v. Cherry, 18 Misc.3d 1102(A), swore in an affidavit to be HSBC’s servicing agent; and the relationship between HSBC, Ocwen Federal Bank, FSB (OCWEN), Deutsche Bank and Goldman Sachs, who all seem to share office space at 1661 Worthington Road, Suite 100, West Palm Beach, Florida 33409 (Suite 100). Background Defendants, Candida Valentin and Candide Ruiz, borrowed $340,000 from Delta Funding Corporation, on June 23, 2005.

The note and mortgage were recorded in the Office of the City Register, New York City Department of Finance on July 14, 2005, at City Register File Number (CRFN) 2005000395517. Delta Funding Corporation, by MortgageElectronicRegistrationSystems, Inc. (MERS), its nominee for the purpose of recording the mortgage, assigned the note and mortgage to plaintiff HSBC, on May 1, 2007, with the assignment recorded on June 13, 2007 at CRFN 2007000306260.

Plaintiff’s moving papers for an order of reference fails to present an “affidavit made by the party,” pursuant to CPLR § 3215(f). The application contains an April 23, 2007-affidavit by Jessica Dybas, who states that she is “a Foreclosure Facilitator of OCWEN LOAN SERVICING, LLC, servicing agent and attorney in fact to the holder of the bond and mortgage sought to be foreclosed herein.”On that date, the note and mortgage were still held by MERS, as nominee of Delta Funding Corporation. For reasons unknown to the Court, MERS, as nominee of Delta Funding Corporation, or plaintiff HSBC failed to provide any power of attorney authorizing OCWEN to go forward with the instant foreclosure action.

Further, even if HSBC authorized OCWEN to be its attorney in fact, Ms. Dybas is not an officer of OCWEN. She is a “Foreclosure Facilitator,” a job title unknown to this Court. Therefore, the proposed order of reference must be denied without prejudice. Leave is granted to plaintiff HSBC to comply with CPLR § 3215(f) by providing an “affidavit made by the party,” whether by an officer of HSBC or someone with a valid power of attorney from HSBC. *2 Further, according to plaintiff’s application, the default of defendants Valentin and Ruiz began with the nonpayment of principal and interest due on January 1, 2007. Yet, four months later, plaintiff HSBC was willing to take an assignment of the instant nonperforming loan. The Court wonders why HSBC would purchase a nonperforming loan, four months in arrears?

Additionally, plaintiff HSBC must address a third matter if it renews its application for an order of reference. In the instant action, as noted above, Scott Anderson, as Vice President of MERS, assigned the instant mortgage to HSBC on May 1, 2007. Doris Chapman, the Notary Public, stated that on May 1, 2007, “personally appeared Scott Anderson, of 1661 Worthington Road, Suite 100, West Palm Beach, Florida 33409.”In HSBC Bank, N.A. v. Cherry, at 3, I observed that: Scott Anderson, in his affidavit, executed on June 15, 2007, states he is Vice President of OCWEN. Yet, the June 13, 2007 assignment from MERS to HSBC is signed by the same Scott Anderson as Vice President of MERS. Did Mr. Anderson change his employer between June 13, 2007 and June 15, 2007. The Court is concerned that there may be fraud on the part of HSBC, or at least malfeasance. Before granting an application for an order of reference, the Court requires an affidavit from Mr. Anderson describing his employment history for the past three years. Lastly, the court notes that Scott Anderson, in the MERS to HSBC assignment gave his address as Suite 100. This is also the address listed for HSBC in the assignment. In a foreclosure action that Idecided on May 11, 2007 (Deutsche Bank Nat. Trust Company v. Castellanos, 15 Misc.3d 1134[A] ), Deutsche Bank assigned the mortgage to MTGLQ Investors, L.P. I noted, at 4-5, that MTGLQ Investors, L.P.: According to Exhibit 21.1 of the November 25, 2006 Goldman Sachs 10-K filing with the Securities and Exchange Commission … is a “significant subsidiary” of Goldman Sachs…. [T]he January 19, 2007 assignment has the same address for both the assignor Deutsche Bank and the assignee MTGLQ Investors, L.P., at 1661 Worthington Road, Suite 100, West Palm Beach, Florida 33409.

The Court will not speculate about why two major financial behemoths, Deutsche Bank and Goldman Sachs share space in a West Palm Beach, Florida office suite In the instant action, with HSBC, OCWEN and MERS, joining with Deutsche Bank and Goldman Sachs at Suite 100, the Court is now concerned as to why so many financial goliaths are in the same space. The Court ponders if Suite 100 is the size of Madison Square Garden to house all of these financial behemoths or if there is a more nefarious reason for this corporate togetherness.

If HSBC seeks to renew its application for an order to reference, the Court needs to know, in the form of an affidavit, why Suite 100 is such a popular venue for these corporations. Discussion Real Property Actions and Proceedings Law (RPAPL) § 1321 allows the Court in a foreclosure action, upon the default of the defendant or defendant’s admission of mortgage payment arrears, to appoint a referee “to compute the amount due to the plaintiff.”In the instant action, plaintiff’s application for an order of reference is a preliminary step to obtaining a default judgment of foreclosure and sale. (Home Sav. Of Am., F.A. v. Gkanios, 230 A.D.2d 770 [2d Dept 1996] ). *3 Plaintiff has failed to meet the requirements of CPLR § 3215(f) for a default judgment. On any application for judgment by default, the applicant shall file proof of service of the summons and the complaint, or a summons and notice served pursuant to subdivision (b) of rule 305 or subdivision (a) of rule 316 of this chapter, and proof of the facts constituting the claim, the default and the amount due by affidavit made by the party… Where a verified complaint has been served, it may be used as the affidavit of the facts constituting the claim and the amount due; in such case, an affidavit as to the default shall be made by the party or the party’s attorney. [Emphasis added]. Plaintiff has failed to submit “proof of the facts” in “an affidavit made by the party.”The affidavit is submitted by Jessica Dybas, “a Foreclosure Facilitator of OCWEN LOAN SERVICING, LLC, servicing agent and attorney in fact to the holder of the bond and mortgage sought to be foreclosed herein.”There must be an affidavit by an officer of HSBC or a servicing agent, possessing a valid power of attorney from HSBC for that express purpose. Additionally, if a power of attorney is presented to this Court and it refers to pooling and servicing agreements, the Court needs a properly offered copy of the pooling and servicing agreements, to determine if the servicing agent may proceed on behalf of plaintiff. (EMC Mortg. Corp. v. Batista, 15 Misc.3d 1143(A) [Sup Ct, Kings County 2007]; Deutsche Bank Nat. Trust Co. v. Lewis, 14 Misc.3d 1201(A) [Sup Ct, Suffolk County 2006] ).

Also, the instant application upon defendants’ default must be denied because even though it contains a verified complaint, the attorney’s verification is insufficient to meet the requirements of CPLR § 3215(f). The Court, in Mullins v. Di Lorenzo, 199 A.D.2d 218 [1st Dept 1993], instructed that “a complaint verified by counsel amounts to no more than an attorney’s affidavit and is therefore insufficient to support entry of judgment pursuant to CPLR 3215.”Citing Mullins v. Di Lorenzo, the Court, in Feffer v. Malpeso, 210 A.D.2d 60, 61 [1st Dept 1994], held that a complaint with not more than an attorney’s affidavit, for purposes of entering a default judgment “was erroneous and must be deemed a nullity.”Professor David Siegel, in his Practice Commentaries (McKinney’s Cons Laws of NY, Book 7B, CPLR C3215: 16) explains that Mullins v. Di Lorenzo is in point here. Perhaps the verified complaint can do service as an affidavit for various purposes within the litigation while the contest is on … but it will not suffice to put an end to the contest with as drastic a step as a default at the outset.It must be kept in mind that even an outright “affidavit” by the plaintiff’s attorney on the merits of the case-except in the relatively rare circumstances in which the attorney happens to have first-hand knowledge of the facts-lacks probative force and is usually deemed inadequate by the courts to establish the merits. A fortiori, a verified pleading tendered as proof of the merits would also lack probative force when the verification is the attorney’s. [Emphasis added ] *4 In Blam v. Netcher, 17 AD3d 495, 496 [2d Dept 2005], the Court reversed a default judgment granted in Supreme Court, Nassau County, holding that: In support of her motion for leave to enter judgment against the defendant upon her default in answering, the plaintiff failed to proffer either an affidavit of the facts or a complaint verified by a party with personal knowledge of the facts (seeCPLR 3215(f): Goodman v. New York City Health & Hosps. Corp. 2 AD3d 581 [2d Dept 2003]; Drake v. Drake, 296 A.D.2d 566 [2d Dept 2002]; Parratta v. McAllister, 283 A.D.2d 625 [2d Dept 2001] ). Accordingly, the plaintiff’s motion should have been denied, with leave to renew on proper papers (see Henriquez v. Purins, 245 A.D.2d 337, 338 [2d Dept 1997] ). (See Hazim v. Winter, 234 A.D.2d 422 [2d Dept 1996]; Finnegan v. Sheahan, 269 A.D.2d 491 [2d Dept 2000]; De Vivo v. Spargo, 287 A.D.2d 535 [2d Dept 2001]; Peniston v. Epstein, 10 AD3d 450 [2d Dept 2004]; Taebong Choi v. JKS Dry Cleaning Eqip. Corp., 15 AD3d 566 [2d Dept 2005]; Matone v. Sycamore Realty Corp., 31 AD3d 721 [2d Dept 2006]; Crimmins v. Sagona Landscaping, Ltd., 33 AD3d 580 [2d Dept 2006] ). Therefore, the instant application for an order of reference is denied without prejudice, with leave to renew.

The Court will grant plaintiff HSBC an order of reference when it presents: an affidavit by either an officer of HSBC or someone with a valid power of attorney from HSBC, possessing personal knowledge of the facts; an affidavit from Scott Anderson clarifying his employment history for the past three years and what corporation he serves as an officer; and, an affidavit by an officer of HSBC explaining why HSBC would purchase a nonperforming loan from Delta Funding Corporation, and why HSBC, OCWEN, MERS, Deutsche Bank and Goldman Sachs all share office space in Suite 100.

Conclusion Accordingly, it is ORDERED, that the application of plaintiff, HSBC BANK N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2005-3, RENAISSANCE HOME EQUITY LOAN ASSET-BACKED NOTES, SERIES 2005-3, for an order of reference for the premises located at 572 Riverdale Avenue, Brooklyn, New York (Block 3838, Lot 29, County of Kings), is denied without prejudice; and it is further ORDERED, that leave is granted to plaintiff, HSBC BANK N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2005-3, RENAISSANCE HOME EQUITY LOAN ASSET-BACKED NOTES, SERIES 2005-3, to renew its application for an order of reference for the premises located at 572 Riverdale Avenue, Brooklyn, New York (Block 3838, Lot 39, County of Kings), upon presentation to the Court, within forty-five (45) days of this decision and order, of: an affidavit of facts either by an officer of HSBC or someone with a valid power of attorney from HSBC, possessing personal knowledge of the facts; an affidavit from Scott Anderson, describing his employment history for the past three years; an affidavit from an officer of plaintiff HSBC BANK N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2005-3, RENAISSANCE HOME EQUITY LOAN ASSET-BACKED NOTES, SERIES 2005-3, explaining why plaintiff would purchase a nonperforming loan from Delta Funding Corporation and why plaintiff *5 HSBC BANK N.A., shares office space at Suite 100, 1661 Worthington Road, West Palm Beach, Florida 33409, with Ocwen Federal Bank FSB, MortgageElectronicRegistrationSystems, Inc., Deutsche Bank and Goldman Sachs. This constitutes the Decision and Order of the Court. N.Y.Sup.,2008. HSBC Bank USA, N.A. v. Valentin Slip Copy, 18 Misc.3d 1123(A), 2008 WL 239932 (N.Y.Sup.), 2008 N.Y. Slip Op. 50164(U) END OF DOCUMENT

Response to Defective Affidavit: Motion to Strike

Here is an example of a defective affidavit: defective-affidavit-of-indebtedness

Here is the analysis of how to respond:

In general the affidavit is insufficient because it does not satisfy the basic requirements of personal knowledge.
1. “Affiant is an employee:” Affiant should be an officer or otherwise identified as having a specific scope of employment that should be identified and described for the period starting with the loan closing up through the date of the affidavit.
2. “Of Plaintiff or Plaintiff’s servicing agent:” Now they are withholding what entity employs the affiant so there is no presumption that the affiant in fact has personal knowledge of anything, or if affiant has personal knowledge of everything involved in the loan transaction and payments.  Nor are they identifying or describing the function of either plaintiff or the servicing agent.
3. “Personally familiar”: Doesn’t mean personal knowledge. He probably got information from others (hearsay), and he does not identify himself as custodian of records for anyone on anything.
4. “The information is found in the servicing agent’s records”: So he might not employed by the servicing agent but he is swearing that the information is contained in their records. Hearsay, and lack of competence to testify because he is allowing that he might NOT have personal knowledge, which is the key component of a witness’ competency to testify — the four elements being oath or affirmation, personal knowledge, recall and the ability to communicate information that is relevant to the case from his personal knowledge and recollection. In addition there is no indication when the servicing agent began to service, who the servicing agent is, and whether they are still the servicing agent. And there is no indication of what information is tracked by the servicing agent — for example, does the servicing agent pay the holder in due course? who is the holder in due course? Since this loan was most likely securitized, what insurance, third party guarantees, reserves, cross collateralization and/or over collateralization payments have been made? Has the obligation been satisfied or assumed and assigned to a government sponsored entity, or in a bailout by the U.S. Treasury or Federal Reserve. Chances are the servicer can only say whether the maker of the note paid the servicer. The servicer cannot say and doesn’t know about third party payments on the note. He also cannot say whetehr paymentes were received by the payee or holder of the note by the borrower nor does he state the authority of the servicer to intermediate the payments.
5. “The entries are made”: How does he know that the entries are made and if so, by whom, under what authority and based upon what information. We already know he might be an employee of the Plaintiff and not the servicer. So he lacks competency to state anything about the business process or record keeping of the servicer.
6. “either people with first hand knowledge or…” if they didn’t have first hand knowledge then somehow they got information from people who had first hand knowledge. Really? who? And how would he know about any of it?
7.  “recording such entries is a regular practice of servicer or plaintiff”: Well, which is it? Which one is he saying has what information? He clearly is only saying that the records of only one company are involved, but he won’t say which one. What about the other one. Were payments made by borrower to one or the other or both? This second admission that there are two entities involved means at the very least that two affidavits are required — one from the servicer and one from the payee on the note. If the note has been assigned, then a third, fourth fifth etc affidavit needs to be executed by all those who have or ever had a claim to the revenue from the note.
8. “There is now due” Lack of foundation for all the above reasons. Affidavit is subject to Motion to strike.
9. The numbers stated as charges tot he account are unsubstantiated by copies of invoices or any other corroboration.

Foreclosure Defense: Lost Note Shananigans

Jose wrote:

Thanks for the input K, I filed for BK today pro se I was totally unable to find and attorney with the enough guts in Virginia to take on these crooked lenders. There also another issue in our wonderful state, there is a statute that allows for the lenders to provide a lost note affidavit, most of these affidavits are fraudulent, these lenders and servicers never saw or even received this documents, they are being signed and notarized in back room offices, and using them to foreclose on all these families that were lied and cheated of all their life savings. I poured more than $500,000 of my savings into our home, for these lenders to take me to the cleaners. What can realistically be done about these lost note affidavits, contest their validity?. I did my mortgage audit and that is the best tool I have found, most attorneys unfortunately are intimidated by the Rocket Docket here in Virginia.

EDITOR’S NOTE: The answer is that you don’t just ask for it you demand it. And if they don’t give it to you you sue them in your State Court and saying there are numerous misrepresentations that were made to you and then you issue a Request to Produce, along with interrogatories that demand identification of the person who signed the lost note affidavit and when they were hired and where the note was placed and the entire chain of custody.

You are right, most of those affidavit are bogus, signed by people who knew nothing about the closing. Don’t give up on finding a decent attorney. Keep looking. Whether young or old, you want someone who wants to take on the system and draw blood.

Good for you for getting the audit done. You took the right steps!!!


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