Archive | December, 2011

DON’T LET THEM DO IT!!!!!

16 Dec

From: Charles Cox [mailto:charles@bayliving.com]
Sent: Friday, December 16, 2011 9:48 AM
To: Charles Cox
Subject: DON’T LET THEM DO IT!!!!!

AG Settlement: 3 1/2 cents on the dollar

by Neil Garfield

EDITOR’S NOTE: Calculated Risk has the right idea but the wrong calculation. It is relying on published reports of underwater houses and the amount they are underwater. The true figure is at least $1.4 trillion, which would make the settlement around 1.75 cents on the dollar. And it does not include all the foreclosures that went forward even though the homeowner was seeking modification that would present affordable payments and a better return to investors than foreclosure.

This so-called settlement is nothing more than a public relations stunt. It insures that money and politics will continue to be mixed together. It is virtual amnesty. An attorney general is charged with protecting citizens of the state.

by CalculatedRisk SEE ARTICLE

I missed this last week from Adam Belz at the Des Moines Register: Iowa AG says mortgage settlement should be done by Christmas (ht Kevin)

Iowa Attorney General Tom Miller said Thursday a settlement between almost all state attorneys general and the five largest mortgage servicers should be finalized before Christmas, with or without California.

The deal, which Miller has been trying to negotiate since March, would release the five servicers – Ally Financial, Bank of America, Citigroup, J.P. Morgan Chase, and Wells Fargo – from legal claims on past home loan servicing and foreclosures. The deal would not prohibit individuals from suing the banks, or government prosecutors from suing banks over issues related to the packaging of home loans into mortgage-backed securities.

In return the banks will agree to pay for what Miller calls “substantial principal reductions” for homeowners who are underwater, and agree to a set of mortgage servicing standards, interest rate reductions, and cash payments to some homeowners who’ve alrady gone through foreclosure.

>And from Bloomberg today: Ex-Cuomo Aide Said to Be Among 4 Foreclosure-Monitor Candidates

Steven M. Cohen, who was the governor’s secretary, is one potential foreclosure monitor, according to the person, who declined to be identified because the negotiations are secret. That person said North Carolina Commissioner of Banks Joseph A. Smith Jr. is also a candidate, as did a second person who asked not to be identified.

Selection of a monitor is one of the final issues to be worked out between the banks and state and federal officials, said the people. Selection of the monitor is a key issue for the regulators because success of the agreement will largely depend on his or her work, one of the people said.

Other candidates are Nicolas P. Retsinas, a former assistant secretary of the U.S. Department of Housing and Urban Development, and ex-Federal Deposit Insurance Corp. Chairman Sheila Bair, one of the people said.

The discussion of possible principal reductions is too optimistic. They are discussing something like a $25 billion settlement (including California) and only a portion would be for principal reductions. Currently, according to CoreLogic, homeowners with negative equity (including 2nd liens) are an aggregate $699 billion underwater. Even if the entire settlement went to principal reductions, the average underwater homeowner would only see a few percent of their negative equity eliminated.

The major impact from this settlement on the housing market would be to reduce the number of seriously delinquent loans – either by modifications (including principal reductions) or through foreclosures. Currently, according the LPS

Congress Questions Impartiality of Independent Foreclosure Reviews (duh!!!) | STEAL HUNDREDS OF MILLIONS, PAY FINES WITH THE MONEY YOU STOLE. |

15 Dec

From: Charles Cox [mailto:charles@bayliving.com]
Sent: Thursday, December 15, 2011 8:33 AM
To: Charles Cox
Subject: Congress Questions Impartiality of Independent Foreclosure Reviews (duh!!!) | STEAL HUNDREDS OF MILLIONS, PAY FINES WITH THE MONEY YOU STOLE. |

Congress Questions Impartiality of Independent Foreclosure Reviews

By: Krista Franks 12/14/2011

At a Senate subcommittee hearing held this week to examine the progress of the foreclosure review process ordered earlier this year by the Office of the Comptroller of the Currency (OCC) and the Federal Reserve, lawmakers questioned the impartiality of the “independent reviews.”

The consent orders designed in April call for the independent review of about 4.5 million foreclosure actions by 10 servicers to determine instances in which borrowers were financially harmed and compensate those borrowers.

Julie Williams, first senior deputy comptroller and chief counsel for the OCC, attempted to assure the senators posing questions that the reviews would be unbiased.

Williams explained that the banks proposed the independent consultants, and the OCC and Federal Reserve reviewed the proposals and rejected those in which they found a conflict of interest.

When asked if many of the approved consultants have worked with the servicers previously, Williams admitted that some had. “There are a number of situations where they have done previous work for the servicers in different areas, generally, but they have had previous business engagements with those servicers.”

“This raises questions about the true independence of these organizations,” Sen. Jack Reed (D-Rhode Island) stated.

In her testimony, Williams stated that the OCC is requiring the independent reviewers to “ensure its work under the foreclosure review would not be subject to direction, control, supervision, oversight, or influence by the servicer, its contractors, or agents.”

In its written testimony, the Federal Reserve corroborated Williams’s claim. “In determining the acceptability of consultants, the Federal Reserve closely scrutinized their independence,” stated Scott G. Alvarez, general counsel for the Federal Reserve.

“Everyone involved in this process – the residential mortgage loan servicers, consultants and the regulators – has the desire to get it right,” stated Paul Leonard, vice president of the Housing Policy Council/The Financial Services Roundtable.

Another witness at the hearing expressed an entirely different set of concerns. “My concern is not with the selection of independent consultants, but with the time and costs involved in such a laborious review process relative to the expected economic assessment of harm,” stated Anthony B. Sanders, professor of real estate finance at George Mason University.

Sanders suggests out of the 4.5 million loans, there may be 100 instances of “egregious errors.”

“Once the review is completed and the remediation for financial harm is concluded, I urge everyone to put the foreclosure issue aside and allow the market to heal itself,” Sanders stated.

Meanwhile, servicers will have sent more than 4 million letters by the end of this year and will begin an advertising campaign beginning early 2012 to inform borrowers that they can request an independent review of their foreclosure action.

In addition to a sample set of foreclosure actions, independent reviewers will examine all foreclosure actions on military members covered by the Servicemembers Civil Relief Act, borrowers who previously filed a complaint regarding their foreclosure, and “high risk” cases involving bankruptcy.

©2011 DS News. All Rights Reserved.

MERS as a “sham” rebuffed by the Ninth Circuit

15 Dec

From: Charles Cox [mailto:charles@bayliving.com]
Sent: Thursday, December 15, 2011 2:19 PM
To: Charles Cox
Subject: MERS as a "sham" rebuffed by the Ninth Circuit

MERS as a “sham” rebuffed by the Ninth Circuit

· Morrison & Foerster LLP

· Greg Dresser

· USA

·

· December 6 2011

The Ninth Circuit rejected a putative class action alleging lenders conspired to defraud borrowers through the Mortgage Electronic Registration System (“MERS”)—a private electronic database tracking the transfer of interests in loans. Cervantes v. Countrywide Home Loans, Inc., 656 F.3d 1034 (9th Cir. 2011). In affirming dismissal, the Ninth Circuit held plaintiffs failed to state a claim for any underlying fraud. Their allegations missed key elements: that plaintiffs were misinformed about MERS, reliance, and injury. The Ninth Circuit also held that because the standard deeds of trust disclosed MERS’s role and right to foreclose, plaintiffs had agreed to those terms and were on notice. The Ninth Circuit rejected plaintiffs’ core theory that no entity could foreclose because MERS splits the deed from the note. It held that “the notes and deeds are not irreparably split: the split only renders the mortgage unenforceable if MERS or the trustee, as nominal holders of the deeds, are not agents of the lenders.”

MARK J. DEMUCHA AND CHERYL M. DEMUCHA, a Reply Brief that worked

14 Dec

No. F059476

IN THE COURT OF APPEAL FOR THE STATE OF CALIFORNIA

FIFTH APPELLATE DISTRICT

                                                                                                                                                           

Wells Fargo in Laredo, Texas

Image via Wikipedia

Appellants and Plaintiffs

v.

WELLS FARGO HOME MORTGAGE, INC.; WELLS FARGO BANK, NATIONAL ASSOCIATION a.k.a. WELLS FARGO BANK, N.A.; FIRST AMERICAN LOANSTAR TRUSTEE SERVICES; FIRST AMERICAN CORPORATION; AND DOES 1 TO 45

Respondents and Defendants

                                                                                                                                                           

Appeal from the Superior Court of the State of California, County of Kern

Case No.  S-1500-CV-267074

Honorable SIDNEY P. CHAPIN, Judge

Department 4

Tele: 661.868.7205

                                                                                                                                                           

REPLY BRIEF OF APPELLANTS MARK J. DEMUCHA AND CHERYL M. DEMUCHA

                                                                                                                                                           

Michael D. Finley, Esq.

Law Offices of Michael D. Finley

25375 Orchard Village Road, Suite 106

Valencia, CA 91355-3000

661.964.0444

Attorneys for Plaintiffs-Appellants,

MARK J. DEMUCHA and CHERYL M. DEMUCHA

TABLE OF CONTENTS

TABLE OF AUTHORITIES                                                                                                        ii

INTRODUCTION                                                                                                                         1

STATEMENT OF THE FACTS                                                                                                  2

PROCEDURAL HISTORY                                                                                                          4

STANDARD OF REVIEW                                                                                                          4

ARGUMENT                                                                                                                                5

A.   THE DEMURRER WAS NOT PROPERLY SUSTAINED                                    5

B.   THE COMPLAINT VERY PLAINLY CONTAINS A
TENDER, EVEN THOUGH IT IS NOT REQUIRED FOR
A QUIET TITLE ACTION                                                                                        5

C.   SUSTAINING OF THE DEMURRER WAS REVERSIBLE
ERROR BECAUSE CALIFORNIA LAW REQUIRES
WELLS FARGO TO POSSESS THE NOTE IN ORDER TO
ENFORCE THE LOAN                                                                                             7

D.   THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS
REGARDING THE PROPRIETY OF SUSTAINING THE
DEMURRER ON THE CLAIMS TO QUIET TITLE AND
REMOVE CLOUD ARE BASED UPON THE DELIBERATE MISREPRESENTATION OF THE NATURE OF THE
DEMUCHAS’ COMPLAINT                                                                                   8

E.    THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS
REGARDING THE PROPRIETY OF SUSTAINING THE
DEMURRER ON THE CLAIM FOR FRAUD AND MISREPRESENTATION ARE BASED UPON THE
DELIBERATE MISREPRESENTATION OF THE CONTENT
OF THE DEMUCHAS’ COMPLAINT                                                                    9

F.    THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS
REGARDING THE PROPRIETY OF SUSTAINING THE
DEMURRER ON THE CLAIM FOR INFLICTION OF
EMOTIONAL DISTRESS ARE BASED UPON THE
DELIBERATE MISREPRESENTATION OF THE CONTENT
OF THE DEMUCHAS’ COMPLAINT                                                                    9

G.   THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS
REGARDING THE PROPRIETY OF SUSTAINING THE
DEMURRER ON THE CLAIM FOR SLANDER OF
CREDIT ARE BASED UPON THE DELIBERATE MISREPRESENTATION OF THE CONTENT OF THE
DEMUCHAS’ COMPLAINT                                                                                  10

H.   THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS
REGARDING THE PROPRIETY OF SUSTAINING THE
DEMURRER ON THE CLAIM FOR INFLICTION OF
EMOTIONAL DISTRESS ARE BASED UPON THE
DELIBERATE MISREPRESENTATION OF THE
CONTENT OF THE DEMUCHAS’ COMPLAINT                                               10

CONCLUSION                                                                                                                            10

TABLE OF AUTHORITIES

CASES

                                                                                                                                                     Page

Caporale v. Saxon Mortgage, Bankr. North Dist. Cal., San Jose Case No. 07-54109.                  8

In re Foreclosure Cases, 2007 WL 3232430 (Bankr. N.D. Ohio 2007).                                        8

Staff Mortgage v. Wilke (1980) 625 F.2d 281                                                                               8

Starr v. Bruce Farley Corp. (9th Cir. 1980), 612 F.2d 1197.                                                           8

Whitman v. Transtate Title Co. (1985) 165 Cal.App.3d 312, 322-323.                              6

STATUTES

Commercial Code § 3301.                                                                                                     7, 8, 9,

INTRODUCTION

            Defendants/Respondents continue to mischaracterize the Plaintiffs’/Appellants’ complaint very deliberately, apparently because they realize that the Plaintiff’s complaint as actually plead is beyond their ability to oppose it. Calling the Plaintiffs’ Complaint “inartfully drafted” because it does not state that it is a challenge to a non-judicial foreclosure is wishful thinking. The complaint is very artfully drafted as a Quiet Title action. The plaintiffs are not seeking to “stave off foreclosure of a mortgage,” but seeking to remove a false claim against their title to the property. No non-judicial foreclosure has taken place. No foreclosure sale has occurred, so there is no foreclosure sale to challenge or undo, but the Defendants/Respondents insist on arguing the case at the demurrer level and on this appeal as a complaint to challenge or set aside a non-judicial foreclosure and keep trying to apply those inapplicable pleading requirements to the complaint. The plaintiffs did seek a preliminary injunction against the foreclosure and obtained it because the Defendants/Respondents did not comply with the laws regarding non-judicial foreclosure. However, that does not make their complaint a “central defense” to non-judicial foreclosure as Defendants/Respondents argue throughout their brief. The mischaracterization of the case was a key element of the lower court’s error and continues to be a key element of the Defendants’/Respondents’ false arguments.

Further, Plaintiffs/Appellants never argued that producing the note was a preliminary requirement to non-judicial foreclosure, but Plaintiffs/Appellants have plead very specifically throughout the complaint that possessing the note is a requirement for the Defendants/Respondents to have any right to enforce the note whatsoever, which has been established California law (and in every state that has adopted the Uniform Commercial Code) for a very long time. The references to producing the note were merely offered as evidence demonstrating that the Defendants/Respondents do no possess the note because they repeatedly fail and refuse to produce it. In fact, it is important to note that the Defendants/Respondents have never yet argued that the note is in their possession as required by law.

STATEMENT OF THE FACTS

A.        THE SUBJECT TRANSACTION.

The Defendants’/Respondents’ Statement of Facts has a very subtle attempt at subterfuge and misdirection in that it places a statement made about their finances during litigation after Plaintiffs/Appellants incurred legal fees in a different context as though the statement were made prior to litigation during the time that the prior (and possibly current) note holder CTX Mortgage had the loan and prior to the recording of the notice of default. Defendants/Respondents have gone to great lengths to take this statement out of context and have argued extensively that this constitutes proof that the Plaintiffs/Appellants were unable to tender payment. However, this requires the assumption that only one conclusion may be drawn from the statement rather than a range of possibilities, including the fact that the Plaintiffs/Appellants had incurred attorney’s fees by that time.

B.        THE DEMUCHAS’ CONTENTIONS.

As in the underlying Demurrer, the Defendants/Respondents continue to falsely argue that there was no allegation of Tender in the Complaint. However, as demonstrated in the Appellants’ Opening Brief, there is no requirement of tender to plead Quiet Title. Even so, the Defendants/Respondents quote the allegation of tender that is in the Complaint even while arguing that there is no allegation of tender. This demonstrates the Defendants’/Respondents’ motive in deliberately mischaracterizing the complaint: they wish to apply a non-applicable standard to the complaint. Then when the non-applicable standard has been complied with anyway, they attempt to mislead the court by arguing that a plain allegation of tender is not an allegation of tender. However, as will be shown, the Defendants/Respondents have cited a case that states that tender can be offered in the complaint, and need not have been offered prior to filing the complaint.

C.        DEFENDANTS’/RESPONDENTS’ ASSERTION OF NO ALLEGATION OF TENDER OF ALL AMOUNTS DUE IS BLATANTLY FALSE.

As stated above, Plaintiffs/Appellants have already demonstrated that tendering payment is not a required element of a Quiet Title action, but that they have pleaded tender anyway. The Defendants’/Respondents’ arguments that payments must be tendered “when due” misstates the law, even for cases challenging non-judicial foreclosures, which this case is not. As will be shown below, the Defendants/Respondents cited a case that indicates very clearly that even in non-judicial foreclosure cases, a tender may be made in the complaint and need not have been made prior to filing the complaint.

D.        THE FORECLOSURE PROCEEDINGS AND THE DEMUCHAS’ ATTEMPTS TO DELAY OR HALT THEM.

The Defendants/Respondents’ focus on these extra proceedings within the case is a red herring to distract the court’s focus from the demurrer. The appeal is not about the ex-parte application for a preliminary injunction that was granted due to the fact that the Defendants/Respondents did not comply with California law requiring a specific declaration to be signed under penalty of perjury that was not. The Defendants/Respondents are going well outside the Complaint’s four corners to abuse the details of the ex-parte application that was not about the Complaint nor the Demurrer that are the subjects of this appeal. And once again, they are trying to argue the issue of the Plaintiffs’/Appellants’ financial situation as stated during the ex-parte proceedings after they had already incurred attorney’s fees for the false proposition that the Plaintiffs/Appellants were allegedly incapable of tendering payment prior to incurring the additional attorney’s fees of litigation when that is not the only conclusion that can be drawn from the separate ex-parte pleadings. Finally, they continue to shout endlessly about the issue of tender when it is not a required part of pleading the elements of Quiet Title and when pleading tender is required, an offer made in the complaint itself is deemed sufficient, as will be shown below.

E.        THE ARGUMENTS ABOUT FAILURE TO “PRODUCE THE NOTE” ARE A RED HERRING TO DISTRACT THE COURT FROM THE LEGAL REQUIREMENT THAT THE DEFENDANTS “POSSESS THE NOTE.”

The Defendants/Respondents continue to make a big deal about the fact that in a few places, the Complaint mentions that the defendants have failed to produce the original note. However, their own arguments on this point mention that the complaint further alleges their failure to hold or possess the original note, which is the more key portion of the pleadings.

PROCEDURAL HISTORY

            The parties’ explanations of the case’s procedural history are close enough that no further discussion is necessary.

STANDARD OF REVIEW

            Some of the arguments contained in the Defendants’/Respondents’ Standard of Review section of their brief are specious, especially in the final paragraph arguing the subjects of tender and producing the note. The Defendants/Respondents have never demonstrated that California law requires an allegation of tender for a Quiet Title action, but have only cited as authority for this position cases that are focused on undoing a foreclosure sale after it has been completed. However, even those cases state that tender does not have to be made before filing the complaint, but the tender itself can be made within the complaint, and there cannot be any question that an offer of tender is made within the complaint. The Plaintiffs’/Appellants’ current attorney helped prepare pleadings for them in the trial court case and even made special, limited scope appearances for them, even though they were officially in pro per, so they incurred considerable legal fees during the litigation, which certainly had an effect on their financial situation at the time that they filed their ex parte application for a preliminary injunction, so the Defendants’/Respondents’ argument that the ex parte papers demonstrate that the Plaintiffs/Appellants could not tender payment is false. Further, the Defendants’/Respondents’ argument that “the central premise of each cause of action of the DeMuchas’ First Amendent Complaint [is] that a lender must ‘produce the note’ while conducting a non-judicial foreclosure” is a blatant misstatement of the Complaint’s content. The Complaint is not about non-judicial foreclosure, it is about quieting title. And the central premise is that a lender must possess the note in order to have a right to enforce the note, which is the law in California and every other state that has adopted the Uniform Commercial Code. No non-judicial foreclosure has yet taken place regarding the subject property.

ARGUMENT

A.        THE DEMURRER WAS NOT PROPERLY SUSTAINED.

Defendants/Respondents are demonstrating to this court the same misdirection and deliberate mischaracterization of the pleadings that misled the trial court into committing reversible error by improperly sustaining a demurrer to a valid complaint. The Defendants/Respondents have never demonstrated that tender is a requirement for a Quiet Title action. They have mischaracterized the case as a case to undo a non-judicial foreclosure when no non-judicial foreclosure has ever been completed regarding the subject property. The cases that they cited to the trial court and to this court regarding the requirements of a tender allegation were cases in which the subject property had been sold at a non-judicial foreclosure sale, which was being challenged after the fact. They have mischaracterized the Complaint’s allegations as though they state that “producing the note” is a requirement for non-judicial foreclosure, which is a blatant misstatement. The complaint states the true fact that the defendants have failed and refused to produce the note only as evidence of the fact that they do not possess the note and therefore have no right to enforce the note under California law. It is worth noting that the Defendants’/Respondents’ 34-page Appellate Brief never claims that they are the holders of the note as required by law.

B.        THE COMPLAINT VERY PLAINLY CONTAINS A TENDER, EVEN THOUGH IT IS NOT REQUIRED FOR A QUIET TITLE ACTION.

Defendants/Respondents continue their same improper tactic used with the trial court of citing irrelevant cases seeking to undo a foreclosure sale after the fact. Since no foreclosure sale has yet taken place regarding the subject property and this is a Quiet Title action, those cases are all irrelevant and inapplicable to the First Amended Complaint that is the subject of the Demurrer and this appeal. However, even under the Defendants’/Respondents’ inapplicable cases, the Defendants/Respondents have swerved into something that destroys their arguments completely: Citing Whitman v. Transtate Title Co. (1985) 165 Cal.App.3d 312, 322-323, the Defendants/Respondents correctly stated on page 11 of their brief, “therefore as a condition precedent to any action challenging a foreclosure, a plaintiff must pay or offer to pay the secured debt before an action is commenced or in the complaint.” (Emphasis added).  This is not an action challenging a foreclosure, but even if those standards were inappropriately applied to this action, the tender or offer to pay can be made “in the complaint.” The Verified First Amended Complaint (“VFAC”) states, “Plaintiff offers to pay and mortgage payments on the property to the individual or entity that is the valid holder of the original note as required by California Commercial Code § 3301, et seq. and all property taxes to the appropriate government agency.” (VFAC page 3, line 28 through page 4, line 7). This is a very clear tender, made “in the complaint,” even though it is not required in a Quiet Title Action.

Since tender is not a statutory element of a Quiet Title action, the Defendants’/Respondents’ arguments regarding the difficult financial times mentioned in the Plaintiffs’/Appellants’ ex-parte application for a preliminary injunction are moot. However, it should be noted that by the time the Plaintiffs/Appellants filed their ex-parte application, they had the additional financial burden of paying for attorney’s fees to have the same attorney who now represents them on appeal prepare pleadings for them and make special, limited scope appearances for them on the trial court level, so the conclusion that the Defendants/Respondents are asking the court to make are inaccurate.

Even the Defendants’/Respondents’ arguments regarding “implicit integration” of foreclosure issues are irrelevant, because the cases that they cited specifically involved a non-judicial foreclosure in which the sale had been completed, but no non-judicial foreclosure sale has taken place regarding the subject property. The defendants’ argument that Plaintiffs’/Appellants’ have failed to cite any authority for the fact that no allegation of tender is required is another false statement. Plaintiffs have directly quoted Code of Civil Procedure § 761.020, which fully sets forth the elements of a Quiet Title Action, and there is no requirement of tender. However, even if the court somehow found that a tender allegation was required, the tender allegation has been made in the Complaint in accordance with the Defedants’/Appellants’ own citations as set forth above. Further, the Defendants’/Respondents’ arguments that “a court of equity will not order a useless act performed” (FPCI Re-Hab 01, etc. v. E&G Investments, Ltd. (1989) 207 Cal.App.3d 1018, 1022, and “equity will not interpose its remedial power in the accomplishment of what seemingly would be nothing but an idly and expensively futile act” (Leonard v. Bank of America Ass’n (1936) 16 Cal. App. 2d 341, 344) could and should just as easily be applied to the futile and useless acts that Defendants’/Respondents’ are requesting to be required and plead when they do not possess the original note and therefore have no right to expect payments, seek payments, nor threaten foreclosure because they did not receive payments that they had no right to receive in the first place, pursuant to Commercial Code § 3301. It can and should also be used to destroy their argument that plaintiff must be subjected to the requirements of case law regarding actions seeking to undo foreclosure irregularities before the foreclosure has even been completed, as though plaintiff should be able to foresee every foreclosure irregularity with a crystal ball before the process is even completed!

C.        SUSTAINING OF THE DEMURRER WAS REVERSIBLE ERROR BECAUSE CALIFORNIA LAW REQUIRES WELLS FARGO TO POSSESS THE NOTE IN ORDER TO ENFORCE THE LOAN.

Plaintiffs/Appellants have cited a fully binding California Statute, Commercial Code § 3301, which specifically states that in order to be a “person entitled to enforce an instrument,” the Defendants/Respondents must have been the holder of the instrument, with very limited exceptions. In opposition, the Defendants/Respondents continue their same bad habit engaged in during the trial court proceedings of citing and relying upon federal trial court cases, which are not binding authority in any way, without disclosing to the court that they are citing non-binding authority. In addition, many of their citations do not even contain the full reference, so that it is difficult or impossible to locate and read the case. As for the federal trial court cases, all that they have demonstrated is that there is a need for a California appellate court to clear up the confusion that clearly exists regarding California’s law, and especially Commercial Code § 3301. Further, their statement that every court that has considered the issue has ruled that possessing the note is not necessary for a foreclosure is false. For example, in the U.S. Bankruptcy Court for the Northern District of California in San Jose, a federal trial court judge stopped a foreclosure because the bank could not produce the note in the case of Caporale v. Saxon Mortgage, Case No. 07-54109. Like the Defendants’/Respondents’ authorities, this case is only persuasive authority, not binding, but it was reported on by ABC News, and a copy of the news video is available to be viewed online at http://abclocal.go.com/kgo/story?section=news/7_on_your_side&id=6839404. If the court is going to consider the non-binding federal trial court decisions offered by the Defendants/Respondents, the court should also consider the non-binding persuasive authority of In re Foreclosure Cases, 2007 WL 3232430 (Bankr. N.D. Ohio 2007), wherein U.S. Bankruptcy Court Judge Christopher Boyko dismissed without prejudice fourteen judicial foreclosure actions filed by the trustees of securitized trusts against borrowers who had defaulted on their residential mortgages that had been sold into securitized trusts, based upon the application of Uniform Commercial Code § 3-301 to the mortgages in question.

As for their claim that the commercial code does not apply to a mortgage or a note secured by deed of trust, the Defendants/Respondents are willfully ignoring Staff Mortgage v. Wilke (1980) 625 F.2d 281, 6 Bankr.Ct.Dec. 1385, 29 UCC Rep.Serv. 639, cited in Plaintiffs’/Appellants’ Opening Brief, which clearly states that “notes secured by deeds of trust…were ‘instruments’ under the California Commercial Code.” This holding is repeated in Starr v. Bruce Farley Corp. (9th Cir. 1980), 612 F.2d 1197. The Defendants/Respondents have offered nothing other than their own opinion for the proposition that the note secured by deed of trust in question is not a “negotiable instrument” within the meaning of Commercial Code § 3301, even though they claim to have purchased the note, which by definition makes it negotiable.

D.        THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS REGARDING THE PROPRIETY OF SUSTAINING THE DEMURRER ON THE CLAIMS TO QUIET TITLE AND REMOVE CLOUD ARE BASED UPON THE DELIBERATE MISREPRESENTATION OF THE NATURE OF THE DEMUCHAS’ COMPLAINT.

As always, the Defendants/Respondents insist upon misrepresenting the nature of the First Amended Complaint. Every element of each of these causes of action was specifically plead, as has been demonstrated. Pursuant to Commercial Code § 3301, the Defendants/Respondents have no right to enforce the note unless they possess the note. Plaintiffs/Appellants rely upon the appellate court to read the First Amended Complaint and comprehend it independently of the Defendants’/Respondents’ misrepresentations.

E.        THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS REGARDING THE PROPRIETY OF SUSTAINING THE DEMURRER ON THE CLAIM FOR FRAUD AND MISREPRESENTATION ARE BASED UPON THE DELIBERATE MISREPRESENTATION OF THE CONTENT OF THE DEMUCHAS’ COMPLAINT.

The content of the First Amended Complaint speaks for itself. The Defendants/Respondents continue to look right at the paragraphs of the document that contain the elements required by law for each cause of action and to falsely state that the required allegations are not there. Plaintiffs/Appellants rely upon the appellate court to read the First Amended Complaint and comprehend it independently of the Defendants’/Respondents’ misrepresentations.

F.         THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS REGARDING THE PROPRIETY OF SUSTAINING THE DEMURRER ON THE CLAIM FOR INFLICTION OF EMOTIONAL DISTRESS ARE BASED UPON THE DELIBERATE MISREPRESENTATION OF THE CONTENT OF THE DEMUCHAS’ COMPLAINT.

The content of the First Amended Complaint speaks for itself. The Defendants/Respondents continue to look right at the paragraphs of the document that contain the elements required by law for each cause of action and to falsely state that the required allegations are not there. Plaintiffs/Appellants rely upon the appellate court to read the First Amended Complaint and comprehend it independently of the Defendants’/Respondents’ misrepresentations.

G.        THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS REGARDING THE PROPRIETY OF SUSTAINING THE DEMURRER ON THE CLAIM FOR SLANDER OF CREDIT ARE BASED UPON THE DELIBERATE MISREPRESENTATION OF THE CONTENT OF THE DEMUCHAS’ COMPLAINT.

The content of the First Amended Complaint speaks for itself. The Defendants/Respondents continue to look right at the paragraphs of the document that contain the elements required by law for each cause of action and to falsely state that the required allegations are not there. Plaintiffs/Appellants rely upon the appellate court to read the First Amended Complaint and comprehend it independently of the Defendants’/Respondents’ misrepresentations.

H.        THE DEFENDANTS’/RESPONDENTS’ ARGUMENTS REGARDING THE PROPRIETY OF SUSTAINING THE DEMURRER ON THE CLAIM FOR INFLICTION OF EMOTIONAL DISTRESS ARE BASED UPON THE DELIBERATE MISREPRESENTATION OF THE CONTENT OF THE DEMUCHAS’ COMPLAINT.

The content of the First Amended Complaint speaks for itself. The Defendants/Respondents continue to look right at the paragraphs of the document that contain the elements required by law for each cause of action and to falsely state that the required allegations are not there. Plaintiffs/Appellants rely upon the appellate court to read the First Amended Complaint and comprehend it independently of the Defendants’/Respondents’ misrepresentations.

CONCLUSION

            The trial court erred in sustaining the demurrer without leave to amend and entering a judgment of dismissal. The rules of a non-judicial foreclosure proceeding and litigation to set aside a non-judicial foreclosure do not apply to a quiet title action that is filed prior to a foreclosure sale. The Commercial Code’s requirements that the entity enforcing a note must possess the original note (with limited exceptions) applies to a Note Secured by Deed of Trust. Even in the context of a non-judicial foreclosure, there is no “breach” unless the entity that did not receive the mortgage payments had a right to receive the mortgage payments through possession of the original note or compliance with another recognized exception under the Commercial Code. Any other result would cause an unnecessary conflict of laws and allow fraudulent “lenders” to engage in non-judicial foreclosures and sales of property so long as they complied with the technical requirements of a non-judicial foreclosure. All of the causes of action of the Verified First Amended Complaint are properly plead, with the exception that “punitive damages” is not technically a cause of action, but that can be resolved by striking the label “Sixth Cause of Action” and just allowing the heading “Punitive Damages” to stand.

RESPECTFULLY SUBMITTED,

            Dated: 23 December 2010                                                                                                                  

Michael D. Finley, Esq.

Counsel for Plaintiffs/Appellants

Mark J. DeMucha & Cheryl M. DeMucha

CERTIFICATE OF COMPLIANCE

Pursuant to rule 8.204(c) of the California Rules of Court, I hereby certify that this brief contains 3,914 words, including footnotes. In making this certification, I have relied on the word count of the computer program used to prepare the brief.

Dated: 23 December 2010                                                                                                                  

Michael D. Finley, Esq.

Counsel for Plaintiffs/Appellants

Mark J. DeMucha & Cheryl M. DeMucha

 PROOF OF SERVICE

STATE OF CALIFORNIA, COUNTY OF LOS ANGELES

I am employed in the County of Los Angeles, State of California. I am over the age of 18 and not a party to the within action; my business address is: 25375 Orchard Village Road, Suite 106, Valencia, CA 91355-3000.

On 23 December 2010 I served the foregoing document described as: Appellant’s Opening Brief on the interested parties in this action by placing a true copy thereof in sealed envelopes addressed as follows:

(Attorneys for Wells Fargo Home Mortgage, Inc. & Wells Fargo Bank, N.A.): Kutak Rock LLP, 18201 Von Karman, Suite 1100, Irvine, CA 92612

(Attorneys for First American Loanstar Trustee Services & First American Corporation): Wright, Finlay & Zak, LLP, 4665 MacArthur Court, Suite 280, Newport Beach, CA 92660

Judge Sidney P. Chapin, Kern County Superior Court, Metropolitan Division, 1415 Truxtun Ave., Bakersfield, CA 93301

BY MAIL: I deposited such envelopes in the mail at Valencia, California. The envelopes were mailed with first class postage thereon fully prepaid.

ALSO, BY ELECTRONIC FILING WITH THE SUPREME COURT: In addition, I filed an electronic copy of the Appellant’s Opening Brief with the Supreme Court of California on 23 December 2010, through the Supreme Court’s website.

Dated: 23 December 2010                                                                                                                  

Michael D. Finley, Esq.

Counsel for Plaintiffs/Appellants

Mark J. DeMucha & Cheryl M. DeMucha

MARK J. DEMUCHA AND CHERYL M. DEMUCHA, a brief that worked

14 Dec

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIFTH APPELLATE DISTRICT

MARK J. DEMUCHA AND CHERYL M. DEMUCHA,

Plaintiffs,

vs.

WELLS FARGO HOME MORTGAGE, INC.; WELLS FARGO BANK, NATIONAL ASSOCIATION a.k.a. WELLS FARGO BANK, N.A.; FIRST AMERICAN LOANSTAR TRUSTEE SERVICES; FIRST AMERICAN CORPORATION; AND DOES 1 TO 45,

                                                              Defendants

Court of Appeal

No. F059476

(Superior Court No.: S-1500-CV-267074)

 

 

 

Appeal From a Judgment of Dismissal following the Sustaining of Demurrer Without Leave to Amend

The Superior Court of California, County of Kern

The Honorable SIDNEY P. CHAPIN, Judge

APPELLANTS’ OPENING BRIEF

 

 

Mark J. DeMucha & Cheryl M. DeMucha

Represented by Michael D. Finley, Esq.

25375 Orchard Village Road, Suite 106

Valencia, CA 91355-3000

661.964.0444

 

TABLE OF CONTENTS

TABLE OF AUTHORITIES                                                                                                        ii

STATEMENT OF THE CASE                                                                                                     1

STATEMENT OF APPEALABILITY                                                                                        1

STATEMENT OF THE FACTS                                                                                                  1

ARGUMENT                                                                                                                                5

I.     THE COURT ABUSED ITS DISCRETION
IN DISMISSING THE VERIFIED FIRST AMENDED
COMPLAINT WITHOUT LEAVE TO AMEND                                                    5

A.   The Standard of Review                                                                                   5

B.   Causes of Action to Be Discussed Independently                                       5

II.    A PARTY SEEKING TO ENFORCE A NOTE SECURED
BY DEED OF TRUST IN CALIFORNIA MUST POSSESS
THE ORIGINAL NOTE OR OTHERWISE COMPLY WITH
THE CALIFORNIA COMMERCIAL CODE                                                          6

A.   Commercial Code § 3301, et seq., applies to Notes
Secured by Deed of Trust                                                                                6

B.   California Law requires security interests in real property
to be perfected by obtaining possession of the original note                    7

C.   The foreclosure statute cannot be read in a vacuum and must
be read in a manner that complies with other applicable statutes             7

III.  THE ELEMENTS OF A QUIET TITLE ACTION HAVE BEEN
PROPERLY PLEAD                                                                                                  8

A.   Elements of the Action                                                                                     8

B.   The elements of quiet title were fully plead                                                 9

IV.  TENDER IS NOT AN ELEMENT OF QUIET TITLE,
BUT WAS PLEAD ANYWAY                                                                                9

A.   Defendant’s arguments that tender must be alleged are false                    9

B.   Tender was properly alleged                                                                          10

C.   The court erred by considering extrinsic evidence regarding tender      10

V.   THE ELEMENTS OF AN ACTION TO REMOVE CLOUD
WERE PROPERLY PLEAD                                                                                    11

A.   Elements of the Action                                                                                   11

B.   The elements of an Action to Remove Cloud were properly plead         11

VI.  THE ELEMENTS OF FRAUD WERE PROPERLY PLEAD                               11

A.   Elements of the Action                                                                                   11

B.   The elements of Fraud were fully plead                                                       12

C.   The defendant again improperly offered irrelevant extrinsic
evidence to support its arguments on this issue                                         12

VII. THE ELEMENTS OF INTENTIONAL INFLICTION OF
EMOTIONAL DISTRESS WERE PROPERLY PLEAD                                       12

A.   Elements of the Action                                                                                   12

B.   The elements of intentional infliction of emotional distress
were properly plead                                                                                        13

C.   Defendant’s assertion of a privilege constitutes a defense, not
an element, and does not overcome the allegation of intentionally fraudulent statements and conduct based thereon                                                                            13

D.   The defendant again asserted and the trial court may have
considered improper and irrelevant extrinsic evidence                            13

VIII.  THE ELEMENTS OF SLANDER OF CREDIT WERE
PROPERLY PLEAD                                                                                                 14

A.   Elements of the Action                                                                                   14

B.   The elements of slander of credit were properly plead                             14

C.   The defendant again asserted and the trial court may have
considered improper and irrelevant extrinsic evidence                            14

IX.  THE PARAGRAPHS REGARDING PUNITIVE
DAMAGES, THOUGH MISLABLED AS A “CAUSE
OF ACTION,” WERE PROPERLY PLEAD                                                          15

A.   Elements of Punitive Damages                                                                      15

B.   The elements of punitive damages, though properly plead,
were mislabeled as a “cause of action,” which should be
disregarded as a trifle, with substance being honored over form            15

X.   IF THE DEMURRER IS OVERTURNED, THE MOTION
TO STRIKE WILL NO LONGER BE MOOT, SO THAT
THE TRIAL COURT SHOULD RECEIVE INSTRUCTIONS
REGARDING THE LAW ON THOSE ISSUES                                                    15

A.   The Trial Court ruled that the Motion to Strike was Moot
due to the sustaining of the Demurrer                                                          16

B.   If the sustaining of the Demurrer and the order of dismissal
are overturned, the Motion to Strike will no longer be moot
and the court may need to instruct the trial court:                                     16

CONCLUSION                                                                                                                            16

TABLE OF AUTHORITIES

CASES

                                                                                                                                                     Page

Abdallah v. United Sav. Bank (1995) 43 Cal.App.4th 1001.                                                9

Blank v. Kirwan (1985) 39 Cal.3d 311, 318.                                                                           5

Cervantez v. J. C. Penney Co. (1979) 24 Cal. 3d 579, 593).                                             12, 13

Ephraim v. Metropolitan Trust Co. of Ca. (1946) 28 Cal.2nd 824, 835.                            11

Gonsalves v. Hodgson (1951) 38 Cal.2d 91, 100-101.                                                         11

I.E. Assocs. v. Safeco Title Ins. Co. (1985) 39 Cal.3d 281                                                    7

Knickerbocker v. City of Stockton (1988) 199 Cal.App.3d 235, 239, fn. 2.                   5, 10

Nguyen v. Calhoun (2003) 105 Cal.App.4th 428                                                                   9

Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 38, 39.                      5

Roberts v. Ball, Hunt, Hart, Brown & Baerwitz (1976) 57 Cal.App.3d 104, 109.            11

Santa Teresa Citizen Action Group v. State Energy Resources
Conservation & Development Com. (2003) 105 Cal.App.4th 1441, 1445.                        5

Staff Mortgage v. Wilke (1980) 625 F.2d 281                                                                               7

Wilner v. Sunset Life Ins. Co. (2000) 78 Cal.App.4th 952, 958.                                          5

Zelig v. County of Los Angeles (2002) 27 Cal.4th 1112, 1126.                                           5

STATUTES

Business & Professions Code § 10233.2                                                                                        7

Civil Code § 2923.5                                                                                                                    2

Civil Code § 2924(a)                                                                                                                   8

Civil Code § 3294                                                                                                                      15

Civil Code § 3528                                                                                                                      15

Civil Code § 3535                                                                                                                      15

Code of Civil Procedure § 425.12                                                                                           15

Code of Civil Procedure § 761.020                                                                                          8

Code of Civil Procedure § 2015.5                                                                                             2

Commercial Code § 3301, et seq.                                                                                      2, 6, 8, 10

Commercial Code § 3309                                                                                                           6

Commercial Code § 3418(d)                                                                                                      6

Commercial Code § 9304(l)                                                                                                           7

 

 

STATEMENT OF THE CASE

            Plaintiffs and appellants MARK J. DEMUCHA and CHERYL M. DEMUCHA filed a Verified First Amended Complaint on 15 June 2009 seeking Quiet Title, Removal of Cloud on Title, Damages for Fraud and Misrepresentation, Damages for Intentional Infliction of Emotional Distress, Damages for Slander of Credit, and Punitive Damages (Verified First Amended Complaint in Augmented Record, hereafter “VFAC”). Plaintiffs obtained a preliminary injunction against foreclosure on 7/7/2009 (Court Register of Actions or Docket in Augmented Record, hereafter “CRAD”). However, plaintiffs did not post the required bond of $10,807.40, so the order was dissolved on 7/29/2009 (CRAD). On 15 July 2009, Defendants filed a Demurrer (CT 1) and Motion to Strike Portions of the First Amended Complaint (CT 17). Plaintiff filed his oppositions to the Demurrer and Motion to Strike on 28 August 2009 (CT 26 & Plaintiff’s Brief in Opposition to Defendant’s Motion to Strike Portions of First Amended Complaint; Memorandum of Points of Authorities in Support Thereof in Augmented Record- hereafter “OMS”). Defendants filed their reply briefs on the Demurrer and Motion to Strike on 17 September 2009 (CT 35 and 41). Hearings were held on the Demurrer and Motion to Strike on 14 and 28 September 2009 (RT 2-5). The Court sustained the Demurrer without leave to amend and ruled the Motion to Strike as moot on 28 September 2009 (RT 4, line 22 through 5, line 19). The Court’s Judgment and Order of Dismissal was entered on 7 October 2009 (CT 57).

STATEMENT OF APPEALABILITY

            This appeal is from the judgment of the Kern County Superior Court and is authorized by the Code of Civil Procedure, section 904.1, subsection (a)(1).

STATEMENT OF THE FACTS

            Plaintiffs and appellants MARK J. DEMUCHA and CHERYL M. DEMUCHA filed a Verified First Amended Complaint on 15 June 2009 seeking Quiet Title, Removal of Cloud on Title, Damages for Fraud and Misrepresentation, Damages for Intentional Infliction of Emotional Distress, Damages for Slander of Credit, and Punitive Damages (Verified First Amended Complaint in Augmented Record, hereafter “VFAC”). A key allegation throughout the VFAC was that the defendants “have all failed and refused to produce the original note or otherwise provide proof that any of the defendants is or at any time was the holder of the original note that the defendants, and each of them, are trying to enforce, as required by California Commercial Code § 3301, et seq.” (VFAC 2, line 26 through 3, line 4). It is important to note that this was not an action to stop a foreclosure, but primarily a quiet title action. Plaintiffs did seek a preliminary injunction against foreclosure and obtained the injunction on 7/7/2009 (the court ruled that the defendants failed to comply with Civil Code § 2923.5 and Code of Civil Procedure § 2015.5, requiring that the Notice of Default Declaration be a declaration signed under penalty of perjury, so that the defendants’ entire foreclosure proceedings were invalid) (Court Register of Actions or Docket in Augmented Record, hereafter “CRAD”). However, plaintiffs did not post the required bond of $10,807.40, so the order was dissolved on 7/29/2009. On 15 July 2009, Defendants filed a Demurrer (CT 1) and Motion to Strike Portions of the First Amended Complaint (CT 17). Plaintiff filed his oppositions to the Demurrer and Motion to Strike on 28 August 2009 (CT 26 & Plaintiff’s Brief in Opposition to Defendant’s Motion to Strike Portions of First Amended Complaint; Memorandum of Points of Authorities in Support Thereof hereafter “OMS”). Defendants filed their reply briefs on the Demurrer and Motion to Strike on 17 September 2009 (CT 35 and 41). Throughout their pleadings, the defendants repeatedly mischaracterized the proceedings as being anti-foreclosure proceedings and argued that a lender need not “possess the note” prior to conducting a non-judicial foreclosure (CT 2, lines 9-12), and claimed falsely that there was no allegation of tender in the First Amended Complaint (CT 2, lines 4-8) over the plaintiffs’ objections (CT 26, line 25 through 27, line 4). The defendants further falsely claimed that the first cause of action for quiet title must fail because “plaintiffs cannot state a basis for superior title,” failed to allege all adverse claims, and failed to allege a legal description (CT 2, lines 13-17). In fact, all of the allegedly non-existent allegations are found in paragraphs 9 through 14 of the VFAC (CT 27, lines 5 through 8; VFAC 2, line 17 through 4, line 3). With respect to the second cause of action for “Action to Remove Cloud,” the defendants falsely claimed that it should fail because plaintiffs failed to state a cause of action, failed to plead facts indicating that an instrument was invalid, failed to satisfy the legal requirements for a quiet title action, and cannot demonstrate equity (CT 2, lines 18-22). Again, all of the allegedly missing allegations are contained in paragraphs 9 through 13 of the VFAC (CT 27, lines 9-15; VFAC 2, line 17 through 3, line 24). Regarding the third cause of action for fraud and misrepresentation, defendants falsely claimed that plaintiffs failed to state a cause of action because plaintiffs failed to allege specific facts indicating that any representation was false, cannot allege specific facts indicating that any representation was made with knowledge of its falsity, and plaintiffs could not have actually relied on any alleged representation (CT 2, lines 23-28). In fact, all of the allegedly missing allegations are found in paragraphs 10, 13, 16, and 18 of the VFAC (CT 27, lines 16-25; VFAC page 2 line 26 though page 3 line 10, page 3 lines 20 through 26, page 4 lines 12 through 16, and page 4 line 23 through page 6 line 6). With respect to the fourth cause of action for intentional infliction of emotional distress, defendants falsely claimed that the cause of action must fail because plaintiffs do not contend that they tendered all of their payments under the loan, alleged no facts indicating outrageous conduct, and alleged no facts indicating that defendant intentionally caused any plaintiff emotional distress (CRT 11, line 8 through 12, line 26). In fact, all of the supposedly missing allegations were contained in paragraph 21 (and through incorporation by reference, paragraphs 10, 12, 13, 14, 16, and 18) of the Verified First Amended Complaint (CT 27, line 26 through 28, line 3; VFAC 6 lines 19 through 23; VFAC 2, line 26 through 3, line 10; VFAC 3, line 15 through 4, line 3; VFAC 4, lines 8-14 and 19-24). The demurrer falsely asserted that the fifth cause of action for Slander of Credit must fail because plaintiffs failed to identify the allegedly defamatory statement, cannot allege that any statement about plaintiffs’ credit was false, and cannot allege actual malice (CT 13, line 1 through 14, line 22). In fact, all of the purportedly missing allegations were contained in paragraph 23 (and through incorporation by reference, paragraphs 10, 12, 13, 14, 16, and 18) of the Verified First Amended Complaint (CT 28, lines 4-15; VFAC 7 lines 1 through 3; VFAC 2, line 26 through 3, line 10; VFAC 3, line 15 through 4, line 3; VFAC 4, lines 8-14 and 19-24). The demurrer asserted that the sixth cause of action for Punitive Damages must fail because punitive damages are not a cause of action and a false assertion that plaintiffs failed to plead facts supporting any entitlement to punitive damages (CT 14, line 23 through 15, line 12). Plaintiffs argued that the use of the label “cause of action” did not remove the requirement that the punitive damages allegations be plead, that if it were labeled differently the defendants would have no argument, that the court is to honor substance over form and trifles are to be disregarded, that all of the necessary elements for punitive damages are contained in the sixth cause of action of the Verified First Amended Complaint, and that plaintiff should be given leave to amend (CT 28, line 16 through 29, line 2; VFAC 5, line 19 through 6, line 5). The defendants’ Motion to Strike sought to eliminate the allegations regarding attorney’s fees without any authorities based upon a false claim that the plaintiffs failed to allege a contractual or statutory provision entitling them to such recovery, and the allegations regarding punitive damages based on essentially the same reasoning stated in the Demurrer to the sixth cause of action. CT 18, line 5 through 19, line 4). The plaintiffs fully opposed the Motion to Strike in their “Plaintiff’s Brief in Opposition to Defendant’s Motion to Strike Portions of First Amended Complaint; Memorandum of Points of Authorities in Support Thereof.” Hearings were held on the Demurrer and Motion to Strike on 14 and 28 September 2009 (RT 2-5). The Court sustained the Demurrer without leave to amend and ruled the Motion to Strike as moot, specifically finding that “there’s no tender on the amounts of the loan, and failure to produce the note is not in the foreclosure proceeding as to the deed of trust, a basis upon which to attack the foreclosure” (RT 4, line 22 through 5, line 19). There were numerous other arguments made about the other allegations of the complaint, including a ridiculous assertion by the defendants that the Commercial Code applies only to consumer goods and not to mortgages of real property (CT 6, lines 22-23), but the court apparently hung its hat on these findings alone: the blatantly false claim that no tender was alleged and that failure to produce the note is (according to the defendant and the honorable superior court) not a basis on which to attack a foreclosure (RT 4, line 22 through 5, line 19). The Court’s Judgment and Order of Dismissal was entered on 7 October 2009 (CT 57).

ARGUMENT

Issue 1

THE COURT ABUSED ITS DISCRETION IN DISMISSING THE VERIFIED FIRST AMENDED COMPLAINT WITHOUT LEAVE TO AMEND

            A.        The Standard of Review: “On review of an order sustaining a demurrer without leave to amend, our standard of review is de novo, ‘i.e., we exercise our independent judgment about whether the complaint states a cause of action as a matter of law.’ [Citation.]” (Santa Teresa Citizen Action Group v. State Energy Resources Conservation & Development Com. (2003) 105 Cal.App.4th 1441, 1445.) “We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law. [Citation.] We also consider matters which may be judicially noticed.” [Citation.] Further, we give the complaint a reasonable interpretation, reading it as a whole and its parts in their context.’” (Zelig v. County of Los Angeles (2002) 27 Cal.4th 1112, 1126). When analyzing a demurrer, the court is to look “only to the face of the pleadings and to matters judicially noticeable and not to the evidence or other extrinsic matter.” (Knickerbocker v. City of Stockton (1988) 199 Cal.App.3d 235, 239, fn. 2.). The appellate court is “not bound by the trial court’s construction of the complaint . . . .” (Wilner v. Sunset Life Ins. Co. (2000) 78 Cal.App.4th 952, 958.) Rather, the appellate court is to independently evaluate the complaint, construing it liberally, giving it a reasonable interpretation, reading it as a whole, and viewing its parts in context. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) The appellate court must determine de novo whether the factual allegations of the complaint are adequate to state a cause of action under any legal theory. (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 38.) In the event that the complaint is found to not state a cause of action, but there is a reasonable possibility that amendment can cure the defect, leave to amend must be granted. (Id. at p. 39.)

B.        Causes of action to be discussed independently: Plaintiffs/appellants will discuss each cause of action independently below, demonstrating that each element of each cause of action has been fully plead. Further, plaintiffs/appellants contend that if the court determines that any element was lacking, an amendment could provide the necessary allegation(s), so that leave to amend should be granted.

Issue 2

A PARTY SEEKING TO ENFORCE A NOTE SECURED BY DEED OF TRUST IN CALIFORNIA MUST POSSESS THE ORIGINAL NOTE OR OTHERWISE COMPLY WITH THE CALIFORNIA COMMERCIAL CODE

            A.        Commercial Code § 3301, et seq., applies to Notes Secured by Deed of Trust: With respect to “negotiable instruments,” California’s Commercial Code § 3301 specifies as follows:

“Person entitled to enforce” an instrument means (a) the holder of the instrument, (b) a nonholder in possession of the instrument who has the rights of a holder, or (c) a person not in possession of the instrument who is entitled to enforce the instrument pursuant to Section 3309 or subdivision (d) of Section 3418. A person may be a person entitled to enforce the instrument even though the person is not the owner of the instrument or is in wrongful possession of the instrument.

According to this code section, which applies to “negotiable instruments,” the instrument may only be enforced by someone who possesses the original instrument, unless they meet the exceptions that are set forth in Commercial Code § 3309 or 3418(d). In the case before this court, the defendants do not possess the original Note Secured by Deed of Trust, although they claim to “own” the note, which they allegedly purchased from the original lender. The fact that they claim to have purchased the “Note Secured by Deed of Trust” demonstrates that it was a “negotiable instrument. However, the defendants falsely argued to the trial court that “the Uniform Commercial Code applies to the sale of goods and not transactions involving real property” (CT 6, lines 22-23).

B.        California Law requires security interests in real property to be perfected by obtaining possession of the original note: The United States Court of Appeals for the 9th Circuit, specifically ruling on a California federal case, in Staff Mortgage v. Wilke (1980) 625 F.2d 281, 6 Bankr.Ct.Dec. 1385, 29 UCC Rep.Serv. 639, citing an earlier case, specifically held that “notes secured by deeds of trust…were ‘instruments’ under the California Commercial Code,” that recording was not adequate to perfect the security interest under the Commercial Code because “such notice was not the type of notice intended or provided by the California Commercial Code,” and that “Perfection of a security interest in an instrument can only occur with the actual possession of the instrument by the secured party.” This case specifically cited Commercial Code § 9304(l). In defendant’s reply brief, they falsely claimed that this case “is no longer good authority because it was superseded by statute” (CT 43, line 28 to CT 44, line 6). However, the defendant blatantly misrepresented the law, because the statute that supposedly superseded this case, California Business & Professions Code § 10233.2, merely created an exception to this rule that permits perfection without possession of the security instrument only in the case of real estate brokers who sell a note and then service the note, in which case the security interest has been perfected even if the broker continues to possess the note. This is not the situation in the case before this court. Here, defendant Wells Fargo, a bank, not a real estate broker, purchased the Note Secured by Deed of Trust from a different lender. The exception that they falsely claim has “superseded” Staff Mortgage does not apply by any stretch of the imagination.

C.        The foreclosure statutes cannot be read in a vacuum and must be read in a manner that complies with other applicable statutes: The defendants cited I.E. Assocs. v. Safeco Title Ins. Co. (1985) 39 Cal.3d 281 in their demurrer (CT 6, line 28 through CT 7 line 4) for the proposition that the non-judicial foreclosure statutes are intended to be exhaustive, so no other laws apply. However, this is a complete misstatement of that case. The actual ruling in I.E. Assocs. was that the principles of common law do not apply because the non-judicial foreclosure statutes are intended to be exhaustive. There is no ruling in I.E. Assocs., nor any other binding authority, that would cause the non-judicial foreclosure statutes to supersede other applicable statutes. There is further nothing in the non-judicial foreclosure statutes that negates the requirements of the Commercial Code that a negotiable instrument must be possessed by the person or entity that seeks to enforce it. The non-judicial foreclosure statutes do require that there must be a “breach” prior to the commencement of foreclosure proceedings (Civil Code § 2924(a)). When read together, Commercial Code § 3301 helps to determine whether or not there has been a “breach” of the Note Secured by Deed of Trust that would trigger the lender’s right to pursue a non-judicial foreclosure. If the lender has perfected its security interest by possessing the original Note or falling within one of the two statutory exceptions, then they have the right to receive the mortgage payments, and if the borrower then fails to make the payments to the entity that has the right to enforce the note, there has been a “breach.” On the other hand, if the entity seeking to enforce the note is not authorized to enforce the note due to lack of compliance with Commercial Code § 3301, that entity cannot properly claim that there has been a “breach” that triggers the right to engage in the non-judicial foreclosure process. If the court were to reach any other result, it would create a conflict of laws and would put borrowers in danger of foreclosure by fraudulent entities who claim to have the right to engage in non-judicial foreclosure proceedings even though they do not have the right to enforce the note, and who subsequently hide behind technical compliance with the non-judicial foreclosure procedures. The borrower could be making or tendering the payment to the entity who holds the statutory right to enforce the note and still be subjected to a non-judicial foreclosure proceeding by a fraudulent “lender” who falsely claims to have the right to enforce the note while not complying with Commercial Code § 3301.

Issue 3

THE ELEMENTS OF A QUIET TITLE ACTION HAVE BEEN PROPERLY PLEAD

            A.        Elements of the Action: Pursuant to Code of Civil Procedure § 761.020, the elements of a Quiet Title Action are as follows:

   (a) A description of the property that is the subject of the action. In the case of tangible personal property, the description shall include its usual location. In the case of real property, the description shall include both its legal description and its street address or common designation, if any.
   (b) The title of the plaintiff as to which a determination under this chapter is sought and the basis of the title. If the title is based upon adverse possession, the complaint shall allege the specific facts constituting the adverse possession.
   (c) The adverse claims to the title of the plaintiff against which a determination is sought.
   (d) The date as of which the determination is sought. If the determination is sought as of a date other than the date the complaint is filed, the complaint shall include a statement of the reasons why a determination as of that date is sought.
   (e) A prayer for the determination of the title of the plaintiff against the adverse claims.

B.        The Elements of Quiet Title were fully plead: Plaintiff’s superior title is alleged in Paragraph 9 (page 2 lines 17 through 25) and 14 (page 3 line 27 through page 4 line 1), all adverse claims against the property are specified in Paragraphs 9 through 14 (page 2 line 17 through page 3 line 28), the legal description and property address are specified in Paragraph 9 (page 2 lines 18 through 23), the date as of which the determination is sought is specified in Paragraph 14 (page 3 lines 27-28), and the prayer for title in plaintiff’s favor is found on page 6 line 8 of the VFAC.

Issue 4

TENDER IS NOT AN ELEMENT OF QUIET TITLE, BUT WAS PLEAD ANYWAY

            A.        Defendant’s arguments that tender must be alleged are false: In the defendant’s Demurrer, it was argued that actions attacking trustee sales by foreclosure require tender of the amount due for a secured debt. Defendants cited several cases, including, but not limited to, Nguyen v. Calhoun (2003) 105 Cal.App.4th 428 and Abdallah v. United Sav. Bank (1995) 43 Cal.App.4th 1001. However, all of those cases were attacks on a trustee sale after the sale was completed. In the case before this court, no foreclosure has been completed and no trustee sale has been held. Therefore, no allegation of tender is necessary.

B.        Tender was properly alleged: Even though plaintiffs/appellants contend that tender was not required to be alleged, the VFAC contains the allegations of tender in Paragraph 14 (page 4 lines 2 through 7- VFAC). Because plaintiffs/appellants further contend that the defendants do not possess the original note and are therefore not entitled to enforce the note secured by deed of trust pursuant to Commercial Code § 3301, et seq. (discussed more fully below), the plaintiffs/appellants made their tender “to the individual or entity that is the valid holder of the original note,” as well as to pay all taxes to the appropriate government agency.” (VFAC page 4, lines 2 through 7). Plaintiffs/appellants contend that this allegation of tender is appropriate where it is unclear as to who has proper authority under the law to receive the mortgage payments.

C.        The Court erred by considering extrinsic evidence regarding tender: The defendant argued that statements in a separate ex parte application for preliminary injunction indicated that the plaintiffs/appellants could not tender the amounts due for the mortgage because they were “experiencing ‘difficult financial times’ and do not earn enough to ‘make ends meet” (CT 5, lines 10-14). The trial court was apparently heavily influenced by this argument, because it decided that there was no tender (RT 4, line 22 through 5, line 19) despite the obvious allegations of tender contained in the complaint (VFAC page 4, lines 2 through 7). Pursuant to Knickerbocker v. City of Stockton (1988) 199 Cal.App.3d 235, 239, fn. 2, cited above under Issue I, the court should not have considered any extrinsic evidence, but should have only looked at the four corners of the pleadings, plus matters that are properly judicially noticed. Here, the argument is further very weak because there are no details about the exact nature of the plaintiffs/appellants’ financial predicament. The CRAD (in the augmented record) shows that plaintiffs/appellants had an attorney appear for them at one hearing, which is the same attorney acting for the plaintiffs/appellants on this appeal. Further, that same attorney prepared other documents for the defendants that were filed in propria persona, so that they had additional expenses besides just living expenses due to the defendants’ actionable conduct. The point is that it is not safe to assume that the plaintiffs/appellants could not have afforded to tender the amounts due on the mortgage to the proper possessor of the Note just because they were having financial difficulties during the litigation.

Issue 5

THE ELEMENTS OF AN ACTION TO REMOVE CLOUD WERE PROPERLY PLED

            A.        Elements of the Action: The elements of an Action to Remove Cloud are the same as those for an action to Quiet Title, with the distinction that the cloud on title is allegedly “created by a designated instrument. In a suit to remove a cloud the complaint must state facts, not mere conclusions, showing the apparent validity of the instrument designated, and point out the reason for asserting that it is actually invalid.” (Ephraim v. Metropolitan Trust Co. of Ca. (1946) 28 Cal.2nd 824, 835.)

B.        The elements of an Action to Remove Cloud were properly plead: The elements of a quiet title action were fully plead, as shown under Issue 3 above. The defendant further argued that there was no pleading of a specific invalid instrument. However, The allegations that the defendants’ claims through the mortgage (specific instrument) that was granted to CTX MORTGAGE COMPANY, LLC, are invalid may be found in Paragraphs 9 through 13 (page 2 line 17 through page 3 line 26) of the VFAC.

Issue 6

THE ELEMENTS OF FRAUD WERE PROPERLY PLEAD

            A.        Elements of the Action: The elements of an action for fraud are (1) a false representation about a material fact, (2) knowledge of the falsity, (3) intent to defraud, (4) justifiable reliance, and (4) damages. (Roberts v. Ball, Hunt, Hart, Brown & Baerwitz (1976) 57 Cal.App.3d 104, 109; Gonsalves v. Hodgson (1951) 38 Cal.2d 91, 100-101.)

B.        The Elements of Fraud were fully plead: The allegations of specific facts that representations were false are found in Paragraph 18 (page 4 line 23 through page 6 line 6), as well as in Paragraph 10 (page 2 line 26 though page 3 line 10), Paragraph 13 (page 3 lines 20 through 26), and Paragraph 16 (page 4 lines 12 through 16), of the VFAC. The allegations that the defendants knew of the falsity of the representations are found in Paragraph 18 (page 5 lines 1 through 3, page 5 lines 13 through 16, page 6 lines 2 through 6), as well as portions of Paragraphs 10, 13, and 16, of the VFAC. The allegations of ratification are found in Paragraph 18 (page 5 lines 12 through 13, and page 6 lines 1 and 2) of the VFAC. The allegations of reliance on the misrepresentations/ fraud and damages are contained in Paragraph 18 (page 5 lines 3 and 4, page 6 lines 6 through 9) of the VFAC.

C.        The defendant again improperly offered irrelevant extrinsic evidence to support its arguments on this issue: Defendant again argued in its Demurrer that the court should consider plaintiffs/appellants’ statement in their Ex Parte Application for a Preliminary Injunction that they are having “difficult financial times” to be proof that they were in default on their mortgage (CT 10, lines 10-12). This should not have been argued by the defendant nor considered by the court.

Issue 7

THE ELEMENTS OF INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS WERE PROPERLY PLEAD

            A.        Elements of the action: The elements of a cause of action for intentional infliction of emotional distress are: (1) the defendant engaged in extreme and outrageous conduct with the intention of causing, or reckless disregard of the probability of causing, severe emotional distress to the plaintiff; (2) the plaintiff actually suffered severe or extreme emotional distress; and (3) the outrageous conduct was the actual and proximate cause of the emotional distress. (Cervantez v. J. C. Penney Co. (1979) 24 Cal. 3d 579, 593).

B.        The elements of intentional infliction of emotional distress were properly plead: All of the necessary elements are plead in paragraphs 19 through 21 (pages 4 line 27 through 5 line 8) of the VFAC, with incorporation by reference of paragraphs 1 through 18. The defendant specifically argued that there was no pleading of outrageous conduct, but the outrageous conduct was plead using the phrase “intentional, unreasonable, and so outrageous that they exceed all bounds usually tolerated by a decent society” in Paragraph 21 (page 6 lines 19 through 23) and more fully described in the numerous prior paragraphs that are “incorporated by reference” into the Intentional Infliction of Emotional Distress cause of action (including, but not limited to, paragraphs 10, 12, 13, 14, 16, and 18) of the First Amended Complaint.

C.        Defendant’s assertion of a privilege constitutes a defense, not an element, and does not overcome the allegation of intentionally fraudulent statements and conduct based thereon: The defendant argued that it had a “qualified privilege” as a creditor (CT 11, line 19 through CT 12, line 9). However, this is merely a defense to the cause of action and therefore should not affect the complaint on demurrer (Cervantez v. J. C. Penney Co. (1979) 24 Cal. 3d 579, 593). Further, none of the authorities cited by the defendant allowed fraudulent statements and other misconduct based thereon to fall within the qualified privilege.

D.        The defendant again asserted and the trial court may have considered improper and irrelevant extrinsic evidence: Defendant yet again argued in its Demurrer that the court should consider plaintiffs/appellants’ statement in their Ex Parte Application for a Preliminary Injunction that they are having “difficult financial times” and were having trouble making ends meet to be proof that they were in default on their mortgage (CT 12, lines 12-15). Again, this should not have been argued by the defendant nor considered by the court.

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Issue 8

THE ELEMENTS OF SLANDER OF CREDIT WERE PROPERLY PLEAD

            A.        Elements of the Action: The elements that were contested by the defendant include purported failure to identify the allegedly defamatory statement, a claim that plaintiff cannot (not that they did not) allege that any statement about plaintiff’s credit was false, and that plaintiffs cannot (again, not that they did not) allege actual malice (CT 13, line 1 through CT 14, line 22).

B.        The elements of slander of credit were properly plead: The alleged defamatory statements are referenced in Paragraph 23 (page 7 lines 1 through 3), and more fully described in the paragraphs that are “incorporated by reference” into the Slander of Credit Cause of Action (including, but not limited to, paragraphs 10, 12, 13, 14, 16, and 18-including thorough verbatim quotes in paragraph 18) of the VFAC. The allegation that the statements about plaintiffs’ credit were false is found in Paragraph 23 (page 7 lines 2 and 3), and more fully demonstrated in the paragraphs that are “incorporated by reference” into the Slander of Credit Cause of Action (including, but not limited to, paragraphs 10, 12, 13, 14, 16, and 18) of the VFAC. The allegation of malice is contained in Paragraph 23 (page 6 line 28 through page 7 line 3), and more fully described in the paragraphs that are “incorporated by reference” into the Slander of Credit Cause of Action (including, but not limited to, paragraphs 10, 12, 13, 14, 16, and 18) of the VFAC.

C.        The defendant again asserted and the trial court may have considered improper and irrelevant extrinsic evidence: Defendant once again argued in its Demurrer that the court should consider plaintiffs/appellants’ statement in their Ex Parte Application for a Preliminary Injunction that they are having “difficult financial times” and were having trouble making ends meet to be proof that they failed to remain current on their mortgage (CT 13, lines 22-25). Again, this should not have been argued by the defendant nor considered by the court.

Issue 9

THE PARAGRAPHS REGARDING PUNITIVE DAMAGES, THOUGH MISLABLED AS A “CAUSE OF ACTION,” WERE PROPERLY PLEAD

            A.        Elements of Punitive Damages: Punitive damages require a pleading that the defendant has been guilty of oppression, fraud, or malice with respect to an obligation that did not arise from contract (Civil Code § 3294).

B.        The elements of punitive damages, though properly plead, were mislabeled as a “cause of action,” which should be disregarded as a trifle, with substance being honored over form: The defendant properly argued that punitive damages are not a separate cause of action. However, they still must be plead. Whether it is labeled as a “cause of action” or just a paragraph pleading exemplary damages, the so-called Sixth Cause of Action contains necessary elements to request punitive or exemplary damages as required by Code of Civil Procedure § 425.12 and Civil Code § 3294, and is very similar to Judicial Council Form PLD-PI-001(6). Therefore, if paragraphs 24 and 25 of the VFAC were merely labeled differently, defendant would have no argument whatsoever. Further, pursuant to Civil Code § 3528, the court is to honor substance over form, so defendants’ argument that form should be given a higher priority than substance is contrary to California law. Also, Civil Code § 3535 provides that the Law disregards trifles, so the most that should have happened is that the label “Sixth Cause of Action” should have been stricken and the remaining label and paragraphs should have remained intact.

Issue 10

IF THE DEMURRER IS OVERTURNED, THE MOTION TO STRIKE WILL NO LONGER BE MOOT, SO THAT THE TRIAL COURT SHOULD RECEIVE INSTRUCTIONS REGARDING THE LAW ON THOSE ISSUES

            A.        The Trial Court ruled that the Motion to Strike was Moot due to the sustaining of the Demurrer: The trial court first sustained the demurrer (RT 4, line 22 through 5, line 4). Then the court ruled that the Motion to Strike was moot (RT 5, lines 9 through 11).

B.        If the sustaining of the Demurrer and the order of dismissal are overturned, the Motion to Strike will no longer be moot and the court may need to instruct the trial court: Plaintiffs/appellants are seeking the overturning of the sustaining of the Demurrer and the resulting order of dismissal. If that happens, the Motion to Strike will no longer be moot. Since the Motion to Strike was not granted, plaintiffs/appellants are not briefing those issues. However, plaintiffs/appellants request that this court consider reviewing the portions of the record and augmented record that include the Motion to Strike and the plaintiffs’/appellants’ opposition thereto and further consider making appropriate instructions to the trial court on those issues.

CONCLUSION

            The trial court erred in sustaining the demurrer without leave to amend and entering a judgment of dismissal. The rules of a non-judicial foreclosure proceeding and litigation to set aside a non-judicial foreclosure do not apply to a quiet title action that is filed prior to a foreclosure sale. The Commercial Code’s requirements that the entity enforcing a note must possess the original note (with limited exceptions) applies to a Note Secured by Deed of Trust. The Commercial Code’s requirements that the perfection of a security interest in real property requires possession of the original note applies to a Note Secured by Deed of Trust. Even in the context of a non-judicial foreclosure, there is no “breach” unless the entity that did not receive the mortgage payments had a right to receive the mortgage payments through possession of the original note or compliance with another recognized exception under the Commercial Code. Any other result would cause an unnecessary conflict of laws and allow fraudulent “lenders” to engage in non-judicial foreclosures and sales of property so long as they complied with the technical requirements of a non-judicial foreclosure. All of the causes of action of the Verified First Amended Complaint are properly plead, with the exception that “punitive damages” is not technically a cause of action, but that can be resolved by striking the label “Sixth Cause of Action” and just allowing the heading “Punitive Damages” to stand.

 

RESPECTFULLY SUBMITTED,

            Dated: 10 June 2010                                                                                                                            

Michael D. Finley, Esq.

Counsel for Plaintiffs/Appellants

Mark J. DeMucha & Cheryl M. DeMucha

 

 

CERTIFICATE OF COMPLIANCE

Pursuant to rule 8.204(c) of the California Rules of Court, I hereby certify that this brief contains 5,800 words, including footnotes. In making this certification, I have relied on the word count of the computer program used to prepare the brief.

 

Dated: 10 June 2010                                                                                                                            

Michael D. Finley, Esq.

Counsel for Plaintiffs/Appellants

Mark J. DeMucha & Cheryl M. DeMucha

 

AMENDED PROOF OF SERVICE

STATE OF CALIFORNIA, COUNTY OF LOS ANGELES

I am employed in the County of Los Angeles, State of California. I am over the age of 18 and not a party to the within action; my business address is: 25375 Orchard Village Road, Suite 106, Valencia, CA 91355-3000.

On 10 June 2010 (and on 14 June 2010 as indicated below) I served the foregoing document described as: Appellant’s Opening Brief on the interested parties in this action by placing a true copy thereof in sealed envelopes addressed as follows:

(Attorneys for Wells Fargo Home Mortgage, Inc. & Wells Fargo Bank, N.A.): Kutak Rock LLP, 18201 Von Karman, Suite 1100, Irvine, CA 92612

(Attorneys for First American Loanstar Trustee Services & First American Corporation): Wright, Finlay & Zak, LLP, 4665 MacArthur Court, Suite 280, Newport Beach, CA 92660

(6/14/2010): Judge Sidney P. Chapin, Kern County Superior Court, Metropolitan Division, 1415 Truxtun Ave., Bakersfield, CA 93301

BY MAIL: I deposited such envelopes in the mail at Valencia, California. The envelopes were mailed with first class postage thereon fully prepaid.

ALSO, BY ELECTRONIC FILING WITH THE SUPREME COURT: In addition, I filed an electronic copy of the Appellant’s Opening Brief with the Supreme Court of California on 14 June 2010, through the Supreme Court’s website.

Dated: 14 June 2010                                                                                                                            

Michael D. Finley, Esq.

Counsel for Plaintiffs/Appellants

Mark J. DeMucha & Cheryl M. DeMucha

Challenge Your Lender… Now!

13 Dec

Don’t delay – Opt in to the follow Blog and gain access to over 680 ideas and posts to hold your Lender accountable new post every day!

Do you want to hold your lender responsible for their illegal actions?

Challenge Your Lender… Now!

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My name is Timothy McCandless, and I’m here to tell you what most banks and mortgage loan servicers don’t want you to know: More than 65 million homes in the US may not be subject to foreclosure after all, and your home is very likely one of the “safe” homes. The reason these homes are not technically subject to foreclosure is because the lenders, mortgage companies, mortgage servicers, and title companies broke the law throughout the process of managing your loan, both at the inception of your loan and throughout the life of the loan. Because of their fraudulent actions, they are unable to produce a title for, or show ownership of, your property. This causes what we call a “defect of title”, and legally prohibits your lender or servicer from foreclosing, regardless of whether or not your loan is current.

This situation is all over the news, and now, starting today, you can learn how to protect yourself from unlawful foreclosure.

WE CAN TRAIN YOU HOW TO CHALLENGE YOUR LENDER

Most Mortgage Assignments are Illegal

In a major ruling in the Massachusetts Supreme Court today, US Bank National Association and Wells Fargo lost the “Ibanez case”, meaning that they don’t have standing to foreclose due to improper mortgage assignment. The ruling is likely to send shock waves through the entire judicial system, and seriously raise the stakes on foreclosure fraud. Bank stocks plummeted after this ruling. These assignments are what people need to challenge in their own mortgages.

I am prepared to show you the most amazing information on how you can actually Challenge Your Lender. Once you opt in for our free ebook (just enter your email address above and to the right), you’ll get immediate access to our first, very informative webinar, as well as to our free ebook. You’ll learn more about the Challenge Your Lender program, and more importantly, how the US mortgage system is rigged to take advantage of you and how to can fight back. My program will show you exactly how to get a copy of your loan documents that your lender or loan servicer currently has in their possession, and then how to begin examining these documents to learn more about how your lender, as well as other parties involved, has used your name and credit to make millions of dollars. Analyzing your loan documents is a crucial first step in beginning the Challenge Your Lender process.


Save your home from foreclosure

The information that you will be receiving in my free material and webinar will further your knowledge on what most lenders are doing to homeowners, and how you can save yourself from foreclosure. You will have the opportunity to acquire a free copy of my Challenge Your Lender workbook and learn how to begin building the paper trail that you will need to defend yourself and to prove the wrongdoings of your lender and loan servicer. Once you go through the workbook and listen in on the free webinar, you will be on top of your Challenge and ready to begin the program.

The Challenge Your Lender program will help put you in a position of power and control over your loan, and will allow you to decide what you would like to do with your property. This leverage will be advantageous when you begin negotiating your foreclosure. Most importantly, your lender or loan servicer should not be able to foreclose on you once you notify them that you have identified fraudulent activity. My program is your first step in saving your property from foreclosure.

Don’t wait – opt in today. Every day counts in the battle against your lender.

Best regards,
Tim

Register of Deeds, Jeff Thigpen, Is Not Playing Around – A Mandelman Matters Podcast 15

13 Dec

Jeff Thigpen is the Register of Deeds for Guilford County in Greensboro, North Carolina. The way he explains it, he has two primary responsibilities: 1. To protect the chain of title when property changes hands. 2. A fiduciary duty to collect recording fees. And the fact is that MERS has pretty much blown a hole right through both of those things.

But, you see… Jeff is not your ordinary Register of Deeds. Like his counterpart John O’Brian in Massachusetts, Jeff takes his job pretty seriously, which makes sense since his job has been around for some 300 years. And so he put his foot down… right on top of MERS.

According to Jeff…

“For me, the question is clear. Do we want land records in America to be governed by major banking conglomerates on Wall Street or the people and laws of the United States of America?”

For me that’s an easy question to answer because I don’t even want the major banking conglomerates on Wall Street governed by the major banking conglomerates on Wall Street, if you know what I mean.

Well, I caught up with Jeff after receiving a “friend request” from him on Facebook… I recognized the name right away and sent him a note asking him to join me for a podcast… and he said yes, of course. a Mandelman Matters podcast is THE place to hear and be heard, don’t you know.

And on a serious not, I truly believe that EVERY SINGLE ADULT in America should listen to what Jeff says on this podcast… I mean it… it’s not just about foreclosures… this affects everyone in the country… 300 year old property rights laws. From talking to Jeff, I now realize what a big deal this mess is as far as robo-signing and MERS goes… we simply cannot allow the banks to gloss over these issues with statements like “sloppy paperwork.” It’s a whole lot more meaningful that that, as Jeff will very clearly exaplain.

So, please pass it along to other homeowners you know… they need to hear it whether they’re at risk of foreclosure… yet… or not.And her we go… it’s Jeff Thigpen from North Carolina… just click the PLAY button below, turn up your speakers and tell me what you thought when it’s done… I just know you’re going to like it a whole lot.

I have to tell you, I sure did enjoy talking to Jeff… he’s the kind of person we need in government today… and if he ever decides to run for office… I’m volunteering to run his campaign.

Mandelman out.

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