Kansas Supreme Court Ruling Favors Homeowners in Foreclosre

The Web of Debt blog published by Attorney Ellen Hodgson Brown, on September 19th, published an article, LANDMARK DECISION PROMISES MASSIVE RELIEF FOR HOMEOWNERS AND TROUBLE FOR BANKS.

A landmark ruling in a recent Kansas Supreme Court case may have given millions of distressed homeowners the legal wedge they need to avoid foreclosure.

Hoorah, another major court rules in favor of justice and against illegal actions taken by the banks making a mockery of our court system.  “Two wrongs don’t make a right”.  You have heard me say that time and time again.  Yes, we may owe the money but delinquency in no way should allow blatant violation of the law especially by a bank or a bank owned corporation disguised as the federally insured bank that made you your loan.

In Landmark National Bank v. Kesler, 2009 Kan. LEXIS 834, the Kansas Supreme Court (emphasis added) held that a nominee company called MERS has no right or standing to bring an action for foreclosure. MERS is an acronym for Mortgage Electronic Registration Systems, a private company that registers mortgages electronically and tracks changes in ownership.

The significance of the holding is that if MERS has no standing to foreclose, then nobody has standing to foreclose – on 60 million mortgages. That is the number of American mortgages currently reported to be held by MERS. Over half of all new U.S. residential mortgage loans are registered with MERS and recorded in its name.

This is significant and while a Kansas ruling applies to Kansas it can set precedence in other states as well.

Ms. Brown says it well when she says, “Eliminating the “Straw Man” Shielding Lenders and Investors from Liability” is just what has happened.  You see, MERS was set up by the banks to further create a smoke screen for their sale of mortgages.  As Ms. Brown explains in the article;

The development of “electronic” mortgages managed by MERS went hand in hand with the “securitization” of mortgage loans – chopping them into pieces and selling them off to investors.
California attorney Timothy McCandless describes the problem like this:

“[MERS] has reduced transparency in the mortgage market in two ways. First, consumers and their counsel can no longer turn to the public recording systems to learn the identity of the holder of their note. Today, county recording systems are increasingly full of one meaningless name, MERS, repeated over and over again. But more importantly, all across the country, MERS now brings foreclosure proceedings in its own name – even though it is not the financial party in interest. This is problematic because MERS is not prepared for or equipped to provide responses to consumers’ discovery requests with respect to predatory lending claims and defenses. In effect, the securitization conduit attempts to use a faceless and seemingly innocent proxy with no knowledge of predatory origination or servicing behavior to do the dirty work of seizing the consumer’s home. . . . So imposing is this opaque corporate wall, that in a “vast” number of foreclosures, MERS actually succeeds in foreclosing without producing the original note – the legal sine qua non of foreclosure – much less documentation that could support predatory lending defenses.”

But now here comes the real issue, “The real parties in interest” – the legal, rightful parties who have the legal right to foreclose on someone.

 The real parties in interest concealed behind MERS have been made so faceless, however, that there is now no party with standing to foreclose. The Kansas Supreme Court stated that MERS’ relationship “is more akin to that of a straw man than to a party possessing all the rights given a buyer.” The court opined:

“Straw” buyers – buyers who just put up their credit and purchased a home for someone else was and still is illegal.  “Straw” purchases are illegal and many have been prosecuted and sentenced to jail as a result.  Should not the same happen when an entity is created to be a “Straw” owner of a secured note?  Hiding and shielding the truth is illegal.  The Kansas Supreme Court has seen the truth and ruled in favor of the truth and justice.  They are not intimidated by the banks who have been lying, cheating and stealing.

This next quote is important and as such I will highlight in bold certain words or passages.

MERS as straw man lacks standing to foreclose, but so does original lender, although it was a signatory to the deal. The lender lacks standing because title had to pass to the secured parties for the arrangement to legally qualify as a “security.” The lender has been paid in full and has no further legal interest in the claim.  Only the securities holders have skin in the game; but they have no standing to foreclose, because they were not signatories to the original agreement. They cannot satisfy the basic requirement of contract law that a plaintiff suing on a written contract must produce a signed contract proving he is entitled to relief.

The “basic requirement of contract law” meaning that even a first year law student is knowlegeable of the basics therefore so to must be the banks and their high paid attorneys along with the foreclosure mill attorneys representing them in what they know to be fraudulent lasw suits for foreclosure.  Yes, FRAUDULENT, they are committing “Fraud on the Courts”.

It appears that there could be at least 60 million “Fatally Flawed Mortgages” in the country.  In other words, there are 60 million homeowners who if sued for foreclosure have a good basis on which to defend themselves.  Again, the Kansas ruling has no affect in other states but if contested using the facts of this case, other courts may – and should – rule the same way

The laws are the laws for everyone regardless of who they are or think they are.  Banks are breaking the law daily.  Attorneys who are representing banks in foreclosures- commonly referred to as “foreclosure mill attorneys” – are also breaking the law and violating their “oath” as officers of the law by knowingly and willfully bringing fraudulent foreclosure cases into our courts.

You don’t here these stories in main stream media because the banks spend too much money advertising.  You don’t hear reports like this coming from our government because our government -our elected representatives – are all complicit in this fraud against the American people. 

To correct the wrongs being made against the American people as a whole, destroying our economy along with our Constitution, we must each stand up for what is right.

“Two Wrongs Don’t Make A Right”

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  • Deborah Dugger  On May 13, 2010 at 2:28 AM

    What do I use ( form wise ) to prevent the sale of our home on 02 June 2010 as an injunction?

    I really need help here- any advise?

    Thank you so much.

    P.s. My husband & I have filed this in Federal Court, but we don’t have much time on them trying to sell our home- or that is MERS is using MILLSAP & SINGER as a trustee to sell our home from beneath us.

  • Deborah Dugger  On May 13, 2010 at 2:29 AM

    Ps.. you can contact me at :


    We live in Poplar Bluff, Missouri 63901

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