Punitive Damages for Violations of Automatic Stay in Bankruptcy §362

Since 2008 I have called out bankruptcy practitioners for their lack of interest in false claims of securitization. The impact on the bankruptcy estate is usually enormous. But without aggressive education of the presiding judge the case will not only go as planned by the banks, it will also lock in the homeowner to “admissions” in bankruptcy schedules and orders that lead to a false conclusion of fact.

Where a pretender lender ignores the automatic stay Bankruptcy judges are and should be very harsh in their penalty. The stay is the bulwark of consumer protection under bankruptcy proceedings which are specifically enabled by the U.S. Constitution. Hence it is as important as free speech, freedom of assembly, freedom of religion and the right to keep and bear arms.

The attached article shown in the link below gives the practitioner a running start on holding the violator responsible and in giving the homeowner a path to punitive damages, given the corrupt nature of the mortgages and foreclosures that arose during the great mortgage meltdown.

This might be the place where a hearing on evidence is conducted as to the true nature of the forecloser and a place where the petitioner/homeowner will be given far greater latitude in discovery to reveal the emptiness behind the presumptions that the foreclosing “party” exists at all or to show that it never acquired the debt but seeks instead to enforce fabricated paper.

Remember that in cases involving securitization claims or which are based upon apparent securitization patterns the named “Trustee” is not the party in interest. The party is the named “Trust.” If the Trust doesn’t exist it doesn’t matter if the Pope is named as the Trustee, there still is no existing party seeking relief from the Court.

see Eviction Can Lead to Sanctions Including Punitive Damages for Violation of Automatic Stay

The challenge here is that most bankruptcy lawyers are not well equipped for litigation. So it is advised that a litigator be introduced into the case to plead and prove the case for sanctions, if the situation arises in which a violation of stay has occurred or if there is an adversary proceeding seeking to prevent the pretender lender from acting on its false claims.

Most of the litigation in bankruptcy court has simply been directed at motions to lift the automatic stay. In such motions, the petitioner is merely saying we want to litigate this in state court. The burden of proof is as light as a puff of smoke. If the court finds any colorable interest in the alleged loan, it will ordinarily grant the motion to lift stay — as it must under the existing rules. Homeowners in bankruptcy find it a virtually impossible uphill climb to defend because they are required to have evidence only in possession of the opposing party who also might not have the information needed to prove the lack of any colorable interest.

But the lifting of the stay applies to the litigation concerning foreclosure. It does not necessarily extend to the eviction or unlawful detainer that occurs afterwards. And where the stay has not been lifted the pretender lender is out of luck because there is no excuse for ignoring the automatic stay.

So further action by the foreclosing party is probably a violation of the automatic stay. And in certain cases the court might apply punitive damages on top of consequential damages, if any. The inability to prove actual damages is relatively unimportant unless the homeowner has such damages. It is the violation of the automatic stay that is paramount.

The article below starts with a premise that the “creditor” has received notice of the BKR and ignored it — sometimes willfully and arrogantly.

Here are some notable quotes from this well-written article by Carlos J. Cuevas.

The imposition of punitive damages for egregious violations of the automatic stay is vital to the function of the consumer bankruptcy system. Most consumer debtors cannot afford to pay their attorneys to prosecute an automatic stay violation. The enforcement of the automatic stay is predicated upon major financial institutions observing the automatic stay.

If there is a doubt as to the applicability of the automatic stay, then a creditor can obtain a comfort order as to the applicability of the automatic stay, or obtain relief from the automatic stay from the Bankruptcy Court.

“Parties may not make their own private determination of the scope of the automatic stay without consequence.”

What would be sufficient to deter one creditor may not even be sufficient to gain notice from another. Punitive damages must be tailored not only based upon the egregiousness of the violation, but also based upon the particular creditor in violation.

In determining whether to impose punitive damages under Bankruptcy Code Section 362(k), several bankruptcy courts have identified five factors to guide their decision. They are the nature of the creditor’s conduct, the creditor’s ability to pay, the motives of the creditor, any provocation by the debtor, and the creditor’s level of sophistication: In re Jean-Francois, 532 B.R. 449, 459 (Bankr. E.D.N.Y. 2015).

The fact that Church Avenue pursued the eviction more than a week after it learned of the debtor’s bankruptcy suggests that Church Avenue either made its own—incorrect—legal conclusion with respect to whether the eviction would be a stay violation, or decided that moving ahead to empty the building quickly and evict the occupants was worth more to it than the risk associated with defending a future § 362(k) motion.

when a creditor acts in arrogant defiance of the automatic stay it is circumventing the authority of the bankruptcy judge to exercise authority over that particular bankruptcy case. A bankruptcy judge is the only entity vested with the authority to determine whether the automatic stay should be lifted.

Egregious violations of the automatic stay can be deleterious to a consumer bankruptcy debtor. For example, a creditor who refuses to return a repossessed vehicle after the commencement of a bankruptcy case can create a significant hardship for a consumer debtor. A debtor whose vehicle has been repossessed may not be able to rent a substitute vehicle. This can create a significant hardship for a debtor who has to commute to work, who has to transport a child to school, or who is a caregiver for a sick relative.

Questions to Ask About the Trust and the Trustee

In the final analysis you are looking for evidence of absence of any real events currently presumed as facts in any foreclosure case.

The trustee issue is a jurisdictional issue. If the Plaintiff Trust does not exist, then it has no standing to make or pursue any claims. If the named Trustee is not engaged in the active management of active trust affairs on behalf of the beneficiaries of a trust, then it is not a trustee imbued with the powers to administer assets that have not been conveyed and entrusted to the Trustee.
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If the named beneficiaries have received a promise from the named “Trust” and the beneficiaries have expressly disclaimed any interest in the “underlying” loans, notes, mortgages or debts, then they are not beneficiaries and the entity is not a trust. (That fact pattern describes individual contracts with each investor who purchased a promise to pay executed by someone allegedly on behalf of an entity self proclaimed as a trust. If the named entity does not exist then the party who executed the isntruments may have liability for the promise).
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Since the Trust has not been identified as having been organized and existing under the laws of any jurisdiction, it is entirely appropriate to ask questions about the existence of the trust and its right to do business in the state or the courts. The second jurisdictional issue is subject matter jurisdiction in which the question is whether the trust owns the indebtedness. I frequently deal with these issues in drafting the substance of documents to be filed with the court, subject to opinion of local counsel.
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If prior demands for discovery are clear the appropriate strategy is to force the issue through a motion to compel. Filing an “amended” request fro discovery probably starts the clock all over again. By the time you get to a demand for sanctions for contempt the case could be over. If it is denied she should consider an interlocutory appeal on the issue of whether the record contains assertions or evidence of the existence of the trust. The only prejudice that could exist would be that the trust doesn’t exist and that “they” (actually the lawyers) would be “prejudiced” because they couldn’t foreclose using the trust name.
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There is no doubt in my mind that one or both narratives are true: (1) the trust doesn’t exist and never did and (2) the loan (i.e., the indebtedness) was never purchased by the trust, acting through tis alleged trustee.
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One of the problems here is that it would be wise, although not essential, to notice the named Trustee for deposition duces tecum. That’s often a problem because most homeowners not appear to have anyone competent to conduct the deposition. In a normal deposition, one MUST ask the witness identifying questions like
  1. What’s your name?
  2. Who do you work for?
  3. What is the relationship between your bank and this trust?
  4. Besides the alleged Prospectus and the alleged PSA, what agreements exist wherein the Trustee bank is obligated to do or receive anything from the trust, directly or indirectly. [This one should be broken up into parts].
  5. Under what jurisdiction was the trust organized?
  6. Under what jurisdiction is the trust now existing?
  7. Who is the trust officer for the trust?
  8. In which department(s) are trust matters generally handled in the Trustee Bank?
  9. In which department(s) are trust matters usually handled in the Trustee Bank for this trust?
  10. Has the Trustee bank published any memos or guidelines concerning the administration of securitization trusts?
  11. Assuming that the word “loan” means the indebtedness of the homeowners here in this case, on what date did US Bank as trustee purchase this loan to hold in trust?
  12. Who was the seller of the debt in that transaction?
  13. Was payment for the loan performed through a financial account held in the name of the Trustee for the alleged trust?
  14. How did US Bank as Trustee for the alleged trust perform due diligence to confirm the existence and ownership of the debt?
  15. Who are the beneficiaries of the alleged trust?
  16. Who is the trustor or settlor of the alleged trust?
  17. What is the date and name of the instrument that purports to create the trust?
  18. Describe the current functions of US Bank as trustee of the alleged trust.
  19. Describe the current assets of the alleged trust.
  20. Describe date and content of the last financial report received by US Bank as trustee for the alleged trust.
Most likely opposing counsel will object to the question’s relevancy at the time deposition is taken. But relevancy is not even a question at deposition which is by nature a fishing expedition. Even if opposing counsel was right that the question does not directly relate to proof of a fact asserted at trial, you are still entitled to inquire because it might lead to the discovery of admissible evidence.

TONIGHT! Aggregation and Assignments on the Neil Garfield Show

Are Assignments Based Upon Aggregated Pools Real?

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Or call in at (347) 850-1260, 6pm Eastern Thursdays

East-West: Charles Marshall California Attorney co-hosts the discussion

 

The bottom line is that the courts are not accepting denials of assertions or allegations by the foreclosing party. The courts are requiring the homeowner to file an affirmative defense rather than simply denying everything in the complaint. This forces the burden of proof and burden of persuasion onto the homeowner to come up with facts supporting their denial. These facts are within the sole care, custody and control of the party initiating foreclosure.

Through the magic of writing things down on paper anyone can make anything seem like it might be real. Of course in the legal system it goes further than that. If it is written there are many assumptions and presumptions that arise simply because a piece of paper was produced with some writing on it. But nobody ever intended such writing to be used in lieu of facts that are contrary to the truth.

The first place you see this scheme in operation is in the supposed aggregation of loans. The truth is that the DATA for the loans was aggregated, which only means that information ABOUT the supposed loans was taken from several spreadsheets and combined into one.

This is done all the time when a PROPOSED deal is in the works. The aggregation of the data is known as a pro forma presentation — with all parties knowing that it isn’t real, but here is what it might look like if we really did it.

The banks have elevated pro forma spreadsheets into the illusion of actual deals. The reason nobody has ever come up with a money trail showing that the aggregation took place and was sold to a trust is that no such money trail exists.

The truth is that no actual aggregation took place and there was no sale to the trust. In fact probing the trusts, there is never a time that the trust is actually created by entrusting money or property to the named Trustee. Without that there is no Trust because nothing is held “in trust.”

The money from investors is never held by the Trustee. The loan debt is never owned by the Trustee or the Trust. There is no sale. And that is because the Broker Dealers funded the loans in the first place using the money of investors.

So there was nobody to pay for purchase of the underlying debt except the investors and the banks certainly were not going to pay for the underlying debt by handing the investors a check or wire transfer.

How did they do it? Through the illusion of Assignments and endorsements by entities and people who have no ownership interests or other rights to the underlying debt. Even servicing relies upon authority from a trust that does not exist and which neither owns the paper nor the underlying debt.

Let’s go back to the beginning. For ANY deal to be legally binding you need the following elements:

  1. An offer of terms by A to B.
  2. Acceptance of those exact terms by B.
  3. Now you have an agreement but not a contract (yet).
  4. Memorialization of the contract in writing.
  5. The contract is not enforceable until the parties sign
  6. The Closing: Reciprocal consideration is exchanged.
  7. Now you have an enforceable contract.

The only thing we get with assignments and endorsements on supposed “allonges” is #4 — Memorialization in Writing. There is no evidence or even assertion that any of the other things happened. Hence the foreclosing party is using an unenforceable false memorialization of a transaction (transfer of loan paper and no transfer of the underlying debt) that never occurred in order to create the illusion of a foreclosure by a real party in interest.

This is all basic Black Letter law. Yet the courts have routinely ignored several very specific laws governing loans, notes, mortgages and assignments and endorsements. Judges have routinely assumed and even presumed that the paper memorialization was all they needed. The door to moral decay and hazard was opened wide. And we all experienced the shock of seeing our economy nearly turn on its belly.

Now Congress is in the process of rolling back the safeguards so that the investment banks can return to business as usual — transforming the role of banks from being financial intermediaries into some multi-headed hybrid creature that can steal money and homes. The banks can do this by using ordinary deposits by its customers, or by soliciting new deposits with the false promise that the money is actually going into a Trust where a big name bank like US Bank will watch over it.

How do you stop it? By litigating on the strategy and narrative that there is no meat in the sandwich, no deal that ever occurred in real life and no authorized intermediary whose claim is solely based upon the existence of a nonexistent trust and nonexistent transactions in which the underlying debt was bought and sold.

 

Homeowners Sue SPS in Class Action Over Failure to Mitigate

Thousands of cases like this one have pointed out that SPS and other servicers like Ocwen do not consult with any investor, do not evaluate the case for settlement, modification or mitigation. The answer to questions arising from the unwillingness of those companies to comply with law stems from the fact that the  vast majority of their income comes from undisclosed third parties (the TBTF Banks).

TBTF Banks (BofA, Chase, Wells Fargo, Citi, etc.) do not want settlements or modifications or anything that will make the loan start performing. Subservicers like SPS and Ocwen are used as conduits to other conduits that provides window dressing for claims of compliance or efforts to comply.

Contrary to common sense nobody wants a settlement or modification. The players would rather have the value of the alleged loan reduced to zero or less in the case of foreclosures requiring the bank to maintain the property without any hope of selling it. Common sense says that faced with a value of ZERO versus a value of $200,000, for example, any normal business would select the obvious —- $200,000.

The most extreme cases are where the modification is deemed approved and a new servicer comes in to dishonor it and forecloses, even though the homeowner made the trial payments. Yet Petitions to Enforce the modification agreement are rare; but when they are filed they are usually successful. And in many of those cases the modification is modified for a greater principal reduction than was originally offered.

GET A CONSULT

FREE RESEARCH: Go to our home page and enter subject in search bar.

GO TO LENDINGLIES to order forms and services. Our forensic report is called “TERA“— “Title and Encumbrance Report and Analysis.” I personally review each of them for edits and comments before they are released.

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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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Whether or not the class gets certified or settled the suit brings up certain salient points which again give rise to the most common question of all, to wit: “Why is that?”

The answer is hiding in plain sight: None of these parties represent a creditor or owner of the debt . All of them represent undisclosed third parties who are making money hand over fist in the shadow banking market. A completed foreclosure represents the first and only valid legal document in their long train of lies promulgated by piles of fabricated, forged, robo-signed paper. The justice system isn’t always right but it is always final. That is the game the banks are playing.

If SPS or Ocwen actually was set up to help homeowners avoid foreclosure and preserve the value of the loan receivable they would lose virtually all their business. A performing loan would change the makeup of the pools that the players claim to have created. All the re-sales of the same loan would be based upon a loan, even if it existed at one time, that doesn’t exist presently.

So the players NEED that foreclosure not for investors or a trust that doesn’t exist, but for themselves because most of the proceeds of the re-sales of the same loan went the TBTF Banks. They want to preserve their ill-gotten gains rather than do anything that could possibly benefit investors. And the best way they can do that is with an Order or Judgment signed by a duly authorized judge in a court of competent jurisdiction — not with a modification.

Practice Hint: If you see a case that has been ongoing for 8-10 years that is a strong indicator that the investors have received a settlement and no loner have any claim for payment and/or that the “Master Servicer” is continuing to allow payments to investors out of a pool of investor money — i.e., a Ponzi scheme. Those continuing payments have been inappropriately named “servicer advances.” They are not “advances” because it is merely return of investor capital. And since the payments come from an investor pool of cash the payments are not from the servicer since the money came from the same or other investors.

They are called servicer advances because using that name fictitiously allows the “Master Servicer’ (actually the underwriter of the certificates) to claim a “recovery” of “servicer advances.” The recovery is ONLY allowed after sale of the property after a foreclosure where the buyer is a BFP.

So for example if payments to investors attributed to the subject loan are $2,000 per month, 10 years worth of “servicer advances” results in a “recovery claim” of $240,000. Generally that is enough to wipe out any equity. The investors get nothing. The foreclosure was actually for the sole interest and benefit of the banks, not the investors. And the homeowner again finds himself used as a pawn for others to make money over the rotting carcass of what was once his home.

Hence the trial strategy suggested would be drilling down on whether the trust is receiving payment from a “third party,” whether that party has rights of subrogation or is satisfied by some other fee or revenue. If you get anywhere near this issue the bank will fold up like a used tent. They will pay for confidentiality.

The Role of Dynamic Dark Pools in Ponzi Schemes Masquerading as Securitized Loan Pools

The bottom line is that there are no financial transactions in today’s securitization schemes. There is only fabricated paper. If you don’t understand the DDP, you don’t understand “securitization fail,” a term coined by Adam Levitin.

GET A CONSULT

GO TO LENDINGLIES to order forms and services. Our forensic report is called “TERA“— “Title and Encumbrance Report and Analysis.” I personally review each of them for edits and comments before they are released.

Let us help you plan your answers, affirmative defenses, discovery requests and defense narrative:

954-451-1230 or 202-838-6345. Ask for a Consult. You will make things a lot easier on us and yourself if you fill out the registration form. It’s free without any obligation. No advertisements, no restrictions.

Purchase audio seminar now — Neil Garfield’s Mastering Discovery and Evidence in Foreclosure Defense including 3.5 hours of lecture, questions and answers, plus course materials that include PowerPoint Presentations.

THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.

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I received a short question today to which I gave a long answer. The question is “What happens when an investor decides that he or she wants to cash it in does someone redeem their certificate ?”

Here is my answer:

YES they get paid, most of the time. It is masked as a “trade” on the proprietary trading desk of the CMO Dept. which is completely unregulated and reports nothing. As long as the Ponzi scheme is going strong, the underwriter issues money from the investor pool of money (dynamic dark pool -DDP). It looks like a third party bought the “investment.” If the scheme collapses then the underwriter reports to investors that the market is frozen and there are no buyers.

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There is no redemption because there are no certificates. They are all digital entries on a server. Since the 1998 law deregulated the certificates, reporting is limited or nonexistent. The entries can be changed, erased, altered, amended or modified at will without any regulator or third party knowing. There is no paper trail. Thus the underwriter will say, if they were ever asked, whatever suits them and there is no way for anyone to confirm or rebut that. BUT in discovery, the investors have standing to ask to see the records of such transactions. That is when the underwriter settles for several hundred million or more.
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They discount the settlement based upon “market” values and by settling for pennies on the dollar with small community banks who do not have resources to fight. Thus if they received $2 billion for a particular “securitized pool” that is allocated to a named trust they will instantly make about 10-20 times the normal underwriting fee by merely taking money before or after the money hits the DDP. Money is paid to the investors as long as sales of certificates are robust. Hence the DDP is constantly receiving and disbursing money from many more sources than a fixed group of homeowners or investors.
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It is all about gaps and absences. If a debt was properly securitized, the investor would pay money to the underwriter in exchange for ownership of a certificate. The money would then be subject to fees paid to the underwriter and sellers of the certificates. The balance would be paid into a trust account on which the signatory would be a trust officer of the Trustee bank.
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If a scheme is played, then the money does not go into the trust. It goes to the DDP. From there the money is funneled through conduits to the closing table with the homeowner. By depositing the exact and expected amount of money into the trust account of the closing agent, neither the closing agent nor the homeowner understands that they are being played. They don’t even have enough information to arouse suspicion so that they can ask questions.
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Hence if you combine the proper securitization scheme with the improper one you see that the money is diverted from the so-called plan. This in turn causes the participants to fabricate documents if there is litigation. They MUST fabricate documents because if they produced real documents they would have civil and criminal liability for theft, embezzlement in investor litigation and fraud and perjury in foreclosure litigation.
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It is only by forcing a peek around the multiple layers of curtains fabricated by the players that you can reveal the absence of ownership, authority or even an economic interest — other than the loss of continued revenue from servicing and resales of the same loan through multiple investment vehicles whose value is completely derived from the presumed existence of a party who is the obligee of the debt (owner of the debt, or creditor).
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That party is the DDP — fund that is partially authorized for “reserve” and which the prospectus and trust instrument (PSA) state (1) that the mortgage loan schedule is not the real one and is presented as an example and (2) that the investors acknowledge that they might be paid from their own money from the “reserve.”
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The gap is that the DDP and the reserve are two different accounts. The “reserve” is a pool of money held in trust by, for example, U.S. Bank as trustee for the trust. There is no such account. The DDP is controlled by the underwriter but ownership is intentionally obscured to avoid or evade detection and the liability that would attach if the truth were revealed.
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We win cases not by proving theft from investors but by hammering on the fact that the documents are fabricated, which is true in virtually all cases involving a named trust. We will win a large award if we can show that the intended beneficiaries of the foreclosure were parties other than the obligee on the debt.
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Thus the attorneys, servicers and trustee are protecting their ill-gotten gains and seeking to grab more money and property at the expense of the unnamed investors and homeowners. They are then transforming an expected revenue stream into the illusion of a secured debt owed not to the funding sources but to the intermediaries.
Go to LENDINGLIES for more help.

Lehman to Pay $2.4 Billion out of Bankrupt Estate

“Lehman’s own documents show it was aware of the widespread problems and deteriorating performance of the loans it had securitized,” with half the loans at one point containing material misrepresentations, the trustees said in a court filing.

Editor’s Note: The difference is money — investors have it and borrower’s don’t. So while investors are successfully litigating fraud and deceit, the borrowers can’t afford to litigate the same issues. The idea that Lehman was somehow honest with borrowers and not with investors is preposterous.

Lehman recently closed out a $2 billion dispute with Citigroup Inc. over derivatives, and similar litigation over derivatives with Credit Suisse Group AG is the last major remaining contest.

Around 14 large institutional holders, including Goldman Sachs Asset Management LP and BlackRock Financial Management, broke ranks with hedge funds and accepted a settlement last year valuing claims around $2.4 billion. Chapman noted that these “sophisticated players” held around 24 percent of the RMBS.

GO TO LENDINGLIES to order forms and services

Let us help you plan your answers, affirmative defenses, discovery requests and defense narrative:

954-451-1230 or 202-838-6345. Ask for a Consult. You will make things a lot easier on us and yourself if you fill out the registration form. It’s free without any obligation. No advertisements, no restrictions.

Purchase now Neil Garfield’s Mastering Discovery and Evidence in Foreclosure Defense webinar including 3.5 hours of lecture, questions and answers, plus course materials that include PowerPoint Presentations. Presenters: Attorney and Expert Neil Garfield, Forensic Auditor Dan Edstrom, Attorney Charles Marshall and and Private Investigator Bill Paatalo. The webinar and materials are all downloadable.

Get a Consult and TERA (Title & Encumbrances Analysis and & Report) 954-451-1230 or 202-838-6345. The TERA replaces and greatly enhances the former COTA (Chain of Title Analysis, including a one page summary of Title History and Gaps).

GO TO WWW.LENDINGLIES.COM OR 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.

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See Lehman Brothers Knew 1/2 the loans were misrepresented to both borrowers and investors

The trustees representing RMBS holders are Deutsche Bank National Trust Co., Law Debenture Trust Co. of New York, U.S. Bank National Association and Wilmington Trust Co., according to court papers.

A group of hedge funds, including Whitebox Advisors LLC, Deer Park Road Management Co. and Tilden Park Capital Management LP, was formed in 2016, and expanded in May 2017 to include Prophet Capital Management LP, Tricadia Capital Management LLC, BlueMountain Capital Management LLC and others, according to court records.

The case is In re Lehman Brothers Holdings Inc., 08-13555, U.S. Bankruptcy Court, Southern District of New York (Manhattan.)

Practice note: Dig into the pleadings and exhibits in these cases and you will find a treasure trove of information that supports your contention at trial that the documents are unreliable and therefore the proof of the matters asserted must be proven with facts, not assumptions. You will probably uncover inconsistent allegations from Deutsch, Credit Suisse et al. They are most likely saying one thing in court with borrowers and another in court with investors.

An important note here is that these actions are based upon the presumptive finding of the US Bankruptcy trustee as to Lehman misrepresentations.

 

 

Securitization and Standing

Like other decisions establishing  the law of the land, the decisions of SCOTUS are often taken as advisory or optional. Nevertheless TILA Rescission and Article III standing have been affirmed by the Court of last resort. Reluctant judges in trial and appellate courts will get their hands slapped one more time but all the bad prior decisions and their consequences  are neither reversed nor redressed.

Standing is pretty easy — it must be alleged in facts that will be proven at trial. If it isn’t alleged or isn’t proven at trial, the Court lacks jurisdiction to do anything other than to dismiss the claims of any party seeking satisfaction because they have no claim for redress.

Let us help you plan your defense strategy, discovery requests and defense narrative: Dial 954-451-1230 or 202-838-6345. Ask for a Consult.

Purchase now Neil Garfield’s Mastering Discovery and Evidence in Foreclosure Defense webinar including 3.5 hours of lecture, questions and answers, plus course materials that include PowerPoint Presentations. Presenters: Attorney and Expert Neil Garfield, Forensic Auditor Dan Edstrom, Attorney Charles Marshall and and Private Investigator Bill Paatalo. The webinar and materials are all downloadable.

Get a Consult and TEAR (Title & Encumbrances Analysis and & Report) 954-451-1230 or 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.

See 2017 US Supreme Court case defining burden of PLEADING legal standing: Town of Chester v. Laroe Estates, Inc., 137 S. Ct. 1645, 1650-1651 (2017)

There are three elements of standing:

  1. The party claiming the ultimate relief (like the party seeking foreclosure) MUST have already suffered an injury in fact — one that is “concrete and particularized.” This means that alleging a default is not enough. The presumption that the pleading party suffered economic loss only arises if they plead and prove that they had a right to payment which was not received, thus constituting a default. Nobody alleges that because it isn’t true. Nobody is entitled to any satisfaction in court without pleading and proving facts that the alleged default actually caused financial loss (injury) to the party seeking relief (or the disclosed principal in an agency relationship with the party seeking foreclosure). This feature is particularly twisted in nonjudicial states where the party makes no claim for foreclosure; instead they merely file papers in the county records and put the home up for sale. Standing is nonetheless required in both judicial and nonjudicial states — a fact often ignored in most courtrooms.
  2. The injury must be traceable to conduct of the party alleged to be in default or breach. Hence the party seeking satisfaction through foreclosure must establish that they had a legal right to receive the payments that were specified in the note and mortgage (deed of trust) either because they own the debt or because they represent someone else who owns the debt. Failure to reveal the party who owns the debt leaves the court without any pleading or proof as to who, if anyone, was financially injured when the homeowner stopped making payments to a party that could possibly be the authorized representative to receive such payments and also could possibly not be the authorized party to receive payments. The presumption of injury only arises  when the right to receive payments is both alleged and proven. Once again, courts have twisted this element beyond recognition. The missing creditor is presumed to exist, without a name or any other identifying characteristics.
  3. The injury, once established, must be likely to be redressed by a favorable judicial decision. So if the foreclosure occurs and the sale is made, what will be the ultimate result of liquidation of the property. The answer is that unrelated parties will enjoy the fruits of foreclosure, which is why servicers are under strict instructions not to reveal the recipient of funds paid by putative borrowers. The proceeds from the sale of the property must be claimed by the party seeking foreclosure or claimed by the party on whose behalf the foreclosure was pursued (assuming that party is the owner of the debt and not another conduit). The trusts are all conduits if they claim REMIC status. That is why there are never allegations that the trust owns the debt or is anything other than other than a “holder.” The right to enforce appears to be presumed but is inaccurate since the Trustee and the Trust were absent from any transaction involving the subject loan. So if the proceeds are not going to the party who loaned money and are not going to anyone who bought the debt, there is no subject matter jurisdiction. Here again the courts are twisting laws beyond comprehension by presuming everything that is not susceptible to proof.

The side note is that it does not appear that the REMIC trusts actually exist or were involved in any financial transaction relating to the loans that lawyers claim it owns. SO the claimant does not exist leaving the court without any semblance of jurisdiction if the pleadings are scrutinized for allegations that the “Trust” is a REMIC business trust organized and existing under the laws of the State of New York, for example. They don’t make that allegation — common to all other pleadings in other civil cases — because the trust is merely a graphic image having no significance except for the purposes of foreclosure.

 

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