(BREAKING NEWS — OP-ED) — The poster of this blog is not an attorney and thus, the items proffered on this post should be taken in context as court rulings and should be further interpreted by bar-licensed attorneys (past the point of your personal discretion). The commentary posted here is not legal advice but is for your educational value only.
The month of March certainly roared in like a lion when it comes to court cases. There are 3 of them which are integral to learning about foreclosure defense as to the “what to do” and “what not to do”, or in the alternative, what to “take away” from the herein discussed cases versus “what is irrelevant” and unimportant in them.
FEDERAL CASE: FDCPA
The attached case is a precedent setter out of the Third U.S. Circuit Court of Appeals:
Riccio et al v Sentry Credit Inc, 3rd App Cir No 18-1463 (Mar 30, 2020)_Precedential
If anything could work to your benefit, the Appellant’s attorney’s contact information is listed within the ruling. This case involves abusive debt collection practices prohibited under the Fair Debt Collection Practices Act, 15 U.S.C. 1692 et seq.
This case appears to work to your advantage in the event some snarky foreclosure mill lawyer attempts to remove your case from state court to federal court, which allows you to amend your declaratory relief action to include “debt validation” because this case smacks in that direction, the requirements of a validation notice under the Act. The questions in this case concerns whether “oral disputes” are also covered under the Act.
This is one of the key reasons I keep telling people, when it comes to debt collectors, you can’t take phone calls into court … or can you?
15 U.S.C. § 1692g(b) specifically demands that the debt collector needs to be notified “in writing” within the 30-day dispute period, demanding validation of the debt. This is the very issue that the Third Appellate Court appears to have considered.
This case clearly involves a third-party debt collector, whom we all hate, right? Because the defendant (Sentry Credit, Inc.) (a.) was out of state; and (b.) involved a federal question (FDCPA), this case definitely belonged in federal district court (see my book FDCPA, Debt Collection and Foreclosures for further explanation).
The thing is … the defendant did indeed require a response from the Plaintiff in writing; however, it also provided her with “multiple options”, including calling them on the phone. Debt collectors just love it when you call them because they can use their “power over” tactics on you to verbally beat you into submission and get you to pay. This is why I’ve always said, “put it in writing”, no matter what.
Page 10 of this ruling clearly indicates the Court deemed that “intra-section variation strongly signals that § 1692g permits oral disputes.” Page 11 also indicates that if you call up and dispute the validity of the debt, without putting it in writing, the debt collector can continue its collection efforts. Putting the dispute in writing (and sending it certified mail, return receipt requested) puts the debt collector on official notice and starts the clock ticking, wherein a response is due immediately. Pages 12 and 13 bring to bear the “that dog won’t hunt” argument against overreaching in an interpretation of the law to get it to mean what you want it to mean.
Frankly, when debt collectors used to call me … I knew what my rights were and I pinned their ears back with FDCPA and challenged them on everything they said, telling them to “put it in writing” so I have something to take them to court on. Arguing over the phone is like electricity, the path of least resistance, especially when it comes to enforcing your rights under the law. There is no easy way out. If you want debt collectors to do anything, maintaining your right to engage them on the phone is just as good as doing it in right because it saves you time and a stamp … well, now it appears you’re grasping at straws.
More importantly, the Third Circuit didn’t want to upstage Congressional intent when it wrote the language into the law by attempting to “correct a congressional error” and make its own law out of what Congress intended, thus “rescuing Congress from its drafting errors”.
Even more importantly, the Third Circuit also delineated the difference between a “panel ruling” and the effectiveness and superior trait of an “en banc” ruling (the entire appellate court). It’s important to really get into those pages (18-21) and the discussion involving the differences in opinions (a real educational plus). Stare decisis is also covered within this discussion, which, if nothing more, is good in of itself for educational enlightenment. Not only that, the Third Circuit overturned one of its previous decisions as to “oral disputes” based on the lack of FDCPA language!
In issuing the ruling, the Third Circuit clearly made it plain and simple that if you want the FDCPA to work in your favor with “no legal impediments” … then stop being lazy, quit arguing with the debt collector over the phone … and put your demands in writing so the law will firmly support you when you file an FDCPA suit!
INVESTOR WINS HOA FORECLOSURE SALE SUIT IN NEVADA!
There’s no doubt that homeowners associations wield a lot of power. In some states, like Nevada, after a period of time with no challenge, the parties purchasing HOA-foreclosed properties can wipe out a debt without it being considered “super priority” lien status. Such was the case here:
Berberich v Bank of America et al, 136 Nev 10 (Mar 26, 2020)
I just love the way the Nevada Supreme Court writes its opinions … short and sweet and easy to understand. Thus, I’m not going to be verbose here. What this boils down to is why we have appellate and supreme courts … district court judges are always “looking out for the banks” and have a tendency to “err on the side of … ” (I didn’t say “caution”).
What this all boils down to is chain of title. The possessor of the property held it in title for nearly 6-1/2 years and sought declaratory relief to extinguish the deed of trust which secured a prior owner’s mortgage (if you need a full-blown course on cancellation and expungement actions, you can get it HERE!) loan.
The Plaintiff even sued MERS (which I wouldn’t have done … but) because it was a MERS-originated deed of trust. Bank of America, N.A., which appears to have little regard for quiet title actions, especially when it comes to their alleged “skin in the game”, argued the Plaintiff’s complaint was untimely. The Plaintiff filed a motion for summary judgment (meaning no triable issues of fact) and the District Court (looking out for the banks like these judges always do), ruled against the Plaintiff, who timely appealed. Like the previous case I discussed here … again, relevance to prior case law comes up as to actions to quiet title and considering the statute’s “plain meaning”. The importance of the plain language is clearly clarified in this ruling:
“Now taking a closer look at the statutes plain language, we clarify that the limitations period provided by NRS 11.080 only starts to run when the plaintiff has been deprived of ownership or possession of the property.
Thus, considering the statutory text as a whole, we conclude the limitations period in NRS 11.080 does not run against a plaintiff seeking to quiet title while still seized or possessed of the property.4 See Kerr, 74 Nev. at 272-73, 329 P.2d at 281 (indicating in dicta that NRS 11.080 did not apply where the plaintiff was in joint possession of the property “up to the very time when he commenced his action” to set aside a deed based on fraud and failure of consideration).
Consistent with this understanding of NRS 11.080, the limitations period is triggered when the plaintiff is ejected from the property or has had the validity or legality of his or her ownership orpossession of the property called into question. See, e.g., Salazar v. Thomas, 186 Cal. Rptr. 3d 689, 695 (Ct. App. 2015) (discussing the general rule in California, which has a statute almost identical to NRS 11.080, see Cal. Civ. Proc. Code § 318, that “whether a statute of limitations bars an action to quiet title may turn on whether the plaintiff is in undisturbed possession of the lane (quoting Mayer v. L&B Real Estate, 185 P.3d 43, 46 (Cal. 2008))).
“[M] ere notice of an adverse claim is not enough to commence the owner’s statute of limitations.”
Thus, Nevada’s highest court found that the statute does not bar a property owner who is in possession of a piece of property from bringing a quiet title action; however, the statute of limitations begins to run once the owner has notice of disturbed possession. Since that wasn’t established (as to disturbed possession), the en banc high court reversed and remanded the case back to the district court with instructions!
U.S. BANK SCREWS MAINE HOMEOWNER … BUT WERE ALL THE DUCKS IN A ROW?
The State of Maine’s Supreme Court has come out with some pretty damning case law against the banks, especially when MERS is involved. I will cite the most important “take aways” from this case and also get into the real “red meat” that appeared to have been missed. Read the case first:
US Bank NA v Gordon, 2020 ME 33 (Mar 17, 2020)
First, since a REMIC was involved, no one bothered to question whether the assignment was bogus. No one questioned as to whether the appellant-homeowner was really in default, as there is enough language out there (in the mortgage loan community) to indicate that on the 25th day (or so) of every month, the servicer makes advance payments to the investors through the Trustee. So then, the question becomes, who was harmed? The borrower didn’t have a contract with the servicer.
No one bothered to challenge the endorsement either. As always is a precursor in the First Circuit, most court cases discuss MERS “nominee” status in the recording of the mortgage (as if MERS has some glorious, all-powerful rights vested in it because it’s an “agent”). It also appears that the servicer may have executed a phony “ratification of assignment”, which memorialized the previous 2009 assignment. This of course, happened RIGHT BEFORE foreclosure proceedings were commenced. The Borrower of course, challenged standing based on his claim that the ratification was “inadmissible hearsay” and that even if admissible, it was insufficient to prove U.S. Bank’s ownership interest in the mortgage.
Page 3 clearly explains the effects of a recorded document under subheading “A”. Not once did I see (and you can fact check me if you want to) an attempt to do a C&E on either the assignment or the ratification that was used to give more “legal effect” to the first bogus act (in 2009). Gordon had plenty of opportunity to challenge the validity of these documents under M.R.S. Title 17A, Ch. 29. Nor did Gordon attempt to destroy the validity of these documents by civilly putting forth a cause of action under the Maine Unfair Trade Practices Act (Title 5 §§ 207 and 213). Maine has existing case law that allows for documents to be challenged, cancelled and expunged … Abbott v. Treat, 78 ME 121 (1886) … and that is an OLD, WELL-ESTABLISHED CASE!
Once these two documents were challenged, Greenleaf and Saunders, Maine’s two infamous anti-MERS cases, could have then come into play here.
In other words, you can’t create and record one phony document to give the first phony document more legal force and effect when the first phony document was full of false and misrepresentative statements (constituting perjury on the land record).
There was no discussion on the authority of the MERS (potential) “robosigner” on the first 2009 assignment of mortgage. Despite all of the colorful “resolutions” that MERS puts out into the marketplace in an attempt to give its “agency” status some sort of God-complex-like authority, its “Certifying Officers” have to have a fidelity bond and an errors and omissions insurance policy, naming them as insured. Lacking this, the signers lack authority to do anything, except to go into a closet and play with themselves.
It also further appears that Gordon had a “legal aid” attorney representing him, which is another reason the attorney probably wasn’t aware of document challenges, which this case appears to have been totally ripe for challenging. This ruling came out on St. Patrick’s Day … definitely NOT the pot of gold at the end of the rainbow.
INTER ALIA … (the Latin term for “among other things”) …
There are other valuable lessons we’re learned through time and that is how the United States (and its individual states) respond to a crisis … like the crisis we’re currently facing. Despite the fact that this coronavirus has not taken the toll of the Swine Flu, the Avian Flu or most certainly the Spanish Flu, it still shows us that our medical response-ability in this country is sorely lacking.
In Florida, 170 people are now dead as of the 6:00 p.m. count, with 1,334 admitted to hospitals (figure a 50% mortality rate) and 10,268 total cases opened of which 9,925 have tested positive for COVID-19 (figure a 30-40% mortality rate), so we’re looking at over 1,000 dead (just in Florida) before this is all over and we’ve not hit our “apex” yet. There’s no flattening of any curve (and certainly not our tummies from all of the unhealthy junk food we’ll be consuming the next 30 days) any time soon. This 30-40% of the cases reported at present (up to 3,200) are at risk of expiring on a ventilator, that they may not get to be put onto because we lack them too. So now I’m projecting our death toll at well into the thousands before this ends. The U.S. toll will be much worse, especially in areas of dense populations (Detroit, New Orleans, Chicago, Miami) because … well … that’s just the way things are among the “entitled”.
The State of Florida goes into a “safer-at-home” mode statewide as of midnight tonight (the 2nd). That does not however mean, that Floridians are going to absolutely “heed” the warnings and stay put. They’re too used to partying. I mean, with many in the Sunshine State claiming “retired status”, what else is there to do besides having back yard parties, formal and informal get togethers, golf and boating outings, fishing excursions and hanging out in bars listening to live music, getting hammered on happy hour pricing … along with going out to eat … Floridians’ favorite pastime and going shopping.
It was obvious we didn’t learn the meaning of social distancing, so the “nanny state” has to kick in and do its thing to remind us we need to be more responsible to each other if we’re going to continue to survive, even in the future as to further pandemics. And I’ll concede here the Governor’s order was late in coming, but will it have any real impact if peoples’ attitudes remain the same (as if the order hadn’t come at all)? I’m not faulting the Governor’s delayed reactions. None of us were prepared for this eventuality and we should have been.
We still lack masks, gowns and respirators. We still lack toilet paper (because someone out there is wiping their ass a 1,000 times a day) due to hoarding, as well as hand sanitizer (despite reports that it may not be that “sanitary” to use as a foolproof guard (like Lysol) for NOT killing the coronavirus.
I am going to go to the store and buy one bar of Castille Soap (x 4 for 4 bathrooms in my house) and no more, so that I am sure when I wash my hands, ALL of the germs are getting wiped out, as there are questions of whether the “antibacterial” soap, which is supposed to get rid of “bacteria”, which viruses are NOT, is as effective as “they” say.
Among other things, join R.J. Malloy and me on City Spotlight-Special Edition on WKDW-FM this coming Monday at 2 P.M. EDT … click HERE to get online and then click LISTEN NOW to join the broadcast (at 4 minutes past the hour).
Stay safe and stay healthy (I’m still doing the Allimax thing and I’m feeling great! allimax.us).
A BIT DISCONCERTING UPDATE …
Stuff has been circulating about that is a bit inflammatory and disconcerting as to some folks’ deep-seated feelings about Americans (click the photo to enlarge it and click the back button to return to the article):
I can safely say that not all of the Chinese feel this way. There is a certain segment of any population that has deep-seated resentment for someone or some group of people. Take for instance, the polarization that has occurred within the two-party system in this country. Why does it occur? Because the media and the political pundits have been successful in pushing peoples’ hot buttons. It has forced societal upheaval that will compound the issues surrounding this pandemic.
I have not heard the latest socio-economic data on the “end result” this pandemic could have on America, but if people do not become united in the effort to “stay at home” and slow down the spread of COVID-19, this pandemic will take more lives than the Civil War (1861-65) did. For those feeling “entitled” … you are “entitled” to your opinion … and you are “entitled” to stay home and be safe as well. Again, the larger the population center, the more likely the spread of the virus because people feel the need to be around other people.
“Gee, I just found out I have the coronavirus. I think I’ll go visit Grandma and give it to her. Then I’ll go visit my sister and give it to her and her kids. Then I’ll go to the local shopping mall and cough all over the place and give it to as many people as I can, because I have little regard for anyone else’s life if I’m on my way out the door!”
The foregoing paragraph may sound sarcastic; however, history has shown us that there are people out there in society who behave this way. Bottom line … if you treat the situation as that everyone you know has it … you are only safe at home. Like Dorothy said when she clicked her heels together 3 times … “There’s no place like home.”