IN THE CIRCUIT COURT OF THE ELEVENTH JUDICIAL CIRCUIT,
IN AND FOR MIAMI DADE COUNTY, FLORIDA
HSBC BANK USA, NATIONAL
ASSOCIATION, AS TRUSTEE FR
FREMONT HOME LOAN TRUST 2005-
B,MORTGAGE-BACKED
CERTIFICATES, SERIES 2005-B,
Plaintiff,
vs.
JOSEPH T. BUSET A/K/A JOSEPH
THOMAS BUSET AND MARGARET
BUSET A/K/A MARGARET JEAN
BUSET, et. al.,
Defendant.
__________________________/
GENERAL JURISDICTION DIVISION
CASE NO.: 12-38811 CA 01
JUDGE: BEATRICE BUTCHKO
ORDER GRANTING DEFENDANT’S MOTION FOR INVOLUNTARY DISMISSAL
FOR UNCLEAN HANDS AND LACK OF SUBSTANTIAL COMPETENT EVIDENCE
AND
ORDER TO SHOW CAUSE WHY PLAINTIFF SHOULD NOT BE SANCTIONED
FOR FRAUD UPON THE COURT UNDER
THE COURT’S INHERENT CONTEMPT POWERS
THIS CAUSE having come before the Court for Trial on March 17 and 18, 2016, and the
Court having reviewed Defendant’s Motion for Sanctions Under the Court’s Inherent Contempt
Powers for Fraud Upon the Court, and being otherwise advised in the premises, it is hereupon:
ORDERED AND ADJUDGED that Defendant’s Motion for Involuntary Dismissal after
Trial is GRANTED for the following reasons:
I. The Court Finds Unclean Hands In Plaintiff’s Prosecution of This Action
That Bars the Equitable Relief of Foreclosure
1. The Florida Supreme Court has long recognized the maxim that in equitable
actions such as this foreclosure, “he who comes into equity must come with clean hands.” Bush
v. Baker, 83 So. 704 (Fla. 1920).
2. In Bush, the Florida Supreme Court instructed that the “principal or policy of the
law in withholding relief from a complaint because of ‘unclean hands’ is punitive in nature.”
3. The Court finds several examples of Plaintiff’s unclean hands that mandate
punitive action that affirmatively bars plaintiff’s entitlement to the equitable relief of foreclosure.
A. Unclean Hands Involving the Specific Endorsement and Assignment
of Mortgage That Both Reflect a Transaction that Never Happened
4. Plaintiff’s trial witness, Sherry Keeley, an Ocwen employee, gave extensive
testimony regarding the Assignment of Mortgage (AOM) that Ocwen prepared in June of 2012
and recorded in the Public Records of Miami-Dade County in July of 2012.
5. On its face, this AOM purports to document a sale of Defendant’s loan from
Mortgage Electronic Registration Systems, Inc (“MERS”) as nominee for the originator,
Freemont Investment and Loan, directly to the securitized trust identified as the plaintiff.
6. Ms. Keeley testified that Ocwen prepared this assignment in preparation for filing
the foreclosure complaint. The Ocwen employee identified the originator of the promissory note
and prepared the AOM to reflect a transfer from MERS, as Nominee of that originator to the
same party as Ocwen intended to name as Plaintiff in the foreclosure action.
7. The Court takes judicial notice that on July 25, 2008, Freemont Investment and
Loan (“Freemont”) entered into a voluntary liquidation and closing which did not result in a new
institution. https://www5.fdic.gov/idasp/confirmation_outside.asp?inCert1=25653. As such, the
status of MERS as nominee for Freemont ended when Freemont closed on July 25, 2008, which
renders the AOM created in 2012 void ab initio.
8. Ms. Keeley further testified the Pooling and Servicing Agreement for this
securitized trust backed up the veracity of the AOM. However, Ms. Keeley later conceded that,
according to the PSA, the chain of title for any loan within this trust went as follows:
[…]
<SNIPETS>
A. Unclean Hands Involving the Specific Endorsement and Assignment
of Mortgage That Both Reflect a Transaction that Never Happened
B. Unclean Hands For Violating the Court’s Discovery Order Despite
Plaintiff’s Representations That It Fully Complied With That Order
A. The Legal Fiction That Ocwen’s Loan Boarding Process In This Case
Verifies The Accuracy, Reliability of Correctness of the Prior
Servicer’s Records
B. Plaintiff’s Failure To Lay A Predicate For Prior Servicer Litton’s
Breach or Default Letter
C. Plaintiff Failed To Prove Standing By Virtue of an Endorsement and
an Assignment of Mortgage Created For Purposes of Litigation That
Both Miss a Key Line in the Title of Ownership, namely the Depositor
50. The Court gives great weight as the trier of fact to the testimony of Defendant’s
expert witness, Kathleen Cully. Ms. Cully is a Yale Law School graduate that worked her entire career in structured finance transactions since 1985. She was extremely well versed in the Uniform Commercial Code. Among many other tasks and accomplishments, Ms. Cully testified that she led the Citigroup team that created the first pooling and servicing agreement ever. She led Citigroup’s Global Securitization strategy. The Court finds Ms. Cully eminently qualified as
an expert witness in the area of securitized transactions and their interplay with the Model Uniform Commercial Code.
58. This Court does not address the provision described in the Nunez opinion, instead grounding this decision on a myriad of other provisions of the Mortgage establishing the Note is subject to and governed by the Mortgage, rendering the note a non-negotiable instrument.
