Complaint (Baker) Common Pleas Corrected

8/3/2019 Complaint (Baker) Common Pleas Corrected

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RELATED PENDING CASES (LIST BY CASE CAPTION AND DOCKET NUMBER) IS CASE SUBJECT TO

FINAL COPY (Approved by the Prothonotary Clerk)

COORDINATION ORDER?

DEFENDANT'S ADDRESS

DEFENDANT'S NAME

Court of Common Pleas of Philadelphia County

Trial Division

Civil Cover SheetDEFENDANT'S NAME

DEFENDANT'S ADDRESS

DEFENDANT'S NAME

DEFENDANT'S ADDRESS

SARAH E. BAKER

ERIC G. BAKER

6370 DEL HAVEN ROAD

BANGOR PA 18013

6370 DEL HAVEN ROAD

BANGOR PA 18013

PLAINTIFF'S NAME

PLAINTIFF'S ADDRESS

PLAINTIFF'S NAME

PLAINTIFF'S ADDRESS

PLAINTIFF'S NAME

PLAINTIFF'S ADDRESS

DEUTSCHE BANK NATIONAL TRUST COMPANY

PHELAN HALLINAN & SCHMIEG, LLP

4828 LOOP CENTRAL DRIVE

HOUSTON TX 77081-2226

1617 JOHN F. KENNEDY BLVD. SUITE 1400

PHILADELPHIA PA 19103-1814

AMOUNT IN CONTROVERSY

CASE TYPE AND CODE

TOTAL NUMBER OF PLAINTIFFS TOTAL NUMBER OF DEFENDANTS COMMENCEMENT OF ACTION

COURT PROGRAMS

STATUTORY BASIS FOR CAUSE OF ACTION

2 2Complaint

Writ of Summons

Petition Action

Transfer From Other Jurisdictions

Notice of Appeal

X

$50,000.00 or less

More than $50,000.00X

Arbitration

Jury

Non-Jury

Mass Tort

Savings Action

Other:

Petition

Commerce

Minor Court Appeal

Statutory Appeals

Settlement

Minors

W/D/Survival

X

SIGNATURE OF FILING ATTORNEY OR PARTY

SUPREME COURT IDENTIFICATION NO.

PHONE NUMBER FAX NUMBER

DATE SUBMITTED

E-MAIL ADDRESS

ADDRESS

TO THE PROTHONOTARY:

Kindly enter my appearance on behalf of Plaintiff/Petitioner/Appellant:

Tuesday, March 22, 2011, 04:17 pm

51895 [email protected]

MICHAEL D. DONOVAN DONOVAN SEARLES, LLC

1845 WALNUT ST

SUITE 1100

PHILADELPHIA PA 19103(215)732-6067 (215)732-8060

MICHAEL DONOVAN

SARAH E BAKER , ERIC G BAKER

Papers may be served at the address set forth below.

NAME OF PLAINTIFF'S/PETITIONER'S/APPELLANT'S ATTORNEY

2E - WRONGFUL USE OF CIVIL PROCESS

J. MURPHY

MAR 22 2011

YES NO

E-Filing Number: 1103039016

For Prothonotary Use Only (Docket Number)


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DONOVAN SEARLES & AXLER, LLCMICHAEL D. DONOVAN, ESQUIREAttorney I.D. No. 518951845 Walnut Street, Suite 1100Philadelphia, PA 19103

Telephone: (215) 7326067Facsimile: (215) 7328060

ATTORNEY FOR PLAINTIFFS

SARAH E. BAKER and ) COURT OF COMMON PLEAS OFERIC G. BAKER, ) PHILADELPHIA COUNTY

)Plaintiffs, ) MARCH TERM, 2011

)v. ) NO. 02291

)

DEUTSCHE BANK NATIONAL ) JURY TRIAL DEMANDEDTRUST COMPANY and ))

PHELAN, HALLINAN & SCHMIEG, )LLP. )

)Defendants. )

)

COMPLAINT

I. NATURE OF THE ACTION

1. Plaintiffs Sarah E. Baker and Eric G. Baker (collectively, Plaintiffs or theBakers) bring this action on their own behalf for damages arising out of Defendants violations

of the Dragonetti Act, for wrongful use of civil proceedings, 42 Pa. C.S. 8351 et seq., and for

abuse of process.

2. The Bakers were named defendants in a foreclosure action filed and prosecutedby the Defendants named herein, which action the Defendants voluntarily discontinued on May

19, 2010, after the trial court denied summary judgment of foreclosure, thus conclusively

resolving the matter in favor of the Bakers.

Case ID: 11030

Filed and Attested by

PROTHONOTARY

22 APR 2011 11:02 am

P. MARTIN


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3. Defendants herein procured, initiated or continued the foreclosure action for theimproper purpose of interfering with the Bakers quiet enjoyment of their sole resid encetheir

home casting a cloud on their title, impeding their ability to use and enjoy their property,

materially threatening the Bakers with the posting of a Sheriffs sale and the loss of virtually all

of their wealth and their only home, and destroying the Bakers credit and their ability to obtain

financing, jobs, credit and other related benefits of good credit.

4. As detailed below, Defendants lacked any probable cause or reasonable belief,and were grossly negligent, in alleging that Deutsche Bank owned or continued to own any legal

right to an alleged Loan and Mortgage on the Bakers property when Defendants knew or were

reckless in not knowing that Deutsche Bank had sold the alleged Loan and Mortgage back to the

originator, WMC Mortgage Corp., weeks before the foreclosure action was even filed.

5. Defendants also knew or recklessly disregarded the fact that the alleged Loan andMortgage had been rescinded by the Bakers within three (3) business days of the loan closing as

provided by the Truth in Lending Act, 15 U.S.C. 1635, meaning that Defendants not only

lacked any standing to pursue the alleged foreclosure but also lacked any legitimate claim for

foreclosure or to continue the foreclosure case on a transaction that was rescinded and a

mortgage that was void as a matter of law, which is why the trial court had denied summary

judgment in the underlying foreclosure case.

6. As a direct and proximate result of Defendants wrongful use of civil proceedingsand their abuse of process, the Bakers have suffered extensive damages and are entitled to an

award of punitive and other actual and exemplary damages.

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II. THE PARTIES7. Plaintiffs Sarah E. Baker and Eric G. Baker are adult individuals and citizens of

the Commonwealth of Pennsylvania, residing at 6370 Del Haven Road, Bangor, Pennsylvania.

8. Defendant Deutsche Bank National Trust Company, NA (Deutsche Bank) is anational banking association chartered and supervised by the Office of the Comptroller of the

Currency with headquarters in New York, NY, Los Angeles, CA, and Houston, TX. Deutsche

Bank regularly engages in continuous and substantial business in the Commonwealth of

Pennsylvania and in Philadelphia County.

9.

Defendant Phelan, Hallinan and Schmieg, LLC (Phelan) is a law firm with its

primary office located at 1617 JFK Boulevard, Suite 1400, in Philadelphia, Pennsylvania, 19103.

III. VENUE

10. Defendants do substantial business in Philadelphia County.11. Defendant Deutsche Bank holds the mortgages and mortgage debts on scores of

homes throughout Philadelphia County and pursues mortgage foreclosure actions as a party-

Plaintiff in Philadelphia County.

12. Defendant Deutsche Bank has acted as Trustee/Servicer for not fewer than 5,139mortgage and/or debt collection cases filed or prosecuted in Philadelphia County.

13. Defendant Phelan represents mortgage loan servicers and/or trustees acrossPennsylvania, and its primary office is located in Philadelphia County.

IV. FACTUAL ALLEGATIONS

14. On June 3, 2005, the Bakers entered into a residential mortgage loan transactionto refinance their home mortgage (Loan). The Loan closing occurred in the Bakers home, and

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the escrow agent for the lender, WMC Mortgage Corporation, provided the Bakers with a Notice

of Right to Cancel. See Exh. A, hereto (Tr. Trsc. 2/9/11 pp.160-62).

15. In accordance with the Notice of Right to Cancel, on June 7, 2005, the Bakerscancelled and rescinded the Loan. See id. See also Exh. B, hereto (Notice of Right to Cancel).

16. The Loan originator, WMC Mortgage Corporation, received the signedcancellation form and has admitted that it is in the loan file for the transaction. SeeExh. C,

hereto (Tr. Trsc. 2/8/11 90:418).

17. WMC Mortgage Corporation disregarded the Bakers rescission and instead soldthe purported Loan to a Goldman Sachs securitization trust, known as GSAMP Trust 2005-

WMC on July 29, 2005, as to which Deutsche Bank was the securitization trustee. WMC

Mortgage Corporation was paid $159,999.47 by the GSAMP Trust. See Exh. D (Tr. Trsc. 2/8/11

154:24); seealso Exh. E (Tr. Trsc. 2/8/11 106:25; 107:16), hereto.

18. Having rescinded the transaction, the Bakers did not make any payments on theLoan and, instead, offered to return the un-cashed checks that the originators escrow agent and

title insurer had sent to them. See Exh. F (Tr. Trsc. 2/9/11 pp. 164-65); see also Exh. G (Tr.

Trsc. 2/9/11 176:812), hereto.

19. Because the Bakers did not make the first or any payment on the rescinded Loan, by the terms of the Pooling and Servicing Agreement for the securitization trust, the Bakers

Loan was repurchased by WMC Mortgage Corporation on April 22, 2006. WMC Mortgage

Corporation paid Deutsche Bank $164,985.57 on that date for the alleged Loan and mortgage.

See Exh. H, hereto (Tr. Trans. 2/8/11 pp. 108-09 (Testimony of WMC Mortgage Corporation

Senior Vice President Diane Taylor)).

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20. Thus, despite having been fully compensated for the Baker Loan and no longerowning that Loan or the alleged mortgage securing that rescinded indebtedness, on May 1, 2006,

Defendants filed a mortgage foreclosure action (hereinafter Foreclosure Action) in the Court of

Common Pleas of Northampton County, Pennsylvania, at No. C-48-CV-2006-3235, captioned

Deutsche Bank National Trust Company as Trustee under the Pooling & Servicing Agreement

Dated as of Sept. 1, 2005 v. Sarah E. Baker & Eric G. Baker, Exh. I, hereto.

21. The Foreclosure Action alleged that the Bakers had not made any payments onthe alleged mortgage debt. See id.

22.

The Foreclosure Action further alleged that the mortgage was in default because

monthly payments of principal and interest upon said mortgage due 08/01/2005 and each month

thereafter are due and unpaid . . . . Foreclosure Action at 3.

23. The Foreclosure Action further alleged that the Bakers owed $167,107.49 onthe mortgage when, in fact, Deutsche Bank and the GSAMP Trust had been paid $164,955.59 for

the same alleged debt on April 22, 2006.

24. The Foreclosure Action further alleged that Deutsche Bank is now the legalowner of the mortgage and is in the process of formalizing an assignment of same. Foreclosure

Action at 3. This allegation was incorrect and false.

25. In fact, in an action filed in the United States District Court for the EasternDistrict of Pennsylvania on June 28, 2010, and captioned WMC Mortgage LLC v. Sarah E. Baker

& Eric G. Baker, No. 5:10-3118-JS (E.D. Pa.), the plaintiff WMC Mortgage alleged, contended

and presented evidence that it owned the alleged Loan and Mortgage and that the Bakers owed

money to it. It presented evidence to the federal trial court that Deutsche Bank and the GSAMP

Trust were paid $164,955.59 in return for the alleged debt by WMC Mortgage Corp. on April 22,

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2006. It filed suit against the Bakers only after the Defendants herein had dismissed the

Foreclosure Action against the Bakers on May 10, 2010. Thus, Defendants herein knew or were

reckless in not knowing that they procured, initiated and continued the Foreclosure Action

against the Bakers when they had no standing and no legitimate claim, because a different entity,

WMC Mortgage Corp., owned any alleged claim and because the Bakers had served a timely

rescission on WMC Mortgage Corp. In other words, Defendants herein pursued a wrongful

Foreclosure Action against the Bakers for over four years.

26. In WMC Mortgage LLC v. Baker, WMC witness Diane Taylor specificallytestified, based on the business records of WMC Mortgage Corp., that WMC repurchased the

[Baker] loan on April 22, 2006 from the GSAMP Trust, paying 164,985.57, on that date.

See Exh. J, hereto (Tr. Trs. 2/8/11 pp. 108:25 109:1-5); seealso Exh. K, hereto (Tr.Trs. 2/8/11

pp. 106-108 (describing initial sale to GSAMP Trust)).

27. Thus, contrary to the allegations of the Foreclosure Action, Defendant DeutscheBank was not the legal owner of the alleged debt. In fact, they had been fully compensated by

WMC Mortgage Corp. for the alleged debt before the Foreclosure Action was filed. SeeExh. D,

hereto (Tr. Trsc. 2/8/11 154:24); see also Exh. E, hereto (Tr. Trsc. 2/8/11 106:25; 107:16).

28. No explanation was provided as to why Deutsche Bank filed the ForeclosureAction against the Bakers on May 1, 2006, if WMC Mortgage Corp. had, in fact, repurchased the

Loan on April 22, 2006. Nor is there any record explanation for the Foreclosure Action

proceeding for over four (4) years if the GSAMP Trust no longer owned the Loan and Mortgage.

29. Also significantly, WMC Mortgage witness Diane Taylor testified, based on thebusiness records of WMC Mortgage, that on June 2, 2006, WMC Mortgage Corp. sold the

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alleged Baker Loan and mortgage to GMAC Rescap for $156,705. See Exh. L, hereto (Tr.

Trsc. 2/8/11 p.162:7-16).

30. Defendants herein never advised the Court of Common Pleas, the Bakers oranyone else during the course of the underlying Foreclosure Action that parties other than

Deutsche Bank actually owned the alleged Baker Loan and Mortgage.

31. Furthermore, it is undisputed that the Bakers timely rescinded the Loan, whichimmediately rendered the mortgage void as a matter of law under the mandatory terms of 15

U.S.C. 1635(b). WMC Mortgage admitted that it had received the signed Notice of Right to

Cancel sometime after June 7, 2005. SeeExh. M, hereto (Donovan Decl. (Plaintiffs Responses

to Requests to Admit)).

32. Instead of honoring Plaintiffs rescission of the Loan, Defendant Deutsche Bankwrongfully attempted to collect payment of the rescinded Loan and then commenced the

Foreclosure Action against the Plaintiffs when it no longer owned the Loan and the mortgage

was void as a matter of law. See generally Foreclosure Action.

33. The Foreclosure Action was verified by Francis S. Hallinan, Esquire, of the firmPhelan Hallinan & Schmieg, LLP. Foreclosure Action at 6.

34. Although the Verification purported to verify that the statements made in theforegoing Civil Action in Mortgage Foreclosure are based upon information supplied by Plaintiff

and are true and correct to the best of his knowledge, information and belief, this was a falsity,

as Deutsche Bank knew or recklessly disregarded the fact that it had sold the alleged Loan and

mortgage back to WMC Mortgage Corp. on April 22, 2006 and, therefore, had no standing to

pursue the Foreclosure Action against the Bakers and their home. Deutsche Bank also knew or

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recklessly disregarded the fact that the mortgage was void as a matter of law under the Truth in

Lending Act.

35. Continuing with the wrongful use of civil proceedings and engaging in a furtherabuse of process, Defendants herein then threatened a Sheriff sale and posted a Sheriff Sale

notice on the Bakers home. The menacing and embarrassing Sheriffs Notice, posted on the

Bakers home on July 31, 2006, threatened the Bakers based on a real debt that was owed on

their real estate property. See Exh. N (Sheriffs Notice), hereto.

36. Despite knowing or recklessly disregarding their complete lack of standing andlack of any ground to foreclose on a void mortgage, Defendants pursued the Foreclosure Action

for over four (4) years, causing substantial expense, stress, trauma, anxiety, aggravation and

harm to Plaintiffs herein.

37. Defendant Deutsche Bank moved for summary judgment in the ForeclosureAction, and on April 23, 2009, the Court denied its motion. In this connection, the Bakers

opposed the defendants wrongful and threatening motion based on the rescission notice the

Bakers had delivered to the Loan originator, WMC Mortgage. Defendants herein disregarded

such proof and never advised the trial court, the Bakers or their foreclosure counsel that the Loan

and Mortgage had been repurchased by WMC Mortgage and never moved to intervene a correct

real party in interest, as required by the Pennsylvania Rules of Civil Procedure.

38. Defendants never advised the Bakers or the Court of Common Pleas that theylacked any standing to pursue the claims. Instead, they submitted to the Court and filed with the

Northampton Recorder of Deeds a false assignment of mortgage . . . together with the Note

and indebtedness therein mentioned dated May 23, 2006 and purportedly signed by the

Mortgage Electronic Recording Service, Inc. (MERS), representing that the Loan and

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Mortgage had been assigned to Deutsche Bank as trustee for the GSAMP Trust 2005-WMC

when, in fact, these entities had sold both the Loan and the Mortgage back to WMC Mortgage

Corp. on April 22, 2006. In other words, Defendants herein procured, initiated and continued the

Foreclosure Action based on false evidence they obtained from or had created by MERS to

portray an aggrieved status when, in fact, such was not the case.

39. On or about May 19, 2010, Defendants voluntarily discontinued and dismissedthe Foreclosure Action.

40. Defendant Deutsche Bank knowingly or recklessly disregarded the fact that it hadno claim against Plaintiffs in pursuing an action for an alleged debt. Defendants disregarded

Plaintiffs rescission of the loan and commenced the Foreclosure Action against Plaintiffs

without probable cause or reasonable belief in the merit of the claim or with gross negligence as

to the important rights of Plaintiffs herein.

41. On information and belief, Defendants herein intentionally or recklessly failed toinvestigate whether the Defendants had any cause to commence the Foreclosure Action against

the Plaintiffs.

42. Defendants failed to investigate whether the alleged Loan and mortgage were infact valid and not rescinded.

43. Defendants failed to investigate whether the GSAMP Trust 2005-WMC still infact owned the alleged Loan and mortgage.

44. Defendants failed to communicate with WMC Mortgage Corporation as towhether the alleged Loan was valid and not rescinded.

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45. Defendants failed to communicate with WMC Mortgage Corporation as towhether it had repurchased the alleged Loan and mortgage in accordance with the Pooling and

Servicing Agreement.

46. Defendants failed to investigate whether Deutsche Bank was in fact owed anymoney relating to the alleged Loan and mortgage or whether it had, in fact, received $164,985.57

on April 22, 2006 for the alleged Loan and mortgage, which fully compensated it for any and all

claims it allegedly might have had related to the rescinded Loan and void mortgage.

47. Defendants persisted in pursuing the Foreclosure Action against Plaintiffs despitehaving failed to reasonably investigate the basis for the exact claims listed in the Foreclosure

Action. Defendants nonetheless persisted in pursuing the Foreclosure Action claims even after

being advised that the Loan had been rescinded and the mortgage was void as a matter of law.

48. Defendants filed and prosecuted the Foreclosure Action against Plaintiffs hereindespite knowing or recklessly disregarding the fact that they lacked any standing whatsoever to

pursue the claims, and furthermore, were not aggrieved and had also in fact been fully

compensated for any and all claims arguably arising from the rescinded Loan.

49. The Foreclosure Action was terminated in favor of the Plaintiffs herein.V. COUNT ONE

Wrongful Use of Civil Proceedings, 42 Pa. C.S. 8351 et seq.

50. Plaintiffs incorporate by reference each preceding and succeeding paragraph asthough more fully set forth at length herein.

51. Plaintiffs were wrongly harassed by Defendants Deutsche Bank and Phelan andhave suffered ascertainable losses as a result of Defendants unlawful conduct as detailed herein.

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52. The conduct of the Defendants, as set forth above, constitutes a wrongful use ofcivil proceedings under 42 Pa. C.S. 8351 et seq. (otherwise known as the Dragonetti Act), in

that the underlying proceedings terminated in the Bakers favor; that the Defendants caused

those proceedings to be instituted and continued without probable cause or reasonable belief; and

finally that the proceedings were instituted for an improper purpose, namely to compel

homeowners to pay a debt they did not owe to a more powerful party under the immediate threat

of eviction from their home.

53. As a direct and proximate result of Defendants wrongful use of civil proceedings,Plaintiffs have suffered ascertainable losses and are entitled to the remedies prayed for above and

recapitulated in the prayer for relief below.

54. Wherefore, Plaintiffs respectfully pray for the following relief:a. That an order be entered declaring that Defendants actions as described above are

in violation of law;

b. Damages for pecuniary losses, emotional distress, harm to credit and title andother damages;

c. Punitive damages according to 42 Pa. C.S. 8353(6);d. The costs, disbursements and attorney fees of this action; ande. Such additional and other relief as the Court may deem just and proper.

VI. COUNT TWO

Abuse of Process

55. Plaintiffs incorporate by reference each preceding and succeeding paragraph asthough more fully set forth at length herein.

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56. Abuse of process is defined as the use of legal process against anotherprimarily to accomplish a purpose for which it is not designed. Defendants (1) used a legal

process against the plaintiffs, (2) primarily to accomplish a purpose for which the process was

not designed, and (3) harm has been caused to the Plaintiffs.

57. Defendants wrongly initiated a civil proceeding against the Plaintiffs with theForeclosure Action (Exh. I), therein suing Plaintiffs for unpaid monthly payments of principal

and interest upon a mortgage due 08/01/2005. Defendants, however, did not in fact own the

Loan. Defendants wrongly claimed that the entire principal balance and all interest due thereon

are collectible forthwith, when Defendant Deutsche Bank did not own the Loan. See Exh. I.

58. Defendants either should have known, or recklessly disregarded, the fact that theyhad absolutely no legal right to initiate a civil proceeding against the Plaintiffs as they did in the

Foreclosure Action. See Exh. I. As described herein, Defendants persisted in pursuing the

Foreclosure Action against Plaintiffs despite having failed to reasonably investigate the basis for

the exact claims listed in the Foreclosure Action. Defendants nonetheless persisted in pursuing

the Foreclosure Action claims even after being advised that the Loan had been rescinded and the

mortgage was void.

59. Furthermore, Defendants wrongly misused the legal process of serving a Noticeof Sheriffs Sale on Plaintiffs and posting it on their home door when, still, Defendants should

have known or recklessly disregarded the fact that they had absolutely no legal right to force a

sale of a home in which they had absolutely no legal interest. See Exh. I (pp. 13-15).

60. As a direct and proximate result of Defendants abuses of process, Plaintiffs areentitled to the remedies prayed for above and recapitulated in the prayer for relief below.

61. Wherefore, Plaintiffs respectfully pray for the following relief:

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EXHIBIT A

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Sarah Baker - Direct 2.160

our loan back with USAA and put it the way things were before1

we spoke to the First Guaranty.2

Q. Okay.3

Now, the -- let me ask you this just directly.4

Did you at any time have a conversation with anyone5

at First Guaranty or WMC or any other third-party indicating6

that you wanted to undo your cancellation of this7

transaction?8

A. Never, never, no.9

Q. Okay.10

Did you have any conversations with your husband11

indicating to him or discussing with him, that you wanted --12

or he wanted -- to undo or rescind this cancellation?13

A. No, not at all.14

Q. Okay.15

After -- well, let me just get some background16

here.17

This loan closing occurred where?18

A. At our house on the back porch -- a beautiful Friday19

evening.20

Q. Okay.21

And Mr. Lewis came with all of the papers, is that22

correct?23

A. Yes.24

Q. All right.25

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And this notice of right-to-cancel form was1

included within those papers, am I right?2

A. Yes, it was.3

Q. Okay.4

What happened next during that weekend after the5

closing occurred at your home?6

A. Well, we were given the package and Mr. Lewis did tell7

us that -- you know -- if we wanted to take the time to look8

at it and make any decisions to -- you know -- go with it or9

if we had any questions or whatever, to take the time that10

weekend to do so.11

My husband -- Im -- Im not as good of a reader as12

my husband is -- but we both did talk about it and we read it13

and he brought out a few things to show me, cause I had14

never personally owned a home before.15

And he said, you know, gosh, look -- look whats16

gonna happen here after two years, this is -- this is17

ridiculous.18

And he explained to me what all that meant and so,19

we decided, well, this isnt a loan that wed want to enter20

into, you know and that -- thats crazy, the -- the terms of21

it were just -- you know -- not ones that we wanted to enter22

into.23

So, we decided to rescind. We just -- it was as24

simple as that, you know, he said to read it, if we have any25

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questions, we did. We decided we didnt want to enter into1

it and we exercised our right to cancel.2

Q. Okay.3

A. It did not say to send it certified, it did not say to4

send it next day air, it just simply said, it had to be5

postmarked by June 7th.6

Q. Okay.7

And thats what you did?8

A. Yes.9

Q. All right.10

After you send the notice out to WMC, you had an11

expectation that WMC would react within twenty calendar days,12

right?13

A. Yes.14

Q. Okay.15

And -- cause thats what said in the sentence of16

D-1, correct?17

A. Right.18

Q. All right.19

Given that expectation that you had, can you tell20

me what, if anything happened next in terms of your dealings21

with this particular transaction?22

A. Absolutely nothing happened.23

Q. Okay.24

But I -- I guess, what Im getting at -- let me25

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EXHIBIT B

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EXHIBIT C

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Diane Taylor - Direct 1.90

MR. EPSTEIN: -- thats her understanding, your Honor.1

THE COURT: Very well. Overruled. Move on.

BY MR. EPSTEIN:4

Q. Ms. Taylor, youre aware that Ms. Baker mailed the notice5

of right to rescind to WMC --6

A. Yes.7

Q. -- on -- yes -- on June 7th, 2005?8

A. Yes.9

Q. Okay.10

And do you know when WMC received that notice of right11

to rescind?12

A. I do not have firsthand knowledge of the exact date, I -- I13

dont.14

Q. Okay.15

Do you know whether it was before WMC funded the loan?16

A. I do believe that it was prior to the funding of the loan,17

yes.18

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EXHIBIT D

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Diane Taylor - Cross 1.154

1

And so, that the date on which it was sold into the --2

to Goldman Sachs -- was 7/29/2005, is that right?3

A. Thats correct.4

Q. Okay.5

And when you sell a transaction to a -- quote/unquote

-- investor, do you deliver documents to the investor reflecting

the transaction?

A. I believe at some point, the file is transferred to the

investor, I dont know at what point.

Q. And that would be the mortgage loan file, is that right?

A. Yes.

Q. Okay.

And did WMC Mortgage Corp., in fact, deliver the -- as

part of the loan file -- the notice of cancellation that the

Bakers had sent in, do you?

A. I do not.

Q. Okay.

Do you know whether it was the policy and practice of

WMC Mortgage Corp. to not deliver a loan file with a notice of

cancellation?

MR. EPSTEIN: Your Honor, Im going to object. Where

is this going as to the relevance of this?

THE COURT:

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EXHIBIT E

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Q. Is this -- this document kept in the ordinary course of1

business by WMC?

A. Yes.

Q. And is it also made in the ordinary course of business by

WMC?

A. Yes.

Q. And is it also made at or near the time of -- of the sale

by WMC?

A. Yes.

Ill -- Ill admit it, it reflects the sale of this12

mortgage -- particular mortgage -- to Goldman Sachs.

(Plaintiff Exhibit 16B received in evidence.)

BY MR. EPSTEIN:

Q. And what is the -- can you please tell the -- the Court the

date and just point out where it shows the date of the sale?

A. (No verbal response.)

And -- and tell us how much WMC sold the mortgage for25

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-- the loan for?1

A. For 159,999.47.2

Q. Okay.3

And where does it re -- and how much profit did it get4

from selling that loan?5

A. $4,399.47.6

Q. Okay.7

And thats reflected on this document?

A. That is correct.

Q. Under premium?

A. Under premium, yes.

Q. Very good.

Please look at Exhibit C -- 16C.

(Pause at 12:01 p.m.)

Q. Did WMC at some point repurchase the loan?

A. Yes, we did.

Q. Okay.

And does Document 16C reflect that repurchase?

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EXHIBIT F

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rescission had been made.1

MR. SCHEFFEL: Objection, your Honor, hearsay, move2

to strike.3

THE COURT: Your response to the hearsay objection?4

MR. DONOVAN: Well, she is reflecting what her5

understanding of the conversation was, shes not offering to6

prove the truth of the matter, whether the woman had no idea7

or not.8

THE COURT: Very well.9

The objection is sustained, the response from the10

person who communicated with her is stricken from the record.11

You may proceed.12

MR. DONOVAN: Okay.13

BY MR. DONOVAN:14

Q. Do you recall this persons name that you spoke to?15

A. I believe her name was Stacy, there was girls that we16

spoke to and one was Stacy and one was Clarissa.17

Q. Okay.18

How did you react to this conversation that you had19

with Stacy?20

A. Well, I -- I was surprised to hear her say that.21

Q. What?22

MR. SCHEFFEL: Objection, again --23

THE COURT: Sustained --24

MR. SCHEFFEL: -- move to strike.25

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THE COURT: -- response stricken.1

You cannot tell me anything that somebody told you2

outside of the courtroom.3

BY MR. DONOVAN:4

Q. Why dont you just tell us what your reaction was, you5

were surprised?6

A. I was surprised that she wasnt aware that we had7

rescinded it.8

Q. Okay.9

MR. SCHEFFEL: Objection, move to strike.10

THE COURT: Sustained.11

(Laughter at 1:52 p.m.)12

THE COURT: Response stricken.13

Q. Did you react with surprise during the phone14

conversation?15

A. Yeah.16

Q. Okay.17

A. Yeah, uh-huh.18

Q. Ah --19

A. And concerned and worried.20

Q. Why were you concerned and worried?21

A. Because we did -- followed our -- exercised our right to22

cancel and she was telling me, that they didnt receive this23

notice, so I was -- obviously --24

THE COURT: Again --25

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because it says that theyre supposed to turn everything back1

in twenty days and they hadnt. And we just wanted to go

back to USAA.

We didnt -- oh, they -- there was within, like,

about three weeks after this whole thing happened, two --

maybe, two weeks, ten days, two weeks -- was when we received

And we asked them at that time, do you want us --8

well, actually, I think we asked them the very first phone9

call -- do you want us to return these checks? Because we10

had no need for them, we didnt want them -- you know -- we11

were not going to enter into this loan.12

13

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at WMC?1

A. Yes, it is.2

Q. And is it also made at or near the -- the time of -- of the3

event by WMC?4

A. Yes, it is.5

MR. EPSTEIN: Your Honor, Id move this also into6

evidence.7

THE COURT: Very well. Any objection?8

MR. DONOVAN: Yes, your Honor.9

I -- I object on the grounds that it -- the -- the10

same basis as I objected to before. Its an redacted document,11

we dont know from where it came.12

THE COURT: But it -- theres other mortgages, thats13

whats being redacted from -- from this document, this --14

MR. DONOVAN: I understand.15

THE COURT: -- pertains to the mortgage in this case,16

which is what interests the Court.17

MR. DONOVAN: You know, you -- you have my objection,18

your Honor, and --19

THE COURT: Very well. Overruled.20

MR. DONOVAN: Yeah.21

MR. EPSTEIN: Very good. Thank you, your Honor.22

(Plaintiff Exhibit 16C received in evidence.)23

BY MR. EPSTEIN:24

Q. Does it reflect the date that WMC repurchased the loan?25

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A. Yes, it does.1

Q. And what date was that?2

A. April 26 -- 22nd, 2006.3

Q. And how much did WMC pay to repurchase the loan?4

A. $164,985.57.5

MR. DONOVAN: Your -- your Honor, are we on -- what --6

are we on 16D?7

MR. EPSTEIN: 16C.8

THE COURT: 16C.9

MR. DONOVAN: Oh, Im sorry, I was -- I was confused10

on it, okay. Fine, thank you.11

BY MR. EPSTEIN:12

Q. And why did they repurchase the loan -- why did WMC13

repurchase the loan?14

A. For early payments default.15

Q. And does it reflect how much WMC in -- in how much -- in16

having to repurchase this loan?17

A. Yes, it does.18

Q. And how much was that?19

A. $9,385.57.20

Q. Okay.21

Please look to 16D.22

(Pause at 12:03 p.m.)23

Q. Did WMC sell the loan after it repurchased it?24

A. Yes, it did.25

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A. Yes, it does.1

Q. And what date was that?2

A. April 26 -- 22nd, 2006.3

Q. And how much did WMC pay to repurchase the loan?4

A. $164,985.57.5

MR. DONOVAN: Your -- your Honor, are we on -- what --

are we on 16D?

MR. EPSTEIN: 16C.

THE COURT: 16C.

MR. DONOVAN: Oh, Im sorry, I was -- I was confused

on it, okay. Fine, thank you.

BY MR. EPSTEIN:

Q. And why did they repurchase the loan -- why did WMC

repurchase the loan?

A. For early payments default.

Q. And does it reflect how much WMC in -- in how much -- in

having to repurchase this loan?

A. Yes, it does.

Q. And how much was that?

A. $9,385.57.

Q. Okay.

Please look to 16D.

(Pause at 12:03 p.m.)

Q. Did WMC sell the loan after it repurchased it?

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Q. Is this -- this document kept in the ordinary course of1

business by WMC?2

A. Yes.3

Q. And is it also made in the ordinary course of business by4

WMC?5

A. Yes.6

Q. And is it also made at or near the time of -- of the sale7

by WMC?8

A. Yes.9

MR. EPSTEIN: Your Honor, I -- Id move to admit.10

THE COURT: Very well.11

Ill -- Ill admit it, it reflects the sale of this12

mortgage -- particular mortgage -- to Goldman Sachs.13

(Plaintiff Exhibit 16B received in evidence.)14

BY MR. EPSTEIN:15

Q. And what is the -- can you please tell the -- the Court the16

date and just point out where it shows the date of the sale?17

A. (No verbal response.)18

Q. Id direct your attention to purchase date --19

MR. EPSTEIN: To help the Court.20

A. Its -- sorry -- its fifteen over purchase date.21

Q. Okay.22

A. 7/29/2005.23

Q. Okay.24

And -- and tell us how much WMC sold the mortgage for25

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-- the loan for?1

A. For 159,999.47.2

Q. Okay.3

And where does it re -- and how much profit did it get4

from selling that loan?5

A. $4,399.47.6

Q. Okay.7

And thats reflected on this document?8

A. That is correct.9

Q. Under premium?10

A. Under premium, yes.11

Q. Very good.12

Please look at Exhibit C -- 16C.13

(Pause at 12:01 p.m.)14

Q. Did WMC at some point repurchase the loan?15

A. Yes, we did.16

Q. Okay.17

And does Document 16C reflect that repurchase?18

A. Yes, it does.19

Q. Okay.20

And now, is this also a document that is made in the21

ordinary course of business at WMC?22

A. When there is repurchase, yes.23

Q. Okay.24

And is it also kept in the ordinary course of business25

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at WMC?1

A. Yes, it is.2

Q. And is it also made at or near the -- the time of -- of the3

event by WMC?4

A. Yes, it is.5

MR. EPSTEIN: Your Honor, Id move this also into6

evidence.7

THE COURT: Very well. Any objection?8

MR. DONOVAN: Yes, your Honor.9

I -- I object on the grounds that it -- the -- the10

same basis as I objected to before. Its an redacted document,11

we dont know from where it came.12

THE COURT: But it -- theres other mortgages, thats13

whats being redacted from -- from this document, this --14

MR. DONOVAN: I understand.15

THE COURT: -- pertains to the mortgage in this case,16

which is what interests the Court.17

MR. DONOVAN: You know, you -- you have my objection,18

your Honor, and --19

THE COURT: Very well. Overruled.20

MR. DONOVAN: Yeah.21

MR. EPSTEIN: Very good. Thank you, your Honor.22

(Plaintiff Exhibit 16C received in evidence.)23

BY MR. EPSTEIN:24


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Diane Taylor - Cross 1.162

1

Now, the resale date is -- I -- where on this7

document, 16D do we see the resale date?8

A. Under purchase date.9

Q. Okay.10

So, thats 6/2/2006?11

A. That is correct.12

Q. Okay. All right.13

If I understand your testimony correctly, as of14

6/2/2006. GMAC -- what did you call it, GMAC Non-performing?15

A. Yes.16

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Complaint (Baker) Common Pleas Corrected

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Transcript of Complaint (Baker) Common Pleas Corrected