JDSupra: It isn’t the crime — it is the cover up

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Bryan G. Scott has written an excellent article that should be read in its entirety at http://www.jdsupra.com/legalnews/its-not-the-crime-its-the-cover-up-e-39616/

This article runs to the heart of the mortgage mess, the cover-up and the potential impact on past, present and future foreclosures in the application of statutes of limitation relating to causes of action for violation of the truth in lending act, statutory remedies, and common-law actions in negligence and fraud. Using law from construction defects suits, the author has identified key factors in challenging the defense of the statute of limitations.

Because of the obvious danger posed by dishonest defendants concealing defects to take advantage of the statute of repose, many state legislatures have enacted fraud exceptions to their statutes of repose. The North Carolina statute of repose explicitly excludes “any person who shall have been guilty of fraud, or willful or wanton negligence” in the course of improving real property, and further excludes any person who has “wrongfully concealed” the fraud or willful or wanton negligence. N.C. Gen. Stat. § 1-50(a)(5)(e). Establishing the fraud or willfulness or wantonness necessary to invoke this exception is a high standard and typically requires proving the contractor or developer deliberately covered or concealed defects that it knew or should have known of in conscious disregard of the eventual owner’s rights. Where the defendant’s actions do not rise to this level, the North Carolina statutory exception does not apply.

[EDITOR’S NOTE: We already know that the servicers, investment banks and originators committed various acts of forgery, perjury, fabrication, robo-signing and other things that NO BANK WOULD ACCEPT IF THEY WERE ON THE OTHER SIDE OF THIS ISSUE. They continue to hide the true facts, cover-up and otherwise obscure or wear down beleaguered homeowners. These are facts that lay solely within the care, custody and control of the banks who control the servicers and the trustees. The investors, trustees and borrowers are considered barred from even inquiring into the nonexistent transactions that lay at the base of the chain of fabricated documentation and the only way to get it is through illegal means that cannot be used in court or discovery which the courts won’t allow. In my opinion there are very few TILA violations where the statute of limitations should bar a claim because the basic facts of the loan contract have been withheld and intentionally misrepresented.]

The North Carolina Court of Appeals reaffirmed the application of equitable estoppel to construction defect disputes in its September 2014 decision in Trillium Ridge Condominium Association, Inc. v. Trillium Links & Village, LLC, No. COA14-183, ___ N.C. App. ___ (Sept. 16, 2014) (slip op.).

As explained in Trillium Ridge, equitable estoppel is available in proper cases under North Carolina law to bar a defendant from relying on either a statute of limitations or statute of repose. Equitable estoppel requires “(1) conduct on the part of the party sought to be estopped which amounts to a false representation or concealment of material facts; (2) the intention that such conduct will be acted on by the other party; (3) knowledge, actual or constructive, of the real facts.” White v. Consol. Planning, Inc. 166 N.C. App. 283, 305 (2004), disc. review denied, 359 N.C. 286 (2005). The party asserting the defense must have “(1) a lack of knowledge and the means of knowledge as to the real facts in question; and (2) relied upon the conduct of the party sought to be estopped to his prejudice.” Id. at 807. Furthermore, the plaintiff must have been induced to delay filing its legal action by the defendant’s misrepresentations. Jordan v. Crew, 125 N.C. App. 712, 720, disc. review denied, 346 N.C. 279 (1997).

REGISTER OF DEEDS JEFF THIGPEN (NC) AND JOHN O’BRIEN (MA): REQUIRE ALL PAST AND PRESENT MERS ASSIGNMENTS TO BE FILED

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GETTING CLOSER TO THE TRUTH

EDITORIAL COMMENT: Every day we take a little more lipstick off the pig and discover, of all things, A PIG! This is a basic challenge to Wall Street that is so simple and so right that there is nothing to do but obey — but they won’t. If all the MERS transactions are recorded, it would not only recover billions in unpaid recording and registration fees, but trigger other tax liabilities on Federal, State and Local levels. The whole REMIC exemption is based upon the REMIC vehicle being closed within 90 days.

Oops! Nearly all REMIC (SPV, TRUST) vehicles are still open (i.e., empty) after many years. And Wall Street’s fees taken under the cover of the REMIC transactions and hidden from all, would be painfully obvious resulting not only in monumental income tax liability but liability for fraudulent sale of securities, appraisal fraud on the property, RICO and many other causes of action too numerous to mention (see Causes of Action on left side of this Blog).

But that is just a dream. There is no way they can record all 80 million MERS transactions because many of them don’t actually exist. In the end, the issue is simple — are we going to sacrifice a system of title recordation in place for centuries with an exemption (get out of  jail free) card for Wall Street and thus create commercial chaos for decades or centuries to come? Or are we going to let the chips fall where they will? If the chips fall naturally, some people will make money and some people will lose money. Some people will be satisfied and some people will be mad as hell. That’s what happens in a free market, isn’t it?

All we are offered is POLICY argument that says POLICY is more important than the law. That has never been true in theory. But now the only way out for Wall Street is to make it true in theory as well as in practice. Abandoning the separate but equal powers of the judiciary and thus removing one leg of the three legged stool the founders created when they launched the USA would be the single most important element in the destruction of the country as it is presently constituted — causing a secession battle and the same problems that Russia had when stopped being the Soviet Union.

Basically Wall Street is saying “we went to all this trouble and expense to cheat and deceive you and we ought to be able to keep it. Screw you if you think you are getting any of it back.” The government is nodding its head like a head on a spring in the back seat of the car. The people are saying we want governance not pie-splitting. How this will all end up is going to be interesting and profound. Unless we apply the rule of law suggested simply by applying the requirement of recording transactions in a public registry, we will have about as much confidence in the stability of U.S. commerce as there is in any of the third world countries.

Every PONZI scheme fails. All efforts by Wall Street and the government controlled by Wall Street have failed to find an alternative way around the rule of law that doesn’t strike at the heart of our constitutional system. All the people who lose money in a PONZI scheme wish the scheme had gone on just long enough for THEM to get their money back and someone else to lose THEIR money. That’s where we are, folks, and the time to end every PONZI scheme is immediately before another person gets hurt.

These foreclosures are virtually all based on factually false and fraudulent representations, documentation, and premises. Practically none of the “mortgages” are legal and if any one of them was singularly the subject of a quiet title action, the homeowner would win on the merits, based upon the facts. It is only because of the volume of transactions that legislators and bureaucrats are scurrying around looking for a novel way out of this scam, because they are getting “benefits” from Wall Street. The requirement of recording, will expose the truth: (1) that the only real parties to the transaction are not present in any existing documents and (2) that the existing documents describe transactions that never actually took place. They can’t record these documents because most states make it a criminal offense to record, execute, witness or notarize fraudulent documents.

FOR IMMEDIATE RELEASE:

Greensboro, NC

April 7, 2011

Contact:

Jeff Thigpen, Guilford County Register of Deeds

Ph. 336-451-5300

Ph. 336-641-3239

jthigpe@co.guilford.nc.us

REGISTER OF DEEDS JEFF THIGPEN (NC) AND JOHN O’BRIEN (MA) ASK 50 STATE ATTORNEY GENERAL FORECLOSURE WORK GROUP TO REQUIRE ALL PAST AND PRESENT MERS ASSIGNMENTS TO BE FILED!

JOHN L. O’BRIEN, JR.                                                                                                          JEFF L. THIGPEN
Register of Deeds                                                                                                                    Register of Deeds

Commonwealth of Massachucetts                                                                            Guilford County, North Carolina
Phone: 978-542-1704                                                                                                           Phone: 336-451-5300
Fax: 978-542-1706                                                                                                                  Fax: 336-641-5778
website:
www.salemdeeds.com website: www.guilforddeeds.com

April 6, 2011

The Honorable Tom Miller
Iowa Attorney General
1305 E. Walnut Street
Des Moines IA 50319

Dear Attorney General Miller,

We appreciate your leadership in the mortgage foreclosure working group, as part of a coordinated national effort by states, to review the practice of “robo-signing” within the mortgage servicing industry.   We understand this investigation is nearing conclusion, but we want to implore you to act on a very important issue to homeowners across the country.

As County Land Record Recorders in Massachusetts and North Carolina, we have been gravely concerned about the role of the Mortgage Electronic Registration Systems (MERS) in not only foreclosure proceedings, but as it undermines the legislative intent of our offices as stewards of land records.   MERS tracks more than 60 million mortgages across the United States and we believe it has assumed a role that has put constructive notice and the property rights system at risk.    We believe MERS undermines the historic purpose of land record recording offices and the “chain of title” that assures ownership rights in land records.

As a result, we are asking as part of your probe, that this task force and the National Association of Attorney Generals require that all past and present MERS assignments of deeds of trust/mortgages be filed in local recording offices throughout the United States immediately.  Assignments are required by statute to be filed in Massachusetts, however they are not currently required to be recorded in North Carolina.   We feel, that it is important that the Registers of Deeds should have representatives at the table before any settlement is discussed or agreed to as it relates to MERS failure to record assignments and pay the proper fees.

This action would serve three specific purposes.   First, the filing of all assignments would help recover the chain of title that determines property ownership rights that has been lost and clouded over during the past 13 years because of the scheme that MERS has set in place.  Second, transparency and confidence in ownership rights would be restored and this would prevent the infringement upon those rights by others.   Third, this action would support a return to sound fundamentals in our economy between the financial services industry and public recording offices.

MERS has defended their practices by saying that they were helping the registries of deeds by reducing the amount of paperwork that needed to be recorded. This claim is outrageous.  This is help we did not ask for, nor was it help that we needed.  It is very clear that the only ones that they were helping were themselves. Over the past 10-12 years, recording offices across the United States have upgraded their internal and external technology to meet the demands of lenders, title underwriters, title searchers and citizens.  In fact, in 1998 the Southern Essex District Registry of Deeds in Massachusetts became the first registry of deeds to provide both document images and indices available to the public, 24 hours a day, free of charge on the world-wide-web. In doing so, the Registry received a Computerworld Smithsonian Award which recognized the innovative use of technology to benefit society. In 2009, the Guilford County Register of Deeds was given a Local Government Federal Credit Union Productivity Award by the North Carolina Association of County Commissioners for their technological innovations.  Nationally, over 93% of the public land records are up to date and current, according to Ernest Publishing.

As of today, there are over 600 recording jurisdictions, covering 43% of the US population that have incorporated an eRecording model into their document recording operations.   We believe these jurisdictions cover nearly 80% of the volume of assignments that should be recorded.  The remaining areas could be covered quickly, with legislation requiring such action by state legislatures.

Quite frankly, we believe this can and should be done.  It’s the right thing to do.

In the coming weeks, we will be working with our national organizations, the National Association of County Recorders, Election Officials and Clerks (NACRC) and the International Association of Clerks, Recorders, Election Officials, and Treasurers (IACREOT) to take the same position.   We are also sending a copy of this letter to the National Conference on State Legislatures (NCSL) and the National Association of Counties (NACO).

Thank you for your immediate attention.

Sincerely,

Jeff L.Thigpen
Guilford County Register of Deeds, NC

John O’Brien
Southern Essex District Registry of Deeds, MA

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SOURCE: Jeff Thigpen

Conservative NC Court of App: Power of Sale is Not Favored Under the Law

GET LOAN SPECIFIC RECORDS PROPERTY SEARCH AND SECURITIZATION SUMMARY

because a foreclosure under a power of sale is not favored in the law and must be “watched with jealousy,” see In re Foreclosure of Goforth Props., 334 N.C. at 375, 432 S.E.2d at 859 (internal quotation marks omitted), we must conclude that the evidence presented to the trial court was not sufficient to establish that the Note was payable to Deutsche Bank for Soundview, and so was not sufficient to support the trial court’s finding of fact that “Novastar Mortgage, Inc., . . . transferred and assigned its interest in the Note and Deed of Trust to Deutsche Bank National Trust Company, as Trustee for Soundview Home Loan Trust 2005-4 (`Lender’).”

Conservative NC Court of Appeals says “Show us the note!”

Today, June 07, 2010, 31 minutes ago | admin From Home Equity Theft Reporter:

Another trial court screw-up in a foreclosure action was recently reversed – this time by the North Carolina Court of Appeals, which ruled that a lender seeking to foreclose on a mortgage had failed to properly provide sufficient competent evidence that it was the holder of the promissory note secured by the mortgage. Accordingly, it ruled that the lender was not entitled to go forward with a foreclosure

sale.(1)

For the ruling, see In re Foreclosure of Adams, No. COA09-1455 (N.C.

App. June 1, 2010).

(1) An excerpt from the ruling (bold text is my emphasis, not in the original text):

[S]ince the photocopies of the Note and Deed of Trust presented to the trial court indicate that the original holder of both instruments was Novastar, not Deutsche Bank for Soundview, and since these photocopies do not indicate that Novastar negotiated, indorsed or transferred the Note to Deutsche Bank for Soundview, respondents contend the photocopied instruments alone were not sufficient to establish that Deutsche Bank for Soundview is the current holder of the Note.

We recognize that, in the present case, the testimony by affidavit from Ms. Smith, the assistant secretary of Deutsche Bank for Soundview——an out-of-state entity——as well as the in-person testimony offered by Ms. Cole indicated that Deutsche Bank for Soundview is the current holder of the Note and Deed of Trust. However, neither the in-person testimony from Ms. Cole nor the testimony by affidavit from Ms. Smith expressly showed that Novastar transferred or assigned its interest in the Note and Deed of Trust to Deutsche Bank for Soundview.

Moreover, as we discussed above, the photocopied Note and Deed of Trust, which were described in Ms. Smith’s affidavit as “exact reproductions” of the original instruments, do not show that the Note was indorsed, transferred, or otherwise made payable by Novastar, the original holder of the instrument, to Deutsche Bank for Soundview.

Thus, whereas the record in In re Foreclosure of Brown, 156 N.C. App. 477, 577 S.E.2d 398 (2003), also included an Assignment of Deed of Trust as evidence showing that the original holder of the note and deed of trust had assigned its interest in said instruments to the party seeking to foreclose on the respondent—borrowers, the record before the trial court in the present case contained no such additional evidence.

Accordingly, because a foreclosure under a power of sale is not favored in the law and must be “watched with jealousy,” see In re Foreclosure of Goforth Props., 334 N.C. at 375, 432 S.E.2d at 859 (internal quotation marks omitted), we must conclude that the evidence presented to the trial court was not sufficient to establish that the Note was payable to Deutsche Bank for Soundview, and so was not sufficient to support the trial court’s finding of fact that “Novastar Mortgage, Inc., . . . transferred and assigned its interest in the Note and Deed of Trust to Deutsche Bank National Trust Company, as Trustee for Soundview Home Loan Trust 2005-4 (`Lender’).”

Hating and Hate Speech

It’s important especially now in the political season. People become attached to their candidates in an emotional way. And in the heat of battle they come to despise the other candidates and the people who support them. Besides the obvious damage to our psyche and souls, there is another more practical negative consequence that hurts all of us.

Fear and Hating is the tool of politicians. It distracts us from morality and from exercising independent judgment based upon real facts, rather than sound bites that trigger our emotional “hate” response. The fact is that none of us really know what any of the candidates will do once in office. We don’t even know what emergencies they will confront. Thus having such iron-clad convictions that we exclude everything contrary to the views of “our” candidate, deprives us all of resources we need in a complicated and difficult world.

My basic rule of thumb when judging a candidate is whether he or she provokes me to think, ponder, and wonder how things could be better. I’m looking for someone who understands the nuances and complexities of the world and trusts me to consider the possibilities. The corollary is that a candidate who engages in attacks, in the politics of fear and hate, is one who cannot be trusted to do anything right for me. 

The fact that attack politics works is predictable. Most of us don’t have the time to consider ambiguity in our lives and we want someone “out there” to “just do it.” When we are on the run and we hear a sound bite how someone will fight for us, that’s all we need to know, or is it?

 

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