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Monthly Archives: January 2014

In Texas, Mortgage Servicing Fraud is REAL !

21 Tuesday Jan 2014

Posted by BNG in Foreclosure Defense, Fraud, Judicial States, Loan Modification, Non-Judicial States, Pro Se Litigation, Scam Artists, Your Legal Rights

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Avoid being cheated out of your home before it’s too late!
DO IT THE WAY THEY DO IT: SUE FIRST, ASK QUESTIONS
LATER!
The mortgage servicing fraud scam is real. I personally have lived and litigated it in court from beginning to end. Your mortgage servicer will take thousands of dollars from you, lose or misapply your payments,
and then kick you and your family right out of your home. I know
that this scam is real because I have lived though
it. I also know that the scam is real because in the course of my lawsuit against the mortgage servicer and their debt collector, I have read a lawsuit against the debt collector where the owners of the debt collection firm were sued by a
former mortgage servicer employee that they promised an ownership i
nterest in their business if she would teach them how to setup the “high-volume foreclosure” scam. The same debt collector also saw fit to brag on his company’s own website that he “specialized in foreclosures and evictions… using specially-trained paralegals and computer technology.” Their website also bragged that they would provide the mortgage servicer with a monthly status report on the number of foreclosures and evictions they had done for them.
The scam from beginning to end…
I think this scam has grown out of the “real estate
boom” that we’re in. People are buying 3 or 4 houses at a
time and getting the mortgages to go along with the
m. The homeowners buy the homes, get the mortgages, and the
mortgage servicing companies are there waiting to get the servicing rights, skim fees off the top, and then eventually move in with foreclosures and forbearance agreements. The real estate broker gets paid, the mortgage
processor gets paid, the lender gets paid, the mortgage servicer gets paid, the debt collector gets paid, and the consumer loses all their money and eventually their home. The economics of this scam break down into two parts: the servicing part and the legal cost part.• The servicing part of the scam is very straight forward. The servicer is buying your Note from the lender or previous servicer with their credit, but taking your real cash to make their payments. Nothing or next
to nothing from each of your mortgage payments is going to your principal balance. So the mortgage servicer is just plain pocketing all that money. The mortgage servicer is pocketing the entire payment plus whatever
other fees they can get you to pay. Over the course of five years as a customer, you’ll have paid none of your principal, plus then they find a way to sell your home all at once for complete, immediate cash at a foreclosure sale auction. The mortgage servicer then recycles that money into their own business cash flow and for buying servicing rights for another loan and pulling the same scam on someone else. There is no risk at all for the servicer.
• The legal cost part of the scam is when you as a customer fight them in court to keep your house. You’ll hear a lot of people say that these guys have infinite legal resources. The bottom-line is that they do have lawyers and debt collector that process so many of these foreclosures that they have the written forms, including the lawsuit forms, all prepared and do many, many of these foreclosures at once. The way it usually works, I believe, is that these debt collectors get paid by the debt they collect (by adding their own fees to
the reinstatement amount) or by the foreclosure. If the debt collector doesn’t get the homeowner to pay their fees or foreclose, then they don’t get paid. If you can get the debt collector sued and into court, you’ll
hear a lot about how they want you to pay their fees. The bottom-line is that you can’t get blood from a stone. Even if the debt collector could win the lawsuit, most home owners don’t have anything of value to satisfy a
judgment and pay the debt collector anyway. As such, all through litigation the mortgage servicer ends up paying the debt collector themselves. Basic math shows that the more litigation costs the mortgage servicer, the
less worthwhile it is to continue foreclosure proceedings and litigation against the homeowner.
REMEMBER: These guys pull this scam on many people
every day. As a consumer, you only deal with it once. These guys make their money by pulling the scams as quick as possible. The goal is to get you foreclosed or to sign a forbearance agreement as quickly as possible. They
want it resolved as quickly as possible. The home owner survives and prevails by making the lawsuit and the process take as much time as it needs to be to get done properly and put the mortgage servicer and debt collector in their p
lace. The house belongs to you, not them. They just made a written
promise to finance the money to pay for the house. They break the promise when they try to sell your house.
Scam 0 – You can’t get away from us
Your loan gets transferred or sold from the lender or some sort of “
trustee” or a previous servicer. In addition, somehow there
’s also some other ‘attorney in fact’ company or trustee involved.
The actual paperwork they would provide to the court if you were to sue them would say something like “<homeowner> executed a Note and a Deed of Trust for the benefit of <original lender>. The Note and Deed were assigned to <some company you’ve never heard of> as Trustee. <Current servicer> is the current servicer and attorney in fact for <Trustee>.” There’s an old ma
gic trick where someone puts a ball under one of three cups and then moves the cups around. This is the legal equivalent of that.
The goal is to keep you from knowing who the hell to sue. It’s also to set everything up where none of the companies has to take responsibility. It’s
also to keep you from getting away from them. Once your loan is obtained by the servicer, you only have three ways to get away from them: just plain let them foreclose on your house, refinance (and pay all the $5,000 or $10,000 refinancing fees), or sue them. There’s no other way out. While you “be
long” to them during their servicing, they can charge you whatever fees they feel like and you’re in no position to argue.
Scam 1 – Lose or misapply payments to charge fees
and interest-on-top-of-the fees
First, the mortgage servicer will lose or misapply your payments or put them in an escrow. They will then charge you fees and interest-on-top-of-the-fees for
the misapplied funds.
Scam 2 – Fabricate a default to sell home or talk
homeowner into forbearance
After losing or misapplying your payments, the mortgage servicer will fabricate a default. The default is intended to either sell your home and get all their
money at once, or talk the homeowner into paying money they
don’t owe for fees and a forbearance agreement.
BE CAREFUL: THE FORBEARANCE AGREEMENT WAIVES YOUR RIGHT TO FUTURE NOTICES OF INTENT TO SELL YOUR HOME.
Scam 3 – Harass the homeowner, scare them with foreclosure, and don’t follow legal guidelines for notices
Unable to talk the homeowner into paying money they
don’t owe or sign the forbearance agreement, the mortgage servicer hands off the debt to a third-party debt collector, whose job it is to harass and threaten foreclosure of the home. The goal is to provide as little notice as possible before foreclosure of the home so that the homeowner can’t get his paperwork ready or file suit and they can just sell the home. The mortgage servicer and the debt collector have no intention of stopping during a dispute.
Another goal is to keep leading the homeowner on long
enough to prevent him from filing suit, getting a restraining order,
or filing for bankruptcy. The goal is to make selling the homeowner’s home as quick and efficient and “clean” as possible. As soon as it’s sold, they’ve won and gotten their money. The homeowner can only argue a wrongful foreclosure after-the-fact. At that point, it’s too late and the debt collector is moving in with procedures to get the homeowner and his family out of there and eventually the homeowner just plain gives up fighting them because they’ve already lost their home. Keep all the envelopes and letters you receive! Those postmark dates on the envelopes are VERY important.
In Texas, the law (Texas Property Code section 51.002) requires the mortgage servicer to give the homeowner 20 days notice BEFORE posting public notice of intent to sell. The public notice of intent to sell must also be posted 21 days BEFORE the sell. So all in all, you legally have at least 41 days to find a way to deal with this situation.
Scam 4 – Make homeowner think he has to keep making
payments after filing suit
If the homeowner can get a restraining order or a preliminary injunction, the debt collector will send a litigator that won’t let the homeowner get a word in edgewise. The main goal is to prevent the homeowner from getting a restraining order/injunction. The secondary goal if they can’t get the tro/injunction is to make the homeowner feel obligated to keep making payments (the debt collectors and mortgage servicers have a name for this. The term is the “post-petition payments”).
THE HOMEOWNER DOES NOT HAVE TO KEEP MAKING PAYMENTS. THEGOAL WITH MAKING THE HOMEOWNER CONTINUE TO MAKE PAYMENTS IS TO FORCE THE
HOMEOWNER TO GIVE UP HIS RIGHT TO SUE FOR TOTAL BREACH OF CONTRACT.
The court has its own form of a bank called the “registry of the court”. The homeowner should argue to the court to NOT make payments at all until a trial can be held. If the homeowner can’t convince the court for that, the homeowner should argue to place ALL subsequent payments until trial into the court’s registry. To preserve your rights to sue the mortgage servicer for total breach, the homeowner MUST convince the court to either disregard payments until trial or put all payments into the registry of the court.
Scam 5 – Create second default by making homeowner
pay after filing suit
By making the homeowner continue to make payments even if there’s a tro/injunction, the mortgage servicer and their debt collector can create a second default that trivializes the previous default.
The mortgage servicer and their debt collector can put a foreclosure on the homeowner’s credit report and mess up the homeowner’s credit so that there’s a second default even after the tro/in
junction. Putting the foreclosure on the homeowner’s credit also virtually guarantees that the homeowner can’t do any sort of refinancing during this time. The mortgage servicer can then say “well,
he’s fallen behind again. Please dissolve the injunction and let us sell his home.” Alternatively, the mortgage servicer or their “attorney” (the third-party debt collector) will tell the homeowner that they’ll be thrown in jail or held in contempt of court for refusing to pay the mortgage company more money and try and convince the homeowner that they’re “stealing” use of the home.
Check your state laws. I would guess in ALL states, “debtor’s prisons” are illegal. You can’t be thrown in jail
for refusing to pay a debt (except child support, which isn’t actually considered a debt but an obligation). In Texas, Texas Constitution Article 1, Section 18 states specifically, “No person shall ever be imprisoned for debt.” REMEMBER: YOUR MORTGAGE IS NOT A RENTAL
AGREEMENT. IT’S A PROMISE TO FINANCE THE PURCHASE OF YOUR HOME
Scam 6 – Make homeowner think filing for bankruptcy
gives up right to sue
If the homeowner files for bankruptcy during the
injunction period, the mortgage servicer will argue
for judicial estoppel to try and get out of the lawsuit
and the injunction.
Scam 7 – Debt collector’s get-out-quick scam
The third-party debt collector and its officers are
used to being sued constantly. As soon as the
homeowner files suit, the debt collector will follow-up with
a motion to dismiss the claims against them and get
out of the lawsuit. The goal for the debt collector is to get out of
the lawsuit permanently (with a “dismissal with
prejudice”) before the homeowner can prepare a response or know what the debt collector is doing. The debt collector will
say that your issues are with the mortgage servicer and not them.
That is wrong. You’re entitled to sue everyone
and every company that had involvement in selling your house.
They’ll say “we’re the trustees and not liable.”
That’s not true. Don’t let them out of the lawsuit.
Scam 8 – Make the homeowner think its his own fault
The actual lawsuit scam itself is to hope that the
homeowner doesn’t have any receipts or paperwork.
“Sub-prime” homeowners are easy targets because they’re
not usually prepared or organized to produce
paperwork fast enough (if at all). If the homeowner can prove the
payments and can get the mortgage servicer to the
trial, the goal is to show the jury (or judge, in bench trial) that th
e homeowner is at fault. If the homeowner can prove
liability, the goal is to convince the jury that the homeowner is
only entitled to applying the payments that the
mortgage company should have applied in the first place. The truth
is that the mortgage servicer broke the contract an
d tried to sell the plaintiff’s home. When the mortgage servicer broke
the contract, they stopped being entitled to more
money. They try to sell the home to get their money. When they
get caught and restrained before they get away with it, they try to still get more money from the homeowner as a backup
plan or tell the homeowner that he can refinance.
Trying to get more money from the homeowner or get the homeowner
to refinance doesn’t hold the mortgage servicer liable. It just
insures that they get their money one way or another.
The mortgage servicer and their debt collector prey
on the fears of the homeowner by using the lien that they have on the homeowner’s house as “ransom” for more
money. Most people can’t afford to get a jury trial or adequate legal representation, so the homeowner gives in to
the ransom even though at this point the mortgage s
ervicer and debt collector are only entitled to NOTHING from the homeowner. The legal terms for this are “duress
of property” and “unjust enrichment.”
Scam 9 – Make the homeowner think he has to post a
bond to sue them.
If the homeowner files suit, the mortgage servicer
and their debt collector will want the homeowner to
post a bond to maintain the suit. Texas law (Texas Civil
Practice & Remedies Code section 65.041 & 65.042)
specifically prevents the courts from making a homeowner post a
bond in a lawsuit to prevent foreclosure of their
home but the debt collector knows that most homeowners don’t kno
w that. Not being able to post the bond is another
way that the servicer/debt collector can strong-arm the homeowner out of the lawsuit.
Scam 10 – Make the homeowner think they have to deal with them
One of the debt collector’s jobs is to draw the homeowner into dealing with them. They have to draw the homeowner into “working with” them to talk them into money or doing what they want. The entire time, the debt
collector is planning on selling the consumer’s home or working towards a forbearance agreement. The goal in this scam is specifically to get the
homeowner to feel like they have to answer to the debt collector
and mortgage servicer and convince the homeowner that they owe the debt collector and mortgage servicer something. The other goal is to convince the homeowner that they need to work directly with the debt
collector or mortgage servicer and that they need to answer to
the servicer/collector and not go to the courts or
deal with the courts. DON’T DEAL WITH THESE DEBT COLLECTORS OR SERVICERS AT ALL COSTS. GO STRAIGHT
TO THE COURT AND FILE SUIT AGAINST EVERYONE
INVOLVED BEFORE YOUR HOME IS SOLD. GET
A RESTRAINING ORDER. REFUSE TO SIGN ANYTHING THE DEBT COLLECTOR GIVES YOU TO SIGN.
Scam 11 – Make debt collector appear legitimate
The debt collectors hired by the mortgage servicer
may contain attorneys to appear legitimate. The debt
collector may even be owned by an attorney. These
attorneys are shady characters that are the bottom
of the barrel attorneys that got licensed simply so that they could find a way to rip people off and con them by telling them that they’re lawyers. Check your state laws. Texas law (Texas Finance Code 392.101) requires debt collect
ors to have a bond on file with the secretary of state to engage
in third-party debt collection. The secretary of s
tate will provide any consumer with a “certificate of no record” if the debt collector does not have the bond on file.
If the debt collector doesn’t have the bond on file, then they have no right to be engaging in debt collection in the first place. If the debt collector is soliciting money from you and they don’t have that bond on file, then they’re engaging in illegal debt collection activity. Don’t pay them anything and file a complaint with the attorney general’s office.
In Texas, we have the Texas Deceptive Trade Practices Act. It’s designed to protect consumers from false, misleading, and deceptive businesses. If a debt collector does not have a bond on file with the state
to engage in debt collection, then that is specifically defined by law (Texas Business & Commerce Code section 17.46(b)(24)) as
“failing to disclose information concerning goods or services which was known at the time of the transaction if such failure to disclose such information was intended to induce the consumer into a transaction into which
the consumer would not have entered had the information been disclosed.” Would you pay the debt collector if you knew they had no right to solicit money from you? Absolutely not.
Scam 12 – Make the homeowner think he has to pay the legal fees
When the mortgage servicer and the debt collector get sued, they have a legal fees scam they use to con the homeowner into thinking the homeowner can’t afford to fight the lawsuit. The mortgage servicer and debt collector will add a paragraph in every one of their filings with the court that asks the court to award them some giant attorney fee (like $500 or $700) for the filing of that pleading. No court in their right mind would ever award the attorney any
money for filing a routine pleading, let alone a giant $500 or $700 fee for filing a pleading. But there’s no law against requesting it, and the fee is only requested for the purpose of harassing the homeowner and scaring them into thinking they might have to pay it. Also, as a matter of  law, the “winner” to a lawsuit doesn’t pay the loser’s fees. It’s the opposite: the loser pays the winner’s fees, but even then only if the court awards the winner the fees.
Scam 13 – Prior breaches scam
When you sue a mortgage servicer or debt collector,
they will argue that your prior breaches still allow them to sell your house. As a matter of law, it is a well-established principal of contract law that when
one party to a contract honors a contract in any way, such as accepting your money as payment on the contract, they waive all breaches prior to that as a defense for breaking the contract later. In short, whenever the mortgage servicer accepts your money, they give up the right to sue or break the contract for anything

before that moment

If you find yourself in an unfortunate situation of losing or about to your home to wrongful fraudulent foreclosure, and need a complete package  that will help you challenge these fraudsters and save your home from foreclosure visit: http://www.fightforeclosure.net
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How Homeowners Can Effectively Use TROs to Save Their Home from Foreclosure

20 Monday Jan 2014

Posted by BNG in Appeal, Federal Court, Foreclosure Defense, Judicial States, Litigation Strategies, Non-Judicial States, Pleadings, Pro Se Litigation, Trial Strategies, Your Legal Rights

≈ 1 Comment

How hard it is to fight a foreclosure depends to a great extent on where you live. If your state requires the foreclosing party to sue you (this is called judicial foreclosure), then it’s easier (and less expensive) to jump into the existing lawsuit. If, in your state, foreclosures proceed without court supervision (nonjudicial foreclosure), then you’ll have to bring your own lawsuit—a more worky and costly process.

Because nonjudicial foreclosures proceed outside of court, you’ll have to file a lawsuit to get a judge’s attention. And you’ll have the burden of proof because you want the judge to stop a proceeding—the foreclosure—that is already authorized by the mortgage.

Fightforeclosure will provide extremely helpful guidance if you choose to do this yourself, or you may hire a lawyer if you wish at a more costly price. Unfortunately, litigation in which an attorney’s services are used is always expensive when you have the burden of proof. So unless the lawyer thinks you have a very good case, you may not want to bother with a lawsuit. If the only basis for your challenge is that the foreclosing party made a technical procedural violation, you’ll probably gain only a few weeks of delay even if you win, but if you follow the well crafted causes of auction in fight Foreclosure defense package, you have a better chance of stopping foreclosure in its tracks.

To get your day in court to challenge a nonjudicial fore­closure, you must sue the lender and the foreclosing agent (typically, the trustee). In the lawsuit, you ask the court to enjoin (stop) the foreclosure proceedings until a judge can hear your reasons as to why the foreclosure shouldn’t proceed.

In this kind of lawsuit, you typically ask the court for three things, in this order:

  • a temporary restraining order
  • a preliminary injunction, and
  • a permanent injunction.

Your application for a temporary restraining order (TRO) must convince the judge that you will suffer “irreparable injury” if the judge doesn’t stop the foreclosure immediately. Because you will lose your home if the foreclosure is allowed to proceed, most courts accept that a foreclosure causes irreparable injury.

TROs are typically granted without a formal notice or hearing, which means the foreclosing party may have only a day or two of notice in which to prepare a response. If no response is filed, the judge may well grant the TRO, but require you to post a bond to protect the foreclosing party from economic harm in case you lose. A bond can be costly, assuming you can get one at all. You might be able to get the bond requirement waived if your income is low enough.

Getting the Bond Requirement Waived

The court may grant a waiver if:

* the delay required by the lawsuit will not cause unreason­able harm to the lender

* the validity of your mortgage is in question (for example, the deed was not properly acknowledged or recorded), or

* the lender’s interest in pushing ahead with the foreclosure can be protected by some other method, such are requiring you to make reasonable monthly payments during the course of the lawsuit.

The TRO will typically last until the date set for a hearing on whether the court should issue a preliminary injunction—which would stop the foreclosure pending a full trial on the matter. A hearing on the preliminary injunction is typically held between ten days and two weeks after the TRO is issued.

At the preliminary injunction hearing, the court will review each party’s paperwork—essentially the same paperwork submitted in a judicial foreclosure hearing, described earlier. At this hearing, the court must decide whether or not:

* you are likely to prevail at a trial, and

* the injury that you would suffer from the foreclosure outweighs the injury that the foreclosing party is suffering by not getting paid (called balancing the equities).

If the judge decides these issues in favor of the foreclosing party, the TRO will end, and your lawsuit will be dismissed.

But if the judge decides these issues in your favor, then the judge will issue a preliminary injunction. The preliminary injunction may order the foreclosing party to take corrective action—for example, by issuing a new pay-off statement and giving you a chance to reinstate the mortgage. Or it may simply keep the TRO in effect.

Because it often takes a year or two to bring a case to trial on a permanent injunction, getting a preliminary injunction is pretty much equivalent to a victory for you. Typically, the foreclosing party will either attempt to reach a settlement with you, drop the current foreclosure and begin from scratch, or meet any conditions laid down by the court and then go back into court asking that the injunction be lifted.

The burden is on you to prove that the foreclosing party didn’t comply with state laws or the terms of the deed of trust. You meet this burden with the documents you file—typically, declarations or affidavits from you and various witnesses that establish the facts you believe entitle you to stop the foreclosure. For example, if you contest the accuracy or legality of the fees the foreclosing party required you to pay to reinstate the mortgage, you would attach a sworn statement to your application for a TRO or preliminary injunction, setting out the facts as you know them.

If the foreclosing party produces documents that contradict yours, then you will need to convince the judge at the pre­liminary injunction stage that you deserve to have the fore­closure put on hold until you can produce your full case at trial. Because most preliminary injunction hearings don’t involve live witnesses, your paperwork may have to carry the day.

Consider Recording a Lis Pendens

Instead of seeking a TRO or preliminary injunction to delay the fore­closure sale until you can have a hearing, consider recording a “lis pendens” and filing a regular civil complaint attacking the foreclosure. A lis pendens is a simple document providing notice to the world that title to the property is a subject of litigation. As long as it is on record, any sale of the property can be undone if your lawsuit succeeds, because the buyer had notice of the controversy. Also, no title company will insure title to property subject to a lis pendens.

Due Process Suffers in Nonjudicial Foreclosures

When attempting to foreclose on your house, the lender must comply not just with your state’s laws and the terms of your deed of trust. It must also comply with the due process requirements of the United States Constitution.

In the foreclosure context, this means:

* You must receive adequate notice of the proceedings that may cause you to lose your house;

* You must have an opportunity to question the legality of the foreclosure proceedings before a neutral magistrate.

By agreeing to a nonjudicial foreclosure (as a practical matter, you have no choice) when you get a loan, you give up a fundamental due process right: the right to an evaluation of the foreclosure’s legality by a neutral magistrate before a foreclosure sale. To challenge a nonjudicial foreclosure in court and come out successful, you almost certainly will needs a well crafted package like Fightforeclosure.net package. Because people facing fore­closure are almost always strapped for cash, lawyers are often unaffordable. For that reason, for many people, the ability to file an action in court challenging a foreclosure is only theoretical. Is the entire nonjudicial foreclosure scheme even constitutional? I don’t think it is, but the courts say otherwise.

If you find yourself in an unfortunate situation of losing or about to your home to wrongful fraudulent foreclosure, and need a complete package  that will help you challenge these fraudsters and save your home from foreclosure visit: http://www.fightforeclosure.net

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What Homeowners Must Know About Appealability and Reviewability of Court Orders and Judgments

16 Thursday Jan 2014

Posted by BNG in Appeal, Case Laws, Case Study, Federal Court, Foreclosure Defense, Judicial States, Legal Research, Litigation Strategies, Non-Judicial States, Pro Se Litigation, State Court, Your Legal Rights

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This Post is to guide Homeowners in deciding whether to appeal their cases to the higher courts upon judgment or order.
A. Definitions

The concepts of appealability and reviewability are constitutional limitations on the Court’s power to hear cases. More precisely, appealability rules act to limit the kinds of cases which may be heard by the Court of Appeals. Reviewability rules, on the other hand, limit the issues which the Court may determine once the case is before the Court. Article VI, § 3(b) of the State Constitution prescribes what kinds of orders are appealable to the Court, and article VI, § 3(a) states that in most cases “the jurisdiction of the Court of Appeals shall be limited to the review of questions of law.”

B. Appealability

In addition to the jurisdictional requirements discussed above for appeals as of right and motions for leave to appeal, certain other appealability requirements must be met.

1. Appropriate Court

Action must originate in an appropriate court. For example, the Court lacks jurisdiction to entertain a motion for leave to appeal from an order of the Appellate Division where the appeal to that court was from a judgment or order entered in an appeal from a third court (Matter of Thenebe v Ansonia Assocs., 89 NY2d 858). This jurisdictional problem will arise when an action originates in a court other than Supreme Court, County Court, Surrogate’s Court, Family Court, Court of Claims or an administrative agency or an arbitration. The motion will be dismissed regardless of whether the Appellate Division order is final.

Note: The Court does not have jurisdiction to entertain a motion for leave to appeal from a determination of a court other than the Appellate Division, except in the circumstances specified in CPLR 5602(a)(1)(ii). Regarding appeals as of right, see CPLR 5601.

2. Aggrievement

a. CPLR 5511 states that only an aggrieved party may appeal (see, Hecht v City of New York, 60 NY2d 57, 61). A party may appeal if the order appealed from does not grant complete relief to it. A party which is granted complete relief but is dissatisfied with the court’s reasoning is not aggrieved within the meaning of CPLR 5511 (see, Matter of Sun Co. v City of Syracuse Indus. Dev. Agency, 86 NY2d 776; Parochial Bus Sys. v Board of Educ., 60 NY2d 539, 545).

b. No appeal lies from an Appellate Division order dismissing an appeal from a determination entered upon a default judgment (CPLR 5511; Matter of Lizette Patricia C., 98 NY2d 688).

c. Where the Appellate Division reverses a trial court’s judgment and orders a new trial limited to the issue of damages unless plaintiff stipulates to a reduction of damages, and plaintiff so stipulates, plaintiff is not aggrieved by the Appellate Division order (see, Whitfield v City of New York, 90 NY2d 777, 780 n *; see also, Smith v Hooker Chem. & Plastics Corp., cross mot for lv dismissed 69 NY2d 1029). Similarly, where the Appellate Division reverses and grants a new trial on the issue of damages unless defendant stipulates to an increase in damages and defendant stipulates, defendant’s attempt to appeal to the Court and to argue liability issues will be dismissed for lack of aggrievement (see, Whitfield, supra; see also, Sharrow v Dick Corp., mot to dismiss appeal granted 84 NY2d 976). Note that a party who, as a result of a conditional order, stipulates at the trial or appellate court to a different amount of damages in lieu of a new trial on a cause of action forgoes review of other issues raised by that order, including those pertaining to any other cause of action and, therefore, is not a party aggrieved (see, Batavia Turf Farms v County of Genesee, lv dismissed 91 NY2d 906). Only the non-stipulating party may appeal or move for leave to appeal (Whitfield, supra).

3. Finality — covered in detail in Section VI of this outline.

4. Miscellaneous Appealability Problems

a. Dual Review — Where the same party both appeals to the Appellate Division and appeals to the Court of Appeals, the appeal to the Court will be conditionally dismissed. Where the same party both appeals to the Appellate Division and moves for leave to appeal to the Court of Appeals, the motion will be dismissed outright. Dual review is generally not permitted (Parker v Rogerson, 35 NY2d 751, 753; see also, CBS Inc. v Ziff Davis Pub., lv dismissed 73 NY2d 807). However, where different parties pursue different avenues of appeal or motion before the Court will be permitted to continue (Defler Corp. v Kleeman, 18 NY2d 797).

b. Appealable paper — An appeal will be dismissed where the improper paper is sought to be appealed.

i. No order or judgment — Where appellant/movant seeks to appeal from something other than an order or judgment, the appeal/motion will be dismissed (Matter of Sims v Coughlin, appeal dismissed 86 NY2d 776 [decision]; Matter of Abdurrahman v Berry, lv dismissed 73 NY2d 806 [letter]).

ii. Subsequent Supreme Court order or judgment — CPLR 5611 reads in part “If the Appellate Division disposes of all the issues in the action its order shall be considered a final one, and a subsequent appeal may be taken only from that order and not from any judgment or order entered pursuant to it” (see, American Acquisition Co. v Kodak Electronic Printing Sys., 87 NY2d 1049).

iii. Order of individual Appellate Division Justice — No appeal lies from an order of an individual Justice of the Appellate Division (People ex rel. Mahler v Jablonsky, appeal dismissed 82 NY2d 919).

iv. The finality of an Appellate Division order dismissing an appeal to that court is determined by an examination of the finality of the underlying order (Langeloth Found. v Dickerson Pond Assocs., lv dismissed 74 NY2d 841).

v. No civil motion for leave to appeal or appeal as of right lies directly from the order of the Appellate Term of Supreme Court (Williamson v Housing Preservation and Dev. of City of New York, lv dismissed 82 NY2d 919).

c. Dismissal of Prior Appeal for Failure To Prosecute — A prior dismissal of an appeal for failure to prosecute is a determination on the merits and acts as a bar to a subsequent appeal raising the issues that could have been raised on the prior appeal (see, Bray v Cox, 38 NY2d 350). Thus, the subsequent motion/appeal may be dismissed (see, id.; compare Rubeo v National Grange Mut. Ins. Co., 93 NY2d 750; Faricelli v TSS Seedman’s, 94 NY2d 772 [Appellate Division has discretion to entertain appeal notwithstanding dismissal of prior appeal for failure to prosecute]).

d. Criminal Appeals — Appeals in criminal cases must be taken pursuant to the Criminal Procedure Law, not CPLR 5601 or 5602 (Matter of Newsday, Inc. 3 NY3d 651 [newspaper’s motion to intervene and obtain access to record in criminal case]; People v Blake, appeal dismissed 73 NY2d 985 [CPL 450.15, 460.15 application]; People v Dare, appeal dismissed 74 NY2d 707 [application for writ of error coram nobis]).

e. Corporation Appearance — CPLR 321(a) dictates that a motion or appeal by a corporate party must be filed by an attorney.

f. Mootness — Where the issues presented are no longer determinative of a live controversy, the Court will not entertain an appeal or motion for leave to appeal. The Court cannot entertain the motion or appeal because it cannot give advisory opinions (see, Matter of Hearst Corp. v Clyne, 50 NY2d 707, 713-714). However, the Court may entertain an appeal or motion when each of the three prongs of the mootness exception is satisfied: “(1) a likelihood of repetition * * *; (2) a phenomenon typically evading review; and (3) a showing of significant or important questions not previously passed on, i.e. substantial and novel issues” (id. at 714-715).

C. Reviewability

Once it is determined that an order is appealable, a litigant must consider which issues and orders that arose in the litigation are reviewable by the Court of Appeals.

1. Preservation — Issues Reviewable

a. The Court of Appeals’ power to review lower court rulings made on motions, applications and points of evidence is, in part, limited by statutes and case law requiring that appropriate objections be registered below as a prerequisite to appellate review (see, CPLR 4017, 4110-b and 5501[a][3] and [4]). The Court will, on its own, determine whether an issue has properly been preserved below, whether or not the parties raise the question of preservation (see, Halloran v Virginia Chems., 41 NY2d 386, 393). Counsel bears the responsibility of showing the Court where each issue raised has been preserved in the record.

b. Differences in Appellate Division and Court of Appeals review

The Appellate Division may reach questions of trial error, even if unpreserved, in an exercise of its “interest of justice” jurisdiction (see, Martin v City of Cohoes, 37 NY2d 162, rearg denied 37 NY2d 817, on remand 50 AD2d 1035, appeal dismissed 39 NY2d 740, lv denied 39 NY2d 910). The Court of Appeals, on the other hand, generally may only review questions of law and, therefore, may not review unpreserved error even if the Appellate Division has chosen to do so (see, Brown v City of New York, 60 NY2d 893, 894).

c. Preservation of legal issues and theories

i. As a general matter, appellate courts are reluctant to review legal arguments raised for the first time on appeal. Several policy reasons underlie this rule, such as avoiding unfairness to the other party, giving deference to the lower courts and encouraging the proper administration of justice by demanding an end to litigation and requiring the parties and trial courts to focus the issues before they reach the Court of Appeals (Bingham v New York City Trans. Auth., 99 NY2d 355, 359 [2003]).

Under appropriate circumstances, however, the Court of Appeals may entertain new legal arguments and theories raised on appeal. Those very limited circumstances include: (1) new arguments based on a change in statutory law while the appeal is pending (see, Post v 120 East End Ave. Corp., 62 NY2d 19, 28-29); (2) where the new argument could not have been obviated or cured by factual showings or legal countersteps had the arguments been tendered below (People ex rel. Roides v Smith, 67 NY2d 899, 901); (3) questions of pure statutory interpretation (Matter of Richardson v Fiedler Roofing, 67 NY2d 246, 250). These “exceptions” are narrowly construed.

ii. The general rule requires that constitutional questions be raised at the first available opportunity as a prerequisite to review in the Court of Appeals (see, e.g., Matter of Barbara C., 64 NY2d 866, 868). There is some indication that the Court may make an exception to this doctrine and examine a constitutional issue raised for the first time in the Court of Appeals if the issue implicates grave public policy concerns (see, Park of Edgewater v Joy, 50 NY2d 946, 949, citing Massachusetts Natl. Bank v Shinn, 163 NY 360, 363).

d. Preservation in the administrative agency context

The Court’s reluctance to review new legal arguments is equally applicable in the administrative agency context for policy reasons similar to those discussed above. Thus, arguments which were not raised by a party at the administrative level are considered unpreserved and not reviewable by the Court of Appeals, subject to very limited exceptions (see, Matter of Crowley v O’Keefe, mot to dismiss appeal granted 74 NY2d 780; Matter of Samuels v Kelly, lv denied 73 NY2d 707).

2. CPLR 5501(a) — Review of Prior Nonfinal Orders and Determinations

a. CPLR 5501(a) provides that an appeal from a final judgment brings up for review, among other things:

i. any nonfinal judgment or order which necessarily affects the final judgment, including any which was adverse to the respondent on appeal from the final judgment and which, if reversed, would entitle the respondent to prevail in whole or in part on that appeal (CPLR 5501[a][1]),

ii. any order denying a new trial or hearing which was not previously reviewed by the court to which the appeal was taken (CPLR 5501[a][2]), and

iii. any ruling to which the appellant objected or had no opportunity to object or which was a refusal or failure to act as requested by the appellant, any charge to the jury, or failure to charge as requested by the appellant, to which the appellant objected (CPLR 5501[a][3]).

b. Note that CPLR 5501(a)(1), which applies to prior nonfinal orders and judgments, contains the “necessarily affects” requirement. CPLR 5501(a)(3), which applies to trial rulings, however, does not.

c. For an in-depth discussion of the “necessarily affects” requirement, see Section VII of this outline.

3. Scope of Review

Once it is determined which orders, determinations, and issues are reviewable, the scope of the Court’s review must be considered.

a. Limited to questions of law

As noted earlier, the State Constitution limits the Court’s review powers to questions of law. Questions of fact are not reviewable except in:

i. death penalty cases (CPL 470.30[1]);

ii. Commission on Judicial Conduct matters (see, e.g., Matter of Edwards, 67 NY2d 153);

iii. cases where the Appellate Division reverses or modifies and finds new facts, in which case the Court’s review power is limited as discussed further below (CPLR 5501[b]); and

iv. defamation cases involving a public figure defendant — where the issue concerns whether plaintiff has proven the essential element of actual malice, the Court has a constitutional duty to review the evidence and to “exercise independent judgment to determine whether the record establishes actual malice with convincing clarity” (Prozeralik v Capital Cities Communications, 82 NY2d 466, 474-475, quoting Harte-Hanks Communications v Connaughton, 491 US 657, 659).

b. Questions that are never reviewable

i. An Appellate Division determination whether the trial judge correctly decided a CPLR 4404(a) motion to set aside the verdict as “contrary to the weight of the evidence” is not reviewable (Levo v Greenwald, 66 NY2d 962; Gutin v Frank Mascali & Sons, Inc., 11 NY2d 97, 98-99 [emphasis added]).

However, where a jury verdict has been set aside on the ground that, as a matter of law, the verdict is not supported by sufficient evidence, that determination is reviewable. The relevant inquiry is whether there is any “valid line of reasoning and permissible inferences which could possibly lead rational [people] to the conclusion reached by the jury on the basis of the evidence presented at trial” (Cohen v Hallmark Cards, 45 NY2d 493, 499). Where it is not clear from the Appellate Division writing whether the Appellate Division has set aside a verdict on sufficiency of evidence or weight of evidence grounds in a jury tried case, examine the court’s corrective action. New trial ordered — weight; dismissal of complaint — sufficiency (see, id. at 498). The foregoing analysis cannot be used in bench trial cases because the Appellate Division can render judgment for the appealing party as a matter of fact without the need for a new trial. When, in a jury case, the Appellate Division reverses a judgment entered on a plaintiff’s verdict, on both sufficiency and weight of the evidence grounds, the Court can review whether the legal sufficiency ruling was correct. If the Court disagrees with the Appellate Division and concludes that the verdict is supported by legally sufficient evidence, the Court cannot reinstate the judgment entered on the verdict; instead, it must order a new trial because it cannot disturb the Appellate Division’s weight of evidence determination (Sage v Fairchild-Swearingen, 70 NY2d 579, 588).

ii. A determination of excessiveness (or inadequacy) of the jury’s verdict (Rios v Smith, 97 NY2d 647, 654; Woska v Murray, 57 NY2d 928; Zipprich v Smith Trucking Co., 2 NY2d 177, 188).

iii. An Appellate Division determination to reverse a judgment in a civil action on the basis of unpreserved legal error (Brown v City of New York, 60 NY2d 893). The Court of Appeals has no power to review either the unpreserved error or the Appellate Division’s exercise of discretion in reaching the issue (see, Elezaj v Carlin Constr. Co., 89 NY2d 992, 994).

c. Limited Review

i. Findings of fact that are affirmed by the Appellate Division are only reviewable to determine if there is evidence in the record to support them (Cannon v Putnam, 76 NY2d 644, 651; Morgan Servs. v Lavan Corp., 59 NY2d 796, 797).

ii. In situations where the Appellate Division reverses or modifies and expressly or impliedly finds new facts, the Court of Appeals can determine which of the findings more nearly comports with the weight of the evidence (CPLR 5501[b]; Matter of Y.K., 87 NY2d 430, 432; Loughry v Lincoln First Bank, N.A., 67 NY2d 369, 380).

iii. Provided the lower courts had the power to exercise discretion (Brady v Ottaway Newspapers, 63 NY2d 1031), the Court of Appeals will not interfere with the exercise of that discretion absent an abuse (Herrick v Second Cuthouse, 64 NY2d 692). However, an issue of law will be presented where the Appellate Division in exercising its discretion expressly fails to take into account all the various factors that are properly entitled to consideration (Varkonyi v Varig, 22 NY2d 333, 337). In such cases, the Court can set out the proper factors and, if judgment cannot be rendered as a matter of law, remit the case to the Appellate Division to exercise its own discretion on the basis of all the relevant factors (id. at 338).

Consider these facts: The federal district court grants the defendant’s motion to dismiss and states that the court may amend its order with a more specific statement of grounds for its decision.
However, the court never amends its order. Is the order appealable?
No, answered the 9th U.S. Circuit Court of Appeals in National Distribution Agency v. Nationwide Mutual Insurance Company, 117 F.3d 432 (9th Cir. 1997). The court said: “A district court ruling is not final if the court reserves the option of further modifying its ruling.” Therefore, the plaintiff’s appeal is dismissed.

This is a specific application of the general rule that to invoke federal-appellate jurisdiction, the appellant must timely appeal from an appealable judgment. Price v. Seydel, 961 F.2d 1470, 1473 (9th Cir. 1992). Stating that rule is simple. Applying it, however, presents formidable challenges for the appellate practitioner. Virtually every aspect of the rule is subject to interpretation and debate, and there is little leeway for error. Had the plaintiff in National not appealed, and the order later was deemed a final judgment, the plaintiff’s opportunity for appellate review would have been lost.

In determining whether a judgment or an order is appealable, the practitioner should consider
the following issues:

Is the challenged judgment or order appealable by statute?
Federal appeals courts (other than the Federal Circuit, which has unique jurisdiction) have jurisdiction of appeals from “all final decisions of the district courts.” 28 U.S.C. Section 1291. In addition, they have
jurisdiction over appeals from specified interlocutory orders in injunction, receivership and admiralty cases. 28 U.S.C. Section 1292(a). Appellate courts also have discretion to hear appeals from interlocutory orders when the district court determines, in its discretion, that the order involves a controlling question of law and immediate appeal may materially advance the ultimate termination of the litigation. 28 U.S.C. Section 1292(b).

When a case involves more than one claim or multiple parties, the district court also has the option of entering judgment on all or some of the claims or parties. That judgment is immediately appealable if the district court expressly determines there is no just reason for delay. Fed. R. Civ. P. 54(b).

If the appeal is from a judgment, is the judgment final?
For a judgment to be final — absent any of the exceptions noted above — it must end the litigation on the merits for all claims and all parties.
FirsTier Mortg. Co. v. Investors Mortg. Ins. Co., 498 U.S. 269, 273-74
(1991). For example, a judgment is not final if the court has yet to resolve a claim for prejudgment interest. Pace Communications Inc. v. Moonlight Design Inc., 31 F.3d 587, 591 (7th Cir. 1994). On the other hand, a judgment is final even though the court has not yet determined costs. Budinich v. Becton Dickinson & Co., 486 U.S. 196, 202 (1988).

Moreover, the court’s ruling itself is not an appealable final judgment. The clerk is supposed to enter judgment as a separate document. Fed. R. Civ. P. 58. The mere fact that the court added a seemingly final and dispositive phrase such as “judgment accordingly” to its findings of fact and conclusions of law does not make the order a final judgment.

Whether a ruling is final depends ultimately on its substance. Thus, a ruling entitled a “judgment” may not be final for purposes of appeal where further issues remain to be resolved. Zucker v. Maxicare Health Plans Inc., 14 F.3d 477, 483 (9th Cir. 1994). But a ruling entitled an
“order” may be a final judgment for purposes of appeal where there is no substantive issue left for the court to resolve. United States v. Lee, 786 F.2d 951, 955-56 (9th Cir. 1986).

Although the appeals courts will apply a common-sense interpretation to the finality requirement, Sutton v. Earles, 26 F.3d 903, 906 n.1 (9th Cir. 1994), the parties cannot stipulate to appellate jurisdiction where there is none, Dannenberg v. Software Toolworks Inc., 16 F.3d 1073, 1076-78 (9th Cir. 1994), nor can they create appellate jurisdiction by dismissing unresolved claims and reserving the option of litigating them at some future time, Cheng v. Commissioner, 878 F.2d 306, 310 (9th Cir. 1989)

The finality requirement has only rare exception, usually involving cases in the “‘twilight zone’ of finality.” Gillespie v. United States Steel Corp.
, 319 U.S. 148, 152-54 (1964). In extraordinary circumstances, a federal appeals court will consider an appeal from a seemingly nonappealable ruling where the ruling is “marginally final,” involves an issue of “national significance” and has been “fully briefed and argued.” Service Employees Int’l Union, Local 102 v. County of San Diego, 60 F.3d 1346, 1350 (9th Cir. 1995)

Is the appeal timely?
If notice of appeal is filed either too early or too late, and no
exception applies, the appeal is invalid and cannot be heard. Generally, the prescribed time within which to file notice of appeal is 30 days after entry of the judgment or other appealable order. If the United States or one of its officers or agencies is a party, the prescribed time is 60 days. Fed. R. App. P. 4(a)(1).

Time to appeal is extended to accommodate certain post-judgment proceedings that may affect the judgment. If any party timely files one of several specified post-judgment motions, including a motion for new trial or for judgment as a matter of law, the time for all parties to appeal begins to run from the entry of the order disposing of the post-trial motion. Fed. R. App. P. 4(a)(4). The district court may deem a motion for attorney fees to be in the nature of a motion to amend the judgment and
thus extend the time for appeal. Fed. R. Civ. P. 38. If the post-judgment motion is not timely, the time to appeal is not extended. Cel-A-Pak v. California Agric. Labor Relations Bd., 680 F.2d 664, 666 (9th Cir. 1982).

An appeal filed while one of the specified post-judgment motions is pending is held until the motion is decided; then the appeal becomes effective. Leader Nat’l Ins. Co. v. Industrial Indem.
Ins. Co., 19 F.3d 444, 445 (9th Cir. 1994). When it becomes effective, that appeal still applies only to the original judgment; if the appellant intends to challenge the ruling on the postjudgment motion or any modifications to the judgment, the existing notice of appeal must be amended. Fed. R. App. P. 4(a)(4).

There is some leeway on either side of the prescribed time period for appeal. A notice of appeal is treated as filed on the date of entry, if it’s filed before entry of the appealable order or judgment but after the district court-announced decision. Fed. R. App. P. 4(a)(2). This is a relatively recent liberalization in federal appellate procedure. Previously, a premature appeal was invalid and a new notice of appeal had to be filed at the appropriate time. Schroeder v. McDonald, 55 F.3d 454, 458-60 (9th Cir. 1993). However, even under the present rule, a notice of appeal remains invalid if it’s filed before the court announces the decision that will ripen into an appealable judgment. Kennedy v. Applause Inc., 90 F.3d 1477, 1482 (9th Cir. 1996).

On a motion filed within 30 days after the filing deadline, and on a showing of excusable neglect or good cause, the district court may extend the time for filing a notice of appeal up to 30 days or 10
days from the order’s entry date, whichever occurs later. Fed. R. App. P. 4(a)(5).

The courts abide by strict standards for excusable neglect in failing to file a timely notice of appeal. Oregon v. Champion Int’l Corp., 680 F.2d 1300, 1301 (9th Cir. 1982). An extension to appeal will be granted only in “extraordinary circumstances.” National Industries Inc. v. Republic
Nat’l Life Ins. Co., 677 F.2d 1258, 1264 (9th Cir. 1982). One such circumstance is provided by express rule. The court may reopen the appeal time for 14 days if the aggrieved party files a motion within 180 days of the judgment’s entry or within seven days of receiving notice of the judgment’s entry, whichever is earlier – and if the district court finds that the party didn’t receive notice of the judgment’s entry within 21 days, and no party would be prejudiced. Fed. R. App. P. 4(a)(6)

Yet another wrinkle in the rules for timely filing of federal appeals is that the time begins to run only upon entry of judgment. Fuller v. M.G. Jewelry
, 950 F.2d 1437, 1441 n.4 (9th Cir. 1991). Nevertheless, absent objection, the court can consider an appeal from a judgment that has been
rendered but not entered. Allah v. Superior Court of California, 871 F.2d 887, 890 n.1 (9th Cir. 1989). The appellate court will not engage in the “pointless exercise of dismissing the appeal and waiting for the district court to enter a separate judgment.” Vernon v. Heckler , 811 F.2d 1274, 1276-77 (9th Cir. 1987).

As National demonstrates, despite potential loopholes in the rules of appealability, the practitioner cannot count on extraordinary exceptions or discretionary relief to salvage an unauthorized or untimely appeal. To ensure a timely and valid appeal in federal court, the practitioner must carefully monitor the district court’s actions, diligently follow the rules, and count the days precisely.

A fundamental rule of appellate law is that an appeal only lies from an order or judgment that is appealable. An appellate court does not have jurisdiction to hear the case unless there is an appealable order or judgment.
The following is an overview of appeal-able orders and judgments under California law. Note that judgments and orders issued in federal courts are subject to different rules.

Right to Appeal is Statutory
The right to appeal in California is wholly statutory.
Thus, no appeal may be taken unless there is a statute that expressly allows the appeal. Most of the appeal-able orders and judgments are listed in Code of Civil Procedure §904.1. Some orders are made
appealable by other statutes as well.

The most common type of appealable order is a judgment.
See Code Civ. Proc. §904.1(a)(1). Judgments are generally appealable, except for most interlocutory judgments, judgments of contempt
(they may be reviewed by writ), and judgments in limited civil cases
(appeal is to the superior court).

One Final Judgment Rule

Under the “one final judgment” rule, an appeal from a judgment
can only be from a single, final judgment in the action. The rule is codified in Code of Civil Procedure section 904.1(a), which authorizes an appeal “[f]rom a judgment, except … an interlocutory judgment.” The California Supreme Court has held that this means that the appeal must be “from a judgment that is not intermediate or nonfinal but is the one final
judgment.” Morehart v. County of Santa Barbara, 7 Cal.4th 725, 741 (1994). “Judgments that leave nothing to be decided between one or more parties and their adversaries, or that can be amended to encompass all controverted issues, have the finality required by section 904.1, subdivision (a).” Id. Conversely, a “judgment that disposes of fewer than all of the causes of action framed by the pleadings, however, is necessarily „interlocutory‟ … and not yet final, as to any parties be
tween whom another cause of action remains pending.” Id.

The reason for this rule is to avoid multiple appeals in the same case, which places a huge burden on the courts and the parties.
See id. at 741 n.9. Moreover, if the parties have to wait until a
final judgment is entered, “the trial court may completely obviate an appeal by altering the rulings from which an appeal would otherwise have been taken.” Id. It also gives the appellate court a more comprehensive record. Id

To determine if a judgment is final, courts look to the substance and effect, rather than the form or title. The judgment is considered
final when it ends the litigation between the parties on the merits of the case, and nothing is left to be done other than to enforce the judgment.
See San Joaquin County Dept. of Child Services v. Winn, 163 Cal.App.4th 296, 300 (2008). If the judgment contemplates any future judicial action
— other than simple enforcement of the judgment — essential to determining the rights or responsibilities of the parties, the judgment is not final.

Once a final judgment is entered, the appellate court may generally review any order or ruling made in the proceeding leading up to that final, appealable judgment. See Code Civ. Proc. §906.

Judgments Where There Are Multiple Parties

A judgment is immediately appealable if it terminates the litigation with respect to one or more parties. So, if a plaintiff sues several defendants, and the court dismisses the lawsuit against one of the defendants, the
judgment is final as to that defendant, and plaintiff may appeal the
judgment without waiting for the rest of the case to be resolved.
See Nguyen v. Calhoun, 105 Cal.App.4th 428, 437 (2003). Likewise, if there are multiple plaintiffs, and judgment is entered against some of the plaintiffs but not against others, the plaintiffs against whom judgment was entered may immediately appeal. See Panicov. Truck Ins. Exchange, 90 Cal.App.4th 1294, 1300-1301 (2001). With respect to defendants, there is an exception where the liability of one defendant is intertwined with and dependent on the liability of other defendants and their liability
has not yet been established. See Entertainment, Inc. v. Arthur J. Gallagher & Co., 125 Cal.App.4th 1022 (2005)(liability of insurance agency and insurance company in duty to defend and bad faith action were intertwined, and therefore appeal of dismissal of insurance agency was
premature)

Note that if you file an appeal with respect to one party, but there are claims against other parties remaining in the trial court, it might be prudent to ask the trial court to stay the action until the appeal has been decided.

Other Appealable Orders

Some other types of orders are made appealable by statute. For example, orders made after a final judgment are appealable. Code Civ. Proc. §904.1(a)(2). Other types of appealable orders listed in Code of Civil Procedure section 904.1 include: orders granting a motion to quash service of a summons or granting a motion to stay an action on the
grounds of an inconvenient forum; orders granting a new trial or denying a motion for judgment notwithstanding the verdict; orders granting, discharging or refusing to discharge an attachment; orders granting or dissolving an injunction; orders appointing a receiver; certain orders in partition actions; certain orders issued under the Family and Probate Code; orders directing the payment of sanctions over $5,000; an orders granting or denying a special motion to strike in anti-SLAPP cases.
Certain orders related to arbitration proceedings are also made appealable under Code of Civil Procedure section 1294

Non-Appealable Orders

Any judgment or order that is not expressly appealable by statute is non
– appealable. Many orders that fall into this category. Some of the more common types include: orders overruling a demurrer; orders sustaining a demurrer (an appeal lies from the judgment dismissing the complaint with prejudice); discovery orders; orders denying a motion for a new trial; orders granting a mistrial due to a hung jury; orders directing a verdict (an appeal lies from the judgment issued); orders granting or denying a motion for summary judgment (a judgment following the order granting summary judgment is appealable); tentative decisions; and statements of decision.

Keep in mind that it is the substance and effect, not the form, that governs whether an order is appealable. For example, if a court sustains a demurrer and in the same document dismisses the complaint with prejudice, then that document likely would be considered a final judgment.
But if the court sustains the demurrer without dismissing the complaint,
the order sustaining the demurrer is not appealable.
See City of Morgan Hill v. Bay Area Quality Management Dist., 118 Cal.App.4th 861, 867 n. 3 (2004).

Finally, remember that interlocutory orders may be reviewed after a final
judgment has been entered, so long as the appealing party has preserved his or her arguments on appeal by raising those arguments in the trial court.

Conclusion
Before filing an appeal, a litigant must ensure that the order or judgment he or she wishes to challenge is appealable, or risk dismissal of the appeal. Determining whether an order is appealable is also important
to identify when the time to appeal will expire.

Respondents should also evaluate whether the order being appealed is appealable, and if not, should immediately file a motion to dismiss the appeal. Taking these simple steps at the outset of an appeal can save a party significant time and money in the long run

If you find yourself in an unfortunate situation of losing or about to your home to wrongful fraudulent foreclosure, and need a complete package  that will help you challenge these fraudsters and save your home from foreclosure visit: http://www.fightforeclosure.net

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Foreclosure King David J. Stern Disbared By Florida Supreme Court

16 Thursday Jan 2014

Posted by BNG in Foreclosure Defense

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david-j-sternpibillwarner

The man who once ruled over Florida’s massive foreclosure mire was disbarred Tuesday by the Florida Supreme Court, officially ending a decades-long legal career tarnished by accusations of fraud and misconduct.

The ruling against David J. Stern, who built his Plantation-based law firm on repossessing homes, was expected as the 53-year-old did not appeal a referee’s October recommendation for disbarment.

Stern’s attorney, Jeff Tew, said he had no comment about the decision, which was made public Thursday.

The Supreme Court order gives Stern 30 days to close his practice. But his company, which once handled more than 200,000 foreclosure cases statewide, effectively shut down in 2011 after he lost most of his clients amid allegations of notary fraud, robo-signing and shoddy legal work.

Speaking during an October hearing where the Florida Bar pursued 17 complaints against him, Stern said he wasn’t to blame for the problems at his firm and characterized the findings as unintended mistakes.

His refusal to accept responsibility was noted by Palm Beach County Circuit Court Judge Nancy Perez, who acted as referee in the case and recommended disbarment.

“Mr. Stern has not expressed any remorse in these proceedings,” Perez wrote in her recommendation. “He has taken no responsibility.”

Perez also scolded Stern for blaming his attorneys and paralegals for the flaws in foreclosure filings.

“The incidents were not isolated, but rather a representation of the culture of the firm, as to the low level of competence and ethics,” Perez wrote in her 35-page report. “(Stern) is the lawyer. It was his firm. Mr. Stern is responsible.”

As Florida’s foreclosure crisis swelled, Stern, a former college soccer player, grew his firm by taking on mega-bank clients and federal mortgage backers Fannie Mae and Freddie Mac. His office, once 800 square feet, ballooned to seven floors with 1,500 employees, including 150 attorneys.

In 2010, Stern sold the non-legal, back operations of his enterprise for $58 million.

Stern is also required to pay $49,125 to the Florida Bar for its investigation. Realtor.com shows Stern listed his six-bedroom, 17,000-square-foot waterfront home in Fort Laudersale for sale at $32 million in June.

Foreclosure defense attorneys reacted with indifference to the disbarment news.

Mike Wasylik, a foreclosure defense attorney who testified in the Bar’s case against Stern, said “he got off light.”

“Who really cares? What does it really matter,” said St. Petersburg area foreclosure defense attorney Matt Weidner. “I just returned from court today on an old David J. Stern case. Courts all across this state are still filled with the garbage poured into them.”

If you find yourself in an unfortunate situation of losing or about to your home to wrongful fraudulent foreclosure, and need a complete package  that will help you challenge these fraudsters and save your home from foreclosure visit: http://www.fightforeclosure.net

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What Homeowners Must Know About Appealing Their Wrongful Foreclosures

16 Thursday Jan 2014

Posted by BNG in Appeal, Federal Court, Foreclosure Defense, Judicial States, Non-Judicial States, Pro Se Litigation, State Court, Your Legal Rights

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Appeal

Timely resort by an unsuccessful party in a lawsuit or administrative proceeding to an appropriate superior court empowered to review a final decision on the ground that it was based upon an erroneous application of law.

A person who initiates an appeal—the appellant, sometimes called the plaintiff in error, must file a notice of appeal, along with the necessary documents, to commence appellate review. The person against whom the appeal is brought, the appellee, then files a brief in response to the appellant’s allegations.

There are usually two stages of review in the federal court and in many state court systems: an appeal from a trial court to an intermediate appellate court and thereafter to the highest appellate court in the jurisdiction. Within the appellate rules of administrative procedure, there might be several levels of appeals from a determination made by an Administrative Agency. For example, an appeal of the decision of an administrative law judge may be heard by a reviewing body within the agency, and from that body, the appeal may go to a trial court, such as a federal district court. Thereafter, the appeal might travel the same route as an appeal taken from a judicial decision, going from an intermediate to a superior appellate court, or it might go directly to a superior appellate court for review, bypassing the intermediate stage. The rules of appellate procedure applicable to a particular court govern its review of cases.

Right to Appeal

There is no absolute right of appeal for all decisions rendered by a lower court or administrative agency. Federal and state constitutions and statutory provisions create appellate courts and prescribe the types of cases that are within their jurisdiction. An appeal may be granted as a matter of right, such as from a trial court to an intermediate appellate court or only at the discretion of a superior appellate court, for example, by a grant of certiorari by the Supreme Court. If the decision presented does not meet the statutory requirements for review, the appellate court is powerless to hear the appeal and review is denied.

The right to appeal a decision is limited to those parties to the proceeding who are aggrieved by the decision because it has a direct and adverse effect upon their persons or property. In addition, an actual case or controversy must exist at the time of review. Issues that have become moot while the appeal is pending and cases that have been settled during that time are not reviewable.

Final Decision

A final judgment or order must have been reached by the trial court in order for a case to be appeal-able. A judgment is considered final for purposes of appeal when it ends the action in the court in which it was brought and nothing more is to be decided. This rule is intended to prevent the piecemeal litigation of a lawsuit, to avoid delay resulting from Interlocutory appeals, and to give the trial court the opportunity to render a decision in the case to the satisfaction of both parties, thereby obviating the need for appeal. The consideration of incidental matters, such as the computation of interest, attorneys’ fees, or court costs, does not prevent a judgment or order from being appealed.

Grounds

Error is the basis for review of a final decision rendered by a court or administrative agency. Error is called to the attention of a court through the use of objections, protests made during the course of a proceeding that an action taken by the opposing side in a controversy is unfair or illegal. Decisions rendered in favor of one party at trial level are presumed by an appellate court to be correct unless objections have been made to the issues in question during the trial. Failure to do so will preclude their review on appeal. An objection must be made as promptly and specifically as possible for each act to which it is directed so that the court may make an intelligent decision regarding its merits. The trial judge rules on the objection, and the decision is included in the trial record. If the attorney for either party disagrees with the ruling, he or she may take an exception, an objection taken to a decision of a court on a Matter of Law, which is noted in the trial record to be preserved for purposes of appeal. Appellate jurisdiction is limited only to a review of actions taken by an inferior court. No new objections can be raised before an appellate court for its consideration unless exceptional circumstances exist to justify the appellate court raising the issues sua sponte, on its own motion. Exceptional circumstances mean the presence at trial of plain error, a mistake in the proceedings that substantially affects the rights of the party against whom the decision has been made and undermines the fairness and integrity of the judicial system, causing a miscarriage of justice.

Time of Appeal

Appeals must be made within the time prescribed by statute or by the governing rules of the appellate court. Such statutes begin to run only after a final decision has been made. The timely filing of the notice of appeal with the clerk of the appellate court and the appellee completes, or perfects, the procedure. If the appeal is not taken and perfected within the time set by statute, the right to appeal is foreclosed. Extensions of time for the filing of an appeal may be granted, however, if extenuating circumstances exist, such as if either party is adjudicated incompetent or dies.

Notice of Appeal

A notice of appeal—a written document filed by the appellant with the court and a copy of which is sent to the appellee—is the initial step in the appeals process. It informs the court and the party in whose favor a judgment or order has been made that the unsuccessful party seeks a review of the case. Failure to file a notice of appeal according to the statutory requirements will preclude appeal.

Bonds

An appeal bond, a promise to pay a sum of money, must often be posted by an appellant to secure the appellee against the costs of the appeal, if the appellee is successful and the appellant fails to pay. Its amount is determined by the court itself or by statute. The imposition of such a bond discourages frivolous appeals. If successive appeals are taken from an intermediate appellate court to a superior one, a new bond is usually required.

Record on Appeal

The function of the appellate court is limited to a review of the trial record sent up from the lower court and the briefs filed by the appellant and appellee. Amicus Curiae briefs, if permitted by the appellate court, also become part of the record on appeal. The trial record, sometimes called the record proper, must show the pleadings that initiated the case, the complete transcript (in cases of jury trial) of lower court proceedings, the verdict, and the entry of the final judgment or order. The appellant must clearly demonstrate that the grounds for review had been raised and unsuccessfully decided upon at the trial level and, therefore, prejudicial error exists to warrant the reversal of the decision of the lower court.

In some jurisdictions, a bill of exceptions—a written statement of the objections made by a party to the ruling, decision, charge, or opinion of the trial judge—must be submitted to the appellate court to provide a history of the trial proceedings. It should not include matters that belong in the record proper but, instead, should state those points concerning questions of law raised by the exceptions taken during the trial. The appellant’s attorney prepares the bill and presents it to the trial judge for settlement, an agreement between the trial judge and the appellant that the bill contains a truthful account of the events of the trial. If there is disagreement, the judge returns the bill to the appellant with an explanation. The appellee must be given notice of the time and place of the settlement of the bill of exceptions in order to object to or approve its contents. The settled bill of exceptions becomes part of the trial transcript, which is part of the record on appeal. The appellant must submit a complete unabridged transcript of the trial that is prepared by the clerk of the trial court.

The entire trial record is printed and filed with the appellate court, and a copy is also sent to the appellee.

Assignment of Errors

A statement by the appellant of the errors alleged to have been committed in the lower court is an assignment of errors, a type of appellate Pleading used to point out to the appellate court the grounds for review. It controls the scope of an appeal because if a ground for review is not contained in it, it will not ordinarily be considered by the court. The assignment of errors is usually part of the notice of appeal, the bill of exceptions, the transcript of the record, or the brief, although in some jurisdictions, it is a separate document.

Appellate Brief

The appellant and appellee must file individual briefs to aid the appellate court in its consideration of the issues presented. Failure to do so results in a dismissal of the appeal. The facts of the case, the grounds for review, and the arguments relating to those questions must be concisely stated. Any statements referring to the trial record must be supported by an appropriate reference to it.

The appellant’s brief must specifically discuss the alleged errors that entitle the appellant to a reversal and discuss why each ruling of the lower court was wrong, citing authority, such as a case in which a similar point of law has been decided or a statute that applies to the particular point in issue. Disrespectful or abusive language directed against the lower court, the appellate court, the parties, witnesses, or opposing counsel cannot be used. If it is, it will be stricken from the brief, and the costs of the brief that might have been awarded are disallowed.

Review

Appellate courts have jurisdiction to decide only issues actually before them on appeal and nothing else. They cannot render opinions on controversies or declare principles of law that have no practical effect in settling the rights of the litigants.

Only conclusions of law, not findings of fact made by a lower court, are reviewable.

Harmless Error The appellate court must decide whether the errors alleged to have been made by the trial court are harmless or prejudicial. An error that substantially injures the rights of one party is called a prejudicial or reversible error and warrants the reversal of the final judgment or order. However, an error that is technical or minimally affects the rights of the parties or the outcome of the lawsuit is considered a Harmless Error, insufficient to require a reversal or modification of the decision of the lower court.

Hearing

The clerk of the appellate court schedules on the court calendar the date of the hearing on which each side may present an oral argument. Oral arguments, usually ten to fifteen minutes for each side, help the court understand the issues argued in the brief and persuade the court to rule in favor of the arguing party. During the arguments of appellant and appellee, it is not unusual for the appellate judge to interrupt with questions on particular issues or points of law.

The appellant’s argument briefly discusses the facts on which the Cause of Action is based and traces the history of the case through the lower courts. It includes the legal issues raised by the exceptions taken to the allegedly erroneous rulings of the trial judge. Thereafter, the appellee’s counsel presents arguments in favor of affirming the original decision.

Determination

An appellate court has broad powers over the scope of its decision and the relief to be granted. After reviewing the controlling issues in an action, it may affirm the decision of the inferior tribunal, modify it, reverse it, or remand the case for a new trial in the lower court pursuant to its order.When a decision is affirmed, the appellate court accepts the decision of the lower court and rejects the appellant’s contention that it was erroneously made. The modification of a decision by an appellate court means that, while it accepts part of the trial court’s decision, the appellant was correct that the decision was partly erroneous. The trial court’s decision is then modified accordingly.

A reversal of a decision means that the appellate court agrees with the appellant that the decision was erroneously made. The party who lost the case at the trial level becomes the winning party in appellate court.

In some cases, a decision might be reversed but the lawsuit is still unresolved. The appellate court then orders the reversal with the direction that the case be remanded to a lower court for the determination of the issues that remain unsettled.

If a judgment or order is reversed in an intermediate appellate court, the losing party may file an appeal with a superior appellate court for relief, and the appellate process begins again. The decision rendered by a superior appellate court cannot ordinarily be reviewed. In state cases involving issues based on federal statutes or the Constitution, however, an appeal may be brought in the federal court system on those questions that are within its jurisdiction.

If you find yourself in an unfortunate situation of losing or about to your home to wrongful fraudulent foreclosure, and need a complete package  that will help you challenge these fraudsters and save your home from foreclosure visit: http://www.fightforeclosure.net

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10 Banks Agree to Pay $8.5B for Foreclosure Abuse

10 Friday Jan 2014

Posted by BNG in Banks and Lenders, Fed, Foreclosure Crisis, Fraud

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Ten major banks agreed Monday to pay $8.5 billion to settle federal complaints that they wrongfully foreclosed on homeowners who should have been allowed to stay in their homes.

The banks, which include JPMorgan Chase (JPM), Bank of America (BAC) and Wells Fargo (WFC), will pay billions to homeowners to end a review process of foreclosure files that was required under a 2011 enforcement action. The review was ordered because banks mishandled people’s paperwork and skipped required steps in the foreclosure process.

The settlement was announced jointly by the Office of the Comptroller of the Currency and the Federal Reserve.

Separately, Bank of America agreed Monday to pay $11.6 billion to government-backed mortgage financier Fannie Mae to settle claims related to mortgages that soured during the housing crash.

The agreements are the banks’ latest step toward eliminating hundreds of billions of dollars in potential liabilities related to the housing crisis that crested in 2008. When they release fourth-quarter earnings later this month, the banks hope to reassure investors that they are making progress toward addressing those so-called legacy claims.

But advocates say the foreclosure deal allows banks to escape responsibility for damages that might have cost them much more. Regulators are settling at too low a price and possibly at the expense of the consumer, they say.

“This was supposed to be about compensating homeowners for the harm they suffered,” said Diane Thompson, a lawyer with the National Consumer Law Center. The payout guidelines already allowed wronged homeowners less compensation than the actual damages to them, she said.

Under the settlement, people who were wrongfully foreclosed on could receive from $1,000 up to $125,000. Failing to offer someone a loan modification would be considered a lighter offense; unfairly seizing and selling a person’s home would entitle that person to the biggest payment, according to guidelines released last summer by the OCC.

The agreement covers up to 3.8 million people who were in foreclosure in 2009 and 2010. All will receive some amount of compensation. That’s an average of $2,237 per homeowner, although the payouts are expected to vary widely.

About $3.3 billion would be direct payments to borrowers, regulators said. Another $5.2 billion would pay for other assistance including loan modifications.

The companies involved in the settlement also include Citigroup (C), MetLife Bank (MET), PNC Financial Services (PNC), Sovereign, SunTrust (STI), U.S. Bank (USB) and Aurora. The 2011 action also included GMAC Mortgage, HSBC (HBC) and EMC (EMC).

The deal “represents a significant change in direction” from the original, 2011 agreements, Comptroller of the Currency Thomas Curry said in a statement.

Banks and consumer advocates had complained that the loan-by-loan reviews required under the 2011 order were time consuming and costly without reaching many homeowners. Banks were paying large sums to consultants who were reviewing the files. Some questioned the independence of those consultants, who often ruled against homeowners.

Curry said the new deal meets the original objectives “by ensuring that consumers are the ones who will benefit, and that they will benefit more quickly and in a more direct manner.”

“It has become clear that carrying the process through to its conclusion would divert money away from the impacted homeowners and also needlessly delay the dispensation of compensation to affected borrowers,” Curry said.

Thompson agreed that the earlier review process was deeply flawed and said the move toward direct payments is a positive development. But she said the deal will only work if it includes strong oversight and transparency provisions.

“It’s another get out of jail free card for the banks,” said Thompson. “It caps their liability at a total number that’s less than they thought they were going to pay going in.”

Citigroup said in a statement that the bank is “pleased to have the matter resolved” and believes the agreement “will provide benefits for homeowners.” Citi expects to record a charge of $305 million in the fourth quarter of 2012 to cover its cash payment under the settlement. The bank expects that existing reserves will cover its $500 million share of the non-cash foreclosure aid.

Bank of America CEO Brian Moynihan said the agreements were “a significant step” in resolving the bank’s remaining legacy mortgage issues while streamlining the company and reducing future expenses.

Leaders of a House oversight panel asked regulators for a briefing on the proposed settlement on Friday. Regulators refused to brief Congress before announcing the deal publicly.

Maryland Congressman Elijah Cummings, the top Democrat on the House Committee on Oversight and Government Reform, said in a statement that he was “deeply disappointed” in the regulators’ actions.

“I have serious concerns that this settlement may allow banks to skirt what they owe and sweep past abuses under the rug without determining the full harm borrowers have suffered,” Cummings said. He said regulators have failed to answer key questions about how the settlement was reached, who will get the money and what will happen to others who were harmed by these banks but were not included in the settlement.

The settlement is separate from a $25 billion settlement between 49 state attorneys general, federal regulators and five banks: Ally, formerly known as GMAC; Bank of America; Citigroup; JPMorgan Chase and Wells Fargo.

© 2013 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.
If you find yourself in an unfortunate situation of losing or about to your home to wrongful fraudulent foreclosure, and need a complete package  that will help you challenge these fraudsters and save your home from foreclosure visit: http://www.fightforeclosure.net
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How Homeowners Can Effectively Defend Their Foreclosure

07 Tuesday Jan 2014

Posted by BNG in Affirmative Defenses, Federal Court, Foreclosure Defense, Judicial States, Litigation Strategies, MERS, Non-Judicial States, Pleadings, Pro Se Litigation, RESPA, Trial Strategies, Your Legal Rights

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If you have found yourself in an unfortunate situation of having to challenge a foreclosure lawsuit. Before you file your answer, I recommend that you have the Plaintiff’s attorney verify your debt. The Fair Debt Collection Practices Act, or FDCPA for short, states that any borrower undergoing a foreclosure proceeding against them has the opportunity to question the amounts owed, as long as the request for verification is made within thirty days of the Complaint being filed. It is very important to act quickly. The FDCPA verification letter does more than just verify the amount of money you owe; it also acts like a pause button to the foreclosure action.

The Plaintiff’s attorney may not proceed with the foreclosure until they verify your debt by sending the FDCPA debt verification letter to the same address where you were originally served, or to a different address that you specify. The production and mailing of this letter usually takes about a month, so you just bought yourself thirty days just by mailing a letter to the Plaintiff’s attorney. In this game, time is more valuable than money. Any stall tactics we can successfully implement are priceless.

If you’ve been served with a foreclosure lawsuit or expect one in the near future, it’s essential to know what foreclosure defenses may be available to help you dismiss, delay or win your case.

Because foreclosure laws differ from state to state and sometimes county to county within each state, we strongly urge you to hire a lawyer in your area to handle the case if at all possible. Whether you hire an attorney or defend your own foreclosure lawsuit, the more you know the more likely you’ll succeed so learn all you can about the foreclosure phases in your state as well as possible foreclosure defenses applicable to your situation.

Types of Foreclosure Defenses

There are six general categories of foreclosure defenses, also known as “affirmative defenses” in Florida and other states – defective service of the lawsuit documents, loan closing related defenses, breach of contract, standing/chain of title issues, fraud and misrepresentation and “catch all” defenses that may protect your rights if other defenses fail.

Once you identify your foreclosure defenses, you’ll either list them in the Answer to Your Foreclosure Lawsuit, as part of a Motion to Dismiss before filing your answer or as grounds for a counterclaim against the bank. Depending on the foreclosure defense involved, you may be able to use a combination of two and even all three of these options.

1. Defective Service of Process

In Judicial Foreclosure states which require the use of the court system to process foreclosures, the lawsuit itself and a summons must be personally delivered to you by a licensed process server. Referred to as “service of process”, there will be at least two documents involved consisting of the actual lawsuit and a summons for each defendant with instructions when and where to respond.

If the process server makes several legitimate but unsuccessful attempts to serve you, they’ll simply serve you by publishing notice of the lawsuit in the local newspaper so its generally better to accept the papers than hiding and hoping it goes away. The process server only gets paid if you get served so don’t expect them to give up and it’s safer to know what’s going on than missing important court deadlines because you never saw the legal notice in your newspaper.

Although it sounds pretty basic, sloppy paperwork and fraudulent practices have once again conspired to make this an important foreclosure defense for homeowners who were never served or served improperly. Defective service of process obviously includes instances when you were never served despite living in the property, but can also be when the process server didn’t take all the state required steps to find you, served a minor or the house next door, files false affidavits in court about who they served and when, forged signatures or backdated documents and a host of similar intentional and unintentional actions that may justify dismissing the lawsuit.

If this defense applies to you, it may be grounds for a motion to dismiss the foreclosure lawsuit and/or part of your answer to the lawsuit as an affirmative defense. Consult with an attorney in your area familiar with the local requirements for process servers if possible and include the defense as part of your lawsuit answer by stating something similar to “As a first affirmative defense, the service of process was defective.” This is just an example that should be modified in accordance with the local pleading rules for each county and state to make sure you meet the local requirements.

2. Loan Closing Related Defenses

There are several related foreclosure defenses we’ve grouped under this category that arise from federal disclosure requirements under the Truth in Lending Act(“TILA”)and the Real Estate Settlement Procedures Act(“RESPA”).

Each of these federal laws were created to help consumers by forcing lenders to disclose the material terms of your loan including the actual dollar amount of all finance charges over the life of your loan, a good faith estimate of potential closing costs provided to you prior to closing, an explanation of your three day right to cancel the entire loan transaction and other essential disclosure requirements that may result in the actual rescission of your loan documents under certain circumstances.

Because this is a very technical area requiring expertise in evaluating your HUD-1 closing statement and related documents that is beyond the scope of this discussion, we strongly suggest that you retain an attorney or experienced realtor to help you analyze your loan documents and determine if violations exist. If you suspect that there are deficiencies, there are several critical steps that must be taken to protect your rights including sending a “Notice of Rescission” to your lender before the lender corrects the defects.

3. Breach of Contract

Breach of Contract is one of the strongest foreclosure defenses available to homeowners and investors and may also be grounds for a motion to dismiss or counterclaim against the bank. Although the specific allegations can be similar to those made in other foreclosure defenses, breach of contract claims should almost always be used as a stand alone defense if sufficient facts exist.

Without providing a seminar on contract law, there are three basic elements to every breach of contract claim-a valid contract, breach of some obligation imposed by that contract, and damages specifically resulting from the breach itself. For example,your obligation as borrower under the contract (the loan documents) is to make timely payments of the amount you’ve agreed to pay, while the bank must also comply with its contractual requirements.

One of the most frequent breaches by the bank is purchasing “forced placed” insurance that is either unnecessary, overly expensive or both. The damage from the breach is your inability to make monthly payments because of the higher insurance costs and as a result, you would not have breached your obligation to make monthly payments if the bank hadn’t first breached its obligations by forcing you to pay more than your contract requires.

Other possible breaches by the bank include failing to comply with its own underwriting requirements in giving you loan terms that were unfair or not supported by your income. By offering no interest or adjustable rate loans that later skyrocketed upwards, balloon payments due in the midst of an economic crisis or even providing too much money for a loan they knew you couldn’t afford, the bank breached its contractual obligations in many respects.

Finally, additional examples include breach of the disclosure requirements in RESPA or TILA discussed above or failing to provide adequate notice of default and its intent to accelerate the payment requirements as specified in paragraph 22 or 23 of most mortgages.

No matter where you allege the breach of contract – in a motion to dismiss, answer or counterclaim – you need to be very specific about the facts. Thus, breach of contract as a defense in your answer should read something like “As a third affirmative defense, the bank breached the contract by purchasing forced place insurance that was either unnecessary or too expensive” or ” by failing to provide proper notice of its intent to accelerate the loan as required by paragraph 22/23 of my mortgage.”

Of course modify these examples to reflect your specific circumstances and to comply with local court rules and procedure. Even if you decide not to hire an attorney to defend your case, you can always hire a lawyer for an hour or two to help you meet local requirements.

4. Lack of Standing/Defective Chain of Title

Ask homeowners who owns their mortgage and most will confidently tell you its the company they pay each month. However, the answer is much more complicated as the original loan was almost certainly transferred several times since closing and at best you’re likely paying the loan servicing company not the original owner.

The importance of this defense – called “lack of standing” or “defective chain of title” – can’t be overstated as several courts have found fraudulent, backdated and inadequate loan documents in many cases and have actually dismissed foreclosure lawsuits with prejudice as a result. Lack of standing to sue and/or not owning the loan documents can be the grounds for a motion to dismiss, an affirmative defense in your answer or the basis for a counterclaim against the bank.

There are at least three important documents to review before deciding if this defense can help you – the mortgage or deed of trust, the promissory note and any assignments involved in transferring the loan from one bank to another. The current owner of your loan must have physical possession of each of these original “wet ink” documents and every transfer must be properly endorsed on the documents and recorded in the county where the property is located together with payment of recording and doc stamp fees. Finally, make sure the current assignment was dated prior to the the date the foreclosure lawsuit is filed with the court.

With the huge number of mortgages transactions, many banks have no idea where the original documents are, most failed to properly record each transfer or assignment and in too many situations actually forged or backdated documents in an effort to meet legal requirements. In fact a recent Reuters investigation involved a random review of foreclosure files from five different states and found more than 1000 questionable mortgage assignments, promissory notes with missing or faulty endorsements and foreclosure lawsuits containing multiple inaccurate facts.

During the early stages of the foreclosure crisis, the bank’s strategy of filing lawsuits without proper documentation worked well and many people unnecessarily lost their homes as a result. However, recent court decisions have refused to endorse these illegal bank schemes and have required compliance with basic evidence standards instead. To proceed with foreclosure lawsuits, most courts now require proof that the banks have physical possession of the original documents and further require evidence to show how they got the documents and that the chain of title is not defective.

A couple of additional issues to watch out for are any cases involving “MERS” as the plaintiff in your foreclosure lawsuit and whether or not a loan servicing company has authority from the mortgage owner to file suit and confirming that the owner even has authority to do so. MERS stands for the “Mortgage Electronic Registration System” banks created in an attempt to hide mortgage transactions from public scrutiny and avoid paying recording fees for each transfer. Most courts have finally decided that MERS has no standing to sue homeowners so be sure to raise any and all defenses related to this issue.

For more information on MERS and the illegal and fraudulent actions of banks and lenders involved in the foreclosure fiasco, we strongly recommend an excellent site by Greg Hunter called USA Watchdog.com which contains numerous interesting and well researched articles on the subject overall.

As you can see from this very brief discussion, lack of standing and figuring out who owns your mortgage is both an important defense and complicated subject. As a result, we strongly urge you to retain an attorney to handle your case if these issues arise or at minimum consult with a lawyer for a couple of hours to help you focus on the right issues and discuss strategies to get documents the banks refuse to provide.

When raising this issue as an affirmative defense in your answer, it should read something like “As a fourth affirmative defense, the plaintiff lacks standing to sue as a result of a defective chain of title and related issues.” As always, modify this example to reflect your specific circumstances and to comply with local court rules.

5. “Catch All” Foreclosure Defenses

“Catch All” foreclosure defenses refer to procedural devices and general defenses to make sure you raise all possible issues that may help you and/or to supplement other applicable defenses that are missing one or more of their required elements.

The first defense in this category is called “failure to state a claim upon which relief can be granted” and the second is “the failure to comply with conditions precedent.”

The failure to state a claim upon which relief can be granted is similar in concept to the breach of contract and lack of standing defenses raised above and generally addresses deficiencies in the required documentation and whether or not the plaintiff is the actual owner of your loan and has the right to sue you. The defense can be used as grounds for a motion to dismiss or as an affirmative defense in your answer, but is rarely used to support a counterclaim against the bank. Even though the defense may overlap with other applicable defenses, it’s almost always worthwhile to list as an additional affirmative defense.

The second “catch all” defense is the failure to comply with conditions precedent and covers issues ranging from the failure to provide proper and timely notice of default and the bank’s intention to accelerate your loan payments and/or failing to properly attach the required documents to the foreclosure lawsuit. Again, it’s almost always worthwhile to list this as an additional affirmative defense to cover areas you may have missed.

6. Fraud and Misrepresentation Foreclosure Defenses

The final category of defenses addressed in this article are fraud and misrepresentation by the bank, the loan servicing company or the mortgage broker on behalf of the bank. Although this defense may be right on point for many of the improper actions by the bank, the pleading requirements are much more difficult for anything related to fraud and thus require far more detail than the defenses raised above.

This doesn’t mean you shouldn’t use this defense if sufficient grounds exist, but be prepared to state the exact nature of the fraud or misrepresentation, when it occurred and in what context as well as any additional information you may have. Because many of these issues require discovery and review of bank documents you may not have at the time you respond to the foreclosure lawsuit, courts may dismiss your defense until you have more information. Remember you can always amend your answer at a later date once you have the necessary information, so make sure you have enough evidence initially before deciding to include this as a defense. The idea is not to throw everything in and hope something works as the bank and courts will see through this strategy and minimize your credibility even though legitimate defenses exist.

Your affirmative defense should read something like “As a sixth affirmative defense, the bank is guilty of fraud and misrepresentation in the following manner” and then include the facts necessary to support your allegations. If possible, meet with an attorney to help you identify any potential fraud and help comply with local court pleading requirements.

If you find yourself in an unfortunate situation of losing or about to your home to wrongful fraudulent foreclosure, and need a complete package  that will help you challenge these fraudsters and save your home from foreclosure visit: http://www.fightforeclosure.net

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