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Opposition to Lift Stay

Opposition to Lift Stay

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Published by Javier Lopez-Perez

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Published by: Javier Lopez-Perez on Oct 27, 2011
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Jorge R. Bobadilla Aura M. Bobadilla 119 N. Prairie Avenue Inglewood, California 90301 Telephone: (310) 674-2717 In Pro Per

UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA LOS ANGELES DIVISION

In Re: Jorge R. Bobadilla Aura M. Bobadilla Debtors

) ) Case No.: 2:11-BK-41127-SK ) ) ) Chapter 7 ) ) MEMORANDUM OF POINTS AND ) AUTHORITIES IN SUPPORT OF ) DEBTORS’ OPPOSITION TO ) ) MOVANT BANK OF AMERICA, N.A., ) SUCCESSOR BY MERGER TO BAC ) HOME LOANS SERVICING LP, ) F/K/A COUNTRYWIDE HOME ) ) LOANS SERVICING LP’S MOTION ) FOR RELIEF FROM THE ) AUTOMATIC STAY ) ) ) Date: 10/18/2011 ) Time: 8:30 a.m. ) Room: 1575 ) Place: 255 E. Temple St., Los Angeles, CA 90012

Debtors Jorge R. and Aura M. Bobadilla (hereinafter the "Debtors"), submit this Memorandum of Points and Authorities in Opposition to Movant BANK OF AMERICA, N.A., SUCCESSOR BY MERGER TO BAC HOME LOANS SERVICING LP, F/K/A COUNTRYWIDE HOME LOANS SERVICING LP’s (hereinafter “Movant” or “BOA”) Motion for Relief from Automatic Stay (“Motion”).
_________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION - 1 -

BACKGROUND On July 21. in particular. Movant has filed a motion for relief from automatic stay for real property as the “Assignee of Holder of Deed of Trust” and has a pending Trustee Sale scheduled for November 4. 11-0006220.. Los Angeles. II. Section 362(d) provides that relief from stay shall be granted “on request of a party in interest. The substantive requirements are provided by 11 United States Code § 362(d). Los Angeles. and it is relatively broad: many parties are ‘parties in interest’ for the purposes of § 362(d). SUCCESSOR BY MERGER TO BAC HOME LOANS SERVICING LP. applicable by way of Federal Rules of Bankruptcy _________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION .A. Central District of California. Debtors continue in possession of the estate and. Rule 17(a)(1). DISCUSSION A.” § 362(d). on the other hand. Movant has acquired a void and fraudulently based Trustee's Deed. 2011 (“Petition Date”). The procedural requirements. are imposed by the United States Constitution and the Federal Rules of Bankruptcy Procedure. 2011.2 - . Debtor contests the Motion because Movant is not the Real Party in Interest. and because Movant’s non-judicial foreclosure action is illegal. But a party that seeks relief from stay must also be “the real party in interest” as required by Federal Rules of Civil Procedure. This is a substantive requirement. Debtors filed a chapter 7 proceeding in the United States Bankruptcy Court. Movant does not have standing. under trustee Sale No. the property located at 632 East Vernon Avenue. Movant relies on assignments (all) made contrary to law.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I. California 90011 (hereafter the “Property”). N. A motion for relief from the automatic stay must satisfy both substantive and procedural requirements. BANK OF AMERICA. F/K/A COUNTRYWIDE HOME LOANS SERVICING LP HAS NOT ESTABLISHED IT IS A REAL PARTY IN INTEREST BEFORE THIS BANKRUPTCY COURT.

v. U-Haul Int’l. and many others. v. Inc. Leverton”).3 - .” In contrast.2d 1136. Rule 9014 exceptions do not apply here. This Motion is a contested matter.’ Declarant Leverton simply states that he has “knowledge regarding [BANA]’s interest in the real property”. Inc. 1986).. Allstate Ins. according to the governing substantive law. is “Party in interest. 664 F. Although declarant Leverton incorporates by reference an Assignment of Deed of Trust signed by an entity known as Mortgage Electronic Registration System (“MERS”) as “nominee” for the original lender Countrywide Home Loans. the court is asked to merely rely upon the declaration of Jason Leverton (“Mr. officers of a corporation. 2004). (“BANA”). creditors. (“Countrywide”). 1141 (9th Cir. employees. 1094 (9th Cir. and at times.” A real party in interest is the party with the right to sue or enforce a claim under the applicable substantive law. The real party in interest is “the person who. Co.A. Rules 7017 (adversary proceedings). It includes the debtor. 358 F.. Rule 17. which never declares that the Movant is the ‘real party in interest. 1981). is entitled to enforce the right. Hughes.2d 1034. and is usually limited to a single party. which states in pertinent part “Every action shall be prosecuted in the name of the real party in interest.3d 1089.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Procedure. 1038 (9th Cir.” which generally in the bankruptcy context is anyone who is entitled to express a view with respect to a matter before the court. the assignment is by information and belief (i) unrecorded in the _________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION . v. Inc. “Assistant Vice President” for Bank of America N. and 9014 (contested matters). In this case. Inc. 793 F. Jartran. professionals active in the case.” The term “real party in interest” is easy to confuse with the term “party in interest. A “real party in interest” is a far narrower party. which means that the rules for adversary proceedings apply to contested matters. confusing. Nytco Services. Inc. including the incorporation of Federal Rules of Civil Procedure. American Triticale.

and (iii) was executed in favor of BANA two months after the Petition Date. (ii) has no legal effects until after recordation.4 - . BANA has not shown that it has ‘the right to sue or enforce a claim under the applicable substantive law. the purpose of relief from automatic stay is to get permission from this court to return to the status quo in order to presumably continue the foreclosure. the object of a non-judicial foreclosure is to sell a property in order to satisfy an underlying defaulted loan. (1872) (“the note and mortgage are inseparable…. Absent a declaration by a percipient witness. Movant has not even provided documentation to sustain the acquisition of Countrywide by BAC Home Loans Servicing LP. 83 U. who has not established before the Honorable Court through its own documentation. while an _________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION . Asset-Backed Certificates Series 2006-17. F/K/A COUNTRYWIDE HOME LOANS SERVICING LP CANNOT ESTABLISHED IT HAD THE RIGHT TO FORECLOSE. initiated non-judicial foreclosure of the Property.S. the Notice of Default specified that the amounts allegedly owed to the lender should be paid to an entity named Deutsche Bank National Trust Company. 274.A. and its subsequent merger to BANA. SUCCESSOR BY MERGER TO BAC HOME LOANS SERVICING LP. In any event.” To add to the confusion. in January of 2011. Reconstruct Company N. 271. See Exhibit I.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Recorder’s Office of Los Angeles County. that Movant is the real party in interest. Carpenter v. N. (“Reconstruct” or “Trustee”). the truth of the matter is that when the named trustee. Leverton’s declaration attached to the motion for relief.A. against the bankruptcy estate and the Debtor’s estate. In fact. percipient or otherwise. the assignment of the note carries the mortgage with it. in this case. A longstanding and unchanged bedrock principle in American jurisprudence holds that a mortgagee has no rights without the note. BANK OF AMERICA. that it is the “real party in interest.’ B. Whereas. CONVEY TO ITSELF THE TRUSTEE’S DEED. OR TO PROSECUTE THE UNLAWFUL DETAINER ACTION AND TO PROSECUTE THE MOTION FOR RELIEF FROM STAY. Longan. See Exhibit C of Mr. as Trustee for GSAA Home Equity Trust 2006-17..

. did not attempt to demonstrate. (“MERS is not a mortgagee… because it has no enforceable right in the debt obligation securing the mortgage. Landmark Nat. in fact. A Married Woman”. Registration System..”. Reconstruct.. Bank v.A.. 216 P..3d 1 (Ark. Mortgage Elec.”).A. “as agent” of the Trustee. listed the Trustee as “Reconstruct Company.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 assignment of the latter alone is a nullity.W. N.A. LandSafe Title of California.1 In the present case.169 (Kan. Southwest Homes of Arkansas. 152.5 - . 2006. and states: RECONSTRUCT COMPANY. to secure certain obligations in favor of MORTGAGE ELECTRONIC REGISTRATION SYSTEMS. and listed “MERS" as both a "corporation that is acting solely as a nominee for Lender and Lender's successors and assigns" while concurrently stating "MERS is the beneficiary under this Security Instrument.”). By: LandSafe Title of California. 2010). is a mortgagee has concluded that Defendant MERS IS NOT a mortgagee or deed of trust beneficiary. Inc. Inc. Inc. as agent for the Beneficiary. MERS. The Notice of Default for the Property was recorded on January 27. Slip op. The Notice of Default is purportedly signed by a new entity. as beneficiary recorded 09/06/2006.”." A true and correct copy of the Deed of Trust is attached to the motion for relief of stay as Exhibit A. Inc. A MARRIED WOMAN AS HER SOLE AND SEPARATE PROPERTY as Trustor. 301 S. that it possessed any tangible interest in the mortgage beyond a nominal designation. N. INC. Saunders.”)..3d 158. 2009 Ark.. v. It listed the borrower as “Aura Bobadilla. Kesler. as Agent… A true and correct copy of the Notice of Default is attached by reference as Exhibit 1 to this Memorandum. listed the Lender as “Countrywide Home Loans. Inc. N. 2009) (“MERS did not demonstrate. the Deed of Trust for the Property (pre-Trustee's Deed) was recorded on September 6. even though it is so designated in the deed of trust.”) To date. executed by AURA BOBADILLA. 1 _________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION . Said obligation including ONE NOTE FOR THE ORIGINAL… RECONSTRUCT COMPANY. at ¶ 1 (August 12. 2010 ME 79. v. every state Supreme Court that has looked at the issue of whether Mortgage Electronic Systems Registration. 2009) (The Chief Justice writing that MERS had no property rights and “MERS is not the beneficiary. is acting as an agent for the Beneficiary under a Deed of Trust dated 08/28/2006. Inc. 2011.

1. which is to say an owner of the real property’s right to foreclose upon the security interest. A true and correct copy of the County of Los Angeles Index results is attached by reference as Exhibit 2 to this Memorandum. Two Faces: Demystifying The Mortgage Electronic Registration System's Land Title Theory. Trusts and Estate Law Journal (fn.02). attorneys representing MERS frequently take inconsistent positions on the legal status of the company.a form of an agent. More importantly. It is axiomatic that a company cannot be both an agent and a principal with respect to the same right.Forthcoming Real Property. 19 citing Restatement (Third) of Agency Law §§1. or some other form of agency instead of the actual owner of the interest in land. Countrywide. post-petition September 7. to use the name of a shell company. This leaves us with MERS. which also never assigned any interest. to anyone. On the other hand. 2011 Assignment of the Deed of Trust attached to the motion for relief of stay as Exhibit C. there is no statute or rule authorizing the same in the context of bankruptcy allowing a nominee to become the real party in interest. (9/29/10) MERS II Working Draft . while an assignment of Countrywide’s interest to any other Lender is non-existent.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 In addition. In litigation all across the country. depending on the legal issue at hand.01. a search of the County of Los Angeles Grantor / Grantee Index does not reflect any recording of a Notice of Sale or of an Assignment of Deed of Trust. In the non-recorded. Moreover. or that Debtor can locate that allows MERS. MERS assigns the original trust to BANA. it also is acting as an actual mortgagee. as can be readily ascertained from the aforementioned exhibit. nominee. There is no known statute that Movant has presented or relied upon. there is absolutely no assignment whatsoever by and between the original lender. _________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION . in the Assignment of the Deed of Trust MERS purports to be acting as a nominee for Countrywide .6 - . On the one hand. or any financial institution.

246 P. “An actual or threatened injury exists when a party's pecuniary interest may be affected by the outcome of a determination. C. 1339 (9th Cir. 2007). Upshaw. Little Joe Trawlers. two are of particular relevance to a party who invokes a court’s authority to grant relief from the automatic stay under 11 U. Longan. then both MERS. 127 S. Freedom Religion Found. SUCCESSOR BY MERGER TO BAC HOME LOANS SERVICING LP. at 668 (citing United States v. 147 B.2d 424 (2007)). --.. 271.3 To seek relief in federal court. v. BANK OF AMERICA. 1986). Movant cannot establish a right to foreclose. and more importantly.S. at 668 (citing Valley Forge. at 668 (Bankr.Y.Ct. 1996).” Morrow. Valley Forge Christian Coll. 161 (1st Cir. and redressability inquiries. Kelley v.2d 179. 194 B.7 - . if MERS is an actual mortgagee. ----. 859. 192. 499 F. see also Morrow v. 274 (1872).R.. United for Separation of Church and State.R. a party Article III of the Constitution limits the judicial power of the United States to the resolution of cases and controversies.2d 23 (1952). at 668-69. 1992).N. and under this umbrella of ambiguity – to put it mildly. In re Leisure Time Sports. that the injury be “fairly traceable to the defendant’s allegedly unlawful conduct and likely to be redressed by the requested relief.C.” In re Village Rathskeller.R.” Id. Inc. This constitutional restriction is enforced by the minimum requirement that a “party who invokes the court’s authority…show that he suffered some actual or threatened injury. § 362(d). 499 F. traceability.S. Inc. Ams.” Matter of Village Rathskeller.3d 1332.2 The “real party in interest” requirement. 3 Of these considerations.3d at 1339 (citing Hein v.A.” Matter of Village Rathskeller..1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 In arguendo. Inc.. Not one of the aforementioned exhibits presents one assignment or presents any continuity of who owns what. See id.S. 147 B. 83 U. Carpenter v. and financial institutions investing in MERS recorded mortgages run afoul of century-old American jurisprudence that holds that the note and mortgage are inseparable. that Movant has the right to seek the Motion before the court. grounded in Article III.S. 168 L. 780 F. F/K/A COUNTRYWIDE HOME LOANS SERVICING LP LACKS STANDING. N. the party seeking relief 2 _________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION . First. Standing is constitutional requirement. at 464).R. In short. S.Ed. It is also important to distinguish the “real party in interest” requirement from standing.U. Microsoft Corp.. 2555-56. it may have authority to record mortgages in its own name. 665. 2553. 464. “These requirements have been described as the injury in fact. 39 Cal. (1982). Inc. 147 B.S. MERS holds absolutely no beneficial interests in Debtor’s mortgage.2d 158.D. 861 (9th Cir. 484. 454 U. is generally regarded as one of many “prudential” considerations that have been “judicially engrafted onto the Article III requirements for standing. on the other hand. 454 U.

v. Microsoft Corp. 454 U. Carolina Environmental Study Group. See. at 475 (citing Association of Data Processing Service Orgs. Wulff. 397 U. SUCCESSOR BY MERGER TO BAC HOME LOANS SERVICING LP. e.. As set forth in this opposition. 499 F. Yageo Corp. Realtors v. Camp. and thus. the power is part of the security and vest in any person who by assignment becomes entitled to payment of the money secured by the instrument. Abell. at 760 (citing Warth v. Inc. as set forth in the aforementioned exhibits has been an assignee. 441 U.8 - . 1999). 59. The power of sale may be exercised by the assignee if the assignment is duly acknowledged and recorded. _________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION . 672 (D. 481 F... Gladstone. Movant is not a real party in interest.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 “must meet both constitutional and prudential . 2006. N. Conversely. v. . 91. 171 F.. Duke Power Co. AS A MATTER OF LAW.S. 454 U. D. had an “must assert his own legal rights and interests. Singleton v.” Morrow v. F/K/A COUNTRYWIDE HOME LOANS SERVICING LP FAILED TO COMPLY WITH CALIFORNIA FORECLOSURE LAWS MAKING THE TRUSTEE’S DEED VOID. 147 B.g. 498 (1975) for the proposition that “[t]he concept of standing subsumes a blend of constitutional requirements and prudential considerations”). 441 U.S. and cannot rest his claim to relief on the legal rights or interests of third parties. Both of these considerations are incorporated into Rule 17’s requirement that an action be prosecuted “in the name of the real party in interest. 1339 (9th Cir. Whelan v..2d 663. 2007).3d 315. California Civil Code § 2932. a party may be the real party in interest. at 80). 113-114 (1976)). 490. Duke Power Co. let alone. 320 (5th Cir. . 428 U.S. 953 F.g. 438 U. nor an assignee. 100 (1979) (emphasis supplied). 501 (1975). Cody Resources.C. Inc. Seldin. nor authorized to foreclose.S. see also In re Village Rathskeller.S... Second. Dir. has no standing. “the plaintiff's complaint [must] fall within ‘the zone of interests to be protected or regulated by the statute or constitutional guarantee in question. Seldin. No party. or other encumbrancer.” See Ensley v. at 668 (citing Warth v.” Valley Forge.R. 422 U. 1992).3d 661 (9th Cir. 150.5 provides: Where a power to sell real property is given to a mortgage. To satisfy one does not necessarily mean that the other is satisfied: a party may have standing – having suffered an “injury in fact” – but this may not make it the real party in interest. See. requirements.A.’” Valley Forge. 106. 438 U.. in an instrument intended to secure the payment of money. 153 (1970). Gladstone.3d 1332. 2007).S. the only recording made was the Deed of Trust for the Property on September 6.S. Davis v.S.S. but lack standing. Village of Bellwood. at 100. In this case. 80 (1978). 422 U.S. 490. e. Inc. BANK OF AMERICA.

THEREFORE.9 - .1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 assignment recorded. Debtors respectfully request the Honorable Court to deny BANA’s motion for relief of stay in the case of caption. Bobadilla _________________________________________________________________________________________________ MEMORANDUM IN OPPOSITION TO RELIEF FROM AUTOMATIC STAY MOTION . CONCLUSION For the reasons set forth above. 2011 By: _______________________________ Jorge R. The only recording is the Deed of Trust indicating Countrywide as the Lender.5. the court should deny Movant’s motion. The power of sale is void because it was never exercised pursuant to § 2932. DATED: October 6. E. Bobadilla By: _____________________________ Aura M.

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