HOMEOWNERS'
ASSOCIATION:
In re Foster sides with the HOA basically
stating that the assessments are a liability that runs with
the land. I do not know where that leaves Congress' leaving
out 1328(a) as one of the exceptions to 523(a)(16), -
basically it makes no difference even though Congress
specifically excluded 1328(a).
(L.
Karandreas briefed 9/11)
HOMESTEAD:
In re: Gebhart
In consolidated Chapter 7 bankruptcy petitions in which the
value of debtors' homes increased so that they had equity in
excess of the homestead exemptions, the bankruptcy court's
order approving the appointment of a real estate broker to
sell the home for the benefit of the estate is affirmed
where the fact that the value of the claimed exemption plus
the amount of the encumbrances on the debtor’s residence
was, in each case, equal to the market value of the
residence at the time of filing the petition did not remove
the entire asset from the
estate. http://www.ca9.uscourts.gov/datastore/opinions/2010/09/14/07-16769.pdf
MERS: Mortgage Electronic Registration System: (not
bankruptcy case)
U.S. DISTRICT COURT DISMISSES NON-JUDICIAL
FORECLOSURE: MERS NOT AUTHORIZED TO FORECLOSE MAY 15
2011
Issues order blocking foreclosure and grants declaratory
relief to homeowner
Hooker v. Northwest Trustee Services, Bank of America, MERS
District Court District of Oregon case no. 10-3111-PA
"Considering what is commonly known about the MERS system
and the secondary market in mortgage loans, plaintiffs
allege sufficient facts to make clear that defendants
violated the Oregon Trust Deed Act by failing to record all
assignments of the trust deed.
"While I recognize that plaintiffs have failed to make any
payments on the note since September 2009, that failure does
not permit defendants to violate Oregon law regulating
non-judicial foreclosure.
" ... MERS, and its registered bank users, created much of
the confusion involved in the foreclosure process. By
listing a nominal beneficiary that is clearly described in
the trust deed as anything but the actual beneficiary, the
MERS system creates confusion as to who has to do what with
the trust deed.
"The MERS system raises serious concerns regarding the
appropriateness and validity of foreclosure by advertisement
and sale outside of any judicial proceeding. "MERS makes it
much more difficult for all parties to discover who "owns”
the loan. When a borrower on the verge of default cannot
find out who has the authority to modify the loan, a
modification, or a short sale, even if beneficial to both
the borrower and the beneficiary, cannot occur."
CLICK HERE FOR FULL TEXT OF RULING
In re Veal, (9th Cir BAP)
6/10/11 Bk. No.
09-14808
FAILURE TO PROPERLY DOCUMENT TRANSFER OF INTEREST IN NOTE OR
OTHER FORMALITIES RESULTS IN LACK OF STANDING TO FORECLOSE:
MOTION FOR RELIEF FROM STAY DENIED
In this Chapter 13 case the ostensible agent for Wells Fargo
Bank could not establish that Wells Fargo had possession of
the note or had other right to payment. This lengthy opinion
is a thorough stand-alone discourse on the key elements
required for standing to foreclose (and hence assert a claim
in bankruptcy), and draws an important distinction between
assignment of the mortgage and assignment of the
note.
Wrote the court: "We hold that a party has standing
to seek relief from the automatic stay if it has a property
interest in, or is entitled to enforce or pursue remedies
related to, the secured obligation that forms the basis of
its motion.
"Thus, unlike the assignment from GSF to Option One, the
purported assignment from Option One to Wells Fargo does
not contain language effecting an assignment of the Note.
While the Note is referred to, that reference serves only to
identify the Mortgage. Moreover, unlike the first
assignment, the record is devoid of any indorsement of
the Note from Option One to Wells Fargo. As a
consequence, even had the second assignment been considered
as evidence, it would not have provided any proof of the
transfer of the Note to Wells Fargo. At most, it would have
been proof that only the Mortgage, and all associated rights
arising from it, had been assigned.
"Here, the Veals allege that neither Wells Fargo nor AHMSI
have shown they have any interest in the Note or any right
to be paid by the Veals. They seek to invoke prudential
standing principles which generally provide that a party
without the legal right, under applicable substantive law,
to enforce an obligation or seek a remedy with respect to it
is not a real party in interest.
" .. while the failure to obtain the indorsement of the
payee or other holder does not prevent a person in
possession of the note from being the “person entitled to
enforce” the note, it does raise the stakes. Without holder
status and the attendant presumption of a right to enforce,
the possessor of the note must demonstrate both the fact
of the delivery and the purpose of the delivery of the note
to the transferee in order to qualify as the “person
entitled to enforce.”
"As to Wells Fargo, it had to show it had a colorable
claim to receive payment pursuant to the Note, which it
could accomplish either by showing it was a “person entitled
to enforce” the Note under Article 3, or by showing that it
had some ownership or other property interest in the Note.
"In particular, because it did not show that it or its
agent had actual possession of the Note, Wells Fargo could
not establish that it was a holder of the Note, or a “person
entitled to enforce” the Note. "In addition, even if
admissible, the final purported assignment of the Mortgage
was insufficient under Article 9 to support a conclusion
that Wells Fargo holds any interest, ownership or otherwise,
in the Note. Put another way, without any evidence tending
to show it was a “person entitled to enforce” the Note, or
that it has an interest in the Note, Wells Fargo has
shown no right to enforce the Mortgage securing the Note.
Without these rights, Wells Fargo cannot make the threshold
showing of a colorable claim to the Property that would give
it prudential standing to seek stay relief or to qualify as
a real party in interest.
"In the context of a claim objection, both the
injury-in-fact requirement of constitutional standing and
the real party in interest requirement of prudential
standing hinge on who holds the right to payment under
the Note and hence the right to enforce the Note. "With
respect to Wells Fargo’s request for relief from the
automatic stay, we hold that a party has standing to seek
relief from the automatic stay if it has a property interest
in, or is entitled to enforce or pursue remedies related to,
the secured obligation that forms the basis of its motion.
" ... the purported assignment from Option One to Wells
Fargo does not contain language effecting an assignment of
the Note. While the Note is referred to, that reference
serves only to identify the Mortgage. Moreover, unlike the
first assignment, the record is devoid of any indorsement of
the Note from Option One to Wells Fargo.
"As a consequence, even had the second assignment been
considered as evidence, it would not have provided any
proof of the transfer of the Note to Wells Fargo. At
most, it would have been proof that only the Mortgage,
and all associated rights arising from it, had been
assigned.
CLICK HERE FOR TEXT OF VEAL OPINION
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