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Institutional Holders of Countrywide-Issued RMBS Issue Notice of Non-Performance Identifying Alleged Failures by Master Servicer to Perform Covenants and Agreements in More Than $47 Billion of Countrywide-Issued RMBS

Institutional Holders of Countrywide-Issued RMBS Issue Notice of Non-Performance Identifying Alleged Failures by Master Servicer to Perform Covenants and Agreements in More Than $47 Billion of Countrywide-Issued RMBS

PR Newswire

HOUSTON, Oct. 18 /PRNewswire/ –Today, the holders of over 25% of the Voting Rights in more than $47 billion of Countrywide-issued RMBS sent a Notice of Non-Performance (Notice) to Countrywide Home Loan Servicing, as Master Servicer (“Countrywide Servicing”), and to Bank of New York, as Trustee, identifying specific covenants in 115 Pooling and Servicing Agreements (PSAs) that the Holders allege Countrywide Servicing has failed to perform.

The Holders’ Notice alleges that each of these failures has materially affected the rights of the Certificateholders under the relevant PSAs. Under Section 7.01 of the PSAs, if any of the cited failures “continues unremedied for a period of 60 days after the date on which written notice of such failure has been given … to the Master Servicer and the Trustee by the Holders of Certificates evidencing not less than 25% of the Voting Rights evidenced by the Certificates,” that failure constitutes an Event of Default under the PSAs.

In a previous release, the Holders emphasized their intent to invoke all contractual remedies available to them to recover their losses and to protect their rights. Kathy Patrick of Gibbs & Bruns LLP, lead counsel for the Holders, emphasized that the Holders’ notice does not seek to halt loan modifications for troubled borrowers. Instead, it urges the Trustee to enforce Countrywide Servicing’s obligations to service loans prudently by maintaining accurate loan records, demanding the repurchase of loans that were originated in violation of underwriting guidelines, and compelling the sellers of ineligible or predatory mortgages to bear the costs of modifying them for homeowners or repurchasing them from the Trusts’ collateral pools.

Patrick also noted that the group of Holders that tendered today’s Notice of Non-Performance is larger, and encompasses more Countrywide-issued RMBS deals, than were included in the August 20 instruction letter. When asked why the group of holders was larger, Patrick replied, “Ours is a large, determined, and cohesive group of bondholders. We have a clearly defined strategy. We plan to vigorously pursue this initiative to enforce Holders’ rights.”

The Notice of Non-Performance, which is the first step in the process of declaring an Event of Default, was issued on behalf of Holders in the following Countrywide-issued RMBS:

Deal Name   .   .                 .       .
Deal Name    .       .      .                      .
Deal Name
CWALT 2004-32CB

CWHL 2004-22
CWL 2006-15
CWALT 2004-6CB

CWHL 2004-25
CWL 2006-16
CWALT 2004-J1
CWHL 2004-29
CWL 2006-19
CWALT 2005-14
CWHL 2004-HYB9
CWL 2006-2
CWALT 2005-21CB
CWHL 2005-11
CWL 2006-20
CWALT 2005-24
CWHL 2005-14
CWL 2006-22
CWALT 2005-32T1
CWHL 2005-18
CWL 2006-24
CWALT 2005-35CB
CWHL 2005-19
CWL 2006-25
CWALT 2005-36
CWHL 2005-2
CWL 2006-26
CWALT 2005-44
CWHL 2005-3
CWL 2006-3
CWALT 2005-45
CWHL 2005-30
CWL 2006-5
CWALT 2005-56
CWHL 2005-9
CWL 2006-7
CWALT 2005-57
CB CWHL 2005-HYB3
CWL 2006-9
CWALT 2005-64
CB CWHL 2005-HYB9
CWL 2006-BC2
CWALT 2005-72
CWHL 2005-R3
CWL 2006-BC3
CWALT 2005-73CB
CWHL 2006-9
CWL 2006-BC4
CWALT 2005-74T1
CWHL 2006-HYB2
CWL 2006-BC5
CWALT 2005-81
CWHL 2006-HYB5
CWL 2006-SD1
CWALT 2005-AR1
CWHL 2006-J2
CWL 2006-SD3
CWALT 2005-J5
CWHL 2006-OA5
CWL 2006-SD4
CWALT 2005-J9
CWHL 2006-R2
CWL 2006-SPS2
CWALT 2006-14CB
CWHL 2007-12
CWL 2007-2
CWALT 2006-20CB
CWHL 2007-16
CWL 2007-5
CWALT 2006-37R
CWHL 2008-3R
CWL 2007-6
CWALT 2006-41CB
CWL 2005-10
CWL 2007-7
CWALT 2006-HY12
CWL 2005-11
CWL 2007-9
CWALT 2006-OA11
CWL 2005-13
CWL 2007-BC1
CWALT 2006-OA16
CWL 2005-16
CWL 2007-BC2
CWALT 2006-OA17
CWL 2005-2
CWL 2007-BC3
CWALT 2006-OA6
CWL 2005-4
CWL 2007-QH1
CWALT 2006-OA9
CWL 2005-5
CWL 2007-S3
CWALT 2006-OC10
CWL 2005-6

CWALT 2006-OC2
CWL 2005-7

CWALT 2006-OC4
CWL 2005-8

CWALT 2006-OC5
CWL 2005-9

CWALT 2006-OC6
CWL 2005-AB2

CWALT 2006-OC7
CWL 2005-AB3

CWALT 2007-17CB
CWL 2005-AB4

CWALT 2007-23CB
CWL 2005-BC5

CWALT 2007-24
CWL 2005-IM1

CWALT 2007-OA7
CWL 2006-10

CWALT 2008-2R
CWL 2006-12

.

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© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bac home loans, bank of america, bank of new york, countrywide, pooling and servicing agreement1 Comment

Open Letter To California Attorney General Edmund G. Brown Jr.: Foreclosure Crisis

Open Letter To California Attorney General Edmund G. Brown Jr.: Foreclosure Crisis

LAW OFFICES OF MOSES S. HALL, APC
2651 East Chapman Avenue, Suite 110
Fullerton, California 92831
Telephone (714) 738-4830
Facsimile (714)992-7916

September 9, 2010

Attorney General’s Office
California Department of Justice
Attn:  Edmund G. Brown Jr.
1300 “I” Street
Sacramento, CA 95814

Benjamin G. Diehl
Office of the California Attorney General
300 S. Spring Street,. Ste 1702
Los Angeles, CA  90013

Kathrin Sears
Office of the California Attorney General
455 Golden Gate Ave., Ste 1702
San Francisco, CA  94102

Re: Civil Code §§ 2923.52 and 2923.53
The People of The State of California vs. Countrywide et. al. LC093076
Petition for Writ of Mandamus

Dear Colleagues and Attorney General Edmund G. Brown Jr:

As you are aware, my office represents homeowners caught up in the foreclosure crisis currently occurring in the California housing market.

You may recall that my office sought your assistance in the matter of Mabry vs. Aurora Loan Services. Wherein the 4th Appellate District Division Three acknowledged a private right of action to prevent foreclosures on a citizen’s primary residence, when the bank and/or mortgage holder has not complied with Civil Code § 2923.5. However, your office opted not to participated in what I believe was a landmark decision for homeowners in the battle against foreclosure prevention here in California.

Notwithstanding the Stipulated Judgment and Injunction that your office had obtained against Countrywide/Bank of America in the above referenced case, Bank of America filed an Amicus Curia Brief in the Mabry action espousing no private right of action and no obligation to modify distressed loans.

I am fully aware, grateful and commend your office for its attempts to crackdown on loan modification schemes that have swindled millions of dollars out of frightened and frustrated homeowners. Some homeowners who were and still are willing to believe against all logic or reason that the companies, whom practiced such schemes, could actually get the mortgage holder to give them some sort of State or Federal assistance that could prevent the losing of their homes and becoming homeless.

I further commend your office for its 2008 lawsuit against then Countrywide Financial, Countrywide Home Loans, Inc., and Spectrum Lending, Inc., who are now commonly referred to as Bank of America N.A. and BAC Home Loans (BAC).  An action which ultimately resulted in the successful acquiring of a Stipulated Judgment and Injunction against (BAC) on October 14, 2008.

The BAC lawsuit’s primary focus was on the predatory lending practices of the Defendants. The Stipulated Judgment and Injunction provides a remedy that creates yet another avenue for BAC borrowers to find relief and even the possibility of preventing the loss of their homes. The loss of a home is a threat that is ever too common, albeit avoidable with help from BAC, for numerous California BAC borrowers in this foreclosure crisis.

I wish this letter could end here or at least continue to praise your efforts and accomplishments as the present Attorney General of California. However, unfortunately, it must now turn to the present state of affairs and your lack of aggressiveness in the pursuit against the foe you identified and successfully prosecuted in the People vs. Countrywide, et.al. action.

I believe judgment obtained against BAC was merely the tip of the iceberg.  You may or may not be aware that IndyMac Bank, now OneWest Bank, has been sued by their investors for providing false and misleading appraisals along with committing many underwriting violations, which gave thousands of Californians their present unconscionable loans [a copy of the court’s opinion is attached for your edification].

There are presently hearings scheduled on September 21, 2010 and September 22, 2010, that involve issues that would substantially curtail the foreclosures in California:

  • September 22, 2010 at 9:00 a.m. in Department 68 of the Los Angeles Superior Court, Mabry vs. Preston Dufauchard, Commissioner For the California Dept of Corporations, Real Party in Interest Aurora Loan Services, LLC, Case No: BS 127903. Petition for Writ of Mandamus.
    • The issue: Whether possessing a HAMP program equates as compliance with California Civil Code § 2923.53.
  • September 21, 2010 at 9:00 a.m. at the California 4th Appellate Court Division Three Vuki vs. Superior Court of California, Orange County Case No: GO43533, Real Party in Interest HSBC. Oral Argument.
    • The issue: Whether a bad faith compliance with Civil Code § 2923.53 makes the foreclosing beneficiary (HSBC) a bona fide purchaser pursuant to Civil Code §2923.54.
  • September 21, 2010 at 9:00 a.m. at the California 4th Appellate Court Division Three Sanchez vs. Superior Court of California, Orange County Case No: G043300, Real Party in Interest Litton Loan Servicing LLC.. Oral Argument.
    • The issue: Whether a fully executed and performed loan modification is terminated by the lender’s inadvertent sale of the subject real property in lieu of Civil Code § 2923.54.

These decisions are being sought by my office to help clarify citizens’ rights under the present Foreclosure Prevention Statutes.

My office has been very instrumental in not only the prosecution of these issues, on behalf of my clients, but all citizens of the State of California.

Unfortunately, the BAC Stipulated Judgment and Injunction does not provide a component for a private right of enforcement.  Thus, with respect to possible violations by BAC, such Stipulated Judgment and Injunction can only be enforced by your office.

My office would love to step into your shoes and be granted permission and the rights to enforcement under the Stipulated Judgment and Injunctions. That way we may stop all the Countrywide loan foreclosures presently scheduled and being conducted in California until each

prior Countrywide and/or BAC California borrower is offered the benefits under the Stipulated Judgment and Injunction your office obtained.

I do not believe that you could or are able to assign such a right, but I make it as a gesture of sincerity as to my conviction and belief of the wrongdoings of BAC.

I ask that you immediately seek Court intervention enjoining all Countrywide and/or BAC foreclosures proceedings that fall within the auspices of the Stipulated Judgment/Injunction.

Alternatively, you leave my office no choice but to seek a Writ of Mandamus asking the Court to instruct you and your office on your obligations as Attorney General of our great State.  I realize your business and acknowledge that this may not be your primary priority, but if I do not receive a response indicating your intent by September 17, 2010, I will deem you have no intent to respond, investigate this matter, or take other appropriate action and at that time will seek the Writ of Mandamus.

Notwithstanding the aforementioned paragraph, I wish you well on your campaign to return to the position of Governor of our great State.

Sincerely
Moses S. Hall;

Msh:

Attachments.

[ipaper docId=37177918 access_key=key-1z4imv8h7qye94n6t6b7 height=600 width=600 /]

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bac home loans, bank of america, CONTROL FRAUD, corruption, countrywide, deed of trust, foreclosure, foreclosure fraud, foreclosures, injunction, investigation, mortgage, mortgage modification, Real Estate, securitization, servicers, TRO, trustee, trustee sale, Trusts, Violations2 Comments

MERS ‘GETS FORECLOSED’| ASSIGNS NADA TO BAC fka COUNTRYWIDE

MERS ‘GETS FORECLOSED’| ASSIGNS NADA TO BAC fka COUNTRYWIDE

Court of Appeals of Ohio

UNION BANK CO. v. NORTH CAROLINA FURNITURE EXPRESS, LLC.

2010 Ohio 4176

The Union Bank Company, Plaintiff-Appellee,
v.
North Carolina Furniture Express, LLC, et al., Defendants-Appellants, and
Jeffrey Smith, et al., Defendants-Appellees.
Bac Home Loans Servicing Lp, Plaintiff-Appellant,
v.
Jeffrey T. Smith, et al., Defendants-Appellees.

Case No. 2-10-01

Court of Appeals of Ohio, Third District, Auglaize County.

Date of Decision: September 7, 2010.

Jason A. Whitacre, Laura C. Infante and Kathryn M. Eyster for Appellant, BAC Home Loans Servicing, L.P., fka Countrywide Home Loans Servicing, L.P.

Randy L. Reeves and Sarah N. Newland for Appellees, Jeffrey Smith and Kandi Smith.

John F. Moul for Appellee, Treasurer of Auglaize County

Jerry M. Johnson and Christine M. Bollinger for Appellee, The Union Bank Company

Thomas J. Katterheinrich for Appellee, Minster Bank.

OPINION

PRESTON, J.

{¶1} Appellant-defendant, BAC Home Loans Servicing, L.P., f.k.a. Countrywide Home Loans Servicing, L.P., (hereinafter “BAC”), appeals the Auglaize County Court of Common Pleas’ judgments, which vacated BAC’s foreclosure action and denied motions to consolidate and substitute BAC as a party-defendant. For the reasons that follow, we affirm.

{¶2} This case involves two separate foreclosure actions filed in the Auglaize County Court of Common Pleas that sought judgments on certain notes and mortgages encumbering the same parcel of real estate, commonly known as 422 South Franklin Street, New Bremen, Ohio (hereinafter “the property”). The facts of this case are largely not in dispute. On November 13, 2002, Jeffrey Smith and Kandi Smith (hereinafter “the Smiths”), who were members of North Carolina Furniture Express, L.L.C., executed a note in favor of SIB Mortgage Corp., a New Jersey corporation (hereinafter “SIB”), and a mortgage in favor of Mortgage Electronic Registration Systems, Inc. (hereinafter “MERS”), solely as nominee for SIB Mortgage Corp., for $141,000.00. The mortgage was subsequently recorded in the Auglaize County Recorder’s Office on November 18, 2002.

{¶3} Several years later, on January 19, 2007, the Smiths executed another note and mortgage in favor of appellee Minster Bank (hereinafter “Minster Bank”) for $30,000.00. This mortgage was recorded in the Auglaize County Recorder’s Office on January 26, 2007. Then, on March 5, 2007, the Smiths executed three separate notes and mortgages in favor of appellee The Union Bank Company (hereinafter “Union Bank”) for $100,000.00, $25,000.00, and $24,500.00, which were subsequently recorded in the Auglaize County Recorder’s Office on March 9, 2007.[ 1 ]

{¶4} On July 23, 2008, Union Bank filed a complaint for foreclosure against the property, which was designated Case No. 2008 CV 0267 (hereinafter “the 2008 foreclosure”). In the complaint, Union Bank listed North Carolina Furniture Express, L.L.C., the Smiths, Minster Bank, MERS, SIB, the Auglaize County Treasurer, and Entrust Administration, Inc. as defendants possibly having an interest in the property. All named defendants were served with notice. According to the record, MERS was served on July 30, 2008, and SIB was served on November 14, 2008. Minster Bank and the Smiths filed timely answers to the complaint.

{¶5} Union Bank filed a motion for default judgment against defendants MERS, SIB, and Entrust Administration, Inc., on March 10, 2009. The motion for default judgment was sent to all named defendants in the matter, including MERS and SIB. The trial court granted Union Bank default judgment on March 10, 2009, specifically stating that the defendants had “been legally served with summons and that Defendants are in default for answer or appearance and therefore has no interest in and to said premises and the equity of redemption of said Defendants in the real estate described in Plaintiff’s Complaint shall be forever cut off, barred, and foreclosed.” (2008 CV 0267, Mar. 10, 2009 JE). On March 11, 2009, Union Bank filed a motion for summary judgment against the Smiths, Minster Bank, and the Auglaize County Treasurer. Similarly, a copy of the motion for summary judgment was sent to all named defendants in the matter, including MERS and SIB. On March 30, 2009, the trial court granted the motion for summary judgment and issued a judgment of foreclosure providing that the lien priority on the property was as follows: the Auglaize County Treasurer, Minster Bank, and then Union Bank.

{¶6} Shortly thereafter, the Smiths filed for bankruptcy on May 12, 2009, causing the matter to be stayed. On June 9, 2009, the bankruptcy court issued a relief from stay and abandonment for Union Bank, which allowed the 2008 foreclosure matter to continue effective on July 31, 2009, and the property was scheduled for sheriff’s sale on October 1, 2009. However, due to a notice of sale not being received or served on all party defendants, the sale was cancelled and rescheduled for December 4, 2009.

{¶7} During this time and right after the Smiths had filed for bankruptcy, on June 1, 2009, MERS (acting solely as a nominee for SIB) assigned appellant BAC its interest in the property. (2009 CV 312, Oct. 7, 2009 JE, Ex. A). Consequently, on August 28, 2009, BAC filed a complaint for foreclosure against the property in the Auglaize County Court of Common Pleas, which was designated Case No. 2009 CV 0312 (hereinafter “the 2009 foreclosure”). Along with the complaint, BAC filed a preliminary judicial report showing what it believed to be a representation of any and all interests in the property.[ 2 ] In its complaint, BAC named the Smiths, Minster Bank, Union Bank, and the Auglaize County Treasurer as defendants having a possible interest in the property. Only Minster Bank and Union Bank filed answers to the complaint.[ 3 ] Thereafter, on October 7, 2009, BAC filed a motion for default judgment against the non-answering parties, and that same day, the trial court issued a judgment entry and decree in foreclosure granting BAC’s motion for default judgment and listing the lien priority on the property in the following order: the Auglaize County Treasurer, BAC, Minster Bank, and then Union Bank.

{¶8} As a result, on October 9, 2009, Union Bank filed a motion contra to BAC’s motion for default judgment and a motion to dismiss BAC’s complaint in the 2009 foreclosure action based on the existence of the 2008 foreclosure action. Additionally, on October 16, 2009, Union Bank and Minster Bank filed a joint motion to vacate the judgment entry of default in the 2009 foreclosure action, since they had not been afforded sufficient time to respond to BAC’s motion before the judgment entry of foreclosure had been granted.

{¶9} In response to the existence of the 2008 foreclosure action, on October 21, 2009, BAC filed several motions, which included: (1) a motion to substitute defendant BAC for defendant MERS; (2) a motion to set aside the default judgment action entered against MERS in the 2008 foreclosure action; (3) a motion to stay the 2008 foreclosure default judgment entry pending resolution of the motion to set aside the judgment entry; (4) a motion to consolidate cases 2008 CV 0267 and 2009 CV 0312; or in the alternative (5) a motion for leave to file an answer to the 2008 complaint and cross-claim.[ 4 ] Union Bank filed a response opposing all of BAC’s motions in the 2008 foreclosure case.

{¶10} In both of the foreclosure actions, the trial court set all of the motions for a hearing, which was held on November 3, 2009. Thereafter, on December 3, 2009, the trial court issued a judgment entry addressing the issues in both the 2008 and 2009 foreclosure cases, but specifically stating that it was not consolidating the cases for any other purposes other than the issues presented at the November 3, 2009 hearing. Consequently, in its judgment entry, the trial court vacated part of the 2009 foreclosure action, citing that the foreclosure portion of the action had been a “clerical error” within Civ.R. 60(A). Nevertheless, the trial court found that there had been no error as against the Smiths, and thus it allowed the 2009 foreclosure action to stand, but again only as against the Smiths individually. In addition, the trial court dismissed the 2009 foreclosure complaint on the basis of res judicata, and denied the motion to consolidate and motion to substitute defendant BAC as a party-defendant in the 2008 foreclosure action finding that BAC had not acquired an interest in the property by operation of the doctrine of lis pendens.

{¶11} BAC now appeals and raises four assignments of error. For ease of our discussion we also elect to address all of BAC’s assignments of error together.

ASSIGNMENT OF ERROR NO. I

THE TRIAL COURT ABUSED ITS DISCRETION WHEN IT FAILED TO EXPRESSLY RULE ON APPELLANT’S MOTION TO SET ASIDE DEFAULT JUDGMENT AND FAILED TO APPLY THE PROPER STANDARD FOR RULING ON SUCH A MOTION.

ASSIGNMENT OF ERROR NO. II

THE TRIAL COURT ABUSED ITS DISCRETION WHEN IT VACATED THE OCTOBER 7, 2009 JUDGMENT ENTRY IN CASE NUMBER 2009 CV 0312 PURSUANT TO CIV.R. 60(A).

ASSIGNMENT OF ERROR NO. III

THE TRIAL COURT ABUSED ITS DISCRETION WHEN IT REPRIORITIZED THE LIENS AGAINST THE PROPERTY SUBJECT TO CASE NUMBERS 2008 CV 0267 AND 2009 CV 0312.

ASSIGNMENT OF ERROR NO. IV

THE TRIAL COURT ERRED AND ABUSED ITS DISCRETION WHEN IT FOUND THAT BAC DID NOT OBTAIN AN INTEREST IN THE PROPERTY WHEN IT OBTAINED ITS ASSIGNMENT BY OPERATION OF THE LIS PENDENS DOCTRINE.

{¶12} Essentially, BAC argues that the follwing decisions in the trial court’s December 3, 2009 judgment entry were erroneous: (1) its ruling on the motion to substitute; (2) failing to rule on its motion to set aside the default judgment pursuant to Civ.R. 60(B); (3) vacating part of the 2009 foreclosure action; and (4) its reprioritization of the liens against the property in the 2008 foreclosure action.

{¶13} As stated above, the trial court first denied the motion to substitute BAC as a party-defendant on the basis that it did not obtain any interest in the subject real estate when it obtained its assignment from MERS. (Dec. 3, 2009 JE at 3-4). As a result, the trial court vacated part of the 2009 foreclosure action (only as against the banks) and failed to address BAC’s motion to set aside the default judgment pursuant to Civ.R. 60(B). (Id.). After reviewing the record and the applicable law, we believe that the trial court did not abuse its discretion in rendering its December 3, 2009 judgment entry.

{¶14} First, we will address the motion to substitute BAC as a party-defendant for MERS in the 2008 foreclosure action. Civ.R. 25 governs the substitution of parties. Specifically, Civ.R. 25(C) provides that “[i]n cases of any transfer of interest, the action may be continued by or against the original party, unless the court upon motion directs the person to whom the interest is transferred to be substituted in the action or joined with the original action.” The decision of whether to allow a substitution of parties is discretionary with the trial court and may be granted only upon a finding of a transfer of interest. Ahlrichs v. Tri-Tex Corp. (1987), 41 Ohio App.3d 207, 534 N.E.2d 1231. As a result, this Court uses an abuse of discretion standard of review when determining whether a trial court erred with respect to a motion to substitute pursuant to Civ.R. 25. Argent Mtge. Co. v. Ciemins, 8th Dist. No. 90698, 2008-Ohio-5994, ¶9, citing Young v. Merrill Lynch, Pierce, Fenner & Smith (1993), 88 Ohio App.3d 12, 623 N.E.2d 94. An abuse of discretion constitutes more than an error of judgment and implies that the trial court acted unreasonably, arbitrarily, or unconscionably. Blakemore v. Blakemore (1983), 5 Ohio St.3d 217, 219, 450 N.E.2d 1140. When applying the abuse-of-discretion standard, a reviewing court may not simply substitute its judgment for that of the trial court. Id.

{¶15} While an assignment typically transfers the lien of the mortgage on the property described in the mortgage, as BAC acknowledged in its reply brief, an assignee can only take, and the assignor can only give, the interest currently held by the assignor. R.C. 5301.31. With that stated, it is clear under the facts of this case that BAC never obtained an interest in the property; thus, it could not have been substituted as a party-defendant in the 2008 foreclosure action. Here, with respect to the 2008 foreclosure action, the date the last party was served with notice was on January 28, 2009, which was almost six months before the purported assignment from MERS to BAC. Next, on March 11, 2009, the trial court issued a judgment entry of default against MERS foreclosing on its interest in the property. Once again, this default judgment was entered against MERS almost three months before the purported assignment from MERS to BAC occurred. The effect of this default judgment against MERS resulted in MERS having “no interest in and to said premises and the equity of redemption of said Defendants in the real estate described in Plaintiff’s Complaint shall be forever cut off, barred, and foreclosed.” (2008 CV 0267, Mar. 10, 2009 JE). Nevertheless, according to the documents filed by BAC to evidence its assignment from MERS, MERS assigned its interest to BAC on June 1, 2009. (2009 CV 312, Oct. 7, 2009 JE, Ex. A). Consequently, as a result of the already entered default judgment against MERS, when BAC was assigned MERS’ interest in the property on June 1, 2009, BAC did not receive a viable interest in the property. See Quill v. Maddox (May 31, 2002), 2nd Dist. No. 19052, at *2 (mortgagee’s assignee failed to establish that it had an interest in the property, as mortgagee’s interest was foreclosed by the court before mortgagee assigned its interest to assignee, which could acquire no more interest than mortgagee held). Thus, we find that it was reasonable for the trial court to have denied the motion to substitute BAC as a party-defendant for MERS given its lack of interest in the property.

{¶16} Additionally, BAC argues that the trial court erred because it did not apply the GTE Automatic standard to its motion for relief from judgment. See GTE Automatic Elec., Inc. v. ARC Industries, Inc. (1976), 47 Ohio St.2d 146, 150, 351 N.E.2d 113. In particular, BAC claims that the trial court never ruled on its Civ.R. 60(B) motion. BAC claims that not addressing its motion was erroneous. However, in this particular case, in light of our discussion above, there would have been no need to address the motion and apply any standard to the motion for relief from judgment because BAC lacked standing to challenge the default judgment entered against MERS.

{¶17} Civ.R. 60(B) allows “a party or legal representative” to vacate a default judgment upon successfully demonstrating that: “(1) the party has a meritorious defense or claim to present if relief is granted; (2) the party is entitled to relief under one of the grounds stated in Civ.R. 60(B)(1) through (5); and (3) the motion is made within a reasonable time * * *.” GTE Automatic Elec., Inc., 47 Ohio St.2d at 150, (emphasis added). However, BAC was neither a party nor was it a legal representative since it was not included in the original 2008 foreclosure action and was not allowed to be substituted as a party-defendant for MERS. Central Ohio Receivables Co. v. Huston (Sept. 20, 1988), 8th Dist. No. 87AP1-185, at *2-3 (holding that an assignee did not have standing to challenge a default judgment entered against its assignor). Accordingly, BAC lacked standing to challenge the default judgment entered against its assignor MERS in the 2008 foreclosure action, and the trial court did not abuse its discretion when it failed to rule on its motion.

{¶18} With respect to the trial court’s decision to vacate the 2009 foreclosure action, we note that the trial court did not vacate the 2009 foreclosure action in its entirety; rather, the court only vacated the portion of the action that pertained to an interest in the property. As we will discuss in further detail below, after dismissing the parties who were brought in because they had an interest in the property (i.e., Union Bank and Minster Bank), the only aspect in the 2009 foreclosure action that remained was the default judgment action against the Smiths. (Dec. 3, 2009 JE at 3-4). Nevertheless, we find that the trial court’s decision to vacate part of the 2009 foreclosure action was not an abuse of discretion.

{¶19} First of all, since MERS’ interest in the property had already been foreclosed prior to the filing of the 2009 foreclosure action, BAC did not obtain any interest in the property when it was assigned the mortgage from MERS, thus, BAC could not have brought a foreclosure action at all. Moreover, typically a pending foreclosure action between the same parties is grounds for abatement or dismissal of an assignee’s complaint. Avco Financial Services Loan, Inc. v. Hale (1987), 36 Ohio App.3d 65, 520 N.E.2d 1378; High Point Assn. v. Pochatek (Nov. 30, 1995), 8th Dist. Nos. 68000, 68395, at *3; Bates v. Postulate Invests., L.L.C., 176 Ohio App.3d 523, 2008-Ohio-2815, 892 N.E.2d 937, ¶16. Accordingly, it was reasonable for the trial court to dismiss BAC’s complaint based on the fact that the 2008 foreclosure action was still pending at the time BAC filed its 2009 foreclosure action. Therefore, although we may not agree with the trial court’s grounds for vacating most of the 2009 foreclosure action, we find that the trial court’s decision was reasonable under the circumstances and was not an abuse of discretion.

{¶20} Finally, as mentioned above, despite the trial court’s denial of the motion to substitute and its decision to vacate the 2009 foreclosure action as it related to any interest in the property, the trial court did add BAC as a lienholder in the December 3, 2009 judgment entry and stated that BAC had a fourth priority lien against the property. (Dec. 3, 2009 JE at 4). BAC claims this decision was also an abuse of discretion. Specifically, BAC claims that because the trial court recognized it had a lien against the property when it added BAC to the 2008 foreclosure lienholder list, the trial court clearly abused its discretion when it only recognized BAC as being the fourth priority lienholder, despite the fact that it had been assigned MERS lien, which would have given it the first priority lienholder to the property. Overall, BAC claims that the trial court could not have recognized it had an interest in the property without finding that it was also the first priority lienholder. While we acknowledge that the trial court obviously recognized that BAC had an interest the property, we disagree with BAC’s argument that this interest had to come from MERS’ first priority lienholder status pursuant to the mortgage.

{¶21} Despite the fact that the trial court vacated most of the 2009 foreclosure action, the trial court found that BAC’s default judgment and decree of foreclosure was valid but only as against the Smiths. This was because “as between BAC and Defendants Smith, BAC should obtain recovery of its Promissory Note, as assigned.” (Dec. 3, 2009 JE at 4). “The right to judgment on the note is one cause of action. The right to foreclose a mortgage is another cause of action. One is legal-the other is equitable.” Fifth Third Bank v. Hopkins, 177 Ohio App.3d 114, 2008-Ohio-2959, 894 N.E.2d 65, ¶15, quoting Fed. Deposit Ins. Corp. v. Simon (Aug. 17, 1977), 9th Dist. No. 8443. This is because a “mortgage is merely security for a debt and is not the debt itself.” Id., quoting Gevedon v. Hotopp, 2nd Dist. No. 20673, 2005-Ohio-4597, ¶27. As another appellate court explained:

A mortgage is a form of secured debt where the obligation, evidenced by a note, is secured by the transfer of an interest in property, accomplished by the delivery of a mortgage deed. Upon breach of condition of the mortgage agreement, a mortgagee has concurrent remedies. It may, at its option, sue in equity to foreclose, or sue at law directly on the note; or, bring an action in ejectment, Equity Savings & Loan v. Mercurio (1937), 24 Ohio Law Abs. 1, 2. Thus, suit on the note was not foreclosed by the disposition of the previous action in foreclosure, * * * Broadview Savings and Loan Company v. Crow (Dec. 30, 1982), 8th Dist. Nos. 44690, 44691, & 45002, at *3.

{¶22} As we explained above, BAC did not obtain an interest in the property since the mortgage it had obtained from MERS had already been foreclosed. Nevertheless, the default judgment entered against the Smiths in the 2009 foreclosure action gave BAC a judgment lien on the note, so BAC still had a right to collect its unsecured judgment lien out of the proceeds from the sale of the real estate. However, BAC’s judgment lien was not superior to those of Minster or Union Bank’s liens because BAC’s judgment on the note had not been issued until after the Smiths had executed mortgages to Minster and Union Bank. Therefore, we find that the trial court did not abuse its discretion when it recognized BAC’s judgment lien against the property in the 2008 foreclosure action and only recognized it as the fourth lienholder, because BAC’s lien was the result of the promissory note assigned from SIB, and not a result of the mortgage assigned by MERS.

{¶23} Overall, while we may not necessarily agree with all of the doctrines and rules the trial court used in reaching its decision, we nonetheless have held that “[a] judgment by the trial court which is correct, but for a different reason, will be affirmed on appeal as there is no prejudice to the appellant.” Wedemeyer v. U.S.S. F.D.R. (CV-42) Reunion Assoc., 3d Dist. No. 1-09-57, 2010-Ohio-1502, ¶50 quoting Davis v. Widman, 184 Ohio App.3d 705, 2009-Ohio-5430, 922 N.E.2d 272, ¶16 (citations omitted). Based on our discussion above, we find that the trial court did not abuse its discretion when it denied the motion to substitute BAC as a party-defendant for MERS in the 2008 foreclosure case on the basis that BAC did not acquire any interest in the property, when it failed to rule on BAC’s Civ.R. 60(B) motion, when it partially vacated the 2009 foreclosure action, and when it allowed BAC to have a fourth priority judgment lien.

{¶24} BAC’s first, second, third, and fourth assignments of error are, therefore, overruled.

{¶25} Having found no error prejudicial to the appellant herein in the particulars assigned and argued, we affirm the judgments of the trial court.

Judgments Affirmed

WILLAMOWSKI, P.J., concurs in Judgment Only.

ROGERS, J., Concurring in Part and Dissenting in Part.

{¶26} I respectfully concur in part and dissent in part from the decision of the majority.

{¶27} As to Assignment of Error No. I, I concur fully with the majority’s finding that the trial court did not err in denying BAC’s motion to substitute it as a party-defendant for MERS. I agree with the majority’s finding that, when the trial court issued a judgment entry against MERS foreclosing on its interest on March 11, 2009, MERS no longer had any viable interest in the property which it could assign to BAC on June 1, 2009. As such, I agree that, given BAC’s lack of interest in the property, the trial court was reasonable in denying BAC’s motion to substitute.

{¶28} Additionally, I wish to emphasize that the mortgage designated MERS “solely as nominee for SIB Mortgage Corp.” As expressed in my dissent in Countrywide Home Loans Servicing, L.P. v. Shifflet, et al., 3d Dist. No. 9-093-1, 2010-Ohio-1266, ¶¶18-21, I believe this language served solely to designate MERS as an agent for purposes of servicing the note and mortgage, and did not transfer to MERS any interest in the real estate or the repayment of moneys loaned. Therefore, it was never a real party in interest.

{¶29} Additionally, I believe that the majority’s finding in Assignment of Error No. I, with which I concur, is inconsistent with the remainder of the majority opinion.

{¶30} In its analysis of Assignment of Error No. II, the majority finds that the trial court did not abuse its discretion when it vacated the second foreclosure action (filed by BAC) and its default judgment because (1) BAC never obtained any interest in the property when MERS assigned to it the Smiths’ mortgage, and (2) a pending foreclosure action may be grounds for dismissal of an assignee’s complaint where the action is between the same parties. Nevertheless, the trial court did not vacate the portion of the second foreclosure action against the Smiths individually. Further, in its analysis of Assignment of Error No. II, the majority finds that the trial court did not abuse its discretion in listing BAC as the fourth priority lienholder because (1) BAC had a right to collect its unsecured judgment lien from the sale of the real estate foreclosed upon, and (2) BAC’s judgment lien was subordinate to Minster and Union Bank’s interests.

{¶31} While I agree with the majority’s conclusion that the trial court did not err in vacating portions of the second foreclosure action, I believe the trial court erred in failing to vacate the entire second foreclosure action. I find inconsistent the majority’s finding that any interest MERS had in the property was extinguished on March 11, 2009, and, thus, that it passed no viable interest to BAC, and the majority’s subsequent validation of the trial court’s finding that BAC’s default judgment and decree of foreclosure was valid against the Smiths. For the same reason, I find inconsistent the majority’s validation of the trial court’s prioritizing of BAC as the fourth lienholder in its December 2009 entry. I believe that the March 11, 2009 default judgment extinguished both the legal and equitable interests MERS, and consequently, BAC, had in the property. I would, therefore, reverse the trial court’s judgment, finding that it should have vacated the entire second foreclosure action and that it abused its discretion in recognizing BAC as a lienholder in the first foreclosure action, to which it was never a party. See, also, Fifth Third Bank v. Hopkins, 177 Ohio App.3d 114, 2008-Ohio-2959, ¶20 (Carr, P.J., concurring) (noting that, “[I]f such subsequent claims are not barred, consumers will be needlessly forced to defend numerous separate lawsuits. The ramifications could be onerous. First, to pay to defend against multiple lawsuits, debt-laden consumers might be forced to assume even greater financial burdens, taking out second or third mortgages on subsequent real estate purchases. This cycle could lead to consumers’ overextending themselves financially and facing additional subsequent foreclosure actions. Second, I believe that these subsequent lawsuits for money due, which could be resolved in conjunction with an initial foreclosure action, would clog the dockets of our trial courts”).

{¶32} I also disagree with the trial court’s application of the lis pendens doctrine, which it used to support its conclusion that BAC never obtained an interest in the property. I do not believe this is an appropriate use of lis pendens, but rather that any interest MERS had, and consequently that BAC could have obtained, was extinguished as operation of judgment.

{¶33} Finally, even if BAC had a valid assignment from a real party in interest, I would find that BAC’s foreclosure filing was barred by res judicata as argued in Union Bank’s “Motion in Contra to Plaintiff’s Motion for Default Judgment and Motion to Dismiss Plaintiff’s Complaint.” The Supreme Court of Ohio has held that “[t]he doctrine of res judicata encompasses the two related concepts of claim preclusion, also known as * * * estoppel by judgment, and issue preclusion, also known as collateral estoppel.” Grava v. Parkman Twp., 73 Ohio St.3d 379, 381, 1995-Ohio-331. This Court has previously held that “[c]laim preclusion prevents subsequent actions, by the same parties or their privies, based upon any claim arising out of a transaction that was the subject matter of a previous action.” Dawson v. Dawson, 3d Dist. Nos. 14-09-08, 10, 11, 12, 2009O-hio-6029, ¶36. Additionally, “[w]here a claim could have been litigated in the previous suit, claim preclusion also bars subsequent actions on that matter.” Dawson, 2009-Ohio-6029, at ¶36, citing Grava, 73 Ohio St.3d at 382. Here, Union Bank obtained a default judgment against BAC concerning the same subject matter in March 2009. Consequently, I would find BAC’s foreclosure filing in August 2009 to be barred by res judicata.

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bac home loans, chain in title, concealment, conflict of interest, conspiracy, CONTROL FRAUD, corruption, dismissed, foreclosure, foreclosure fraud, foreclosures, MERS, mortgage, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., stopforeclosurefraud.com1 Comment

FORECLOSURE FRAUD | AFFIDAVIT IN SUPPORT FOR ‘SUMMARY JUDGMENT’

FORECLOSURE FRAUD | AFFIDAVIT IN SUPPORT FOR ‘SUMMARY JUDGMENT’

AFFIDAVIT FAIL!

Just like the Lis Pendens arriving before the Assignment from Mortgage Electronic Registration Systems, Inc. with 1st Vice President Mark Bishop (who also signs for CityWide Mortgage Corp and America’s Wholesale Lender,etc.). There is no Assignment “created” from MERS to BAC Home Loan Servicing LP.

In this Affidavit we have Suzanne M. Haumesser signing as SR. Vice President of BAC Home Loan Servicing, LP. For Owner and Holder of Mortgage and Note, Bank of New York as Trustee for the Certificate Holders CWALT inc Alternative Loan Trust 2006-oa10 mortgage pass through certificates, series 2006-oa10

The Notary is Dolores V. Bald from Erie County, New York.

The day of service August 26. 2010

Date showing for the amount due “FEBRUARY 17, 2010”

Signed in California but notarized in New York!

Did Suzanne make a special trip just to sign this in NY?

NOW, Take a look at when this was NOTARIZED DECEMBER 30, 2009 (?08) months before the February 17, 2010 tally of the amounts due! It also looks like an 08 instead of a 09. Last the date of service was August 26, 2010. C’mon get real! Why does it take all these months?

If this was done in 2008 New York Notary Commissions are good for 4 years.


© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bac home loans, bank of new york, chain in title, conflict of interest, conspiracy, CONTROL FRAUD, corruption, countrywide, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, MERS, mortgage, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., Notary, notary fraud, note, securitization, servicers, STOP FORECLOSURE FRAUD, trade secrets, trustee, Trusts, Wall Street4 Comments

Conflict of Interest? Federal Judges’ ties to Bank of America…Remember the UTAH CASE???

Conflict of Interest? Federal Judges’ ties to Bank of America…Remember the UTAH CASE???

If youl recall my post Notice of Appeal Filed – Stay of Court Order to Vacate Injunction Stopping Bank of America Foreclosures in Utah Requested

I stated There is something not right here and I think the outcome might surprise us!

WELL HERE IT IS.

Reported by: Kelli O’Hara
Last Update: 1:29 am

SALT LAKE CITY, Utah (ABC 4 News) – “They’re foreclosing illegally here in Utah,” those were the words of St. George Attorney John Christian Barlow spoken in early June. Barlow at the time had appeared before a Federal Judge arguing that the Banking Giant, Bank of America, was foreclosing illegally in the State of Utah. The Southern Utah Attorney believed that because B.O.A was not a registered business or corporation in the state, they lacked authority to do business here.

Barlow had succeeded in getting a 5th Circuit Court Judge to agree with him; as a result the judge imposed an injunction on all Bank of America foreclosures. Weeks later, the case went before a Federal Judge where B.O.A. argued that they were regulated by Federal Laws not State. Federal Judge Clark Waddoups heard case, and threw out the injunction therefore Bank of America’s foreclosure company: ReConTrust was allowed to foreclose once again.

After the decision, ABC4 got a tip about the case and started digging. Our tipster said that the Judge may have a conflict of interest in hearing the B.O.A. cases. Why? Because the Judge Waddoups old law firm represents Bank of America.

We checked into Waddoups background and the Federal Judge did work for Parr,Brown, Gee & Loveless for nearly 30 years. And Waddoups, as of 2008, drew a pension from the law firm. We placed a call to the firm, but they wouldn’t comment if the former firm Partner had ever handled B.O.A cases.

Continue reading …ABC4

RELATED ARTICLE BELOW:

_____________________________________

What does DJSP, Enterprises Newly Appointed Counsel have in common with PBC Judge Meenu Sasser?

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bac home loans, bank of america, concealment, conflict of interest, conspiracy, CONTROL FRAUD, corruption, djsp enterprises, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, investigation, Law Offices Of David J. Stern P.A., MERS, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., Recontrust, stopforeclosurefraud.com2 Comments

EXCLUSIVE | ‘MERS’ DEPOSITION of SECRETARY and TREASURER of MERSCORP 4/2010

EXCLUSIVE | ‘MERS’ DEPOSITION of SECRETARY and TREASURER of MERSCORP 4/2010

Could this deposition hold the key to take all of MERS V3 &  MERSCORP down!

There is not 1, 2 but 3 MERS, Inc. in the past.

Just like MERS et al signing documents dated years later from existence the Corporate employees do the same to their own corporate resolutions! Exists in 1998 and certifies it in 2002.

If this is not proof of a Ponzi Scheme then I don’t know what is… They hide the truth in many layers but as we keep pulling and peeling each layer back eventually we will come to the truth!

“A Subtle Stranger” Orchestrates a Paradigm Shift

MERS et al has absolutely no supervision of what is being done by it’s non-members certifying authority PERIOD!

SUPERIOR COURT OF NEW JERSEY
CHANCERY DIVISION – ATLANTIC COUNTY
DOCKET NO. F-10209-08
BANK OF NEW YORK AS TRUSTEE FOR
THE CERTIFICATE HOLDERS CWABS,
INC. ASSET-BACKED CERTIFICATES,
SERIES 2005-AB3
Plaintiff(s),
vs.
VICTOR and ENOABASI UKPE
Defendant(s).

___________________________________________
VICTOR and ENOABASI UKPE
Counter claimants and
Third Party Plaintiffs,
vs.
BANK OF NEW YORK AS TRUSTEE FOR
THE CERTIFICATE HOLDERS CWABS,
INC. ASSET-BACKED CERTIFICATES,
SERIES 2005-AB3
Defendants on the Counterclaim,
and
AMERICA’S WHOLESALE LENDER;
COUNTRYWIDE HOME LOANS, INC.;
MORGAN FUNDING CORPORATION,
ROBERT CHILDERS; COUNTRYWIDE
HOME LOANS SERVICING LP,
PHELAN, HALLINAN & SCHMIEG,
P.C.,
Third Party Defendants
——————–

Deposition of William C. Hultman, Secretary and Treasurer of MERSCORP

[ipaper docId=36513502 access_key=key-1ltln0ondmrqe0v9156u height=600 width=600 /]

Does MERS have any salaried employees?
A No.
Q Does MERS have any employees?
A Did they ever have any? I couldn’t hear you.
Q Does MERS have any employees currently?
A No.
Q In the last five years has MERS had any
employees
?
A No.
Q To whom do the officers of MERS report?
A The Board of Directors.
Q To your knowledge has Mr. Hallinan ever
reported to the Board?
A He would have reported through me if there was
something to report.
Q So if I understand your answer, at least the
MERS officers reflected on Hultman Exhibit 4, if they
had something to report would report to you even though
you’re not an employee of MERS, is that correct?
MR. BROCHIN: Object to the form of the
question.
A That’s correct.
Q And in what capacity would they report to you?
A As a corporate officer. I’m the secretary.
Q As a corporate officer of what?
Of MERS.
Q So you are the secretary of MERS, but are not
an employee of MERS?
A That’s correct.

etc…
How many assistant secretaries have you
appointed pursuant to the April 9, 1998 resolution; how
many assistant secretaries of MERS have you appointed?
A I don’t know that number.
Q Approximately?
A I wouldn’t even begin to be able to tell you
right now.
Q Is it in the thousands?
A Yes.
Q Have you been doing this all around the
country in every state in the country?
A Yes.
Q And all these officers I understand are unpaid
officers of MERS
?
A Yes.
Q And there’s no live person who is an employee
of MERS that they report to, is that correct, who is an
employee?
MR. BROCHIN: Object to the form of the
question.
A There are no employees of MERS.

RELATED ARTICLE:

_____________________________

MERS 101

_____________________________

FULL DEPOSITION of Mortgage Electronic Registration Systems (MERS) PRESIDENT & CEO R.K. ARNOLD “MERSCORP”

_____________________________

DEPOSITION of A “REAL” VICE PRESIDENT of MERS WILLIAM “BILL” HULTMAN

_____________________________

HOMEOWNERS’ REBELLION: COULD 62 MILLION HOMES BE FORECLOSURE-PROOF?

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bac home loans, bank of america, bank of new york, chain in title, concealment, conflict of interest, conspiracy, CONTROL FRAUD, corruption, countrywide, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, insider, investigation, lawsuit, MERS, MERSCORP, mortgage, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., note, originator, R.K. Arnold, racketeering, Real Estate, sanctioned, scam, securitization, servicers, stopforeclosurefraud.com, sub-prime, TAXES, trustee, trustee sale, Trusts, truth in lending act, unemployed, Violations, Wall Street4 Comments

MASSIVE RULING TO PROTECT CALIFORNIA HOMEOWNERS FROM NON JUDICIAL FORECLOSURE: MABRY v. THE SUPERIOR COURT OF ORANGE COUNTY CODE 2923.5

MASSIVE RULING TO PROTECT CALIFORNIA HOMEOWNERS FROM NON JUDICIAL FORECLOSURE: MABRY v. THE SUPERIOR COURT OF ORANGE COUNTY CODE 2923.5

From: b.daviesmd6605

PUBLISHED OPINION AT THE APPEALS LEVEL FOR CC 2923.5. IT IS THE LAW. THERE IS A FACT SPECIFIC CAUSE OF ACTION FOR THIS CALIFORNIA CODE. THIS IS A MASSIVE PROTECTION IN CALIFORNIA FOR THE DEVIL DEEDS OF CC2924, NON JUDICIAL FORECLOSURE. MASSIVE POSITIVE FINALLY FOR HOMEOWNERS IN CALIFORNIA.

[ipaper docId=32477885 access_key=key-172hdd7a3mrc8oyqffji height=600 width=600 /]

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in aurora loan servicing, bac home loans, CONTROL FRAUD, corruption, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, STOP FORECLOSURE FRAUD2 Comments

LADOUCER v. BAC HOME LOANS SERVICING, LP, Dist. Court, SD Texas, Corpus Christi Div. 2010 "DO NOT BELIEVE A WORD THEY SAY"

LADOUCER v. BAC HOME LOANS SERVICING, LP, Dist. Court, SD Texas, Corpus Christi Div. 2010 "DO NOT BELIEVE A WORD THEY SAY"

Always follow your “INSTINCTS”

WILLIAM C LADOUCER, et al, Plaintiffs,
v.
BAC HOME LOANS SERVICING, LP, et al, Defendants.

Civil Action No. C-10-78.

United States District Court, S.D. Texas, Corpus Christi Division.

 April 23, 2010.

 

ORDER

 

JANIS GRAHAM JACK, District Judge.

On this day came on to be considered the Court’s sua sponte review of its subject matter jurisdiction in the above-styled action. For the reasons discussed below, the Court REMANDS this action pursuant to 28 U.S.C. § 1447(c) to the 79th Judicial District of Jim Wells, Texas, where it was originally filed and assigned Cause No. 10-02-48732-CV.

 

I. Factual and Procedural Background

In their Original Petition, Plaintiffs William C. Ladoucer and Julie A. Ladoucer allege as follows:

Plaintiffs were the owners of a home located at 271 House Avenue in Sandia, Jim Wells County, Texas and that the Defendants BAC Home Loan Servicing, LP (“BAC”) and Countrywide Home Loans, Inc. (“Countrywide”) were the respective servicer and holder of the mortgage on that property. (D.E. 1, Exh. 1 p. 2.) On December 29, 2008, Plaintiffs signed a resale contract to sell their property with a closing date set for February 27, 2009. (Id. at pp. 2-3.) Plaintiffs faxed the contract of sale to Defendant Countrywide. (Id. at p. 2.) Plaintiff Julie A. LaDoucer spoke to a representative at Countrywide’s Homeowner Retention Department to confirm receipt of the contract and was led to believe “that a foreclosure sale that the defendants had scheduled for January of 2009 was cancelled.” (Id. at pp. 2-3.) However, instead of cancelling the foreclosure, “Defendants foreclosed on the property on January 6, 2009.” (Id.) After the foreclosure, Plaintiffs claim that the potential buyers backed out of the sale and Plaintiffs “thereby lost almost $27,680.00 in equity which they would have realized from the sale of the property.” (Id. at p. 3.)

In February 2009, Plaintiffs allege that Defendants took possession of the property and changed the locks. (Id. at p. 3.) In March 2009, Plaintiffs allege that personal property had been taken from the home including a $4,500 shed that had been purchased by the Plaintiffs. (Id. at pp. 3-4.) Plaintiffs’ credit rating was also adversely affected by the foreclosure notation on their credit. (Id. at p. 4.)

Plaintiffs filed this action in state court on February 1, 2010. (D.E. 1, Exh. 1.) Defendants were served with process of February 16, 2010 and timely removed this case to federal court on March 12, 2010 on the grounds that this Court has diversity jurisdiction over this action. (D.E. 1.) Plaintiffs filed an Amended Complaint on April 23, 2010.[1] (D.E. 11.)

II. Discussion

 A. General Removal Principles

 A defendant may remove an action from state court to federal court if the federal court possesses subject matter jurisdiction over the action. 28 U.S.C. § 1441(a); see Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002). A court, however, “must presume that a suit lies outside its limited jurisdiction.” Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001). The removing party, as the party seeking the federal forum, bears the burden of showing that federal jurisdiction is proper. See Manguno, 276 F.3d at 723. “Any ambiguities are construed against removal because the removal statute should be strictly construed in favor of remand.” Id. When subject matter jurisdiction is improper, a court may raise the issue sua sponte. See Lane v. Halliburton, 529 F.3d 548, 565 (5th Cir. 2008) (“We are duty-bound to examine the basis of subject matter jurisdiction sua sponte.” (citations omitted)); H&D Tire and Auto. Hardware v. Pitney Bowes Inc., 227 F.3d 326, 328 (5th Cir. 2000) (“We have a duty to raise the issue of subject matter jurisdiction sua sponte.”).

 B. Removal Based on Diversity Jurisdiction

When the alleged basis for federal jurisdiction is diversity under 28 U.S.C. § 1332, the removing defendant has the burden of demonstrating that there is: (1) complete diversity of citizenship; and (2) an amount-in-controversy greater than $75,000. See 28 U.S.C. § 1332(a).

 1. Diversity of Parties

 Section 1332(a) requires “complete diversity” of citizenship, and the district court cannot exercise diversity jurisdiction if one of the plaintiffs shares the same state citizenship as any one of the defendants. See Corfield v. Dallas Glen Hills LP, 355 F.3d 853, 857 (5th Cir. 2003). In removal cases, diversity of citizenship must exist both at the time of filing in state court and at the time of removal to federal court. See Coury v. Prot, 85 F.3d 244, 249 (5th Cir. 1996).

 In this case, complete diversity exists because Plaintiffs are residents of Texas and Defendant BAC is a resident of North Carolina while Defendant Countrywide is a New York corporation with its principal place of business in California. (D.E. 1.)

 2. Amount in Controversy

Generally, the amount in controversy for the purposes of establishing federal jurisdiction should be determined by the plaintiff’s complaint. See St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 288 (1938); De Aguilar v. Boeing Co., 47 F.3d 1404, 1411-12 (5th Cir. 1995). Where the plaintiff has not made a specific monetary demand, the defendant has the burden to prove by a preponderance of the evidence that the amount in controversy exceeds the jurisdictional amount. See Manguno, 276 F.3d at 723 (“where . . . the petition does not include a specific monetary demand, [the defendant] must establish by a preponderance of the evidence that the amount in controversy exceeds $75,000”); St. Paul Reinsurance Co. v. Greenberg, 134 F.3d 1250, 1253 (5th Cir. 1998); Allen v. R&H Oil & Gas Co., 63 F.3d 1326, 1335 (5th Cir. 1995).

1. This Court Lacks Diversity Jurisdiction Over This Case

 Plaintiffs do not demand over $75,000, the minimum amount of damages necessary for federal diversity jurisdiction. (D.E. 1, Exh. 1.) Rather, Plaintiffs’ Original Petition states that the foreclosure of the home itself caused only $27,680 of damages in lost equity. (Id. at 3.) Further, Plaintiffs claim that the total damages for the wrongful foreclosure, fraud, and breach of contract claims, including the above-stated $27,680 damages in lost equity, are “at least $35,000.” (D.E. 1, Exh. 1, pp. 4-5.) Plaintiffs also claim “at least $20,000” for the exemplary damages claim, and “at least $5000” for reasonable attorneys’ fees. (D.E. 1, Exh. 1, pp. 4-5.) In total, Plaintiffs claim only $70,000 in damages. This is less than the $75,000 required for diversity jurisdiction. 28 U.S.C. § 1332.

 Defendants, in a conclusory manner, nonetheless assert that “[t]he face of the petition . . . reveals that the amount in controversy exceeds $75,000.” (D.E. 1, p. 3.) Defendants state that under Texas law, exemplary damages “could alone result in the recovery of more than $75,000.” (Id. (emphasis added).) However, Defendants ignore that Plaintiffs’ Petition specifies only $20,000 in exemplary damages, drastically less than Defendants’ assertions. (D.E. 1, Exh. 1, p. 4.) Based on Defendants’ claims alone, this Court cannot assume that exemplary damages will be so high that they would give this Court jurisdiction. This is especially true given that “[a]ny ambiguities are construed against removal because the removal statute should be strictly construed in favor of remand.” Manguno v. Prudential Property and Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002) (citing Acuna v. Brown & Root, Inc., 200 F.3d 335, 339 (5th Cir. 2000)).

 Defendants have thus failed to establish that this action involves an amount in controversy of more than $75,000, exclusive of costs and interests, as required for this Court to have diversity jurisdiction over this suit pursuant to 28 U.S.C. § 1332. Therefore, Defendants have failed to meet their burden of showing that federal jurisdiction exists and that removal was proper. Frank v. Bear Stearns & Co., 128 F.3d 919, 921 (5th Cir. 1997) (“The party invoking the removal jurisdiction of federal courts bears the burden of establishing federal jurisdiction over the state court suit.”). Accordingly, this Court must remand this action pursuant to 28 U.S.C. § 1447(c). (“If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.”). See Lott v. Dutchmen Mfg., Inc., 422 F.Supp.2d 750, 752 (E.D. Tex. 2006) (citing Manguno, 276 F.3d at 723).

 III. Conclusion

 For the reasons stated above, this Court determines sua sponte that it does not have subject matter jurisdiction over the above-styled action. This case is hereby REMANDED pursuant to 28 U.S.C. § 1447(c) to the 79th Judicial District of Jim Wells, Texas, where it was originally filed and assigned Cause No. 10-02-48732-CV.

 SIGNED and ORDERED.

[1] Plaintiffs filed an Amended Complaint on April 23, 2010, however, for purpose of removal, this Court looks only to the pleadings and allegations at the time of removal. See Adair v. Lease Partners, Inc., 587 F.3d 238, 243 (5th Cir. 2009) (“[T]he power to remove is evaluated at the time of removal.”); Cavallini v. State Farm Mut. Auto Ins. Co., 44 F.3d 256, 265 (5th Cir. 1995) (finding removal jurisdiction is based on complaint at the time of removal and a plaintiff cannot defeat removal by amending the complaint).

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