I was keeping track of the number of Sheriff's Sales stopped, but I decided that this gave the wrong impression to viewers. An attorney should not be consulted as a matter of last resort. Instead an attorney should be consulted early in the process and the sooner an attorney is consulted the more likely a Homeowner will have a favorable result

The Law Office of Bruce M. Broyles

5815 Market Street, Suite 2, Boardman, Ohio 44512

Phone: (330) 965-1093 Fax: (330) 953-0450

The Ohio Rules of Professional Conduct suggest that the reader be informed that one of the purposes of this blog is to attract potential clients, and therefore should be considered attorney advertisement

Tuesday, September 29, 2015

Anh Nguyet Tran vs. Bank of New York Petition for Writ of Certiorari

An amended complaint asserting a RICO action against REMIC trusts was dismissed on the grounds that Plaintiffs lacked standing to assert the failure to comply with the Trust's pooling and servicing agreement.  The writ asserts that a split exists within the U.S. Circuits on the issue of Plaintiffs' standing.  The Second Circuit held that Plaintiffs lacked standing to challenge the validity of the assignment.  The First Circuit in Culhane v. Aurora Loan Services of Nebraska, 708 F.3d 282 (1st Cir.2013) held that Plaintiffs have standing to challenge the validity of the assignment.

Both Anh Nguyet Tran and Culhane address the issue of whether Plaintiffs have standing to challenge the validity of an assignment.  However, rather than determining only the threshold issue that Plaintiffs have standing to challenge the validity of the assignment as in Culhane, the Court in Anh Nguyet Tran addressed the merits of the challenge to the validity of the assignment.  In Culhane, the Court determined that if the Plaintiff's challenge was correct the foreclosure would be void.  As such, Culhane found the Plaintiffs had standing, but then determined that the Plaintiffs' challenge to MERS involvement in the transaction did not render the assignment void.  In Anh Nguyet Tran, the Court determined that Plaintiffs' lacked standing to challenge the validity of the assignment based upon the Court's determination of the merits.  In Anh Nguyet Tran, the Court determined that the challenge to the validity of the assignment would not succeed and therefore determined that Plaintiffs lacked standing.

One of the main issues is whether the failure to comply with the Trust's governing documents renders the transaction void or merely voidable.  If the promissory note and mortgage are transferred after the closing date, and in a manner not described by the Pooling and Servicing Agreement, then the terms of the Pooling and Servicing agreement are violated.  The majority of these trusts are governed by New York Law. The New York Law of Estates, Powers and Trusts, N.Y. EPT. LAW § 7-2.4, states:

If the trust is expressed in the instrument creating the estate of the trustee, every sale, conveyance or other act of the trustee in contravention of the trust, except as authorized by this article and by any other provision of law, is void.

The Second Circuit relied upon standard Trust Law and determined that the beneficiaries could ratify invalid acts of the Trustee.  If the invalid acts could be ratified, then these transactions were merely voidable, not void.  A voidable transaction does not give Plaintiff mortgagors standing to challenge the validity of the assignment.

The problem in Anh Nguyet Tran is that the Court addresses the merits of the case upon a motion to dismiss based upon the threshold issue of standing.  There has been no discovery and no argument presented on the issue upon which the Court ultimately determined the case; whether the beneficiaries could ratify the invalid act of the Trustee.  Generally speaking, it is true that beneficiaries can ratify the invalid acts of the Trustee.  However, in mortgage securitization the Courts are dealing with REMIC Trusts, and these Trusts have provisions which prevent the Trustee from taking any action that would render the REMIC election invalid.  The invalid acts of a Trustee of a REMIC Trust cannot be ratified.  As such, these invalid transactions are void not merely voidable.

A similar battle is being fought in Ohio.  Homeowners are prevented from asserting challenges to the validity of the assignment based upon appellate court decisions that rely upon Bank of New York Mellon vs. Unger (Ohio App. 8th Dist.) 2012-Ohio-1950.  However, the Sixth Circuit has expressly stated that the federal cases relied upon by Unger are too broadly interpreted.  See, Alexander vs. Deutsche Bank National Trust Co. (N.D. Ohio West Dis.) Case No.: 3:12-CV-02704; and Slorp vs. Lerner Sampson & Rothfuss,
587 Fed.Appx. 249.  According to Alexander and Slorp Ohio Homeowners should be able to challenge the validity of assignments if the challenge would result in a void transaction.

Tuesday, July 28, 2015


I previously represented a client in a foreclosure case.  The client decided he no longer wanted to contest his foreclosure, and asked me to cease any further efforts.  Recently, the client contacted my office stating that he had a federal criminal matter in which the potential sentence was being greatly increased due to the Lender significantly increasing the amount it allegedly lost on a mortgage it foreclosed upon.  Through Attorney Jeff Barnes' network of attorneys and experts I was able to put my client in contact with Richard Kahn of FPG-USA.  Mr. Kahn worked on my client's report while away from his office on a previously scheduled trip; had the report to my client's criminal defense attorneys, and Mr. Kahn's report made a dramatic change in the outcome of the sentence.
See, the testimonial at the link below.!testimonials/c1yws

Sunday, June 28, 2015

Evidence of Ratification

The New York law of Trusts states expressly that transactions in violation of the Trust governing documents are void.  Most Courts do not analyze the  the trust documents and simply say that the mortgagor is not a party tovthe PSA and therefore cannot enforce the terms of the PSA.  Those Courts that do lookvfurther into the issue, eventually say that the beneficiaries can ratify the conduct of the Trustee and therefore the failure to comply with yhe PSA renders the transactions merely voidable.  However if one reads the PSA the PSA expressly prohibits the trust from taking any action that would render the trust subject to a tax or invalidate the REMiC.  As such yhe beneficiaries can not ratify these acts or transactions.  In yhe alternative,  shouldn't the Platiff trust be required ro demonstrate thst the beneficiaries actually ratified the act or transaction.

Friday, November 7, 2014

Rolling Stones Article on JPMorgan Chase I normally do not repost articles, but the above article gives some in depth information about the information that JPMorgan Chase's management was telling Congress. While the article has little to do with Homeowners Facing Foreclosure, it does demonstrate the depth to which Lenders will go to seek profits. JPMorgan Chase's management was also before a Congressional hearing discussing loan modifications and the moral hazard of principle reductions. First, how "moral" does this guy appear now? Second, the "principle" that would have been reduced is simply recapitalized late fees, interest, legal fees, inspection fees, forced placed insurance fees. Suddenly, the "moral" hazard disappeared when JPMorgan Chase could use these accounting gimmics of "consumer assistance" to obtain huge credits towards the fines that were imposed.

Friday, October 10, 2014

Home Owners Facing Foreclosure do not be discouraged by Bank of America vs. Kuchta

Again I have not read the entire opinion of Bank of America vs. Kuchta. My first blush gut reaction was to be somewhat discouraged, but this decision does not in any way signal the end of Home Owners Facing Foreclosure's ability to defend the action. It should signal thosecin litigation to seek professional assistance early. In many of the recent appellate decisions, the Courts are paying closercattntion to the finer points. Was the affidavit proper? Did the lender comply with the conditions precedent? In addition, I have noticed more Homeowners receiving better loan modifications regardless of the stage of the litigation. In addition, new guidelines regarding the prevention of a sale or proceeding to judgment while a loan modification is pending are being given more weight, at least by the Lenders. TrialmCourts were less almost hostile to a stay as a result of HAMP. The Magistrates would comment that HAMP only had guidelines bug no Federal Regulations. Being able to point to new fede regulations appears to have cauht the attention of the trial courts. do not be discouraged by the Kuchta decision. Yes, the financial industry will not be toppled by the gridlock causedby void foreclosures. Therecwill be no rrevolution. However, courts are beginning tk treat foreclosures as something more than a nuisance clogging the docket. In addition, banks are apparently growing weary of the fight. Banks are more apt to modify a loan than to draw an unreasonable line in the sand.

Wednesday, October 8, 2014

Ohio Supreme Court Issues Decision in Bank of America vs. Kuchta

I only recently received a copy of the slip opinion in Bank of America vs. Kuchta 2014-OHIO-4275, so I do not intend this to be an in depth analysis of the decision or its ramifications. I am writing to tell all Home Owners Facing Foreclosure that this decision will limit what an attorney can do for you after judgment has been rendered. Prior to the decision there was at least an issue as to whether a motion for relief judgment under Civil Rule 60(B) could be used to argue that the plaintiff lacked standing. In fact, prior to the decision, an argument could be made that a common law motion to vacate a void judgment could be made well after the judgment was rendered. The arguments centered upon whether the lack of standing resulted in a void judgment or merely a voidable judgment. At a glance, the decision appears to render lack of standing to be nothing more than a defense which must be asserted or it is waived. Again, I stated that I had not read the decision, so I do not want to try to analyze it here. However, this should be a WARNING to all Home Owners Facing Foreclosure, if you attempt to defend the foreclosure on your own an attorney attempting to asist you after judgment will be limited. Standing can only be challenged by a direct appeal. On appeal the attorney will be limited to the arguments and the evidence that were before the trial court. While there are still arguments available pursuant to Civil Rule 60(B), standing is no longer one of those arguments. In addition, many homeowners do not seek out an attorney until the Notice of Sheriff's Sale arrives. Plaintiffs are required to provide notice of Sheriff's Sale only a short period of time before the Sheriff's Sale. Plaintiff's have been delaying their request for an order of sale, and as a result, by the time many Home Owners Facing Foreclosure seek out the assistance of an attorney many of the grounds for relief under Civil Rule 60(B) are no longer available. Grounds under Civil Rule 60(B)(1)-(3) must be asserted within a reasonable period of time, and not beyond one year after judgment. As I have consistently stated, Home Owners Facing Foreclosure need to retain counsel early and defend the foreclosure in order to level the playing field in the loan modification process.

Thursday, May 29, 2014

Foreclosures Measures Near Pre-Crisis Levels/ Another Attack on Homeowners Facing Foreclosures

Browsing the internet I came across a story from Market Watch that stated essentially levels of foreclosures have returned to "near pre-crisis levels". Below is the link to the story, which includes a graph that creates a new statistic "completed foreclosures per mortgage". I believe this graph is deceptive.
First, the writer picks 2005 and declares that this is the pre-crisis numbers. This is sort of like saying gas prices have gone down, as long as no one remembers when gas was less than $2.00/ gallon. Second, the writer uses "completed foreclosures" to gauge the decline in Homeowners Facing Foreclosure. Who decides when a foreclosure is completed. Is it when the decree of foreclosure is filed, when the Sheriff Sale takes place, when the Sale is confirmed. If the writer chooses confirmed Sheriff Sales, then "completed foreclosures" becomes a relatively small number.
I went to the Ohio Supreme Court website and pulled the statistical reports for the Courts of Ohio. If you characterize 2005, as the writer did, "Pre-Crisis" the number of foreclosures that were filed in the State of Ohio was 63,996. The graph demonstrates that the height of the crisis was 2010. In Ohio, there were 85,483 new foreclosure complaints filed. In 2009, there were 89,053 new foreclosure complaints filed. The statistical reports for 2013 and 2014 are not available from the Ohio Supreme Court at this time. The graph has the numbers in 2012 demonstrating a significant decline and close to the "pre-crisis" 2005 numbers. In 2012, there were 70,469 new foreclosure filings. The writer of the Market Watch article could say in Ohio we are approaching the "Pre-crisis" numbers of 2005; or there has been a decline from the height of the crisis. However, what the numbers really show is that there were 70,469 homeowners who were far enough behind in their mortgage payments that the Bank resorted to foreclosure. This does not include those still struggling to keep current, or those who are behind but only 1 or 2 months behind. If you look at the new foreclosures filed in 1999, 31,229 foreclosure complaints were filed. I believe that 1999 would be a better year to consider as "pre-crisis" but the available reports on-line do not go back any further. In 2012, the number of new foreclosure cases was still nearly double the number of foreclosures in 1999.
My analysis of the numbers really provides no better gauge than the Market Watch article. Especially, if you have stumbled upon this article in search for assistance in defending a foreclosure. The purpose of my writing is to again explain to the Homeowner Facing Foreclosure that the Banks and National media are working against you to make you feel alone and hopeless. The Market Watch article is intended to keep the Homeowner Facing Foreclosure from seeking help, from fighting. Things are better for everyone but you. Even the recent stories of Homeowners prevailing against their lenders are clouded with bad news. The story was not about victories, but about secret non-disclosure agreements and how homeowners can be harmed in the future. The stories should be simple, those who fight usually get help. Those who fight usually end up with a reasonable monthly mortgage payment. Do not be misguided by the National Media, you are winning the battle and Banks are starting to offer reasonable deals for those who are willing to fight.