FIRST JUDICIAL DISTRICT COURT
COUNTY OF SANTA FE
STATE OF NEW MEXICO
Wells Fargo Bank NA,
Karen Marie Kline, Pueblos de Rodeo Road Owners
Association, Inc.; Manhattan Condominium Association,
AMENDED EXPEDITED MOTION FOR STAY OF ENFORCEMENT
COMES NOW Karen M. Kline and moves this Court to stay enforcement of the In Rem Judgment for Decree of Foreclosure and Order of Sale filed November 9, 2017. Appeal was timely filed. The issue is Wells Fargo’s standing, or apparent lack thereof, when it filed foreclosure against my home on the basis of the Mortgage Note. The following facts and law are grounds to stay enforcement of the In Rem Judgment for Decree of Foreclosure and Order of Sale.
Wells Fargo commenced foreclosure on my home with a copy of the Note attached to its April 7, 2008 Complaint for Foreclosure. However, Wells Fargo was unable to produce the Original Note. Wells Fargo proceeded to make a false Affidavit of Lost Original Note which it filed on July 19, 2011. The false affidavit stated that the document custodian shipped the Note to the legal department and then the Note was lost. At trial Wells Fargo testified that the July 19, 2011 Affidavit of Lost Original Note was false.
Although I came into Wells Fargo’s foreclosure thinking it was a foreclosure of my mortgage, I leaned that a foreclosure case is actually an enforcement of a negotiable instrument, the Original Note; and, this fact makes the Original Note integral to standing in a foreclosure.
New Mexico Statutes, Chapter 55 – Uniform Commercial Code, Article 3, Section 55-3-301 defines who is entitled to enforce a negotiable instrument: (i) the holder of the instrument, (ii) a nonholder in possession of the instrument who has the rights of a holder, or (iii) a person not in possession of the instrument who is entitled to enforce the instrument pursuant to Section 55-3-309.
Wells Fargo’s April 7, 2008 Complaint for Foreclosure purports to show that Wells Fargo is the holder of the instrument.
On March 18, 1993, for good and valuable consideration, Defendant Karen M. Kline made and delivered a mortgage note (“Note”) evidencing a debt in the principal sum of $72,000.00 with fixed interest from said date at the Note rate of 8.124% per annum on the unpaid balance until paid, payable in monthly installments of $534.60. A copy of the Note is attached hereto and made a part hereof as Exhibit A.
Well’s Fargo’s Complaint for Foreclosure does not say that the instrument is lost. A lost instrument is enforceable under 55-3-309, Enforcement of lost, destroyed, or stolen instrument: (a) A person not in possession of an instrument is entitled to enforce the instrument if (i) the person was in possession of the instrument and entitled to enforce it when loss of possession occurred, (ii) the loss of possession was not the result of a transfer by the person or a lawful seizure, and (iii) the person cannot reasonably obtain possession of the instrument because the instrument was destroyed, its whereabouts cannot be determined, or it is in the wrongful possession of an unknown person or a person that cannot be found or is not amenable to service of process.
In order to enforce the lost Original Note, under 55-3-309, Wells Fargo would have had to show that it was in possession of the note and entitled to enforce it when the note was lost. But, Wells Fargo’s business records, per Wells Fargo’s witness at trial, show that the last time the Original Note was seen was September, 2002, whereas Wells Fargo’s Complaint for Foreclosure was filed in April, 2008.
Moreover, in September, 2002 Wells Fargo sent the Original Note to First Union, the document custodian, or to FNMA. Beyond Wells Fargo’s business records saying original documents were sent, there is no record of First Union receiving the Original Note. In the absence of any record of First Union having received the Original Note it is irrelevant that in late 2008 Wells Fargo bought Wachovia which had merged with First Union, the document custodian, with Wells Fargo’s acquisition of Wachovia being finalized in March, 2010. The merger and acquisition dates show clearly that the note was not lost while in the possession of Wells Fargo, and, both late 2008 and March 2010 are after Wells Fargo filed its Complaint for Foreclosure on April 7, 2008.
Relevant case law states, “standing must be established as of the time of filing suit in mortgage foreclosure cases,” Deutsche v Johnston, 369 P.3d 1046 ¶20 (2016).
Significantly, the case law also states,
“The UCC provides that there are three scenarios in which a person is entitled to enforce a negotiable instrument such as a promissory note: (1) when that person is the holder of the instrument; (2) when that person is a nonholder in possession of the instrument who has the rights of a holder; and (3) when that person does not possess the instrument but is still entitled to enforce it subject to the lost-instrument provisions of UCC Article 3. To show a “direct and concrete injury, Deutsche Bank needed to establish that it fell into one of these three categories that would establish both its right to enforce Homeowner’s promissory note and its basis for claiming that it suffered a direct injury from Homeowner’s alleged default on the note.” Deutsche, pg 12. (¶ 14)
Thus, in order for Wells Fargo to have standing in the foreclosure of my home, Wells Fargo had to show a direct and concrete injury by establishing that it fell into one of the three UCC categories at the time of the filing of its mortgage foreclosure case. Wells Fargo not only failed to establish that it fell into one of these three UCC categories at the time of filing, Wells Fargo went on to knowingly mislead the court by filing a false Affidavit of Lost Original Note on July 19, 2011. Further, when the Affidavit of Lost Original Note, filed July 19, 2011, was not sustainable, Wells Fargo offered merger and acquisition records at trial to maintain the ruse that the Original Note had been in its possession when it was lost. Not only is there no record of the Original Note having arrived at First Union and being in its possession, the fact is that Wells Fargo’s merger and acquisition records show that Wells Fargo did not possess Wachovia and First Union which had merged with Wachovia at the time of filing of this foreclosure case.
All of the above being true, there are good grounds to stay the enforcement of the In Rem Judgment for Decree of Foreclosure and Order of Sale.
Because Wells Fargo made and filed a false affidavit, which is a grievous assault on justice and a contempt of court, I am copying my Amended Expedited Motion to New Mexico’s Attorney General, Hector Balderas. Although the date of the Wells Fargo’s false Affidavit of Lost Original Note is more than four years ago the false affidavit is still on the record in this case and as such continues to be contempt of court and continues to willfully tell an untruth in court. My letter to New Mexico’s Attorney General, Hector Balderas, is Exhibit 1.
WHEREFORE I respectfully move the Court for stay of enforcement so that the New Mexico Court of Appeals can rule on whether Wells Fargo had standing when it filed its Complaint for Foreclosure on April 7, 2008.
Karen M. Kline, aka Karen Marie Kline, pro se
Santa Fe, New Mexico 87507
CERTIFICATE OF SERVICE: I caused a second true copy of the above AMENDED EXPEDITED MOTION FOR STAY OF ENFORCEMENT to be mailed today, August 15, 2018, to:
McCarthy & Holthus, LLP
6501 Eagle Rock NE, Suite A-3
Albuquerque, NM 87113
TEL: (505) 219-4900
New Mexico Attorney General
408 Galisteo Street
Santa Fe, NM 87501
Karen Marie Kline
3255 Calle de Molina
Santa Fe, NM 87507
August 13, 2018
New Mexico Attorney General
408 Galisteo Street
Santa Fe, NM 87501
Dear Attorney General Balderas,
Enclosed is a copy of my Expedited Motion for Stay of Enforcement. It references Wells Fargo’s Affidavit of Lost Original Note that Wells Fargo has admitted is false.
I previously mailed you a copy of my Expedited Motion to Have Foreclosure Sale Postponed because that motion, too, references Wells Fargo’s false Affidavit of Lost Original Note.
Since Wells Fargo’s false affidavit is still a part of the official court record does that prevent the statute of limitations from running out on it? It would seem that as long as the affidavit is in the case and the case is not final because it is in appeal, that the affidavit is currently fraudulent and currently in contempt of court.
It causes me great distress and anxiety that Wells Fargo made and filed a false affidavit in order to use fraud to take my home. I have been fighting Wells Fargo since 2008 when Wells Fargo did not serve me the Complaint it filed on April 7, 2008. I was lucky to have been looking at Case Lookup for something altogether different. That’s how I happened to find the foreclosure. If I hadn’t found it my home would have been foreclosed and sold under a default judgement, just like my condo was. You can see, if you look at Case Lookup that there is no Return of Service filed for me.
The fact that Wells Fargo did not serve me gave me the indelible impression that Wells Fargo would break any law in order to get what it wanted, and it wanted my home.
The stress of fighting Wells Fargo from its initial violation of due process till now has taken a toll on my health. My nerves are so damaged that I can no longer walk or stand without holding on to my walker.
Wells Fargo has contract rights. I understand and respect that. That is why I applied for loan modification and was in fact qualified by Wells Fargo for HAMP loan modification in 2009. Sadly, Wells Fargo reneged. I could have been paying Wells Fargo since 2009.
It is unfathomable to me that Wells Fargo can be allowed to violate Due Process and go on to make and file a false affidavit. How in any kind of justice system can my home be auctioned before the Appeals Court can hold Wells Fargo to UCC requirements regarding negotiable instruments? The fact is that Wells Fargo did not have the Original Note when it filed its foreclosure case against my home, nor was Wells Fargo in possession of the Original Note when the Original Note was lost.
I am 73 years old. I bought my home in 1993. I am not well. I have a brain injury which makes it difficult for me to talk, much as my damaged nerves make it difficult for me to walk. I have $705/mo. from Social Security and another $47.25 from SSI. I cannot afford a Supersedeas Bond of thousands of dollars, much less hundreds of thousands of dollars.
I am offering to pay $270/mo which is the same amount Wells Fargo agreed would be my modified loan payment, before Wells Fargo reneged. I don’t know if that will satisfy the Court, but it is all I can pay without hardship. I should mention that I have a garden which provides food. I planted my pear trees in 1993.
I am writing to you because it seems so vastly unjust that my home could be sold when the foreclosure process has been so badly flawed in my case.
If there is any way you can help, and if you can help so that other homeowners are not put through this kind of horrible ordeal, I would be grateful beyond words.
Also, is there a cause of action I can assert to sue Wells Fargo for its violation of due process, and use of fraud in its foreclosure action against my home?
Karen Marie Kline