Violations | FORECLOSURE FRAUD | by DinSFLA

Tag Archive | "Violations"

[Video] Oral Arguments; Washington Supreme Court, BAIN v. MERS and Selkowitz v. Litton Loan Servicing

[Video] Oral Arguments; Washington Supreme Court, BAIN v. MERS and Selkowitz v. Litton Loan Servicing


Counsels for Kristin Bain & Kevin Selkowitz attorneys Melissa Huelsman and Richard Jones (great voice) did a FANTASTIC, OUTSTANDING JOB!!!

BOMBSHELL: Listen and watch when they ask MERS’ counsel “Who is the holder of the note”? HE DOES NOT KNOW & CANNOT ANSWER!

Oral arguments: Bain v. Mortgage Electronic Registration Sys, et al and Selkowitz v. Little “Litton” Loan Servicing, LP, et al. (May a party be a lawful beneficiary under WA’s Deed of Trust Act if it never held the promissory note secured by the deed of trust?)

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State Supreme Court to rule on legality of mortgage recording system (MERS)

State Supreme Court to rule on legality of mortgage recording system (MERS)


KOMO NEWS-

For the first time, a local homeowner’s fight to keep a house is headed to the state Supreme Court.

What happens there will effect thousands of people who’ve taken out mortgage loans in the past 10 years. If you own property, you need to know about a system known as MERS.

MERS stands for Mortgage Electronic Registration Systems. It was created by the real estate finance industry to simplify the process of transferring mortgage loans.

But struggling homeowners complain MERS also conceals the true note holder when your mortgage is sold to investors.

Kristen Bain’s comfortable condo in Tukwila is tied up in the MERS debate. First, she had to sue her mortgage broker and the lender for predatory lending and failure to provide proper documentation as required by law.

[KOMO NEWS]

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Amicus Brief of Washington State Attorney General Robert M. McKenna – Bain v. Metropolitan Mortgage and Selkowitz v. Litton Loan Servicing LP “MERS”

Amicus Brief of Washington State Attorney General Robert M. McKenna – Bain v. Metropolitan Mortgage and Selkowitz v. Litton Loan Servicing LP “MERS”


SUPREME COURT OF
THE STATE OF WASHINGTON

KRISTIN BAIN

vs

METROPOLITAN MORTGAGE GROUP INC. et al

[ipaper docId=81662045 access_key=key-24v4kd0j2bq2hhng7wkd height=600 width=600 /]

 

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Bain v. MERS (Wash. Supreme Court) Amicus of Atty Shawn Newman on behalf of Organization United for Reform (OUR) – Washington

Bain v. MERS (Wash. Supreme Court) Amicus of Atty Shawn Newman on behalf of Organization United for Reform (OUR) – Washington


Bain v. Metropolitan is set for hearing on March 15. This is an amicus from attorney Shawn Timothy Newman for Organization United for Reform (OUR) – Washington.

[ipaper docId=81423312 access_key=key-1mn29xvrh9m4blp1cj9v height=600 width=600 /]

 

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Hold banks to account for their role in crisis

Hold banks to account for their role in crisis


TOO Big to FAIL, doesn’t have to mean they’re TOO Big not to JAIL.

SacBee-

Three years ago this week, the financial system came unhinged. In rapid-fire succession, one major financial institution after another crumpled as years of recklessness on Wall Street and regulatory neglect in Washington took their toll. Before it was over, the federal government had committed trillions of dollars to bail out the nation’s largest banks and the economy was in tatters, with gnawing questions remaining about what went wrong and who was responsible.

The unraveling had dire consequences. Twenty-four million Americans are unemployed or unable to find full-time work, with wages as a share of gross domestic product at the lowest level since the 1930s. Meanwhile, the banks barely skipped a beat, with compensation at publicly traded Wall Street firms reaching a record $135 billion in 2010.

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FHFA v. UBS | Alleging violations in private label MBS sales to FannieMae and FreddieMac

FHFA v. UBS | Alleging violations in private label MBS sales to FannieMae and FreddieMac


UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
———————————-
FEDERAL HOUSING FINANCE AGENCY
AS CONSERVATOR FOR THE FEDERAL
NATIONAL MORTGAGE ASSOCIATION
AND THE FEDERAL HOME LOAN
MORTGAGE CORPORATION,

-AGAINST-

UBS AMERICAS INC., UBS REAL ESTATE
SECURITIES INC., UBS SECURITIES,
LLC, MORTGAGE ASSET
SECURITIZATION TRANSACTION, INC.,
DAVID MARTIN, PER DYRVIK, HUGH
CORCORAN, and PERTER SLAGOWITZ

[ipaper docId=61071280 access_key=key-2fomkzd72dimz4spdbu4 height=600 width=600 /]

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GASTINEAU v. GIFFORD, BANK OF AMERICA | VERIFIED SHAREHOLDER DERIVATIVE COMPLAINT FOR BREACH OF FIDUCIARY DUTY

GASTINEAU v. GIFFORD, BANK OF AMERICA | VERIFIED SHAREHOLDER DERIVATIVE COMPLAINT FOR BREACH OF FIDUCIARY DUTY


UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS

DORIS GASTINEAU, an individual,
Plaintiff,

vs.

CHARLES K. GIFFORD, THOMAS J.
MAY, BRIAN T. MOYNIHAN,
CHARLES O. HOLLIDAY, JR.,
MUKESH D. AMBANI, SUSAN S. BIES,
FRANK P. BRAMBLE, SR., VIRGIS W.
COLBERT, D. PAUL JONES, JR.,
MONICA C. LOZANO, DONALD E.
POWELL, CHARLES O. ROSSOTTI,
ROBERT W. SCULLY, WILLIAM P.
BOARDMAN, BARBARA J. DESOER
and KENNETH D. LEWIS,
Defendants,

and

BANK OF AMERICA CORPORATION,
Nominal Defendant.

[…]

This is a shareholder derivative action brought on behalf and for the benefit of Bank of America against certain of its current and former directors. Bank of America is a global financial services company, and provides consumers, corporations, governments and institutions with a range of financial products and services. Plaintiff seeks to remedy the serious financial and reputational harm that Bank of America has suffered, and will continue to suffer, from the inadequate servicing of its troubled residential mortgage loans. Plaintiff also seeks redress for the Company’s false and  misleading Schedule 14A definitive proxy statement filed with the SEC on March 30, 2011 (the “Proxy”).

[…]

[ipaper docId=60830442 access_key=key-2ojzndxj7anp8ae5fs0v height=600 width=600 /]

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LEYVA v. National Default Servicing Corp. | Nevada Supreme Court Remand and Reverse “Defective ASMT, U.C.C Article 3, No Endorsement, In Re Pasillas, Wells Fargo, MortgageIt”

LEYVA v. National Default Servicing Corp. | Nevada Supreme Court Remand and Reverse “Defective ASMT, U.C.C Article 3, No Endorsement, In Re Pasillas, Wells Fargo, MortgageIt”


Cite as: Leyva v. National Default Servicing Corp.

127 Nev. Adv. Op. No. 40

July 7, 2011

IN THE SUPREME COURT OF THE STATE OF NEVADA

No. 55216

MOISES LEYVA,

Appellant,

vs.

NATIONAL DEFAULT SERVICING CORP.; AMERICA’S SERVICING COMPANY; AND WELLS FARGO,

Respondents.

Appeal from a district court order denying a petition for judicial review in a foreclosure mediation action.  Eighth Judicial District Court, Clark County; Donald M. Mosley, Judge.

Reversed and remanded.

Crosby & Associates and David M. Crosby and Troy S. Fox, Las Vegas, for Appellant.

Snell & Wilmer, LLP, and Gregory A. Brower and Cynthia Lynn Alexander, Las Vegas, for Respondents America’s Servicing Company and Wells Fargo.

Wilde & Associates and Gregory L. Wilde, Las Vegas, for Respondent National Default Servicing Corp.

BEFORE THE COURT EN BANC.

OPINION

By the Court, HARDESTY, J.:

In this appeal, we consider issues arising out of Nevada’s Foreclosure Mediation Program.  First, we must determine whether a homeowner who is not the original mortgagor is a proper party to participate in the program.  We conclude that the Foreclosure Mediation statute, NRS 107.086, and the Foreclosure Mediation Rules (FMRs) dictate that a homeowner, even if he or she is not the named mortgagor, is a proper party entitled to request mediation following a notice of default.

Second, we must determine if a party is considered to have complied with the applicable statute and FMRs governing document production in a mediation proceeding by producing what the district court referred to as “essential documents.”  In this, we address whether substantial compliance satisfies the mandates of the statute and FMRs.  Because we conclude that strict compliance is compelled by NRS 107.086(4) and (5), that the assignment offered was defective, and that no endorsement of the mortgage note was provided according to Article 3 of the Uniform Commercial Code, we conclude that Wells Fargo failed to produce the documents required under NRS 107.086(4).  Additionally, we recently concluded in Pasillas v. HSBC Bank USA, 127 Nev. ___, ___ P.3d ___ (Adv. Op. No. 39, July 7, 2011), that a party’s failure to produce the enumerated documents required by NRS 107.086 and the FMRs prohibits the district court from directing the program administrator to certify the mediation so that the foreclosure process can proceed.  Here, we again conclude that, due to the statute’s and the FMRs’ mandatory language regarding document production, a party is considered to have fully complied with the statute and rules only upon production of all documents required.  Failure to do so is a sanctionable offense, and the district court is prohibited from allowing the foreclosure process to proceed.  Therefore, we must reverse and remand this case to the district court for it to determine appropriate sanctions against respondents.[1]

FACTS AND PROCEDURAL HISTORY

Appellant Moises Leyva received and recorded a quitclaim deed in 2007 in exchange for taking over monthly mortgage payments on a residence in Las Vegas.  Leyva did not expressly assume the mortgage note, however, and it remained in the original mortgagor’s name, Michael Curtis Ramos.  Nonetheless, Leyva made the mortgage payments in Leyva’s name to respondent Wells Fargo’s servicing company for 25 months.  Thereafter, Leyva defaulted on the mortgage and, upon receiving a notice of election to sell, decided to pursue mediation through the Foreclosure Mediation Program.  Both he and Ramos signed the form electing to mediate.  The mediation occurred on September 23, 2009,[2] and Leyva, Ramos, and Wells Fargo were represented by counsel at the mediation.  Leyva was present at the mediation, while Ramos was available by telephone.  At the mediation, Wells Fargo produced a certified copy of the original deed of trust and mortgage note, on both of which MortgageIT, Inc., not Wells Fargo, was named as the lender, as well as a notarized statement from a Wells Fargo employee asserting that Wells Fargo was in possession of the deed of trust and mortgage note, as well as any assignments thereto.  Wells Fargo did not submit copies of any assignments.  The parties failed to resolve the foreclosure at the mediation, and the mediator’s statement indicated that Wells Fargo failed to bring the statutorily required documents to the mediation.  The mediator did not, however, indicate that Wells Fargo participated in the mediation in bad faith.

Leyva then filed a petition for judicial review in district court, claiming that Wells Fargo mediated in bad faith and that it should be sanctioned.  After conducting hearings on the petition, the district court found that

there is a lack of showing of bad faith on the part of [Wells Fargo] in that all essential documents were provided, contrary to the indication of the mediator, and that [Wells Fargo] otherwise negotiated in good faith notwithstanding the fact that an agreement was not reached.

Absent timely appeal, a Letter of Certification shall enter.

(Emphasis added.)  This appeal followed.[3]

DISCUSSION

In resolving this appeal, as a preliminary matter, we must determine whether Leyva could properly elect to mediate and participate in the mediation even though he was not a named party on the mortgage note and did not assume the note in his purchase of the residence.  Determining that he could participate as the title holder of record, we next consider whether the district court erred in finding that Wells Fargo brought “all essential documents” to the mediation.  In doing so, we address Wells Fargo’s argument that possessing the original mortgage note and deed of trust is sufficient to demonstrate ownership of the same.  We conclude that Wells Fargo failed to produce the documents required under the applicable statute and FMRs and to otherwise show that it had an enforceable interest in the property subject of the mediation.  Accordingly, the district court abused its discretion, and sanctions are warranted pursuant to our holding in Pasillas, 127 Nev. at ___, ___ P.3d at ___.

Leyva was a proper party to the mediation

Wells Fargo first argues that because Leyva was neither the grantor on the deed of trust nor the obligor on the note, he was not a proper party to the mediation.  We disagree.

NRS 107.086(3) allows “[t]he grantor or the person who holds the title of record” to elect to mediate.  (Emphasis added.)  Similarly, FMR 5(1) states that “any grantor or person who holds the title of record and is the owner-occupant of a residence” is eligible to participate in the Foreclosure Mediation Program.  (Emphasis added.)  Leyva recorded his ownership of the subject property in March 2007 and is therefore clearly the title holder of record eligible to participate in the Foreclosure Mediation Program.

Even though the mortgage note remained in Ramos’s name, this bifurcation of title ownership and liability on the note served only to potentially limit the foreclosure solutions available to Leyva at the mediation, not to exclude all possible remedies.  And while Wells Fargo argues that modification was not an option because Leyva lacked authority over the loan, the record reflects that Ramos, the person with such authority, signed the election-of-mediation form, was represented by counsel at the mediation, and was available by telephone during the mediation.  Therefore, Wells Fargo’s argument lacks merit.  Regardless, because both NRS 107.086(3) and FMR 5(1) permit the person holding the title of record to mediate, and Wells Fargo does not dispute that Leyva possessed a valid, recorded quitclaim deed, we conclude that Leyva could properly elect to mediate and was eligible to participate in the Foreclosure Mediation Program.

Wells Fargo failed to meet the mediation program’s documentation requirements, compelling consideration of sanctions

In Pasillas, we held that if a party fails to (1) provide the required documents, or (2) either attend the mediation in person or, if the beneficiary attends through a representative, that person fails to have authority to modify the loan or access to such a person, the district court is required to impose appropriate sanctions.  127 Nev. at ___, ___ P.3d at ___. Here, despite Wells Fargo’s failure to bring the assignments for the mortgage note and deed of trust, the district court refused to impose sanctions.[4]  “[W]e . . . review a district court’s decision regarding the imposition of sanctions for a party’s participation in the Foreclosure Mediation Program under an abuse of discretion standard.”  Id.

Wells Fargo concedes that it did not provide written assignments of the deed of trust and mortgage note as required by NRS 107.086(4) and FMR 5(6).  Nevertheless, it argues that it fulfilled the purpose of the statute and rule, and thus, its failure to bring actual copies of any assignments was harmless.  In essence, Wells Fargo asserts that its failure to strictly comply with the statute’s and FMRs’ requirements should not subject it to sanctions, because it substantially complied with those requirements.

“Substantial compliance may be sufficient ‘to avoid harsh, unfair or absurd consequences.’  Under certain procedural statutes and rules, however, failure to strictly comply . . . can be fatal to a case.”  Leven v. Frey, 123 Nev. 399, 407, 168 P.3d 712, 717 (2007) (quoting 3 Norman J. Singer, Statutes and Statutory Construction § 57:19, at 58 (6th ed. 2001)).  To determine whether a statute and rule require strict compliance or substantial compliance, this court looks at the language used and policy and equity considerations.  Id. at 406-07, 168 P.3d at 717.  In so doing, we examine whether the purpose of the statute or rule can be adequately served in a manner other than by technical compliance with the statutory or rule language.  See id. at 407 n.27, 168 P.3d at 717 n.27 (citing White v. Prince George’s County, 877 A.2d 1129, 1137 (Md. Ct. Spec. App. 2005) (“Where the purpose of the notice requirements is fulfilled, but not necessarily in a manner technically compliant with all of the terms of the statute, this Court has found such substantial compliance to satisfy the statute.” (internal quotation omitted))).

Here, both the statutory language and that of the FMRs provide that the beneficiary “shall” bring the enumerated documents, and we have previously recognized that “‘shall’ is mandatory unless the statute demands a different construction to carry out the clear intent of the legislature.”  S.N.E.A. v. Daines, 108 Nev. 15, 19, 824 P.2d 276, 278 (1992); see also Pasillas, 127 Nev. at ___, ___ P.3d at ___.  The legislative intent behind requiring a party to produce the assignments of the deed of trust and mortgage note is to ensure that whoever is foreclosing “actually owns the note” and has authority to modify the loan.  See Hearing on A.B. 149 Before the Joint Comm. on Commerce and Labor, 75th Leg. (Nev., February 11, 2009) (testimony of Assemblywoman Barbara Buckley).  Thus, we determine that NRS 107.086 and the FMRs necessitate strict compliance.

Because we conclude that strict compliance is necessary, we must discuss what constitutes a valid assignment of deeds of trust and mortgage notes.  Transfers of deeds of trust and mortgage notes are distinctly separate, thus we discuss each one in turn.

The deed of trust, with any assignments, identifies the person who is foreclosing

In this case, Wells Fargo was not the original named beneficiary on the deed of trust, but it contends on appeal that it has the right to foreclose as the assignee of the original beneficiary, MortgageIT.  Although Wells Fargo conceded during oral argument that it did not provide the written assignment, it claims that because it provided a certified copy of the deed of trust and a notarized statement from its employee claiming that it was the rightful owner of the deed of trust, no written assignment was necessary.  We disagree.

A deed of trust is an instrument that “secure[s] the performance of an obligation or the payment of any debt.”  NRS 107.020.  This court has previously held that a deed of trust “constitutes a conveyance of land as defined by NRS 111.010.”[5]  Ray v. Hawkins, 76 Nev. 164, 166, 350 P.2d 998, 999 (1960).  The statute of frauds governs when a conveyance creates or assigns an interest in land:

No estate or interest in lands, . . . nor any trust or power over or concerning lands, or in any manner relating thereto, shall be created, granted, assigned, surrendered or declared . . . , unless . . . by deed or conveyance, in writing, subscribed by the party creating, granting, assigning, surrendering or declaring the same, or by the party’s lawful agent thereunto authorized in writing.

NRS 111.205(1) (emphases added).  Thus, to prove that MortgageIT properly assigned its interest in land via the deed of trust to Wells Fargo, Wells Fargo needed to provide a signed writing from MortgageIT demonstrating that transfer of interest.  No such assignment was provided at the mediation or to the district court, and the statement from Wells Fargo itself is insufficient proof of assignment.  Absent a proper assignment of a deed of trust, Wells Fargo lacks standing to pursue foreclosure proceedings against Leyva.

Mortgage note

The proper method of transferring the right to payment under a mortgage note is governed by Article 3 of the Uniform Commercial Code- Negotiable Instruments, because a mortgage note is a negotiable instrument.[6]  Birkland v. Silver State Financial Services, Inc., No. 2:10-CV-00035-KJD-LRL, 2010 WL 3419372, at *4 (D. Nev. Aug. 25, 2010).  The obligor on the note has the right to know the identity of the entity that is “entitled to enforce” the mortgage note under Article 3, see NRS 104.3301, “[o]therwise, the [homeowner] may pay funds to a stranger in the case.”  In re Veal, No. 09-14808, 2011 WL 2304200, at *16 (B.A.P. 9th Cir. June 10, 2011) (holding, in a bankruptcy case, that AHMSI did not prove that it was the party entitled to enforce, and receive payments from, a mortgage note because it “presented no evidence as to who possessed the original Note.  It also presented no evidence showing [e]ndorsement of the note either in its favor or in favor of Wells Fargo, for whom AHMSI allegedly was servicing the [bankrupt party’s] Loan.”).  If the homeowner pays funds to a “stranger in the case,” then his or her obligation on the note would not be reduced by the payments made. See id. at *7 (“if a[n obligor on a mortgage note] makes a payment to a ‘person entitled to enforce,’ the obligation is satisfied on a dollar for dollar basis, and the [obligor] never has to pay that amount again”).

Wells Fargo argues that, under Nevada law, possession of the original note allowed it to enforce the note.  We disagree and take this opportunity to clarify the applicability of Article 3 to mortgage notes, as we anticipate increasing participation in the Foreclosure Mediation Program, as well as a corresponding increase in the number of foreclosure appeals in this state.  As discussed below, we conclude that Article 3 clearly requires Wells Fargo to demonstrate more than mere possession of the original note to be able to enforce a negotiable instrument under the facts of this case.

Pursuant to NRS 104.3102(1), Article 3 applies to negotiable instruments.  Negotiable instruments are defined as

an unconditional promise or order to pay a fixed amount of money, with or without interest or other charges described in the promise or order, if it:

(a) Is payable to bearer or to order at the time it is issued or first comes into possession of a holder;

(b) Is payable on demand or at a definite time; and

(c) Does not state any other undertaking or instruction by the person promising or ordering payment to do any act in addition to the payment of money.

NRS 104.3104(1).  Thus, a mortgage note is a negotiable instrument, and any negotiation of a mortgage note must be done in accordance with Article 3.

A note can be made payable to bearer or payable to order.  NRS 104.3109.  If the note is payable to bearer, that “indicates that the person in possession of the promise or order is entitled to payment.”  NRS 104.3109(1)(a).  However, “[a] promise or order that is not payable to bearer is payable to order if it is payable to the order of an identified person . . . . A promise or order that is payable to order is payable to the identified person.”  NRS 104.3109(2).

For a note in order form to be enforceable by a party other than to whom the note is originally payable, the note must be either negotiated or transferred.[7]  A “‘[n]egotiation’ means a transfer of possession, whether voluntary or involuntary, of an instrument by a person other than the issuer to a person who thereby becomes its holder.”  NRS 104.3201(1).  “[I]f an instrument is payable to an identified person, negotiation requires transfer of possession of the instrument and its endorsement by the holder.”[8]  NRS 104.3201(2) (emphasis added).  An “endorsement” is a signature that is “made on an instrument for the purpose of negotiating the instrument.”  NRS 104.3204(1).  Thus, if the note is payable to the order of an identifiable party, but is then sold or otherwise assigned to a new party, it must be endorsed by the party to whom it was originally payable for the note to be considered properly negotiated to the new party.  Once a proper negotiation occurs, the new party, or “note holder,” with possession is entitled to enforce the note.  NRS 104.1201(2)(u)(1) (“Holder means . . . [t]he person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession.”).

If a party cannot attain “holder” status by showing a valid negotiation, the party may establish its right to enforce the note by showing that the note has been validly transferred.  NRS 104.3203(2).  The only distinction between a negotiation and a transfer is that, in the case of a transfer, the note need not be endorsed by the party who is relinquishing enforcement rights.  Because a transferred note is not endorsed, however, the party seeking to establish its right to enforce the note “must account for possession of the unendorsed instrument by proving the transaction through which the transferee acquired it.”  U.C.C. § 3-203 cmt. 2 (explaining the effect of § 3-203(b), codified in Nevada as NRS 104.3203(2)).  In other words, because the party seeking to enforce the note cannot “prove” its right to enforce through the use of a valid endorsement, the party must “prove” by some other means that it was given possession of the note for the purpose of enforcing it.[9]

In this case, the adjustable rate mortgage note provides:  “In return for a loan that I have received, I promise to pay U.S. $192,000.00 . . . plus interest, to the order of Lender.  Lender is [MortgageIT, Inc.]” (emphasis added).  Because the mortgage note is payable to the order of a specific party, MortgageIT, to negotiate the note to a new party, in this case Wells Fargo, Wells Fargo must have possession of the note and the note must be properly endorsed by MortgageIT.  See NRS 104.3201(2).  No such endorsement was included in the documents produced at mediation or in the documents filed with the district court, nor was a valid assignment produced as proof of the note’s transfer, and mere possession does not entitle Wells Fargo to enforce the note.  Therefore, because the mortgage note is payable to MortgageIT, unless Wells Fargo can prove that the note was properly endorsed or validly transferred, thereby making it the party entitled to enforce the note, it has not demonstrated authority to mediate the note.

As we concluded in Pasillas, a foreclosing party’s failure to bring the required documents to the mediation is a sanctionable offense under NRS 107.086 and the FMRs.  Therefore, we conclude that the district court abused its discretion when it denied Leyva’s petition for judicial review.  Accordingly, we reverse the district court’s order and remand this matter to the district court with instructions to determine the appropriate sanctions for Wells Fargo’s violation of the statutory and rule-based requirement.  In doing so, the district court should consider the factors discussed in Pasillas.[10]

DOUGLAS, C.J., and CHERRY, SAITTA, GIBBONS, PICKERING, and PARRAGUIRRE, JJ., concur.

**********FOOTNOTES**********

[1]        Because we reverse on other grounds, we do not reach Leyva’s contention that respondent Wells Fargo also participated in the mediation in bad faith because it refused to offer anything other than a cash-for-keys option to avoiding foreclosure.

[2]        Therefore, this mediation was governed by the Foreclosure Mediation Rules in effect from July 31, 2009, until September 28, 2009, at which time the rules were amended.  See In the Matter of the Adoption of Rules for Foreclosure Mediation, ADKT 435 (Order Adopting Foreclosure Mediation Rules, June 30, 2009, and Order Amending Foreclosure Mediation Rules and Adopting Forms, September 28, 2009).  Although the changes required some renumbering of the rules, the language of the rules important to this case, namely, those specifying who can participate in the mediation and the documents that must be provided, remain essentially the same.

[3]        This court has jurisdiction over the appeal from the district court’s final order in the judicial review proceeding.  Nev. Const. art. 6, § 4; NRAP 3A(b)(1).

[4]        At the time the district court entered its order, the Pasillas opinion had not been published.

[5]        “‘Conveyance’ shall be construed to embrace every instrument in writing, except a last will and testament, whatever may be its form, and by whatever name it may be known in law, by which any estate or interest in lands is created, aliened, assigned or surrendered.”  NRS 111.010(1).

[6]        Article 3 is codified in NRS 104.3101-.3605.

[7]        Since the documents provided at the mediation did not establish transfer of either the mortgage or the note, we express no opinion on the issue addressed in the Restatement (Third) of Property section 5.4 concerning the effect on the mortgage of the note having been transferred or the reverse.

[8]        Under NRS 104.3301(1)(a), a person entitled to enforce an instrument is “[t]he holder of the instrument.”

[9]        To “prove” a transaction under NRS 104.3203(2), a party must present evidence sufficient to establish that it is more likely than not that the transaction took place.  NRS 104.3103(1)(i) (defining “prove”); NRS 104.1201(h) (defining “burden of establishing”).

[10]      In Pasillas, we concluded that the following nonexhaustive list of factors would aid district courts in determining what sanctions are appropriate: “whether the violations were intentional, the amount of prejudice to the nonviolating party, and the violating party’s willingness to mitigate any harm by continuing meaningful negotiation.”  Pasillas v. HSBC Bank USA, 127 Nev. ___, ___, ___ P.3d ___, ___ (Adv. Op. No. 39, July 7, 2011).


*****************************

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PASILLAS v. HSBC Bank USA | Nevada Supreme Court Reverse “Sanctionable offenses under the Foreclosure Mediation Program, IBANEZ, AHMSI, Alleged Assignment”

PASILLAS v. HSBC Bank USA | Nevada Supreme Court Reverse “Sanctionable offenses under the Foreclosure Mediation Program, IBANEZ, AHMSI, Alleged Assignment”


Cite as: Pasillas v. HSBC Bank USA

127 Nev. Adv. Op. 39

EMILIANO PASILLAS AND YVETTE PASILLAS, Appellants,
v.
HSBC BANK USA, AS TRUSTEE FOR LUMINENT MORTGAGE TRUST; POWER DEFAULT SERVICES, TRUSTEE; AND AMERICAN HOME MORTGAGE SERVICING, INC., Respondents.

No. 56393.

Supreme Court of Nevada.

July 7, 2011.

Terry J. Thomas, Reno, for Appellants.

Pite Duncan, LLP, and Gregg A. Hubley, Laurel I. Handley, and Cuong M. Nguyen, Las Vegas, for Respondents.

BEFORE THE COURT EN BANC.

OPINION

By the Court, HARDESTY, J.:

In this appeal, we consider issues arising out of Nevada’s Foreclosure Mediation Program and address whether a lender commits sanctionable offenses when it does not produce documents and does not have someone present at the mediation with the authority to modify the loan, as set forth in the applicable statute, NRS 107.086, and the Foreclosure Mediation Rules (FMRs).

Because NRS 107.086 and the FMRs expressly require that certain documents be produced during foreclosure mediation and that someone with authority to modify the loan must be present or accessible during the mediation, we conclude that a party’s failure to comply with these requirements is an offense subject to sanctions by the district court. In such an event, the district court shall not direct the program administrator to certify the mediation to allow the foreclosure process to proceed until the parties have fully complied with the statute and rules governing foreclosure mediation.

Here, because respondents HSBC Bank USA, Power Default Services, and American Home Mortgage Servicing, Inc. (AHMSI), did not bring the required documents to the mediation and did not have access to someone authorized to modify the loan during the mediation, we conclude that the district court erred in denying appellants Emiliano and Yvette Pasillas’s petition for judicial review. Therefore, we reverse the district court’s order and remand this matter to the district court so that the court may determine sanctions.

FACTS AND PROCEDURAL HISTORY

The Pasillases purchased a home in Reno in 2006 with a loan from American Brokers Conduit. The note and deed of trust were allegedly assigned to HSBC.[1] Near the end of 2009, Power Default Services became a substitute trustee, removing HSBC from that role. Allegedly, the servicer for the Pasillases’ loan is AHMSI.[2]

When the Pasillases defaulted on their mortgage and received a notice of election to sell, they elected to mediate pursuant to the Foreclosure Mediation Program provided for in NRS 107.086. Two separate mediations occurred, one on February 18, 2010, and one on March 8, 2010,[3] but neither mediation resulted in a resolution.

While a representative of AHMSI was available by phone at both mediations, it is unclear whether HSBC was present or represented by counsel. There is some disagreement between the parties regarding who the respondents’ attorneys represented at the mediations and at the hearing on the petition for judicial review. In the addendum to the mediator’s statement, the mediator stated that “HSBC . . . was identified as Beneficiary . . . and represented by Cuong Nguyen, Esq. of Pite Duncan, LLP.” In the second mediation, the mediator indicated that “HSBC . . . was again identified as Beneficiary . . . and represented by Heather Hudson, Esq. of Pite Duncan, LLP.” However, in responding to the Pasillases’ petition for judicial review, the Pite Duncan law firm indicated that it was not counsel for HSBC. Specifically, the response opened with the following statement: “Respondents AMERICAN HOME MORTGAGE SERVICING, INC. (`AHMSI’), erroneously named herein as HSBC BANK USA AS TRUSTEE FOR LUMINENT MORTGAGE TRUST.” Respondents also claimed that the Pasillases were “incorrect that Pite Duncan, LLP attended [the mediations] on behalf of HSBC.” At oral argument before this court, respondents’ counsel stated that they represented all of the respondents named in this case at the mediations, but they did not dispute the mediator’s finding that respondents needed additional authority from investors to agree to a loan modification.

After both mediations were completed, the mediator filed a statement indicating that (1) “[t]he parties participated but were unable to agree to a loan modification or make other arrangements,” (2) “[t]he beneficiary or his representative failed to participate in good faith,” and (3) “[t]he beneficiary failed to bring to the mediation each document required.” The mediator also filed an addendum to his statement, wherein he stated that two pages of the mortgage note were missing, that the assignment purportedly assigning the mortgage note and deed of trust to HSBC was incomplete, that instead of an appraisal HSBC provided a broker’s price opinion,[4] and that respondents stated they would need additional investor approval before agreeing to a loan modification. The mediator concluded that he would not recommend that the administrator issue a certificate authorizing further foreclosure proceedings because HSBC “failed to participate in [the] mediation in good faith as evidenced by its failure to produce required documents and information initially, or subsequently to cure its failures.” The Pasillases subsequently filed a petition for judicial review in the district court. In the petition, the Pasillases requested sanctions in the form of a modification of their mortgage and attorney fees.

The district court conducted a short hearing, during which the only issue addressed was the parties’ failure to come to an agreement. The district court did not address whether respondents failed to provide the required documents at the mediation or whether respondents lacked the requisite authority at the mediation to modify the loan. After the hearing, the district court entered an order finding that “Respondents] [have] met the burden to show cause why sanctions should not lie,” and directed the Foreclosure Mediation Program administrator to issue a certification authorizing the foreclosure to proceed. The Pasillases appealed.

DISCUSSION

In resolving this appeal, we must determine whether the district court abused its discretion when it refused to enter sanctions against respondents for failing to satisfy express statutory requirements and allowed respondents to continue with the foreclosure process. We begin our discussion with a brief background of the Foreclosure Mediation Program.

The Foreclosure Mediation Program

The Nevada Legislature enacted the Foreclosure Mediation Program in 2009 in response to the increasing number of foreclosures in this state. Hearing on A.B. 149 Before the Joint Comm. on Commerce and Labor, 75th Leg. (Nev., February 11, 2009) (testimony of Assemblywoman Barbara Buckley). The program requires that a trustee seeking to foreclose on an owner-occupied residence provide an election-of-mediation form along with the notice of default and election to sell. NRS 107.086(2)(a)(3). If the homeowner elects to mediate, both the homeowner and the deed of trust beneficiary must attend, must mediate in good faith, provide certain enumerated documents,[5] and, if the beneficiary attends through a representative, that person must have authority to modify the loan or have “access at all times during the mediation to a person with such authority.” NRS 107.086(4), (5); FMR 5(7)(a). After the conclusion of the mediation, the mediator must file a mediator’s statement with the program administrator, indicating whether all parties complied with the statute and rules governing the program. FMR 12(2). If the beneficiary does not (1) attend the mediation; (2) mediate in good faith; (3) provide the required documents; or (4) if attending through a representative, have a person present with authority to modify the loan or access to such a person, the mediator is required to “submit … a petition and recommendation concerning the imposition of sanctions.”[6] NRS 107.086(5). The homeowner may then file a petition for judicial review with the district court,[7] and the court “may issue an order imposing such sanctions against the beneficiary of the deed of trust or the representative as the court determines appropriate.” See FMR 5(7)(f).[8] But if the district court finds that the parties met the four program requirements, it will direct the program administrator to certify the mediation, allowing the foreclosure process to proceed. See NRS 107.086(2)(c)(2), (3), (6), (7).

Respondents failed to meet the mediation program’s statutory requirements

The Pasillases argue that respondents failed to meet the program’s requirements—the document requirement because respondents failed to bring a complete mortgage note and failed to provide assignments of the note and deed of trust, and the loan modification authority requirement because they failed to have someone present at the mediation with the authority to modify the loan. We agree.

The scope and meaning of a statute is a question of law, which we review de novo. Arguello v. Sunset Station, Inc., 127 Nev. ___, ___ P.3d ___. (Adv. Op. No. 29, June 2, 2011). Court rules are also subject to de novo review. Moon v. McDonald Carano Wilson LLP, 126 Nev. ___, ___, 245 P.3d 1138, 1139 (2010). “When the language in a provision is clear and unambiguous, this court gives `effect to that meaning and will not consider outside sources beyond that statute.'” City of Reno v. Citizens for Cold Springs, 126 Nev. ___, ___, 236 P.3d 10, 16 (2010) (quoting NAIW v. Nevada Self-Insurers Association, 126 Nev. ___, ___, 225 P.3d 1265, 1271 (2010)).

Both NRS 107.086 and the FMRs use the word “shall” or “must” when listing the actions required of parties to a foreclosure mediation. Use of the word “shall” in both the statutory language and the FMRs indicates a duty on the part of the beneficiary, and this court has stated that “`shall’ is mandatory unless the statute demands a different construction to carry out the clear intent of the legislature.” S.N.E.A. v. Daines, 108 Nev. 15, 19, 824 P.2d 276, 278 (1992). Additionally, Black’s Law Dictionary defines “shall” as meaning “imperative or mandatory. . . . inconsistent with a concept of discretion.” 1375 (6th ed. 1990). And as it is used here, “must” is a synonym of “shall.” We conclude that NRS 107.086(4) and (5) and FMR 5(7)(a) clearly and unambiguously mandate that the beneficiary of the deed of trust or its representative (1) attend the mediation, (2) mediate in good faith, (3) provide the required documents, and (4) have a person present with authority to modify the loan or access to such a person.

Here, the mediator’s statement and his addendum to that statement, which were provided to the district court in the Pasillases’ petition for judicial review, clearly set out respondents’ failure to bring the required documents to the mediation and to have someone present with authority to modify the loan. Additionally, respondents do not dispute that they failed to bring all the required documents to the mediation.[9] Although respondents argue on appeal that their counsel at the mediation “had the requisite authority and/or access to a person with the authority to modify the loan,” they do not controvert the mediator’s statement that their counsel claimed at the mediation that additional investor approval was needed in order to modify the loan. The record before the district court demonstrates that respondents failed to meet the statutory requirements. Nonetheless, respondents argue that the district court’s conclusion that sanctions were unwarranted did not constitute an abuse of discretion because, despite the failures noted above, they mediated to resolve the foreclosure in good faith. We disagree.

Standard of review

At the outset, we establish that we will review a district court’s decision regarding the imposition of sanctions for a party’s participation in the Foreclosure Mediation Program under an abuse of discretion standard. See Arnold v. Kip, 123 Nev. 410, 414, 168 P.3d 1050, 1052 (2007) (abuse of discretion standard used to review district court’s imposition of sanctions on a party for discovery abuses); Banks v. Sunrise Hospital, 120 Nev. 822, 830, 102 P.3d 52, 58 (2004) (reviewing sanctions imposed for spoliation of evidence under an abuse of discretion standard). When determining whether the district court has abused its discretion in such cases, we do not focus on whether the court committed manifest error, but rather we focus on whether the district court made any errors of law.

Failure to satisfy statutory mandates is a sanctionable offense

As discussed above, under NRS 107.086(5), there are four distinct violations a party to a foreclosure mediation can make: (1) “fail[ure] to attend the mediation,” (2) “fail[ure] to participate in the mediation in good faith,” (3) failure to “bring to the mediation each document required,” and (4) failure to demonstrate “the authority or access to a person with the authority [to modify the loan].” If any one of these violations occurs, the mediator must recommend sanctions. Id. If the homeowner petitions for judicial review, “[t]he court may issue an order imposing such sanctions against the beneficiary of the deed of trust or the representative as the court determines appropriate.” Id. We interpret NRS 107.086(5) to mean that the commission of any one of these four statutory violations prohibits the program administrator from certifying the foreclosure process to proceed and may also be sanctionable. See Tarango v. SIIS, 117 Nev. 444, 451 n.20, 25 P.3d 175, 180 n.20 (2001) (explaining that “may” can be interpreted as “shall” in order to carry out the Legislature’s intent, which in the instant case was to make mandatory the requirements set forth in NRS 107.086(5)).

In this case, despite the mediator’s opinion that respondents did not participate in the mediation in good faith based on their failure to comply with the FMRs, the district court did not impose sanctions and instead entered a Letter of Certification that allowed respondents to proceed with the foreclosure process on the Pasillases’ property. The district court essentially ignored the fact that respondents failed to bring “to the mediation each document required” and did “not have the authority or access to a person with the authority” to modify the loan, failures which we determine constitute sanctionable offenses. Thus, the district court’s order directing the program administrator to enter a letter of certification and its failure to consider sanctions was an abuse of discretion because respondents clearly violated NRS 107.086 and the FMRs.[10] This abuse requires us to remand the case for the district court to consider appropriate sanctions.

The nature of the sanctions imposed on the beneficiary or its representative is within the discretion of the district court. We have previously listed factors to aid district courts when considering sanctions as punishment for litigation abuses. See Young v. Johnny Ribeiro Building, 106 Nev. 88, 93, 787 P.2d 777, 780 (1990); see also Bahena v. Goodyear Tire & Rubber Co., 126 Nev. ___, ___, 235 P.3d 592, 598-99 (2010); Arnold, 123 Nev. at 415-16, 168 P.3d at 1053. However, we conclude that other factors, more specific to the foreclosure mediation context, apply when a district court is considering sanctions in such a case. When determining the sanctions to be imposed in a case brought pursuant to NRS 107.086 and the FMRs, district courts should consider the following nonexhaustive list of factors: whether the violations were intentional, the amount of prejudice to the nonviolating party, and the violating party’s willingness to mitigate any harm by continuing meaningful negotiation.

Because, in this case, the foreclosing party’s failure to bring the required documents to the mediation and to have someone present at the mediation with the authority to modify the loan were sanctionable offenses under the Foreclosure Mediation Program, the district court abused its discretion when it denied the Pasillases’ petition for judicial review and ordered the program administrator to enter a letter of certification authorizing the foreclosure process to proceed. Therefore, we reverse the district court’s order and remand this matter to the district court with instructions to determine the appropriate sanctions for respondents’ violations of the statutory and rule-based requirements.

DOUGLAS, C.J., CHERRY, SAITTA, GIBBONS, PICKERING and PARRAGUIRRE, JJ., concur.

[1] The Pasillases claim that HSBC failed to provide a valid assignment; the one it provided during the mediation was signed by American Brokers Conduit but did not state who the assignee was.

[2] The parties do not argue and we do not reach the question of whether AHMSI is a valid agent for HSBC or the real party in interest, or the “person entitled to enforce” the promissory note in this case. See In re Veal, No. 09-14808, 2011 WL 2304200, at *12-14 (B.A.P. 9th Cir. June 10, 2011).

[3] These mediations were governed by the Foreclosure Mediation Rules (FMRs) as amended on November 4, 2009.

[4] We note that while FMR 11(7)(b) currently allows for a broker’s price opinion in lieu of an appraisal, the rules applicable to this matter called for an appraisal without mention of a broker’s price opinion. In the Matter of the Adoption of Rules for Foreclosure Mediation, ADKT 435 (Order Adopting Foreclosure Mediation Rules, June 30, 2009, and Order Amending Foreclosure Mediation Rules and Adopting Forms, November 4, 2009).

[5] With regard to the documents required, NRS 107.086(4) provides that “[t]he beneficiary of the deed of trust shall bring to the mediation the original or a certified copy of the deed of trust, the mortgage note[,] and each assignment of the deed of trust or mortgage note.” The FMRs echo this documentation requirement nearly word for word. FMR 5(7)(a). FMR 7(2) also provides that “[t]he beneficiary of the deed of trust or its representatives shall produce an appraisal. . . and shall prepare an estimate of the `short sale’ value of the residence.”

[6] If the homeowner fails to attend the mediation, the administrator will certify that no mediation is required. NRS 107.086(6).

[7] Generally, if the parties fail to reach an agreement and neither party files a petition for judicial review, the program administrator will certify the mediation, which allows the foreclosure process to proceed. NRS 107.086(3), (6), (7).

[8] The current version of the FMRs requires the district court to review a case de novo when a party files a petition for judicial review. FMR 21(5) (rules including amendments through March 1, 2011). De novo review may include an evidentiary hearing concerning what transpired at the mediation. See Black’s Law Dictionary 924 (9th ed. 2009) (defining “de novo judicial review” as “[a] court’s nondeferential review of an administrative decision, usu[ally] through a review of the administrative record plus any additional evidence the parties present”).

[9] At oral argument, respondents’ counsel argued that an assignment for the mortgage note was provided, but the name of the assignee was missing. We determine that an assignment provided without the name of the assignee is defective for the purposes of the Foreclosure Mediation Program because it does not identify the relevant parties.

The Supreme Judicial Court of Massachusetts recently reached the same conclusion regarding the production of assignments to mortgage notes and deeds of trust, albeit in a slightly different context. In U.S. Bank National Ass’n v. Ibanez, 941 N.E.2d 40 (Mass. 2011), two separate banks foreclosed on the mortgages of two homeowners whose properties the banks then bought at the foreclosure sales. Id. at 44. The banks later filed complaints in the lower court seeking a declaration that they had clear title to the properties. Id. Because the banks failed to show an interest in the mortgages at the time of the foreclosure sales, the sales were invalid, and the lower court entered judgment against the banks. Id. at 45. On appeal, the court determined that, similar to this case, the banks were not the original mortgagees and, therefore, they had to show that the mortgages were properly assigned to them in writings signed by the grantors before they could notice the sales and foreclosures of the properties. Id. at 51. In an attempt to prove that they had the authority to foreclose on the properties, the banks provided contracts purporting to assign to them bundles of mortgages; however, the attachments that identified what mortgages were being assigned were not included in the documents provided. Id. at 52. The court concluded that the banks demonstrated no authority to foreclose on the properties because they did not have the assignments. Id. at 53 (“We have long held that a conveyance of real property, such as a mortgage, that does not name the assignee conveys nothing and is void; we do not regard an assignment of land in blank as giving legal title in land to the bearer of the assignment.”). The court additionally stated that “[a] plaintiff that cannot make this modest showing cannot justly proclaim that it was unfairly denied a declaration of clear title.” Id. at 52. We agree with the rationale that valid assignments are needed when a beneficiary of a deed of trust seeks to foreclose on a property.

[10] Respondents argue that this court should decline to address the Pasillases’ argument that respondents failed to provide someone at the mediation with the authority to modify the loan because it was not raised in the petition for judicial review. First, we note that our decision here would require the district court to impose sanctions even if respondents’ only omission was the failure to provide the required documents. However, we determine that the Pasillases adequately raised this issue in their petition for judicial review by alleging that respondents’ counsel at the mediations did not accurately state who they were representing. Therefore, our decision of the issue is appropriate.

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Utah Class Action Lawsuit alleges “THOUSANDS OF ILLEGAL UTAH FORECLOSURES”, Lawyers for Bank of America and ReconTrust sued

Utah Class Action Lawsuit alleges “THOUSANDS OF ILLEGAL UTAH FORECLOSURES”, Lawyers for Bank of America and ReconTrust sued


Salt Lake City, UT (UTAH NEWS) July 5, 2011

The Salt Lake City-based law firm Mumford West & Snow, LLC , today announced the filing of a class action lawsuit against the lawyers for Bank of America and its wholly own subsidiary ReconTrust, N.A. for conducting thousands of unauthorized foreclosures in the state. The lawsuit, filed in Utah’s Third Judicial District, is the latest development in an intense, ongoing legal battle in a state where the Utah legislature has recently enacted new civil penalties to assist aggrieved homeowners fighting illegal foreclosures and Utah’s Attorney General, Mark Shurtleff, publicly announced that ReconTrust was not in compliance with Utah law.

Lead counsel Marcus R. Mumford explained, “These parties have demonstrated a long standing pattern of illegal activity in taking thousands of homes from Utah homeowners in unauthorized foreclosures. They continue to kick people out of their homes claiming that they are not required to follow Utah law. We intend to put a stop to that.”

The lawsuit, now before Utah Third District Judge Andrew H. Stone, is the first class action suit filed after the recently enacted changes to Utah law. Attorney Tyson B. Snow explains, “We recently met with the Utah Attorney General’s office on this issue and it is our understanding that one of the purposes of the new law is to encourage this very type of lawsuit.” Mumford West & Snow attorneys also intend to seek a statewide restraining order and a preliminary injunction prohibiting the named defendants from conducting any additional foreclosure sales within the state.

Utah’s new law awards $2,000 or actual damages, whichever is greater, and attorney’s fees to homeowners who have been subject to an unauthorized foreclosure conducted by “unauthorized persons.” In the past month, ReconTrust has foreclosed on approximately 200 properties and currently has more than 800 foreclosure sales scheduled in the coming months. The newly filed lawsuit alleges that lawyers for Bank of America and ReconTrust violate Utah law each time they conduct these foreclosure sales. Utah homeowners who have been foreclosed on by ReconTrust or who may currently be facing a wrongful foreclosure can contact Mumford West & Snow through the firms website at http://www.mumfordwest.com

_______________________________

Mumford West & Snow (www.mumfordwest.com) is a Salt Lake City based firm that specializes in representing entrepreneurs, businessmen, executives and individual clients, in Utah and around the country, in complex civil and criminal litigation. The firm handles both defense work and plaintiff’s litigation for clients ranging from individuals and small enterprises to major corporations.

Mumford West & Snow has been called “one of Salt Lake City’s leading new firms in high-profile litigation.”


###


If you’d like more information about this release, or to schedule an interview with an attorney at Mumford West & Snow, please call 801-599-0020 or email contact@mumfordwest.com.

source: www.mumfordwest.com

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Banks high on list of delinquent property owners, Not certain they even own the homes?

Banks high on list of delinquent property owners, Not certain they even own the homes?


BOSTON GLOBE-

Two of the city’s top delinquent landlords are not landlords at all. They’re banks.

City officials said Wells Fargo & Co. and Bank of America owe more than $80,000 in fines for allowing many vacant properties in foreclosure to fall into disrepair and blight neighborhoods.

Yet both banks, two of the nation’s largest, question whether they are responsible for the properties and tickets. Wells Fargo representatives, for example, said they don’t even know if they own many of the homes; Wells Fargo could be servicing a foreclosure for another bank, or acting as a trustee for a giant pension fund that holds the mortgage.




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COMPLAINT | Glancy Binkow & Goldberg LLP Announces Class Action Lawsuit Against Bank of America Corporation

COMPLAINT | Glancy Binkow & Goldberg LLP Announces Class Action Lawsuit Against Bank of America Corporation


ANCHORAGE POLICE & FIRE RETIREMENT
SYSTEM, Individually and on Behalf of all Others
Similarly Situated
,

v.

BANK OF AMERICA CORPORATION, BRIAN
T. MOYNIHAN, CHARLES H. NOSKI,
KENNETH D. LEWIS, and JOSEPH L. PRICE

COMPLAINT FOR VIOLATION OF THE FEDERAL SECURITIES LAWS

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[Source: http://www.glancylaw.com/]

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WA State Judge Puts Hold on SJ “so-called beneficiaries like MERS” Pending Consumer Protection Act Outcome BAIN v. ONEWEST

WA State Judge Puts Hold on SJ “so-called beneficiaries like MERS” Pending Consumer Protection Act Outcome BAIN v. ONEWEST


KRISTEN BAIN, Plaintiff,
v.
ONEWEST BANK, F.S.B; DEUTSCHE BANK NATIONAL TRUST COMPANY; MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC; REGIONAL TRUSTEE SERVICES CORPORATION; Defendants.

Case No. C09-0149-JCC.

United States District Court, W.D. Washington, Seattle.

March 15, 2011.

Excerpt:

F. Consumer Protection Act

Finally, Plaintiff alleges that Defendants violated the Consumer Protection Act (“CPA”). To state a claim under the CPA, Plaintiff must show (1) an unfair or deceptive act or practice, (2) in trade or commerce, (3) that impacts the public interest, (4) which causes injury to the plaintiff in his or her business or property, and (5) which injury is causally linked to the unfair or deceptive act. Griffith v. Centex Real Estate Corp., 969 P.2d 486, 492 (Wash. Ct. App. 1998).

MERS asserts that Plaintiff has not shown an unfair or deceptive practice on its part, has not shown how any act of MERS impacts the public interest, and presents nothing showing injuries caused by an unfair or deceptive practice by MERS. The Court disagrees. Like her other claims arising under the Deed of Trust Act, Plaintiff’s CPA claims depend on whether MERS may be the beneficiary (or nominee of the beneficiary) under Washington state law. MERS’s attempt to serve as the beneficiary may have been improper under state law and it may have led to widespread confusion regarding home ownership, payment delivery, and negotiable positions. If MERS violated state law, its conduct may very well be classified as “unfair” under the CPA. There is no doubt that MERS’s conduct impacts the public interest. See Hangman Ridge Training Stables, Inc. v. Safeco Title Ins. Co., 719 P.2d 531, 537-38 (Wash. 1986) (listing factors for determining public interest); Peterson, supra, at 1362 (“Although MERS is a young company, 60 million mortgage loans are registered on its system.”); R. K. Arnold, Yes, There Is Life on MERS, 11 Prob. & Prop. 32, 33 (1997) (“Some have called MERS the most significant event for the mortgage industry since the formation of Fannie Mae and Freddie Mac. Others have compared it to the creation of uniform mortgage instruments, which have become standard throughout the residential mortgage industry. This suggests that the journey to MERS will have a tremendous effect on the mortgage industry.”). And the harm Plaintiff may have suffered because of MERS’s conduct may include expending resources to avert an unlawful foreclosure and preventing Plaintiff from identifying the real beneficiary and negotiating a new arrangement to avoid foreclosure.

The same reasoning applies to Regional, who also argued that Plaintiff cannot show an unfair or deceptive practice or show an impact on the public interest. Regional asserts that it acted appropriately because it was candid and forthcoming about its identity and its authority to conduct the foreclosure. That Regional was candid about its role is not dispositive. See Carlile v. Harbour Homes, Inc., 194 P.3d 280, 289 (Wash. Ct. App. 2008) (“An unfair or deceptive act or practice need not be intended to deceive, it need only have the capacity to deceive a substantial portion of the public.”). Moreover, just as MERS has its hands in countless home loans affecting the general public, so too does Regional play a key role in numerous foreclosure actions affecting the general public. MERS and Regional ultimately may bear no liability under the CPA, but this Court will await the state-court analysis before ruling on the parties’ motions for summary judgment.[5]

III. CONCLUSION

Plaintiff admits that she has been delinquent in her mortgage payments. A ruling favorable to Plaintiff in this case and others like it cannot and should not create a windfall for all homeowners to avoid upholding their end of the mortgage bargain—paying for their homes. But a homeowner’s failure to make payments cannot grant lenders, trustees, and so-called beneficiaries like MERS license to ignore state law and foreclose using any means necessary. Whether these and similar defendants complied with Washington state law remains unclear.

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WaPO | SEC moves to charge Fannie, Freddie execs

WaPO | SEC moves to charge Fannie, Freddie execs


The Securities and Exchange Commission is moving toward charging former and current Fannie Mae and Freddie Mac executives with violations related to the financial crisis, setting up a clash with the housing regulator that oversees the companies, according to sources familiar with the matter.

The SEC, responsible for enforcing securities laws, is alleging that at least four senior executives failed to provide necessary information to investors about the companies’ mortgage holdings as the U.S. housing market collapsed.

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NH BK Court Concludes WELLS FARGO “Violated TILA, Rescind Transaction, Award Damages” IN RE SOUSA

NH BK Court Concludes WELLS FARGO “Violated TILA, Rescind Transaction, Award Damages” IN RE SOUSA


Excerpt:


IV. CONCLUSION
The Court concludes that Wells Fargo violated TILA and the Sousas were therefore entitled to rescind the Transaction in July 2007. As a result of the violation and the rescission, Wells Fargo’s proof of claim is disallowed and the Sousas are entitled to damages. The Sousas are required to tender to Wells Fargo the actual money lent to them less any finance charges and payments they made to Wells Fargo on the loan. Accordingly, the Court shall grant Claim 1, deny Claim 2, deny as moot Claim 3, grant Claim 4, and grant Claim 5. Furthermore, the Court will grant Count I and Count II of Wells Fargo’s cross-claim against the Ginn Firm. This opinion constitutes the Court’s findings of fact and conclusions of law in accordance with Federal Rule of Bankruptcy Procedure 7052. The Court will issue a separate order and judgment consistent with this opinion.
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BOMBSHELL | Affidavit of Professor Ira Mark Bloom for U.S. Bank v. Congress

BOMBSHELL | Affidavit of Professor Ira Mark Bloom for U.S. Bank v. Congress


Affidavit of Professor Ira Mark Bloom for U.S. Bank v. Congress

A Must Read…

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US House Committee on Veterans’ Affairs Hearing Today: Alleged Violations of the Servicemembers Civil Relief Act (SCRA)

US House Committee on Veterans’ Affairs Hearing Today: Alleged Violations of the Servicemembers Civil Relief Act (SCRA)


VIOLATIONS OF MILITARY MORTGAGE/FORECLOSURE PROTECTIONS

Alleged Violations of the Servicemembers Civil Relief Act (SCRA)

February 9, 2011

Alleged Violations of the Servicemembers Civil Relief Act (SCRA)

Opening Statements

Witness Testimonies

PANEL 1

PANEL 2

  • Stephanie B. Mudick, Executive Vice President, Office of Consumer Practices, JPMorgan Chase & Co., New York, NY

PANEL 3

  • Colonel Shawn Shumake (USA), Director, Office of Legal Policy, Office of the Deputy Under Secretary of Defense, U.S. Department of Defense
  • Hollister K. Petraeus, Team Lead, Office of Servicemember Affairs, Consumer Financial Protection Bureau Implementation Team, U.S. Department of the Treasury

PANEL 4

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Strauss & Troy Investigates HSBC Bank and Citi Mortgage “ROBO SIGNERS, HAMP”

Strauss & Troy Investigates HSBC Bank and Citi Mortgage “ROBO SIGNERS, HAMP”


Source: Strauss & Troy
Strauss & Troy Investigates HSBC Bank and Citi Mortgage

CINCINNATI, Dec. 1, 2010 (GLOBE NEWSWIRE) — The Cincinnati law firm of Strauss & Troy announced today that it is investigating HSBC Bank and Citi Mortgage for potential violations of state and federal law with regard to foreclosures initiated against homeowners participating in the Home Affordable Modification Program (HAMP) and/or robo-signers who initiated foreclosure actions without adequately reviewing the filings. Strauss & Troy represents homeowners in a pending action against a bank for alleged violations of HAMP.

Individuals who have lost their homes in a foreclosure action or are currently in foreclosure initiated by HSBC or Citi Mortgage: (i) after making payments pursuant to a trial HAMP payment plan that was not made permanent, or (ii) as a result of robo-signers who initiated foreclosure actions without adequately reviewing the filings, may have a claim and are encouraged to contact attorneys Richard Wayne, William Flynn, or John Levy at (513) 621-2120, or by email at: rswayne@strausstroy.com, wkflynn@strausstroy.com or jmlevy@strausstroy.com for further information without any obligation or cost to you.

CONTACT:  Strauss & Troy
Richard Wayne, Esq.
William Flynn, Esq.
John Levy, Esq.
(513) 621-2120
1-800-669-9341
Cincinnati, Ohio  45202

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



Posted in STOP FORECLOSURE FRAUDComments (1)

FL 4th DCA APPEALS COURT: “ATTORNEY FEES AWARDED” VALCARCEL v. CHASE BANK

FL 4th DCA APPEALS COURT: “ATTORNEY FEES AWARDED” VALCARCEL v. CHASE BANK


DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT

July Term 2010

CARMEN VALCARCEL and VICTOR VALCARCEL,
Appellants,
v.
CHASE BANK USA NA,
Appellee.

No. 4D10-379

[November 24, 2010]

TOWBIN SINGER, MICHELE, Associate Judge.

EXCERPTS:

The trial court granted the Valcarcels’ motion to dismiss as a sanction against Chase for sending a letter regarding the Valcarcels’ mortgage directly to the Valcarcels, rather than the Valcarcels’ lawyer. This mailing was a violation of rule 1.080(b), which requires service to be made upon a party’s attorney when he is represented by counsel.

Florida Rule of Civil Procedure 1.420(b) provides in pertinent part: “(b) Involuntary Dismissal. Any party may move for dismissal of an action or of any claim against that party for failure of an adverse party to comply with these rules or any order of court.” Rule 1.420(d) provides: “(d) Costs. Costs in any action dismissed under this rule shall be assessed and judgment for costs entered in that action.”

The trial court erred in denying the Valcarcels’ motion for attorney’s fees and costs based upon its finding that the order was not a judgment. Although the dismissal order was not an adjudication on the merits, the Valcarcels can nonetheless be considered the prevailing party. They are entitled to an award of attorney’s fees because the action against them was dismissed. We, therefore, reverse and remand to the trial court to determine the amount of attorney’s fees that should be awarded to the Valcarcels for both the trial and appellate proceedings.

Reversed and Remanded.

Valcarcel v Chase

[ipaper docId=44312420 access_key=key-oba0qz31mu3naz6701a height=600 width=600 /]

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



Posted in STOP FORECLOSURE FRAUDComments (0)

FL 3rd DCA Appeals Court: “Process Service” OPELLA vs. Bayview Loan Servicing, LLC

FL 3rd DCA Appeals Court: “Process Service” OPELLA vs. Bayview Loan Servicing, LLC


No. 3D09-2921
Lower Tribunal No. 09-12657
________________
Steven Ray Opella,
Appellant,

vs.
Bayview Loan Servicing, LLC.,
Appellee.

An Appeal from the Circuit Court for Miami-Dade County, Thomas S. Wilson, Jr., Judge.

Steven Ray Opella, in proper person.
Popkin & Rosaler, Brian L. Rosaler, Richard P. Cohn and Deborah Posner,
(Deerfield Beach), for appellee.

Before GERSTEN, WELLS, and LAGOA, JJ.WELLS, Judge.

Steven Ray Opella appeals from a final summary judgment of foreclosure
entered in favor of Bayview Loan Servicing, LLC., claiming that he was never
served with process. Because the record unequivocally confirms that Opella was
neither served with process nor waived service, we reverse.

We also direct the clerk to forward a copy of this opinion to the Florida Bar for
consideration of conduct in violation of the Rules Regulating the Florida Bar.

OPELLA v. BAYVIEW

[ipaper docId=44090710 access_key=key-21vih0nl37kze5ce309q height=600 width=600 /]

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



Posted in STOP FORECLOSURE FRAUDComments (3)

Lord Have ‘MERScy’, Lenders Brace Yourselves

Lord Have ‘MERScy’, Lenders Brace Yourselves


JPMorgan, Bank of America Face `Hydra’ of State Foreclosure Investigations

By Margaret Cronin Fisk – Oct 6, 2010 12:01 AM ET

JPMorgan Chase & Co., Bank of America Corp. and Ally Financial Inc., defending allegations of fraudulent home foreclosures from customers and Congress, may face the most financial peril from investigations by state attorneys general.

Authorities in at least seven states are probing whether lenders used false documents and signatures to justify hundreds of thousands of foreclosures, and the number of these inquiries will grow, according to state officials and legal experts.

“You’re going to see a tremendous amount of activity with all the AGs in the U.S.,” Ohio Attorney General Richard Cordray said in an interview. “We have a high degree of skepticism that the corners that were cut are truly legal.”

JPMorgan, Bank of America and Ally have curtailed foreclosures or evictions in 23 states where courts have jurisdiction over home seizures.

While homeowners in those states and elsewhere must usually show damages to win a lawsuit, “attorneys general can just sue over deceptive sales practices and get penalties,” said Christopher Peterson, a University of Utah law professor who specializes in commercial and contract law.

In Ohio, penalties include fines up to $25,000 per violation, with each false affidavit or document considered a violation, according to state law enforcement officials. In Iowa, fines rise to a maximum of $40,000 for each violation.

Foreclosure Freeze

This penalty would apply to “every instance of an affidavit that was filed improperly or every time facts were attested to that weren’t true,” said Cordray. His counterpart in Connecticut, Richard Blumenthal, has called for a freeze on foreclosures and said the submissions are a “possible fraud on the court.”

Officials in Ohio and Connecticut, along with Florida, Texas, North Carolina, Iowa and Illinois, said they are investigating mortgage foreclosure practices.

Continue reading …BLOOMBERG

.

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



Posted in assignment of mortgage, foreclosure, foreclosure fraud, foreclosure mills, foreclosures, forgery, MERS, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC., STOP FORECLOSURE FRAUDComments (3)

15 Texans File Class action suit against Bank of America

15 Texans File Class action suit against Bank of America


By Lani Rosales on July 15, 2010 | AgentGenius.com

Here at AG, we’ve written about how Bank of America has foreclosed on homes by continuing the foreclosure process even after the home was successfully sold to a new buyer who didn’t even have a loan through Bank of America and we’ve covered how they have foreclosed on addresses they never even had a loan on despite dispute and direct correspondence.

AG columnist, Russell Shaw has remained our most vocal advocate for homeowners and agents having to battle Bank of America. His “Bank of America retard division for short sales” article that outlines the unfair, irrational and possibly illegal behavior of Bank of America remains one of the most read articles here at AG on most days, almost a year after it was originally published.

In steps the Texans

We’ve awaited the day that someone stood up to the documented abuses in a fashion that would impact Bank of America’s bottom line, and today, a group of homeowners are no longer taking it lying down. In true Texas fashion, a class action complaint was just filed and a jury trial has been demanded. Today,
the Texas Housing Justice League joins the 15 homeowners in the suit against Bank of America and its subsidiary BAC Home Loans Servicing.

Interestingly, the claim is using RESPA (Real Estate Settlement and Procedures Act) as grounds for the complaint. The other eight claims are as listed below:

  • Count Two: Breach of Contract – Loan Modification Agreement
  • Count Three: Breach of Contract – Forbearance Agreement
  • Count Four: Breach of Contract-Promissory Note and Deed of Trust
  • Count Five: Violation of the Texas Property Code
  • Count Six: Breach of Oral Contract-HAMP Trial Modification
  • Count Seven: Unreasonable Collection Efforts
  • Count Eight: Intentional Misrepresentation
  • Count Nine: Texas Debt Collection Act

About the plaintiffs:

According to the Texas Housing Justice League, “Plaintiffs are and represent people who purchased their first homes between 1994 and 2006, usually with loan assistance from the Federal Housing Administration and the U.S. Department of Veterans Affairs. Their loans were all serviced by Defendant BAC, which is a wholly owned subsidiary of Defendant Bank of America, N.A.”

They continue, by noting that “The lawsuit complains not of poor customer service by BAC, but of a systematic home loan servicing scheme that includes hours of telephone runaround, misleading and inconsistent information, lost correspondence, verbal abuse, and extensive delay, all of which have documented costs not only in terms of money, but in health. The facts in this case reveal the harsh reality that underlies the loan servicer’s press statements about loan modifications and forbearance agreements following collapse of the U.S. housing market.”

A suitable summary of the suit:

Denver Realtor, Kristal Kraft says, “In the interest of time, I will now use only the keywords describing the gripes against Bank of America as accused by the Texas Homeowners.

Scheme, misleading, inconsistent, lost correspondence, verbal abuse, extensive delay, money, health, harsh, shuffled, no resolution, dysfunctional, barrage of misinformation, misdirection, deliberate inactivity, abuse, harassment, yo-yo. blocked at every turn, labyrinth of transfers, hundreds of hours on the telephone, transferred, never speak to same person again, contradictions, complaints meet with resistance, no supervisors available, unaccountable departments, asked to sign same documents three, four or even five times, negotiators who would not return telephone calls, not isolated incidents, pattern and practice by Bank of America.’

What will happen next?

One of the Plaintiff’s lawyers, Robert Doggett said on ForeclosureBuzz.com, “It would be hard to imagine that Bank of America and BAC will fight the facts of the case; the question will likely be whether they can get away with it. The servicer will likely claim that poor “customer service” is something that must be accepted like a slow waiter or a bad movie. The difference is of course that homeowners are not merely customers that should expect to be mistreated and lied to — homeowners have a contract with the holder of their home loan and these servicers are the agents for the holder — and moreover, servicing a home loan is not in the realm of someone forgetting your fries or being tricked into seeing Gigli.”

For the full claim, click here.

[ipaper docId=34367809 access_key=key-22j3ru34s5q8ixwyzrmc height=600 width=600 /]


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



Posted in bank of america, class action, respa, STOP FORECLOSURE FRAUD, ViolationsComments (5)

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