Refusal to Verify Means Dismissal – Without Leave to Amend
One of my ongoing frustrations as a foreclosure defense attorney is seeing banks and their lawyers repeatedly and systematically refuse to comply with basic rules of procedure and/or Florida law. One common example is their repeated refusal to verify their Complaints in residential foreclosure cases, as required by Fla.R.Civ.P. 1.110(b). This is a really simple thing to do (or, at least it should be, if banks are acting appropriately), yet banks and their lawyers routinely file foreclosure lawsuits on residential property without a verification. Respectfully, there is absolutely no excuse for this.
When any party in a Florida lawsuit fails to comply with a rule of procedure or an Order of the Court, e.g. the requirement in 1.110(b) to verify foreclosure complaints, dismissal is an authorized remedy. See Fla.R.Civ.P. 1.420(b). Unfortunately, all too often, when banks fail to include the requisite verification, judges give them a second chance, giving them leave to file an Amended Complaint. Essentially, this means the bank can fix the problem within the confines of the pending lawsuit.
Respectfully, this drives me nuts. Banks and their lawyers are willfully and intentionally violating a rule of the Florida Supreme Court on a routine, systematic basis. Why is there no sanction for this? Why should they get a “do-over”?
When this happens, I believe dismissal with prejudice is an appropriate sanction. At minimum, the dismissal should be without prejudice but without leave to amend. This way, the banks will have to re-file a new lawsuit, with a new case number, and pay a new filing fee. If more judges ruled this way, like this judge just did, then banks and their lawyers would learn their lesson (presumably) and stop refusing to comply with basic rules of procedure.
The judge’s Final Order of Dismissal sets forth this precise rationale. I’ve been waiting for a ruling like this for months – what a joy to read. After months of watching banks’ willful misconduct go unpunished, it’s great to see a Florida judge enter a sanction for such obvious misconduct.
Mark Stopawww.stayinmyhome.com
Posted in Main | 6 Comments »
Don’t Bite the Hand That Feeds You?
Most foreclosure defense attorneys continue to complain about how judges respond to what appears as foreclosing plaintiff blatant disregard for the rules of civil procedure. Sometimes the response by judges not only appears lackadaisical, but outright favoring the offending plaintiff and their attorney. It is entirely possible that even attorneys for the plaintiff are surprised too, even if only once awhile. Nonetheless, there seem to be two sets of rules – one applying to every other type of case and another that applies to mortgage foreclosures. And, many judges readily allow violations of the rules with such cavalier attitude that it is offensive to those that are charged with a duty to protect the integrity of the legal proceedings, attorneys who are also officers of the court.
The problem with pleading verifications is multi-dimensional. First, where a plaintiff fails to comply with a Supreme Court mandated requirement to verify a foreclosure complaint – which can only be viewed as intentional – it opens the door for the plaintiff to offer up pleadings, allegations, documents and facts that may be pure fiction. Second, this deliberate disregard for the verification rule further masks the real identity of the foreclosing plaintiff, or at a minimum helps shield the party bringing the action from being held accountable under the verification standard imposed by Rule 1.110(b). Third, the failure to comply exposes every defendant to respond to the action and defend against an entity that, aided by its attorneys, has bypassed a consumer protection important enough to have been instituted by the Florida Supreme Court. In the end, without any accountability the plaintiff that intentionally perpetrated the violation by failing to verify its complaint is left to commit courtroom sin with impunity. This sin impacts the lives of families who are oftentimes displaced from their homes under the force of the law.
When judges refuse to enforce the rules of civil procedure it signals to the offending party that “it’s ok to do this in my courtroom – don’t worry about it.” It also signals to others that the court is biased in favor of foreclosing plaintiffs, the banks. But why would judges do this in light of the fact that there are many types of cases coming before them other than foreclosure? What is the impression that litigants and their attorneys get when witnessing the judge’s outright disregard for the rules of civil procedure and often long-standing case law? And, what would give a judge the motivation to reach and maintain this posture for such an extended period of time? Any observer really paying attention will be hard pressed not to reach the conclusion that there is something really wrong here.
Florida Judges, conservative by nature, have been made to act in a manner contrary to their oath, duty and past history in large part because there is currently a significant conflict of interest built into the system. That is, the judiciary’s budgetary constraints – think money – has been significantly impacted in large part by the very entities that violate its rules. That makes the courts of our state and our elected judges beholden to the banks and other foreclosing plaintiffs, plain and simple. The judiciary needs the foreclosure filing fees for their very survival. A foreclosure moratorium, mythical and fictional by any stretch of the imagination, would leave the Florida court system feening for another shot. The impact would be devastating by some accounts. Anyone doubting this issue exists can simply refer to comments made recently by the highest judicial officer in our state, Chief Justice Charles Canady. The good justice, while urging against continued cuts to the court system budget, appeared worried about the reduction in filings by foreclosing plaintiffs when he said “we’ve seen a drop in the filings”. He goes on to say that “Lenders, because they didn’t have their act together, they’ve not been filing the way that was anticipated.” Apparently there was some expectation regarding the number of foreclosure filings that did not happen and that had a big impact on the judiciary’s budget.
In all fairness the Chief justice was also saying that these filing fees are not going to bridge the budgetary gap in the short-term or the long-term. However, it becomes one of these duh moments when any casual observer might conclude, wait a minute – the courts need money and the biggest source of money is coming from these foreclosing banks – of course the judges aren’t going to rule against the banks and bite the hand that feeds them. The appearance of bias and conflict of interest is inescapable. The state court system’s $370 million trust fund gets 80% of its money, or $285 million, from foreclosure fees. What circuit court judge is going to destroy their career by bucking the system? So what if some rules are not followed and that fraud has overtaken and compromised the integrity of the courts. The trust funds must be protected – or so we have been told. History will record this period as yet another example of how financial institutions corrupted even our most trusted institution, the judiciary, and how the people eventually lost faith. It’s scary to think where all of this will go when the people no longer believe in the fairness and impartiality of what was once the best legal system in the world.
So when you hear foreclosure attorneys complain about plaintiff violations of rules of civil procedure and the court’s departure from essential requirements of law, take a step back and put it all into perspective. The plaintiffs have essentially bought themselves an entire state judiciary – even if only in appearance. Ironically, this out-in-the-open strategy is very different than when a judge is compromised by a bribe in some back office. In the latter case there is someone to charge, prosecute and remove from the bench. It’s a very high price to pay for such a fall. However, in the current context where the entire judiciary has been systematically hijacked, the price to be paid will be borne by all Floridians for years to come. Florida will be plagued with clouds on property titles for years. And, who in their right mind would want to relocate their company to Florida when there is little to no confidence in the state’s ability to resolve disputes? Every principal, associate, supplier or employee relocating to Florida would be exposed to buying property that may be subject to future attack on title, or perhaps entirely be ineligible for title insurance. That is assuming the new buyer can even obtain a loan because of the history of the title is in question.
This is what those filing fees have purchased. Want the fees to continue? Then don’t rule against the banks. Want a balanced system of justice everyone can believe in – restore the faith of the people by eliminating the appearance of bias and ruling according to the law before it’s too late. So much has already been lost.
Pingback: Case Dismissed WITHOUT Leave to Amend | FL Rule 1.110(b) Verification of Mortgage Foreclosure Complaint
Pingback: Case Dismissed WITHOUT Leave to Amend | FL Rule 1.110(b) Verification of Mortgage Foreclosure Complaint « Foreclosure Fraud – Fighting Foreclosure Fraud by Sharing the Knowledge
I just got this update from http://www.loansafe.org/forum/loan-modification/37881-california-appeals-court-rules-homeowners-can-sue-banks-fraud-over-broken-loan-modification-promises.html
It makes me wish I was back in California, it was always such a progressive place, at least until Reagan got in as governor.
Anyway, I just had to pass this on, it’s too good to keep a secret.
This is almost the same way GMAC foreclosed on my house except they weren’t even the lender at the time.
Old commercial said:
That pretty much sums up what had been going on for the last few years. It’s totally sickening to think about.
Good luck to all
http://www.loansafe.org/forum/loan-modification/37881-california-appeals-court-rules-homeowners-can-sue-banks-fraud-over-broken-loan-modification-promises.html
California Appeals Court Rules Homeowners Can Sue Banks for Fraud Over Broken Loan Modification Promises
Well, first let me just say… it’s about damn time.
Did I already say that it’s about damn time? Well, it totally is.
Claudia Aceves received a foreclosure notice from U.S. Bank, so she filed for bankruptcy protection and the foreclosure was halted. Her plan was to file Chapter 13, which would mean that she could very likely keep her home and under a court approved repayment plan. Then she got a call from the nice folks at U.S. Bank… and the bank’s representative said… I’m paraphrasing here…
So, she did.
And just five days later… without so much as a courtesy call or even a “F#@k you” card… U.S. Bank scheduled her home to be auctioned off a month later.
See… this is an excellent example of why I’m starting to think we’ve become too civilized a society. I was born back in Brooklyn, New York, I mostly grew up in Pittsburgh, and my wife’s from the City of Chicago… and I’m here to tell you that if someone tried to pull something like that on someone else in any of those places back when we were kids, the offending party would pray for the dispute to be settled in a courtroom, you know what I’m saying here?
Claudia told Bob Egelko of the San Francisco Chronicle that the bank was nice enough to contact her attorney the day before the sale to offer her the chance to save her home by agreeing to a higher monthly payment.
The auction went on as scheduled and would you like to venture a guess as to who purchased Claudia’s home? Come on, you can do it… why, U.S. Bank, of course!
And just two months later, the bank pinned an eviction notice to her door.
What would they say over in England… oh, that’s right… Jolly good show! In fact, I’d have to add… crackerjack work… that is one fine piece of banking right there, wouldn’t you say?
So, instead of, let’s say… causing someone great bodily harm or significant property damage… Claudia filed a lawsuit against her bank… only to have a lower court judge dismiss it!
Hey look… I can understand that… I mean, she was the one who was having trouble making the mortgage payment on her $845,000 loan, which almost undoubtedly secures a property worth something under $500k. And she had a chance to keep her home through a court approved repayment plan had she gone ahead with her Chapter 13 filing.
But, noooo… she withdrew her filing, now didn’t she? And whose fault was that? She knew she was dealing with a bank, and she went ahead and relied on what they said… I mean… come on… who would do something like that in this day and age?
I could see it if she had gotten a call from say… the mob… you know, good old organized crime. Sure, then she could have reasonably assumed that the caller would keep his word and help her modify her loan, but a bank representative? There’s no way I’d believe anything a bank representative told me over the phone.
So, the lower court dismissed her frivolous claim, but what do you know… it must be a brand new day in the California courts because the Second District Appeals Court picked it right back up and, even though they declined to reverse the foreclosure, this past Thursday the court ruled 3-0 that…
“… a lender who falsely promises to help a homeowner prevent foreclosure can be sued for fraud.”
The court, according to Friday’s Chronicle, said:
Well, first let me just say… it’s about damn time.
Did I already say that it’s about damn time? Well, it totally is.
As someone who has lived in other countries and now USA for almost 30 years one thought has come to mind.
I do not wish to work my whole life and be led to believe that is the only way to be privledged enough to OWN. But that is what the United States Government seems to want everyone to believe. That in order to OWN, work your whole life away. How is that worth it?
I no longer need credit. Credit ought to be a thing of the past. As someone who had a credit score of about 800, had multiple businesses, bought property cash, it no longer is necessary. Banking reform, since 2008 has become the single most important issue of the USA. If we can not repair that, how does anyone here suceed?