Suit for violation of Bankruptcy Stay 11 USC 362 K Ocwen loan servicing

14 Jun

TO THE DEFENDANTS:

Plaintiff, FAYE MYRETTE CROSLEY complains against the above-captioned Defendants (collectively, the “Defendants”), and each of them, as follows:

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  1. Plaintiff, FAYE MYRETTE CROSLEY, (hereinafter referred to as “Plaintiff”) is the Debtor in the underlying bankruptcy case and reside at 6262 Highland Avenue, Richmond, California 94805.
  2. Defendant OCWEN LOAN SERVICING, LLC, (hereinafter referred to as “OCWEN”) is a Delaware limited liability corporation with its principal place of business in West Palm Beach, Florida, and was at all times herein mentioned, engaged in business as a bank and/or servicer of mortgage loans in the County of Contra Costa, State of California, including Plaintiff’s loan file, Note and DOT.
  3. Defendant RESIDENTIAL CREDIT SOLUTIONS, INC., (hereinafter referred to as “RESIDENTIAL”) is a Delaware corporation with its principal place of business in Fort Worth, Texas, and was at all times herein mentioned, engaged in business as a bank and/or servicer of mortgage loans in the County of Contra Costa, State of California, including Plaintiff’s loan file, Note and DOT.
  4. Defendant DITECH FINANCIAL, LLC, (hereinafter referred to as “DITECH”) is a Delaware limited liability corporation with its principal place of business in Saint Paul, Minnesota, and was at all times herein mentioned, engaged in business as a bank and/or servicer of mortgage loans in the County of Contra Costa, State of California, including Plaintiff’s loan file, Note and DOT.
  5. Defendant LAW OFFICES OF LES ZIEVE, (hereinafter referred to as “LES ZIEVE”) is a California corporation, with its principle place of business in Irvine, California, on information and belief and at all times mentioned in this Complaint was engaged in the business of litigation, bankruptcy, evictions, loss mitigation, loss prevention, title claims, and all other aspects of creditor rights, including foreclosure, and acting as trustee for banks, mortgage holders and lien holders in the county of Contra Costa, California.
  6. Defendant COMMUNITY FUND, LLC, (hereinafter referred to as “COMMUNITY”) is a California limited liability corporation, with its principal place of business in San Leandro, California. On information and belief and at all times mentioned in this complaint was engaged in the business of purchasing properties at the foreclosure sales in the

County of Contra Costa, State of California, including Plaintiff’s property. ,

  1. Plaintiff is ignorant of the true names and capacities of Defendants sued herein as DOES 1 through 50, inclusive, and therefore sues these Defendants by such fictitious names and all persons unknown claiming any legal or equitable right, title, estate, lien, or interest in the property described in this complaint adverse to Plaintiff’s title, or any cloud on Plaintiff’s title thereto. Plaintiff will amend this complaint to allege their true names and capacities when ascertained.
  2. Plaintiff is informed and believes and therefore alleges that at all times mentioned, each Defendant was the agent and employee of the remaining Defendants, and in doing the things alleged, was acting within the course and scope of that agency and employment.
  3. Jurisdiction of this Court is proper pursuant to 28 U.S.C. § 157 (b)(1) in that this action arises under the Chapter 7 bankruptcy case In re FAYE MYRETTE CROSLEY filed in this district and division at docket 16-40003 WJL-7 and is a core proceeding.
  4. At all times relevant to this complaint, Plaintiff was the owner of certain real property located within the County of Contra Costa, State of California commonly known as 6262 Highland Avenue, Richmond, California 94805, (hereinafter referred to as the “Subject Property”). The legal description of the property is as follows:

 

ALL THAT CERTAIN LAND SITUATED IN THE UNINCORPORATED AREA       OF THE COUNTY OF CONTRA COSTA, STATE OF CALIFORNIA, AND       DESCRIBED             AS FOLLOWS:

 

ALL OF LOT 32 AND THE SOUTHEASTERN 20 FEET (FRONT AND REAR MEASUREMENTS) OF LOT 31, IN BLOCK 99, AS SHOWN ON THE MAP ENTITLED, “MAP OF EAST RICHMOND HEIGHTS TRACT NO. 2, CONTRA COSTA COUNTY, CALIFORNIA”, FILED ON FEBRUARY 2, 1911 IN THE OFFICE OF THE COUNTY RECORDED OF SAID COUNTY, IN BOOK 4 OF MAPS, PAGE 90.

 

APN: 521-031-002-4

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  1. On or about September 9, 2015, Plaintiff filed a case against Defendants in the Superior Court of California, Contra Costa County, Case No.: CIVMSC15-01688, for violation of the California Home Owners Rights, beach of loan modification contract, elder abuse, violation of Rosenthal Fair Debt Collection act, slender of tile. Defendant OCWEN were represented by Defendant LES ZIEVE.  Furthermore Defendant LES ZIEVE was the foreclosure trustee and agent for current beneficiary or loan servicer under Plaintiff’s Note and DOT, for which Plaintiff was unaware, nor has she received any notices regarding the change of the beneficiary or the loan servicer, under her Note and DOT.
  2. The sale of the Subject Property was scheduled for January 4, 2016.
  3. On December 31, 2015, Plaintiff informed her counsel in the case filed in Contra Costa County, that she will be filing for protection under the bankruptcy Chapter 7, to stop the Subject Property.
  4. Thereafter, Mr. Timothy L. McCandless, the Plaintiff’s counsel informed Defendants’ counsel Mr. Ryan K. Woodson of Plaintiff’s intentions and her filing for the protection under the bankruptcy Chapter 7. See Declaration of Mr. Timothy L. McCandless a true and correct copy of which is attached hereto and incorporated by reference as EXHIBIT 1, In re FAYE MYRETTE CROSLEY filed in this district and division at docket 16-40003 WJL-7 # 18.
  5. Plaintiff filed her Chapter 7 case on January 4, 2016.
  6. An order for relief was entered in this case on January 4, 2016, pursuant to 11 U.S.C § 301, thus triggering an automatic stay, pursuant to 11 U.S.C. § 362(a) of all debt collection against the Debtors.
  7. Plaintiff’s counsel Mr. Timothy L. McCandless, instructed his assistant Mr. Eric Santos, to be present at the scheduled sale of Plaintiff’s property at place of the sale, Pleasant Hill Community Center, 320 Civic Drive, Pleasant Hill, California 94523, and once he receives info from Plaintiff and her bankruptcy filing, to inform the party conducting the sale and all potential buyers, that Plaintiff had filed for the protection under bankruptcy Chapter 7 filing, and that the sale of her property will be in violation of bankruptcy stay if conducted, See EXHIBIT 1.
  8. Eric Santos, per the instruction, informed the person handling the sale of the Subject Property, and was informed that the sale was canceled. See Declaration of Mr. Eric Santos a true and correct copy of which is attached hereto and incorporated by reference as EXHIBIT 2, In re FAYE MYRETTE CROSLEY filed in this district and division at docket 16-40003 WJL-7 Dkt. # 19.
  9. Notwithstanding the fact that notice of filing for protection under Chapter 7 was given to Defendants timely, the Subject Property was auctioned on January 7, 2016, Seecom web site printout a true and correct copy of which is attached hereto and incorporated by reference as EXHIBIT 3.
  10. On or about January 13, 2016, Plaintiff received letter and 3-Day Notice to Vacate from COMMUNITY as the new owner of the Subject Property, See letter dated January 13, 2016 along with 3-Day Notice to Vacate a true and correct copy of which is attached hereto and incorporated by reference as EXHIBIT 4.
  11. The fees that Defendants caused to be assessed against the Subject Property and which it attempted to collect from the Plaintiff were never disclosed to the bankruptcy court.
  12. The Defendants’ conduct has caused Plaintiff to experience worries and concerns that are separate from the anxiety she felt about the bankruptcy. Plaintiff’s reactions and emotions were not fleeting or inconsequential. Plaintiff suffered significant emotional harm as a result of Defendants’ conduct in willfully violating the automatic stay.  The circumstances surrounding the violation make it obvious that a reasonable person would suffer significant emotional harm. Plaintiff suffered actual damages in the forms of out-of-pocket expenses, attorney’s fees, and emotional distress.
  13. This case presents the Court with a classic example of the tangled web that the mortgage industry has created that to their chagrin has left them without the lawful ability to foreclose on a property they claim a home loan is secured by. In addition, the case also presents this Court with a classic example that this lenders play with regard to the governmental mandate to engage in loan modification and their refusal to do so, all the while leading the borrowers such is Plaintiff in this instant case, to believe he or she has a loan modification, only to be ambushed with a foreclosure.

COUNT I – STAY VIOLATION

  1. The foregoing paragraphs are incorporated herein by reference.
  2. Defendants’ conduct violated 11 U.S.C. § 362(a).

WHEREFORE, Plaintiff requests an Order declaring the Defendants are guilty of civil contempt by violating the automatic stay; and awarding Plaintiff compensatory damages, punitive damages, and costs pursuant to 11 U.S.C. § 362(k) and for contempt of Court.

COUNT II – DAMAGES

  1. The foregoing paragraphs are incorporated herein by reference.
  2. Defendants’ stay violation was willful.
  3. Defendants’ counsel was also aware of the bankruptcy filing; in fact Defendants’ agent was repeatedly warned by the Plaintiff’s attorney that sale of the subject property would violate the automatic stay and will not be warranted.
  4. Defendants’ acts were willful, shameless, deliberate, calculated, scheming, intentional, and done with complete and total disregard for the financial and emotional harm that would befall the Plaintiff, despite her protected status of senior citizen, and despite the fact that she was caregiver to her 51 year old daughter legally blind and deaf and in wheelchair.

WHEREFORE, Plaintiff requests an award of damages fees pursuant to 11 U.S.C. § 362(h).

COUNT III – INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS

  1. The foregoing paragraphs are incorporated herein by reference.
  2. This outcome has been created without any right or privilege on the part of the Defendants, and, as such, their actions constitute outrageous or reckless conduct on the part of Defendants.
  3. Defendants’ conduct – fraudulently engaging in the foreclose process and foreclosing on the Subject Property in which they had no right, title, or interest – was so outrageous and extreme that it exceeds all bounds which are usually tolerated in a civilized community.
  4. Such conduct was undertaken with the specific intent of inflicting emotional distress on the Plaintiff, such that Plaintiff would be so emotionally distressed and debilitated that she would be unable to exercise legal rights in the Property; the right to title of the Property, the right to cure the alleged default, right to verify the alleged debt that Defendants are attempting to collect, and right to clear title to the Property such that said title will regain its marketability and value.
  5. At the time, when Defendants began their fraudulent foreclosure proceedings, Defendants were not acting in good faith while attempting to collect on the subject debt.
  6. As an actual and proximate cause of Defendants’ fraudulently foreclosing on the

Plaintiff’s home and in violation of automatic stay, the Plaintiff has suffered severe emotional distress, including but not limited to lack of sleep, anxiety, and depression.

  1. The conduct of Defendants, and each of them, as herein described, was so vile, base, contemptible, miserable, wretched, and loathsome that it would be looked down upon and despised by ordinary people. Plaintiff is therefore entitled to punitive damages in an amount appropriate to punish Defendants and to deter other from engaging in similar conduct.

WHEREFORE, Plaintiff requests an award of damages for intentional infliction of emotional distress.  

COUNT IV – ATTORNEY’S FEES

  1. The foregoing paragraphs are incorporated herein by reference.
  2. Plaintiff is entitled to attorney’s fees pursuant to 11 U.S.C. § 362(k).

WHEREFORE, Plaintiff requests an award of reasonable attorney’s fees pursuant to 11 U.S.C. § 362(k).

 

Respectfully submitted,

DATED: June 13, 2016                      LAW OFFICES OF TIMOTHY L. MCCANDLESS

 

/s/ Timothy L. McCandless                                                                                                                  Timothy L. McCandless, Esq.                                                                                                            Attorney for Plaintiff(s): Faye Myrette Crosley

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