Matt Weidner – Fighting For The American People

Posts Tagged ‘litton loan servicing’

In many foreclosure cases, it’s usually clear that the homeowner did not pay the mortgage.  Sometimes there are reasonable explanations for this such as the borrower’s inability to identify who to pay the mortgage to. (Remember that as of May 2009, the lender is required to provide to borrower an Assignment of Mortgage under the Federal Truth in Lending Act…The lender’s failure to do so could give rise to a real defense to foreclosure, an issue we’re currently researching, but that’s a whole ‘nuther blog.)

Who Has a Right To Foreclosure on a Mortgage?

If you borrowed from Downtown Bank and didn’t pay, it would be clear they have a right to foreclose.  In the current Alice in Wonderland, Acid Trip environment of frakenstein lenders and shadowy ill-defined foreclosing plaintiffs, it’s very difficult just who is foreclosing and even more difficult to figure out who is entitled to be paid.

A typical foreclosing Plaintiff name may be (1)US Bank, as (2)trustee for (3)The IXIS 2006-E Mortgage Trust, (4)Certificateholders.  I’ve placed those numbers in parenthesis because there are at least four different parties listed in that name.  Now just who among them is entitled to foreclose and even after you answer that question which among them will receive the actual proceeds of a foreclosure sale? The fact of the matter is no-one has any idea.  By and large judges don’t care and quite frankly even the most sophisticated foreclosure defense attorneys are beginning to ask these questions.  The questions are even more important when the foreclosing Plaintiffs are a servicer like Aurora Loan Servicing or Litton Loan Servicing.  Is anyone policing these companies to see if the investors in the pools are actually receiving any of the proceeds of foreclosures or modifications?  The first step in answering any of these important questions is to force plaintiffs to plead the capacity of each party, then in discovery force them to conclusively establish the relationship among all parties.  Capacity is a winner of an issue even at the Motion to Dismiss stage and even in front of the most hostile judge…this is especially the case in complicated securitized mortgage cases.

What if The Loans Really Are Paid?

Beyond those issues, please consider some very thought provoking questions presented by a very astute reader of this blog.  It’s very complex stuff, but it all boils down to do we have any faith that the well-connected powers that put all this in play have not crafted themselves an “out” strategy that still has them winning?  If you can’t answer that question do you wonder why the lenders won’t accept reasonable short sales?  Do you wonder why there are virtually no mortgage modifications being completed?  Read on and consider:

The tranche structure of the entire pool has numerous “credit enhancements” which layer the risk from bottom to top. Once a lower level dies out the certificates then become dead and uncollectable.

If each of the lower level tranches die out and losses on those investments are claimed by the individuals would that loss claim with the IRS essentially wipe out percentages of the obligation as well?

If not why not?

These were tax exemption vehicles that were propped up through lies and negligence for the sake of the bankers.

When they fell apart the IRS let the bankers slide. What about the rest of America?

Would it be possible to file an FOIA with the IRS as to what losses have been claimed on the pools to verify if the debt has been wiped out?

My pool has taken about an 800M loss of the 2.3B total invested so would I not automatically be entitled to a 25% reduction in principle for the losses claimed?

How about the third party payments such as CDS contracts? That would continue the income stream as long as the ratings are below AAA for the Certificates while the servicer steals the house and the money from the REO liquidation.

I have read that under IRC 860 that since the pool is static and can only accept exact replacement mortgages, that the REO money is actually to be invested by the servicer or master servicer since to pay the entire balance down would void the REMIC status.

Would that mean that all of the loans that had servicing rights transferred to say JPM(I think they received servicing rights of about 468B in WAMU loans on top of the free 191B in owned loans) give JPM the right to the REO and proceeds while the tax payer backed Default Swaps keep the income stream going to the top level tranches.

Now maybe we can start to see why JPM and others have helped create LPS to keep the ugly theft machine rolling.

Oh and it helps when the FDIC gives you a 1.5-2B litigation slush fund to keep LPS churning out the fraud.

I wonder how much of that goes to the judicial campaign contributions?

I wouldn’t mind if I got a 1.5B dollar slush fund to fight back with. How ’bout you Matt? Think we could use that for a good legal team?

Maybe Obama would give us some TARP money that we could use to take care of his electorate?

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The cat is way out of the bag.  The lenders and banks that brought our country to the verge of collapse with fraud, misrepresentation and lies have now brought these same practices into local courtrooms.  Every day judges who sign foreclosure orders are confronted with legal pleadings that do not conform to the most basic requirements of professional standards, but who really cares about that…the real issue is that because the lenders cannot produce the evidence they need to proceed with their cases, they….produce the evidence they need to proceed with their cases.

I’ve previously posted about affidavit and assignment fraud..it comes in three areas:

1) False Affidavits of Service or False Affidavits That We Could Not Serve the Defendant. (See Sewer Service);

2)False Assignments of Mortgage (MERS assigns this Mortgage to Deutsche Bank who now has the right to foreclose);

3)False Affidavits of Amounts due and owing.

A Subpoena for Every Foreclosure!

Many times these documents are false on their face, but sometimes it takes a little digging to uncover the lies and misrepresentations….that’s where a subpoena comes in.  The following is text of a subpoena I use.  Next is a Motion to Strike Affidavit.  Now there are going to be foreclosures that are proper (such as when original lenders foreclose) but in virtually every other case (especially when a pretender lender is a Plaintiff), when pressed, you’re going to find that the evidence submitted to the court is filled with mistakes lies or outright misrepresentations.  Given what we’re learning about the scope of this problem…subpoenas should be dropped in every case for every fact witness, assignor, assignee and affiant. Please share results of your work with me!  Together we’ll take my beloved courts back.

SUBPOENA DUCES TECUM FOR RECORDS WITH DEPOSITION

STATE OF FLORIDA:

TO:

YOU ARE HEREBY COMMANDED to appear before a person authorized by law to take depositions at the law offices of MATTHEW D. WEIDNER, P.A., 1229 Central Avenue, St. Petersburg, Florida 33705, on MONTH DAY, 2010, for the taking of your deposition in this action and to have with you at the above time and place the following:

1.                  All books, papers, records, documents and other tangible things kept by LITTON LOAN SERVICING, LP concerning the transactions alleged in the complaint against Annabel E. Montgomery.

2.                  Any and all other books, papers, records, documents or tangible things that relate to HSBC BANK, USA, ASSOCIATION AS TRUSTEE FOR THE ACE SECURITIES CORPORATION HOME EQUITY LOAN TRUST, SERIES 2005-AG1, ASSET BACKED PASS-THROUGH CERTIFICATES’ claim against ANNABEL E. MONTGOMERY.

3.               All employment records that exist between Christopher Spradling and any employer who has employed Spradling within the last three years including current employers.

4.            All records that purport to give Christopher Spradling the authority to sign or execute any documents on behalf of any person or entity.

5.         All documents, records, books, evidence or instructions that you reviewed or relied upon in order to prepare the affidavit or assignment executed in this case.

These items will be inspected and may be copied at that time.  You will not be required to surrender the original items.  You have the right to object to the production pursuant to this subpoena at any time before production by giving written notice to the attorney whoose name appears on this subpoena.  You may condition the preparation of the copies upon the payment in advance of the reasonable cost of preparation.

If you fail to: (a) appear as specified, or (b) furnish the records instead of appearing as provided above; or (c) object to this subpoena you may be in contempt of Court. You are subpoenaed by the attorneys whose names appear on this subpoena, and unless excused from this subpoena by the attorney or the Court, you shall respond to this subpoena as directed.

DATED on XXXX X, 2010.

FOR THE COURT

Matthew D. Weidner, P.A.

1229 Central Avenue

St. Petersburg, FL 33705

By: ________________________________

Matthew D. Weidner

FBN: 0185957

Defendant’s Motion to Strike Affidavit of Christopher Spradling and for attorney’s fees and costs

COMES NOW, the Defendant Annabel E. Montgomery (hereinafter “Defendant”), by and through the undersigned counsel MATTHEW D. WEIDNER, and respectfully MOTIONS THIS COURT TO STRIKE AFFIDAVIT OF CHRISTOPHER SPADLING AND FOR ATTORNEY’S FEES AND COSTS, pursuant to Fla. R. Civ. Pro. 1.510, and in support thereof states as follows:

FACTS

1. This is an action for foreclosure of real property owned by the Defendant.
2. The named plaintiff in this case is HSBC BANK, USA, NATIONAL ASSOCATION, AS TRUSTEE FOR THE ACE SECURITIES CORPORATION HOME EQUITY TRUST, SERIES 2005-AG1, ASSET BACKED PASS-THROUGH CERTIFICATE (hereinafter “Plaintiff”).
3. On February 2, 2010 Plaintiff, by and through its counsel Florida Default Law Group, P.L. (hereinafter “Florida Default Law Group”), gave Notice of Filing of Affidavit as to Amounts Due and Owing and the accompanying Affidavit (hereinafter “Affidavit”).
4. The Affiant of the above-mention Affidavit was identified as Christopher Spradling (hereinafter “Spradling”).  Spradling identified himself as a “Foreclosure Manager” for LITTON LOAN SERVICING, LP (hereinafter “Litton”).  Litton, in turn, was identified as “the servicer of the loan…[Litton] is responsible for the collection of this loan transaction and pursuit of any delinquency in payments.”[1]
5. Spradling, based upon his personal knowledge, averred in the Affidavit that: (1) the Plaintiff or its assigns was owed a total of $408,809.30; (2) the Plaintiff was entitled to enforce the Note and Mortgage; and (3) Plaintiff was entitled to a judgment as a matter of law.[2] The Affidavit does not contain any mention as to who owes the Plaintiff the sum alleged save for one sentences line which cryptically state “[s]pecifically, I have personal knowledge of the facts regarding the sums which are due and owing to Plaintiff or its assigns pursuant to the Note and Mortgage which is the subject matter of the lawsuit” and a second which states “I am familiar with the books of account…concerning the transactions alleged in the Complaint.”[3] Emphasis added.
6. Nowhere in the Affidavit was either Litton or Spradling identified as either the Plaintiff or the Plaintiff’s authorized agent.
7. Upon information and belief, Litton is simply a “middleman” of sorts who is responsible for the transfer of funds between the various assignees of the underlying Mortgage and Note and has no knowledge of the underlying transactions between the Plaintiff and Defendant.
8. Upon information and belief, Spradling, as employee of Litton and not the Plaintiff, has no knowledge of the underlying transactions between the Plaintiff and Defendant.

LEGAL REASONING IN SUPPORT OF MOTION

1. I. Plaintiff Failed to Attach Documents Referred to in the Affidavit
   1. a. Failure to Attach Documents Violates Fla. Stat. §90.901 (1989)

Florida Statue §90.901 (1989) states, in pertinent part, that “[a]uthentication or identification of evidence is required as a condition precedent to its admissibility.”  The failure to authenticate documents referred to in affidavits renders the affiant incompetent to testify as to the matters referred to in the affidavit.  See Fla. R. Civ. Pro. 1.510(e) (which reads, in pertinent part, that “affidavits…shall show affirmatively that the affiant is competent to testify to the matters stated therein”); Zoda v. Hedden, 596 So. 2d 1225, 1226 (Fla. 2d DCA 1992) (holding, in part, that failure to attach certified copies of public records rendered affiant, who was not a custodian of said records, incompetent to testify to the matters stated in his affidavit as affiant was unable to authenticate the documents referred to therein.)

Here, Spradling affirmatively states in the Affidavit that he is “familiar with the books of account and have examined all books, records, and documents kept by LITTON LOAN SERVICING, LP concerning the transactions alleged in the Complaint.”[4] Furthermore, Spradling averred that the “Plaintiff or its assigns, is owed…$408,809.30.”[5] Nevertheless, Spradling has failed to attach any of the books, records or documents referred to in the Affidavit.  In addition, Spradling does not meet the definition of “custodian,” which is “a person or institution that has charge or custody (of…papers).”  See Black’s Law Dictionary, 8th ed. 2004, custodian.  By Spradling’s own admission “[t]he books, records, and documents which [Spradling] has examined are managed by employees or agents whose duty it is to keep the books accurately and completely.”[6] Emphasis added.  Thus, Spradling has only examined the books, records, and documents which he refers to in the Affidavit while the true custodians of these documents are the employees or agents whose duty it is to keep the books accurately and completely.  In essence, Spradling averred to records which he did not submit nor could he testify for the authenticity of just as the affiant in Zoda did.

Spradling’s failure to attach the documents referred to in the Affidavit without being custodian of same is a violation of the authentication rule promulgated in Fla. Stat. §90.901 (1989), which renders him incompetent to testify to the matters stated therein as the Second District in Zoda held.  Therefore, the Affidavit should be struck in whole.

1. b. Failure to Attach Documents Violates Fla. R. Civ. Pro. 1.510(e)

Fla. R. Civ. Pro. 1.510(e) provides, in part, that “[s]worn or certified copies of all papers or parts thereof referred to in an affidavit shall be attached thereto or served therewith.”  Failure to attach such papers is grounds for reversal of summary judgment decisions.  See CSX Transp., Inc. v. Pasco County, 660 So. 2d 757 (Fla. 2d DCA 1995) (reversing summary judgment granted below where the affiant based statements on reports but failed to attach same to the affidavit.)

As previously demonstrated, Spradling referred to books, records, and documents kept by Litton which allegedly concerned the transaction referred to in the Complaint against the Defendant.  Nevertheless, as previously demonstrated, Spradling has not attached any of these books, records or documents.  This failure to do so is a violation of Fla. R. Civ. Pro. 1.510(e) and is grounds for a reversal of a summary judgment decision in favor of the Plaintiff.  Therefore, the Affidavit should be struck in whole.

1. II. Affidavit Was Not Based Upon Spradling’s Personal Knowledge

As a threshold matter, the admissibility of an affidavit rests upon the affiant having personal knowledge as to the matters stated therein.  See Fla. R. Civ. Pro. 1.510(e) (reading, in pertinent part, that “affidavits shall be made on personal knowledge”); Enterprise Leasing Co. v. Demartino, 15 So. 3d 711 (Fla. 2d DCA 2009); West Edge II v. Kunderas, 910 So. 2d 953 (Fla. 2d DCA 2005); In re Forefeiture of 1998 Ford Pickup, Identification No. 1FTZX1767WNA34547, 779 So. 2d 450 (Fla. 2d DCA 2000).  Additionally, a corporate officer’s affidavit which merely states conclusions or opinion is not sufficient, even if it is based on personal knowledge.  Nour v. All State Supply Co., So. 2d 1204, 1205 (Fla. 1st DCA 1986).

The Third District, in Alvarez v. Florida Ins. Guaranty Association, 661 So. 2d 1230 (Fla. 3d DCA 1995), noted that “the purpose of the personal knowledge requirement is to prevent the trial court from relying on hearsay when ruling on a motion for summary judgment and to ensure that there is an admissible evidentiary basis for the case rather than mere supposition or belief.”  Id at 1232 (quoting Pawlik v. Barnett Bank of Columbia County, 528 So. 2d 965, 966 (Fla. 1st DCA 1988)).  This opposition to hearsay evidence has deep roots in Florida common law.  In Capello v. Flea Market U.S.A., Inc., 625 So. 2d 474 (Fla. 3d DCA 1993), the Third District affirmed an order of summary judgment in favor of Flea Market U.S.A as Capello’s affidavit in opposition was not based upon personal knowledge and therefore contained inadmissible hearsay evidence.  See also Doss v. Steger & Steger, P.A., 613 So. 2d 136 (Fla. 4th DCA 1993); Mullan v. Bishop of Diocese of Orlando, 540 So. 2d 174 (Fla. 5th DCA 1989); Crosby v. Paxson Electric Company, 534 So. 2d 787 (Fla. 1st DCA 1988); Page v. Stanley, 226 So. 2d 129 (Fla. 4th DCA 1969).  Thus, there is ample precedent for striking affidavits in full which are not based upon the affiant’s personal knowledge.

Here, the entire Affidavit is hearsay evidence as Spradling has absolutely no personal knowledge of the facts stated therein.  As an employee of Litton, which purports to be the servicer of the loan, he has no knowledge of the underlying transaction between the Plaintiff and the Defendant.  Neither Spradling nor Litton: (1) were engaged by the Plaintiff for the purpose of executing the underlying mortgage transaction with the Defendant; or (2) had any contact with the Defendant with respect to the underlying transaction between the Plaintiff and Defendant.  In addition, the Affidavit fails to set forth with any degree of specificity what duties Litton performs for the Plaintiff, save for one line which states that Litton “is responsible for the collection of this loan transaction and pursuit of any delinquency in payments.”[7] At best, Litton acted as a middleman of sorts, whose primary function was to transfer of funds between the various assignees of the underlying Mortgage and Note.  Litton is not the named Plaintiff in this case, nor does the Affidavit aver that either Spradling or Litton is the agent of the Plaintiff.

Because Spradling has no personal knowledge of the underlying transaction between the Plaintiff and Defendant, any statement he gives which references this underlying transaction (such as the fact that the Plaintiff is allegedly owed sums of monies in excess of $400,000) is, by its very nature, hearsay.  The Florida Rules of Evidence define hearsay as “a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.”  Fla. Stat. §90.801(1)(c) (2007).  Here Spradling is averring to a statement (that the Plaintiff is allegedly owed sums of money) which was made by someone other than himself (namely, the Plaintiff) and is offering this as proof of the matter asserted (that Plaintiff is entitled to enforce the Note and Mortgage and that Plaintiff is entitled to a judgment as a matter of law.)  At best, the only statements which Spradling can aver to are those which regard the transfer of funds between the various assignees of the Mortgage and Note.

The Plaintiff may argue that while Spradling’s statements may be hearsay, they should nevertheless be admitted under the “Records of Regularly Conducted Business Activity” exception.  Fla. Stat. §90.803(6) (2007).  This rule provides that notwithstanding the provision of §90.802 (which renders hearsay statements inadmissible), hearsay statements are not inadmissible, even though the declarant is available as a witness, if the statement is

[a] memorandum, report, record, or data compilation, in any form, of acts, events, conditions, opinion, or diagnosis, made at or near the time by, or from information transmitted by, a person with knowledge, if kept in the course of a regularly conducted business activity and if it was the regular practice of that business activity to make such memorandum, report, record, or data compilation, all as shown by the testimony of the custodian or other qualified witness, or as shown by a certification or declaration that complies with paragraph (c) and s. 90.902(11), unless the sources of information or other circumstances show lack of trustworthiness.  Emphasis added.

There are, however, several problems with this argument.  To begin, and as previously demonstrated, no memorandums, reports, records, or data compilation have been offered by the Plaintiff.  Furthermore, the books, records, and documents referred to by Spradling in the Affidavit (which, of course, were not attached) were kept by Litton, who cannot be a person with knowledge as Litton does not have any personal knowledge of underlying transaction between the Plaintiff and the Defendant.  Finally, Litton, as the source of this information, shows a lack of trustworthiness because Spradling failed to attach the books, records, and documents to the Affidavit and because neither Litton nor Spradling have knowledge of the underlying transaction between the Plaintiff and the Defendant.

Because Spradling’s statements in the Affidavit are not based upon personal knowledge, they are inadmissible hearsay evidence.  As no hearsay exception applies to these statements, the Affidavit should be struck in whole.

1. III. Affidavit Included Impermissible Conclusions of Law Not Supported by Facts

An affidavit in support of a motion for summary judgment may not be based upon factual conclusions or opinions of law.  Jones Constr. Co. of Cent. Fla., Inc. v. Fla. Workers’ Comp. JUA, Inc., 793 So. 2d 978, 979 (Fla. 2d DCA 2001).  Furthermore, an affidavit which states a legal conclusion should not be relied upon unless the affidavit also recites the facts which justify the conclusion.  Acquadro v. Bergeron, 851 So. 2d 665, 672 (Fla. 2003); Rever v. Lapidus, 151 So. 2d 61, 62 (Fla. 3d DCA 1963).

Here, the Affidavit contained conclusions of law which were not supported by facts stated therein.  Specifically, Spradling averred that the Plaintiff was entitled to enforce the Note and Mortgage and that the Plaintiff was entitled to a judgment as a matter of law, two legal conclusions, but did not support this conclusion with statements which referenced exactly who the Plaintiff was entitled to enforce the Note and Mortgage against.  In fact there is no mention of any of the parties in question save for one cryptic line in where Spradling states that “[s]pecifically, I have personal knowledge of the facts regarding the sums which are due and owing to Plaintiff or its assigns pursuant to the Note and Mortgage which is the subject matter of the lawsuit” and another which states “I am familiar with the books of account…concerning the transactions alleged in the Complaint.”[8] Nowhere in the Affidavit does Spradling state that the Plaintiff is entitled to enforce the Note and Mortgage against the Defendant nor does Spradling state that the Plaintiff is entitled to a judgment as a matter of law because the Defendant owes the Plaintiff money.  At best the Affidavit accuses someone of owing the Plaintiff $408,809.30 and that the Plaintiff should be able to enforce some Note and Mortgage against that particular someone.  By not clearly identifying the parties in question, Spradling has not adequately supported his two legal conclusions.

Because the Affidavit contained impermissible conclusions of law which were not supported by facts stated therein, the Affidavit should be struck in whole.

1. IV. Sanction of Attorney’s Fees is Appropriate

Fla. R. Civ. Pro. 1.510(g) reads, in full, that

[i]f it appears to the satisfaction of the court at any time that any of the affidavits presented pursuant to this rule are presented in bad faith or solely for the purpose of delay, the court shall forthwith order the party employing them to pay to the other party the amount of the reasonable expenses which the filing of the affidavits caused the other party to incur, including reasonable attorneys’ fees, and any offending party or attorney may be adjudged guilty of contempt.  Emphasis added.

The undersigned counsel has expended considerable time and resources preparing to defend against an affidavit which has, on its face, no basis in law.  Both Florida Default Law Group and the Plaintiff both knew that Spradling’s affidavit lacked authenticity and reliability yet still chose to file it with the Court.  In addition, this is not Florida Default Law Group’s first time filing affidavits in bad faith.  Recently, the Bankruptcy Court for the Southern District of Florida sanctioned both Florida Default Law Group and its client, WELLS FARGO, $95,130.45 for false representations made in affidavits in that court as well as other bankruptcy courts in Florida.  See In re: Fazul Haque, Case No. 08-14257-BKR-JKO (Order Granting Wells Fargo, N.A.’s Motion for Relief from Stay and Imposing Sanctions for Negligent Practice and False Representations, Oct. 28, 2008).  This is indicia of a modus operandi on Florida Default Law Group’s part to present misrepresentations and false affidavits to the Court which make an award of attorney’s fees and costs an appropriate sanction.

WHEREFORE, Defendant asks this Court to GRANT its MOTION TO STRIKE AFFIDAVIT OF CHRISTOPHER SPRADLING and enter an ORDER granting ATTORNEY’S FEES AND COSTS and any other relief the Court deems just and proper.

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[1] See Affidavit As to Amounts Due and Owing, pg. 1.

[2] Id, pgs. 1, 2.

[3] Id.

[4] See Affidavit As to Amounts Due and Owing, pg. 1.

[5] Id, pg. 2.

[6] See Affidavit As to Amounts Due and Owing, pg. 1.

[7] See Affidavit As to Amounts Due and Owing, pg. 1.

[8] See Affidavit As to Amounts Due and Owing, pg. 1.

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