State Courts Stubbornly Refuse To Abide By Explicit Ruling By U.s. Supreme Court In Mortgage Law, Tr

Social Apocalypse

LoanSafe Member
Mar 17, 2009
693
12
18
Washington State
For those of you considering TILA Rescission; my 7 year story. LEARN from it.

To the hardworking, skilled attorneys who believed in us and worked so hard and gave their advice, we are forever indebted, our fight started RIGHT HERE on LoanSafe.org

May 20, 2016

Woodland, WA -- In a ruling by the Washington State Court of Appeals on May 10, 2016, borrowers Todd and Theresa Baker were told that even though they were never in default on their mortgage, and did nothing wrong, their home of 22 years would be sold at auction because the court’s erroneous ruling was in the past, so it would stand. The logic being that the court cannot risk causing disruption to the new buyers of the Baker’s home (who purchased the house at auction with full awareness of the pending litigation-lis pendens) because that “would be unfair”.

The lender, who the Baker’s maintain had no legal right to their home due to a lawfully rescinded promissory note, convinced a trial court in 2014 that the Baker’s had incorrectly rescinded their predatory mortgage (which was not in default) for violations of the Truth In Lending Act. Following the decision of the Clark County Superior Court ruling on summary judgement that there were procedural errors in the Baker’s 2009 TILA Rescission, the Baker’s home was put into foreclosure.

The appeals ruling: Download Denial-by-WCA

TILA Rescission

When borrowers sign on the dotted line for a new mortgage on their home, the United States Congress put in place laws that would serve to protect borrowers from unfair lending practices such as misstating fees and charges, or not clearly outlining the terms of a mortgage or providing required disclosures. This gave borrowers and lenders a level playing field and the reassurance that their transaction was protected by law to be as they were being told it was.

One of the more powerful laws is contained in the Truth In Lending Act: Mortgage Rescission ("TILA Rescission"). While most people can recall getting documents at a loan closing saying that they have a right to cancel the transaction within three days of signing if they choose, what many people do not know, is that this same law also states that in certain transactions (like mortgage refinances) your right to rescind is extended to three years if there are certain material defects and/or omissions. It is the extended three year right of rescission that was recently addressed and clarified by the United States Supreme Court in January of 2015 because of a widely occurring problem of lower courts misinterpreting the law, making it nearly impossible to use by a borrower.

Reality: TILA Rescission still is not what it was intended to be by Congress-Even post-Jesinoski

Less than two years after the trial court erroneously ruled that the Baker’s had improperly rescinded their mortgage, on January 23, 2015, with the Baker’s still in possession of their home and fighting to save it, there was a landmark unanimous ruling in the United States Supreme Court regarding the proper invocation of a TILA Mortgage Rescission in Jesinoski v. Bank of America. The ruling settled a circuit court split that was creating conflicting and erroneous rulings around the nation. Lower courts were ad-libbing all kinds caveats to the facially simple and direct remedy to a fraudulent or defective mortgage. The US Supreme Court, in its ruling, settled all doubts about the act of invoking a TILA Rescission, and stated that there is no change in this law, it is now as it has always been, and no court has the discretion to change it. Unfortunately for the Baker's and most any other borrower who relied on this remedy, the Supremes did NOT address in detail the EFFECT of TILA Rescission. Though it is spelled out in unambiguous language in USC1635(b), courts are still making up their own rules about it. Washington State courts especially.

Bakers file a Rule 60(b) motion from relief from judgement

Immediately, the Baker’s attorney filed a rule 60(b) motion for relief from judgement, asking the trial court to reverse their erroneous ruling, and allow the Baker’s to litigate the issues surrounding their rescission for the very first time. In circumstances where justice was not served by a ruling, a rule 60(b) motion gives the court the authority to overturn their ruling at their discretion in the interest of equity. If a party demonstrates that a great wrong has been committed then a court abuses its discretion if it does not reverse.

The trial court's ruling

On March 9, 2015 the trial court, in a stark, one-sentence ruling, decided against the Baker’s stating that she would not reverse her ruling because “a change in the law is not an extraordinary circumstance” even though the Supreme Court was explicit that this was not a change in the law. The Baker’s immediately filed an appeal alleging the trial court had abused her discretion, and that there was no change in the law, this was clearly articulated by Justice Scalia in the US Supreme Court's unanimous ruling in “Jesinoski”. It was the court that erred, not the Baker’s.

Foreclosure trustee rushes to auction the Baker’s home of 22 years

Soon after the trial court ruled against the Baker’s, the foreclosing trustee, Northwest Trustee Services, rushed to auction their home, even though their case was on appeal. Northwest Trustee Services, though required by law to be a neutral referee in foreclosure actions, had been in a contentious battle with the Baker’s for almost 7 years now. The Baker’s filed a “lis pendens” (notice of pending litigation) against the title of their home to announce to any potential buyer that the home was in litigation, warning them that the title would be affected. The Baker’s were convinced that, by rushing to auction their home before the appeals court heard the case, the trustee was attempting to manipulate the appeals court by creating an obstacle against ruling in their favor. Courts do not like their rulings to harm innocent third parties, like buyers of a home at a foreclosure auction.

Baker’s lose on appeal

On May 10, 2016 the appellate court ruled against the Baker’s. The appellate court was asked to decide whether the trial court had abused its discretion when it refused to concede it’s error in 2014 and relieve the Baker’s from judgement. The two weightier issues in this ruling were regarding “finality” and whether reversing would have “prospective application”. “Finality” addresses parties’ reliance on a court's ruling being final. To decide whether finality is affected, it is argued whether any parties will be unfairly injured by the court reversing themselves. The Baker’s argued that since the trial court was deciding on an issue that if reversed, would affect no one, finality was not affected. At the time the trial court heard their case, the Baker’s were still in possession of their home (it had not been sold to an innocent third party) further, the lender was not even entitled to the home by operation of law, according to Justice Scalia in the US Supreme Court ruling. The Baker’s were merely asking for the opportunity to go to court to litigate the issues.

The law also says that if sustaining the erroneous judgement had “prospective application” then the court should reverse. Carrying out the result of the erroneous ruling even though it was no longer equitable is “prospective application”. The Baker’s argued that there was prospective application in that at the time of the trial court’s ruling the home was not scheduled to be sold, and losing their home was the logical end consequence of the erroneous decision. When an appeals court analyzes whether or not a trial court abused their discretion, they are to examine the facts that were presented to the lower court. It would be counter-intuitive to consider facts that occurred AFTER the trial court ruled. Nonetheless, this is what happened.

The appeals court said that finality is affected and there was no prospective application because the house had since been sold, and that a third party would be affected and they would not disturb that. The Baker’s were stunned that the tactics of the foreclosing trustee of selling their home after the trial court had ruled and during their appeal effectively caused them to lose their appeal case. They didn’t lose on the merits of their case, but on the manufactured circumstances of a foreclosure trustee who is legally required to conduct a neutral process of divesting someone of their home when they defaulted on their obligations to their lender. The Baker’s never defaulted on their obligations at any time.

The Baker's respectfully ask you to share this information so that it might help others.
They would also like to thank the many, many people who have supported them through this horrific time in their lives and they thank God for their beautiful children and compassionate friends.

You can read the entire thing and more on my blog SocialApocalypse.com
 

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
26,799
456
1,000
48
Southern California
www.loansafe.org
Thanks for sharing your story Theresa. It has been a quite a while since I have seen you around these parts.

Wow, it has been 7 years. I remember you were very active here for many of those years.

I'm sorry that in the end, you didn't win the case. But I'm happy that you fought the good fight for so long and didn't give up. That is what everyone should do if they can and not take the unlawful behavior of these mortgage servicers and trustees laying down.

Good luck too you and yours. I hope everything works out and you all find peace in the end.
 

Social Apocalypse

LoanSafe Member
Mar 17, 2009
693
12
18
Washington State
Hi Moe! What a joy to see your reply, and how kind that you remembered me. It has been years, and it has been a royal nightmare. Since the Jesinoski ruling last year (which was INDEED great, monumental news!!) It has been followed by a mushroom cloud of excitement and people rushing to use this "miracle remedy". Again, I encourage people to read my experience. Now, my big challenge right now is trying to overturn a final ruling, and that's tuff to do in any court, HOWEVER, the very premise of TILA Rescission is that the note becomes void, and nothing UNvoids it. That means NO COURT has jurisdiction to rule on these instruments. Just like everything else that I have seen in foreclosure litigation, there is the LAW and then there is the way the courts actually RULE. Usually these are two completely different things, and NO there is not much that can be done about it. It is a sad fact that most courts are firmly against ruling against the banks. Our nation is in peril.
Thank you SO MUCH for all you do! Theresa
 
  • Like
Reactions: Moe Bedard

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
26,799
456
1,000
48
Southern California
www.loansafe.org
Hey!

You are welcome. Thanks so much for sharing your story here on LoanSafe and your involvement in the community.

As you know, I was very involved in legal procedures and methods homeowners could use to combat these lending and mortgage servicing abuses. Then came the lawsuits and courts who seemed to rule outside the law as if they were making it up as they go. I had seen this time and time again.

Yes, our nation is in peril and I only see it getting worse. There is now lot's of news and experts claiming we are now on the verge of a new, and more terrible crisis that will be biblical in scope.

Just this week, Jim Rogers has said the same and was quite outspoken about how it was written in the Bible. He referred to a biblical quote from the Book of Joshua: “You are under a curse now. You will always be servants. You will be woodcutters and water carriers for the house of my God.”

https://www.dollarvigilante.com/blog/2016/05/24/first-soros-now-jim-rogers-predicts-trillion-dollar-biblical-crash.html

Hang on Theresa...we still may be in for another ride like never before!!!!