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Banks face crisis in bungled commercial mortgages

Banks face crisis in bungled commercial mortgages


Oh yes, MERS is in this rabbit hole as well: From a 10/10 post EXCLUSIVE | NYSC COMMERCIAL (CMBS), MERS and a $65 MILLION NOTE

If this doesn’t do them in then look for the Next Robo-Signing Scandal: RePOST: CHASE BANK v. GERGIS | NY Civ. Court “ROBO-TESTIMONY, WAMU, CREDIT-CARD DEBT” Dismissed w/ PREJUDICE

Either way the banks are screwed on these as well.

CBS-

The nation’s banks are looking at a robo-signing problem with commercial real estate which may dwarf the one for home mortgages, according to a new study.

Research by Harbinger Analytics Group shows the widespread use of inaccurate, fraudulent documents for land title underwriting of commercial real estate financing. According to the report:

This fraud is accomplished through inaccurate and incomplete filings of statutorily required records (commercial land title surveys detailing physical boundaries, encumbrances, encroachments, etc.) on commercial properties in California, many other western states and possibly throughout most of the United States.

[CBS NEWS]

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NJDC denies foreclosure law firm’s motion for a gag order silencing homeowners’ counsel in proposed RICO class action against Phelan Hallinan & Schmieg and Wells Fargo

NJDC denies foreclosure law firm’s motion for a gag order silencing homeowners’ counsel in proposed RICO class action against Phelan Hallinan & Schmieg and Wells Fargo


IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

CHARLES GILES, et al.,
Plaintiffs,

v.

PHELAN, HALLINAN & SCHMIEG,
L.L.P., et al.,
Defendants.

This matter is before the Court on the motion for temporary
restraints and entry of a protective order by Defendants Phelan
Hallinan & Schmieg, P.C., Francis S. Hallinan, Rosemarie Diamond,
Full Spectrum Services, Inc., and Land Title Services of New
Jersey, Inc. (“Moving Defendants”) [Docket Item 5]; the Court
having received briefing in support of the motion by the Moving
Defendants on November 21, 2011 and in opposition to the motion
by Plaintiffs on November 28, 2011; the Court having heard oral
argument on the motion from the Parties at a hearing on November
28, 2011;

For the reasons articulated in the Oral Opinion read into
the record at the November 28, 2011 hearing; and for good cause
shown

IT IS, this 28th day of November, 2011, ORDERED that the motion for temporary restraints and entry
of a protective order shall be, and hereby is, DENIED without
prejudice.

s/ Jerome B. Simandle
JEROME B. SIMANDLE
U.S. District Judge

PLAINTIFFS’ MEMORANDUM IN OPPOSITION TO DEFENDANTS’ MOTION FOR PROTECTIVE ORDER

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NC court weighs if foreclosure needs original docs

NC court weighs if foreclosure needs original docs


This part of the article doesn’t settle well for me:

The hearing in a state traditionally friendly to banks and home to U.S. industry leader Bank of America comes as paperwork problems have gummed up foreclosures nationwide.

Boston Herald-

RALEIGH, N.C. — North Carolina’s Supreme Court heard arguments today in a case that could decide whether mortgage lenders can foreclose on a home without producing original documents that prove they’re owed the money.

The hearing in a state traditionally friendly to banks and home to U.S. industry leader Bank of America comes as paperwork problems have gummed up foreclosures nationwide.

Those problems include missing documents validating a mortgage transaction and unqualified employees “robo-signing” affidavits improperly swearing to the accuracy of overdue mortgage debts. The problem of suspect documents could create legal trouble for homeowners and mortgage lenders for years.

[BOSTON HERALD]

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DOBSON v. WELLS FARGO | AMICUS CURIAE BRIEF IN SUPPORT OF APPELLANT LINDA G. DOBSON

DOBSON v. WELLS FARGO | AMICUS CURIAE BRIEF IN SUPPORT OF APPELLANT LINDA G. DOBSON


SUPREME COURT OF NORTH CAROLINA

LINDA G. DOBSON,

Plaintiff-Appellant,

v.

SUBSTITUTE TRUSTEE SERVICES, 
INC., Substitute Trustee and WELLS
FARGO BANK MINNESOTA, N.A.
as Trustee for Equivantage Home Equity
Loan Trust, 1996-4, Note Holder,
EQUVANTAGE, INC., and AMERICA‘S
SERVICING COMPANY,

Defendants-Appellees.

****************************
PROPOSED BRIEF OF AMICI CURIAE NORTH CAROLINA JUSTICE CENTER, NORTH CAROLINA ADVOCATES FOR JUSTICE, CENTER FOR RESPONSIBLE LENDING, MAINE ATTORNEYS SAVING HOMES, THE FINANCIAL PROTECTION LAW CENTER, AARP, AND THE NATIONAL ASSOCIATION OF CONSUMER ADVOCATES IN SUPPORT OF PLAINTIFF-APPELLANT
*****************************

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Mortgage Electronic Registration Systems, Inc. v. Reiley | Wisconsin Appeals Court Reverses “whose mortgage is in a superior position”

Mortgage Electronic Registration Systems, Inc. v. Reiley | Wisconsin Appeals Court Reverses “whose mortgage is in a superior position”



COURT OF APPEALS

DECISION

DATED AND FILED


July 26, 2011

A. John Voelker

Acting Clerk of Court of Appeals




NOTICE



This opinion is subject to further editing. If published, the official version will appear in the bound volume of the Official Reports.


A party may file with the Supreme Court a petition to review an adverse decision by the Court of Appeals. SeeWis. Stat. § 808.10 and Rule 809.62.




Appeal No.

2010AP2336

Cir. Ct. No. 2008CV555

STATE OF WISCONSIN

IN COURT OF APPEALS


DISTRICT II




Mortgage Electronic Registration Systems, Inc., as

nominee for New Century Mortgage Corporation,

Plaintiff-Respondent,

v.

Steven M. Reiley, Sabrina L. Reiley and M&M Construction,

LLC,

Defendants,

Solutions Properties, Inc.,

Defendant-Appellant.



APPEAL from a judgment of the circuit court for Walworth County: JOHN R. RACE, Judge. Reversed and cause remanded for further proceedings.

Before Hoover, P.J., Peterson and Brunner, JJ.

¶1 PER CURIAM.   Solutions Properties, Inc., appeals a summary judgment in favor of Mortgage Electronic Registration Systems, Inc. (“MERS”). The issue concerns whose mortgage is in a superior position. We conclude factual disputes precluded summary judgment and therefore reverse and remand.

¶2 This matter arises from the purchase of real estate in Lake Geneva by Steven and Sabrina Reiley from William Roth. The Reileys sought a mortgage from New Century Mortgage Corporation to finance the purchase. New Century approved a loan for $180,000 but required a first mortgage lien as security. The Reileys also planned to sign a mortgage with M&M Construction, LLC, for $45,000 at closing. Sheila and Michael Minon were owners of M&M, and the M&M mortgage related to home remodeling.

¶3 New Century sought a title commitment from New Millenium Title Corporation, located in Brookfield. New Millenium contracted with remote agent Gerald Wilcox to act as its agent to close the loan in Walworth County. The closing occurred on December 29, 2006. Sheila Minon recorded the M&M mortgage on January 9, 2007.[1] The deed from Roth and the mortgage to MERS, as nominee for New Century, were recorded on February 5, 2007.

¶4 Nearly a year after the sale to the Reileys, M&M assigned its mortgage to Solutions Properties. Solutions Properties’ principal operating officer, Douglas Norton, had contacted the Minons after their names came up as defendants in a foreclosure action. Norton was interested in purchasing their property before it went through foreclosure. Instead, Solutions Properties purchased M&M’s mortgage.

¶5 Prior to purchasing the M&M mortgage, Norton received a title report that showed the M&M mortgage to be in first priority. Norton also instructed his assistant to contact the Walworth County Register of Deeds to confirm that the M&M mortgage was recorded prior to other mortgages or liens on the property. Norton also testified at his deposition that the Minons told him “that there was a fire, that there was a $180,000 second mortgage that was put into the house to improve it and that satisfied any lingering question that I would have had about the 45,000 first and 180,000 second. That was a reasonable explanation to me.”

¶6 The Reileys subsequently defaulted on the loan to New Century. When a foreclosure action was about to be commenced, it was determined that the M&M mortgage was recorded prior to New Century’s mortgage. MERS then commenced this action for a declaratory judgment to determine the priority of the two mortgages. The circuit court granted summary judgment in favor of MERS, concluding that “the Defendant Solutions Properties was clearly on notice that the Plaintiff’s lien was a purchase money mortgage.” Therefore, the court reasoned that MERS’ mortgage had priority as a matter of law. Solutions Properties now appeals.

¶7 We review summary judgment independently, applying the same methodology as the circuit court. Green Spring Farms v. Kersten, 136 Wis. 2d 304, 315-17, 401 N.W.2d 816 (1987). The methodology is often recited and we need not repeat it. Summary judgment is appropriate when there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2).[2]

¶8 Solutions Properties argues that under Wis. Stat. §§ 706.08 and 706.09, the M&M mortgage is superior in priority because it was recorded earlier than the New Century mortgage. Solutions Properties contends that it was a good faith purchaser without actual or constructive notice of any adverse claims.

9 Wisconsin Stat. § 706.08(1)(a) protects purchasers of real estate against adverse claims that are not properly recorded as provided by law. See Associates Fin. Servs. Co. v. Brown, 2002 WI App 300, ¶9, 258 Wis. 2d 915, 656 N.W.2d 56. It provides that “every conveyance that is not recorded as provided by law shall be void as against any subsequent purchaser, in good faith and for a valuable consideration, of the same real estate or any portion of the same real estate whose conveyance is recorded first.” Wis. Stat. § 706.08(1)(a). A purchaser or mortgagee in good faith is one without notice of existing rights in land. Grosskopf Oil, Inc. v. Winter, 156 Wis. 2d 575, 584, 457 N.W.2d 514 (Ct. App. 1990). Wisconsin Stat. § 706.09(1) provides that “[a] purchaser for a valuable consideration, without notice as defined in sub. (2) … shall take” priority over an adverse claim. “To be entitled to the benefits of [§ 706.09], a purchaser must not have notice of the adverse claim ….” Schapiro v. Security Sav. & Loan Ass’n, 149 Wis. 2d 176, 186, 441 N.W.2d 241 (Ct. App. 1989). Though § 706.08 does not use the word “notice,” the requirement that a bona fide purchaser lack notice of an adverse claim has long been understood to be a part of the statute. Bank of New Glarus v. Swartwood, 2006 WI App 224, ¶24, 297 Wis. 2d 458, 725 N.W.2d 944.

¶10 MERS insists Solutions Properties is not a good faith purchaser without notice because, had Norton searched the record, he would have discovered the recording of the mortgage to New Century from the Reileys, which was recorded immediately after the deed. MERS argues that a review of that mortgage shows at the top of the first page in bold letters, “Purchase Money MORTGAGE.” MERS contends that under Northern State Bank v. Toal, 69 Wis. 2d 50, 230 N.W.2d 153 (1975), a purchase money mortgage is superior to any other claim as a matter of law.

¶11 However, MERS overstates the holding of Toal. The issue in that case was whether Toal’s purchase money mortgage on real estate took precedence over a judgment a creditor held against Toal before he acquired the real estate covered by the mortgage. Id. at 51. Toal listed the prior judgment as a debt when he made the home mortgage loan application. Id. at 51-52. He later defaulted on the mortgage payments, and the judgment holder and the lender disputed which took priority, the prior judgment or the purchase money mortgage. Id. Relying upon authority stating that a purchase money mortgage has priority over earlier judgments and judgment liens against the mortgagor, our supreme court ruled in favor of the lender. Id. at 55-56. The court considered, however, only the priority of a purchase money mortgage in relation to pre-existing judgments against the mortgagee, not one mortgage’s priority over another. Accordingly, Toal is not dispositive.

¶12 Here, a factual dispute concerning whether Norton performed a reasonable inquiry precluded summary judgment. For instance, Solutions Properties asserts that it contacted Sheila Minon, an M&M principal, and obtained a letter report from her. Solutions also called the register of deeds. MERS concedes that “both Ms. Minon and the register of deeds confirmed that M&M had a first mortgage,” but claims that Solutions Properties “should have been aware that these representations were contrary to the actual record.” However, MERS does not fully elaborate on exactly why this information was contrary to the record. In fact, the record showed that the M&M mortgage recorded prior to the New Century mortgage contained no indication that there were mortgages or liens that had priority.

¶13 In addition, MERS refers to closing documents, including a HUD-1 settlement statement reflecting that the parties to the closing anticipated that a second mortgage in the amount of $45,000 in favor of M&M was to be recorded after the mortgage to New Century. MERS also refers to the Reileys’ loan application that required New Century be granted a first mortgage lien on the real estate. However, it is unclear whether these documents were available in the public record, or if the documents were even referred to in the public record.

¶14 MERS also concedes a factual dispute concerning whether Sheila Minon told representatives of Solutions Properties “that M&M had a second mortgage that had been recorded as a first.” As mentioned previously, Norton testified at his deposition that the Minons told him “that there was a fire in the house” and that “there was a $180,000 second mortgage that was put into the house to improve it ….” MERS also insists that Solutions Properties “should have called New Century to inquire as to the nature of its interest ….” However, we have stated that purchasers for value are not required to see if there is any way conceivable that an interest might possibly be discovered. See Associates Fin. Servs., 258 Wis. 2d 915, ¶14.

¶15 Accordingly, we conclude the circuit court erred by determining that Solutions Properties was on notice of an adverse claim as a matter of law. We therefore reverse the grant of summary judgment and remand for further proceedings concerning the reasonableness of Solutions Properties’ inquiry.[3]

By the Court.—Judgment reversed and cause remanded for further proceedings.

This opinion will not be published. See Wis. Stat. Rule 809.23(1)(b)5.


[1] After closing, Wilcox hand delivered the documents to New Millennium, except for the mortgage to M&M, which was retained by Wilcox. Wilcox faxed to New Millennium the M&M mortgage. Copies of the deed and M&M mortgage as executed at the closing were sent to New Century for certification.

There are discrepancies between the certified M&M mortgage that was faxed to New Millennium and the M&M mortgage that was recorded in Walworth County. The first page of the certified mortgage states that the mortgage was subject to the first mortgage to New Century. The first page of the recorded M&M mortgage states that the mortgage was subject to “NONE.” The fourth page of the recorded mortgage shows a Liberty Banc Mortgage fax number while the certified mortgage does not.

[2] References to the Wisconsin Statutes are to the 2005-06 version unless noted.

[3] MERS also argues that the circuit court’s decision rested upon equitable principles. However, we cannot discern that the court based its ruling on equitable principles and therefore decline to address the doctrine of equitable subrogation.

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BANK OF NEW YORK v. SILVERBERG | NY 2nd APPELLATE DIVISION “MERS DOES NOT HAVE RIGHT TO FORECLOSE OR ASSIGN IF NOT HOLDER OF NOTE”

BANK OF NEW YORK v. SILVERBERG | NY 2nd APPELLATE DIVISION “MERS DOES NOT HAVE RIGHT TO FORECLOSE OR ASSIGN IF NOT HOLDER OF NOTE”


Decided on June 7, 2011

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE DIVISION : SECOND JUDICIAL DEPARTMENT

ANITA R. FLORIO, J.P.
THOMAS A. DICKERSON
JOHN M. LEVENTHAL
ARIEL E. BELEN, JJ.
2010-00131
(Index No. 17464-08)

[*1]Bank of New York, etc., respondent,v

Stephen Silverberg, et al., appellants, et al., defendants.

APPEAL by the defendants Stephen Silverberg and Fredrica Silverberg, in an action to foreclose a mortgage, from an order of the Supreme Court (Denise F. Molia, J.), dated September 24, 2008, and entered in Suffolk County, which denied their motion pursuant to CPLR 3211(a)(3) to dismiss the complaint insofar as asserted against them for lack of standing. Stephen C. Silverberg, PLLC, Uniondale N.Y., for appellants.

McCabe, Weisberg & Conway, P.C., New Rochelle, N.Y. (Lisa
L. Wallace and Doron Zanani of counsel), for respondent.

OPINION & ORDER

LEVENTHAL, J.This matter involves the enforcement of the rules that govern real property and whether such rules should be bent to accommodate a system that has taken on a life of its own. The issue presented on this appeal is 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. We answer this question in the negative.

In October 2006 the defendants Stephen Silverberg and Fredrica Silverberg (hereinafter together the defendants) borrowed the sum of $450,000 from Countrywide Home Loans, Inc. (hereinafter Countrywide), to purchase residential real property in Greenlawn, New York (hereinafter the property). The loan was secured by a mortgage on the property (hereinafter the initial mortgage). The initial mortgage refers to MERS as the mortgagee for the purpose of recording, and provides that the underlying promissory note is in favor of Countrywide [FN1]. Further, the initial mortgage provides that “MERS holds only legal title to the rights granted by the [defendants] . . . but, if necessary to comply with law or custom,” MERS purportedly has the right to foreclose and “to take any action required of [Countrywide].” On November 2, 2006, the initial mortgage was recorded in the office of the Suffolk County Clerk.

On April 23, 2007, the defendants executed a second mortgage on the subject property in favor of MERS, as named mortgagee and nominee of Countrywide. The defendants [*2]simultaneously executed a note in favor of Countrywide, secured by the second mortgage. The promissory note secured by the second mortgage provided that payment would be made to Countrywide, and that Countrywide “may transfer this Note.” The second mortgage was recorded in the office of the Suffolk County Clerk on June 12, 2007.

In sections entitled “Borrower’s Transfer to Lender of Rights in the Property” set forth in both the initial mortgage and the second mortgage, those documents provide:

“[The Borrowers] understand and agree that MERS holds only legal title to the rights granted by [the Borrowers] in this Security Instrument, but, if necessary to comply with law or custom, MERS (as nominee for Lender and Lender’s successors and assigns) has the right:

“(A) to exercise any or all of those rights, [granted by the Borrowers to Countrywide] including, but not limited to, the right to foreclose and sell the Property; and

“(B) to take any action required of Lender including, but not limited to, releasing and canceling this Security Instrument.”

Consolidation Agreement

Also in April 2007, the defendants executed a consolidation agreement in connection with the property in the sum of $479,000 in favor of MERS, as mortgagee and nominee of Countrywide . Countrywide was the named lender and note holder. The consolidation agreement purportedly merged the two prior notes and mortgages into one loan obligation. The consolidation agreement was recorded in the office of the Suffolk County Clerk on June 12, 2007. The consolidation agreement, as with the prior mortgages, recites that MERS was “acting solely as a nominee for [Countrywide] and [Countrywide’s] successors and assigns . . . For purposes of recording this agreement, MERS is the mortgagee of record.” Countrywide, however, was not a party to the consolidation agreement.

In December 2007 the defendants defaulted on the consolidation agreement. Meanwhile, on April 30, 2008, by way of a “corrected assignment of mortgage,” MERS, as Countrywide’s nominee, assigned the consolidation agreement to the Bank of New York, as Trustee For the Benefit of the Certificate Holders, CWALT, Inc., Alternate Loan Trust 2007-14-T2, Mortgage Pass-Through Certificates Series 2007-14T2 (hereinafter the plaintiff). On May 6, 2008, the plaintiff commenced this mortgage foreclosure action against the defendants, among others.

In June 2008 the defendants moved pursuant to CPLR 3211(a)(3) to dismiss the complaint insofar as asserted against them for lack of standing. In support of their motion, the defendants submitted, inter alia, the underlying mortgages, the summons and complaint, the second note, and an attorney’s affirmation. In the affirmation, the defendants argued, among other things, that the complaint failed to establish a chain of ownership of the notes and mortgages from Countrywide to the plaintiff. In opposition to the defendants’ motion, the plaintiff submitted, inter alia, the corrected assignment of mortgage dated April 30, 2008.
The Order Appealed From

In an order dated September 24, 2008, the Supreme Court denied the defendant’s motion, concluding that, prior to the commencement of the action, MERS, as Countrywide’s nominee, and on Countrywide’s behalf, assigned the mortgages described in the consolidation agreement. Hence, the Supreme Court determined that the plaintiff was the owner of the “consolidated Note and Mortgage” and, thus, the proper party to commence the action.

On appeal, the defendants argue that the plaintiff lacks standing to sue because it did not own the notes and mortgages at the time it commenced the foreclosure action. Specifically, the defendants contend that neither MERS nor Countrywide ever transferred or endorsed the notes described in the consolidation agreement to the plaintiff, as required by the Uniform Commercial Code. Moreover, the defendants assert that the mortgages were never properly assigned to the plaintiff because MERS, as nominee for Countrywide, did not have the authority to effectuate an assignment of the mortgages. The defendants further assert that the mortgages and notes were bifurcated, rendering the mortgages unenforceable and foreclosure impossible, and that because of such bifurcation, MERS never had an assignable interest in the notes. The defendants also contend [*3]that the Supreme Court erred in considering the corrected assignment of mortgage because it was not authenticated by someone with personal knowledge of how and when it was created, and was improperly submitted in opposition to the motion.
MERS

“In 1993, the MERS system was created by several large participants in the real estate mortgage industry to track ownership interests in residential mortgages” (Matter of MERSCORP, Inc. v Romaine, 8 NY3d 90, 96). MERS was intended to “streamline the mortgage process by using electronic commerce to eliminate paper.”[FN2] MERS’s implementation followed the delays occasioned by local recording offices, which were at times slow in recording instruments because of complex local regulations and database systems that had become voluminous and increasingly difficult to search (see Peterson, Foreclosure, Subprime Mortgage Lending, and the Mortgage Electronic Registration System, 78 U Cin L Rev 1359, 1366 [2010]).

“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” (Matter of MERSCORP, Inc. v Romaine, 8 NY3d at 96 [internal footnotes omitted]).

The MERS system facilitated the transfer of loans into pools of other loans which were then sold to investors as securities (see Peterson, at 1361-1362). MERS delivers savings to the participants in the real estate mortgage industry by allowing those entities to avoid the payment of fees which local governments require to record mortgage assignments (see Peterson at 1368-1369).

Lenders identify MERS as nominee and mortgagee for its members’ successors and assignees. MERS remains the mortgagee of record in local county recording offices regardless of how many times the mortgage is transferred, thus freeing MERS’s members from paying the recording fees that would otherwise be furnished to the relevant localities (id.; see Matter of MERSCORP, Inc. v Romaine, 8 NY3d at 100). This leaves borrowers and the local county or municipal recording offices unaware of the identity of the true owner of the note, and extinguishes a source of revenue to the localities. According to MERS, any loan registered in its system is “inoculated against future assignments because MERS remains the mortgagee no matter how many times servicing is traded.”[FN3] Moreover, MERS does not lend money, does not receive payments on promissory notes, and does not service loans by collecting loan payments.
Analysis

Relevant to our determination is the decision of the Court of Appeals in Matter of MERSCORP, Inc. v Romaine (8 NY3d 90), which held that the Suffolk County Clerk was compelled to record and index mortgages, assignments of mortgages, and discharges of mortgages that named MERS as the lender’s nominee or mortgagee of record. In a concurring opinion, Judge Carmen Beauchamp Ciparick specified that the issue of whether MERS has standing to prosecute a foreclosure action remained for another day (id. at 100). In a dissent, former Chief Judge Judith S. Kaye posited that the MERS system raised several concerns, including the elimination of the public records which document mortgage loan ownership (id. at 100-105).

The principal issue ripe for determination by this Court, and which was left unaddressed by the majority in Matter of MERSCORP (id.), is whether MERS, as nominee and mortgagee for purposes of recording, can assign the right to foreclose upon a mortgage to a plaintiff in a foreclosure action absent MERS’s right to, or possession of, the actual underlying promissory note.

Standing requires an inquiry into whether a litigant has “an interest . . . in the lawsuit that the law will recognize as a sufficient predicate for determining the issue at the litigant’s request” [*4](Caprer v Nussbaum, 36 AD3d 176, 182; see New York State Assn. of Nurse Anesthetists v Novello, 2 NY3d 207, 211; Wells Fargo Bank Minn., N.A. v Mastropaolo, 42 AD3d 239, 242). Where, as here, the issue of standing is raised by a defendant, a plaintiff must prove its standing in order to be entitled to relief (see U.S. Bank, N.A. v Collymore, 68 AD3d 752, 753; Wells Fargo Bank Minn., N.A. v Mastropaolo, 42 AD3d at 242). In a mortgage foreclosure action, a plaintiff has standing where it is both the holder or assignee of the subject mortgage and the holder or assignee of the underlying note at the time the action is commenced (see U.S. Bank, N.A. v Collymore, 68 AD3d at 753; Countrywide Home Loans, Inc. v Gress, 68 AD3d 709, 709; Wells Fargo Bank, N.A. v Marchione, 69 AD3d 204, 207-208; Mortgage Elec. Registration Sys., Inc. v Coakley, 41 AD3d 674, 674; Federal Natl. Mtge. Assn. v Youkelsone, 303 AD2d 546, 546-547; First Trust Natl. Assn. v Meisels, 234 AD2d 414).

As a general matter, once a promissory note is tendered to and accepted by an assignee, the mortgage passes as an incident to the note (see Mortgage Elec. Registration Sys., Inc. v Coakley, 41 AD3d 674; Smith v Wagner, 106 Misc 170, 178 [“assignment of the debt carries with it the security therefor, even though such security be not formally transferred in writing”]; see also Weaver Hardware Co. v Solomovitz, 235 NY 321, 331-332 [“a mortgage given to secure notes is an incident to the latter and stands or falls with them”]; Matter of Falls, 31 Misc 658, 660, affd 66 App Div 616 [“The deed being given as collateral for the payment of the note [,] the transfer of the note carried the security”]).

By contrast, “a transfer of the mortgage without the debt is a nullity, and no interest is acquired by it” (Merritt v Bantholick, 36 NY 44, 45; see Carpenter v Longan, 83 US 271, 274 [an assignment of the mortgage without the note is a nullity]; US Bank N.A. v Madero, 80 AD3d 751, 752; U.S. Bank, N.A. v Collymore, 68 AD3d at 754; Kluge v Fugazy, 145 AD2d 537, 538 [plaintiff, the assignee of a mortgage without the underlying note, could not bring a foreclosure action]; Flyer v Sullivan, 284 App Div 697, 698 [mortgagee’s assignment of the mortgage lien, without assignment of the debt, is a nullity]; Beak v Walts, 266 App Div 900). A “mortgage is merely security for a debt or other obligation and cannot exist independently of the debt or obligation” (FGB Realty Advisors v Parisi, 265 AD2d 297, 298). Consequently, the foreclosure of a mortgage cannot be pursued by one who has no demonstrated right to the debt (id.; see Bergman on New York Mortgage Foreclosures § 12.05[1][a][1991]).

The defendants contend, among other things, that because the plaintiff failed to provide proof of recording of the corrected assignment of the mortgage prior to the commencement of the action, it may be inferred that the plaintiff did not own the notes and mortgages prior to that date. However, this particular contention is without merit, as an assignment of a note and mortgage need not be in writing and can be effectuated by physical delivery (see LaSalle Bank Natl. Assn. v Ahearn, 59 AD3d 911, 912). Moreover, ” [n]o special form or language is necessary to effect an assignment as long as the language shows the intention of the owner of a right to transfer it'” (Suraleb, Inc. v International Trade Club, Inc., 13 AD3d 612, 612, quoting Tawil v Finkelstein Bruckman Wohl Most & Rothman, 223 AD2d 52, 55).

Here, the consolidation agreement purported to merge the two prior notes and mortgages into one loan obligation. Countrywide, as noted above, was not a party to the consolidation agreement. ” Either a written assignment of the underlying note or the physical delivery of the note prior to the commencement of the foreclosure action is sufficient to transfer the obligation, and the mortgage passes with the debt as an inseparable incident'” (US Bank N.A. v Madero, 80 AD3d at 753, quoting U.S. Bank, N.A. v Collymore, 68 AD3d at 754; see LaSalle Bank Natl. Assn. v Ahearn, 59 AD3d at 912). The plaintiff relies upon the language in the consolidation agreement, which provides that MERS was “acting solely as a nominee for [Countrywide] and [Countrywide’s] successors and assigns . . . For purposes of recording this agreement, MERS is the mortgagee of record.” However, as “nominee,” MERS’s authority was limited to only those powers which were specifically conferred to it and authorized by the lender (see Black’s Law Dictionary 1076 [8th ed 2004] [defining a nominee as “(a) person designated to act in place of another, (usually) in a very limited way”]). Hence, although the consolidation agreement gave MERS the right to assign the mortgages themselves, it did not specifically give MERS the right to assign the underlying notes, and 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 Squitieri, 29 Misc 3d 1225[A], 2010 NY Slip Op 52000[U]; LNV Corp. v Madison Real Estate, LLC, 2010 NY Slip Op 33376[U]; LPP Mtge. Ltd. [*5]v Sabine Props., LLC, 2010 NY Slip Op 32367[U]; Bank of NY v Mulligan, 28 Misc 3d 1226[A], 2010 NY Slip Op 51509[U]; OneWest Bank, F.S.B. v Drayton, 29 Misc 3d 1021; Bank of N.Y. v Alderazi, 28 Misc 3d 376, 379-380 [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, N.A. v Yeasmin, 27 Misc 3d 1227[A], 2010 NY Slip Op 50927[U]; HSBC Bank USA, N.A. v Vasquez, 24 Misc 3d 1239[A], 2009 NY Slip Op 51814[U]; Bank of N.Y. v Trezza, 14 Misc 3d 1201[A], 2006 NY Slip Op 52367[U]; LaSalle Bank Natl. Assn. v Lamy, 12 Misc 3d 1191[A], 2006 NY Slip Op 51534[U]; Matter of Agard, 444 BR 231; but see US Bank N.A. v Flynn, 27 Misc 3d 802).

Therefore, assuming that the consolidation agreement transformed MERS into a mortgagee for the purpose of recording—even though it never loaned any money, never had a right to receive payment of the loan, and never had a right to foreclose on the property upon a default in payment—the consolidation agreement did not give MERS title to the note, nor does the record show that the note was physically delivered to MERS. Indeed, the consolidation agreement defines “Note Holder,” rather than the mortgagee, as the “Lender or anyone who succeeds to Lender’s right under the Agreement and who is entitled to receive the payments under the Agreement.” Hence, the plaintiff, which merely stepped into the shoes of MERS, its assignor, and gained only that to which its assignor was entitled (see Matter of International Ribbon Mills [Arjan Ribbons], 36 NY2d 121, 126; see also UCC 3-201 [“(t)ransfer of an instrument vests in the transferee such rights as the transferor has therein”]), did not acquire the power to foreclose by way of the corrected assignment.

Notwithstanding the foregoing, the plaintiff contends that case law supports its position that MERS has the power to foreclose, where, as here, MERS is identified in a mortgage as nominee and mortgagee for the purpose of recording. In this regard, the plaintiff relies upon Mortgage Elec. Registration Sys., Inc. v Coakley (41 AD3d 674), wherein this Court held that MERS had standing to foreclose a mortgage. In that case, unlike in the current case, the lender had transferred and tendered the promissory note to MERS before the commencement of the foreclosure action (id. at 674). Therefore, we held that MERS had standing to bring the foreclosure action because it “was the lawful holder of the promissory note and of the mortgage, which passed as an incident to the promissory note” (id. at 674 [citations omitted]). Although that determination was a sufficient basis upon which to conclude that MERS had standing, we elaborated, stating,

“further support for MERS’s standing to commence the action may be found on the face of the mortgage instrument itself. Pursuant to the clear and unequivocal terms of the mortgage instrument, [the mortgagor] expressly agreed without qualification that MERS had the right to foreclose upon the premises in the event of a default” (id. at 675).

According to the plaintiff, Coakley indicates that this Court has determined that such broad provisions in mortgages, such as the initial mortgage and second mortgage here, standing alone, grant MERS, as nominee and mortgagee for the purpose of recording, the power to foreclose. On the contrary, the Coakley decision does not stand for that proposition. This Court’s holding in Coakley was dependent upon the fact that MERS held the note before commencing the foreclosure action. In the absence of that crucial fact, the language in the mortgage instrument would not have provided “further support” for the proposition that MERS had the power to foreclose in that case. Furthermore, the language in the initial mortgage and the second mortgage in this case, purportedly granting MERS the right to foreclose, was superseded by the consolidation agreement. Moreover, as discussed above, the broad language relied upon by the plaintiff cannot overcome the requirement that the foreclosing party be both the holder or assignee of the subject mortgage, and the holder or assignee of the underlying note, at the time the action is commenced.

In sum, because MERS was never the lawful holder or assignee of the notes described and identified in the consolidation agreement, the corrected 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.

MERS purportedly holds approximately 60 million mortgage loans (see Michael Powell & Gretchen Morgenson, MERS? It May Have Swallowed Your Loan, New York Times, March 5, 2011), and is involved in the origination of approximately 60% of all mortgage loans in the United States (see Peterson at 1362; Kate Berry, Foreclosures Turn Up Heat on MERS, Am. [*6]Banker, July 10, 2007, at 1). This Court is mindful of the impact that this decision may have on the mortgage industry in New York, and perhaps the nation. Nonetheless, 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.

Accordingly, the Supreme Court should have granted the defendants’ motion pursuant to CPLR 3211(a)(3) to dismiss the complaint insofar as asserted against them for lack of standing. Thus, the order is reversed, on the law, and the motion of the defendants Stephen Silverberg and Fredrica Silverberg pursuant to CPLR 3211(a)(3) to dismiss the complaint insofar as asserted against them for lack of standing is granted.
FLORIO, J.P., DICKERSON, and BELEN, JJ., concur.

ORDERED that the order is reversed, on the law, with costs, and the motion of the defendants Stephen Silverberg and Fredrica Silverberg pursuant to CPLR 3211(a)(3) to dismiss the complaint insofar as asserted against them for lack of standing is granted.

ENTER:

Matthew G. Kiernan

Clerk of the Court

Footnotes

Footnote 1: The promissory note executed in connection with the initial mortgage is not included in the record.

Footnote 2: About Us-Overview, MERS, http://www.mersinc.org/about/index.aspx (last visited Apr. 26, 2011).

Footnote 3: see About Us-Overview, MERS, http://www.mersinc.org/about/index.aspx (last visited Apr. 26, 2011).

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California Appeals Court Reverses Investor Lawsuit | LUTHER v. COUNTRYWIDE FINANCIAL CORP.

California Appeals Court Reverses Investor Lawsuit | LUTHER v. COUNTRYWIDE FINANCIAL CORP.


IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FIVE

DAVID H. LUTHER et al.,
Plaintiffs and Appellants,

v.

COUNTRYWIDE FINANCIAL CORPORATION et al.,
Defendants and Respondents.

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JPMorgan Said to Face SEC Subpoena Along With Credit Suisse

JPMorgan Said to Face SEC Subpoena Along With Credit Suisse


BLOOMBERG-

JPMorgan Chase & Co. (JPM) received a subpoena from the U.S. Securities and Exchange Commission over failed mortgages, a person familiar with the investigation said, as the agency probes banks including Credit Suisse Group AG (CS) for allegedly failing to share refunds from sellers of faulty debt.



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SEC Subpoenas Credit Suisse Over Mortgages: MBIA

SEC Subpoenas Credit Suisse Over Mortgages: MBIA


BLOOMBERG:

“Credit Suisse is now the subject of an investigation by the Securities and Exchange Commission, which issued a subpoena this week seeking the same types of documents as MBIA seeks with this motion,” the bond insurance unit of Armonk, New York-based MBIA Inc. (MBI), said in the filing in New York State Supreme Court. The document, dated April 29, was filed today.


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ATTORNEY GENERAL LORI SWANSON CHARGES ONE OF NATION’S LARGEST “DEBT BUYERS” WITH DEFRAUDING MINNESOTA COURTS AND CITIZENS BY FILING “ROBO-SIGNED” AFFIDAVITS

ATTORNEY GENERAL LORI SWANSON CHARGES ONE OF NATION’S LARGEST “DEBT BUYERS” WITH DEFRAUDING MINNESOTA COURTS AND CITIZENS BY FILING “ROBO-SIGNED” AFFIDAVITS


Minnesota Attorney General Lori Swanson today in a legal filing accused one of the nation’s largest “debt buyers” of defrauding Minnesota courts and citizens by filing false and deceptive “robo-signed” affidavits—generated at its offices in St. Cloud, Minnesota—to collect on old consumer debts that it purchased from credit card companies and others for about three cents on the dollar.

The debt buyer—Midland Funding, LLC and its administrative arm, Midland Credit Management, Inc. (collectively Midland)—has purchased $54.7 billion in old consumer debt from credit card companies and other companies. In 2009, it filed 245,000 lawsuits against individual citizens nationwide, and it has filed over 15,000 lawsuits against citizens in Minnesota courts since 2008. Midland pays for its debt acquisitions with hundreds of millions in financing from some of the nation’s largest banks, including several that sell old debt to it.

“The company put its thumb on the scale of justice to unfairly tilt the collection process in its favor,” said Attorney General Swanson.

The Attorney General said that debt buyers cast a wide net to find people who may owe old bills and often pursue the wrong person altogether or pursue people who paid the bills long ago. In some cases, debt buyers pursue people solely because they have the same or similar name or address as the real debtor. The Attorney General said that Midland has created false and unreliable mass-produced, “robo-signed” affidavits as supposed “proof” of consumer debts in lawsuits against individual citizens in order to obtain judgments against or extract payments from mostly unrepresented citizens, some of whom had no knowledge of any alleged debt.

Source: http://www.ag.state.mn.us/Consumer/PressRelease/110328DebtBuyers.asp

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Oregon Dist. Court Grants T.R.O. For “Failure To Record Assignments, TILA Violation” EKERSON v. Mortgage Electronic Registration System (MERS)

Oregon Dist. Court Grants T.R.O. For “Failure To Record Assignments, TILA Violation” EKERSON v. Mortgage Electronic Registration System (MERS)


IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
PORTLAND DIVISION

DAVID EKERSON,
Plaintiff,
v.
MORTGAGE ELECTRONIC
REGISTRATION SYSTEM
, a
foreign corporation;
CITIMORTGAGE, INC., a foreign
corporation; and CAL-WESTERN
RECONVEYANCE
, a foreign
conrporation,
Defendants.

11-CV-178-HU

TEMPORARY RESTRAINING ORDER


ALEX GOLUBITSKY
Case Dusterhoff LLP
9800 S.W. Beavterton-Hillsdale Hwy
Suite 200
Beaverton, OR 97005
(503) 641-7222
Attorneys for Plaintiff

BROWN, Judge.

This matter comes before the Court on Plaintiff’s Motion (#3) for a Temporary Restraining Order Pursuant to FRCP 65. For the reasons that follow, the Court GRANTS Plaintiff’s Motion and temporarily RESTRAINS Defendants from proceeding with the February 16, 2011, foreclosure sale of Plaintiff’s property.

BACKGROUND

The following facts are taken from Plaintiff’s Complaint:
On November 21, 2006, Plaintiff David Ekerson entered into a promissory note secured by property located at 622 S.E. 71st Street, Hillsboro, Oregon, pursuant to one or more deeds of trust recorded December 5, 2006. According to title records, Citibank was the original mortgagee.

At some point, it appears Defendant Mortgage Electronic Resolution System (MERS) became an assignee of the original lender under the Notes, and on October 12, 2010, MERS “grant[ed], assign[ed], and transfer[red]” to Defendant Citimortgage, Inc., “all beneficial interest under” the November 21, 2006, deed of trust. Decl. of Alex Golubitsky, Ex. D. Also on October 12, 2010, MERS evidently issued a Notice of Default to Plaintiff. MERS’s assignment to Citimortgage, however, was not recorded in Washington County’s records until two days later on October 14, 2010.

In his Complaint, Plaintiff alleges he believes Citimortgage is the “current servicer or owner of the loan, having been assigned the loan by Freddie Mac.” Plaintiff also believes Defendant Cal-Western Reconveyance (CWR) is the trustee in charge of the foreclosure sale.

Plaintiff’s property is scheduled to be sold at public auction on February 16, 2011, based on the Notice of Default that Plaintiff contends was improperly issued by MERS.

On February 10, 2011, Plaintiff filed a Complaint in this Court alleging Defendants violated Oregon’s Unfair Trade Practices Act, Or. Rev. Stat. §§ 646.608(1)(k) and 646.608(2)(n). Plaintiff seeks damages and a declaration as to (1) whether Defendants have standing to foreclose; (2) whether MERS “duly and appropriately recorded all assignments of the beneficial interest in the trust deeds” pursuant to Oregon Revised Statute § 86.735 and whether a nonjudicial foreclosure is allowed by statute; and (3) whether the right of the lender to impose a delinquency charge was properly disclosed in the initial loan agreement pursuant to the Truth in Lending Act (TILA), 15 U.S.C. § 1601, Regulation Z, Part 266.18.

On February 10, 2011, Plaintiff also filed a Motion for Temporary Restraining Order in which Plaintiff moves for the entry of an order preventing Defendants from proceeding with the proposed foreclosure sale of Plaintiff’s property on February 16, 2011.

STANDARDS

A party seeking a temporary restraining order or preliminary injunction must demonstrate (1) it is likely to succeed on the merits, (2) it is likely to suffer irreparable harm in the absence of preliminary relief, (3) the balance of equities tips in its favor, and (4) an injunction is in the public interest.  Winter v. Natural Res. Def. Council, 129 S. Ct. 365, 374 (2008). “The elements of [this] test are balanced, so that a stronger showing of one element may offset a weaker showing of another. For example, a stronger showing of irreparable harm to plaintiff might offset a lesser showing of likelihood of success on the merits.” Alliance For The Wild Rockies v. Cottrell, No. 09-35756, 2011 WL 208360, at *4 (9th Cir. Jan. 25, 2011)(citing Winter, 129 S. Ct. at 392). Accordingly, the Ninth Circuit has held “‘serious questions going to the merits’ and a balance of hardships that tips sharply towards the plaintiff can support issuance of a preliminary injunction, so long as the plaintiff also shows that there is a likelihood of irreparable injury and that the injunction is in the public interest.” Id., at *7.

“An injunction is a matter of equitable discretion” and is “an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” Winter, 129 S. Ct. at 376, 381.

DISCUSSION

I. Merits

Plaintiff seeks an order preventing Defendants from proceeding with the proposed foreclosure sale of Plaintiff’s property as scheduled because, among other things, Defendants “have not followed the appropriate procedures for recording all the deeds and assignments for this property, and therefore lack standing to foreclosure [sic] this property.” Specifically, Plaintiff contends MERS assigned its apparent beneficial interest in the property “to other parties who were not recorded in violation” of Oregon Revised Statute § 86.735.

In Burgett v. Mortgage Electronic Registration Systems, District Judge Michael Hogan explained the mortgage practice engaged in by MERS as follows:

“In 1993, the Mortgage Bankers Association, Fannie Mae, Freddie Mac, the Government National Mortgage Association (Ginnie Mae), the Federal Housing Administration, and the Department of Veterans Affairs created MERS. MERS  provides ‘electronic processing and tracking of [mortgage] ownership and transfers.’ Mortgage lenders, banks, insurance companies, and title companies become members of MERS and pay an annual fee. They appoint MERS as their agent to act on all mortgages that they register on the system. A MERS mortgage is recorded with the particular county’s office of the recorder with ‘Mortgage Electronic Registration System, Inc.’ named as the lender’s nominee or mortgagee of record’ on the mortgage. The MERS member who owns the beneficial interest may assign those beneficial ownership rights or servicing rights to another MERS member.  These assignments are not part of the public record, but are tracked electronically on MERS’s private records. Mortgagors are notified of transfers of servicing rights, but not of transfers of beneficial ownership.”

2010 WL 4282105, at *2 (D. Or. Oct. 20, 2010)(quoting Gerald Korngold, Legal and Policy Choices in the Aftermath of the Subprime and Mortgage Financing Crisis, 60 S.C. L.Rev. 727, 741-42 (2009)). In Burgett, the plaintiff, a mortgagee, brought an action against MERS and the servicer of the plaintiff’s mortgage loan alleging, among other things, a claim for breach of contract and seeking declaratory relief to prevent a foreclosure sale of his property. The plaintiff contended the MERS practice set out above was not permitted under Oregon trust-deed law because it allowed assignment of beneficial interests without recording. Id. The defendants moved for summary judgment. Judge Hogan noted the plaintiff’s contention did not “necessarily mean that the arrangement violates the Oregon Trust Deed Act such that foreclosure proceedings could not be initiated by MERS or its substitute trustee.” Id. Judge Hogan, however, denied the defendants’ motion for summary judgment as to the plaintiff’s request for declaratory relief and claim for breach of contract on the ground that the defendants failed to “record assignments necessary for the foreclosure.” Id., at *3. Judge Hogan reasoned:

Under ORS 86.705(1) a “‘Beneficiary’ means the person named or otherwise designated in a trust deed as the person for whose benefit a trust deed is given, or the person’s successor in interest, and who shall not be the trustee unless the beneficiary is qualified to be a trustee under ORS 86.790(1)(d).” Plaintiff contends that MERS cannot meet this definition because there is no evidence that the trust deed was made to benefit MERS. However, the trust deed  specifically designates MERS as the beneficiary. Judge Henry C. Breithaupt provides a persuasive discussion related to this issue:


[T]he interest of MERS, and those for whom it was a nominee, in question here was recorded and known to Plaintiff when it received the litigation guarantee document prior to starting this action.

The Statutes do not prohibit liens to be recorded in the deed of records of counties under an agreement where an agent will appear as a lienholder for the benefit of the initial lender and subsequent assignees of that lender-even where the assignments of the beneficial interest in the record lien are not recorded. It is clear that such unrecorded assignments of rights are permissible under Oregon’s trust deed statute because ORS 86.735 provides if foreclosure by sale is pursued all prior unrecorded assignments must be filed in connection with the foreclosure. The trust deed statutes therefore clearly contemplate that assignments of the beneficial interests in obligations and security rights will occur and may, in fact, not have been recorded prior to foreclosure. The legislature was clearly aware such assignments occurred and nowhere provided that assignments needed to be recorded to maintain rights under the lien statutes except where foreclosure by sale was pursued.


Letter Decision in Parkin Electric, Inc. v. Saftencu, No. LV08040727, dated March 12, 2009 (attached as Exhibit C to the second declaration of David Weibel (# 60)).

The problem that defendants run into in this case is an apparent failure to record assignments necessary for the foreclosure. As Judge Breithaupt notes, ORS § 86.735 provides that if foreclosure by sale is pursued, all prior unrecorded assignments must be filed in connection with the foreclosure. ORS § 86.735(1) specifically provides The trustee may foreclose a trust deed by advertisement and sale in the manner provided in ORS 86.740 to 86.755 if:

(1) The trust deed, any assignments of the trust deed by the trustee or the beneficiary and any appointment of a successor trustee are recorded in the mortgage records in the counties in which the property described in the deed is situated.


Id., at *2-*3. Judge Hogan noted Oregon Revised Statute § 86.735 requires any assignments of the trust deed by the trustee or the beneficiary and any appointment of a successor trustee to be recorded. The record in Burgett, however, did not reflect all transfers to the subsequent lenders/servicers had been recorded.
Id.
Similarly, in Rinegard-Guirma v. Bank of America, District Judge Garr M. King granted the plaintiff, a mortgagee, a temporary restraining order against the defendants, MERS and others, prohibiting the defendants from conducting a foreclosure sale of the plaintiff’s home because the plaintiff established “nothing [was] recorded with Multnomah County [that] demonstrates that LSI Title Company of Oregon, LLC is the successor trustee. No. 10-CV-1065-PK, 2010 WL 3655970, at *2 (D. Or. Sept. 15, 2010). Judge King reasoned:

Pursuant to ORS 86.790, the beneficiary may appoint a successor trustee. However, only “[i]f the appointment of the successor trustee is recorded in the mortgage records of the county or counties in which the trust deed is recorded” is the successor trustee “vested with all the powers of the original trustee.” ORS 86.790(3). Accordingly, unless the appointment of LSI Title Company of Oregon, LLC was recorded, the purported successor trustee has no “power of sale” authorizing it to foreclose Rinegard-Guirma’s property. See ORS 86.710 (describing trustee’s power of sale); ORS 86.735 (permitting foreclosure by advertisement and sale but only if “any appointment of a successor trustee [is] recorded in the mortgage records in the counties in which the property described in the deed is situated”).

Similarly, she is likely to experience irreparable harm if her home is foreclosed upon.

Id.

Plaintiff also contends this foreclosure proceeding is defective because there has not been established any basis in law for Defendants to have assessed a $77,000.00 delinquency charge which far exceeds the actual loan balance. Plaintiff contends this is a violation of TILA.

The Court finds persuasive the reasoning in Burgett and Rinegard-Guirma as to MERS status in the case on this record. The Court, therefore, concludes Plaintiff has established he is likely to succeed at least as to his request for declaratory judgment related to Defendants’ failure to comply with Oregon Revised Statute § 86.735. Plaintiff also has established MERS, who was the recorded beneficiary of the trust deed, assigned successor trustees to the trust deed but failed to record the appointment of any successor trustee as required before a nonjudicial foreclosure sale may be conducted under Oregon law.

The Court also finds there is a legitimate basis to be concerned that the alleged $77,000.00 delinquency has been assessed improperly. Plaintiff also has established he is likely to experience irreparable harm if the scheduled foreclosure proceeds unabated. The Court, therefore, concludes the balance of hardships tips sharply in Plaintiff’s favor, and there are at least serious questions as to the merits of Plaintiff’s request for declaratory judgment.

Accordingly, the Court GRANTS Plaintiff’s Motion for a Temporary Restraining Order and hereby RESTRAINS
Defendants from proceeding with the February 16, 2011, foreclosure sale of Plaintiff’s property.

II. Notice under Federal Rule of Civil Procedure 65

Federal Rule of Civil Procedure 65(b) provides in pertinent part:


(1) Issuing Without Notice. The court may issue a temporary restraining order without written or
oral notice to the adverse party or its attorney only if:

(A) specific facts in an affidavit or a verified complaint clearly show that immediate and irreparable injury, loss, or damage will result to the movant before the adverse party can be heard in opposition; and

(B) the movant’s attorney certifies in writing any efforts made to give notice and the reasons why it should not be required.

Here the Court issues the order temporarily restraining Defendants from proceeding with the proposed foreclosure sale of Plaintiff’s property without notice to Defendants because there is insufficient time before the scheduled foreclosure sale to compel Defendants to appear and to respond to the Motion. In addition, Plaintiff’s counsel has made reasonable efforts to  notify Defendants and has been unsuccessful in securing the presence of a responsive party.

Finally, the Court concludes the risk of irreparable harm to Plaintiff is significant when weighed against the temporary delay authorized by this Order.

III. Security

Pursuant to Rule 65(c), the Court requires Plaintiff to post a $500.00 bond by 4 p.m., Monday, February 14, 2011, as a reasonable security for any costs or damages sustained by any party found to have been wrongfully restrained.

CONCLUSION

For these reasons, the Court GRANTS Plaintiff’s Motion (#3) for a Temporary Restraining Order and hereby RESTRAINS Defendants from proceeding with the February 16, 2011, foreclosure sale of Plaintiff’s property. The Court DIRECTS Plaintiff to post a $500.00 bond by 4 p.m., Monday, February 14, 2011.

IT IS SO ORDERED.

DATED this 11th day of February, 2011.

This order is issued on February 11, 2011, at 5:00 p.m., and expired on February 25, 2011, at 5:00 p.m., unless extended by order of the Court.

/s/ Anna J. Brown
ANNA J. BROWN
United States District

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FDL | 10,000 GMAC Foreclosures Stopped in Maryland

FDL | 10,000 GMAC Foreclosures Stopped in Maryland


Posts by David Dayen Sunday January 16, 2011 7:00 am

In a major ruling Friday, a coalition of nonprofit defense lawyers and consumer protection advocates in Maryland successfully got over 10,000 foreclosure cases managed by GMAC Mortgage tossed out, because affidavits in the cases were signed by Jeffrey Stephan, the infamous GMAC “robo-signer” who attested to the authenticity of foreclosure documents without any knowledge about them, as well as signing other false statements.

The University of Maryland Consumer Protection Clinic and Civil Justice, Inc., a nonprofit, filed the class action lawsuit, arguing that any case using Jeffrey Stephan as a signer was illegitimate and must be dismissed. In court Friday, GMAC agreed to dismiss every case in Maryland relying on a Stephan affidavit. They can refile foreclosure actions on the close to 10,000 homes, but only at their own expense, and subject to new Maryland regulations which require mandatory mediation between borrower and lender before moving to foreclosure. Civil Justice and the Consumer Protection Clinic also want any cases with affidavits from Xee Moua of Wells Fargo, who has also admitted to robo-signing, thrown out, but that case has not yet been settled.

This was not the plan of GMAC and other banks caught using robo-signers last year. They hoped to undergo a pause in proceedings, run a quick “double-check” and then issue substitute documents in the same cases. That would have been a much more rapid solution for the banks and would have resulted in many more foreclosures. Now GMAC has to go back and basically file the entire case all over again, meaning they have to give notice of foreclosure to the borrower, engage the borrower in modification options, and basically run through the whole process from the beginning. They cannot use the shortcut solution, thanks to the class action suit filed. GMAC’s dismissal of every foreclosure in Maryland shows their doubts they would have won the class action.

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NY Judge Gives Green Light On RICO Class Action Against Law Firm in ‘Sewer Service’ Case SIKES v. MEL HARRIS & ASSOCIATES

NY Judge Gives Green Light On RICO Class Action Against Law Firm in ‘Sewer Service’ Case SIKES v. MEL HARRIS & ASSOCIATES


UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

MONIQUE SYKES et al.,
Plaintiffs,

– against –

MEL HARRIS AND ASSOCIATES, LLC,
-et al.,
Defendants

APPEARANCES: (See last page)

CHIN, Circuit Judge:

In this case, eight plaintiffs allege that a debt buying
company, a law firm, a process service company, and others
engaged in a “massive scheme to fraudulently obtain default
judgments against them and more than 100,000 other consumers in
state court. Plaintiffs allege that defendants did so by
engaging in “sewer servicer” — the practice of failing to serve a
summons and complaint and then filing a fraudulent affidavit
attesting to service. When the debtors failed to appear in court
because they did not have notice of the lawsuits, defendants
obtained default judgments against them.

Plaintiffs sue on behalf of themselves and all others
similarly situated. Their second amended complaint (the
“Complaint”) asserts claims under the Fair Debt Collection
Practices Act (the “FDCPA”)1,5 U.S.C. 5 1692 et sea., the
Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18
U.S.C. 5 1961 et sea., New York General Business Law (“GBL”) §
349, and New York Judiciary Law 5 487. Plaintiffs seek
injunctive relief, declaratory relief, and damages.
Defendants move to dismiss the Complaint pursuant to
Rules 9 (b) , 12 (b) (1) , and 12 (b) (6) of the Federal Rules of Civil
Procedure, challenging the sufficiency of every claim and the
subject matter jurisdiction of this Court. For the reasons that
follow, the motions to dismiss are denied in part and granted in
part.

Continue below to the decision…

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Posted in STOP FORECLOSURE FRAUDComments (1)

IA APPEALS COURT |”MORTGAGE NULL & VOID” DEUTSCHE BANK NATIONAL TRUST COMPANY v. GAUPPS

IA APPEALS COURT |”MORTGAGE NULL & VOID” DEUTSCHE BANK NATIONAL TRUST COMPANY v. GAUPPS


Back by popular demand…first posted this back on July 1, 2010.

DEUTSCHE BANK NATIONAL TRUST COMPANY, As Trustee of Ameriquest Mortgage Securities, Inc., Asset-Backed Pass Through Certificates, Series 2004-X3, Under the Pooling and Servicing Agreement Dated as of September 1, 2004, Without Recourse, Plaintiff-Appellant,
v.
DAVID J. GAUPP, ALEXANDRA C. GAUPP, NATHAN PARTON and SPOUSE OF NATHAN PARTON, REBEKAH J. BARTON and SPOUSE OF REBEKAH J. BARTON, WELLS FARGO BANK, N.A., and PARTIES IN POSSESSION,, Defendants-Appellees.

No. 0-272/09-0700.

Court of Appeals of Iowa.

Filed June 30, 2010.

Excerpt:

On October 21, 2008, the Partons and Wells Fargo filed a motion for summary judgment asserting that (1) the mortgage held by Deutsche Bank was invalid; and (2) the mortgage held by Deutsche Bank could not be foreclosed because the Partons were bona fide purchasers for value. On February 12, 2009, the district court issued its ruling finding that the Gaupps and Granger conveyed their interest in the property to G & G Properties on July 3, 2002, and when G & G Properties recorded the deed on September 24, 2002, it became the record titleholder. Gaupp did not have any interest in the property when he executed the mortgage in favor of Ameriquest/Deutsche Bank and after the mortgage was executed, Gaupp never obtained title to the property. G & G Properties did not convey the property to anyone prior to May 19, 2006, when the Partons purchased the property. As a result, the mortgage held by Deutsche Bank was “null and void.” The district court granted the Partons and Wells Fargo’s motion for summary judgment and dismissed the petition for foreclosure. Deutsche Bank appeals.

<SNIP>

Deutsche Bank asserts that the district court erred in granting the defendants’ motion for summary judgment. The parties do not dispute that at the time Gaupp executed the promissory note and mortgage, he did not hold title to the property and that G & G Properties was the record titleholder. Deutsche Bank cannot avoid the fundamental principal that a party that has no interest in a particular piece of real property cannot validly mortgage that property. See, e.g., Lee v. Lee, 207 Iowa 882, 885, 223 N.W. 888, 890 (Iowa 1929) (holding a mortgage invalid because the mortgagor had no interest in the property at the time the mortgage was given); 59 C.J.S. Mortgages § 111, at 102-03 (2009) (discussing that “[o]ne who has no ownership interest in property has no right to mortgage it” and if one does so, the mortgage creates no interest in the property). At the time Gaupp obtained the loan from Ameriquest, he did not have any interest in the property and therefore, the mortgage instrument attempting to secure the promissory note was invalid.

Deutsche Bank argues that Gaupp acquired title to the property on December 31, 2003, when the Gaupps and Granger executed the “Corrected Warranty Deed,” which Deutsche Bank further argues resulted in the mortgage becoming valid.[ 3 ] However, this argument fails because Gaupp did not acquire an interest in the property when the “Corrected Warranty Deed” was executed on December 31, 2003. On July 3, 2002, the Gaupps and Granger conveyed the property to G & G Properties. After this conveyance, Gaupp had no interest in the property and could not convey the property to anyone. See Iowa Code § 557.3 (2007) (“Every conveyance of real estate passes all the interest of the grantor therein, unless a contrary intent can be reasonably inferred from the terms used.”). After the July 3, 2002 conveyance, only G & G Properties was able to convey title to the property. Any such attempt by Gaupp to do so would be and was invalid as he was no longer the titleholder. Therefore, the attempts by the Gaupps and Granger to convey the property on December 31, 2003, and February 2, 2005, were not valid conveyances.[ 4 ] Additionally, because the invalid conveyances were outside the chain of title, they were stray deeds when recorded. See William Stoebuck and Dale Whitman, The Law of Property § 11.11 (3rd ed. 2000) (“The term `chain of title’ is a shorthand way of describing the collection of documents which one can find by the use of the ordinary techniques of title search.”); 1 C.J.S. Abstracts of Title § 15, at 320 n.8 (2009) (“Instrument executed by owner [that] is recorded before acquisition or after relinquishment of title by owner is outside chain of title . . . .”).[ 5 ] Title remained with G & G Properties from July 3, 2002 until May 5, 2006, when G & G Properties conveyed its solely held interest in the property to the Partons. Therefore the chain of title went from G & G Properties to the Partons. Gaupp did not have title to the property when he executed the mortgage instrument now held by Deutsche Bank nor did he subsequently obtain title. We affirm the district court’s findings and ruling.

Continue reading below…

deutsche bank v. gaupp

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WASHINGTON STATE: QUIET TITLE & DAMAGES VICTORY

WASHINGTON STATE: QUIET TITLE & DAMAGES VICTORY


Excerpt:

The Court quiets title in favor of the plaintiff and against Diversified U.S. Holdings of Washington, LLC, Diversified Financial, Inc. and Northwest Commercial Bank […]

<SNIP>

JUDGMENT

Based upon the findings and conclusions , Plaintiff is granted a net JUDGMENT for $110, 923, plus interest thereonof judgment at the rate of the loan documents of 18.9%. from the date

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Posted in STOP FORECLOSURE FRAUDComments (2)

EXCLUSIVE | NYSC COMMERCIAL (CMBS), MERS and a $65 MILLION NOTE

EXCLUSIVE | NYSC COMMERCIAL (CMBS), MERS and a $65 MILLION NOTE


Recently many blogs have been discussing MERS and CMBS, well here is an example of one case from a NY Supreme Court. You can read it and draw your own conclusions by commenting down below if you wish.

Be sure you catch Judge IRA B. WARSHAWSKY’s valid points!

SUPREME COURT : STATE OF NEW YORK
COUNTY OF NASSAU

MASS OP LLC and MASS ONE LLC

against

PRINCIPAL LIFE INSURANCE COMPANY
PRINCIPAL GLOBAL INVESTORS, LLC,
WELLS FARGO BANK, N.A., CENTERLINE
CAPITAL GROUP, INC., BANK OF AMERICA
NATIONAL ASSOCIATION, Successor by
Merger to LASALLE BANK NATIONAL
ASSOCIATION, as TRUSTEE for the Registered
Holders of Bear Stearns Commercial Mortgage
Securities, Inc. Commercial Mortgage Pass-
Through Certificates Series 2006-PWR14

Excerpts:

The application stated that the lender intended to ” securitize” the loan and the borrower was to “cooperate in connection with any such securitization.” The application recited that each borrower was a “single purpose bankruptcy-remote entity…formed exclusively for the purpose of owning and operating the property.” The application stated that the loan amount would be not less than $65 million provided, among other conditions, that the loan amount would be equal to 80% of the appraised value of the property “pursuant to an appraisal approved by lender. “

However, the court hastens to add that it is not insensitive to plaintiffs ‘ predicament. Traditionally, mortgage assignments were recorded with the County Clerk. By searching the mortgage records, the mortgagor could determine the present mortgage holder and attempt to negotiate a “work out” or forbearance. In 1993, several large participants in the mortgage industry created the Mortgage Electronic Registration System (“MERS”). Pursuant to MERS, assignments of residential mortgages, instead of being publicly recorded, are tracked electronically in a private system (See MERSCORP, Inc. Romaine 8 NY3d 90 (2006)). By visiting MERS’ website or dialing its 800 number , a homeowner may access information regarding his or her loan servicer, but not the holder of the mortgage.

This lack of disclosure may create substantial difficulty when a homeowner wishes to negotiate the terms of his or her mortgage or enforce a legal right against the mortgagee and is unable to learn the mortgagee s identity (See 8 NY3d at 104, Kaye, J. dissenting). This

“information deficit” may function to “insulate a note holder from liability… and hide predatory lending practices”

(Id). The MERS system applies only to residential mortgages. However, as the present case illustrates , securitized financing creates the potential for the same abuses with commercial mortgages because of a similar “information deficit. ” While a breach of contract action against the lender does not lie, this court echoes Judge Kaye in calling the issue to the attention of the Legislature (ld). The court will now proceed to determine the sufficiency of plaintiffs ‘ fraud claims.

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Just recently:

2010 NY Slip Op 51791(U)

MASS OP LLC AND MASS ONE LLC, Plaintiffs,
v.
PRINCIPAL LIFE INSURANCE COMPANY, PRINCIPAL LIFE GLOBAL INVESTORS, LLC, WELLS FARGO BANK, N.A., CENTERLINE SERVICING, INC., BANK OF AMERICA NATIONAL ASSOCIATION, SUCCESSOR BY MERGER TO LA SALLE BANK NATIONAL ASSOCIATION, AS TRUSTEE FOR THE REGISTERED HOLDERS OF BEAR STEARNS COMMERCIAL MORTGAGE SECURITIES, INC. COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES SERIES 2006-PWR14, BEAR STEARNS COMMERCIAL MORTGAGE SECURITIES INC., AND “JOHN DOE” NO. 1 THROUGH “JOHN DOE” #7 INCLUSIVE, THE ACTUAL IDENTITIES OF THE LAST NAMED, defendants BEING UNKNOWN TO Plaintiffs, THE PARTIES INTENDED BEING PERSONS, CORPORATIONS, ASSOCIATIONS AND OTHER ENTITIES HAVING OR CLAIMING AN INTEREST IN THE LOAN DESCRIBED IN THIS COMPLAINT, Defendants.

Supreme Court, Nassau County.

Decided September 30, 2010.

IRA B. WARSHAWSKY, J.

PRELIMINARY STATEMENT

Defendants Bear Stearns and Principal Life Insurance move to dismiss the amended complaint. Bear Stearns, which first appears as a defendant in the amended complaint, assert that by entering into a settlement agreement with certain defendants, and have thereby reaffirmed the valuation of the shopping center and have recovered damages, bars them from further claims under the “one recovery” doctrine. They also claim that the breach of fiduciary duty claim against Bear Stearns is barred by the 3-year statute of limitations, which commenced with the refinancing on November 8, 2006, with service upon Bear Stearns on December 24, 2009. Bear Stearns also contends that the plaintiff has failed to allege a “relationship of higher trust”, essential to a claimed breach of a fiduciary duty; that the claim which plaintiff asserts against Bear Stearns is barred by the Martin Act; and, to the extent a claim of “joint venture” with Bear Stearns is asserted, recovery is also barred under the “one recovery” doctrine.

In similar fashion, Principal Life contends that plaintiffs’ settlement with the servicer defendants renders the amended complaint moot; there was no fiduciary relationship between plaintiffs and Principal Life; the Pooling and Servicing Agreement did not establish a joint venture; and plaintiffs have failed to state a claim for breach of a fiduciary duty.

BACKGROUND

This action arises from the refinancing of the Phillips at Sunrise Mall in Massapequa. Plaintiff, the owner of the mall, sought to borrow $65,000,000 from Principal Life to refinance the existing $40,000,000 mortgage on the mall. Plaintiff contends that prior to the November 8, 2006 refinancing transaction, Principal Life represented that the $65,000,000 represented no more than 80% of the value of the real estate. They claim that this was erroneous, based upon a defective appraisal performed by Cushman & Wakefield, allegedly based upon faulty data. Plaintiff claims to have expressed concern about repaying the loan, but were advised that Principal Life’s servicing entity, Principal Global Investors, LLC would be responsive to the needs of plaintiff.

After the closing, Principal Life assigned the loan to Principal Commercial Funding, LLC, which then sold the loan to Bear Stearns as the “depositor” for a commercial mortgage-backed securities trust (“CMBT”). Plaintiff contended in part that the failure of Principal Life Insurance to divulge its fee arrangement with Bear Stearns, which encouraged them to inflate the amount of the mortgage, breached a duty to plaintiff. The mortgage was deposited along with many other mortgages in the securitization process. Through underwriters, commercial mortgage certificates were sold in the open market.

By December 2008, in the midst of a global economic crisis, plaintiffs had lost two major tenants, and were experiencing difficulty in making payments under the mortgage. Their efforts to modify the mortgage with Principal Global were not successful, and they were advised to contact Wells Fargo Bank, N.A., the “master servicer”. Plaintiffs contend that they were unable to make headway in such discussions with any servicer.

Plaintiffs commenced the original action on March 11, 2009, suing the maker and seller of the loan, the servicers and trustee for their roles in originating and servicing the loan. They did not sue Bear Stearns or any underwriters or other entities involved in bringing the commercial mortgage certificates to market. The complaint was dismissed by Order dated July 1, 2009, but the dismissal was without prejudice to plaintiffs’ seeking to replead to allege a breach of fiduciary duty.

Plaintiffs did so move on September 16, 2009, seeking to add Bear Stearns as a defendant. Defendant Bear Stearns notes that the moving papers included a copy of the proposed amended complaint, but not a summons, and that this is a significant factor in the claimed expiration of the statute of limitations. By Order of December 14, 2009, the Court granted plaintiffs’ motion in part and denied it in part. Plaintiff was permitted to allege a first cause of action in the Amended Complaint claiming a breach of fiduciary duty claim against Principal Life and Bear Stearns, and also permitted the assertion of a similar claim against Wells Fargo and Centerline Servicing, Inc. and Bank of America N.A. under a joint venture theory in the second cause of action. Plaintiff was also permitted to replead a cause of action against Principal Life.

On December 24, 2009 plaintiff made service of the Amended Complaint and Supplemental Summons upon Bear Stearns by service on the New York Secretary of State. By letter dated April 29, 2010 from June Diamant, Esq., Bear Stearns learned that plaintiff reached a settlement with defendants Centerline, Bank of America, Wells Fargo and Principal Global. While Bear Stearns has not seen the settlement agreement, a reading of the letter indicates that there has been no reduction in the principal amount of the loan, but interest is being deferred for some period of time.

Principal Life’s motion asserts that the only claim surviving against them after the Decision and Order of the Court and the settlement with Wells Fargo Bank, N.A. as “master servicer”, Centerline Servicing, Inc. as “special servicer”, Bank of America, N.A., and Principal Global Investors, LLC, are an alleged breach of fiduciary duty based upon its failure to reveal its compensation arrangement with Bear Stearns, and a second cause of action on the theory of a joint venture and breach of a fiduciary duty thereunder.

The Amended Complaint

The complaint alleges Five Causes of Action as follows:

First: Principal assigned an appraised value which would be relied upon by plaintiff to determine the amount of debt which they could safely assume. Principal and Bear Stearns, possessing superior knowledge and expertise than plaintiff in originating loans and issuing debt, placed the loan in a securitized pool. The undisclosed compensation agreements between Principal and Bear Stearns incentivized Principal to originate the loan and Bear Stearns to deposit it into the CMBS trust. The failure of Principal and Bear Stearns to advise plaintiff of the fee arrangement constituted a breach of fiduciary duty.

Second: Wells Fargo, Bank America and Centerline, as trustees and servicers of the loan, acted as joint venturers with Principal and Bear Stearns. In this capacity they owed a fiduciary duty to plaintiffs, which they breached.

Third: Principal failed to disclose the methodology by which it valued the property at an inflated price so as to benefit from undisclosed compensation agreements with Bear Stearns. Had plaintiffs been aware of the profit motive which caused Principal to misrepresent the value of the property, they would not have committed to the mortgage. Plaintiff seeks a reformation of the Loan by reducing the principal to 80% of the fair market value and a prohibition against defendants or other owner of the loan from declaring plaintiffs in default.

Fourth: In order to induce plaintiff to agree to the loan Principal made fraudulent misrepresentations of a material fact, that is, that the servicers would be responsive to plaintiff at a time when Principal knew that the loan would be transferred to others who would refuse to communicate with plaintiff, and whose preference was to have the loan go into default rather than resolve issues so as to maintain it as a performing loan.

Fifth: Despite the provision in the mortgage that communications to the lender were to be directed to Principal, neither Principal nor any other defendant notified plaintiff that the contact had been changed, resulting in a lack of communication from Principal in response to contacts from plaintiff. Principal’s servicing arm, Global, advised that communications must be directed to the Master Servicer, yet neither the Master Servicer nor any of the other defendants were willing to respond or carry out the obligations of the lender/mortgagee, although holding the powers of the mortgagee. Defendants thereby breached their obligations under the Mortgage Agreement and Loan Documents by failing to exercise the discretion granted in the Mortgage Agreement in a reasonable manner.

Plaintiffs demand damages of $28,000,000 on the First, Second, Fourth and Fifth Causes of Action, and reformation of the Mortgage in the Third Cause of Action.Plaintiffs oppose the motions of Bear Stearns and Principal, in part asserting that by virtue of the prior Order of the Court, after review of the proposed amended complaint, the Court directed an answer as opposed to a further motion to dismiss. They also contend that the prior settlement with servicer-defendants does not render the matter moot, that the claims against Bear Stearns are not time-barred, that the breach of fiduciary duty claim is sufficiently pleaded, the information that the moving defendants failed to disclose is material, that the action is not barred by the Martin Act, and that the breach of fiduciary claim is adequately pleaded against Bear Stearns on the theory of joint venture liability. Plaintiff asserts the same claims with respect to defendant Principal.

DISCUSSION

Defendants Principal and Bear Stearns move for dismiss pursuant to Civil Practice Law and Rules §§ 3211 (a)(1) and 3211 (a)(7).

CPLR § 3211 (a)(1) provides as follows:

(a) Motion to dismiss cause of action. A party may move for judgment dismissing one or more causes of action asserted against him on the ground that: 1. a defense is founded upon documentary evidence;

In order to succeed in a claim based upon documentary evidence, “. . . the defendant must establish that the documentary evidence which forms the basis of the defense be such that it resolves all factual issues as a matter of law and conclusively disposes of the plaintiff’s claim”. (Symbol Technologies, Inc. v. Deloitte & Touche, LLP, 69 AD3d 191, 194 [2d Dept. 2009]); (DiGiacomo v. Levine, 2010 WL 3583424 (N.Y.AD2d Dept.]).

When determining a motion to dismiss for failure to state cause of action pursuant to Civil Practice Law and Rules § 3211 (a)(7), the pleadings must be afforded a liberal construction, facts as alleged in the complaint are accepted as true, and the plaintiff is accorded the benefit of every favorable inference, and the court must determine only whether the facts as alleged fit within any cognizable legal theory. (Uzzle v. Nunzie Court Homeowners Ass’,. Inc. 55 AD3d 723[2d Dept. 2008]). A pleading will not be dismissed for insufficiency merely because it is inartistically drawn; rather, such pleading is deemed to allege whatever can be implied from its statements by fair and reasonable intendment; the question is whether the requisite allegations of any valid cause of action cognizable by the state courts can be fairly gathered from all the averments. (Brinkley v. Casablancas, 80 AD2d 815 [1st Dept. 1981]).

Defendants contention with respect to § 3211 (a)(1) is, in part, that the settlement agreement with servicing defendants belies the claims that the appraised value was inflated, or the interest rate too high. Aside from the fact that the Court has not seen the settlement agreement, defendants argument presumes that plaintiffs had the opportunity to reduce the principal balance or interest rate in conjunction with their settlement negotiations, and that their failure to do so is an acknowledgment on their part that the loan was not based upon an inflated appraisal and that the interest rate was appropriate. Instead, the settlement merely provided for a deferral of interest payments for some period of time in an effort to allow plaintiff to recover from the loss of two anchor tenants.

The Mortgage Consolidation, Extension and Modification Agreement between Mass Op, LLC and Mass One, LLC, as borrower, and Principal Life Insurance as lender, provides at ¶ 6.1 as follows:

The relationship between Borrower and Lender is solely that of debtor and creditor, and Lender has no fiduciary or other special relationship with Borrower and no term or condition of any of the Note, this Security Instrument and the other Loan Documents shall be construed so as to deem the relationship between Borrower and Lender to be other than that of debtor and creditor. Borrower is not relying on Lender’s expertise, business acumen or advice in connection with the Property”.

This is documentary evidence which clearly refutes any claim that plaintiff relied upon the expertise of Principal and was thereby in a relationship which required a higher level of trust than that between debtor and creditor. New York Courts have been reluctant to find a fiduciary relationship between lenders and borrowers, and the language of the security agreement simply amplifies this position. (Dobroshi v. Bank of America, N.A., 65 AD3d 882, 884 [1st Dept.2009]). There have been relatively rare circumstances in which a fiduciary relationship between a lender and a borrower has been found, but these inevitably involved certain unique circumstances, as when the Court concluded that the underlying motivation for a lender was to drive the borrower out of business. (In re Monahan Ford Corp. of Flushing, 340 B.R. 1 [Bankr. E.D.NY 2006]).

In the absence of such special circumstances, plaintiff did not have a fiduciary relationship with Principal. Principal’s motion to dismiss the First Cause of Action for Breach of Fiduciary Duty is granted.

The motion by Bear Stearns to dismiss is also granted as to the First Cause of Action. Plaintiff has no contractual relationship with Bear Stearns, and certainly no fiduciary responsibility on the part of Bear Stearns to advise plaintiff of its financial arrangement with Principal.

The Second Cause of Action is directed as the servicing defendants, claiming that they were joint venturers with Principal and Bear Stearns in that they divided responsibilities and compensation with respect to the loan, all without the knowledge of plaintiff. As such joint venturers, they all owed a fiduciary responsibility to plaintiff. As noted, however, neither Principal or Bear Stearns were in a fiduciary relationship with plaintiff, and, even if the subsequent servicing defendants were part of a joint venture, they did not assume a fiduciary responsibility from their assignors, who had none.

The Second Cause of Action is dismissed for failure to state a cause of action.

The Third Cause of Action seeks a reformation of the loan agreement based upon Principal’s failure to reveal to plaintiff the methodology by which the value of $82,000,000 was arrived at or its financial arrangement with Bear Stearns. In the absence of a fiduciary relationship, Principal had no obligation to reveal the methodology by which it estimated the value of the property; nor was it obligated to reveal its financial arrangement with Bear Stearns.

In fact, plaintiffs seem to have been fully apprised of the Cushman Wakefield appraisal, which is what formed the basis for Principal’s determination that the loan did not exceed 80% of the value of the property. The proposed terms of loan, described as an “application”, made it clear that the loan amount represented 80% of the appraised value pursuant to an appraisal approved by the Lender. Principal’s motion to dismiss the Third Cause of Action is granted.

The Fourth Cause of Action alleges fraud and fraudulent misrepresentation against Principal. In order to sustain a cause of action for actual fraud, plaintiff must prove:

• defendant made a representation, as to a material fact;

• the representation was false;

• the representation was known to be false by defendant;

• it was made to induce the other party to rely upon it;

• the other party rightfully relied upon the representation;

• the party relying upon the representation was ignorant of its falsity;

• the party suffered injury or damage based on its reliance. (Otto Roth & Co. Inc., v. Gourmet Pasta, Inc. 277 AD2d 293 [2d Dept. 2000]).

The Fourth Cause of Action in the Amended Complaint adds nothing to the claim of fraud which was previously dismissed. This is the law of the case, and the motion by Principal to dismiss the Fourth Cause of Action is granted.

In its earlier decision the Court determined that representations with respect to the servicer being “extraordinarily accessible in servicing the loan”, made to sophisticated investors, was a matter of puffery, not a representation of a material fact upon which plaintiffs were entitled to rely.

The Fifth Cause of Action alleges a breach of contract in that Principal is identified as the party to be contacted by mortgagor with respect to the mortgage; but after the securitization, neither Principal nor any other defendant advised Principal of the identity of the party with whom to make contact with respect to the mortgage. If there is any obligation on the part of Principal to advise the mortgagor of the identity of a special or master servicer, it would have to be contained in the only agreements between them, the Consolidation, Modification and Extension Agreement of November 8, 2006, and the Note and Mortgage executed in conformity with the Agreement.

The Consolidation Agreement is silent on the subject. The note in the amount of $65,000,000 calls for the payment to the order of Principal Life Insurance Company, at 711 High Street, Des Moines, Iowa 50392 (“Lender”) or at such other place as the holder hereof may from time to time designate, in writing, . . .”. This gives the lender the right to direct payment to the order of another, or to a different location, but places no obligation upon it to do so. To the contrary, ¶ 12 of the Promissory Note, Exh. “G” to the Affirmation of Joshua A. Zielinski, provides as follows:

(a) Upon the transfer of this Note, Borrower hereby waiving notice of any such transfer, Lender may deliver all the collateral mortgaged, granted, pledged or assigned pursuant to the Security Instrument and the other Loan Documents, or any part thereof, to the transferee who shall thereupon become vested with all the rights herein or under applicable law given to Lender with respect thereto, and Lender shall thereafter forever be relieved and fully discharged from any liability or responsibility in the matter accruing after said transfer; but Lender shall retain all rights hereby given to it with respect to any liabilities and the collateral not so transferred.

Lender, Principal Life, transferred the Note, notice of which Borrower (plaintiffs) waived, and upon such transfer of the Note and collateral, Lender was absolved from all further liability in the matter. (Exh. “K” to Affirmation of Joshua A. Zielinski).

The Fifth Cause of Action, as set forth in the Amended Complaint, is dismissed.

In light of the foregoing determinations as to each of the causes of action, the Court finds it unnecessary to address the claims of Bear Stearns that the failure of the plaintiff to annex a Supplemental Summons to their motion to amend the complaint caused service to be beyond the three year statute of limitations, that the claim is barred by the Martin Act, and that recovery is barred by the “one recovery” doctrine.

This constitutes the Decision and Order of the Court.

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Posted in STOP FORECLOSURE FRAUDComments (1)

OHIO WOMAN SUES BANK OF AMERICA, ROBO SIGNER, FANNIE MAE, AG CORDRAY

OHIO WOMAN SUES BANK OF AMERICA, ROBO SIGNER, FANNIE MAE, AG CORDRAY


This may be the first lawsuit from an individual homeowner seeking to undo a completed foreclosure.

I am sure these are lining up as I type…

Keep your eye on Harmon Law Offices, P.C. in Newton Highlands, MA 02461 aka Mark P. Harmon who serves as a director of Law offices of David J. Stern’s “DJSP Enterprises Inc.”

Enjoy!

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Posted in STOP FORECLOSURE FRAUDComments (5)

REVERSED AND REMANDED: BALOUN v. CITIMORTGAGE, INC., Fla: Dist. Court of Appeals, 5th Dist. 2010

REVERSED AND REMANDED: BALOUN v. CITIMORTGAGE, INC., Fla: Dist. Court of Appeals, 5th Dist. 2010


FRANCIS R. BALOUN and ANTOINETTE M. BALOUN, Appellant(s),
v.
CITIMORTGAGE, INC., etc., Appellee(s).

Case No. 5D09-2793.

District Court of Appeal of Florida, Fifth District.

Opinion filed October 15, 2010

Michael E. Rodriguez, of Foreclosure Defense Law Firm, PL, Tampa, for Appellants.

Forrest G. McSurdy, of Stern & McSurdy, Law Offices of David J. Stern, P.A., Plantation, for Appellees.

ON CONCESSION OF ERROR

PER CURIAM.

Pursuant to the Appellees’ concession of error, the order granting summary final judgment in foreclosure is reversed and this cause is remanded for further proceedings.

REVERSED and REMANDED.

LAWSON, EVANDER and COHEN JJ., concur.

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MBA Testifies on Potential Revisions to The Home Mortgage Disclosure Act (HMDA)

MBA Testifies on Potential Revisions to The Home Mortgage Disclosure Act (HMDA)


WASHINGTON, D.C. (September 24, 2010) – Jay Brinkmann, Chief Economist and Senior Vice President of Research and Economics for the Mortgage Bankers Association (MBA), testified today before the Federal Reserve Board of Governors at a hearing entitled, “Potential Revisions to Regulation C – Implementing the Home Mortgage Disclosure Act (HMDA).”

Below is Mr. Brinkmann’s oral statement before the committee, as prepared for delivery.

“My name is Jay Brinkmann and I am the Chief Economist and head of research at the Mortgage Bankers Association (MBA). I very much appreciate the opportunity to participate in today’s hearing of the Federal Reserve Board on potential revisions to its Home Mortgage Disclosure Act (HMDA) requirements.

I would like to address essentially five questions or areas that need to be addressed. First, what data should be required? Second, how should the data be reported? Third, what should be used as the universal mortgage identifier? Fourth, what data should be made public? Finally, I will address some issues regarding multifamily data.

What data should be required?

Dodd-Frank already requires a significant expansion of the required data elements, although some are left to the discretion of the Bureau of Consumer Financial Protection (CFPB). In addition, we understand the Federal Reserve is looking at some potential additions beyond what is in Dodd-Frank. We have no objection to an expansion of the HMDA data elements as long as that expansion is consistent with the stated purposes of HMDA, the elements are consistent with what is already collected, and the changes would not pose unnecessary burdens on lenders. It should be understood, however, that no matter how many additional data elements are required they will not serve as a reliable proxy for the range of credit models or credit decisions given the sequential nature of the credit decision, variations in decision-making processes among lenders, as well as variations in shopping behavior and self-selection of credit terms by borrowers.

One issue the Fed must keep in mind in determining what data elements to collect is that HMDA requirements should not turn into a safe harbor of allowable credit variables to be considered when making a loan. Freezing credit models into an official sanctioned set of variables would have a deleterious impact on credit availability going forward, limiting the growth of lenders who believe they have a better idea of how to do things. For example, over the years some lenders have come to believe that credit scores are not as important as the number of times a potential borrower has been late with housing-related payments. Some lenders now will simply refuse to make a loan to a borrower who has walked away from a previous mortgage, or appears to be positioning himself or herself for such behavior. None of these considerations are captured in any of the proposed HMDA data elements, nor should they be.

How to report?

In determining definitions and file formats for potential data items, the Fed should use the standard and uniform definitions developed over the last ten years by the Mortgage Industry Standards and Maintenance Organization, Inc. (MISMO®). Reliance on MISMO definitions would greatly reduce the regulatory compliance burden by allowing lenders and vendors furnishing HMDA compliance services to pull from existing MISMO-compliant databases to report under HMDA. This would reduce the errors associated with entering data a second time for HMDA purposes and reduce the phase-in period for trying to interpret and then implementing new HMDA definitions. In addition, MISMO standards have already been adopted by Fannie Mae and Freddie Mac.

Reliance on the MISMO dictionary and standards would also help deal with the ambiguity surrounding some of the data elements specified in Dodd-Frank. For example, Dodd-Frank requires that credit scores be reported. MISMO recognizes that there is no such thing as a single credit score, so while it has a field for the score, it also has a field for the credit score vendor (such as Vantage Score or FICO), and the reporting agency. Rather than asking lenders to map multiple fields into a single number to be reported to the Fed, a number that likely would not appear in any credit file nor be used in the credit or loan pricing decision, the Fed could simply ask for the multiple fields dealing with credit scores and do its own mapping depending on whether it is doing a company-level or industry-level analysis.

I cannot stress enough the extent of the regulatory burden that HMDA and other reporting and compliance requirements place on the industry. The largest shares of investments in technology today are going to reporting and compliance needs, with no direct benefit to the companies or their customers. I would hope that the Fed would keep this burden and its costs in mind and minimize future changes in HMDA once these changes are made. Relying on MISMO would not only minimize costs but it would allow minor tweaking of data requirements in the future with less burden.

What to use as the universal mortgage identifier?

The industry already has a uniform mortgage identification number that is issued through the Mortgage Electronic Registration Systems, Inc. (MERS). This MERS number is used by a very high percentage of lenders and is integral to numerous origination and secondary market functions. It would cause considerable confusion and unnecessary implementation expense to impose a new mortgage identification protocol on the industry. Reliance on the MERS Mortgage Identification Number (MIN) allows loans to be tracked from origination through sale in the secondary market and subsequent servicing, and is valuable in identifying and preventing mortgage fraud.

For the Fed’s purposes, a further advantage of using the MERS MIN is that it would help prevent double counting or the failure to count loans altogether. For example, the current practice of eliminating loans purchased as closed loans from correspondent banks lowers the apparent coverage level of HMDA. In an effort to see what was missing from HMDA, the MBA several years ago did a matched-pair analysis of correspondent loans and found that a large percentage did not have a matching loan in the retail/broker data. Use of the MERS MIN would largely solve the problem of estimating coverage levels because it would permit an explicit matching between retail/broker originations and correspondent originations, it would provide a matching of loans originated in one calendar year and sold in another, and it allow loan data to be double checked against other data sources like Fannie Mae, Freddie Mac and Ginnie Mae.

What to make public?

Federal Reserve staff have developed considerable expertise in the analysis and interpretation of HMDA data. Their annual article in the Federal Reserve Bulletin is the source of information on HMDA for most analysts. In recent years, Fed staff have gone the extra mile to conduct analyses beyond the HMDA data to answer topical policy questions.

However, while it is proper and customary for a firm’s regulator to have access to confidential data, care needs to taken before those data are made public. While we see tremendous risk of widespread identity theft if all of the HMDA data elements were to be released in their collected form, particularly when those data are combined with other publicly available data, under Dodd-Frank, decisions on such release now lie with the Board and later the CFPB. The lending industry has poured tremendous resources into safeguarding the private information of our customers, and we have paid large fines for lapses. No doubt we would face the potential of additional fines and public recrimination were we to make the proposed HMDA data elements available to the public at large. That is why any liability associated with the collection and release of these data pursuant to Board rules should lie with the Fed. Moreover, the Board should provide guidance on how lenders should deal with requests that come directly to them for these data.

To a certain degree, we would support a greater release of credit data in some form. While it still would not solve all of the statistical problems associated with trying to mimic credit models with these data, it would go a long way to putting to rest once and for all charges of racism that have been hurled at the industry by various groups over the years that have no basis in fact. The econometric problems of omitted variables, multicolinearity and spurious correlation would still remain, but sufficient data would be available in the public domain to refute most of these charges.

What multifamily data should be reported?

MBA estimates that the 2008 HMDA data contained information on 95 percent of the multifamily loans made that year based on the number of loans, but covered only about 61 percent of their dollar amount. The average multifamily loan in HMDA was about $1.7 million while the average missing loan was about $18.9 million. We question the benefit of expanding the reporting requirements to include a relative small number of high-dollar multifamily projects.

Clearly, the data elements associated with single-family lending are not applicable to any but the smallest multifamily projects. Variables like race and credit score do not apply to limited partnerships, corporations or real estate investment trusts. We suggest that the Fed should examine the usefulness of the multifamily data it collects now with an eye to scaling back the requirement rather than going to large lengths to expand the reporting requirements to cover a small number of large dollar projects.

In conclusion, in making changes to the required data elements of HMDA, the Fed should look carefully at what is needed considering the new data requirements under Dodd-Frank and their costs, integrating the data requirements with what is already being collected, and using data definitions and identifiers that are already in common use. In addition, the Fed should be very concerned with the privacy related issues that would attend a wholesale public release of the new required data elements.”

###

The Mortgage Bankers Association (MBA) is the national association representing the real estate finance industry, an industry that employs more than 280,000 people in virtually every community in the country. Headquartered in Washington, D.C., the association works to ensure the continued strength of the nation’s residential and commercial real estate markets; to expand homeownership and extend access to affordable housing to all Americans. MBA promotes fair and ethical lending practices and fosters professional excellence among real estate finance employees through a wide range of educational programs and a variety of publications. Its membership of over 2,200 companies includes all elements of real estate finance: mortgage companies, mortgage brokers, commercial banks, thrifts, Wall Street conduits, life insurance companies and others in the mortgage lending field. For additional information, visit MBA’s Web site: www.mortgagebankers.org.

© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in STOP FORECLOSURE FRAUDComments (1)

Buffalo Foreclosure Law Firm Faces Suit

Buffalo Foreclosure Law Firm Faces Suit


“This is the biggest fraud in history, and it’s being done by the attorneys. The banks wouldn’t be able to do it without the attorneys,” said attorney Susan Chana Lask. “These attorneys are not acting like attorneys.”

By Jonathan D. Epstein, The Buffalo News, N.Y.

Updated: October 17, 2010, 6:57 AM

As a national crisis builds over allegations of foreclosure fraud, and New York joins other states in a multistate investigation and in calls for a freeze on home seizures, Buffalo’s biggest foreclosure law firm is drawing complaints for its own practices.

A New York City attorney representing two downstate homeowners has filed a lawsuit against Steven J. Baum PC, calling the law firm a “foreclosure mill” that engages in “sloppy, irresponsible” work as part of a mortgage industry conspiracy to bilk homeowners.

The suit accuses Baum of knowingly and fraudulently filing foreclosures, paperwork and false notarizations statewide on behalf of lenders that don’t hold the actual mortgages, including HSBC Bank USA and its mortgage subsidiary.

Instead, the lawsuit says, the firm faked foreclosure and other documents when necessary, in order to preserve about $200 million a year in “reliable” income. And it accuses the firm of racketeering, fraud, deceit, unjust enrichment and violations of federal mortgage and debt collection laws.

Finally, the suit, which is filing for class-action status, seeks restitution for tens of thousands of former homeowners and punitive damages worth hundreds of millions of dollars, as well as a restraining order. The case is still pending, and has not been granted class-action status.

“This is the biggest fraud in history, and it’s being done by the attorneys. The banks wouldn’t be able to do it without the attorneys,” said attorney Susan Chana Lask. “These attorneys are not acting like attorneys.”

The Baum firm issued a brief comment.

“Because of confidentiality reasons, we cannot comment on this specific matter,” the firm said in a statement. “However, we follow the rules and regulations regarding the various pro-cesses involved in a foreclosure proceeding and take the utmost care in doing so.”

Continue reading…BUFFALO NEWS

© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in assignment of mortgage, Law Office Of Steven J. Baum, STOP FORECLOSURE FRAUD, Susan Chana LaskComments (2)

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

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


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

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

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

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

“A Subtle Stranger” Orchestrates a Paradigm Shift

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

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

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

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

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

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

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

RELATED ARTICLE:

_____________________________

MERS 101

_____________________________

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

_____________________________

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

_____________________________

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

© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in bac home loans, bank of america, bank of new york, chain in title, concealment, conflict of interest, conspiracy, CONTROL FRAUD, corruption, countrywide, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, insider, investigation, lawsuit, MERS, MERSCORP, mortgage, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., note, originator, R.K. Arnold, racketeering, Real Estate, sanctioned, scam, securitization, servicers, stopforeclosurefraud.com, sub-prime, TAXES, trustee, trustee sale, Trusts, truth in lending act, unemployed, Violations, Wall StreetComments (4)

David J. Stern Contempt of Court Petition and Affidavits 8/24/2010

David J. Stern Contempt of Court Petition and Affidavits 8/24/2010


Via: ForeclosureHamlet

The evidence on the docket as well as the Notice of Mediation prove definitively that Deutsche Bank, the Law Offices of David J. Stern, Mr- Stern himself as lead attorney of the Law Offices of David J. Stern, and/or Florida Mediation Group, Inc. Intentionally and knowingly violated a court order, a crime defined by FL Crim. Stat. Sec. 3.840, Indirect Criminal- Contempt of Judge Roger Colton’s 4/1/2010 Order for Mediation to occur within 60 days at the plaintiff’s expense.

[ipaper docId=36380674 access_key=key-k536s7i0zqlwwkwipd1 height=600 width=600 /]

© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Posted in chain in title, CONTROL FRAUD, corruption, djsp enterprises, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, forgery, investigation, Law Offices Of David J. Stern P.A., lawsuit, MERS, MERSCORP, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., Mortgage Foreclosure FraudComments (0)

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