Mandarin Foreclosure Defense Attorneys have argued, mostly unsuccessfully, that mortgage servicers should not be able to foreclose on homes when their standing is on behalf of a trust. In the alternative, the servicer can provide evidence of the trustee or agents' ratification - but this is the rare case. Instead, servicers have fallen into the bad habit of claiming authority to act on behalf of the trustee without providing any independent proof.
On April 4, 2012, the Florida Fourth District Court of Appeal handed down a case that supports the position that Mandarin Foreclosure Defense lawyers have been arguing with Elston/Leetsdate, LLC v. CW Capital Asset Management LLC, Case No. 4D11-3151 (Fla. 4th DCA 2012).
The court distinguished that, in the mortgage foreclosure context, standing is broader than simple ownership of the beneficial interest in the note and that a servicer may be considered a party in interest as long as the trustee joins or ratifies the action. In Elston, the caption of the verified complaint states the action was brought by CW Capital Asset Management, LLC "solely in its capacity as special servicer on behalf of U.S. Bank, N.A." CW simply alleged, and verified as true, that it had been authorized by the Trust to foreclose as agent and special servicer for the Trust. But CW did not file any evidence, affidavit or other documents, supporting this allegation. The Court noted that, although CW's complaint was verified, it was verified by the "SVP" for CW - not by the real party in interest, the trust. CW relied on nothing more than its own allegations and affidavit to support its argument that it had standing to sue on behalf of the trust. The Court held this evidence as insufficient to prove authorization to sue on a trust's behalf.
The Elston case is sure to add to Florida Foreclosure Defense Attorneys' resources. If you are in foreclosure in Mandarin, Florida, contact a Mandarin Foreclosure Defense Attorney.