(OP-ED, first posted: September 18, 2018) —
The writer of this post is a paralegal and consultant to attorneys on matters involving chain of title, foreclosures and document manufacturing. The opinions expressed herein are that of the writer’s only and do not constitute legal or financial advice. Any use of the theories or ideas suggested in this post is entirely at your discretion and will probably result in disaster without the proper legal help.
This is one of those sections which describes HOW “the system of things” is supposed to work. We all know that it doesn’t always work the way it’s supposed to. As a matter of fact, we know that in most instances, especially involving the prosecution of foreclosures, it hardly works the way it’s supposed to, especially if judges have “an agenda” or are “incentivized” to act in the best interests of the banks. We simply can’t have the banks collapse now, can we? It is this kind of fallacy that has screwed up our entire chains of title, as well as our legal system, with bad legislation and bad case law.
What I focus on in this segment is past cases that reflect the way things are supposed to work versus when they don’t.
“UNCLEAN HANDS” VERSUS “FRAUD ON THE COURT”
This is a slippery slope for not only foreclose mill attorneys but also the courts that hear their complaints. The Appellate Courts of course can only rule on matters of error in the cases presented to them. They cannot hear the entire case re-litigated again; in fact, they won’t stand for it. Appellate Courts in Florida for example, especially the 3rd and 4th District Courts of Appeal, are famous for issuing “PCAs”, which basically means they are declining to hear the case and that the lower courts ruling stands as adjudicated. This is one of the reasons why I bring this subject matter up now, which is due to the inept behavior of some judges in the lower courts to “clear their dockets” in the interest of justice, when in fact, many of these judges are “seniors”, already drawing a pension, that have nothing to lose by kicking you to the curb. This is a serious false assumption on their part (the senior judges). I don’t care whether these judges are drawing a pension or not … they are not protected by sovereign immunity (and neither is the county that they are acting as an employee of, within the course and scope of ruling on foreclosure cases), when they step “outside of the box” and appear as an accessory to something more sinister. Sovereign immunity does not necessarily go away if an error is made. However, if the court gets notice of statutory and ethical violations and does nothing to stop it, sovereign immunity goes away and liability for some sort of “wrong” kicks in. Yet, no one is addressing this part of “the system of things” when in fact, it should rightfully be addressed and properly dealt with to the fullest extent of the law.
For the purposes of arguendo here, I focus on the state courts as well as the bankruptcy courts, because this is not something that can really apply to the extent that one would think in the federal court system because the federal judges are appointed for life. One attorney in Hawaii, Gary Victor Dubin, has likened being in federal court to committing suicide. I find no solace in federal court, given the dismal number of foreclosure cases successfully defended while bankrupting the debtors (borrowers of mortgage loans) who all came into the federal system seeking to “delay the inevitable”. Only an egregious act by the bank would warrant sanctions and there is no singular case that I can reflect on in a U.S. District Court wherein the judge superbly did “the right thing” the first time, without having to be reprimanded for his abusive rulings by the Appellate Court. Besides, federal courts do not like pro se litigants, as we discussed earlier. So why are you thinking federal court? While the FDCPA and FCRA take up a lot of the consumer-oriented litigation, it is safe to assume that these are mostly initiated in class-action form.
STATE COURT ACTIONS
JPMorgan Chase Bank NA v Pocopanni et al, 4th Jud Cir Ct No 16-2008CA-3989
In the foregoing case, the Hon. Jean Johnson did the right thing by calling the bank attorney’s behavior what it was … fraud on the court by Chase and Shapiro & Fishman.
US Bank NA v Harpster, Pasco Co Cir Ct No 51-2007-CA-6684 (Mar 25, 2010)
US Bank’s lawyers could not stand up to the scrutiny of an Affidavit submitted by the bonding company for Terry Rice, the employee who was notarizing documents within the David J. Stern law firm without having a valid commission by the Floria Secretary of State. The documents he notarized would come back to haunt him years later in another case in Pinellas County, Florida.
M&T Bank v Lisa D. Smith, St. Johns County, FL No CA09-0418
This case was submitted by Attorney Lynn Szymoniak in her review of dozens of cases where fraud on the court was met by Circuit Judge J. Michael Traynor’s Order of an evidentiary hearing with overtones of sanctions for not one, but three separate violations of behavior by the then-Marshall C. Watson law firm. The outcome is shown below:
M & T Bank v Smith_Order (Jun 10, 2010)
This is significant because Judge Traynor quoted Rule 4-3.3(a)(1) of the Rules Regulating the Florida Bar … “a lawyer shall not knowingly make a false statement of fact or law to a tribunal or fail to correct a false statement of material fact or law previously made to the tribunal by the lawyer.” (Dismissed with prejudice!)
OneWest Bank FSB v Drayton, 2010 NY Slip Op 20429, Sup Ct Kings County (Oct 21, 2010)
The late judge Arthur Schack had seen enough banking malarkey to last him a lifetime, calling out robosigner Erica A. Johnson-Seck and demanding an affidavit under oath of her employment history for the past three years and why a conflict of interest doesn’t exit in this case involving being a signer for MERS, a VP of IndyMac Bank and a VP of OneWest Bank, all in one felled swoop, warning the bank’s counsel that: “… the new standard Court affirmation form states that “[t]he wrongful filing and prosecution of foreclosure proceedings which are discovered to suffer from these defects may be cause for disciplinary and other sanctions upon participating counsel.”
BANKRUPTCY COURT ACTIONS
Sadly, homeowners are put between a rock and a hard place when it comes to phony assignments. Rather than believe the state court would entertain motions for fraud, which most homeowner litigants come running into court screaming, they think that filing bankruptcy will stop their foreclosure. One thing is for certain, whether the homeowner wins or not, bankruptcy court judges especially do NOT like to be lied to or have facts that are fraudulent or misleading proffered into evidence, as you shall see below in three different cases.
In re Taylor_US Bkpt Ct E.D. Penn No 07-15385-DWS (Apr 15, 2009)
This Pennsylvania bankruptcy case revealed that Fidelity (LPS) had (at that time) 39 of the 50 major banking institutions’ business in formulating documents for bringing foreclosures against homeowners (and just when you thought title companies only handled closings). Further, the Udren Law Firm got whacked for sanctions under Rule 9011 for attempting to “hide behind” LPS’s NewTrak computer system in processing HSBC’s proof of claim. While this is a rather lengthy opinion, the conclusion is clear!
In Re Tarantola, US Bkpt Ct D. Ariz No 4-09-bk-09703 (Jul 29, 2010)
If anything can be more blatant, Judge Eileen Hollowell is not one to f**k with. In one of several Memorandum Decisions, this case really “takes the cake” in the “movant filed its motion without evidentiary support of its claims, attempted to create such evidentiary support after the fact, and only disclosed its “real” evidence on the day of the final evidentiary hearing.” (Relief from stay DENIED!) My understanding is that the court was packed with attorneys who got to witness Deutsche Bank’s counsel literally attempt to backpedal when cornered. The judge had the goods on them (and their lawyers)! I’m surprised that “the system of things” didn’t go further than it did and take them out of practice permanently. Sadly, McCarthy-Holthus (or some form of them) still exists; however, Brice, Vander Linden * Wernick, PC dissolved right after they became aware of their repeated “mentions” for illicit behavior in the Williamson County Real Property Records Audit in January of 2013. None of these attorneys were ever brought up on charges before their respective state bars and their E & O insurance policies still apparently exist. In my book, Judge Hollowell was being too kind.
In re Wilson_Show Cause Order, US Bkpt Ct E.D. La. No 11862 (Apr 4, 2012)
IN RE WILSON_LOUISIANA BK13_MOTION FOR SANCTIONS
Again, in the foregoing case, Fidelity and the Boles Law Firm got waylaid by Judge Elizabeth Magner, who tagged Wells Fargo Bank with a $1.3-million sanction (because the loss of money is the only thing that seems to get a bank’s attention). This case also illustrates how the major title companies are no friend of the homeowner. Title companies have to answer to state authorities (State Insurance Commissioners) too! Do you see where “the system of things” is going with this?
I realize I’m giving you a lot of reading to do in the foregoing scenarios … but I’m trying to illustrate how “the system of things” is supposed to work when the bank, through its attorneys, rely on phony documents that are manufactured to create standing to steal a home.
FORECLOSURE DEFENSE ATTORNEYS ARE SCARED OF THE JUDGE! BOO! (… and the attorney shits his shorts!)
I wrote in the 40-page piece (in which the expert witness attorney concurred) that foreclosure defense attorneys face a real dilemma. Like many foreclosure mill attorneys, they all have student loan debt into the tens, maybe even hundreds of thousands of dollars. They got a 4-year degree in addition to 3+ years of law school, had to study and then sit for the state bar exam and face moral turpitude scrutiny in order to get a license to practice law from the state (what the state giveth, the state can taketh away)!
It’s no wonder they’re all scared. They don’t want to face sanctions. They want to be a friend to everybody, including the other side’s lawyers that are trying to steal their clients’ homes. No attorney has the set of cajones to stand up to these shysters unless they have a snoot-full of evidence that can conclusively prove that the other side has come to court with unclean hands. Which brings me to the HSBC v. Buset case:
HSBC Bank USA NA v Buset_Final Order Granting Mtn for Involuntary Dismis…
HSBC Bank USA NA et al v Buset et al, 3D16-1383 (Feb 7, 2018)
Sadly, Florida’s 3rd DCA reversed Judge Butchko’s ruling, to which Buset’s attorney, Bruce Jacobs told me, “This is war!” (in other words, “this ain’t over yet”).
Part of the problem might be that the expert witness in this case was NOT an attorney with the capability of reporting the fraudulent and misrepresentative assignments to the Florida Bar. Attacking an appellate court is virtually unheard of … that is, until we find out who cuts their paychecks and who bonds them. Every judge is supposed to be bonded, even the senior “fossils” brought out of mothballs that have no problem throwing homeowners out of their homes because they can, without retribution (or so they think). If the judge commits an illegal act, not only can he be removed from the bench, the county he serves as a judicial officer in can be held liable in certain cases!
We are not asking the homeowner’s attorney to stand up and be counted (challenging the other side’s credibility, screaming “fraud on the court”, etc.). We let the expert witness attorney do that. The bank’s lawyer has every opportunity to recant his testimony in both his pleadings and in his oral statements. If he refuses to do so, then he can pay the price. We just want the homeowner’s attorney to get the expert witness attorney on the stand and ask him a series of questions. In other words, we just want the attorney for the homeowner to do his job!
In previous posts of this nature, we talked about the insurance factor. The direct frauds promulgated by these law firms could have resulted in attacks against their E & O policies, but didn’t. Any judge who didn’t do the right thing in running a proper tribunal could have faced a judicial review board and lost his bond because it would have been “attacked” and challenged as well. If a law firm doesn’t get payment for legal fees when its lawyers face the music before their respective bar disciplinary panels, then they have to come up with that money out of their own pockets, which while not being a benefit to the homeowner, it is a bitter detriment to the lawyer, who now has to think about how he’s going to pay off that big student loan debt he’s got in addition to $10-$20K in legal fees incurred as the result of his disciplinary proceeding!
The judge who can’t “do the right thing” represents the county government’s judicial process and has the privilege of sovereign immunity, UNLESS he condones felony behavior in his court. Then his sovereign immunity can not only be at risk, the county’s general treasury may be raided to pay for the damage he caused! How’s THAT for justice!
But wait, there’s more … stay tuned!