July 27, 2015

Last Friday, July 24, a Franklin (Williamson County), Tennessee Circuit Judge ruled against BNY, denying its Motion to Dismiss and staying a foreclosure. Per our prior post, last Monday, July 20, a Circuit Judge in Dandridge (Jefferson County), Tennessee also ruled against BNY denying its motion to dissolve a restraining order precluding any sale of the property during the course of the homeowners’ challenge to the foreclosure. The homeowners in that case are represented by Jeff Barnes, Esq. and local TN counsel Andrew Farmer, Esq.

The Franklin case involves MERS and BNY as the alleged trustee of a Countrywide securitization where two separate trusts are claiming ownership of the loan (a CWMBS and a CWALT). Jeff Barnes, Esq. represents the homeowners together with local TN counsel John Higgins, Esq. Mr. Barnes and drafted the opposition to BNY’s Motion to Dismiss, and the Judge issued his ruling in open court without any oral argument, although counsel for BNY repeatedly challenged the Judge’s oral pronouncement that he was denying BNY’s motion.

The MERS issues are currently on appeal in Tennessee following the Ditto decision which, like many other appellate courts throughout the US, held that MERS has no independent interest in real property and no protected interest in real property by being named beneficiary or nominee, and cited case law that MERS is contractually prohibited  from exercising any rights with respect to mortgages including foreclosure.

The rulings on Monday and Friday of last week, in both eastern and middle Tennessee, demonstrate that Tennessee courts are no longer blindly accepting the “we have the Note, therefore we win” position consistently taken by the “banks” and servicers.

Jeff Barnes, Esq., www.ForeclosureDefenseNationwide.com

July 21, 2015

Yesterday, a Dandridge (Jefferson County), Tennessee Circuit Court Judge declined, for the second time in 30 months, to dissolve a restraining Order precluding any nonjudicial sale and also declined to require the homeowners to post a bond as a condition of precluding any sale in a Bank of NY securitization case involving America’s Wholesale Lender (AWL) as the alleged original lender. The Judge’s ruling reiterates the Court’s previous denial of the same request made by BNY back in 2012.

Jeff Barnes, Esq. represents the homeowners together with local TN counsel Andrew Farmer, Esq. Mr. Barnes wrote the responsive brief and argued the matter yesterday in the Jefferson County courthouse in Dandridge, TN.

The homeowners originally filed suit in 2010 challenging BNY’s alleged right to seek a non-judicial foreclosure. The Circuit Court Judge entered a restraining order on Motion of the homeowners prepared and filed by Mr. Barnes. No bond was required as Rule 65.05(1) of the Tennessee Rules of Civil Procedure provides that a bond is for the payment of costs and damages which the party being enjoined may be shown to have suffered while being enjoined. The intent of the Rule is that there has to be evidence of such damages, which go in part into the future. BNY presented no such evidence, and the homeowners are challenging BNY’s standing to seek any relief at all.

BNY had also previously filed a Motion to Dismiss the homeowners’ Complaint, which Motion was denied. BNY had also moved to stay discovery, which was also denied.

In the 30 months since the entry of the original restraining Order, BNY did nothing to appeal or otherwise challenge the Order, and presented no evidence of any alleged damages being suffered while being enjoined from selling the property during the pendency of the litigation. The Judge stated “the Defendant [BNY] is no worse off than it was back in 2012”.

The homeowners are not only challenging BNY’s lack of standing to seek any relief due to no evidence of a lawful transfer to the securitization trust, but also that the loan may have been paid down or paid off from insurances, credit default swaps, and the like. They are also challenging any alleged right to enforce the loan in view of the Nash decision from Florida which found that AWL never existed and the loan was thus void resulting in no valid obligation to enforce. The Judge stated that “these are legitimate questions”.

In the end, the Judge stated that he had not been presented with any evidence by which he could calculate a bond, especially as the question of who owns the loan remains unanswered, and thus continued the imposition of the restraining Order without the requirement of a bond.

Jeff Barnes, Esq., www.ForeclosureDefenseNationwide.com

July 10, 2015

Yesterday, an Oregon Circuit Court Judge issued a detailed, multi-page ruling denying BONY’s Motion for Summary Judgment in a case involving a purported transfer of a loan (allegedly) originated by America’s Wholesale Lender to a securitization trust. The ruling is of statewide significance for several reasons, including the fact that there is presently no Oregon appellate law on the issues.

Jeff Barnes, Esq. represents the homeowners together with local Oregon counsel Philip Anderson, Esq. The Motion was argued in open court by Mr. Barnes, who drafted the responsive papers, on June 25, with the ruling being issued late yesterday afternoon.

Oregon has four issues in a judicial foreclosure, the first being whether the foreclosing party is the “PETE” (person entitled to enforce). The Court denied BONY’s MSJ on this threshold requirement, and based on the arguments made by Mr. Barnes and the filing of an ORCP 47E Affidavit as to an expert witness, permitted the homeowners to present expert testimony as to the authenticity and legal relationships involved in the transaction, citing a recent (2015) Oregon appellate decision on the issue of the scope and requirements of Rule 47E Affidavits.

BONY had argued that no expert testimony was needed in what it called “a simple foreclosure case” The 2015 case sets forth that such Affidavits need only to contain certain language and are evaluated in view of the theory of the case. This case involves numerous complex issues including but not limited to the America’s Wholesale Lender issues (previously discussed on this website) and the securitization issues, including the legitimacy of any alleged transfer under the factual circumstances of the case.

The second and perhaps most important ruling was that the Court, in denying summary judgment on BONY’s claim that the homeowners did not have standing to challenge the sale, transfer, and assignment of the Note and DOT, held that the homeowners do have such standing “to challenge the legitimacy of Plaintiff’s claim that they, as the alleged assignee, possessor, and holder of the Note and Deed of Trust, are the proper party to enforce them.”

This ruling is in accord with the U.S. Court of Appeals for the 6th Circuit’s October, 2014 opinion in the Slorp v. Lerner decision (previously discussed on this website) which clarified the flawed and improperly narrow interpretation of the 6th Circuit’s prior opinion in the 2010 Livonia Properties case, which bank and servicer attorneys (erroneously) argued precluded homeowner challenges to assignments and transfers of mortgage loans. The 1st Circuit Court of Appeals is also in accord pursuant to its holding in the Cosajay decision, which held that its “decision finding standing is buttressed by Defendants’ extreme and incongruous argument that would allow Ms. Cosajay no relief because she is not a party to the assignment.”

The case now progresses to full trial on the merits, including the issues involving the alleged “loan” by America’s Wholesale Lender; whether there was any interest to transfer, etc.

Jeff Barnes, Esq., www.ForeclosureDefenseNationwide.com

July 9, 2015

We hope everyone had a safe and happy July 4th holiday. Mr. Barnes recently completed a month-long “tour of duty” throughout the US involving trials and hearings in several states including Florida, Oregon, Tennessee, Illinois, and Colorado, and is preparing for another battery of court appearances in New Jersey, Colorado, Florida, and Tennessee.

The Florida 4th District Court of Appeal has reversed a Final Judgment of Foreclosure which a Ft. Lauderdale, Florida Circuit Judge had entered in favor of JPMorgan Chase Bank; dismissed the foreclosure due to lack of standing; and directed that judgment be entered in favor of the homeowner in the matter of Wright v. JPMorgan Chase Bank N.A., 4th DCA Case No. 4D14-565. We thank one of our dedicated followers for bringing this case to our attention.

The case is of particular interest as the original Note was in favor of Chase Bank USA, which JPM claimed to be its wholly-owned subsidiary. JPM argued that it obtained servicing rights over the loan and that as the parent company of the wholly owned subsidiary, it had the right to enforce a Note in favor of its subsidiary.

The 4th DCA disagreed, holding that Chase Bank was a separate legal entity and as such, the parent company could not exercise the rights of a subsidiary, citing two appellate decisions on this issue. The Court held that absent evidence that the loan was purchased by JPM, it could not enforce the Note. JPM did not introduce any purchase agreement or other evidence that it had acquired the Note.

The Florida 4th DCA has consistently been one of the few appellate courts in the entire country to really examine the issues involved in foreclosures and hold the foreclosing party to its legal burdens. Other Florida appellate courts are recently beginning to do likewise.

We have been receiving many inquiries since our publication on the America’s Wholesale Lender issues raised by the Nash decision in Florida. Mr. Barnes currently has cases pending in two states on the issue of whether AWL ever legally existed and thus whether any alleged “successor” thereto may seek to enforce a Note in favor of a non-existent, unlicensed mortgage “Lender.”

Jeff Barnes, Esq., www.ForeclosureDefenseNationwide.com