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SoFla Woman’s 2-Year Battle Gets Mortgage Wiped Out

SoFla Woman’s 2-Year Battle Gets Mortgage Wiped Out


Wonder whose signature was/is still on her documents? His name is Scott Anderson!

Read all about Scott Anderson here.


NBC 6-

A South Florida woman succeeded with the unheard of when she was able to get her mortgage wiped out by a lender.

In an effort to save her mother’s home, Idania Castro waged a two-year battle with the bank.

“The mortgage got wiped out, so I have no mortgage payment, everything was completely satisfied,” Castro said.

The woman, who took it upon herself to go through every document related to the mortgage, finally discovered robo-signing. She said the signatures on her foreclosure documents appeared to have been signed by different people.

[NBC 6]

Image Source: ABC

Here are the many different signatures of Scott Anderson below:

© 2010-15 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in STOP FORECLOSURE FRAUDComments (2)

HSBC Bank USA, N.A. v Sene | NYSC “without further hearings, that a FRAUD has been committed UPON this COURT” – “Two Versions of Assignment of Note”

HSBC Bank USA, N.A. v Sene | NYSC “without further hearings, that a FRAUD has been committed UPON this COURT” – “Two Versions of Assignment of Note”


Decided on February 28, 2012

Supreme Court, Kings County

 

HSBC Bank USA, N.A. as Trustee of behalf of ACE Securities Corp. Home Equity Loan Trust And for the Registered Holders of Ace Securities Corp. Home Equity Loan Trust, Series 2007-HE4, Asset Backed Pass-Through Certificates, Plaintiff,

against

Marie Sene, et al, Defendants.

18600/09

Plaintiff was represented by Alissa L. Wilson, Esq., Shapiro, DiCaro & Barak, LLC, 250 Mile Crossing Blvd., Rochester, NY 14624. Defendant was represented by Yolande I. Nicholson, PC, 26 Court St., Brooklyn, NY 11242.

Herbert Kramer, J.

The following papers have been read on this motion:

Notice of Motion/Order to Show Cause/Papers Numbered

Petition/Cross Motion and

Affidavits (Affirmations) Annexed _____________________________

Opposing Affidavits (Affirmations) _______ ______________________

Reply Affidavits (Affirmations)______________________________

_______________(Affirmation)______________________________

Other Papers______________________________

Good faith is absent when two versions of the assignment of the note are presented to the Court. Parties are required to come into the court with clean hands despite having instituted the action prior to the effective date of CPLR §3408.[FN1] [*2]

This matter was referred to this Court for a bad faith hearing under the appropriate statutory scheme. See CPLR §3408.

The instant matter illustrated the wild west mentality that was so prevalent in the early part of this past decade, which allowed for practically anyone breathing to obtain a mortgage by signing their name.[FN2] It appears that the process of securitization of mortgages led to major improprieties, this case being a prime example.

However, all of that pales in significance to what follows. During the bad faith hearing, two separate notes with attendant assignments were put into evidence by the plaintiff.

The first was in Exhibit “C.” of plaintiff’s “1.” which is the summons and complaint filed on July 23, 2009.The note itself was endorsed by Marie Sene, only. In addition, there is an allonge, dated July 15, 2009, with the “effective date” of April 30, 2007, signed by Kevin M. Jackson.[FN3]

The allonge is assigned to “HSBC Bank USA, N.A. as Trustee on behalf of Ace Securities Corp. Home Equity Loan Trust and for the Registered Holders of Ace Securities Corp., Home Equity Loan Trust, Series 2007-HE4, asset backed Pass-Through Certificates, without recourse, representation or warranty express or implied…”

The second note was introduced as Exhibit “E.” of plaintiff’s “1.” labeled as the note and assignment. That note included an endorsement from Marjorie Jorgensen, the Collateral Control Manager or ResMae Mortgage Corporation in addition to Ms. Sene’s signature. There was also a purported allonge which was not permitted into evidence. However, the existence of an allonge does not explain the apparent disparity between the two assignments. Both cannot be accurate.[FN4]

This Court emphatically now joins the judicial chorus who have been wary of the paperwork supplied by plaintiffs and their representatives. There is ample reason for Chief Judge’s requirement for an attorney affirmation in residential foreclosure cases. As stated by [*3]Chief Judge Jonathan Lippman,”we cannot allow the courts in New York State to stand idly and be party to what we now know is a deeply flawed process, especially when that process involves basic human needs-such as a family home-during this period of economic crisis.”[FN5]

Furthermore, the form affidavit which is now required by Administrative Order 548/10 states that “numerous and widespread insufficiencies in foreclosure filings in various courts around the nation were reported by major mortgage lenders and other authorities…”. See also, HSBC Bank v. Taher, 932 N.Y.S2d 760 [2011].[FN6]

It is clear in this case, without further hearings, that a fraud has been committed upon this Court. Thus, the only remedy that can be utilized by this Court is to stay these proceedings and any mortgage foreclosure until this matter is cleared up to the satisfaction of this Court.

Further, in connection with this matter, the litigants were directed to submit memorandums of law on issues that arose during the hearing. Plaintiff submitted an affirmation with exhibits. Therein plaintiff attempts to establish Ocwen’s authority to sign as “attorney in fact” for ResMae corporation.

Allegedly, Ocwen’s authority arises from a limited power of attorney attached as exhibit “H.” to Plaintiff’s “1.” The power of attorney between ResMae Mortgage Corporation (the Servicer) and Ocwen, grants the “express power and authority to, for any mortgage loan transferred by the Servicer to Ocwen under that certain Pooling and Servicing Agreement between the Servicer and Deutsche Bank National Trust Company dated March 1, 2006.”

Oddly, the pooling and servicing agreement submitted as plaintiff’s Exhibit “2.” allegedly evidencing Ocwen’s power of attorney is dated April 1, 2007 and is between Ace Securities Corp., Ocwen Loan Servicing, LLC, GMAC Mortgage, LLC, Wells Fargo Bank, National Association, HSBC Bank USA, NA. These submissions fail to establish that Ocwen was granted authority as ResMae’s attorney-in-fact. Regardless, the defect in the assignments remain.

This Court is further reporting the matter to the District Attorney, Kings County, the Attorney General of the State of New York and the U.S. Attorney for the Eastern District of New York. Copies of the two notes are annexed hereto and made a part hereof.

This constitutes the decision and order of the Court.

J.S.C.

Footnotes

 

Footnote 1:The plaintiff asserts that the language of “good faith” contained in CPLR § 3408 does not apply as this action was commenced prior to the February 13, 2010 amendment. Plaintiff does not argue that the remainder of CPLR 3408 is applicable, which directs settlement conferences in residential foreclosure matters. This Court disagrees with plaintiff that its obligation to act in good faith throughout the litigation is dependent upon a statutory mandate. Honeywell International v. National Avionics Sys. Corp., 343 F.Supp.2d 272 [2004]. “A mortgagee who is invoking the aid of foreclosure action, may be required, as condition precedent to relief, to do equity.” Farmers’ & Mechanics’Sav. Bank of City of Lockport v. Eagle Bldg. Co. et al., 271 N.Y.S. 306 [1934]. This Court has purposefully cited a decision from 1934 due to the discussion found therein as to the devastating economic conditions at that time, and unfortunately finds many parallels to the current economic climate.

Footnote 2: This court was prepared to update its decision regarding reverse redlining and whether the rebuttable presumption followed with the assignment of the note and mortgage. See, M & T Mortgage v. Foy, 858 NYS2d 567 [2008]. In this Court’s view, it is unnecessary to delve into the other legal arguments when faced with the conflicting assignments.

Footnote 3:As manager for Resmae Mortgage Corporation by its attorney-in-fact Ocwen Loan Servicing, LLC

Footnote 4:It should also be noted that ResMae filed for bankruptcy protection in 2007.

Footnote 5:In regards to the issuance of Administrative Order 548/10

Footnote 6:The decision outlines the numerous and widespread irregularities specific to HSBC Bank USA, NA, the plaintiff in this case. A, NA, the plaintiff in this case.

[ipaper docId=83435780 access_key=key-29jb7yoyxz38dwntiqma height=600 width=600 /]

 

© 2010-15 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in STOP FORECLOSURE FRAUDComments (2)

HSBC Bank USA, N.A. v Taher | NY Judge Schack Grand Slam Again… Sanctions HSBC $10k & Shapiro, DiCaro & Barak, LLC $5k

HSBC Bank USA, N.A. v Taher | NY Judge Schack Grand Slam Again… Sanctions HSBC $10k & Shapiro, DiCaro & Barak, LLC $5k


For Part 1 go here: HSBC v TAHER | Judge SCHACK Grand SLAM!! MERS, Plaintiff’s Counsel, Ocwen Robo-Signers Christina Carter, Scott Anderson, Margery Rotundo Dismissed w/ PREJUDICE

Decided on December 22, 2011

Sup Court, Kings County

HSBC Bank USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, Plaintiff,

against

Ellen N. Taher, et. al., Defendants.

9320/09

Appearances:

Plaintiff

William G. Kelly, Esq.

Frank Cassara, Esq.

Shapiro DiCaro and Barak, LLC

Rochester NY

Michael O. Ware, Esq.

Mayer Brown, LLP

NY NY

Marco Cercone, Esq.

Ruup Baase Pfalzgraf Cunningham and Coppola

Buffalo NY

Defendant No Appearance

Arthur M. Schack, J.

The following papers numbered 1 – 7 read on this decision:Papers Numbered:

Affidavits with or without Exhibits1, 2, 3, 4

Memoranda of Law_________________________________5, 6

Transcript of July 15, 2011 Court Proceedings____________7

________________________________________________________________________

The Court, in this dismissed foreclosure action, pursuant to 22 NYCRR § 130-1.1 (a), imposes the following sanctions for “frivolous conduct,” in violation of 22 NYCRR

§ 130-1.1 (c): the maximum sanction of $10,000.00 upon plaintiff, HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2 (HSBC), because HSBC’s use of robosigners in the instant action “is completely without merit in law,” HSBC “asserts material factual statements that are false” and HSBC’s continuation of the action with all its defects is a waste of judicial resources; and, a sanction of $5,000.00 upon HSBC’s counsel, Shapiro, DiCaro & Barak, LLC, because Frank M. Cassara, Esq., of Shapiro, DiCaro & Barak, LLC “asserts material factual statements that are false” and Shapiro, DiCaro & Barak, LLC’s continuation of the action with all its defects is a waste of judicial resources. The Court is not imposing a sanction upon Frank M. Cassara, Esq. because, pursuant to 22 NYCRR § 130-1.1 (b), the sanction is imposed upon Shapiro, DiCaro & Barak, LLC, the “firm . . . with which the attorney is associated.”

The frivolous conduct of HSBC and Shapiro, DiCaro & Barak, LLC is detailed in my prior decision and order in this action (32 Misc 3d 1208 (A) [July 1, 2011]). Further, I conducted a hearing on July 15, 2011, to give HSBC, Frank M. Cassara, Esq. and Shapiro, DiCaro & Barak, LLC a “a reasonable opportunity to be heard” before any imposition of sanctions, pursuant to 22 NYCRR § 130-1.1 (d).

This decision and order is based upon my review of the minutes of the July 15, 2011 Part 130 hearing, my prior orders and decisions in the instant matter and my review of affidavits and memoranda of law submitted by counsel for HSBC and Shapiro, DiCaro & Barak, LLC. Therefore, pursuant to 22 NYCRR § 130-1.2, this is the “written decision setting forth the conduct on which the award or imposition [of sanctions] is based, the reasons why the court found the conduct to be frivolous, and the reasons why the court found the amount awarded or imposed to be appropriate.”

Background

Plaintiff HSBC moved in this foreclosure action, upon the default of all defendants, for an order of reference and related relief for the premises located at 931 Gates Avenue, Brooklyn, New York (Block 1632, Lot 57, County of Kings). On November 8, 2010, I issued a decision and order instructing plaintiff’s counsel, Shapiro, DiCaro & Barak, LLC, to comply with the affirmation requirements of Administrative Order 548/10, issued, on October 20, 2010, by then Chief Administrative Judge Ann T. Pfau. Shapiro, DiCaro & Barak, LLC was ordered to submit the required affirmation “within sixty (60) days of this decision and order, or the instant foreclosure action will be dismissed with prejudice.” Moreover, my decision and order mandated, with respect to the attorney’s affirmation, that: [*2]

plaintiff’s counsel to state that he communicated on a specific date

with a named representative of plaintiff HSBC who informed counsel

that he or she:

(a) has personally reviewed plaintiff’s documents and records

relating to this case; (b) has reviewed the Summons and

Complaint, and all other papers filed in this matter in support

of foreclosure; and, (c) has confirmed both the factual accuracy

of these court filings and the accuracy of the notarizations

contained therein.

Further, plaintiff’s counsel, based upon his or her communication

with plaintiff’s representative named above must upon his or her

“inspection of the papers filed with the Court and other diligent

inquiry, . . . certify that, to the best of [his or her] knowledge, information

and belief, the Summons and Complaint filed in support of this action

for foreclosure are complete and accurate in all relevant respect.”

Counsel is reminded that the new standard Court affirmation form

states in a note at the top of the first page:

During and after August 2010, numerous and widespread

insufficiencies in foreclosure filings in various courts around the

nation were reported by major mortgage lenders and other authorities.

These insufficiencies include: failure of plaintiffs and their counsel

to review documents and files to establish standing and other foreclosure requisites; filing of notarized affidavits which falsely attest to such

review and to other critical facts in the foreclosure process; and

“robosigning” of documents by parties and counsel. The wrongful

filing and prosecution of foreclosure proceedings which are discovered

to suffer from these defects may be cause for disciplinary and other

sanctions upon participating counsel. [Emphasis added]

The Office of Court Administration, in its October 20, 2010 press release about the

new affirmation requirement, stated that the new attorney affirmation filing requirement was instituted:

to protect the integrity of the foreclosure process and prevent wrongful foreclosures . . . The new filing requirement was introduced by the Chief [*3]

Judge in response to recent disclosures by major mortgage lenders of

significant insufficiencies — including widespread deficiencies in

notarization and “robosigning” of supporting documents — in residential

foreclosure filings in courts nationwide . . .

Chief Judge Lippman said, “We cannot allow the courts

in New York State to stand by idly and be party to what we now

know is a deeply flawed process, especially when that process

involves basic human needs — such as a family home — during

this period of economic crisis. This new filing requirement will

play a vital role in ensuring that the documents judges rely on will

be thoroughly examined, accurate, and error-free before any judge

is asked to take the drastic step of foreclosure.” [Emphasis added]

On January 7, 2011, HSBC’s deadline day to submit the required affirmation, Mr.

Cassara, of Shapiro, DiCaro & Barak, LLC, submitted to my chambers the required affirmation. Mr. Cassara, affirmed “under the penalties of perjury”:

2. On January 4, 2011 and January 5, 2011, I communicated with

the following representative or representatives of Plaintiff, who informed

me that he/she/they (a) personally reviewed plaintiff’s documents and

records relating to this case for factual accuracy; and (b) confirmed

the factual accuracy and allegations set forth in the Complaint and

any supporting affirmations filed with the Court, as well as the accuracy

of the notarizations contained in the supporting documents filed there with.

Name Title

Christina Carter Manager of Account Management

3. Based upon my communication with Christina Carter, as well

as upon my inspection and reasonable inquiry under the circumstances,

I affirm that, to the best of my knowledge, information, and belief, the

Summons and Complaint, and other papers filed or submitted to the

Court in this matter contain no false statements of fact or law . . .

4. I am aware of my obligations under New York Rules of Professional

Conduct (22 NYCRR Part 1200) and 22 NYCRR Part 130. [Emphasis [*4]

added]

However, the Court discovered problems with Mr. Cassara’s affirmation and the subject foreclosure action. Plaintiff HSBC lacked standing to commence the instant foreclosure action because the assignment to HSBC of the subject mortgage and note by MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. (MERS) was without legal authority. MERS never possessed the TAHER note it allegedly assigned to plaintiff HSBC. Therefore, the Court dismissed the instant action with prejudice because HSBC did not have standing to commence the action.

Then, I held at * 2-3, of my July 1, 2011 decision and order:

Mr. Cassara’s affirmation, affirmed “under the penalties of

perjury,” that to the best of Mr. Cassara’s “knowledge, information,

and belief, the Summons and Complaint, and other papers filed or

submitted to the Court in this matter contain no false statements of

fact or law,” is patently false. Moreover, the Court is troubled that:

the alleged representative of plaintiff HSBC, Christina Carter, who

according to Mr. Cassara, “confirmed the factual accuracy and

allegations set forth in the Complaint and any supporting affirmations

filed with the Court, as well as the accuracy of the notarizations

contained in the supporting documents filed therewith,“is not an

employee of HSBC, but a robosigner employed by OCWEN LOAN

SERVICING, LLC [OCWEN], whose signature on legal documents

has at least three variations; the MERS to plaintiff HSBC assignment

of the subject mortgage and note was executed by Scott W. Anderson,

a known robosigner and OCWEN employee, whose signature is

reported to have appeared in at least four different variations on

mortgage assignments; and, the instant affidavit of merit was executed

by Margery Rotundo, another robosigner, OCWEN employee and self-

alleged employee of various other banking entities . . .

Last month, on May 19, 2011, in a case involving a defective

MERS to HSBC assignment by a robosigner, Maine’s highest court,

the Supreme Judicial Court, found that HSBC’s affidavits and the

assignment of the note and mortgage by MERS to HSBC contained

serious defects. The Maine Court held “that the affidavits submitted [*5]

by HSBC contain serious irregularities that make them inherently

untrustworthy.” (HSBC Mortg. Services, Inc. v Murphy, 19 A3d 815,

820). HSBC has a history of foreclosure actions before me with

affidavits of merit executed by Margery Rotundo and MERS to

HSBC assignments executed by Scott Anderson that “contain serious

irregularities that make them inherently untrustworthy.” Moreover,

Mr. Cassara was put on notice, in my November 8, 2010 decision and

order, that “[t]he wrongful filing and prosecution of foreclosure

proceedings which are discovered to suffer from these defects may

be cause for disciplinary and other sanctions upon participating counsel.”

Moreover, in my July 1, 2011 decision and order, at * 3, I emphasized to plaintiff HSBC’s counsel that:

Chief Judge Jonathan Lippman, in the Office of Court

Administration’s October 20, 2010 press release about the issuance of

Administrative Order 548/10 and the need for plaintiff’s counsel in

foreclosure actions to verify the accuracy of supporting documents,

stated that “[w]e cannot allow the courts in New York State to stand by

idly and be party to what we now know is a deeply flawed process,

especially when that process involves basic human needs — such as

a family home — during this period of economic crisis.” Frivolous

conduct, as defined by 22 NYCRR § 130.1.1 (c), includes conduct that

“is completely without merit in law” and “asserts material factual

statements that are false.” Further, the Part 130 rules are intended to

stop the waste of judicial resources, which appears to have occurred in

the TAHER foreclosure action. In the instant action: the assignment of

the subject mortgage and note by MERS to HSBC is without legal

authority; HSBC’s continued use of robo-signers “is completely without

merit in law”; plaintiff HSBC “asserts material factual statements that

are false”; and, the continuation of this case with all its defects is a

waste of judicial resources. Therefore, plaintiff HSBC’s President and

Chief Executive Officer, Irene M. Dorner, its counsel, Frank M. Cassara, [*6]

Esq., and his firm, Shapiro, DiCaro & Barak, LLC, will be given an

opportunity to be heard why this Court should not sanction them for

making a “frivolous motion,” pursuant to 22 NYCRR §130-1.1.

In my July 1, 2011 decision and order, I found that defendant TAHER’s lender, DELTA FUNDING CORPORATION (DELTA), pursuant to the terms of a consolidation, extension and modification agreement, not MERS, was the “Note Holder.” Despite this, MERS assigned DELTA’s consolidation, extension and modification agreement and note to HSBC, in an assignment executed by Scott W. Anderson, as “Senior Vice President of Residential Loan Servicing” for “MORTGAGE ELECTRONIC REGISTRATIONS SYSTEMS, INC., as nominee for DELTA FUNDING CORPORATION by its attorney-in-fact OCWEN LOAN SERVING, LLC.” I noted that both assignor MERS and assignee HSBC have the same address, 1661 Worthington Road, Suite 100, West Palm Beach, FL 33409, which is OCWEN’s address. Also, Mr.

Anderson’s assignment referred to a recorded power of attorney from DELTA to OCWEN, which upon my inspection proved to be a limited power of attorney from DELTA to OCWEN for a different address.

With respect to robosigner Scott Anderson, I observed in my July 1, 2011 decision and order, at * 5, that:

the Ohio Court of Appeals, Second District, Montgomery County

(2010 WL 3451130, 2010-Ohio-4158, lv denied 17 Ohio St.3d 1532

[2011]), affirmed the denial of a foreclosure, sought by plaintiff

HSBC, because of numerous irregularities. The Ohio Court, in

citing four decisions by this Court [three of the four involved Scott

Anderson as assignor] summarized some of this Court’s prior concerns

with HSBC and Mr. Anderson, in observing, at * 11:

recent decisions in the State of New York have noted numerous

irregularities in HSBC’s mortgage documentation and corporate

relationships with Ocwen, MERS, and Delta. See, e.g., HSBC

Bank USA, N.A. v Cherry (2007), 18 Misc 3d 1102 (A) [Scott

Anderson assignor] and HSBC Bank USA, N.A. v Yeasmin

(2010), 27 Misc 3d 1227 (A) (dismissing HSBC’s requests for

orders of reference in mortgage foreclosure actions, due to

HSBC’s failure to provide proper affidavits). See, also, e.g.,

HSBC Bank USA, N.A. v Charlevagne (2008), 20 Misc 3d

1128 (A) [Scott Anderson assignor] and HSBC Bank USA,

N.A. v Antrobus (2008), 20 Misc 3d 1127 (A) [Scott Anderson

assignor] (describing “possible incestuous relationship” between

HSBC Bank, Ocwen Loan Servicing, Delta Funding Corporation, [*7]

and Mortgage Electronic Registration Systems, Inc., due to the fact

that the entities all share the same office space at 1661 Worthington

Road, Suite 100, West Palm Beach, Florida. HSBC also supplied

affidavits in support of foreclosure from individuals who

claimed simultaneously to be officers of more than one of these corporations.).

I reviewed Scott Anderson’s signature in the instant MERS to HSBC assignment and then went to the Automated City Register Information System (ACRIS) of the New York City Register to compare Mr. Anderson’s signature with that used in five prior Scott Anderson foreclosure cases decided by this Court. I found that Mr. Anderson used five variations of his initials, “SA,” but never signed his name in full.

Also, I found that Margery Rotundo, who executed the April 27, 2009 affidavit of merit and amount due in the instant action, at * 7 of my July 1, 2011 decision and order, had “in prior foreclosure cases before me, a history of alleging to be the Senior Vice President of various entities, including plaintiff HSBC, Nomura Credit & Capital, Inc. and an unnamed servicing agent for HSBC. In the instant action she claims to be the Senior Vice President of Residential Loss Mitigation of OCWEN, HSBC’s servicing agent.”

Then, with respect to Christina Carter, at * 8 of my July 1, 2011 decision and order, I observed:

Mr. Cassara, plaintiff’s counsel affirmed that “On January 4,

2011 and January 5, 2011, I communicated with the following

representative . . . of Plaintiff . . . Christina Carter . . . Manager of

Account Management.” This is disingenuous. Ms. Carter is not

employed by plaintiff, but by OCWEN. She executed documents as

an officer of MERS and as an employee of OCWEN. Ms. Carter’s

signature on documents is suspect because of the variations of her

signature used.

This Court examined eight recent documents that exhibit

three different variations of Christina Carter’s signature.

In my July 1, 2011 decision and order, I explained in detail why HSBC failed to have standing to assign the subject mortgage and note, holding at * 10, that “[i]n the instant action, even if MERS had authority to transfer the mortgage to HSBC, DELTA, not MERS, is the note holder. Therefore, MERS cannot transfer something it never proved it possessed.” I cited Aurora Loan Services, LLC v Weisblum (85 AD3d 95, 108 [2d Dept May 14, 2011]), which holds:

In order to commence a foreclosure action, the plaintiff must

have a legal or equitable interest in the mortgage (see Wells Fargo

Bank, N.A. v Marchione, 69 AD3d, 204, 207 [2d Dept 2009]). A

plaintiff has standing where it is both (1) the holder or assignee of

the subject mortgage and (2) the holder or assignee of the underlying

note, either by physical delivery or execution of a written assignment

prior to the commencement of the action with the filing of the complaint

(see Wells Fargo Bank, N.A. v Marchione, 69 AD3d at 207-209; U.S. [*8]

Bank v Collymore, 68 AD3d 752, 754 [2d Dept 2009].)

Moreover, in my July 1, 2011 decision and order, with respect to the authority of MERS as nominee to assign a mortgage and note, I held, at * 10:

Scott Anderson for MERS as assignor, did not have specific

authority to sign the TAHER mortgage. Under the terms of the

consolidation, extension and modification agreement, MERS is

“acting solely as nominee for Lender [DELTA].” The alleged power

of attorney cited in the Scott Anderson MERS to HSBC assignment,

as described above, is a limited power of attorney from DELTA to

OCWEN for the premises located at 14 Harden Street, Brooklyn,

New York, not the subject premises. MERS is not mentioned or

involved with this limited power of attorney. In both underlying

TAHER mortgages MERS was “acting solely as a nominee for

Lender,” which is DELTA. The term “nominee” is defined as “[a]

person designated to act in place of another, usu. in a very limited

way” or “[a] party who holds bare legal title for the benefit of others.”

(Black’s Law Dictionary 1076 [8th ed 2004]). “This definition suggests

that a nominee possesses few or no legally enforceable rights beyond

those of a principal whom the nominee serves.” (Landmark National Bank v Kesler, 289 Kan 528, 538 [2009]).

Then, I held, at * 12-13 of my July 1, 2011 decision and order, that MERS, as DELTA’s nominee, its agent for limited purposes, lacked authority to assign the TAHER consolidation, extension and modification agreement, because:

several weeks ago, the Appellate Division, Second Department in

Bank of New York v Silverberg, (86 AD3d 274 [June 7, 2011]),

confronted the issue of “whether a party has standing to commence

a foreclosure action when that party’s assignor—in this case, Mortgage

Electronic Registration Systems, Inc. (hereinafter MERS)—was listed

in the underlying mortgage instruments as a nominee and mortgagee

for the purpose of recording, but was never the actual holder or

assignee of the underlying notes.” The Court held, “[w]e answer

this question in the negative.” Silverberg, similar to the instant [*9]

TAHER matter, deals with the foreclosure of a mortgage with a

consolidation, modification and extension agreement. MERS, in

the Silverberg case and the instant TAHER action, never had title

or possession of the Note and the definition of “Note Holder” is

substantially the same in both consolidation, extension and modification agreements. The Silverberg Court instructed, at 281-282:

the assignment of the notes was thus beyond MERS’s authority

as nominee or agent of the lender (see Aurora Loan Servs.,

LLC v Weisblum, 2011 NY Slip Op 04184, *6-7 [2d Dept

2011]; HSBC Bank USA v Squitteri, 29 Misc 3d 1225 [A]

[Sup Ct, Kings County, F. Rivera, J.]; ; LNV Corp. v Madison

Real Estate, LLC, 2010 NY Slip Op 33376 [U] [Sup Ct, New

York County 2010, York, J.]; LPP Mtge. Ltd. v Sabine Props.,

LLC, 2010 NY Slip Op 32367 [U] [Sup Ct, New York County

2010, Madden, J.]; Bank of NY v Mulligan, 28 Misc 3d 1226 [A]

[Sup Ct, Kings County 2010, Schack, J.]; One West Bank,

F.S.B., v Drayton, 29 Misc 3d 1021[Sup Ct, Kings County

2010, Schack, J.]; Bank of NY v Alderazi, 28 Misc 3d 376,

379-380 [Sup Ct, Kings County 2010, Saitta, J.] [the “party

who claims to be the agent of another bears the burden of

proving the agency relationship by a preponderance of the

evidence”]; HSBC Bank USA v Yeasmin, 24 Misc 3d 1239 [A]

[Sup Ct, Kings County 2010, Schack, J.]; HSBC Bank USA,

N.A. v Vasquez, 24 Misc 3d 1239 [A], [Sup Ct, Kings County

2009, Schack, J.]; Bank of NY v Trezza, 14 Misc 3d 1201 [A]

[Sup Ct, Suffolk County 2006, Mayer, J.]; La Salle Bank Natl.

Assn. v Lamy, 12 Misc 3d 1191 [A] [Sup Ct, Suffolk County,

2006, Burke, J.]; Matter of Agard, 444 BR 231 [Bankruptcy

Court, ED NY 2011, Grossman, J.]; but see U.S. Bank N.A. v

Flynn, 27 Misc 3d 802 [Sup Ct, Suffolk County 2011, Whelan,

J.]).

Moreover, the Silverberg Court concluded, at 283, that “because [*10]

MERS was never the lawful holder or assignee of the notes described

and identified in the consolidation agreement, the . . . assignment of

mortgage is a nullity, and MERS was without authority to assign the

power to foreclose to the plaintiff. Consequently, the plaintiff failed

to show that it had standing to foreclose.” Further, the Silverberg

Court observed, at 283, “the law must not yield to expediency and

the convenience of lending institutions. Proper procedures must

be followed to ensure the reliability of the chain of ownership, to secure

the dependable transfer of property, and to assure the enforcement of

the rules that govern real property.” [Emphasis added]

Therefore, the instant action is dismissed with prejudice.

Thus, because of: the defects found in Mr. Cassara’s January 6, 2011 affirmation,

affirmed, “under the penalties of perjury”; the warning to plaintiff’s counsel that “[t]he wrongful filing and prosecution of foreclosure proceedings which are discovered to suffer from these defects may be cause for disciplinary and other sanctions upon participating counsel”; plaintiff HSBC’s lack of standing to bring the instant action; plaintiff HSBC’s complaint being replete with false statements, such as alleging its offices were located at 1661 Worthington Road, Suite 100, West Palm Beach, FL 33409, which is actually OCWEN’s office, and that it owned the TAHER note, which it did not; the use in the instant foreclosure of three robosigners – Scott Anderson, Margery Rotundo and Christina Carter; and, the waste of judicial resources, in this matter, with defective paperwork and robosigners; I ordered, at * 17, of my July 1, 2011 decision and order, that:

the Court will examine the conduct of plaintiff HSBC and plaintiff’s

counsel, in a hearing, pursuant to 22 NYCRR § 130-1.1, to determine

if plaintiff HSBC, by its President and CEO, Irene M. Dorner, and

plaintiff’s counsel Frank M. Cassara, Esq. and his firm Shapiro, DiCaro

& Barak, LLC, engaged in frivolous conduct, and to allow plaintiff

HSBC, by its President and CEO, Irene M. Dorner, and plaintiff’s

counsel Frank M. Cassara, Esq. and his firm Shapiro, DiCaro &

Barak, LLC a reasonable opportunity to be heard.

With respect to HSBC’s President and CEO, Irene M. Dorner, I noted, at * 17 of my July 1, 2011 decision and order:

plaintiff HSBC’s President and Chief Executive Officer (CEO)

bears a measure of responsibility for plaintiff’s actions, as well as

plaintiff’s counsel . . . Dorner . . . is HSBC’s “captain of the ship.”

She should not only take credit for the fruits of HSBC’s victories but

must bear some responsibility for its defeats and mistakes. According

to HSBC’s 2010 Form 10-K, dated December 31, 2010, and filed with

the U.S. Securities and Exchange Commission on February 28, 2011, [*11]

at p. 255, “Ms. Dorner’s insight and particular knowledge of HSBC

USA’s operations are critical to an effective Board of Directors” and

Ms. Dorner “has many years of experience in leadership positions

with HSBC and extensive global experience with HSBC, which is

highly relevant as we seek to operate our core businesses in support

of HSBC’s global strategy.” HSBC needs to have a “global strategy”

of filing truthful documents and not wasting the very limited resources

of the Courts. For her responsibility she earns a handsome compensation

package. According to the 2010 Form 10-K, at pp. 276-277, she earned

in 2010 total compensation of $2,306,723. This included, among other

things: a base salary of $566,346; a discretionary bonus of $760,417;

and, other compensation such as $560 for financial planning and

executive tax services; $40,637 for executive travel allowance,

$24,195 for housing and furniture allowance, $39,399 for relocation

expenses and $3,754 for executive physical and medical expenses.

Opposition papers to sanctions

OCWEN, as attorney-in-fact for HSBC, on July 12, 2011, substituted Ruppe, Baase, Pfalzgraf, Cunningham, Coppola, LLC for Shapiro, DiCaro & Barak, LLC, as counsel for HSBC. Ruppe, Baase, Pfalzgraf, Cunningham, Coppola, LLC submitted to the Court papers opposing sanctions against HSBC.

However, it appears to the Court that HSBC was never notified by OCWEN or Ruppe, Baase, Pfalzgraf, Cunningham, Coppola, LLC that they were being represented at the July 15, 2011 hearing. On July 15, 2011, at about 12:40 P.M., less than two hours before the sanctions hearing was scheduled to commence, a messenger from the “white-shoe” law firm Mayer Brown, LLP delivered to my chambers, an affidavit, with exhibits, executed that day by Thomas Musarra, alleging to be “a senior vice president of HSBC Bank USA” and “the head of HSBC’s Corporate Trust and Loan Agency Transaction Management Department, the unit responsible for HSBC’s work as trustee or indenture trustee in residential mortgage-backed securities transactions.” Mr. Mussara “being duly sworn” states, in ¶ 4, of his affidavit that “[m]y department has no record of the loan to defendant Eileen Taher being brought to our attention by the Servicer [OCWEN] or otherwise until last week.” Michael Ware, Esq., of Mayer Brown, LLP, in his Memorandum of Law, attached to the Musarra affidavit, claims that his Memorandum of Law was submitted for HSBC and Irene M. Dorner “in its corporate capacity and not as Indenture Trustee for the Registered Noteholders of Renaissance Home Equity Loan Trust 2007-2.”

However, Mayer Brown, LLP, pursuant to CPLR § 1013, never moved by motion to intervene in the instant action for HSBC “in its corporate capacity and not as Indenture Trustee for the Registered Noteholders of Renaissance Home Equity Loan Trust 2007-2,” if that is even possible. The poet Gertrude Stein wrote in Sacred Emily that a “Rose is a rose is a rose is a rose” and William Shakespeare wrote in Romeo and Juliet that “A rose by any other name would smell as sweet.” HSBC, whether in its corporate capacity or as an Indenture Trustee, is HSBC, whether it smells sweet or otherwise. Therefore, HSBC is HSBC is HSBC is HSBC.

Goldberg Segalla, LLP represented Shapiro, DiCaro & Barak, LLC and Frank M. Cassara, [*12]Esq. at the July 15, 2011 hearing. John A. DiCaro, Esq., a member of Shapiro, DiCaro & Barak, LLC, submitted an affidavit and memorandum of law opposing sanctions.

Plaintiff HSBC’s various counsel and Shapiro, DiCaro & Barak, LLC, in their opposition affidavits and memoranda of law, devote most of their opposition to my rationale for the July 1, 2011 decision and order, dismissing the instant action with prejudice and ordering a Part 130 sanctions hearing. I will not engage in debate with counsel for HSBC or Shapiro, DiCaro & Barak, LLC about my reasoning in the July 1, 2011 decision and order. As of today, neither HSBC’s counsel, whether it is Ruppe, Baase, Pfalzgraf, Cunningham, Coppola, LLC or Mayer Brown, LLP, nor Shapiro, DiCaro & Barak, LLC have moved for leave to renew or reargue my July 1, 2011 decision and order or file a notice of appeal. If HSBC’s various counsel and/or Shapiro, DiCaro & Barak, LLC dispute any part of my July 1, 2011 decision and order, why are they sitting on their hands?

Further, as indicated by the Musarra affidavit and the Michael Ware Memorandum of Law, HSBC sounds like a combination of Pontius Pilate and Sergeant Schultz in the classic 1960’s television comedy, Hogan’s Heroes. HSBC washes its hands of any responsibility and places any blame upon OCWEN, its servicer for the TAHER mortgage. To paraphrase Matthew 27:24, in the New Testament, “when HSBC saw that it could prevail nothing, but that rather a tumult was made, it took water, and washed its hands before the multitude, saying, ‘I am innocent of responsibility and should not be sanctioned.'” John Banner, the actor who played the inept Sergeant Hans Schultz, a guard in World War II’s Stalag 13, would feign ignorance about the escapades of his Allied prisoners by telling his commandant, Colonel Klink, “I know nothing! Nothing!”Moreover, Mr. Ware, in his Memorandum of Law, at page 3, states that “[t]he

administration of mortgage loans owned by the Trust is Ocwen’s responsibility under the Servicing Agreement reproduced as Musarra Ex. B” and “[g]iven the respective responsibilities of the Indenture Trustee and the Servicer, it is no suprise that the Taher loan never came to the attention of the relevant department of HSBC until after the July 1 Order became public.” Mr. Ware, concludes, at page 5, “[I]f sanctionable misconduct took place here, the Court should bear in mind that neither HSBC nor Dorner was in any practical position to control the prosecution of this action.”

July 15, 2011 Part 130 hearing for costs and sanctions

The first issue I had to address at the July 15, 2011 Part 130 hearing was determining who represented HSBC. Marco Cercone, Esq. of Ruppe, Baase, Pfalzgraf, Cunningham, Coppola, LLC answered for HSBC and satisfactorily explained to my satisfaction that OCWEN’s Assistant General Counsel substituted Ruppe, Baase, Pfalzgraf, Cunningham, Coppola, LLC for Shapiro DiCaro & Barak, LLC, pursuant to a power of attorney from HSBC to OCWEN. I then addressed Mr. Ware, and asked him how he could represent HSBC, if Mr. Cercone represented HSBC. Mr. Ware attempted to make a distinction between HSBC as an indenture trustee and in its corporate capacity. The following colloquy took place at the hearing, p. 7, line 19 – p. 10, line [*13]22:

THE COURT: Wouldn’t you have to file for intervener

status by motion?

MR. WARE: Certainly. We read the order of July 1st as making

Irene Dorner a respondent at today’s hearing.

THE COURT: . . . I ordered Ms. Dorner to appear because she’s

the President and CEO of HSBC USA, N.A. as indenture trustee.

Whatever you call it, she’s the head of HSBC. We could agree on that?

MR. WARE: Yes.

THE COURT: She’s the President and CEO of HSBC USA.

They’re the indenture trustee. That’s what the caption said. As I

said in my decision, in effect, to look at HSBC as a firm. She’s the

captain of the ship. She has to take responsibility for the good and

bad, like the manager of a baseball team. If HSBC is a baseball

team, if the team wins, you get a lot more money, a lot of aggravation.

Your team come in last, you get fired, you’re gone, you’re history,

adios. That’s what she has to bear here.

Because I have problems here with this case, and I want to get

to the bottom of what happened, I haven’t made any rulings. I didn’t

say there should be sanctions. I want to give everybody a chance to

be heard it there’s sanctionable conduct here. That’s how my order

appears. So based on that, I know Mr. Cercone represents her. Since

now her attorney-in-fact is now substituting his firm for Shapiro and

DiCaro, and you’re suddenly telling me that they don’t represent Irene

Dorner, HSBC, fascinating.

So, who represents HSBC, your or him? I don’t know. Basically,

right now he does. He just proved to me he has a power of attorney.

So the only thing I could think of, if I can split that hair and allow you

to intervene on behalf of – – what I’ll call corporate HSBC, as opposed

to indenture trustee HSBC, is that you have to file a motion on papers,

which you have not. [*14]

MR. WARE: Well, I certainly appear, your Honor, for Ms. Dorner.

THE COURT: Well, I’ll cut through the chase because I read your

papers. For argument’s sake, let’s play this out to the end. Suppose I find

that HSBC did something that requires sanctions? Dismiss as a party?

I know Ms. Dorner is the President and CEO, not an individual. I know

I can’t sanction Ms. Dorner. If that’s what the company is, it’s HSBC

that I might be able to sanction, not Ms. Dorner as an individual. I’ll

grant you that much.

Now that we’ve got Ms. Dorner protected as an individual, but

not HSBC, how are you here in the case? You didn’t file to intervene.

Unless you pull a rabbit out of your hat, in about a moment, I am going

to ask you to leave.

You’re going to stay in the room, obviously. This is a public

courtroom, but I don’t see how you can sit at the table. You’re not in

the case. HSBC, is it your firm or Mr. Cercone’s firm? If you

want to confer with him, I’ll allow you a moment to confer with him.

It’s up to you.

MR. WARE: The foreclosure is entrusted to the servicer. Ocwen

as the servicer is entitled to control the action that is now dismissed.

THE COURT: Okay.

MR. WARE: So we’re here in the aftermath of the dismissal of

the action to address the issues in the order of July 1st.

THE COURT: To use your term aftermath, in the aftermath,

doesn’t Mr. Cercone speak for HSBC since they’re the parties in the

aftermath as indenture trustee, or are you telling me he doesn’t represent

HSBC, you do? Who represents HSBC or is this going to be – – let’s

throw Ocwen under the bus because we didn’t do anything. That seems

to be the defense.

The defense is we didn’t do anything. Ocwen did it. That’s

what you’re telling me.

MR. WARE: Well, it’s certainly true, as a matter of fact, your

Honor, that – – [*15]

THE COURT: That’s what you say.

Ultimately, I allowed Mr. Ware to sit in the well next to Mr. Cercone and act as his co-counsel, but not to intervene in the case, since “corporate” HSBC did not make a motion on notice to intervene. This was done after the following exchange, at p. 11, line 9 – p. 12, line 20.

THE COURT: But here’s the problem. HSBC’s name is in the

caption. They’re the Plaintiff as indenture trustee, et cetera. So now I

find there’s a question about what occurred in this particular case in

terms of whether or not there’s something that is sanctionable.

The question is somebody has to represent HSBC. Mr. Cercone

has been substituted for Shapiro and DiCaro. He showed me the power

of attorney as I asked him to do. You magically appear.

Somebody gives these papers to me at 12:40 this afternoon, and

you say Mayer Brown, LLP is the attorney for HSBC in its corporate

capacity and not as an indenture trustee, but nowhere in the caption did

I see HSBC in its corporate capacity as a party. Therefore, you’re

attempting to intervene without making a motion.

MR. WARE: I understand you’re point, your Honor. Let me

make one point on it and then a suggestion, which is that we thought

the reading of the order of July 1st is that the bank’s assets were

imperiled by this order.

THE COURT: Imperiled. You know HSBC is a corporation.

They can afford to pay Ms. Dorner $2.3 million a year without blinking

an eyelash. What’s the worst that Judge Schack can do? Sanction them?

What’s the worst I can sanction the bank? $10,000. I don’t think it’s

going to affect the bottom line too much.

Right now . . . HSBC will not file for chapter 11 because of

whatever I do one way or the other.

MR. WARE: HSBC didn’t even get touched, your Honor.

THE COURT: I’m glad to hear that.

MR. WARE: I would be happy to be of counsel to him [Mr.

Cercone] with him as trial counsel and counsel of record for HSBC Bank.

With HSBC’s representation finally resolved, the Court inquired about HSBC’s missing President and CEO, Irene M. Dorner, who was ordered, in my July 1, 2011 decision and order, to [*16]appear for the Part 130 hearing. The following colloquy took place, at p. 15, line 1 – p. 16, line 2:

THE COURT: Now we come to why I brought everybody here.

Let me ask Mr. Cercone a question. I have obviously counsel here, Mr.

Cassara, and we have Shapiro DiCaro and Barak. You’re producing

Ms. Dorner on behalf of HSBC?

MR. CERCONE: I am not, Judge. She’s out of the country;

she’s unavailable.

THE COURT: Where out of the country?

MR. CERCONE: I do not know.

THE COURT: You don’t communicate with your client?

MR. CERCONE: I have not communicated with Ms. Dorner.

THE COURT: Maybe you can whisper in his [Mr. Ware, seated

next to Mr. Cercone] ear, and he can whisper something to you. Maybe

he knows where she is.

MR. CERCONE: She’s aware, and she appeared by counsel.

THE COURT: She’s aware. Is she away or on the lam? Where

is she? She’s not here.

MR. CERCONE: She’s not here, Judge.

THE COURT: Why is she violating the court order?

MR. CERCONE: I don’t believe she’s violating the court order,

Judge, because she’s here by counsel.

THE COURT: That’s your opinion for the moment.

Then, the Court reviewed the factual history of the case, including: the use of robosigners Christina Carter and Scott Anderson; HSBC’s lack of standing with the ineffective MERS to HSBC assignment; and, HSBC’s admission, in a prior case before me, HSBC Bank USA v Yeasmin, 24 Misc 3d 1239 (A), that HSBC doesn’t properly determine risk when buying mortgage loans in default. I then made the following statement, at p. 20, line 19 – p. 21, line 16:

Why do I have to waste my time on this? You know we have very

limited resources in our court system. You saw it today. We had to

wait to get a court officer. We probably have 25 less court officers in

this building now, approximately. I don’t know the number we had last

year at this time.

Between buy-outs, people retired, layoffs, the government and [*17]

legislative cuts, the Court’s budget, we have to cut off trials at 4:30, but

the workload increases. So we’re busy. I would like to have serious

cases that have serious issues to deal with rather than deal with these

things which are ridiculous. But I have to deal with this foreclosure.

I have to deal with what is in front of me.

That’s why I have a question of whether or not the conduct that

occurred here . . . is sanctionable, whether it be by HSBC or its attorneys.

That’s why I called for this hearing. So my first question would be with

respect to Shapiro and DiCaro, and Mr. Cassara. My question is, how

could I get an affirmation on whether everything is accurate when it’s not?

Mr. Cassara was sworn in a witness and questioned by his counsel. After his attorney asked questions, I then inquired about HSBC’s use of robosigners, Scott Anderson, Margery Rotundo and Christina Carter. The following exchange took place at p. 25, line 11 – p. 28, line 2:

THE COURT: You gave me an affirmation, as I mentioned, dated

January 6, 2011, and you say you spoke to a representative of Plaintiff.

How come you didn’t say she worked for Ocwen?

THE WITNESS: To be honest with you, Your Honor, when

the word representative of the Plaintiff – – Ocwen is their authorized

agent to handle their loan servicing , and I believed, and I still believe

that representative meant someone who represents – -

THE COURT: Don’t you think it would be helpful for the Court

when you put her name in here [the Affirmation] if it said Manager of

Account Management for Ocwen Loan Servicing as servicer or something

to that effect?

THE WITNESS: Now, yes, your Honor. Now I believe if the

Court would have inquired, I would have indicated such, to be honest

with you. At the time, and I still do believe, the word representative

meant the servicing agent or any party – -

THE COURT: Put the Court to the side for a moment. Somebody

is the reader of this affirmation. And they see the name Christina Carter

is the person you spoke to and communicated with. It says, “Manager of

Account Management.”

Wouldn’t somebody assume she’s employed by HSBC, not [*18]

another entity?

THE WITNESS: To be honest with you, your Honor, I believe

that a representative of the Plaintiff was the servicer. There was no

intent to deceive, certainly – -

THE COURT: Doesn’t it sort of fog the issue or create some

confusion that she does not work for HSBC?

THE WITNESS: Your Honor, I believe she was a representative

of the Plaintiff, that’s sincere.

THE COURT: Then you say everything is accurate. . . the assignor

has the same address as the assignee.

That’s a little bizarre, or try it another way. Scott Anderson, how

does he become both the assignor and the assignee?

THE WITNESS: I’m sorry, your Honor – -

THE COURT: Scott Anderson is the alleged Vice President of

MERS. Are you aware that he is employed by Ocwen?

THE WITNESS: Yes.

THE COURT: And he’s the assignor. Who is the assignee of

Ocwen? Isn’t he conflicted?

THE WITNESS: I’m not following.

THE COURT: Scott Anderson is not conflicted?

THE WITNESS: Your Honor, I believe – -

THE COURT: You believe he is?

THE WITNESS: I don’t know the answer.

THE COURT: Better speak up. That’s one question. Margery

Rotundo signed the affidavit of merit. You’re aware of the fact that

she wears three or four different corporate hats in cases before me?

THE WITNESS: I was not aware or do not recall it was.

THE COURT: And then you’ve got Christina Carter who wears

many hats. This woman you spoke to, are you aware of that also?

THE WITNESS: I was not aware of that as well.

THE COURT: So you’re not aware of that?

THE WITNESS: Okay. [*19]

After further attempts by counsel for HSBC and Shapiro, DiCaro & Barak, LLC to argue about the rationale for my July 1, 2011 decision and order, I concluded the hearing and reserved decision.

Frivolous conduct and 22 NYCRR § 130-1.1

22 NYCRR § 130-1.1 (a) allows the Court, in its discretion, to “impose financial

sanctions upon any party or attorney in a civil action or proceeding who engages in frivolous conduct as defined in this Part, which shall be payable as provided in section 130-1.3 of this Part.” 22 NYCRR § 130-1.1 (c) states that:

conduct is frivolous if: (1) it is completely without merit in law and cannot be supported by a reasonable argument for an extension, modification or reversal of existing law;

(2) it is undertaken primarily to delay or prolong the resolution of the litigation, or to harass or maliciously injure another; or

(3) it asserts material factual statements that are false.

Conduct is frivolous and can be sanctioned under the above court rule if “it is completely without merit . . . and cannot be supported by a reasonable argument for an extension, modification or reversal of existing law.” (Gordon v Marrone, 202 AD2d 104, 110 [2d Dept 1994] lv denied 84 NY2d 813 [1995]). (See RKO Properties v Boymelgreen, 77 AD3d 721 [2d Dept 2010]; Finkelman v SBRE, LLC, 71 AD3d 1081 [2d Dept 2010]; Glenn v Annunziata, 53 AD3d 565 [2d Dept July 15, 2008]; Miller v Dugan, 27 AD3d 429 [2d Dept 2006]; Greene v Doral Conference Center Associates, 18 AD3d 429 [2d Dept 2005]; Ofman v Campos, 12 AD3d 581 [2d Dept 2006]).

In determining if sanctions are appropriate, the Court must look at the broad pattern of conduct by the offending attorneys or parties. (Levy v Carol Management Corporation, 260 AD2d 27 [1d Dept 1999]). The Levy Court, at 33, held that, “22

NYCRR 130-1.1 allows us to exercise our discretion to impose costs and sanctions on an errant party under circumstances particularly applicable here. The relief may include, inter alia, sanctions against the offending party or its attorney (22 NYCRR 130-1.1 [1]) in an amount to be determined by us, which we would make payable to the Lawyers’ Fund for Client Protection (22 NYCRR 130-1.3)” Further, the Levy Court instructed, at 34, that “[s]anctions are retributive, in that they punish past conduct. They also are goal oriented, in that they are useful in deterring future frivolous conduct not only by the particular parties, but also by the Bar at large.” The Court, in Kernisan, M.D. v Taylor (171 AD2d 869 [2d Dept 1991]), noted that the intent of the Part 130 Rules “is to prevent the waste of judicial resources and to deter vexatious litigation and dilatory or malicious litigation tactics (cf. Minister, Elders & Deacons of Refm. Prot. Church of City of New York v 198 Broadway, 76 NY2d 411; see Steiner v Bonhamer, 146 Misc 2d 10) [Emphasis added].”

Clearly, the pattern of conduct in the instant action by plaintiff HSBC is subject to sanctions. [*20]HSBC’s use of robsigners is “completely without merit in law or fact.” In my July 1, 2011 decision and order I documented the conflicted conduct of robosigners Scott Anderson, Margery Rotundo and Christina Carter and signature variations used by Scott Anderson and Christina Carter. Further, the attempt of “corporate” HSBC to intervene on July 15, 2011 without making a motion on notice is “without merit in law” and “a waste of judicial resources.”

While the Court cannot sanction HSBC’s President and CEO Irene Dorner, since she appeared by counsel, her conduct by failing to appear at the July 15, 2011 hearing without any reasonable explanation is without merit. As the leader of HSBC she could have shed some light on what happened in this action. She was missing in action, demonstrating her personal contempt for the Supreme Court of the State of New York. Mr. Cercone, her counsel, stated she was out of the country, but aware of the Court hearing. However, he stated “I have not communicated with Ms. Dorner.” Therefore, how did he know she was aware of the hearing or even out of country?

Moreover, HSBC’s Pontius Pilate/Sergeant Schultz defense is absurd. The case caption states that HSBC is the plaintiff, not OCWEN. If HSBC has its name on the caption, it can’t claim ignorance. HSBC as plaintiff is responsible for the actions of its agents, such as OCWEN. Mr. Ware’s claim that “neither HSBC not Dorner was in any practical position to control the prosecution of this action” is ludicrous. This does not absolve HSBC of its corporate sins. If HSBC is a ship, Ms. Dorner is the Captain and responsible for both the good and the bad. However, in the instant action, HSBC appears to be the RMS Titanic. Ms. Dorner, unlike Captain Edward Smith of the RMS Titanic, did not go down with the ship after it struck an iceberg.

Further, plaintiff HSBC and its counsel, Shapiro DiCaro & Barak, LLC, engaged in frivolous conduct by asserting false material representations, including claims that HSBC: owned the TAHER note; had standing to prosecute the instant action; and, had offices at 1661 Worthington Road, Suite 100, West Palm Beach, FL 33409 [OCWEN’s offices]. Further, in Mr. Cassara’s January 6, 2011 affirmation “under the penalties of perjury” he asserted that an OCWEN employee, robosigner Christiana Carter, was a representative of HSBC and that the best of Mr. Cassara’s knowledge, information, and

belief, the Summons and Complaint, and other papers filed or submitted to the Court in this matter contain no false statements of fact or law.” “Nothing could more aptly be described as conduct completely without merit in fact’ than the giving of sworn testimony or providing an affidavit, knowing the same to be false, on a material issue.” (Sanders v Copley, 194 AD2d 85, 88 [1d Dept 1993]). Conduct of counsel is “frivolous because it was without merit in law and involved the assertion of misleading factual statements.” (Curcio v J.P. Hogan Coring & Sawing Corp., 303 AD2d 357, 358 [2d Dept 2003]).

In Navin v Mosquera (30 AD3d 883 [3d Dept 2006]), the Court instructed that when considering if specific conduct is sanctionable as frivolous, “courts are required to

examine whether or not the conduct was continued when its lack of legal or factual basis was apparent [or] should have been apparent’ (22 NYCRR 130-1.1 [c]).” In Sakow ex rel. Columbia Bagel, Inc. v Columbia Bagel, Inc. (6 Misc 3d 939, 943 [Sup Ct, New York County 2004]), the Court held that “[i]n assessing whether to award sanctions, the Court must consider whether the attorney adhered to the standards of a reasonable attorney (Principe v Assay Partners, 154 Misc [*21]2d 702 [Sup Ct, NY County 1992]).” In the instant action, a reasonable attorney would not have affirmed under penalties of perjury that Christina Cater was a representative of HSBC, but would explain that she was an employee of its servicer, OCWEN. Therefore, the course of conduct of Shapiro, DiCaro & Barak, LLC, and Frank Cassara, Esq., in the instant action, was not reasonable.

In this time of budgetary constraints, when our Courts have an increased caseload but less funding, the Court cannot countenance the continuation of actions which waste scarce judicial resources. Therefore, based upon the totality of frivolous conduct in this matter by plaintiff HSBC and its counsel, Shapiro, DiCaro & Barak, LLC, the Court finds it is appropriate to impose sanctions of $10,000.00 upon plaintiff HSBC and $5,000.00 upon Shapiro, DiCaro & Barak, LLC.

Conclusion

Accordingly, it is

ORDERED that, after conducting a hearing on July 15, 2011, to determine if plaintiff HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, plaintiff’s counsel Frank M. Cassara, Esq. and his firm Shapiro, DiCaro & Barak, LLC engaged in “frivolous conduct,” as defined in the Rules of the Chief Administrator, 22 NYCRR § 130-1 (c) and that plaintiff HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, plaintiff’s counsel Frank M. Cassara, Esq. and his firm Shapiro, DiCaro & Barak, LLC were granted “a reasonable opportunity to be heard,” pursuant to the Rules of the Chief Administrator, 22 NYCRR § 130-1.1 (d), the Court finds that plaintiff HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2 and the law firm of Shapiro, DiCaro & Barak, LLC engaged in “frivolous conduct,” as defined in 22 NYCRR § 130-1.1, in the instant matter; and it is further

ORDERED that plaintiff HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, pursuant to the Rules of the Chief Administrator, 22 NYCRR

§ 130-1.3, shall pay a sanction of $10,000.00, to the Lawyer’s Fund for Client Protection, 119 Washington Avenue, Albany, NY 12210, within thirty (30) days after service of this decision and order; and it is further

ORDERED that the law firm of Shapiro, DiCaro & Barak, LLC, pursuant to the Rules of the Chief Administrator, 22 NYCRR § 130-1.3, shall pay a sanction of $5,000.00, to the Lawyer’s Fund for Client Protection, 119 Washington Avenue, Albany, NY 12210, within thirty (30) days after service of this decision and order; and it is further

ORDERED, that Ronald David Bratt, Esq., my Principal Law Clerk, is directed to serve this order by first-class mail, upon: Irene M. Dorner, President and Chief Executive Officer of plaintiff, HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, 452 Fifth Avenue, New York, New York 10018; and, Shapiro DiCaro & Barak, LLC, 250 Mile Crossing Boulevard, Suite One, Rochester, New York 14624. [*22]

This constitutes the Decision and Order of the Court.

ENTER

___________________________

Hon. Arthur M. SchackJ. S. C

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Posted in STOP FORECLOSURE FRAUDComments (2)

NY Judge Spinner Denies 86 Applications for JUDGMENT OF FORECLOSURE AND SALE Due to No Affirmation by Plaintiff Counsel

NY Judge Spinner Denies 86 Applications for JUDGMENT OF FORECLOSURE AND SALE Due to No Affirmation by Plaintiff Counsel


Excerpt:

Plaintiff has applied to this Court for the granting of a Judgment of Foreclosure & Sale pursuant to RPAPL § 1351. The express provisions of the Administrative Order of the Chief Administrative Judge of the Courts, no. A0548/10 require the filing of an Affirmation by Plaintiff’s counsel. No such Affirmation has been filed in this proceeding, in derogation of the aforesaid mandate. Accordingly, this application must be denied.

It is, therefore,

ORDERED that the within application by the Plaintiff shall be and the same is hereby denied without prejudice.

[ipaper docId=59494902 access_key=key-264kx7256bxnizbtwjpy height=600 width=600 /]

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Posted in STOP FORECLOSURE FRAUDComments (1)

HSBC v TAHER | Judge SCHACK Grand SLAM!! MERS, Plaintiff’s Counsel, Ocwen Robo-Signers Christina Carter, Scott Anderson, Margery Rotundo Dismissed w/ PREJUDICE

HSBC v TAHER | Judge SCHACK Grand SLAM!! MERS, Plaintiff’s Counsel, Ocwen Robo-Signers Christina Carter, Scott Anderson, Margery Rotundo Dismissed w/ PREJUDICE


coup de gras

Decided on July 1, 2011

Supreme Court, Kings County


HSBC Bank USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2

against

Ellen N. Taher, et. al.

EXCERPT:

On plaintiff HSBC’s deadline day, January 7, 2011, the 60th day after issuing my November 8, 2010 decision and order, plaintiff’s counsel, Frank M. Cassara, Esq., of Shapiro, DiCaro & Barak, LLC, submitted to my chambers the required affirmation, pursuant to Chief Administrative Judge Pfau’s Administrative Order 548/10. Mr. Cassara, affirmed “under the penalties of perjury”:

[…]

The assignment of the subject mortgage and note to HSBC, by MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. (MERS), in the instant foreclosure action is without legal authority. MERS never possessed the TAHER note it allegedly assigned to plaintiff HSBC. Thus, plaintiff HSBC lacked standing to commence the instant foreclosure action. Therefore, the assignment is defective and the instant action is dismissed with prejudice.

Mr. Cassara’s affirmation, affirmed “under the penalties of perjury,” that to the best of Mr. Cassara’s “knowledge, information, and belief, the Summons and Complaint, and other papers filed or submitted to the [*4]Court in this matter contain no false statements of fact or law,” is patently false. Moreover, the Court is troubled that: the alleged representative of plaintiff HSBC, Christina Carter, who according to Mr. Cassara, “confirmed the factual accuracy and allegations set forth in the Complaint and any supporting affirmations filed with the Court, as well as the accuracy of the notarizations contained in the supporting documents filed therewith,” is not an employee of HSBC, but a robosigner employed by OCWEN LOAN SERVICING, LLC [OCWEN], whose signature on legal documents has at least three variations; the MERS to plaintiff HSBC assignment of the subject mortgage and note was executed by Scott W. Anderson, a known robosigner and OCWEN employee, whose signature is reported to have appeared in at least four different variations on mortgage assignments; and, the instant affidavit of merit was executed by Margery Rotundo, another robosigner, OCWEN employee and self-alleged employee of various other banking entities.

Last month, on May 19, 2011, in a case involving a defective MERS to HSBC assignment by a robosigner, Maine’s highest court, the Supreme Judicial Court, found that HSBC’s affidavits and the assignment of the note and mortgage by MERS to HSBC contained serious defects. The Maine Court held “that the affidavits submitted by HSBC contain serious irregularities that make them inherently untrustworthy.” (HSBC Mortg. Services, Inc. v Murphy, 19 A3d 815, 2011 ME 59, * 3). HSBC has a history of foreclosure actions before me with affidavits of merit executed by Margery Rotundo and MERS to HSBC assignments executed by Scott Anderson that “contain serious irregularities that make them inherently untrustworthy.” Moreover, Mr. Cassara was put on notice, in my November 8, 2010 decision and order, that “[t]he wrongful filing and prosecution of foreclosure proceedings which are discovered to suffer from these defects may be cause for disciplinary and other sanctions upon participating counsel.”

[…]

Robosigner Scott W. Anderson

While I have never personally met Mr. Anderson, his signatures have appeared in many foreclosure documents in this Court. His claims of wearing different corporate hats and the variations in the scrawls of initials used for his signature on mortgage documents has earned Mr. Anderson notoriety as a robosigner. Kimberly Miller, in her January 5, 2011-Palm Beach Post article, “State details foreclosure crisis,” wrote:

Sweeping evidence of the case the state attorney general’s office

has built in its pursuit of foreclosure justice for Florida homeowners is

outlined in a 98-page presentation complete with copies of allegedly

forged signatures, false notarizations, bogus witnesses and improper

mortgage assignments.

The presentation, titled “Unfair, Deceptive and Unconscionable

Acts in Foreclosure Cases,” was given during an early December

conference of the Florida Association of Court Clerks and Comptrollers

by the attorney general’s economic crimes division.

It is one of the first examples of what the state has compiled in

its exploration of foreclosure malpractice, condemning banks, mortgage

servicers and law firms for contributing to the crisis by cutting corners . . .

In page after page of copied records, the presentation meticulously

documents cases of questionable signatures, notarizations that could not

have occurred when they are said to have because of when the notary

stamp expires, and foreclosures filed by entities that might not have

had legal ability to foreclose.

It also focuses largely on assignments of mortgage [sic],

documents that transfer ownership of mortgages from one bank to

another. Mortgage assignments became an issue after the real estate

boom, when mortgages were sold and resold, packaged into securities

trusts and otherwise transferred in a labyrinthine fashion that made

tracking difficult.

As foreclosures mounted, the banks appointed people to create

assignments, “thousands and thousands and thousands” of which were signed weekly by people who may not [*6]have known what they were signing . . .

In another example, the signature of Scott Anderson, an employee

of West Palm Beach-based Ocwen Financial Corp., appears in four

styles on mortgage assignments . . .

Paul Koches, executive vice president of Ocwen, acknowledged

Tuesday that the signatures were not all Anderson’s, but that doesn’t mean

they were forged, he said. Certain employees were given authorization

to sign for Anderson on mortgage assignments, which Koches noted

do not need to be notarized.

Still, Ocwen has since stopped allowing other people to sign for

Anderson, Koches said.

Last September, the Ohio Court of Appeals, Second District, Montgomery County

(2010 WL 3451130, 2010-Ohio-4158, lv denied 17 Ohio St.3d 1532 [2011]), affirmed the denial of a foreclosure, sought by plaintiff HSBC, because of numerous irregularities. The Ohio Court, in citing four decisions by this Court [three of the four involved Scott Anderson as assignor] summarized some of this Court’s prior concerns with HSBC and Mr. Anderson, in observing, at * 11:

recent decisions in the State of New York have noted numerous

irregularities in HSBC’s mortgage documentation and corporate

relationships with Ocwen, MERS, and Delta. See, e.g., HSBC Bank

USA, N.A. v Cherry (2007), 18 Misc 3d 1102 (A) [Scott Anderson

assignor] and HSBC Bank USA, N.A. v Yeasmin (2010), 27 Misc 3d

1227 (A) (dismissing HSBC’s requests for orders of reference in

mortgage foreclosure actions, due to HSBC’s failure to provide proper

affidavits). See, also, e.g., HSBC Bank USA, N.A. v Charlevagne (2008),

20 Misc 3d 1128 (A) [Scott Anderson assignor] and HSBC Bank USA,

N.A. v Antrobus (2008), 20 Misc 3d 1127 (A) [Scott Anderson assignor]

(describing “possible incestuous relationship” between HSBC Bank,

Ocwen Loan Servicing, Delta Funding Corporation, and Mortgage

Electronic Registration Systems, Inc., due to the fact that the entities

all share the same office space at 1661 Worthington Road, Suite 100,

West Palm Beach, Florida. HSBC also supplied affidavits in support

of foreclosure from individuals who claimed simultaneously to be

officers of more than one of these corporations.).This Court reviewed Scott Anderson’s signature on the instant MERS to HSBC assignment of the TAHER mortgage and note and using ACRIS compared his signature with that used in assignments in the five prior Scott Anderson assignment foreclosure cases decided by this Court. Similar to the Florida Attorney General’s Economic Crimes Division findings, as reported above in the Kimberly Miller Palm Beach Post article, I also found four variations of Mr. Anderson’s signature in these six assignments. Each signature is actually a variation of Mr. Anderson’s initials, “SA.” The Court concludes that it must be a herculean task for Mr. Anderson to sign “Scott Anderson” or “Scott W. Anderson” in full.

Mr. Anderson’s first signature variation is found in: the January 19, 2007 assignment of the 48 Van Siclen Avenue (Block 3932, Lot 45, County of Kings) mortgage and note from DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE TO MTGLQ INVESTORS LP, by Scott W. Anderson as Senor Vice President of OCWEN, attorney-in-fact for DEUTSCHE BANK (Deutsche Bank Nat Trust Co. v Castellanos, 18 Misc 3d 1115 [A] [Sup Ct, Kings County 2007]), recorded on February 7, 2007 at CRFN 2007000073000; and, the June 13, 2007 assignment of the 3570 Canal Avenue (Block 6978, Lot 20, County of Kings) mortgage and note from MERS to HSBC, by Scott Anderson as Vice President of MERS, acting as nominee for DELTA (HSBC Bank USA, N.A. v Cherry, 18 Misc 3d 1102 (A) [Sup Ct, Kings County 2007]), recorded on August 13, 2007 at CRFN 2007000416732. In this signature variation the letter “S” is a cursive bell-shaped curve overlapping with the cursive letter “A.”

The second signature variation used for Mr. Anderson is in the May 1, 2007 assignment of the 572 Riverdale Avenue (Block 3838, Lot 39, County of Kings) mortgage and note from MERS to HSBC, by Scott Anderson as Vice President of MERS, acting as nominee for DELTA (HSBC Bank USA, N.A. v Valentin, 18 Misc 3d 1123 [A] [Sup [*7]Ct, Kings County 2008]) and HSBC Bank USA, N.A. v Valentin, 21 Misc 3d 1124 [A] [Sup Ct, Kings County 2008], affd as modified 72 AD3d 1027 [2010]), recorded on June 13, 2007 at CRFN 2007000306260. These decisions will be referred to as Valentin I and Valentin II. In this signature variation the letter “S” is a cursive circle around a cursive letter “A” with various loops.

The third signature variation used for Mr. Anderson is in the November 30, 2007 assignment of the 680 Decauter Street (Block 1506, Lot 2, County of Kings) mortgage and note from MERS to HSBC, by Scott Anderson as Vice President of MERS, acting as nominee for DELTA (HSBC Bank USA, N.A. v Antrobus, 20 Misc 3d 1127 [A] [Sup Ct, Kings County [2008]), recorded on January 16, 2008 at CRFN 2008000021186. In this signature variation, the initials are illegible. One cursive letter looks almost like the letter “O.” It is a circle sitting in a valley created by something that looks like the cursive letter “M.”

In the fourth signature variation, used for Mr. Anderson in the February 16, 2009 assignment in the instant case, the cursive letter “S,” which is circular with a loop on the lower left side abuts the cursive letter “A” to its right.

Moreover, in HSBC Bank USA, N.A. v Cherry, Mr. Anderson acted both as assignor of the mortgage and note to HSBC and then as servicing agent for assignee HSBC by executing the “affidavit of merit”for a default judgment. Because of this, in Valentin I, I required him to provide me with an affidavit about his employment history. In Valentin II the Court was provided with an affidavit by Mr. Anderson, sworn on March 14, 2008. Mr. Anderson, in his affidavit, admitted he was conflicted. I noted, at * 2, in Valentin II that:

The Court is troubled that Mr. Anderson acted as both assignor

of the instant mortgage loan, and then as the Vice President of Ocwen,

assignee HSBC’s servicing agent. He admits to this conflict, in ¶ 13,

stating that “[w]hen the loan went into default and then foreclosure in

2007, Ocwen, in it capacity as servicer, elected to remove the loan

from the MERS system and transfer title to HSBC.”

The stockholders of HSBC and the noteholders of the Trust [the

owner of the mortgage] probably are not aware that Mr. Anderson,

on behalf of the servicer, Ocwen, claims to have the right to assign

“toxic” nonperforming mortgage loans to them. It could well be that

Ocwen’s transfer of the instant nonperforming loan, as well as others, is

part of what former Federal Reserve Board Chairman Alan Greenspan

referred to in his October 23, 2008 testimony, before the House

Oversight Committee, as “a once in a century credit tsunami.”

Interestingly, the purported signature of Mr. Anderson in the March 14, 2008-Valentin II affidavit is a fifth signature variation. The Court is perplexed that in response to my order for Mr. Anderson to submit an affidavit with respect to his employment, Mr. Anderson was unable to sign either “Scott Anderson” or “Scott W. Anderson.” Instead, there is a fifth variation of scrawled initials. There is a big loop for the cursive letter “S,” which contains within it something that looks like the cursive letter “M” going into lines that look like the cursive letter “V,” with a wiggly line going to the right of the page.

Robosigner Margery Rotundo

In the instant action, Margery Rotundo executed the April 27, 2009 affidavit of merit and amount due. Ms. Rotundo has, in prior foreclosure cases before me, a history of alleging to be the Senior Vice President of various entities, including plaintiff HSBC, Nomura Credit & Capital, Inc. and an unnamed servicing agent for HSBC. In the instant action she claims to be the Senior Vice President of Residential Loss Mitigation of OCWEN, HSBC’s servicing agent.

In HSBC Bank USA, N.A. v Charlevagne (20 Misc 3d 1128 (A) [Sup Ct, Kings County 2008]), one of the cases in which Scott Anderson as Vice President of MERS assigned the mortgage and note to HSBC, I commented about Ms. Rotundo’s self-allegations of multiple employers, at * 1:

The renewed application of plaintiff, HSBC . . . for an order of

reference and related relief in this foreclosure action, in which all

defendants defaulted, for the premises located at 455 Crescent Street,

Brooklyn, New York (Block 4216, Lot 20, County of Kings) is again [*8]

denied without prejudice, with leave to renew upon providing the

Court with a satisfactory explanation to four concerns.

First, the original application for an order of reference and

related relief was denied with leave to renew, in my unpublished

decision and order of November 15, 2007, because the “affidavit of

merit” was not made by a party but by Margery Rotundo, who swore

that [she] was “Senior Vice President Residential Loss Mitigation of

OCWEN LOAN SERVICING, LLC [OCWEN], Attorney in Fact for

HSBC,”and the “Limited Power of Attorney” from HSBC to OCWEN

was defective. In the renewed application, Ms. Rotundo claims in her

January 9, 2008-“affidavit of merit and amount due,” that she “is the

Senior Vice President of Residential Loss Mitigation of 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.” In prior decisions, I found that

Ms. Rotundo swore: on October 5, 2007 to be Senior Vice President

of Loss Mitigation for Nomura Credit & Capital, Inc. (Nomura Credit

& Capital, Inc., 19 Misc 3d 1126 (A) [April 30, 2008]); and, on

December 12, 2007 to be Senior Vice President of an unnamed

servicing agent for HSBC (HSBC Bank USA, NA v Antrobus, 20

Misc 3d 1127 (A) [July 31, 2008]).

The late gossip columnist Hedda Hopper and the late United

States Representative Bella Abzug were famous for wearing many

colorful hats. With all the corporate hats Ms. Rotundo has recently

worn, she might become the contemporary millinery rival to both

Ms. Hopper and Ms. Abzug. The Court needs to know the employment

history of the peripatetic Ms. Rotundo. Did she truly switch employers

or did plaintiff have her sign the “affidavit of merit and amount due”

as its Senior Vice President solely to satisfy the Court?

In my Charlevagne decision and order I denied an order of reference without prejudice and granted leave to plaintiff HSBC to renew its application for an order of reference for the premises by providing the Court with several documents, including, at * 4, “an affidavit from Margery Rotundo describing her employment history for the past three years.” Subsequently, plaintiff HSBC’s counsel in Charlevagne, Steven J. Baum, P.C., never provided me with an affidavit from Margery Rotundo, but filed with the Kings County Clerk, on October 27, 2008, a stipulation of discontinuance and cancellation of the notice of pendency.

Robosigner Christina Carter

Mr. Cassara, plaintiff’s counsel affirmed that “On January 4, 2011 and January 5, 2011, I communicated with the following representative . . . of Plaintiff . . . Christina Carter . . . Manager of Account Management.” This is disingenuous. Ms. Carter is not employed by plaintiff, but by OCWEN. She executed documents as an officer of MERS and as an employee of OCWEN. Ms. Carter’s signature on documents is suspect because of the variations of her signature used.

This Court examined eight recent documents that exhibit three different variations of Christina Carter’s signature. The first signature variation is on her May 24, 2010 application with the Florida Department of State for a notary public commission. In this application she lists as her business address that of OCWEN, “1661 Worthington Road, West Palm Beach, FL 33409.” In her full signature the capital letters “C” in her first and last names are signed differently than in other recent documents reviewed by this Court.

In five other documents reviewed by the Court, Ms. Carter signs her initials with the second letter “C” looking like a cursive letter “L,” with a circular loop on the second letter “C.” Three of these documents are deeds of release to acknowledge mortgage satisfactions, filed with the Clerk of Court for Middlesex County, South District, State of Massachusetts. In the first document, signed on July 2, 2010, Ms. Carter signed as “Account Management, Manager” for OCWEN, for the premises at 158 Algonquin Trail, Ashland, Massachusetts, with the deed of release [*9]recorded on September 9, 2010, at document number 2010 00156681. In the second document, signed on July 7, 2010, Ms. Carter signed as “Account Management, Manager” for US BANK NATIONAL ASSOCIATION, AS TRUSTEE BY ITS ATTORNEY-IN-FACT OCWEN LOAN SERVICING, LLC, for the premises at 30 Kenilworth Street, Malden, Massachusetts, with the deed of release recorded on September 3, 2010, at document number 2010 01542078. In the third Middlesex County, Massachusetts document, signed on July 19, 2010, she signed as “Account Management, Manager” for OCWEN, for the premises at 10 Johnson Farm Road, Lexington, Massachusetts, with the deed of release recorded on September 9, 2010, at document number 2010 00156684. In the fourth document, signed on July 12, 2010, for the assignment of a mortgage for 1201 Pine Sage Circle, West Palm Beach, Florida, Ms. Carter signed as “Account Management, Manager” for NEW CENTURY MORTGAGE CORPORATION BY ITS ATTORNEY-IN-FACT OCWEN LOAN SERVICING, LLC (NEW CENTURY). This mortgage was assigned to DEUTSCHE BANK NATIONAL TRUST COMPANY, AS TRUSTEE FOR IXIS REAL ESTATE CAPITAL TRUST 2005-HE3 MORTGAGE PASS THROUGH CERTIFICATES, SERIES 2005-HE3 (DEUTSCHE BANK) and recorded on August 23, 2010 with the Palm Beach County Clerk at CFN 20100314054. Interestingly, both assignor NEW CENTURY and assignee DEUTSCHE BANK have the same address, c/o OCWEN, “1661 Worthington Road, Suite 100, West Palm Beach, FL 33409.” In the fifth document, Ms. Carter changes corporate hats. She signed, on September 8, 2010, an Oregon assignment of a mortgage deed of trust, for 20673 Honeysuckle Lane, Bend Oregon, as Vice President of MERS “ACTING SOLELY AS NOMINEE FOR CHAPEL MORTGAGE CORPORATION.” The assignment is to DEUTSCHE BANK NATIONAL TRUST COMPANY, AS TRUSTEE FOR IXIS REAL ESTATE CAPITAL TRUST 2006-HE2 MORTGAGE PASS THROUGH CERTIFICATES, SERIES 2006-HE2, whose address is c/o OCWEN, “1661 Worthington Road, Suite 100, West Palm Beach, FL 33409.” This was recorded on September 20, 2010 with the Clerk of Deschutes County, Oregon.

Ms. Carter, in the third variation of her signature, again only uses her initials, but the second letter “C” looks like the cursive letter “C,” not the cursive letter “L” with a circular loop. The Court examined two of these documents. The first document is a mortgage satisfaction, signed on June 15, 2010, and filed with the Clerk of Court for Middlesex County, South District, State of Massachusetts. Ms. Carter signed as “Account Management, Manager” for OCWEN, for the premises at 4 Mellon Road, Billerica, Massachusetts. The deed of release was recorded on July 19, 2010, at document number 2010 00031211. In the second document, a mortgage satisfaction for the premises at 13352 Bedford Meadows Court, Wellington, Florida, Ms. Carter signed on July 22, 2010, as “Account Management, Manager” for “HSBC BANK USA, NATIONAL ASSOCIATION AS TRUSTEE BY ITS ATTORNEY-IN FACT OCWEN LOAN SERVICING, LLC.” The document never states for whom HSBC is the Trustee.

This was recorded on September 10, 2010 with the Palm Beach County Clerk at CFN 20100339935.

Plaintiff’s lack of Standing

Real Property Actions and Proceedings Law (RPAPL) § 1321 allows the Court in a foreclosure action, upon the default of defendant or defendant’s admission of mortgage payment arrears, to appoint a referee “to compute the amount due to the plaintiff.” Plaintiff HSBC’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 AD2d 770 [2d Dept 1996]).

However, the instant action must be dismissed because plaintiff HSBC lacks standing to bring this action. MERS lacked the authority to assign the subject TAHER mortgage to HSBC and there is no evidence that MERS physically possessed the TAHER notes. Under the terms of the TAHER consolidation, extension and modification agreement, DELTA, not MERS, is the “Note Holder.” As described above, the consolidation, extension and modification agreement defines the “Note Holder” as the “Lender or anyone who succeeds to Lender’s rights under this Agreement and who is entitled to receive the payments.”

“Standing to sue is critical to the proper functioning of the judicial system. It is a threshold issue. If standing is denied, the pathway to the courthouse is blocked. The plaintiff who has standing, however, may cross the threshold and seek judicial redress.” (Saratoga County Chamber of Commerce, Inc. v Pataki, 100 NY2d 801 812 [2003], cert denied 540 US 1017 [2003]). Professor David Siegel (NY Prac, § 136, at 232 [4d ed]), instructs that:

[i]t is the law’s policy to allow only an aggrieved person to bring a

lawsuit . . . A want of “standing to sue,” in other words, is just another

way of saying that this particular plaintiff is not involved in a genuine

controversy, and a simple syllogism takes us from there to a “jurisdictional” [*10]

dismissal: (1) the courts have jurisdiction only over controversies; (2) a

plaintiff found to lack “standing”is not involved in a controversy; and

(3) the courts therefore have no jurisdiction of the case when such a

plaintiff purports to bring it.

“Standing to sue requires an interest in the claim at issue in the lawsuit that the law will recognize as a sufficient predicate for determining the issue at the litigant’s request.” (Caprer v Nussbaum (36 AD3d 176, 181 [2d Dept 2006]). If a plaintiff lacks standing to sue, the plaintiff may not proceed in the action. (Stark v Goldberg, 297 AD2d 203 [1st Dept 2002]).

The Appellate Division, Second Department recently instructed, with respect to standing in a foreclosure action, in Aurora Loan Services, LLC v Weisblum (___ AD3d ___, 2011 NY Slip Op 04184 [May 17, 2011]), at * 6-7, that:

In order to commence a foreclosure action, the plaintiff must

have a legal or equitable interest in the mortgage ( see Wells Fargo

Bank, N.A. v Marchione, 69 AD3d, 204, 207 [2d Dept 2009]). A

plaintiff has standing where it is both (1) the holder or assignee of

the subject mortgage and (2) the holder or assignee of the underlying

note, either by physical delivery or execution of a written assignment

prior to the commencement of the action with the filing of the complaint

(see Wells Fargo Bank, N.A. v Marchione, 69 AD3d at 207-209; U.S.

Bank v Collymore, 68 AD3d 752, 754 [2d Dept 2009].)

Assignments of mortgages and notes are made by either written instrument or the

assignor physically delivering the mortgage and note to the assignee. “Our courts have repeatedly held that a bond and mortgage may be transferred by delivery without a written instrument of assignment.” (Flyer v Sullivan, 284 AD 697, 699 [1d Dept 1954]).

In the instant action, even if MERS had authority to transfer the mortgage to HSBC, DELTA, not MERS, is the note holder. Therefore, MERS cannot transfer something it never proved it possessed. A “foreclosure of a mortgage may not be brought by one who has no title to it and absent transfer of the debt, the assignment of the mortgage is a nullity [Emphasis added].” (Kluge v Fugazy (145 AD2d 537, 538 [2d Dept 1988]). Moreover, “a mortgage is but an incident to the debt which it is intended to secure . . . the logical conclusion is that a transfer of the mortgage without the debt is a nullity, and no interest is assigned by it. The security cannot be separated from the debt, and exist independently of it. This is the necessary legal conclusion.” (Merritt v Bartholick, 36 NY 44, 45 [1867]. The Appellate Division, First Department, citing Kluge v Fugazy in Katz v East-Ville Realty Co. ( 249 AD2d 243 [1d Dept 1998]), instructed that “[p]laintiff’s attempt to foreclose upon a mortgage in which he had no legal or equitable interest was without foundation in law or fact.” (See U.S. Bank, N.A. v Collymore, 68 AD3d at 754).


MERS had no authority to assign the subject mortgage and note

Scott Anderson for MERS as assignor, did not have specific authority to sign the TAHER mortgage. Under the terms of the consolidation, extension and modification agreement, MERS is “acting solely as nominee for Lender [DELTA].” The alleged power of attorney cited in the Scott Anderson MERS to HSBC assignment, as described [*11]above, is a limited power of attorney from DELTA to OCWEN for the premises located at 14 Harden Street, Brooklyn, New York, not the subject premises. MERS is not mentioned or involved with this limited power of attorney. In both underlying TAHER mortgages MERS was “acting solely as a nominee for Lender,” which is DELTA. The term “nominee” is defined as “[a] person designated to act in place of another, usu. in a very limited way” or “[a] party who holds bare legal title for the benefit of others.” (Black’s Law Dictionary 1076 [8th ed 2004]). “This definition suggests that a nominee possesses few or no legally enforceable rights beyond those of a principal whom the nominee serves.” (Landmark National Bank v Kesler, 289 Kan 528, 538 [2009]). The Supreme Court of Kansas, in Landmark National Bank, 289 Kan at 539, observed that:

The legal status of a nominee, then, depends on the context of

the relationship of the nominee to its principal. Various courts have

interpreted the relationship of MERS and the lender as an agency

relationship. See In re Sheridan, 2009 WL631355, at *4 (Bankr. D.

Idaho, March 12, 2009) (MERS “acts not on its own account. Its

capacity is representative.”); Mortgage Elec. Registrations Systems,

Inc. v Southwest, 2009 Ark. 152 ___, ___SW3d___, 2009 WL 723182

(March 19, 2009) (“MERS, by the terms of the deed of trust, and its

own stated purposes, was the lender’s agent”); La Salle Nat. Bank v

Lamy, 12 Misc 3d 1191 [A], at *2 [Sup Ct, Suffolk County 2006]) . . .

(“A nominee of the owner of a note and mortgage may not effectively

assign the note and mortgage to another for want of an ownership

interest in said note and mortgage by the nominee.”)

The New York Court of Appeals in MERSCORP, Inc. v Romaine (8 NY3d 90 [2006]), explained how MERS acts as the agent of mortgagees, holding at 96:

In 1993, the MERS system was created by several large

participants in the real estate mortgage industry to track ownership

interests in residential mortgages. Mortgage lenders and other entities,

known as MERS members, subscribe to the MERS system and pay

annual fees for the electronic processing and tracking of ownership

and transfers of mortgages. Members contractually agree to appoint

MERS to act as their common agent on all mortgages they register

in the MERS system. [Emphasis added]

Thus, it is clear that MERS’s relationship with its member lenders is that of agent with the lender-principal. This is a fiduciary relationship, resulting from the manifestation of consent by one person to another, allowing the other to act on his behalf, subject to his control and consent. The principal is the one for whom action is to be taken, and the agent is the one who acts.It has been held that the agent, who has a fiduciary relationship with the principal, “is a party who acts on behalf of the principal with the latter’s express, implied, or apparent authority.” (Maurillo v Park Slope U-Haul, 194 AD2d 142, 146 [2d [*12]Dept 1992]). “Agents are bound at all times to exercise the utmost good faith toward their principals. They must act in accordance with the highest and truest principles of morality.” (Elco Shoe Mfrs. v Sisk, 260 NY 100, 103 [1932]). (See Sokoloff v Harriman Estates Development Corp., 96 NY 409 [2001]); Wechsler v Bowman, 285 NY 284 [1941]; Lamdin v Broadway Surface Advertising Corp., 272 NY 133 [1936]). An agent “is prohibited from acting in any manner inconsistent with his agency or trust and is at all times bound to exercise the utmost good faith and loyalty in the performance of his duties.” (Lamdin, at 136).

Thus, in the instant action, MERS, as nominee for DELTA, is DELTA’s agent for limited purposes. It only has those powers given to it and authorized by DELTA, its principal. Plaintiff HSBC failed to submit documents authorizing MERS, as nominee for DELTA, to assign the subject consolidation extension and modification mortgage to plaintiff HSBC. Therefore, MERS lacked authority to assign the TAHER mortgage, making the assignment defective. In Bank of New York v Alderazi (28 Misc 3d 376, 379-380 [Sup Ct, Kings County 2010]), Justice Wayne Saitta instructed that:

A party who claims to be the agent of another bears the burden

of proving the agency relationship by a preponderance of the evidence

(Lippincott v East River Mill & Lumber Co., 79 Misc 559 [1913])

and “[t]he declarations of an alleged agent may not be shown for

the purpose of proving the fact of agency.” (Lexow & Jenkins, P.C. v

Hertz Commercial Leasing Corp., 122 AD2d 25 [2d Dept 1986]; see

also Siegel v Kentucky Fried Chicken of Long Is. 108 AD2d 218 [2d

Dept 1985]; Moore v Leaseway Transp/ Corp., 65 AD2d 697 [1st Dept

1978].) “[T]he acts of a person assuming to be the representative of

another are not competent to prove the agency in the absence of evidence

tending to show the principal’s knowledge of such acts or assent to them.”

(Lexow & Jenkins, P.C. v Hertz Commercial Leasing Corp., 122 AD2d

at 26, quoting 2 NY Jur 2d, Agency and Independent Contractors § 26).

Further, several weeks ago, the Appellate Division, Second Department in Bank

of New York v Silverberg, (___ AD3d ___, 2011 NY Slip Op 05002 [June 7, 2011]), confronted the issue of “whether a party has standing to commence a foreclosure action when that party’s assignor—in this case, Mortgage Electronic Registration Systems, Inc. (hereinafter MERS)—was listed in the underlying mortgage instruments as a nominee and mortgagee for the purpose of recording, but was never the actual holder or assignee of the underlying notes.” The Court held, “[w]e answer this question in the negative.” Silverberg, similar to the instant TAHER matter, deals with the foreclosure of a mortgage with a consolidation, modification and extension agreement. MERS, in the Silverberg case and the instant TAHER action, never had title or possession of the Note and the definition of “Note Holder” is substantially the same in both consolidation, extension and [*13]modification agreements. The Silverberg Court instructed, at * 4-5:

the assignment of the notes was thus beyond MERS’s authority as

nominee or agent of the lender (see Aurora Loan Servs., LLC v

Weisblum, AD3d, 2011 NY Slip Op 04184, *6-7 [2d Dept 2011];

HSBC Bank USA v Squitteri, 29 Misc 3d 1225 [A] [Sup Ct, Kings

County, F. Rivera, J.]; ; LNV Corp. v Madison Real Estate, LLC,

2010 NY Slip Op 33376 [U] [Sup Ct, New York County 2010,

York, J.]; LPP Mtge. Ltd. v Sabine Props., LLC, 2010 NY Slip Op

32367 [U] [Sup Ct, New York County 2010, Madden, J.]; Bank of

NY v Mulligan, 28 Misc 3d 1226 [A] [Sup Ct, Kings County 2010,

Schack, J.]; One West Bank, F.S.B., v Drayton, 29 Misc 3d 1021

[Sup Ct, Kings County 2010, Schack, J.]; Bank of NY v Alderazi,

28 Misc 3d 376, 379-380 [Sup Ct, Kings County 2010, Saitta, J.]

[the “party who claims to be the agent of another bears the burden

of proving the agency relationship by a preponderance of the evidence”];

HSBC Bank USA v Yeasmin, 24 Misc 3d 1239 [A] [Sup Ct, Kings

County 2010, Schack, J.]; HSBC Bank USA, N.A. v Vasquez, 24

Misc 3d 1239 [A], [Sup Ct, Kings County 2009, Schack, J.]; Bank of

NY v Trezza, 14 Misc 3d 1201 [A] [Sup Ct, Suffolk County 2006,

Mayer, J.]; La Salle Bank Natl. Assn. v Lamy, 12 Misc 3d 1191 [A]

[Sup Ct, Suffolk County, 2006, Burke, J.]; Matter of Agard, 444 BR

231 [Bankruptcy Court, ED NY 2011, Grossman, J.]; but see U.S.

Bank N.A. v Flynn, 27 Misc 3d 802 [Sup Ct, Suffolk County 2011,

Whelan, J.]).

Moreover, the Silverberg Court concluded, at * 5, that “because MERS was never the lawful holder or assignee of the notes described and identified in the consolidation agreement, the . . . assignment of mortgage is a nullity, and MERS was without authority to assign the power to foreclose to the plaintiff. Consequently, the plaintiff failed to show that it had standing to foreclose.” Further, Silverberg the Court observed, at * 6, “the law must not yield to expediency and the convenience of lending institutions. Proper procedures must be followed to ensure the reliability of the chain of ownership, to secure the dependable transfer of property, and to assure the enforcement of the rules that govern real property.” [Emphasis added]

Therefore, the instant action is dismissed with prejudice.


Cancellation of subject notice of pendency

The dismissal with prejudice of the instant foreclosure action requires the

cancellation of the notice of pendency. CPLR § 6501 provides that the filing of a notice of pendency against a property is to give constructive notice to any purchaser of real property or encumbrancer against real property of an action that “would affect the title to, or the possession, use or enjoyment of real property, except in a summary proceeding [*14]brought to recover the possession of real property.” The Court of Appeals, in 5308 Realty Corp. v O & Y Equity Corp. (64 NY2d 313, 319 [1984]), commented that “[t]he purpose of the doctrine was to assure that a court retained its ability to effect justice by preserving its power over the property, regardless of whether a purchaser had any notice of the pending suit,” and, at 320, that “the statutory scheme permits a party to effectively retard the alienability of real property without any prior judicial review.”

CPLR § 6514 (a) provides for the mandatory cancellation of a notice of pendency by:

The Court, upon motion of any person aggrieved and upon such

notice as it may require, shall direct any county clerk to cancel

a notice of pendency, if service of a summons has not been completed

within the time limited by section 6512; or if the action has been

settled, discontinued or abated; or if the time to appeal from a final

judgment against the plaintiff has expired; or if enforcement of a

final judgment against the plaintiff has not been stayed pursuant

to section 551. [emphasis added]

The plain meaning of the word “abated,” as used in CPLR § 6514 (a) is the ending of an action. “Abatement” is defined as “the act of eliminating or nullifying.” (Black’s Law Dictionary 3 [7th ed 1999]). “An action which has been abated is dead, and any further enforcement of the cause of action requires the bringing of a new action, provided that a cause of action remains (2A Carmody-Wait 2d § 11.1).” (Nastasi v Natassi, 26 AD3d 32, 40 [2d Dept 2005]). Further, Nastasi at 36, held that the “[c]ancellation of a notice of pendency can be granted in the exercise of the inherent power of the court where its filing fails to comply with CPLR § 6501 (see 5303 Realty Corp. v O & Y Equity Corp., supra at 320-321; Rose v Montt Assets, 250 AD2d 451, 451-452 [1d Dept 1998]; Siegel, NY Prac § 336 [4th ed]).” Thus, the dismissal of the instant complaint must result in the mandatory cancellation of plaintiff HSBC’s notice of pendency against the property “in the exercise of the inherent power of the court.”


Possible frivolous conduct by HSBC and its counsel

In this Court’s November 8, 2010 decision and order, Mr. Cassara and his firm, as counsel for plaintiff HSBC, were put on notice about the new affirmation required to be submitted by plaintiff’s counsel in foreclosure actions, pursuant to Administrative Order 548/10. In foreclosure cases pending on October 20, 2010, such as the TAHER case, the affirmation is required to be filed with the Court when moving for either an order of reference or a judgment of foreclosure and sale or five business days before a scheduled auction. Chief Judge Lippman, according to the Office of Court Administrations’s October 20, 2010 press release, stated that, “[t]his new filing requirement will play a vital role in ensuring that the documents judges rely on will be thoroughly examined, accurate, and error-free before any judge is asked to take the drastic step of foreclosure.”

Plaintiff’s counsel was warned that defects in foreclosure filings “include failure of plaintiffs and their counsel to review documents and files to establish standing and other [*15]foreclosure requisites; filing of notarized affidavits which falsely attest to such review and to other critical facts in the foreclosure process; and robosigning’ of documents by parties and counsel.” Mr. Cassara affirmed “under the penalties of perjury,” on January 6, 2011, to the factual accuracy of the complaint, the supporting documents and notarizations contained therein and that the complaint and papers filed with the Court in the TAHER matter “contain no false statements of fact or law.” Further, plaintiff’s counsel was informed that “[t]he wrongful filing and prosecution of foreclosure proceedings which are discovered to suffer from these defects may be cause

for disciplinary and other sanctions upon participating counsel [Emphasis added].”

However, plaintiff HSBC did not have standing to bring the instant action and its

complaint is replete with false statements. For example, ¶ 1 alleges that HSBC has an office at “1661 Worthington Road, Suite 100, P.O. Box 24737, West Palm Beach, FL 33415.” This is actually OCWEN’s office. OCWEN’s zip code is 33409, not 33415. Also, how big is P.O. Box 24737? Is it big enough to contain an HSBC office? Further, ¶ 6 alleges that HSBC is the owner of the note, which it is not. MERS had no authority to assign the note owned by DELTA to HSBC. MERS was DELTA’s nominee for recording the TAHER-consolidated mortgage but it never possessed the underlying note. (See Bank of New York v Silverberg at * 4-5).

Three robosigners – Scott Anderson, Margery Rotundo and Christina Carter – are involved in this matter. Scott Anderson, who wears many corporate hats and has at least five variations of his initials scrawled on documents filed in this Court, is the alleged assignor of the subject mortgage and note to HSBC, despite lacking authority from DELTA. Both alleged assignor MERS and alleged assignee HSBC have the same address – 1661 Worthington Road, Suite 100, West Palm Beach, Florida 33409. The milliner’s delight Margery Rotundo executed the affidavit of merit for OCWEN. Then, Mr. Cassara relied upon Christina Carter as the representative of HSBC to confirm the accuracy of HSBC’s documents and their notarizations. However, she is not employed by HSBC. Is Mr. Cassara aware of the robosigning history of Mr. Anderson, Ms. Rotundo and Ms. Carter?

Putting aside HSBC’s lack of standing, MERS allegedly assigned the TAHER- consolidated mortgage and note to HSBC 169 days after defendant TAHER allegedly defaulted in her payments. If HSBC has a duty to make money for its stockholders, why is it purchasing nonperforming loans, and then wasting the Court’s time with defective paperwork and the use of robosigners? The Courts have limited resources, even more so in light of the recent cuts in the budget for fiscal year 2012 and the layoff of several hundred court employees by the Office of Court Administration. The Courts cannot allow itself, as Chief Judge Lippman said in OCA’s October 20, 2010 press release, “to stand by idly and be party to what we know is a deeply flawed process, especially when that process involves basic human needs – such as a family home – during this period of economic crisis.” [*16]

Last year, in HSBC Bank USA v Yeasmin, 24 Misc 3d 1239 [A], for a variety of reasons, I denied plaintiff’s renewed motion for an order of reference and dismissed the foreclosure action with prejudice. Plaintiff’s counsel in YeasminYeasmin, at * 8, that Mr. Westmoreland stated: submitted an affidavit by Thomas Westmoreland, Vice President of Loan Documentation for HSBC, in which he admitted to a lack of due diligence by HSBC. I observed in

in his affidavit, in ¶’s 4 – 7 and part of ¶ 10:

4. The secondary mortgage market is, essentially, the buying and

selling of “pools” of mortgages.

5. A mortgage pools is the packaging of numerous mortgage

loans together so that an investor may purchase a significant

number of loans in one transaction.

6. An investigation of each and every loan included in a particular

mortgage pool, however, is not conducted, nor is it feasible.

7. Rather, the fact that a particular mortgage pool may

include loans that are already in default is an ordinary risk

of participating in the secondary market . . .

10. . . . Indeed, the performance of the mortgage pool is the

measure of success, not any one individual loan contained

therein. [Emphasis added]

The Court can only wonder if . . . the dissemination of this

decision will result in Mr. Westmoreland’s affidavit used as evidence

in future stockholder derivative actions against plaintiff HSBC. It can’t

be comforting to investors to know that an officer of a financial

behemoth such as plaintiff HSBC admits that “[a]n investigation of

each and every loan included in a particular mortgage pool, however,

is not conducted, nor is it feasible” and that “the fact that a particular

mortgage pool may include loans that are already in default is an

ordinary risk of participating in the secondary market.

Therefore, the continuation of this action by plaintiff HSBC, with its false

statements of facts, the use of robosigners, and the disingenuous affirmation of Mr. Cassara, appears to be frivolous. 22 NYCRR § 130-1.1 (a) states that “the Court, in its discretion may impose financial sanctions upon any party or attorney in a civil action or proceeding who engages in frivolous conduct as defined in this Part, which shall be payable as provided in section 130-1.3 of this Subpart.” Further, it states in 22 NYCRR § 130-1.1 (b), that “sanctions may be imposed upon any attorney appearing in the action or upon a partnership, firm or corporation with which the attorney is associated.”

22 NYCRR § 130-1.1(c) states that:

For purposes of this part, conduct is frivolous if: [*17]

(1) it is completely without merit in law and cannot be supported

by a reasonable argument for an extension, modification or

reversal of existing law;

(2) it is undertaken primarily to delay or prolong the resolution of

the litigation, or to harass or maliciously injure another; or

(3) it asserts material factual statements that are false.

It is clear that the instant motion for an order of reference “is completely without merit in law” and “asserts material factual statements that are false.” Further, Mr. Cassara’s January 6, 2011 affirmation, with its false and defective statements may be a cause for sanctions.

Several years before the drafting and implementation of the Part 130 Rules for

costs and sanctions, the Court of Appeals (A.G. Ship Maintenance Corp. v Lezak, 69 NY2d 1, 6 [1986]) observed that “frivolous litigation is so serious a problem affecting the

proper administration of justice, the courts may proscribe such conduct and impose sanctions in this exercise of their rule-making powers, in the absence of legislation to the contrary (see NY Const, art VI, § 30, Judiciary Law § 211 [1] [b] ).”

Part 130 Rules were subsequently created, effective January 1, 1989, to give the

courts an additional remedy to deal with frivolous conduct. These stand beside Appellate Division disciplinary case law against attorneys for abuse of process or malicious prosecution. The Court, in Gordon v Marrone (202 AD2d 104, 110 [2d Dept 1994], lv denied 84 NY2d 813 [1995]), instructed that:

Conduct is frivolous and can be sanctioned under the court rule if

“it is completely without merit . . . and cannot be supported by a

reasonable argument for an extension, modification or reversal of

existing law; or . . . it is undertaken primarily to delay or prolong

the resolution of the litigation, or to harass or maliciously injure

another” (22 NYCRR 130-1.1[c] [1], [2] . . . ).

In Levy v Carol Management Corporation (260 AD2d 27, 33 [1st Dept 1999]) the Court stated that in determining if sanctions are appropriate the Court must look at the broad pattern of conduct by the offending attorneys or parties. Further, “22 NYCRR

130-1.1 allows us to exercise our discretion to impose costs and sanctions on an errant party . . .” Levy at 34, held that “[s]anctions are retributive, in that they punish past conduct. They also are goal oriented, in that they are useful in deterring future frivolous conduct not only by the particular parties, but also by the Bar at large.”

The Court, in Kernisan, M.D. v Taylor (171 AD2d 869 [2d Dept 1991]), noted that the intent of the Part 130 Rules “is to prevent the waste of judicial resources and to deter vexatious litigation and dilatory or malicious litigation tactics (cf. Minister, Elders & Deacons of Refm. Prot. Church of City of New York v 198 Broadway, 76 NY2d 411; see Steiner v Bonhamer, 146 Misc 2d 10) [Emphasis added].” The instant action, with HSBC lacking standing and using robosigners, is “a waste of judicial resources.” This [*18]conduct, as noted in Levy, must be deterred. In Weinstock v Weinstock (253 AD2d 873 [2d Dept 1998]) the Court ordered the maximum sanction of $10,000.00 for an attorney who pursued an appeal “completely without merit,” and holding, at 874, that “[w]e therefore award the maximum authorized amount as a sanction for this conduct (see, 22 NYCRR 130-1.1) calling to mind that frivolous litigation causes a substantial waste of judicial resources to the detriment of those litigants who come to the Court with real grievances [Emphasis added].” Citing Weinstock, the Appellate Division, Second Department, in Bernadette Panzella, P.C. v De Santis (36 AD3d 734 [2d Dept 2007]) affirmed a Supreme Court, Richmond County $2,500.00 sanction, at 736, as “appropriate in view of the plaintiff’s waste of judicial resources [Emphasis added].”

In Navin v Mosquera (30 AD3d 883 [3d Dept 2006]) the Court instructed that when considering if specific conduct is sanctionable as frivolous, “courts are required to

examine whether or not the conduct was continued when its lack of legal or factual basis was apparent [or] should have been apparent’ (22 NYCRR 130-1.1 [c]).” The Court, in Sakow ex rel. Columbia Bagel, Inc. v Columbia Bagel, Inc. (6 Misc 3d 939, 943 [Sup Ct,

New York County 2004]), held that “[i]n assessing whether to award sanctions, the Court must consider whether the attorney adhered to the standards of a reasonable attorney (Principe v Assay Partners, 154 Misc 2d 702 [Sup Ct, NY County 1992]).”

In the instant action, plaintiff HSBC’s President and Chief Executive Officer (CEO) bears a measure of responsibility for plaintiff’s actions, as well as plaintiff’s counsel. In Sakow at 943, the Court observed that “[a]n attorney cannot safely delegate all duties to others.” Irene M. Dorner, President and CEO of HSBC, is HSBC’s “captain of the ship.” She should not only take credit for the fruits of HSBC’s victories but must bear some responsibility for its defeats and mistakes. According to HSBC’s 2010 Form 10-K, dated December 31, 2010, and filed with the U.S. Securities and Exchange Commission on February 28, 2011, at p. 255, “Ms. Dorner’s insight and particular knowledge of HSBC USA’s operations are critical to an effective Board of Directors” and Ms. Dorner “has many years of experience in leadership positions with HSBC and extensive global experience with HSBC, which is highly relevant as we seek to operate our core businesses in support of HSBC’s global strategy.” HSBC needs to have a “global strategy” of filing truthful documents and not wasting the very limited resources of the Courts. For her responsibility she earns a handsome compensation package. According to the 2010 Form 10-k, at pp. 276-277, she earned in 2010 total compensation of $2,306,723. This included, among other things: a base salary of $566,346; a discretionary bonus of $760,417; and, other compensation such as $560 for financial planning and executive tax services; $40,637 for executive travel allowance, $24,195 for housing and furniture allowance, $39,399 for relocation expenses and $3,754 for executive physical and medical expenses.

Therefore, the Court will examine the conduct of plaintiff HSBC and plaintiff’s counsel, in a hearing, pursuant to 22 NYCRR § 130-1.1, to determine if plaintiff HSBC, [*19]by its President and CEO, Irene M. Dorner, and plaintiff’s counsel Frank M. Cassara, Esq. and his firm Shapiro, DiCaro & Barak, LLC, engaged in frivolous conduct, and to allow plaintiff HSBC, by its President and CEO, Irene M. Dorner, and plaintiff’s counsel Frank M. Cassara, Esq. and his firm Shapiro, DiCaro & Barak, LLC a reasonable opportunity to be heard.


Conclusion

Accordingly, it is

ORDERED, that the motion of plaintiff, HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, for an order of reference for the premises located at 931 Gates Avenue, Brooklyn, New York (Block 1632, Lot 57, County of Kings), is denied with prejudice; and it is further

ORDERED, that because plaintiff, HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, lacks standing in this foreclosure action, the instant complaint, Index No. 9320/09 is dismissed with prejudice; and it is further

ORDERED, that the Notice of Pendency filed with the Kings County Clerk on April 16, 2009 by plaintiff, HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, in an action to foreclose a mortgagefor real property located at 931 Gates Avenue, Brooklyn, New York (Block 1632, Lot 57, County of Kings), is cancelled and discharged; and it is further

ORDERED, that it appearing that plaintiff HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, plaintiff’s counsel Frank M. Cassara, Esq. and his firm Shapiro, DiCaro & Barak, LLC engaged in “frivolous conduct,” as defined in the Rules of the Chief Administrator, 22 NYCRR § 130-1 (c), and that pursuant to the Rules of the Chief Administrator, 22 NYCRR § 130.1.1 (d), “[a]n award of costs or the imposition of sanctions may be made . . . upon the court’s own initiative, after a reasonable opportunity to be heard,” this Court will conduct a hearing affording: plaintiff HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST 2007-2, by its President and Chief Executive Officer, Irene M. Dorner; plaintiff’s counsel Frank M. Cassara, Esq.; and, his firm Shapiro, DiCaro & Barak, LLC; “a reasonable opportunity to be heard” before me in Part 27, on Friday, July 15, 2011, at 2:30 P.M., in Room 479, 360 Adams Street, Brooklyn, NY 11201; and it is further

ORDERED, that Ronald David Bratt, Esq., my Principal Law Clerk, is directed to serve this order by first-class mail, upon: Irene M. Dorner, President and Chief Executive Officer of plaintiff, HSBC BANK USA, N.A., AS INDENTURE TRUSTEE FOR THE REGISTERED NOTEHOLDERS OF RENAISSANCE HOME EQUITY LOAN TRUST [*20]2007-2, 452 Fifth Avenue, New York, New York 10018; Frank M. Cassara, Esq., Shapiro DiCaro & Barak, LLC, 250 Mile Crossing Boulevard, Suite One, Rochester, New York 14624; and, Shapiro DiCaro & Barak, LLC, 250 Mile Crossing Boulevard, Suite One, Rochester, New York 14624.

This constitutes the Decision and Order of the Court.

ENTER

___________________________

HON. ARTHUR M. SCHACKJ. S. C.


[ipaper docId=59410573 access_key=key-cs4bqg6pw7e5l15r2he height=600 width=600 /]

Scott Anderson Signature Variance


Posted in STOP FORECLOSURE FRAUDComments (4)

[NYSC] NY JUDGE DENIES 42 FORECLOSURE CASES “HAMP, AFFIDAVIT” ISSUES

[NYSC] NY JUDGE DENIES 42 FORECLOSURE CASES “HAMP, AFFIDAVIT” ISSUES


EXCERPT:

In submitting any future orders of reference said application shall include an affidavit from plaintiff indicating whether this loan is subject to a H.A.M.P. review and whether plaintiff is or is not prevented from proceeding with the instant foreclosure by reason of any applicable federal H.A.M.P. directives.

Read each below as some are worded differently…

[ipaper docId=45801709 access_key=key-1bx4piyyyebnoga2vmrr height=600 width=600 /]

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Posted in STOP FORECLOSURE FRAUDComments (3)


GARY DUBIN LAW OFFICES FORECLOSURE DEFENSE HAWAII and CALIFORNIA
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