Ocwen Admission Confounds Judges and Experts

This is a blatant attempt at deception  — a deceit without which none of the Trusts would be recognized as legal entities much less the owner of loans. Ocwen is admitting that there is no single owner of the loan it is allegedly “servicing.” “There is no single owner of the account, but rather the account is one of many in a securitized investment trust.”

For the uninitiated, this statement might suffice or at least be threatening enough as a challenge to their experience and intelligence to direct them away from the central false assertion that the trusts own any loan. They don’t.

Let us help you prepare for deposition or trial: 202-838-6345
Get a consult and TEAR (Title & Encumbrances Analysis and & Report) 202-838-6345. The TEAR replaces and greatly enhances the former COTA (Chain of Title Analysis, including a one page summary of Title History and Gaps).
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THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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Hat Tip Bill Paatalo

see Ocwen Responsive Letter – CFPB – 11-03-2017

In this real live case, Ocwen is fulfilling its job that includes obfuscation as one of its paramount duties. After first “answering” the CFPB requests with obfuscation it then states “The ownership status of the account is based upon our review of our records as of the date of this letter.” It doesn’t say that the information is correct or even believed to be correct. It doesn’t say they performed due diligence to determine whether a true chain of ownership exists, combing the various records of “predecessors.”

Nor is there a statement that Ocwen is authorized to service the account. It simply says that it IS servicing the account. And of course then they do not assert the basis of their authority since they never asserted their authority. It is implied. It is assumed. In court, it might well be presumed by the court, the foreclosure mill attorney and even by the borrower and the borrower’s attorney. This is one of the errors that snatches defeat from the jaws of victory. An attack on what is missing instead of trying to dodge what is there would result in far more victories for homeowners.

The attorney’s client is Ocwen. Ocwen is impliedly asserting authority to service but can’t show it. In one recent case of mine, they came in with a Power of Attorney signed by someone who purportedly executed the instrument on behalf of Chase. The problem was that Chase was never mentioned before in any pleading, documents or testimony. The POA was false.

Back to ownership: “there is no single owner” implies that there are many owners. There are several problems with that assertion or implication that involve outright lying. Ocwen is saying that the loan is in a securitized investment trust which certainly would imply that the loan is not in transit nor is it owned by more than one trust.

Further if the reference (omitted) is to investors, that too is a lie in most cases. The certificate indenture usually contains the express statement that the holder of the certificate receives no right, title or interest to the debt, note or mortgage in “underlying” loans (which have never been acquired by the trust anyway).

So what are we left with? No single owner which means that the securitized investment trust doesn’t own it because that is one single entity. Multiple owners does not refer to investors because the express provisions on their certificates say they have no ownership of the debt, note or mortgage in the alleged loan.

The counterintuitive answer is that the bank’s are saying there is no owner. But there is an owner. It is a group of investors whose money was used to fund or acquire the loan. This was not done through any trust, as they intended and as was required by the “securitization” documents. If that was the case then the trust would have been named as lender or as holder in due course. That never happened.

But the holders of worthless securities can claim an equitable interest in the loan and perhaps even the collateral. In order to establish that interest the investors must go to a court of competent jurisdiction. But in order to do that the investors must know about the specific loan transaction(s), which they don’t. The fact that they don’t know about it and can’t exercise their rights does not mean that legally, anyone can intervene and assert ownership rights.

Ten years ago I said get rid of the current servicers and stick a government agency in as intermediary so that investors, as real parties in interest and borrowers as real parties in interest could do what the lending industry normally does best — work this out so that nobody loses everything and nobody gets a windfall. This could have all been over years ago and the impact on the economy would have been a powerful stimulus leaving no inherent weakness in our economy or our currency.

Unfortunately the courts strayed from making legal decisions and instead made a political decision to save the banking industry at the expense of homeowners.

 

 

 

Wells Fargo, Ocwen and Fake REMIC Trust Crash on Standing

What is surprising about this case is that there was any appeal. The trial court had no choice but to dismiss the foreclosure claim.

  1. A copy of the note without an indorsement was attached to the complaint. This leads to the presumption that the indorsement was attached after the complaint was filed. Standing must be proven to ex isa at the time the suit was filed.
  2. The robo-witness could have testified as to the date the indorsement was affixed but he said he didn’t know.
  3. The robo-witness was unable to testify that the default letter had been sent.
  4. It didn’t help that the foreclosure case had been brought before by two different parties and then dismissed.
  5. Attorneys attempted to admit into evidence an unsigned Pooling and Servicing Agreement that could not be authenticated and was merely “a copy of a printout obtained from the SEC website”. This is an example of how court’s are rejecting the SEC website as a government document subject to judicial notice or even introduction into evidence without competent testimony providing the foundation for introducing the PSA for a fake trust.
Let us analyze your case and give you ammunition for the court battle: 202-838-6345
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THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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see Wells Fargo, as trustee v Madl

Note that the style of the case shows that Wells Fargo was never the Plaintiff. The purported or implied trust was the named Plaintiff. But as Wells Fargo explained in its own article, the Trust is not the Plaintiff and neither are the certificate holders the Plaintiff because their certificates most often expressly state that the holder of the certificate does NOT have any right, title or interest in the “underlying” loans.

In fact if you read it carefully you will see that no trust is actually named or mentioned. AND the failure of the “trust instrument” (the PSA) shows that the trust was never created and never existed. An unsigned, incomplete document downloaded from a site (SEC.gov) that anyone can access to upload documents is not evidence.

DEUTSCH BANK Memo Reveals Documents and Policies Ripe for Discovery

This completely corroborates what I have been saying for years along with a chorus of lawyers and pro se litigants across the county. It simply is not true that the attorney represents the trust or the trustee. 

This “Advisory” shows that there are documents that are rarely in the limelight and that clarify claims of securitization in practice. Note that the memorandum cited below comes from Deutsch Bank National Trust Company, as trustee and Deutsch Bank Trust Company Americas, as trustee.

These names are often NOT used when foreclosure actions are initiated where the name of the alleged REMIC Trustee is Deutsch Bank. It is important to note that neither of the two trust entities actually have been entrusted with any loans on behalf of any trust. Their name is used, for a fee, as windows dressing.

In this memo, Deutsch is attempting to limit its liability beyond the absence of any duties or trustee powers whose absence is revealed by reading the Pooling and Servicing Agreement (PSA) which is the alleged Trust instrument.

Let us help you plan your discovery requests: 202-838-6345
Get a consult and TEAR (Title & Encumbrances Analysis and & Report) 202-838-6345. The TEAR replaces and greatly enhances the former COTA (Chain of Title Analysis, including a one page summary of Title History and Gaps).
https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments. It’s better than calling!
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
—————-

Hat tip to Bill Paatalo

See Deutsche Bank Memorandum – July 2008

I have previously published and commented on parts of this memorandum. This is an expansion on my comments. This “advisory” obviously intends to bring alleged servicers back in line because it states in the introductory paragraph that the Trustee respectfully requests that all servicers review the First Servicing Memorandum and adhere to the practices it describes.”

None of this would have been necessary if the servicers were conforming to the directions and restrictions contained in the First Servicing Memorandum. We all know now that they were not conforming to anything or accepting instruction from anyone other than the alleged “Master Servicers” for NEITs (nonexistent  inactive trusts).

In discovery, one should ask for any servicer memoranda that exist including but not limited to the Memorandum to Securitization Loan Servicers dated August 30, 2007 a/k/a the First Servicer Memorandum, and all subsequent correspondence or written directions to servicers including but not limited to this “Advisory Concerning Servicing Issues Affecting Securitized Housing Assets.

Note also the oblique reference to the fact that the cut-off date actually means something.  It states that “typically” the REMICs (actually NEITs) take ownership of loans at the time the securitization trusts are formed. Thus discovery would include questions as to whether or not that occurred and if not, when did transfer of ownership occur and with what parties. Also one would ask for correspondence and agreements attendant to the alleged “transaction” in which the Trust allegedly purchased the loans with trust money that came from the proceeds of sales of certificates to investors. If the Trust did not pay value for the loans then it did not acquire the debt. It only acquired the paper instruments that are used as evidence of the debt.

Perhaps most importantly, the memo comes down hard on the use of powers of attorney, which are a favorite medium through which lawyers for the foreclosing parties typically try to patch obvious gaps in the chain of ownership or custody of the loan documents.

Then the memo provides foreclosure defense attorneys with the opportunity to attack the foundation laid for testimony and exhibits from robo-witnesses. It states that all parties must “Understand the mechanics of of relevant securitization transactions and related custodial practices in sufficient details to address such questions in a timely and accurate manner.” As any foreclosure defense lawyer will tell you, the robo-witness knows nothing about “the mechanics of of relevant securitization transactions and related custodial practices.” [The problem is that most borrowers and foreclosure defense lawyers don’t know either].

The inability of the robo-witness to describe the specific securitization practices in real life as it pertains to the subject loan gives rise to a cogent attack on the foundation for the rest of his testimony. With proper objections, perhaps motions in limine, and cross examination, this could lead to a defensive motion to strike the witnesses testimony and exhibits for lack of foundation. The following quote takes this out of the realm of theory and argument and into simple fact:

Servicers must ensure that loss mitigation personnel and professionals engaged by servicers, including legal counsel retained by servicers, understand the mechanics of relevant securitization transactions and related custodial practices in sufficient details to address such questions in a timely and accurate manner. In particular, servicing professionals [including “loss mitigation”] must become sufficiently familiar with the terms of the relevant securitization documents for each Trust for which they act to explain, and where necessary, prove those terms and resulting ownership interests to courts and government agencies.”

Note the assumption that lawyers are hired by servicers and not the Trustee or the Trust. Thus the servicers hire counsel and then order that foreclosure be brought in the name of the alleged trust. But if there is no trust or no acquisition of the debt, or authorization (remember powers of attorneys are not sufficient), the servicer is without legal authority to do anything, much less collect money from homeowners or bring foreclosure actions.

Paragraph (2) of the this “advisory” also gives guidance and foundation for what various people, especially attorneys, can say about who they represent and how.

“The Trustee believes that all persons retained by the servicer should specifically role or capacity in which they are acting. … One would be less accurate… if he or she claimed to be … attorney for the Trustee. A more accurate statement [attorney for servicer] acting for [Deutsch] as trustee of the Trust.”

This completely corroborates what I have been saying for years along with a chorus of lawyers and pro se litigants across the county. It simply is not true that the attorney represents the trust or the trustee.

 

Fact Check: Robo-witness knows nothing

Information is admitted in evidence only after a proper foundation has been laid. If the witness knows nothing about the foundation the evidence should not be admitted as evidence. Appellate courts will usually reverse a trial court’s error in ruling on evidence UNLESS the appellate panel decides that the error would not have made any difference in the outcome. The fundamental fact at the root of all foreclosures is that the homeowner owes a debt to the foreclosing party and has not paid.

In the passage below a witness supposedly employed by US Bank displays a lack of personal knowledge on anything that would contribute to foundation for establishing the standing of the foreclosing party. I have inserted in brackets the significance of each answer of an actual witness in a court proceeding.

Let us help you prepare for deposition or trial: 202-838-6345
Get a consult and TEAR (Title & Encumbrances Analysis and & Report) 202-838-6345. The TEAR replaces and greatly enhances the former COTA (Chain of Title Analysis, including a one page summary of Title History and Gaps).
https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments. It’s better than calling!
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
—————-

Hat tip Bill Paatalo

Videoconference deposition of JOHN G. RICHARDS,II

Would you please provide your official title for
11 the record.
12 A Yes, I’m the vice president at U.S. Bank within
13 the global corporate trust services group. [The problem that was overlooked here is that his title is not foundation for establishing the existence of a trust that is managed by US Bank as Trustee. Additional questions regarding the existence of any account that is under trust management by US Bank would have revealed lack of knowledge because the witnesses are not given any information that could be used by the homeowner or counsel for the homeowner. In truths I have repeatedly pointed out, if you proceed under the assumption that there is no “account” in existence under which Trust assets are managed for the benefit of beneficiaries, all the pieces fall into place. There is no Trustee because there is nothing that has been entrusted to the trustee for the benefit of beneficiaries. Thus parties claiming authority “from the Trust” to serve as services or master servicers lack any foundation to support the assertion of that authority. This is why no modification is signed by anyone other than the servicer acting as attorney in fact for the purported Trust or other foreclosing party.]

——————

Q I see. Do you know who the beneficiaries are of

10 the WaMu trust?

11 A I do not know the specific beneficiaries — or I

12 would call them certificate holders. I don’t know the

13 identity of those investors or certificate holders. [Here is US Bank whom the attorneys have named as the foreclosing party. The witness is supposedly someone who knows about the USB trust arrangement for a REMIC Trust. Yet on the most basic questions about the existence of a trust — the existence of beneficiaries, he is unable to answer the question regarding their identity. A trust without beneficiaries is not a trust   — i.e., it is not an legal entity. In fact he is saying that there are no beneficiaries but that there are certificate holders. He can’t identify either the beneficiaries or the certificate holders. Note also that he knows nothing about the “certificates, which in most cases expressly state that the holder is NOT entitled to an interest in the loan, debt, note or mortgage. What they have is a promise to pay them money coming from a nonexistent trust.]

14 Q That’s fine. And because you don’t know, do you

15 know who would know or is there a list?

16 A I do not know specifically if there is a list

17 that would have the names of actual individuals or

18 entities who are certificate holders. [This further erodes the foundation for proving that the trust exists, the beneficiaries exist or the certificate holders exist. More importantly it is an admission that even a list of the certificate holders might not exist — thus corroborating a central point on this blog — that the money never went into the trust and that instead it was commingled with the money of other investors in a different entity altogether. I have referred to this scenario as a dark pool or slush fund in which the underwriting banks (who appoint themselves as Master Servicers) take charge of the investor funds instead of the money being administered by a Trust. Remember that in 2008-2009, the banks and servicers were asserting that such Trusts did not exist. That was probably a true statement in that the Trust was never an active trust and the trustee was never an active trustee.] 

19 It is common for many of these certificates to

20 be held. I’m not sure the exact way to hold it, but

21 something that is significant amount to brokerage or some

22 other place for the general holding of investment

23 securities. [He is referring to the practice of holding securities in street name — i.e., in the name of the brokerage house that allegedly completed the transaction on behalf of the investor. This enables the investment banking entity to assert ownership of the certificates for title purposes while supposedly holding the certificates for investors, the only evidence of which would be the end of month brokerage statement telling the investors that they own the rights to certificates even though the certificates are not in their name. Of course the rub here is that most certificates are uncertificated — merely computer entries. But that doesn’t mean that there isn’t a master certificate in electronic or paper form. The witness is saying he doesn’t know where such certificates are held, by whom or for what purpose] It’s a company called DTC that serves that

24 function just generally in the industry. But I don’t

25 have information about the identity of the specific certificate holders.

2 Q So you’re saying that this entity, DTC, holds

3 that information who would know?

4 MS. DARNELL: Objection. Calls for speculation.

5 THE WITNESS: I don’t know. I think I’m using

6 that as an example of sort of how these certificates are

7 commonly held and the entity that might be positioned to

8 communicate with actual certificate holders.

Q So does the trust actually communicate directly

11 with the certificate holders?

12 A I am not familiar with the — with any direct

13 communication between U.S. Bank as trustee for this trust

14 and certificate holders on an individual basis. I’m not

15 familiar with that at all. [This is as close as you will get to the admission that there is no active Trustee and there is no active Trust. If there is no communication or no knowledge of communication between the Trustee and the certificate holders then it is an inescapable conclusion that there is no activity in the alleged REMIC Trust. If there was such activity within the Trust it would need to be disclosed to the “beneficiaries” or “certificate holders.” There isn’t. The master servicer sends out a distribution report with the disclaimer that none of the information on the distribution report has been verified and could be entirely wrong.]

———————

23 Q So with respect to it being vague and

24 ambiguous — and I just want to clarify. Do you manage

25 Chase as the servicer of the trust?

A I would not describe that there is any kind of

2 management or oversight role by the trustee of a servicer

3 in this trust or any other. [So the party claimed to be the servicer is not managed by and need not report to the party named as the Trustee — thus further establishing that the Trustee is inactive and the “trust” is a sham. If there is no “kind of management or oversight role by the trustee of a servicer” then who directs the “servicer” on the distribution of the money collected from homeowners? Some document must exist that is not being produced in court. It would be a document that establishes the duties and responsibilities of the subservicer. It would be executed by the “Servicer” and the Master Servicer but kept secret because the document would establish, once and for all, that for all purposes other than foreclosure the parties conduct business as though the trust did not exist.]

Given the above testimony and commentary, the testimony of the witness should not be admitted into evidence at trial. The reason is lack of foundation. Proper objections on foundation, leading, and hearsay must be repeatedly raised or else the testimony, however riddled with untruth, will be admitted because the objection was” waived” by failing to raise it timely. If the objections are sustained and the witness has managed to spew out an answer as you were objecting then a motion to strike is absolutely required lest the objectionable testimony remain in the record. As Plan B, bring these things out in cross examination and then move to strike the testimony.

 

 

Trustee v Active Trustee US Bank Fails to show or even attempt to show it is an active trustee

CASE DISMISSED,WITH LEAVE TO AMEND. US BANK DECLINED TO AMEND. CASE DISMISSED.

Even where there is a clerk’s default “The burden is on the plaintiff to establish its entitlement to recovery.” Bravado Int’l, 655 F. Supp. 2d at 189.

Here is an example of how lawyers purport to represent US Bank when in fact they are creating the illusion that they represent a trust and in reality they are representing a subservicer who is receiving orders from a master servicer of a nonexistent trust. As Trustee of the nonexistent trust USB had no active role in the nonexistent trust. As the inactive Trustee for a nonexistent Trust, no right, title or interest in the debts of homeowners were within any scope of authority of any servicer, subservicer or master servicer. Each foreclosure is a farce based upon assumptions and presumptions that are exactly opposite to the truth.

Given the opportunity to amend the complaint, lawyers for USB chose not to amend — because they could not plead nor prove the required elements of an active trustee. Because of that USB lacked standing to bring the action except as agent for an active trust or on behalf of the trust beneficiaries. But where the certificates show that the certificate holders do NOT have any interest in a mortgage or note (true in about 70% of all cases), then they too lack of standing. And if the Trust is not an active Trust owning the debt, note or mortgage then it too lacks standing.

Let us draft your motions and do the research necessary to draw the attention of the court to the fraud taking place under their noses. 202-838-6345
Get a consult and TEAR (Title & Encumbrances Analysis and & Report) 202-838-6345. The TEAR replaces and greatly enhances the former COTA (Chain of Title Analysis, including a one page summary of Title History and Gaps).
https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments. It’s better than calling!
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
—————-

Hat tip Bill Paatalo

see Memorandum and Order – USBank Trust NA as Trustee for LSF9 MPT v Monroe

See Judgment – USB Trust for LSF9 v Monroe –

While this case discusses diversity and other issues concerning US Bank “as trustee” the reasoning and ruling clearly expose the truth about pleading irregularities by attorneys who purport to represent US Bank or a REMIC Trust.

A debt is an asset to anyone who owns it. Industry practice requires that for transfer of ownership, there must be an agreement or other document providing warranty of title, confirmation of the existence and ownership of the debt and proof of authority of the person executing the document. Go into any bank and try to borrow money using a note as collateral. The bank will require, at a minimum, that the debt be confirmed (usually by the purported debtor) and that each party in the chain show proof of purchase.

Without consideration, the assignment of mortgage or endorsement of the note is just a piece of paper.

When there is an assertion of ownership of the loan, what the banks and so-called servicers are actually saying is that they own the paper (note and mortgage) not the debt. In the past this was a distinction without a difference. In the era of patently f false claims of securitization, the debt was split off from the paper. The owner of the debt were without knowledge that their money was not under Trust management nor that their money was being used to originate or acquire loans without their knowledge.

The securitization sting is accomplished because the owners of the debt (the investors who sourced the funds) are unaware of the fact that the certificate they are holding is merely a promise to pay from a nonexistent trust that never was utilized to acquire the debts and whose ownership of the paper is strictly temporary in order to foreclose.

The failure to make that distinction between the real debt and the fake paper is the principal reason why so many people lose their homes to interlopers who have no interest in the loan but who profit from the sale of the home because a judgment was entered in favor of them allowing them to conduct a foreclosure sale. 

This case also sets forth universally accepted legal doctrine even where there is a clerk’s default entered against the homeowner. The Judge cannot enter a judgment for an alleged debt without proving the debt — even if the homeowner doesn’t show up.

“When a default is entered, the defendant is deemed to have admitted all of the well- pleaded factual allegations in the complaint pertaining to liability.” Bravado Int’l Grp. Merch. Servs., Inc. v. Ninna, Inc., 655 F. Supp. 2d 177, 188 (E.D.N.Y. 2009) (citing Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992)). “While a default judgment constitutes an admission of liability, the quantum of damages remains to be established by proof unless the amount is liquidated or susceptible of mathematical computation.” Flaks v. Koegel, 504 F.2d 702, 707 (2d Cir. 1974); accord, e.g., Bravado Int’l, 655 F. Supp. 2d at 190. “[E]ven upon default, a court may not rubber-stamp the non-defaulting party’s damages calculation, but rather must ensure that there is a basis for the damages that are sought.” United States v. Hill, No. 12-CV-1413, 2013 WL 474535, at *1 (N.D.N.Y. Feb. 7, 2013)

“The burden is on the plaintiff to establish its entitlement to recovery.” Bravado Int’l, 655 F. Supp. 2d at 189.

 

Breaking it Down: What to Say and Do in an Unlawful Detainer or Eviction

Homeowners seem to have more options than they think in an unlawful detainer action based upon my analysis. It is the first time in a nonjudicial foreclosure where the foreclosing party is actually making assertions and representations against which the homeowner may defend. The deciding factor is what to do at trial. And the answer, as usual, is well-timed aggressive objections mostly based upon foundation and hearsay, together with a cross examination that really drills down.

Winning an unlawful detainer action in a nonjudicial foreclosure reveals the open sores contained within the false claims of securitization or transfer.

NEED HELP PREPARING FOR UNLAWFUL DETAINER TRIAL? We can help you with Discovery and Compelling Responses to Discovery Requests with Our Paralegal Team that works directly with Neil Garfield! We provide services directly to attorneys and to pro se litigants.

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HAT TIP TO DAN EDSTROM

Matters affecting the validity of the trust deed or primary obligation itself, or other basic defects in the plaintiffs title, are neither properly raised in this summary proceeding for possession, nor are they concluded by the judgment.” (Emphasis added.) (Cheney v. Trauzettel (1937) 9 Cal.2d 158, 159-160.) My emphasis added

So we can assume that they are specifically preserving your right to sue for damages. But also, if they still have the property you can sue to get it back. If you do that and file a lis pendens they can’t sell it again. If a third party purchaser made the bid or otherwise has “bought” the property you probably can’t touch the third party — unless you can show that said purchaser did in fact know that the sale was defective. Actual knowledge defeats the presumptions of facially valid instruments and recorded instruments.

The principal point behind all this is that the entire nonjudicial scheme and structure becomes unconstitutional if in either the wording of the statutes or the way the statutes are applied deprive the homeowner of due process. Denial of due process includes putting a burden on the homeowner that would not be there if the case was brought as a judicial foreclosure. I’m not sure if any case says exactly that but I am sure it is true and would be upheld if challenged.


It is true that where the purchaser at a trustee’s sale proceeds under section 1161a of the Code of Civil Procedure he must prove his acquisition of title by purchase at the sale; but it is only to this limited extent, as provided by the statute, that the title may be litigated in such a proceeding. Hewitt v. Justice’ Court, 131 Cal.App. 439, 21 P.(2d) 641; Nineteenth Realty Co. v. Diggs, 134 Cal.App. 278, 25 P.(2d) 522; Berkeley Guarantee Building & Loan Ass’n v. Cunnyngham, 218 Cal. 714, 24 P.(2d) 782. — [160] * * * In our opinion, the plaintiff need only prove a sale in compliance with the statute and deed of trust, followed by purchase at such sale, and the defendant may raise objections only on that phase of the issue of title

So the direct elements are laid out here and other objections to title are preserved (see above):

  • The existence of a sale under nonjudicial statutes
  • Acquisition of title by purchase at the sale
  • Compliance with statutes
  • Compliance with deed of trust

The implied elements and issues are therefore as follows:

  • Was it a Trustee who conducted the sale? (i.e., was the substitution of Trustee valid?) If not, then the party who conducted the sale was not a trustee and the “sale” was not a trustee sale. If Substitution of Trustee occurred as the result of the intervention of a party who was not a beneficiary, then no substitution occurred. Thus no right of possession arises. The objection is to lack of foundation. The facial validity of the instrument raises only a rebuttable presumption.
  • Was the “acquisition” of title the result of a purchase — i.e., did someone pay cash or did someone submit a credit bid? If someone paid cash then a sale could only have occurred if the “seller” (i.e., the trustee) had title. This again goes to the issue of whether the substitution of trustee was a valid appointment. A credit bid could only have been submitted by a beneficiary under the deed of trust as defined by applicable statutes. If the party claiming to be a beneficiary was only an intervenor with no real interest in the debt, then the “bid” was neither backed by cash nor a debt owed by the homeowner to the intervenor. According there was no valid sale under the applicable statutes. Thus such a party would have no right to possession. The objection is to lack of foundation. The facial validity of the instrument raises only a rebuttable presumption.

The object is to prevent the burden of proof from falling onto the homeowner. By challenging the existence of a sale and the existence of a valid trustee, the burden stays on the Plaintiff. Thus you avoid the presumption of facial validity by well timed and well placed objections.

” `To establish that he is a proper plaintiff, one who has purchased property at a trustee’s sale and seeks to evict the occupant in possession must show that he acquired the property at a regularly conducted sale and thereafter ‘duly perfected’ his title. [Citation.]’ (Vella v. Hudgins (1977) 20 Cal.3d 251,255, 142 Cal.Rptr. 414,572 P.2d 28; see Cruce v. Stein (1956) 146 Cal.App.2d 688,692,304 P.2d 118; Kelliherv. Kelliher(1950) 101 Cal.App.2d 226,232,225 P.2d 554; Higgins v. Coyne (1946) 75 Cal.App.2d 69, 73, 170 P2d 25; [*953] Nineteenth Realty Co. v. Diggs (1933) 134 Cal.App. 278, 288-289, 25 P2d 522.) One who subsequently purchases property from the party who bought it at a trustee’s sale may bring an action for unlawful detainer under subdivision (b)(3) of section 1161a. (Evans v. Superior Court (1977) 67 Cai.App.3d 162, 169, 136 Cal.Rptr. 596.) However, the subsequent purchaser must prove that the statutory requirements have been satisfied, i.e., that the sale was conducted in accordance with section 2924 of the Civil Code and that title under such sale was duly perfected. {Ibid.) ‘Title is duly perfected when all steps have been taken to make it perfect, i.e. to convey to the purchaser that which he has purchased, valid and good beyond all reasonable doubt (Hocking v. Title Ins. & Trust Co, (1951), 37 Cal.2d 644, 649 [234 P.2d 625,40 A.L.R.2d 1238] ), which includes good record title (Gwin v. Calegaris (1903), 139 Cal. 384 [73 P. 851] ), (Kessler v. Bridge (1958) 161 Cal.App.2d Supp. 837, 841, 327 P.2d 241.) ¶ To the limited extent provided by subdivision (b){3) of section 1161a, title to the property may be litigated in an unlawful detainer proceeding. (Cheney v. Trauzettel (1937) 9 Cal.2d 158, 159, 69 P.2d 832.) While an equitable attack on title is not permitted (Cheney, supra, 9 Cal.2d at p. 160, 69 P.2d 832), issues of law affecting the validity of the foreclosure sale or of title are properly litigated. (Seidel) v. Anglo-California Trust Co. (1942) 55 Cai.App.2d 913, 922, 132 P.2d 12, approved in Vella v. Hudgins, supra, 20 Cal.3d at p. 256, 142 Cal.Rptr. 414, 572 P.2d 28.)’ ” (Stephens, Partain & Cunningham v. Hollis (1987) 196 Cai.App.3d 948, 952-953.)
 
Here the court goes further in describing the elements. The assumption is that a trustee sale has occurred and that title has been perfected. If you let them prove that, they win.
  • acquisition of property
  • regularly conducted sale
  • duly perfecting title

The burden on the party seeking possession is to prove its case “beyond all reasonable doubt.” That is a high bar. If you raise real questions and issues in your objections, motion to strike testimony and exhibits etc. they would then be deemed to have failed to meet their burden of proof.

Don’t assume that those elements are present “but” you have a counterargument. The purpose of the law on this procedure to gain possession of property is to assure that anyone who follows the rules in a bona fide sale and acquisition will get POSSESSION. The rights of the homeowner to accuse the parties of fraud or anything else are eliminated in an action for possession. But you can challenge whether the sale actually occurred and whether the party who did it was in fact a trustee. 

There is also another factor which is whether the Trustee, if he is a Trustee, was acting in accordance with statutes and the general doctrine of acting in good faith. The alleged Trustee must be able to say that it was in fact the “new” beneficiary who executed the substitution of Trustee, or who gave instructions for issuing a Notice of Default and Notice of sale.

If the “successor” Trustee does not know whether the “successor” party is a beneficiary or not, then the foundation testimony and exhibits must come from someone who can establish beyond all reasonable doubt that the foreclosure proceeding emanated from a party who was in fact the owner of the debt and therefore the beneficiary under the deed of trust. 

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