February 15, 2011 FDN attorneys Jeff Barnes, Esq. and Ronald Grant, Esq. have successfully stopped a foreclosure sale in Hawai’i, obtaining a temporary restraining order against the sale with the order being continued for a period of months. The case now proceeds to discovery. Papers were drafted by Mr. Barnes and court action was undertaken by Mr. Grant. Mr. Barnes will be applying for admission to the Hawaii court pro hac vice. Separately, attorneys have filed a Petition in the United States Supreme Court to challenge the constitutionality of Hawai’i’s nonjudicial foreclosure scheme, which is based on laws enacted in 1874. The scheme is being criticized as not providing proper due process for borrowers to challenge a nonjudicial foreclosure. In our view, similar challenges should be mounted in all of the nonjudicial states. The nonjudicial foreclosure procedures, when enacted, never could have contemplated or imagined and are thus not designed to handle complicated legal and factual foreclosure issues such as securitization and MERS. Part of the problem lies with the fact that most of the trust deed acts define “beneficiary” as the party for whose benefit the deed of trust is given (that being the party which was the real lender), yet some courts have nonetheless permitted MERS to be the “beneficiary” despite the undisputed fact that MERS never lent any money or extended any credit. This unsettled nature of this area of the law was just highlighted again in the February 11, 2011 decision from the United States Bankruptcy Court for the Southern District of New York in the matter of In Re Agard, Case No. 810-77338-reg, where the Court derailed MERS’ purported authority to transfer anything and held that MERS’ “nominee” status “and the rights bestowed upon MERS within the mortgage itself are insufficient to empower MERS to effectuate a valid assignment of mortgage”. The court cited many recent NY decisions which are in accord, as well as the Kansas and Arkansas cases we which have repeatedly discussed on this website.
Make big money in penny stocks today