We. Won. …. Twice!!!
Thank you to any of you who already were keeping up on the results of my recent Supreme Court Oral Arguments. I appreciate it. I’m late in reporting, but happy to report, that both arguments went over well with the Court and we….dun dun dun…. won both appeals!!! Here’s the details for the foreclosure case (the criminal case results will be the subject of my next blog post):
JBNC vs Namahoe - Wrongful Foreclosure Case
Elton Namahoe - Borrower (pc: Civil Beat)
Factual Summary: In this case, JBNC, a predatory purveyor of reverse mortgages, foreclosed on an elderly borrower named Namahoe based on an alleged failure to make $500 worth of repairs to his carport. The case proceeded, but, due to dubious service of process on Namahoe, he failed to defend the lawsuit and eventually a summary judgment of foreclosure was issued to JBNC. After the case ended, Will Rosdil was hired by Namahoe to try to unwind the proceedings. He argued, among other things, that JBNC and its attorneys had committed fraud on the court where they had 1) failed to disclose the details of the foreclosure to the judge ($500 repairs vs losing a $200k+ home), and 2) failed to disclose that they did not fully comply with HUD regulations precedent to foreclosure.
Justice Nakayama (foreground); Justice Recktenwald (background) (pc: Civil Beat)
The Decision: The Supreme Court, in a unanimous decision, found that JBNC and its attorneys did in fact commit fraud on the Court. (“Despite the high threshold for a finding of fraud on the court, we find that JBNC committed fraud on the court in pursuit of this foreclosure against Namahoe.” - Justice Recktenwald, Opinion at page 40.). We win!!!
What is Next: The Court ruled that “the circuit court’s denial of Namahoe’s [ ]motion [for relief] is [ ] reversed, and the Decree of Foreclosure is vacated insofar as it would preclude Namahoe from asserting a wrongful foreclosure claim.” Opinion, page 49. This means that the foreclosure goes back to its pre-summary-judgment ruling stage so that Namahoe can defend against. Also, it means Namahoe’s separate lawsuit against JBNC and its attorneys for wrongful foreclosure can proceed once again as well. Those cases are now pending again before the lower court.
Will Rosdil - Attorney Hired to Unwind the Bogus Foreclosure (pc: Civil Beat)
What this Means for Borrowers and Lenders: Courts across the nation, but especially in Hawaii, have recognized for years that foreclosing lenders often employ predatory practices. As a result, protections for borrowers have routinely been extended. This case furthers that practice. It iterates and clarifies that a lender must strictly adhere to all contractual and legal (statutory and case law) prerequisites to foreclosure. Most importantly, however, it again recognizes that the foreclosing attorney is also held to this same standard and the attorney must certify to the Court the lender’s compliance. Finally, this case shows that where the practices are especially egregious and/or predatory, relief for a borrower can be gained even well after the fact of the foreclosure.
Also, special thanks to John Hill at Civil Beat for his fabulous article covering the story. You can find it here.
If you would like to read the full Supreme Court opinion, you can find that here.