Wednesday, September 30, 2009

Ford County Confidential

There's an interesting and timely decision (Landmark National Bank v. Kesler) out of the Kansas Supreme Court that's worth a look for what it says about servicing agents and nominees where the underlying mortgage has been chopped, sliced, diced, pureed and sold off as some sort of financial smoothie to gullible 'investors'.

Kesler owned real estate in Ford County, Kansas secured by two mortgages-a $50,000 first with Landmark and a $ 93,100 second with Millennia Mortgage Co., both mortgages having been recorded in Ford County. Mortgage Electronic Registration Systems (MERS) was named as the nominee and Millenia as the creditor in the second mortgage, and Sovereign was a putative assignee of the Millennia second mortgage. (MERS functions as an electronic mortgage tracking system).

Kesler filed for bankruptcy in April, 2006, and Landmark filed a petition to foreclose its mortgage, naming Kesler and Millennia but not MERS or Sovereign. In the absence of answers the trial court entered a default judgment, and the property was sold at a sheriff's sale. Landmark filed a motion to confirm the sale on November 14, 2006.

Contemporaneously Sovereign filed a motion to set aside the default judgment and an answer asserting an interest as Millennia's assignee. It was said that MERS was a necessary party and because MERS did not receive service, Sovereign did not receive notice. MERS also filed a motion to set aside the default and a motion to intervene.

The trial court found that MERS was not a real party in interest; therefore Landmark was not required to name MERS as a party in its foreclosure petition. The court also found that MERS was only an agent or representative of Millennia. Sovereign had also failed to register its mortgage with the Ford County Registrar of Deeds, thus depriving itself of the right to intervene after judgment.

On appeal, the Kansas Supreme Court determined that the trial court was obliged to consider whether MERS would have had a meritorious defense if it had been named as a defendant and whether the outcome at a trial would have been different.

Because MERS was a nominee, its legal status depended on its relationship to its principal, Sovereign. The Court described that relationship to be that of a straw man. It had no stake in the outcome of the action as it did not function as a lender to Kesler and was in no sense an economic beneficiary. MERS did not demonstrate, and did not attempt to demonstrate that it possessed any interest in the mortgage beyond the bare designation as a mortgagor. It did not lend money or receive payment from the borrower, and it suffered no monetary loss as a consequence of the underlying litigation

Monday, September 28, 2009

Polanski's Life Achievement Award

Sometimes people start to believe their own propaganda, I think, and that's when they're headed for a fall.

Thus it is with this Polanski fellow, who fled California in 1977 ahead of sentencing for raping and sodomizing a thirteen year old girl after he'd plied her with quaalude. Since then he's been hiding out in France and has avoided a number of different places for fear of extradition.

Well. It appears that those fears were well founded, as Polanski decided to go to Switzerland to receive a Life Achievement award or something of an equally trivial nature.

Polanski forgot the First Lesson of Fugitives: sooner or later, you're going to let your guard down, and then you will be caught up by the law.

Shocking, they say. Raping a child is shocking, too-even in France.

I guess Polanski got his life achievement award, in the form of a Swiss jail cell.

The argument seems to be, Sparky, that he's been on the lam so long it'd be silly for him to be prosecuted, there's a new documentary that indicates that the judge was corrupt, the trial was a sham, the entire process was flawed, he's a great artist, the Americans are a bunch of prudes, he's 76 years old, and so on. All of these apologists seem to ignore one thing.

There is nothing funny or trivial about raping and sodomizing a child and using drugs to accomplish it .

I don't care who this guy is. Let him serve his time in a California prison and then deport him.

Photo courtesy of AP.

Monday, September 21, 2009

Promise 'em anything? Up to a point.

State v. Pies, no. 08-2033 (Iowa Ct. App. Sept. 17, 2009)

Pies was under suspicion for a burglary and police found some stolen property in his garbage. Pies agreed to come to the police station for a nice chat. Pies alleges that the inculpatory statements he made were the impermissible products of promises of leniency. During the recorded interview, Pies' confession was induced by improper promises of leniency in exchange for a confession.

The case was reversed and the confession was tossed.

In particular, things that were said included the following:

I am offering you an option to come clean and lessen the charge and work with us on this thing. At this point, if you choose not to cooperate we will take you, I will charge you with the full boat of the crime and you will suffer the consequences.

Folks, the lesson's clear. If a statement results from a promise of help or lenience, it is not voluntary, and is therefore inadmissible. One can, however, say that it is better to tell the truth, but that's about as far as it goes. If the suspect is told what advantages may accrue from a confession, the line has been crossed, because the statements then become promises or assurances.

The Numbskull's Lament, or, The Theory of Evolution Disproven

State v. Canal, no. 07-1051 (Iowa September 18, 2009)

Every once in a while you hear a story that is just stunning in the stupidity of the actors. I mean, we in the criminal law and justice professions probably see more of this than other folks but this one's over the top.

Canal, a high school student, sent two emails to a fourteen year old girl which followed the practice of so called 'sexting'-sending a text message with a photo of one's....ahem....attributes attached.

After being urged on by the 14 year old, the photos of Canal's tackle were sent.

Well. Mom was on the case monitoring the email, saw the photos, and they ended up in the hands of police. Canal was charged with disseminating obscene material to a minor, convicted, lost his deferred judgment and was required to register as a sex offender.

Canal appeals arguing that the evidence was insufficient to establish the emails and photos were obscene, and he blames his lawyer for ineffective assistance.

The Supreme Court held that a rational jury could find that the material was obscene as judged by its own community standards.