Be careful what you say about opposing counsel:
Gilberti v. Coppola, No. 12-1302 (1st Cir. 2/27/13).
District court's decision admonishing interested
party-attorney for unprofessional conduct in his representation of a junior mortgagor related to the
sale of the foreclosed property, is affirmed, where: 1) attorney's claim that opposing attorney
converted funds was never supported by any evidence; 2) attorney's allegation that
opposing attorney violated the criminal usury statute was frivolous; and 3) attorney turned
what seemed to be innocent misunderstandings into claims of perjury in his allegations
of false statements.
GILBERTI: Click here: USCA1 Opinion
Timing for challenge to lender's good faith and fair dealing:
Latson v. Plaza Home Mortgage, Inc., No. 12-1462 (1st Cir. 2/27/13).
Dismissal of plaintiffs' suit against defendant-mortgage
lender alleging state common law and statutory violations in making two house loans is
affirmed, where: 1) the good faith and fair dealing claim was properly dismissed because the
allegedly wrongful conduct all occurred before the contracts existed, not in violation of
their terms after formation, and the covenant only governs conduct of parties after they have
entered into a contract; and 2) the statutory claim is time-barred - the statute of limitations for a 93A action is four years, which had elapsed prior to suit.The specific allegations were that prior to closing Plaza failed to provide Latson with a proper commitment letter, good-faith estimate, or other documents
required by the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. §§
2601–2617, and gave them insufficient opportunity to review the terms of the
loans. They also claimed that Plaza either "knew or should have known" that an
appraisal of the property that the Latsons obtained at Plaza's request was "too
high." The Latsons asserted that all these acts and omissions were actionable
under both their common-law and statutory claims.
LATSON: Click
here: USCA1 Opinion
Challenge to IRS' "failure to pay" penalty fails:
Shafmaster: Click
here: USCA1 Opinion
In a case of first impression, mortgagor has standing to challenge assignment of mortgage if to do so renders the assignment void, rather than voidable:
Challenge to IRS' "failure to pay" penalty fails:
Shafmaster v. US, No. 12-1726 (1st Cir. 2/11/13).
Summary judgment was properly granted to defendant on
plaintiffs' claim for refund of a failure-to-pay penalty imposed on them by the Internal
Revenue Service, where: 1) equitable estoppel does not apply because plaintiffs fail to
allege affirmative misconduct on the part of defendant, and none of the documents promised
to waive the penalty, and some explicitly warned of the penalty, so there was no
definite misrepresentation of fact contained therein as to whether the penalty would be
assessed; 2) since plaintiffs did not show inability to pay or undue hardship, they cannot seek
refuge in the "reasonable cause" exception; and 3) plaintiff's arguments
regarding notice and demand all fail.
Alleged mortgagee needed to posses the "power of sale" at the time they foreclosed; thus mortgagor's questioning the the assignment did not take place prior to the foreclosure was proper; one who exercises power of sale must strictly follow its terms:
Juarez v. Select Portfolio Servicing, No. 11-2431 (1st Cir. 2/12/13):
Judgment dismissing complaint alleging defendants illegally
foreclosed on her home is reversed and remanded, where the complaint states plausible
claims for relief and that the district court abused its discretion in deciding that it would
be futile to allow an amendment to the complaint. Juarez properly alluded to a challenge that the assignment did not take place prior to the foreclosure thus, the foreclosing entity did not have the "power of sale" at the time they exercised it - which is a different challenge than a mortgagor's challenge to the validity of a third-party assignment. The issue of whether a "confirmatory assignment" cured the alleged defect was properly the subject of discovery and the complaint should have proceeded on that point. One who exercises the power of sale must strictly follow its terms. In this Massachusetts case, an assignment of the mortgage must take place before the foreclosure begins. Further, in light of this, the plaintiff should be allowed to amend and re-plead her fraud and Section 93A claims (Mass. Consumer Protection Statute). Massachusetts covenant of good faith and fair dealing is taken to be implied in
every contract, and provides "that neither party shall do anything
that will have the effect of destroying or injuring the right of the other party
to receive the fruits of the contract" - the
covenant only "governs conduct of parties after they have entered into a
contract.
Juarez: Click
here: USCA1 Opinion
Culhane v. Aurora Loan Services of Nebraska, No. 12-1285 (1st Cir. 2/15/13).
In a case of first impression, the court held that the mortgagor possesses standing to challenge the assignment of its mortgage to another entity. "Withal, a mortgagor does not have standing to challenge shortcomings in an
assignment that render it merely voidable at the election of one party but
otherwise effective to pass legal title." - thus, making the distinction that the challenge must be that the assignment is "void", rather than "voidable". Thus, here, the mortgagor (namely the borrower or home owner at issue) has standing to contest the validity of the
mortgage assignment made by Mortgage Electronic Registration Systems, Inc. (MERS), to
defendant, the foreclosing entity; however, the MERS framework and defendant's foreclosure of
plaintiff's property complied with the requirements of Massachusetts mortgage law, and
thus the foreclosure was lawful. Applying Massachusetts law, the court noted that in Massachusetts, the note and mortgage may be held by separate entities. Further, the terms of the mortgage (contract) authorized the transfer at issue.
"[I]n Massachusetts, a mortgagor has a legally cognizable right to challenge a foreclosing entity's status qua mortgagee. This may, in certain instances, require challenging the validity of an assignment that purports to transfer the mortgage to a successor mortgagee. Standing doctrine is meant to be a shield to protect the court from any role in the adjudication of disputes that do not measure up to a minimum set of adversarial requirements. There is no principled basis for employing standing doctrine as a sword to deprive mortgagors of legal protection conferred up them under state law. We hold, therefore, that a mortgagor has standing to challenge the assignment of a mortgage on her home to the extent tat such a challenge is necessary to context a foreclosing entity's status qua mortgagee. We caution that our hold, narrow to begin with, is further circumscribed. We hold only that a mortgagor has standing to challenge a mortgage assignment as invalid, ineffective, or void (if, say, the assignor had nothing to assign or had not authority to make an assignment to a particular assignee). If successful, a challenge of this sort would be sufficient to refute an assignee's status qua mortgagee . . . Withal, a mortgagor doe not have standing to challenge shortcomings in an assignment that render it merely voidable at the election of one party but otherwise effective to pass legal title."
Click
here: USCA1 Opinion
Discovery, Work-product & Waiver:
Discovery, Work-product & Waiver:
Walker v. NH AOC, 2013 DNH 025 (D.N.H.
2013)(Magistrate McCafferty)(court reviewed discovery materials in camera, and
determined many must be produced, articulating the parameters of work-product,
privilege and waiver).
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