George, With regard to your first question, in Florida, Holly Hill Acres LTD vs
Charter Bank of Gainsville 314 So. 2nd 209, Fl2nd DCA 1975 also GMAC
vs Honest Air Conditioning & heating, Inc., 933 So. 2nd 34 Fl.2nd DCA, 2006. There are many more listed in West's.(With regard to the negotiable instrument issue)
With regard to the "Death gamble" defense, we have had several dismissed but without prejudice, therefore, they can refile so I can not
provide the case numbers at this time.
The key point is that if the original lender "died" several years ago without
lawfully transferring the Note and Mortgage, there probably is no entity to
whom the debt is owed. When the servicer comes into court, it can not
prove it owns the loan, therefore it has no standing and the case gets
dismissed. (gager in French=to wager) a gage is a wager (Black's Law Dictionary 1968) (mort in French=death).
It's called a "mort-gage" (death gamble) because the borrower puts up
the deed, the lender puts up the cash, whichever "dies" first, loses.Very often, the borrower dies just short of paying off the loan and the lender forecloses thereby winning (gagnant) the equity of the dead borrower.
The early Church considered this form of loan to be "usury" and outlawed
it, but it continued in the Anglo-Saxon countries. Today, on the Continent
they use a "hypotheque" which means a "gage" but without the "mort".
If the borrower dies short of paying it off, the lender only gets the balance
owed, not the entire property as is often the case in America.
Sometimes the borrower wins the "death gamble" which means a "quiet
title" is in order. We are doing one now. So far, the servicer and MERS defaulted, while the successor to the dead lender did answer by contesting
the ownership of the deed, calling it a "deed of trust" held by a Trustee.
Such is not the case in Florida but I can see how this defense could be a
problem in a "deed of trust" state like California. Also, the defendant moved
the case up into the US District Court from the State Court, which is no problem at all, since operating in federal Court is even easier than State
Court. Since the plaintiff here has a valid "warranty deed", I don't expect
we will have any problem winning the Quiet Title action against the "dead
lender" which went out of business in 2006 without ever assigning the mortgage. The key point is that a "mort gage" is due on "death" (of either
party unless it was lawfully transferred). This is a hard concept for most
people to grasp but when they "get it", then the logic of what we are doing
will become apparent.
The current "system" uses MERS and the "negotiable instrument" fraud
to defeat the "death gamble" concept. They have MERS acting as the agent
of "dead lenders" to assign the mortgage to the servicer, posing as a phony
trustee of a phony trust. They will call a "variable interest Note" which requires reference to the Wall Street Journal to figure out the balance owed,
a negotiable instrument, even when it has late charges, refers to the
security agreement (mortgage) to calculate the balance owed and other "excess luggage". True negotiable instruments follow the KISS formula,
KEEP IT SHORT AND SIMPLE! Our legal system has gotten far adrift of this
basic concept, which allows these pretender lender servicers to collect
money and steal houses, in which they have no equity.
So far, only the "deciples" of Neal Garfield seem to understand the full scope of the scam that is being perpetrated on the American people. I hope more people wake up so we can save this country from disaster, one home at a time. This is why we do what we do.
The note having incorporated the terms of the purchase money mortgage was not negotiable. The appellee Bank was not a holder in due course, therefore, the appellant was entitled to raise against the appellee any defenses which could be raised between the appellant and Rogers and Blythe. Since appellant asserted an affirmative defense of fraud, it was incumbent on the appellee to establish the non-existence of any genuine issue of any material fact or the legal insufficiency of appellant's affirmative defense. Having failed to do so, appellee was not entitled to a judgment as a matter of law; hence, we reverse.
The note, incorporating by reference the terms of the mortgage, did not contain the unconditional promise to pay required by Fla. Stat. § 673.3-104(1) (b). Rather, the note falls within the scope of Fla. Stat. § 673.3-105(2) (a). Although negotiability is now governed by the Uniform Commercial Code, this was the Florida view even before the U.C.C. was adopted. E.g., the Supreme Court in Brown v. Marion Mortgage Co., 1932, 107 Fla. 727, 145 So. 413, held that certain bonds which were "to be received and held subject to" a certain mortgage were non-negotiable. See also, First Bank of Marianna v. Havana Canning Co., 1940, 142 Fla. 554, 195 So. 188; Voges v. Ward, 1929, 98 Fla. 304, 123 So. 785; Mason v. Flowers, 1926, 91 Fla. 224, 107 So. 334.
Appellee Bank relies upon Scott v. Taylor, 1912, 63 Fla. 612, 58 So. 30,
as authority for the proposition that its note is negotiable. Scott,
however, involved a note which stated: "this note secured by mortgage." Mere reference to a note being secured by mortgage is a common commercial practice and such reference in itself does not impede the negotiability of the note. There is, however, a significant difference in a note stating that it is "secured by a mortgage" from one which provides, "the terms of said mortgage are by this reference made a part hereof." In the former instance the note merely refers to a separate agreement which does not impede its negotiability, while in the latter instance the note is rendered non-negotiable. See
Fla. Stat. §§ 673.3-105(2) (a); 673.3-119.
As a general rule the assignee of a mortgage securing a non-negotiable note, even though a bona fide purchaser for value, takes subject to all defenses available as against the mortgagee. 22 Fla.Jur., Mortgages, §§ 555-56. Appellant raised the issue of fraud as between himself and 212*212 other parties to the note, therefore, it was incumbent on the appellee Bank, as movant for a summary judgment, to prove the non-existence of any genuinely triable issue. Holl v. Talcott, Fla. 1965, 191 So.2d 40.