Neil Garfield

2 Mar

Good input from Neil Garfield:


1. The matter at hand is not legal, it is political. Your strategy must be to force the Judge into a corner and give him a way out that applies only to this case. There are 80 million mortgages that could be effected by a broad ruling in favor of a borrower or against MERS. If you read my recent articles you will see what I perceive to be the problem. I have no doubt that we are right on the law “on all four corners” — but that has been the case from the beginning. Your strategy and tactics must be courageous and push the Judge into the corner with a court reporter taking down every word. Remind the court reporter that under law, she works for you and NOT the Judge, so unless YOU tell her stop taking things down, she is to continue regardless of instruction from the bench.

2. I don’t think any negative case is legally a problem because your legislature sucks when it comes to writing legislation. I’ll analyze Vawter if you want me to, but it is distinguishable on several grounds. It will be easy to characterize the Washington statute, taken together with other sections as unique or at least unusual (even if it really isn’t) and then find ways to distinguish your case from others (even if it a distinction without a difference). The strategy should be to get the Judge to agree with you on SOMETHING that is a lynchpin of your case and work it from there. This isn’t about all cases, it is about this case.

3. MERS information is coming out daily. You ALWAYS have the option of introducing new evidence that was unavailable at the time of the last motion when it comes to MERS. Remember that JPMorgan Chase abandoned MERS for the same reasons we attack it. They did that in 2009. They are a party in your case.

4. The line that I am encouraging lawyers to use now is that a pretender who could not normally plead much less prove a regular judicial foreclosure case should not otherwise be allowed to prevail just because the court doesn’t have time to hear the case on the merits. That seemed to change the minds of even some tough judges. You might want to try it.

5. If the above statement is true, then it is necessary to make sure the parties are aligned properly. Do some research on this and you’ll find it is a very powerful procedural tool. Simply stated, the alignment of parties MUST be that the party seeking affirmative relief is the Plaintiff and must plead a full case with sufficient facts and exhibits such that relief could be granted of all the allegations and exhibits were true. That party is always the pretender in a foreclosure action. The fact that the rules require the borrower to “speak up” do not change the basic rules of due process and civil procedure. If the borrower denies the default, the authenticity of the documents, or otherwise denies the standing of the pretender, then the judicial foreclosure is over even if we stay in the same venue. At that point, the pretender must plead and prove  their case. The only burden on the borrower is a denial, which if not made in good faith subjects the borrower and attorney  to various sanctions.

6. If the above statement were untrue, then we would see the confusion that is now apparent in Washington State— the borrower is required to anticipate the case of the pretender, plead it, deny it and then accept the burden of proof of proving the borrower’s denial when the other side has not filed any pleading and the facts showing the failure of the pretender to have the ability to win on the merits are uniquely in the hands of the pretender, who won’t give it up despite Federal Law (TILA and RESPA).

7. A direct appeal under original jurisdiction to the Supreme Court of your state in mandamus on this issue is appropriate and I believe likely to succeed if placed in the hands of a competent appellate attorney.

8. The cases that are being decided either at trial level or the appellate level, are mostly picking at hairs. The simple question is whether the pretender can avoid pleading untrue facts and thus avoid the requirements of proving facts that only the creditor could plead and prove. If the answer is that the pretender wins, then the floodgates they are so worried about will really open because it gives any speculator a chance to set aside a previous foreclosure or to foreclose on any property that appears to be in default. There is already a popular scam across the country in which non-owners rent out the house as long as they can — many times for years. This is only possible because of the moral hazard introduced by the reticence of courts to apply black letter law that has existed for centuries and which is necessary to maintain an orderly society with certainty in the marketplace that the rights clearly set forth in the contracts, laws, rules, regulations and common law precedent will be applied in a consistent manner.

9. An example is the notice of default. Under the PSA the servicer is required to keep paying the creditor even if the borrower stops. There is no default. There is potentially a claim by the servicer against the homeowner for unjust enrichment but it certainly isn’t secured.

10. WAIVER: You can’t waive fraud. Every one of these loan closings was conducted under false pretenses with the real party advancing funds absent from the table (hence the term “Table funded loan, because the name of the lender is not present). The documentation thus refers to a  transaction that never occurred. Beyond that, the lender received an entirely different package of documents with terms and parties completely unknown and undisclosed to the borrower. The borrower and the lender never appear on the same document. Hence the documentation refers to a transaction that did NOT occur and the transaction that DID occur in which money was loaned to the borrower, is without documentation of any kind — i.e., documentation in which the borrower and lender agree to the same terms and conditions. The reference to the promissory note is a fraud.

11. SINGLE TRANSACTION RULE, STEP TRANSACTION DOCTRINE: The lender would never have accepted the deal were it not for the documentation the lender received (the bogus mortgage backed securities with the infamous AAA ratings based in part on the infamous fraudulently inflated property appraisals, relied upon by both lender and borrower). The borrower would never have accepted a deal wherein the real value of the property was considerably less than the principal due on the loan. Any reading of any chain of securitization documents can arrive at only one conclusion — there was no liability intended to accrue in favor of the lender or investor nor any recourse except in the unlikely even some money was received by a sub-servicer (serving at the will of the Master Servicer whose existence is hidden from both homeowner and investor). The bogus “bond” received by the lender was never signed by the borrower and unknown to most borrowers even today. THIS IS WHY YOU MUST CONCENTRATE ON THE SINGLE TRANSACTION DOCTRINE USED IN TAX LAW AND OTHER CIRCUMSTANCES WHERE FRAUD IS ALLEGED OR AT LEAST INFERRED. If you allow yourself to be drawn into a fight over the hairs of an individual document that neither the borrower nor the lender signed or even knew about, you are falling into the rabbit hole.

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