Wells Fargo Sues Self, Hires Different Lawyers To Respond

from the you-can't-make-this-up dept

Ah, the nuttiness of our legal system. Reader Bettawrekonize sends in the news that Wells Fargo has sued itself in a foreclosure dispute:

In this particular case, Wells Fargo holds the first and second mortgages on a condominium, according to Sarasota, Fla., attorney Dan McKillop, who represents the condo owner. As holder of the first, Wells Fargo is suing all other lien holders, including the holder of the second, which is itself.

And, of course, being on the receiving end of a lawsuit, the bank has hired some lawyers (different than the ones it hired to file the lawsuit) to respond:

Wells Fargo hired Florida Default Law Group., P.L., of Tampa, Fla., to file the lawsuit against itself.

And then Wells Fargo hired another Tampa law firm — Kass, Shuler, Solomon, Spector, Foyle & Singer P.A. — to defend itself against its own lawsuit, according to court documents.

Wells Fargo’s defense lawyers even filed an answer to their client’s own complaint.

“Defendant admits that it is the owner and holder of a mortgage encumbering the subject real property,” the answer reads. “All other allegations of the complaint are denied.”

Isn’t it great to know that, post-bailout, banks aren’t wasting all that taxpayer money we gave them?

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Companies: wells fargo

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Comments on “Wells Fargo Sues Self, Hires Different Lawyers To Respond”

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44 Comments
interval says:

Re: Re: nothing to see here

@bwp: “But it is an issue. It has nothing to do with knowing about subsidiaries…”

Yes, it does. “move along” is right, this kind of thing happens a lot. The business relationships in these things are so complex that the matter of en entity suing itself is somewhat immaterial and academic.

Ryan says:

Re: Re: Re: nothing to see here

One of two things is happening here:

1) Wells Fargo is completely inane and is wasting time and money suing itself unnecessarily (or is bound by an inane contract), or

2) Wells Fargo is compelled to sue itself as the result of some dynamic in the law that is completely inane and results in waste and inefficiency in the marketplace

Neither is immaterial, because resources are being wasted in a judicial black hole. Better #1 than #2, but if this is commonplace, then it is evidence of a pretty significant problem in the system. That you can think it immaterial that businesses are wasting money on lawyers is pretty odd to me…

bwp (profile) says:

Re: Re: Re: nothing to see here

Trust me. I’m in business and I deal with things like this at times so I know it happens. The point though is that it shouldn’t happen. We’ve over-legislated ourselves. Now I can’t make a agreement with another party without our lawyers going over the contacts ad nausem. Maybe I’m just being nastalgic today but I do miss the days when business people ran all aspects of their businesses unlike today where lawyers have more say than they should.

Paul Brinker (profile) says:

How about just having the letter delivered to the team doing the lawsuit and not spending a dime? That way you can show you notifiyed all partys (including yourself)

Even with Creditor rights you are most likly not required to notify yourself in the event your sueing on a product with 2 loans aginst it. This more sounds like lawyers trying to ensure more lawyers get paid.

A. LEISTAD says:

WELLS FARGO LAW SUIT

THE REASON IS PROBABLY THIS: THE FIRST MORTGAGE WAS SOLD IN THE SECONDARY MARKET AND UNDER THE AGREEMENT WELLS FARGO IS REQUIRED TO COLLECT THE LOAN. SO THE ATTORNEY FOR THE FIRST MORTGAGE IS REPRESENTING THE PURCHASER OF THE FIRST MORTGAGE. I PRESUME IT CAN NOT REPRESENT WELLS FARGO ON THE SECOND MORTGAGE.

THE SECOND MORTGAGE IS HELD SOLELY BY WELLS FARGO, SO THE ATTORNEY IS REPRESENTING ONLY WELLS FARGO.

Anonymous Coward says:

I suspect they’re just covering their backsides. In order to get around the whole “down payment” anachronism people take out a second mortgage to pay the down payment on their first mortgage. Bank didn’t used to do this, and so the foreclosure laws don’t reflect it. Hopefully banks will stop doing this, but who knows.

The problem here isn’t that the bank is suing itself, but rather that one bank gave two loans at the same time to someone. If banks want to give out mortgages to people for 100% of the sale price then they should just do so.

Ryan says:

Re: Right Wing To The eXtreme

Right, because government has nothing to do with setting the laws that resulted in this travesty in the first place. But if Wells Fargo is really just that dumb a business, it will quickly fail and be replaced by more competent businesses anyway.

Except that…well crap, it looks like the government gave them $25 billion to continue to waste on this sort of stuff.

A. L. Flanagan (profile) says:

Re: Re: Right Wing To The eXtreme

Problem with that is, they could be incompetent at one part of their business and make up for it in another. Just as a hypothetical they might, oh, I don’t know, buy out every competitor they have. But in this case I suspect it’s not Wells Fargo that’s frakked up, it’s the legal system. Unless you’re a lawyer, in which case this is just great.

Big Time says:

Re: Re: Right Wing To The eXtreme

The reason that the Big Government is inefficient is not that its the Government, its that its big. Big Business is just as inefficient as Big Government. It has simply to do with the complexity of an organization and the associated bureaucracy that comes along with it.

John Doe says:

Re: Re: Re: Right Wing To The eXtreme

Thanks for adding to my point. A government that can’t run the public sector properly cannot be trusted with the private sector. And since the government is to big to run itself, getting bigger in order to take on the public sector isn’t going to work either.

Ryan says:

Re: Re: Re: Right Wing To The eXtreme

Along with the fact that is often not accountable(being able to make the rules and often having a self-imposed monopoly) and is subsidized by the taxpayers, which eliminates profit incentives for the most part. Subsidies also ensure that government programs never have to fail and so may continue along as resource drains for as long as they are politically correct.

No doubt big businesses are many times going to be more inefficient than small ones, although there are also advantages(see: Wal-Mart). But the biggest thing is that a business has to convince customers to give it their money; it can’t just tax them upon threat of jail. If it can’t become efficient enough to make a profit, it will fail. Either way, taxpayers don’t take the hit–unless the government decides to give it several billion dollars to prevent the very thing that is so important in a free market.

Derek Kerton (profile) says:

Re: Re: Right Wing To The eXtreme

No, I think they are equally competent / incompetent.

Each gets some things done right, and gets some fudged-up.

But the talk-radio hosts who purport that one group always screws up and the other group is heaven-sent are wrong. “Big government” has its downsides, but so does “big business”.

Here’s big business’ move for today:
http://blogs.consumerreports.org/money/2009/07/credit-card-act-companies-tricks-traps-increase-interest-rate-balance-transfer-fee-fixed-variable-simmon.html

Anonymous Coward says:

Is the National Association Realtors Code of Ethics Bogus?

Home owners may want to know if the National Association of Realtors stands behind their Golden Rule. The question arises because of a landmark case in Texas which began in the late 1990’s involving the Houston address 7255 Sims, Garden Villas.

Ameriquest Mortgage Company, now out of business, surveyed, appraised and took as collateral 29,241 square feet out of customer, Darlene L. Hosea’s 48,842 sq.ft. homestead tract. The remaining 19,601 sq.ft. is still owned by Hosea.

Further, the papers signed by Hosea at that time clearly states in definition that an urban homestead shall not exceed one acre of land. Hosea’s homestead exceeds one acre. Shouldn’t the contract void if the prerequisites, rules or requirements were not followed?

Fast forward 10 years. The Property is foreclosed and up for sale with a Multiple Listing Service # 5359712. Hosea also takes issue with the listing because the real estate broker, David Denenberg retains a copy of Ameriquest’s survey but is not honest with potential customers or buyers about the foreclosed land. This is a violation of the realtors Golden Rule. There is a lien created on the property which bears tax account number 0600020000044.

Adopted in 1913 The Real Estate Code sets high standards for realtors, agent and brokers of real estate. The Code and its’ Articles are based on honesty and integrity in all real estate transactions. It employs social responsibility to those in the industry who have vowed to be stewards of our land.

How do you measure standards in the real estate industry? The Code states that the Articles spell out what the agent must and must not do. Consumer protection is among the highest ethical principles. Maybe it is time for the Board of Directors to review the Standards of Practice in this case or perhaps the Delegate Body or, Legislators may even take a look by stepping up to the base and helping Hosea and like customers.

The answers to the above questions can be found in Principle, The Code and its’ Articles. For now, Hosea seeks to sell her 19,601 sq.ft. of the soured mortgage related asset and move on with her life after the consequences of defending herself five years from bullies in an industry riddled with improprieties.

Whoopie

Anonymous Coward says:

Is the National Association Realtors Code of Ethics Bogus?

Home owners may want to know if the National Association of Realtors stands behind their Golden Rule. The question arises because of a landmark case in Texas which began in the late 1990’s involving the Houston address 7255 Sims, Garden Villas.

Ameriquest Mortgage Company, now out of business, surveyed, appraised and took as collateral 29,241 square feet out of customer, Darlene L. Hosea’s 48,842 sq.ft. homestead tract. The remaining 19,601 sq.ft. is still owned by Hosea.

Further, the papers signed by Hosea at that time clearly states in definition that an urban homestead shall not exceed one acre of land. Hosea’s homestead exceeds one acre. Shouldn’t the contract void if the prerequisites, rules or requirements were not followed?

Fast forward 10 years. The Property is foreclosed and up for sale with a Multiple Listing Service # 5359712. Hosea also takes issue with the listing because the real estate broker, David Denenberg retains a copy of Ameriquest’s survey but is not honest with potential customers or buyers about the foreclosed land. This is a violation of the realtors Golden Rule. There is a lien created on the property which bears tax account number 0600020000044.

Adopted in 1913 The Real Estate Code sets high standards for realtors, agent and brokers of real estate. The Code and its’ Articles are based on honesty and integrity in all real estate transactions. It employs social responsibility to those in the industry who have vowed to be stewards of our land.

How do you measure standards in the real estate industry? The Code states that the Articles spell out what the agent must and must not do. Consumer protection is among the highest ethical principles. Maybe it is time for the Board of Directors to review the Standards of Practice in this case or perhaps the Delegate Body or, Legislators may even take a look by stepping up to the base and helping Hosea and like customers.

The answers to the above questions can be found in Principle, The Code and its’ Articles. For now, Hosea seeks to sell her 19,601 sq.ft. of the soured mortgage related asset and move on with her life after the consequences of defending herself five years from bullies in an industry riddled with improprieties.

Whoopie

Anonymous Coward says:

Is the National Association Realtors Code of Ethics Bogus?

Home owners may want to know if the National Association of Realtors stands behind their Golden Rule. The question arises because of a landmark case in Texas which began in the late 1990’s involving the Houston address 7255 Sims, Garden Villas.

Ameriquest Mortgage Company, now out of business, surveyed, appraised and took as collateral 29,241 square feet out of customer, Darlene L. Hosea’s 48,842 sq.ft. homestead tract. The remaining 19,601 sq.ft. is still owned by Hosea.

Further, the papers signed by Hosea at that time clearly states in definition that an urban homestead shall not exceed one acre of land. Hosea’s homestead exceeds one acre. Shouldn’t the contract void if the prerequisites, rules or requirements were not followed?

Fast forward 10 years. The Property is foreclosed and up for sale with a Multiple Listing Service # 5359712. Hosea also takes issue with the listing because the real estate broker, David Denenberg retains a copy of Ameriquest’s survey but is not honest with potential customers or buyers about the foreclosed land. This is a violation of the realtors Golden Rule. There is a lien created on the property which bears tax account number 0600020000044.

Adopted in 1913 The Real Estate Code sets high standards for realtors, agent and brokers of real estate. The Code and its’ Articles are based on honesty and integrity in all real estate transactions. It employs social responsibility to those in the industry who have vowed to be stewards of our land.

How do you measure standards in the real estate industry? The Code states that the Articles spell out what the agent must and must not do. Consumer protection is among the highest ethical principles. Maybe it is time for the Board of Directors to review the Standards of Practice in this case or perhaps the Delegate Body or, Legislators may even take a look by stepping up to the base and helping Hosea and like customers.

The answers to the above questions can be found in Principle, The Code and its’ Articles. For now, Hosea seeks to sell her 19,601 sq.ft. of the soured mortgage related asset and move on with her life after the consequences of defending herself five years from bullies in an industry riddled with improprieties.

Whoopie

Mark says:

I don’t know that it happens all the time, but Wells Fargo is doing it this way because more than likely the attorney’s malpractice carrier won’t permit them to represent both claims and quite possibly the local bar will not permit it.

The second mtg is in all liklihood worthless (I’ve not seen second in line get money very often) but the bank owes a fiduciary duty to the shareholders to protect that second mortgage and a fiduciary duty to pursue the first fully that is in theory a conflict. In rural states, with less malpractice action, calmer judges, a less active bar association and more common sense, one firm handles the whole thing asserting its client holds two interests, admits the first mortage is paramount and asks the judge to be a judge and sort out priority.

Letter of the law, Wells is doing it right and if they were certain no one is looking over their shoulder they could do it the easy way, but that ain’t happening.

martin martinez says:

Compensation for Hosea-King-Ford Family

Dont blame the survivors. This is an administrative blunder because the money for compensation went towards defending the wrong people. Yes, I know the system is run by people, like all humans,people make mistakes. The issue here is when impropriety is discovered and citizens are economically injured, the company should pay immediately. Otherwise, white collar criminals, will continue to cause havoc and not pay consequences for their actions. Apply The Golden Rule. We are not too big to sink. I agree with paying the family.

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