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    Invalid Assignment defense

    I have been fighting foreclosure for close to 4 years.

    It has gone full circle, and after my answering the summons and complaint, they, the bank have gone ahead with a motion for summary judgement.

    To be very brief, in my case, there were two assignments in question. On the very same day, there were two simultaneous recordings, the first being from Mers to One West, the second from One West to Deutsche bank.

    Here is where my case lies. Both of the assignments were signed by the same person. The person who acted as vice president of Mers on the first assignment, also acted as the vice president of One West on the second assignment. This is almost is identical to the Silverberg case, where the motion was denied on standing.

    Has anyone had this happen in their case, and does anyone see the bank as having anything for this? Seems like the definition of self dealing to me.
    Last edited by AngelinaCat; 07-17-2012, 06:18 PM. Reason: to make this post easier to read. The size and bold formatting does not help.
    Filed Chap 7 Pro Se 11/09
    Discharged 4/10

    #2
    In the end, they just need to show up with the actual Promissory Note with the property endorsements. The promissory note is a bearer instrument if it is endorsed "in blank". You have to remember, that the "assignment" is only to protect other creditors, not the person who took out the mortgage (the mortgagor).

    As for Silverberg and other cases like it, the dismissal is based on the finding that MERS could never have assigned the mortgage since it never actually "held" the mortgage. In the past, the mortgages would be foreclosed in the name of MERS and the lender would physically send that blank endorsed mortgage to MERS so that they physically had it.

    Unfortunately, and I'm no legal scholar, Silverberg may be fact specific. In that case, the Silverberg's executed a consolidation agreement to take two mortgages and consolidate them into one. That may have caused the bifurcation of the loan, and is why the Justices found for Silverberg. I also take note that the case wasn't dismissed with prejudice and it was dismissed solely for lack of standing (locus standi).

    The question is, could the lender try again! Methinks so.

    (As for whether a Judge will entertain you, I can't tell you.)
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog

    Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

    Comment


      #3
      Right, only time will tell.

      Hopefully, July 29th. In NY, all mortgages must be recorded to be valid.

      In my case, in 2009, a robosigner, now famous, recorded an assignment that had all kind of math and numerical errors. In 2010, Mers filed a corrective assignement to fix the errors and transfer to One West, then to Deutsche, on the same day, in consecutive recordings. It even says on the first one that a simultaneous assignment would follow, further assigning it to Deutsche. However, they used one robosigner to sign as VP for both companies. Quite remarkable, and truly seems to be a new case for self dealing.

      I asked for the summary judgement to be denied, with a request to depose the person who signed the docs. Should be interesting, at least to me!
      Last edited by AngelinaCat; 07-17-2012, 08:17 PM.
      Filed Chap 7 Pro Se 11/09
      Discharged 4/10

      Comment


        #4
        Self dealing is not exactly the issue. Notes are assignable and there is nothing inherently wrong with simultaneous assignment so long as there is proper endorsement.

        Here is the rub, at the end of the day, presumably, you stopped paying the mortgage and are in default, sooner or later, a court is going to allow someone to foreclose.

        Comment


          #5
          Even more to HHM's point... there have been some Florida judges that don't really take to pro se mortgagors whom attempt to challenge documentation. There is at least one Judge who simply asks... "did you pay?" That's a tough question to answer! Of course, they should entertain real issues and concerns.

          If your assignment was wrong before the suit commenced, that is cause to have the case dismissed. I would think that you raising a genuine issue of paperwork issues, a summary judgment shouldn't be granted and it should go to trial. Unless you're asking for summary judgment in your favor at the time.
          Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
          Status: (Auto) Discharged and Closed! 5/10
          Visit My BKForum Blog: justbroke's Blog

          Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

          Comment


            #6
            There is just a lot of debate on the assignment issue. The main challenge for many courts has been that assignment is a UCC (uniform commercial code) issue and the intersection between UCC 3 (negotiable instruments, the assignment of the note) and UCC-9 (secured transactions). The UCC doesn't really seem to provide a "remedy" for the borrower for any violation. UCC-3 is about the rights and responsibilities between the person who assigns the notes and the person who receives. UCC-9, simply governs how secured transactions must be done.

            So, the courts are basically saying, the improper assignment is a fight for the parties involved in the assignment, so long as the party foreclosing has some colorable claim to be able to foreclose (basically, can present "some" evidence that they have the right to do so) they can foreclose. The borrower, you, don't have the right to raise the assignment issue because you are not harmed by the "assignment". The harm is to the party who actually holds the note and may not get the proceeds of sale, and to county governments since they aren't getting their recording fees (that is the main issue raised by the attorney generals).

            Also, in this context, assignment is the wrong terminology, we are talking about "negotiating" an instrument.

            In any event, good luck. Hopefully you survive the Motion for Summary Judgment. The issue on Summary Judgment is that the burden is "that there must be no material dispute of fact left for the trier of fact to determine". The rub is, the issue of standing is a preliminary matter that would normally get determined "pre-trial". So, unless you filed a Motion to Dismiss for lack of standing (or whatever your claim is), not sure you will survive the MSJ unless you have presented evidence that is inconsistent with what was presented in the MSJ.
            Last edited by HHM; 07-18-2012, 08:19 AM.

            Comment


              #7
              Originally posted by HHM View Post
              There is just a lot of debate on the assignment issue. The main challenge for many courts has been that assignment is a UCC (uniform commercial code) issue and the intersection between UCC 3 (negotiable instruments, the assignment of the note) and UCC-9 (secured transactions). The UCC doesn't really seem to provide a "remedy" for the borrower for any violation. UCC-3 is about the rights and responsibilities between the person who assigns the notes and the person who receives. UCC-9, simply governs how secured transactions must be done.

              So, the courts are basically saying, the improper assignment is a fight for the parties involved in the assignment, so long as the party foreclosing has some colorable claim to be able to foreclose (basically, can present "some" evidence that they have the right to do so) they can foreclose. The borrower, you, don't have the right to raise the assignment issue because you are not harmed by the "assignment". The harm is to the party who actually holds the note and may not get the proceeds of sale, and to county governments since they aren't getting their recording fees (that is the main issue raised by the attorney generals).

              Also, in this context, assignment is the wrong terminology, we are talking about "negotiating" an instrument.

              In any event, good luck. Hopefully you survive the Motion for Summary Judgment. The issue on Summary Judgment is that the burden is "that there must be no material dispute of fact left for the trier of fact to determine". The rub is, the issue of standing is a preliminary matter that would normally get determined "pre-trial". So, unless you filed a Motion to Dismiss for lace of standing (or whatever your claim is), not sure you will survive the MSJ unless you have presented evidence that is inconsistent with what was presented in the MSJ.


              Yes, that's exactly what we did. And, we did not ask for anything but to deny the summary judgement and continue to discovery so we could depose the VP of 2 companies.
              In response to the not pay the mortgage question, we are genuinely interested in getting through this so that we can pay the right party, and go forward once again. Should we defeat the summary judgement, it's my opinion that they may be ready to negotiate in a real manner that works for all parties.
              Filed Chap 7 Pro Se 11/09
              Discharged 4/10

              Comment


                #8
                Originally posted by HHM View Post
                Self dealing is not exactly the issue. Notes are assignable and there is nothing inherently wrong with simultaneous assignment so long as there is proper endorsement.
                Right, but it is one of the triable issues here, IMHO

                Here is the rub, at the end of the day, presumably, you stopped paying the mortgage and are in default, sooner or later, a court is going to allow someone to foreclose.
                And our real hope is to be able to negotiate with the true owner of the note, to go forward and get this over with. Otherwise, somewhere down the road, another institution could say, we own the note, you owe us the money!
                Filed Chap 7 Pro Se 11/09
                Discharged 4/10

                Comment


                  #9
                  Originally posted by newhope2011 View Post
                  [/COLOR]

                  Yes, that's exactly what we did. And, we did not ask for anything but to deny the summary judgement and continue to discovery so we could depose the VP of 2 companies.
                  In response to the not pay the mortgage question, we are genuinely interested in getting through this so that we can pay the right party, and go forward once again. Should we defeat the summary judgement, it's my opinion that they may be ready to negotiate in a real manner that works for all parties.
                  That is of concern, simply denials of the evidence and facts contained in a MSJ is not enough. YOU, need to submit evidence that raises an issue for trial. This can normally be done via a sworn affidavit. If you all you did was deny, the judge will likely grant the MSJ.

                  Comment


                    #10
                    Right, sorry, we did that, and had the opposition to motion for summary judgement filed by an atty. That was way over my pay grade!!
                    Filed Chap 7 Pro Se 11/09
                    Discharged 4/10

                    Comment


                      #11
                      newhope, I'm very interested in how your next court appearance turns out. If I'm reading this correctly, you've already gone through the Lis Pendens and Mandatory Settlement Conference stages. Now the bank is proceeding with the foreclosure and moving for a summary judgment. The bank's attorney also needs to have filed an affidavit attesting to the accuracy of the documents (mortgage, note, and all assignments).

                      New York is a very homeowner-friendly state for foreclosures, and some of the judges have acted on their own accord and helped the defendants (I think mostly out of embarrassment at a lopsided judicial process). Depending on how the summary judgement goes, the bank will either get an Order of Reference or you'll proceed to trial. If the bank gets the order of reference, they have little incentive to negotiate with you since foreclosing is now just a matter of time (but may still take a few years). If you proceed to trial, then they have a lot of incentive to reach an agreement.

                      As to whether you are actually negotiating with the true owner of the note, the only way to tell is to see if the original mortgage has been properly assigned to the foreclosing bank. From what I can tell from other published NYSC decisions, they are generally looking for the mortgage and note to be assigned together (and at roughly the same time). If the note and the mortgage get separated, that's when things get messy, and it gives you an opening to challenge the bank's validity as the true owner of the mortgage and note.

                      If you know who your judge is, I think there's a way to look up how he or she has handled other foreclosures.
                      // Non-consumer Ch 7 Filed on Oct-2012 // 341 Nov-2012 // discharge Feb 2013 // trustee's no distribution Jun 2013 // wondering about that foreclosure

                      Comment


                        #12
                        Originally posted by davetedge View Post
                        newhope, I'm very interested in how your next court appearance turns out. If I'm reading this correctly, you've already gone through the Lis Pendens and Mandatory Settlement Conference stages. Now the bank is proceeding with the foreclosure and moving for a summary judgment. The bank's attorney also needs to have filed an affidavit attesting to the accuracy of the documents (mortgage, note, and all assignments).





                        New York is a very homeowner-friendly state for foreclosures, and some of the judges have acted on their own accord and helped the defendants (I think mostly out of embarrassment at a lopsided judicial process). Depending on how the summary judgement goes, the bank will either get an Order of Reference or you'll proceed to trial. If the bank gets the order of reference, they have little incentive to negotiate with you since foreclosing is now just a matter of time (but may still take a few years). If you proceed to trial, then they have a lot of incentive to reach an agreement.

                        As to whether you are actually negotiating with the true owner of the note, the only way to tell is to see if the original mortgage has been properly assigned to the foreclosing bank. From what I can tell from other published NYSC decisions, they are generally looking for the mortgage and note to be assigned together (and at roughly the same time). If the note and the mortgage get separated, that's when things get messy, and it gives you an opening to challenge the bank's validity as the true owner of the mortgage and note.

                        If you know who your judge is, I think there's a way to look up how he or she has handled other foreclosures.

                        This part truly amazes me. There is no way anyone can approve of what happened here. It would be like you playing black jack in Atlantic City, with the dealer having his own hand as well as the house. He goes and deals you the cards, then deals himself and the house the cards he wants. Just think about it, really. One person sitting at a desk. First she has an assignment from Mers to One West. She signs as VP of Mers. Then, the next form that appears on her desk is the assignment from One West to Deutsche, so she signs that as VP of One West. Both docs get notorized by the same guy. The last time I checked, the notary asked me was I familiar with what I was signing, and I had to swear yes for her to notarize my docs. So the Plaintiffs law firm gets some asst secretary to say whatever they tell her to say. How does that help the mess the Banks have us in. PS; I love Brooklyn!!
                        Filed Chap 7 Pro Se 11/09
                        Discharged 4/10

                        Comment


                          #13
                          Judge Schack in Brooklyn (Kings County) pretty much asks the same question in various rulings, wondering whether one robosigner was conflicted in her dual roles. He's even dismissed some cases with prejudice. So while other parts of the country are rubberstamping bank foreclosures or are weary of homeowners trying to get a free ride, it seems that the banks managed to cross a line with the NY courts and several judges are not at all happy with how sloppy the plaintiffs have been with vital paperwork.
                          // Non-consumer Ch 7 Filed on Oct-2012 // 341 Nov-2012 // discharge Feb 2013 // trustee's no distribution Jun 2013 // wondering about that foreclosure

                          Comment


                            #14
                            Here is a case that sounds like mine. Hope the Judge see's this one!

                            Deutsche Bank v. Castellanos
                            2008NYSlipOp50033(U)

                            In Deutsche Bank v Castellanos, Judge Schack denied a renewed application for a judgment of foreclosure and sale due to the plaintiff’s lack of standing. He noted that the defects identified within his May 11, 2007, order remained unaddressed. Judge Schack points out that if the same person was acting as an officer of both the grantor and the grantee of the assignment that this would create a conflict rendering the conveyance void.
                            Filed Chap 7 Pro Se 11/09
                            Discharged 4/10

                            Comment


                              #15
                              Out of curiosity, what is the end game scenario you are "hoping" to achieve.

                              Comment

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