Vincent Howard and our Riverside County foreclosure defense attorneys have followed stories on robo-signing since it first broke in late 2010, so we were interested to see a case on it out of Maine. Though the media has moved on from this story, in fact, Maine was one of the first states to uncover evidence of robo-signing and raise questions about whether it could invalidate foreclosures. In Bradbury v. GMAC Mortgage et al., the question was whether GMAC employee Jeffrey Stephan could defend himself from a suit brought under the Maine Unfair Trade Practices Act by claiming immunity under the state's judicial proceedings privilege. The Maine Supreme Judicial Court ultimately declined to rule on the matter, finding that the facts may not support the use of the privilege in any case, and thus a ruling could make inappropriate law.
The case came to the state's highest court from a federal district court in Maine, where a group of Maine homeowners and former homeowners led by named plaintiff Nicolle Bradbury sued GMAC Mortgage. They alleged that they were victims of illegal foreclosure proceedings because the affidavits GMAC relied on in Maine court had been falsely signed by Stephan and falsely notarized. (The complaint noted that GMAC has been sanctioned for this practice in state court but alleged that it continues.) They claimed damages for the loss of their homes, attorney fees, and other costs of defending the foreclosures. The original lawsuit was removed to federal court, which granted GMAC's motion to dismiss common-law claims under Maine's absolute judicial proceedings privilege. However, the court certified a question to the Maine Supreme Judicial Court about whether the privilege could defeat the claim made under the state Unfair Trade Practices Act.
The court noted that GMAC denies the plaintiffs' allegations that Stephan falsely signed the affidavits. Though the summary judgment ruling didn't turn on this dispute, the high court found the dispute was entwined with the certified question. The judicial proceedings privilege provides witnesses immunity from lawsuits claiming their testimony was false. In this case, however, the court found that Stephan's affidavits were not testimony because they bore false notarizations and could not have been considered by a trial court. As a result, the privilege being claimed does not apply, the court said. And that means either answer would have a bad result: allowing the privilege would lead to dismissal of the case, even though the facts may show that Stephan isn't entitled to the privilege, but denying it would make a broader pronouncement of law inappropriate when the privilege doesn't apply. This, it respectfully declined to answer.
Because of the structure of this appeal, it may not be clear that this is a victory for the plaintiffs--but Vincent Howard and our Huntington Beach foreclosure defense lawyers are pleased by the result. By declaring that the affidavits are not "testimony," the high court essentially denied GMAC the chance to use the privilege in defending this suit or any similar suit. In fact, the high court also noted that a similar privilege involving pleadings also does not apply. That's good news for plaintiffs like Bradbury, because their claims are more likely to be heard on their merits. There's no guarantee that they will succeed, but Vincent Howard and our Murrieta foreclosure defense attorneys always prefer to see plaintiffs have a fighting chance.
Based in Costa Mesa, Howard Law, P.C., represents Californians who are victims of unfair foreclosure proceedings and predatory lending practices. If you believe your lender took advantage of you and you'd like to talk about your rights and your legal options, call us today at 1-800-872-5925 or send us an email to tell us about your case.