Glaski vs Bank of America NA et al – FOR PUBLICATION

Glaski vs Bank of America NA et al – FOR PUBLICATION

Edstrom_MortgageSecuritization_POSTER_17_x_22_v4_1By Daniel Edstrom
DTC Systems, Inc.

On August 8, 2013 the Fifth Appellate District in the Court of Appeal of the State of California ordered the Thomas A. Glaski vs Bank of America, NA et al decision published, stating:



As the nonpublished opinion filed on July 31, 2013, in the above entitled matter hereby meets the standards for publication specified in the California Rules of Court, rule 8.1105(c), it is ordered that the opinion be certified for publication in the Official Reports.

Based on the importance of this case, the text of the July 31, 2013 ruling is listed verbatim:



THOMAS A. GLASKI,Plaintiff and Appellant,v.


Defendants and Respondents.


(Super. Ct. No. 09CECG03601)



APPEAL from a judgment of the Superior Court of Fresno County.  Alan M. Simpson, Judge.

Law Offices of Richard L. Antognini and Richard L. Antognini; Law Offices of Catarina M. Benitez and Catarina M. Benitez, for Plaintiff and Appellant.

AlvaradoSmith, Theodore E. Bacon, and Mikel A. Glavinovich, for Defendants and Respondents.



            Before Washington Mutual Bank, FA (WaMu) was seized by federal banking regulators in 2008, it made many residential real estate loans and used those loans as collateral for mortgage-backed securities.[1]  Many of the loans went into default, which led to nonjudicial foreclosure proceedings.  Some of the foreclosures generated lawsuits, which raised a wide variety of claims.  The allegations that the instant case shares with some of the other lawsuits are that (1) documents related to the foreclosure contained forged signatures of Deborah Brignac and (2) the foreclosing entity was not the true owner of the loan because its chain of ownership had been broken by a defective transfer of the loan to the securitized trust established for the mortgage-backed securities.  Here, the specific defect alleged is that the attempted transfers were made after the closing date of the securitized trust holding the pooled mortgages and therefore the transfers were ineffective.

In this appeal, the borrower contends the trial court erred by sustaining defendants’ demurrer as to all of his causes of action attacking the nonjudicial foreclosure.  We conclude that, although the borrower’s allegations are somewhat confusing and may contain contradictions, he nonetheless has stated a wrongful foreclosure claim under the lenient standards applied to demurrers.  We conclude that a borrower may challenge the securitized trust’s chain of ownership by alleging the attempts to transfer the deed of trust to the securitized trust (which was formed under New York law) occurred after the trust’s closing date.  Transfers that violate the terms of the trust instrument are void under New York trust law, and borrowers have standing to challenge void assignments of their loans even though they are not a party to, or a third party beneficiary of, the assignment agreement.

We therefore reverse the judgment of dismissal and remand for further proceedings.

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Ninth Circuit Appeals Court Ruling for Hawaii – Foreclosure Sale Avoided for Lack of Public Announcement

Ninth Circuit Appeals Court Ruling for Hawaii – Foreclosure Sale Avoided for Lack of Public Announcement

By Daniel Edstrom
DTC Systems, Inc.

Thanks to Deontos for this one.  The bankruptcy court ruled the foreclosure was invalid.  The Bankruptcy Appellate Panel reversed.  The US Court of Appeals for the Ninth Circuit affirms “the bankruptcy court’s avoidance of the foreclosure sale.”  This ruling is FOR PUBLICATION.


We hold that (1) the lack of public announcement did violate Hawaii’s nonjudicial foreclosure statute, and (2) this defect was a deceptive practice under state law. Accordingly, we affirm the bankruptcy court’s avoidance of the foreclosure sale. However, we remand to the bankruptcy court for a proper calculation of attorneys’ fees and damages under HRS § 480-13.

Download the ruling here:

An Excellent Unconscionability, Adhesion, Rescission, Unenforceability and Arbitration Appeals Court Case

Edstrom_MortgageSecuritization_POSTER_17_x_22_v4_1An Excellent Unconscionability, Adhesion, Rescission, Unenforceability and Arbitration Appeals Court Case

By Daniel Edstrom
DTC Systems, Inc.

This appeals court case, FOR PUBLICATION, provides an excellent discussion of unconscionable contract terms.  Although this case does not relate to mortgage loans, it does discuss this as a contractual issue.

Excerpt 1

Turning to the case at hand, we first address petitioners’ argument the mandatory arbitration provisions contained in their franchise agreements were unconscionable and therefore unenforceable. The doctrine of unconscionability is a judicially created doctrine which was codified in 1979 when the Legislature enacted Civil Code section 1670.5. (Armendariz v. Foundation Health Psychcare Services, Inc, supra, 24 Cal.4th at pp. 113-114.) That section provides in relevant part, “If the court as a matter of law finds the contract or any clause of the contract to have been unconscionable at the time it was made the court may refuse to enforce the contract . . . .” (Civ. Code, § 1670.5, subd. (a).) While the statute does not attempt to precisely define “unconscionable,” there is a large body of case law recognizing the term has “both a procedural and a substantive element, both of which must be present to render a contract unenforceable. [Citation.] The procedural element focuses on the unequal bargaining positions and hidden terms common in the context of adhesion contracts. [Citation.] While courts have defined the substantive element in various ways, it traditionally involves contract terms that are so one-sided as to ‘shock the conscience,’ or that impose harsh or oppressive terms. [Cit ation.]” (24 Hour Fitness, Inc. v. Superior Court (1998) 66 Cal.App. 4th 1199, 1212-1213.)
Both elements need not be present to the same degree. “[T]he more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.” (Armendariz v. Foundation Health Psychcare Services, Inc., supra, 24 Cal.4th at p. 114.) Additionally, a “claim of unconscionability often cannot be determined merely by examining the face of a contract, but will require inquiry into its [commercial] setting, purpose and effect.” (Perdue v. Crocker National Bank (1985) 38 Cal.3d 913, 926.) Continue reading “An Excellent Unconscionability, Adhesion, Rescission, Unenforceability and Arbitration Appeals Court Case”