IN THE COURT OF COMMON PLEAS
CUYAHOGA COUNTY, OHIO
REO PROPERTIES CORP.,
Plaintiff,
vs.
THOMAS E. JEFFERS, et al,
EXCERPT:
11. Regarding the above letter, Degneau testified on cross-examination:
Q. . . . [H]ave you ever seen these three entities [DB Structured Products,
Inc., Green Tree SerVertis Acquisition LLC and U.S. Bank National
Association, not in its individual capacity, but solely as trustee for
SerVertis REO Pass-Through Trust I] listed as owners [of the note and
mortgage] or having been owners in a succession?
A. Not listed as owners . . . Green Tree services the loan for a group that’s
identified as SerVertis so its kind of an internal. . . classification.
Q. SerVertis is a trust is it not?
A. It’s not necessarily a trust. It’s sort of an investment group. . ..
Q. So that investment group owns the notes and mortgages in [a] pool [of
loans]?
A. In the pool yes. . . . But as far as in this case actually being the owner of
record [given] the status of the account at the time of conversion it was a
business decision not to change the owner of record at the time because
the action has already been started.
Q. [By the magistrate] Is this loan now owned by SerVertis?
A. The owner of record is REO Properties Corp.
Q. I understand the owner of record . . . I want to know who owns it now.. .?
A. Green Tree services the loan for SerVertis who in a pool of loans
purchased [the subject loan]. .. and Green Tree services for them now.
REO Properties is still the record owner.
Q. I understand that. I want to know who is the actual owner and according
to this [letter of November 18, 2009], it’s SerVertis Trust, is that accurate?
A. Well based on this I don’t think I can say yes to that because based on this
it says ‘the transfer of the ownership of your loan will be formally
recorded in the real property records of the county in which your mortgage
was originally recorded’. It was not recorded as SerVertis Pass-Through
Trust.
On redirect examination Degneau testified further:
Q. Can you tell the Court why ownership was not changed from REO
Properties to any other entity? . . .
A. There’s a legal action in place and the decision was made to . . . not
change the owner of record until.. the situation was resolved. It’s my
assumption that after the action . . . there will be a new recording.
Q. At the present time there has been no internal assignment or anything that
has been done to transfer ownership?
A. No, there has been no other internal transfers at all.
12. No other entities other than Ocwen, Green Tree and REO have attempted to
collect this debt from the Jeffers.
[…]
In this case, the note in question is endorsed in blank. Thus, REO would have
been the holder of the note and entitled to enforce the note at the time the case was filed
only if it possessed the note when the case was filed. See R.C. Sec. 1303.21(B); Vitols v.
Citizens Banking Co., 10 F.3d at 1235.
The original note was produced at trial. Off the record, REO’s counsel indicated
that the note came from “the vault”. The location or the owner of the vault was not
disclosed. There is no direct testimony regarding who was in actual possession of the
note either at the time of filing of the case or at the time of trial. Degneau, an employee
of Green Tree, testified that he was familiar with the note and was able to identify it.
Based on this testimony, it is likely that Green Tree possessed the note as servicing agent
on behalf of the party for whom it was servicing. As detailed above, it is more likely than
not that Green Tree was servicing this loan for DB Structured Products, Inc., not REO,
when this case was filed. Therefore, at that time, Green Tree possessed the note as agent
of DB Structured Products, Inc. REO was not in possession of the note when the case
was filed. Consequently, REO has filed to prove it was the “holder” of the note when the
case was filed and was not a party who is entitled to enforce the note as a holder. See Id.;
R.C. Sec.1303.31.
[…]
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