“The borrower owes money not to the world at large but to a particular person or institution, and only the person or institution entitled to payment may enforce the debt by foreclosing on the security.”
“[O]nly the entity currently entitled to enforce a debt may foreclose on the mortgage or deed of trust securing that debt . . . .” (Yvanova, supra, 62 Cal.4th at p. 928.). The court was not influenced by the creation of a false assignment post-foreclosure sale, and ruled according to the recorded documents.”
THE FOLLOWING ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
Kudos to the attorney Stephen F. Lopez who handled this case at both the trial and appellate level.
The Supreme Court of California in Yvanova opened another door to stop a wrongful nonjudicial foreclosure case in California. Apparently the California Appeal courts are starting to see through the false claims and false arguments that Banks have been using for years to wrongfully foreclose. The Sciarratta decision confirms the standing rule in Yvanova: “The borrower owes money not to the world at large but to a particular person or institution, and only the person or institution entitled to payment may enforce the debt by foreclosing on the security.”
The old argument that has been parroted thousands of times by Judges across the country has been trashed: “What difference does it make who the money is owed to, the Borrower is in default” There are so many things wrong with that statement but I’ll limit it to two: (1) That statement opens the door to a fraudulent industry that all the banks ran through — claim a debt and then collect on it and (2) how can there be a legal default to someone you don’t owe any money to?
In Sciarratta v. U.S. Bank, Monica Sciarratta alleged that because of a void assignment (void not voidable) of her promissory note and deed of trust that the party (Bank of America) attempting to foreclose on her home had no interest in the underlying debt or the property and therefore should be barred from foreclosing. This case exemplifies what courts should do when confronted with factual evidence, to wit: no court should arrogate jurisdiction to themselves — making up facts and then applying erroneous presumptions in favor of a bank who is using deceptive tactics to steal a home. As the Appeal Court ruled, “When a non-debt holder forecloses, a homeowner is harmed by losing her home to an entity with no legal right to take it.” It is pathetic that an Appeal court must point this out, but obviously they thought the lower court might not understand the take away message: A homeowner is harmed when an entity with no right to take it, takes it.
The court held to basic principles of law, complied with the Yvanova standing ruling and expanded into issues of prejudice and wrongful foreclosure. Sciarratta proclaimed that since her Note was assigned to Deutsche Bank from Chase according to recorded documents, Chase could not also assign their interest to Bank of America after they had already conveyed their interest to Deutsche and therefore the assignment was void. Bank of America had no right to foreclose or make a credit bid- despite the fact that they filed a slick “corrective assignment” a month AFTER the non-judicial foreclosure. The Appeal court confirmed our point stating, “[O]nly the entity currently entitled to enforce a debt may foreclose on the mortgage or deed of trust securing that debt . . . .” (Yvanova, supra, 62 Cal.4th at p. 928.). The court was not influenced by the creation of a false assignment post-foreclosure sale, and ruled according to the recorded documents.
Although the Yvanova v. New Century Mortgage Corp., (62 Cal.4th 919 (2016)), decided that a homeowner has standing to sue for wrongful foreclosure, Yvanova did not address “any of the substantive elements of the wrongful foreclosure tort,” and did not address “prejudice . . . as an element of wrongful foreclosure.”
The Court of Appeal found that, “[A] homeowner who has been foreclosed on by one with no right to do so -by those facts alone- sustains prejudice or harm sufficient to constitute a cause of action for wrongful foreclosure. When a non-debt holder forecloses, a homeowner is harmed by losing her home to an entity with no legal right to take it. Therefore under those circumstances, the void assignment is the proximate cause of actual injury and all that is required to be alleged to satisfy the element of prejudice or harm in a wrongful foreclosure cause of action.”
The opinion stated that, “The potential consequences of wrongfully evicting homeowners are too severe to allow such a result.” The court concluded that “a homeowner who has been foreclosed on by one with no right to do so—by those facts alone—sustains prejudice or harm sufficient to constitute a cause of action for wrongful foreclosure. When a non-debt holder forecloses, a homeowner is harmed by losing her home to an entity with no legal right to take it.” Therefore, the homeowner does not need to allege prejudice or harm- it is a given in a wrongful foreclosure. It is unconscionable that most courts don’t seem to grasp this simple legal maximum: If you don’t own it- you can’t have it. Boom. End of discussion.
The Court of Appeal reversed the judgment of dismissal entered after the trial court erroneously sustained a demurrer to Sciarratta’s first amended complaint without leave to amend, and remanded for further proceedings. We will see how the trial court responds to this ruling.
My concluding comment is that the courts have been running wild under the directive to protect the bank and our financial system. That is not the job of the courts. The judiciary is and was always intended to be a separate branch of government that served to check and balance the power of the legislative and executive branches of government. It was never intended that the courts should do the bidding of either of the other branches of government.
It was always the intent that courts should apply common law precedent and properly enacted statutes. Had they done so there is sufficient evidence in the “settlements” and all the decisions in which the homeowners won their case to presume that most of the foreclosures were wrongful and fraudulent.
Had the Courts spent their time demanding evidence instead of assuming facts that were (a) not in evidence and (b) untrue, millions of homeowners would still be in their homes and millions of beneficiaries of managed funds would not be facing reductions in pensions caused by the theft of their money by Wall Street banks.
The remedy is and always has been a direct interaction between investors and borrowers, albeit through associations or agencies that truly represented the interests of both sides. “Servicers” and “trustees” should be removed from their role as volunteer intermediaries, having no authority to service loans nor represent the interests of investors. That has produced the effect of minimizing the amount received by investors and maximizing the “profit” of the banks acting as “Master Servicers,” “Trustees” and “underwriters.” As it stands, the theft goes on and investors are being coerced into settlements with investment banks that are telling them that it doesn’t matter what they did. In the meanwhile the theft continues.
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