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IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT IN AND FOR COLLIER COUNTY, FLORIDA

JENNIFER FRANKLIN-PRESCOTT, WALTER PRESCOTT, JOHN DOE, MARY DOE,

Counterclaimants, vs. PREVIOUSLY DISPOSED CASE NO.: 09-6016-CA BANKUNITED [non-successor in interest to bankrupt “BANKUNITED, FSB”], DANIEL R. MONACO (personal & official capacity), CLERK OF COURT (personal & official capacity), ALBERTELLI LAW,

Defendants on Counterclaim(s). _____________________________________________________________________________/

COUNTERCLAIM(S) AND DEMAND FOR TRIAL BY JURY

DEMAND FOR AFFIRMATIVE RELIEF IN ADDITION TO AFFIRMATIVE DEFENSES

DISPOSED WRONGFUL FORECLOSURE ACTION WAS NEVER AT ISSUE

1. Here, the previously disposed action/complaint was never at issue, but the court abused its

discretion and set it for non-jury trial and “ordered” the “defendants” to “respond” after the

unlawful amended, and then cancelled “02/22/2011 hearing”.

MISREPRESENTATION: BENCH TRIAL WOULD VIOLATE DUE PROCESS

2. Pursuant to Fla. R. Civ. P. 1.440, this action was not even at issue and could not possibly be

set for non-jury trial. Here, “defendants” were entitled to dismissal and the hearing of their

motions to dismiss. Here, this action had been disposed on 08/12/2010 and was not ready to

be set for trial. Retired “robo” Judge Monaco has been in the pocket of the bank(s), and the

Court violated said Rule.

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3. Any order setting this disposed case for “trial” would have to be sent to the

counterclaimants by the trial court in order to assure due process.

4. Counterclaimants assert the following: (1) that they did not receive any order; and/or (2) that

without having received an order in an envelope mailed by this Court, it created doubt as to

the order's authenticity; and/or (3) that the unauthorized “trial” would commence less than

30 days from the receipt of the order.

5. Apparently here, “robo” Judge Monaco seeks to deprive the defendants of due process.

6. Strict compliance with Florida Rule of Civil Procedure 1.440 is required and failure to do

so is reversible error. Ramos v. Menks, 509 So. 2d 1123 (Fla. 1st DCA 1986); Bennett v.

Continental Chemicals, Inc., 492 So. 2d 724 (Fla. 1st DCA 1984).

7. Counterclaimants have had a due process entitlement to notice and an opportunity to be heard

pursuant to Florida Rule of Civil Procedure 1.440. Bowman v. Kingsland Development, Inc.,

432 So. 2d at 663.

8. Here, counterclaimants’ fundamental due process rights are being violated by the defective

notice of (non)-jury trial.

KNOWN LACK OF JURISDICTION

9. To allow “BankUnited” to sue defendants/counterclaimants in the previously disposed

wrongful foreclosure action, the court would have to determine that the destroyed/lost notes

and mortgages were valid, genuine, enforceable, and owned by “BankUnited”.

10. Here, Daniel R. Monaco knew and/or concealed that, e.g., the missing instruments were not

enforceable and null & void, and that the Court had no jurisdiction.

[IMPOSSIBLE] REESTABLISHMENT DEMANDED JURY TRIAL

11. Count I of the complaint demanded trial by jury [reestablishment of an alleged destroyed and/or lost note and mortgage. The time and manner of the loss/destruction were

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UNKNOWN]. Here, “BankUnited” and the Court knew that reestablishment was legally impossible.

COUNTERCLAIM(S) AT COMMON LAW AND DEMAND FOR JURY TRIAL

12. The Counterclaim(s) is in four Counts and consists of

COUNT I: A suit for damages for fraud and misrepresentation;

COUNT II: An action to quiet title to certain real property;

COUNT III: A suit seeking damages for breach of contract; and

COUNT IV: An action for damages.

Specifically, the counterclaimants and/or counterclaims demand trial by jury on all

issues so triable.

13. Pursuant to Rule 1.170, the counterclaimants have claims for affirmative relief against

“BankUnited”, Albertelli Law, Daniel R. Monaco, and the Clerk of Court.

14. In this previously disposed case, the complaint sought to reestablish destroyed/lost

instruments and foreclose an alleged destroyed/lost mortgage/note on certain real property

(25 6TH Street North Naples, FL), which is in the possession of the defendant

counterclaimants.

15. While the previously disposed wrongful foreclosure suit appears to be equitable in nature,

Count I of the complaint (facially impossible reestablishment after UNKNOWN

destruction/loss of alleged instruments) and the counterclaims are based on the exhibits and

assertions that the recorded version and other versions of the instruments conflicted with

each other and were based on fraud and were, in fact, a forgery.

COUNT 1 AGAINST “BANKUNITED”:

SUIT FOR DAMAGES FOR FRAUD AND MISREPRESENTATION

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16. “BankUnited” deceived the counterclaimants with regard to the true legal ownership and

enforceability of the alleged destroyed and/or lost instruments. Here as a matter of law, it

was impossible to reestablish the missing alleged instruments, and the counterclaimants

were entitled to protection and dismissal of the prima facie frivolous and insufficient

complaint.

17. Here, “Walter Prescott” was not the maker of any alleged promissory note dated February 15,

2006, or any other promissory note, as evidenced by the exhibits attached to the complaint.

18. Walter Prescott was not the maker of any “loan modification agreement” as evidenced by the

December 2010 Notice of Filing of Original Loan Modification Agreement on file.

COURT’S KNOWN LACK OF JURISDICTION

19. The purported “plaintiff”, “BankUnited”, has not alleged facts sufficient to demonstrate that

it invoked and/or could have possibly invoked the jurisdiction of this court. Here, plaintiff did

not satisfy and could not have possibly satisfied the required conditions precedent as

evidenced by the file. Here, the falsely alleged “promissory note and mortgage have been lost

or destroyed and are not in the custody or control of ‘BankUnited’, and the time and

manner of the loss or destruction is unknown.”

“BANKUNITED” MADE FALSE CLAIMS TO DEFRAUD THE COUNTERCLAIMANTS

20. Purported “plaintiff” “BankUnited” does not own and hold any genuine note and mortgage.

21. “BankUnited” failed its burden to affirmatively establish holder in due course status

pursuant to Florida law and Seinfeld v. Commercial Bank & Trust Co., 405 So.2d 1039-

41 (Fla. 3d DCA 1981).

22. Here, “BankUnited” even pleaded inability to establish holder in due course status because

of the UNKNOWN loss and/or destruction of the alleged instruments.

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23. After the pleaded UNKNOWN destruction and loss of the purported note and mortgage

pursuant to paragraph 6 of the complaint, no legal and factual questions were and could

possibly have been at issue here:

“6. Said promissory note and mortgage have been lost or destroyed and are not in the custody or control of BankUnited, and the time and manner of the loss or destruction is UNKNOWN.”

24. Here, there was no evidence as to WHO possessed the note WHEN it was lost/destroyed.

25. Here, the undisputed evidence was that “BankUnited, FSB” did not have possession of the

alleged destroyed/lost instruments, and thus, could not enforce the note under section

673.3091 governing lost/destroyed notes/instruments. Because “BankUnited, FSB” could

not enforce the lost instruments under section 673.3091, it had no power of enforcement

which it could possibly assign and/or transfer to “BankUnited”.

26. [Were this Court to allow “BankUnited” to enforce the alleged lost instruments, because

some unidentified person further back in the chain may have possessed the note, it would

render the rule of law and 673.3091 meaningless.]

27. The alleged mortgage copy did not contain a copy of the alleged executed note.

28. “BankUnited” fraudulently prayed for reestablishment, no order reestablishing the lost

instruments was entered, and the wrongful action was disposed on 08/12/2010.

29. As a matter of law, reestablishment of the note was impossible under Ch. 673, Florida

Statutes, and the Uniform Commercial Code.

30. “BankUnited” is not in possession of the purported note and mortgage and not entitled to

enforce them.

31. “BankUnited” did not know WHO destroyed and/or lost the instruments WHEN and

HOW.

32. “BankUnited” which is wrongfully seeking to enforce the alleged note and mortgage was

not entitled to enforce the alleged instruments WHEN the UNKNOWN loss and/or

destruction of the alleged instruments occurred.

33. “BankUnited” did not acquire ownership of the instruments from anyone who was entitled to

enforce the alleged instruments WHEN the UNKNOWN loss and/or destruction of the

alleged instruments occurred. See § 673.3091, Florida Statutes (2010).

34. On 05/21/2009, “BankUnited, FSB” was seized.

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35. Here, there had been seizure and transfer which prohibited re-establishment.

36. “BankUnited” never produced nor re-established any authentic note and/or mortgage as

proven by the evidence before this Court.

37. The mortgage that was used to establish the terms of the allegedly lost note and mortgage

was controverted and challenged as to authenticity and alteration of its original terms.

38. This Court knew that “BankUnited’s” facially fraudulent affidavits were sham.

39. A person seeking enforcement of an instrument under UCC § 3-309(a)(b) must prove the

terms of the instrument and the person’s right to enforce the instrument.

40. “BankUnited” had to, but failed, to prove the terms of the alleged instruments and the

person’s right to enforce the alleged instruments.

41. Here, “BankUnited” failed to prove any terms, and the terms of the alleged obligation and/or

instrument were vague and ambiguous.

42. Here, Walter Prescott neither executed the purported note nor “loan modification agreement”.

FRAUDULENT, NULL, AND VOID “AFFIDAVITS”

43. This Court may not enter judgment in favor of “BankUnited”, because the Court knew that

the defendant counterclaimants are not adequately protected against loss and “BankUnited’s”

fraud on the Court by means of, e.g., null and void affidavits.

a. Controverted by the record evidence, “BankUnited” fraudulently stated under oath that

said disposed wrongful action was “uncontested” and allegedly devoid of genuine issues

of material fact. See, e.g., “Affidavit of Plaintiff’s Counsel as to attorney’s fees and costs”.

b. The “Albertelli Law” foreclosure mill employed unlawful “robo-signers” and “robo-

signing” schemes.

c. Barbie Fernandez fraudulently stated under oath, e.g., that BankUnited is the owner or

servicer for the owner of the lost/destroyed and non-reestablished instruments. See

“Affidavit as to amounts due and owing”;

d. Ashley Simon, Esq., stated under oath, e.g., that she had “not reviewed the actual file in

this case”. See “Affidavit as to reasonable attorneys fees”.

44. On the clear evidence presented and before this Court, “plaintiff” “BankUnited” had no

standing and no real interest, and this previously disposed wrongful foreclosure action

cannot be tried and/or adjudged under the Rules and Florida Statutes.

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45. Defendant counterclaimants did not default under the destroyed and/or lost note and

mortgage, and no payment was due to “BankUnited”.

46. “BankUnited” failed to assert any chain of title and/or assignment of the destroyed/lost note

and mortgage.

ALLEGED DESTROYED / LOST INSTRUMENTS / “LOAN MODIFICATION”

47. Section 673.4071, Alteration, Florida Statutes (2010), states in pertinent part:

(1)The term “alteration” means: (a)An unauthorized change in an instrument which change purports to modify in any respect the obligation of a party; or (b)An unauthorized addition of words or numbers or other change to an incomplete instrument which addition or change relates to the obligation of a party. (2)Except as provided in subsection (3), an alteration fraudulently made discharges a party whose obligation is affected by the alteration unless that party assents or is precluded from asserting the alteration. No other alteration discharges a party, and the instrument may be enforced according to its original terms. (3)A payor bank or drawee paying a fraudulently altered instrument or a person taking it for value, in good faith and without notice of the alteration, may enforce rights with respect to the instrument according to its original terms or, in the case of an incomplete instrument altered by unauthorized completion, according to its terms as completed.

48. Fraud was specifically articulated in United States v. Throckmorton, 98 U.S. 61, 65-66, 25

L. Ed. 93 (1878), in which the United States Supreme Court said:

Where the unsuccessful party has been prevented from exhibiting fully his case, by fraud or deception practiced on him by his opponent, as by keeping him away from court, a false promise of a compromise; or where the defendant never had knowledge of the suit, being kept in ignorance by the acts of the plaintiff; or where an attorney fraudulently or without authority assumes to represent a party and connives at his defeat; or where the attorney regularly employed corruptly sells out his client's interest to the other side--these, and similar cases which show that there has never been a real contest in the trial or hearing of the case, are reasons for which a new suit may be sustained to set aside and annul the former judgment or decree, and open the case for a new and a fair hearing. (Citations omitted.)

Consistent with the general rule, Florida Courts have defined fraud as the

prevention of an unsuccessful party [from] presenting his case, by fraud or deception practiced by his adversary; keeping the opponent away from court; falsely promising a compromise; ignorance of the adversary about the existence of the suit or the acts of the plaintiff; fraudulent representation of a party without his consent and connivance in his defeat…

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COUNT I: FRAUD COUNTERCLAIM AGAINST DANIEL R. MONACO

49. The counterclaimants are suing retired “robo” Judge Daniel R. Monaco in his private

individual and official capacity. Here, Monaco exceeded the scope of any official capacity

when he, e.g., overturned Judge Hayes’ previous 08/12/2010 disposition.

50. Here, “BankUnited’s” and Daniel R. Monaco’s conduct were collateral to the allegations,

exhibits, and issues complained of.

51. Retired temporary Judge D. R. Monaco had no authority to, e.g.:

a. overturn the 08/12/2010 disposition by [Disposition] Judge Hugh D. Hayes in the

absence of the court’s jurisdiction;

b. deny dismissal after the previous disposition by Judge Hayes;

c. preside over an amended and then cancelled illegal hearing on 02/22/2011 in the

excused absence of the counterclaimants.

JUDICIAL ABUSE OF DISCRETION AND UNCONSTITUTIONAL ORDER

52. Thus, retired “robo” Judge Monaco’s non-jury trial did not square with the requirements of

the governing Constitutions and Statutes.

53. Accordingly, a jury trial on all issues triable by jury must be granted.

54. Monaco and/or the Court knew that claims in which fraud is an issue should not be resolved

by summary judgment. See Barrios v. Duran, 496 So.2d 239 (Fla. 3d DCA 1986).

DISPOSED CASE WAS NEVER AT ISSUE -TRIAL WOULD VIOLATE DUE PROCESS

55. Pursuant to Fla. R. Civ. P. 1.440, this action was not even at issue and could not possibly be

set for trial. Here, the counterclaimants were entitled to dismissal and the hearing of their

motions to dismiss. Here, this action had been disposed on 08/12/2010 and was not ready to

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be set for trial. Retired “robo” Judge Monaco has been in the pocket of the bank(s), and the

Court violated said Rule.

56. Any order setting this disposed case for “trial” would have to be sent to the defendant

counterclaimants by the trial court in order to assure due process.

57. The counterclaimants assert the following: (1) that they did not receive any order; and/or (2)

that without having received an order in an envelope mailed by this Court, it created doubt

as to the order's authenticity; and/or (3) that the unauthorized “trial” would commence less

than 30 days from the receipt of the order.

58. Apparently here, “robo” Judge Monaco seeks to deprive the defendant counterclaimants of

due process.

59. Strict compliance with Florida Rule of Civil Procedure 1.440 is required and failure to do

so is reversible error. Ramos v. Menks, 509 So. 2d 1123 (Fla. 1st DCA 1986); Bennett v.

Continental Chemicals, Inc., 492 So. 2d 724 (Fla. 1st DCA 1984).

60. The counterclaimants have had a due process entitlement to notice and an opportunity to be

heard pursuant to Florida Rule of Civil Procedure 1.440. Bowman v. Kingsland

Development, Inc., 432 So. 2d at 663.

61. Here, counterclaimants’ fundamental due process rights are being violated by the defective

notice of (non)-jury trial.

“ROCKET DOCKET” – FRAUD & SPEED INSTEAD OF JUSTICE

62. It is well established that fraud and misrepresentation are valid affirmative defenses in a

foreclosure action. See Lake Regis Hotel Co. v. Gollick, 110 Fla. 324, 149 So. 204 (1933)

(misrepresentation). Fraud is also a legal action for damages that can be raised as a

counterclaim. See Spring v. Ronel Refining, Inc., 421 So.2d 46 (Fla. 3d DCA 1982).

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63. Fraud is a compulsory counterclaim to an action in foreclosure on the [here

lost/destroyed] note and/or mortgage. See Spring, supra; Yost v. American Nat'l Bank, 570

So.2d 350 (Fla. 1st DCA 1990). Fraud claims are compulsory counterclaims for purposes of

Florida Rule of Civil Procedure 1.170.

64. Here without any rational and legal explanation/justification, Monaco/the Court has been

speeding from the 08/12/2010 disposition to “trial” to favor the bank at counterclaimant

homeowners’ expense. The counterclaimants experienced and fear further prejudice.

65. To grant any judgment of foreclosure in favor of “BankUnited”, the Court/Monaco would

have to find, among other things, that said bank owned the lost/destroyed mortgage/note and

had performed all conditions precedent to enforce the destroyed/missing mortgage/note.

66. However here, “BankUnited” had asserted the UNKNOWN loss and/or destruction of the

purported instruments in its complaint. Furthermore, the evidence on file had conclusively

proven non-performance of said conditions. See generally 37 Fla. Jur. 2d Mortgages and

Deeds of Trust § 287 (2002).

67. If arbitrarily and capriciously, after the 08/12/2010 disposition, the foreclosure action

were to proceed to judgment in favor of “BankUnited”, then a jury would be bound by these

findings of fact, which facts are inextricably interwoven with the issues presented by the

defendant counterclaimants’ affirmative defenses and counterclaims. Thus, to allow the

foreclosure action to proceed before the petitioners' legal counterclaims would deny them

their fundamental right to a jury trial, which they have demanded, on those issues.

TEMPORARY “ROBO JUDGE MONACO IS BIASED IN FAVOR OF BANK(S)

68. Here, retired “robo” Judge Monaco knew and/or concealed that a plaintiff must be the

owner/holder of the instrument(s) as of the date of filing suit pursuant to Jeff-Ray Corp. v.

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Jacobsen, 566 So. 2d 885 (Fla. 4th DCA 1990); WM Specialty Mortgage, LLC v. Salomon,

874 So. 2d 680, 682 (Fla. 4th DCA 2004).

69. Here as of “07/09/2009”, the date of filing suit, “BankUnited” was not any holder and/or

owner of nor entitled to enforce the destroyed and/or missing instruments.

70. “BankUnited” was not a holder of the lost/destroyed note at the time it wrongfully filed suit

(07/09/2009) or any time thereafter, was not entitled to enforce and/or reestablish the alleged

lost instruments, and no exception to this requirement was ever asserted. See Am. Bank of

the S. v. Rothenberg, 598 So. 2d 289, 291 (Fla. 5th DCA 1992) (finding that it is elementary

that to be a holder, one must be in possession of the instrument).

71. Here, “BankUnited” had neither standing nor any real interest and could not have possibly

enforced the lost and/or destroyed instruments.

72. Here, retired Judge Monaco and “BankUnited” had actual knowledge of the fraud and lack

of good faith prior to the falsely alleged transfer from “BankUnited, FSB” to “BankUnited”,

which precluded “BankUnited” from claiming holder in due course status.

73. Here, temporary Judge Monaco knew and/or concealed that Prescott had controverted the

authenticity of the purported note amd that “defendant” Walter Prescott had not executed the

alleged note pursuant to the evidence on file.

74. Here no mortgage could possibly secure a non-existing obligation.

COUNT I: FRAUD COUNTERCLAIM AGAINST CLERK OF COURT

75. The counterclaimants are suing the Clerk of Court in his private individual and official

capacity. Here, said Clerk exceeded the scope of any official capacity.

LACK OF AUTHORITY TO REMOVE 08/12/2010 JUDICIAL DISPOSITION

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76. The “02/21/2011 memorandum from clerk to file regarding correction of the disposition

record to reflect the case as pending” was unauthorized and lacked any legal justification.

77. Here, the wrongful foreclosure action had been disposed by “Disposition Judge” H. D.

Hayes (disposition was reached by said Judge in a case that was not dismissed and in which

no trial has been held; Category (J). The Clerk and Daniel R. Monaco had no authority to

remove/overturn the 08/12/2010 judicial disposition record without any legal justification.

78. The Clerk had no judicial authority and was not to practice law at counterclaimants’ expense.

COUNT I: SUIT FOR DAMAGES FOR FRAUD AGAINST ALBERTELLI LAW

FRAUD ON THE COURT ON THE RECORD

79. After the 08/12/2010 disposition, Albertelli Law and/or “BankUnited” “filed” the

“original note” which did not identify “BankUnited” as the holder or lender.

80. Albertelli Law and “BankUnited” also did not attach an assignment or any other evidence to

establish that it had purchased and/or acquired the alleged lost note and mortgage.

81. Here, Albertelli Law concealed that the required chain of title was not in evidence.

82. Furthermore, “BankUnited” did not file any genuine supporting affidavits or deposition

testimony to establish that it owns and holds the alleged lost/destroyed note and mortgage

but re-filed non-authentic copies of the lost/destroyed instrument(s).

83. Accordingly, the documents before this court and retired “robo” Judge Monaco at the

22/02/2011 unauthorized and cancelled hearing did not establish “BankUnited’s” standing

to foreclose the destroyed/lost note and mortgage, Thus, at this point, “BankUnited” was not

entitled to any “trial” and any “judgment” in its favor.

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RECORD LACK OF ADMISSIBLE EVIDENCE IN DISPOSED WRONGFUL ACTION

84. Defendants did not execute and deliver an authentic promissory note and mortgage to

“BankUnited”.

85. Under Florida law delivery is necessary to validate a negotiable instrument.

86. Here, neither any note nor mortgage were assigned and delivered to “BankUnited”.

87. Here there was no delivery of any written assignment of any instrument to “BankUnited”.

“BANKUNITED” FAILED TO STATE A CAUSE OF ACTION & HAD NO STANDING

88. On or around 07/09/2009, Alfred Camner, Esq., the troubled founder of bankrupt and seized

“BankUnited, FSB”, had alleged unknown loss and/or destruction of a purported note and/or

mortgage.

89. Here because Alfred Camner was the bankrupt bank’s founder, it was as if “BankUnited,

FSB” had asserted the loss/destruction of the alleged instruments.

90. Thereafter, Alfred Camner, Esq., Serena Kay Paskewicz, Esq., and/or the Camner Lipsitz Law

Firm were fired.

CONCEALMENT OF LOST AND/OR DESTROYED F.D.I.C. RECORDS

91. Here, Albertelli Law knew that a federal depository institution regulatory agency [F.D.I.C.]

was confronted with a purported lost agreement and/or instruments not documented in the

institution's records.

92. No agreement/instruments between a borrower and a bank, which does not plainly appear on

the face of an obligation or in the bank's official records is enforceable against the Federal

Deposit Insurance Corporation.

93. It makes no difference whether the issue is presented in the form of a claim or of a defense;

as long as the claim or defense is based upon an alleged agreement the terms of which are

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not contained within the four corners of the written obligation or found in the official records

of the financial institution, the claim or defense is barred. See, e.g., Langley v. FDIC, 484

U.S. 86, 91-92, 108 S. Ct. 396, 401, 98 L. Ed. 2d 340, 347 (1987).

94. Said rule was codified by the Federal Deposit Insurance Act of 1950, § 13(e), 64 Stat. 889, as

amended, 12 U.S.C. § 1823(e).

95. Here, the Court was obligated to determine and/or consider the lack of subject matter

jurisdiction as invoked by federal law.

RECORD FRAUD UPON THE COURT

96. "'Fraud upon the court' is a special kind of fraud, more serious in scope and implication

than fraud sufficient for relief under Federal Rule of Civil Procedure 60(b)(3) [Florida Rule

of Civil Procedure 1.540(b)(3)] or as a ground for an 'independent action." See 7 J. Moore &

J. Lucas, Moore's Federal PracticeP60.31-33 (2d ed. 1983); P60.33 at 515. See also Dankese

Engineering, Inc. v. Ionics, Inc., 89 F.R.D. 154 (D.Mass. 1981).

97. Thus, where an action is grounded on "fraud upon the court," traditional principles of

equity, the failure of the seeker of equity to do equity, etc., see, e.g., Kearley v. Hunter, 154

Fla. 81, 16 So.2d 728 (1944), which might disentitle one to relief, are not applied. As

Professor Moore notes: "The court must also distinguish between relief for 'fraud upon the

court,' for which there is no time limit, from relief by motion, for which there is a one-year

limitation, and from relief by independent action, which is limited only by laches." Moore's,

supra, P6.

RECORD OBJECTIONS TO UNCONSTITUTIONAL NON-JURY/BENCH TRIAL

98. The defendant counterclaimants objected to a non-jury trial, pointing out that they have been

demanded a jury trial, and again ask that the case be set for resolution before a jury.

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99. The court failed to communicate and notice the counterclaimants.

100. Section 22 of the Declaration of Rights contained within the Florida Constitution begins

by declaring that "The right of trial by jury shall be secure to all and remain inviolate." See

also Amend. VII, U.S. Const. Rule 1.430, Florida Rules of Civil Procedure also provides that

"The right of trial by jury as declared by the Constitution or by statute shall be preserved to

the parties inviolate."

101. In the present case, Count I was at law for reestablishment of an alleged destroyed

and/or lost note and mortgage. The time and manner of the loss/destruction were

UNKNOWN.

102. The counterclaims are unquestionably suits at law seeking damages, the traditional

realm of the civil jury trial.

103. Thus, the issue with which this Court and its “rocket docket” must come to grips, then,

is how to secure inviolate counterclaimants’ rights of jury trial.

104. The claims at law are intermixed with the previously disposed wrongful foreclosure

action.

105. In the record absence of any [reestablished] instruments, “BankUnited” had failed to

state a cause of action, had no standing, and could not foreclose and sue.

106. Florida’s appellate courts had previously addressed intermixed causes: Spring v. Ronel

Refining, Inc., 421 So. 2d 46 (Fla. 3d DCA 1982); Adams v. Citizens Bank of Brevard, 248

So. 2d 682, 684 (Fla. 4th DCA 1971). The Spring court cited to Adams, in which the District

Court held that:

[I]f a compulsory legal counterclaim entitles the counter-claimant to a jury trial on issues which are not common to any issue made by the equitable complaint, the trial court should proceed to try the equitable issue non-jury with appropriate provision made for a jury trial as to the law issues if disposition of the equitable issues does not

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conclude the case. But where the compulsory counterclaim entitles the counter-claimant to a jury trial on issues which are sufficiently similar or related to the issues made by the equitable claim that a determination by the first fact finder would necessarily bind the latter one, such issues may not be tried non-jury by the court since to do so would deprive the counter-claimant of his constitutional right to trial by jury.

Here on 08/12/2010, the wrongful foreclosure action had been disposed. Here, Count I of

the complaint and the counterclaims were at law, and counterclaimants have been

demanding jury trial.

COUNT II – SUIT TO QUIET TTILE TO CERTAIN REAL PROPERTY

107. The second Count of the counterclaim(s) seeks to quiet title to said real property that is

the subject of the destroyed/lost and non-reestablished instruments referenced in the facially

frivolous and insufficient complaint.

DEMAND OF JURY TRIAL - QUIET TITLE / EJECTMENT ACTION(S)

108. In this instance, Florida's quiet title statute specifically authorizes a trial by jury. Section

65.061(1), Florida Statutes (2010), provides in pertinent part that:

…if any defendant is in actual possession of any part of the land, a trial by jury may be demanded by any party, whereupon the court shall order an issue in ejectment as to such lands to be made and tried by a jury…

Thus, in Westview Community Cemetery of Pompano Beach v. Lewis, 293 So. 2d 373 (Fla.

4th DCA 1974), the court held that because a defendant on the counterclaim was a defendant

in actual possession of the land in question, either party was entitled to a jury trial on the

issues presented.

109. Counts 1 and 3 of the counterclaim are actions for damages for fraud and breach of

contract, both of which are common law actions for damages. Because here the causes of

action were intimately intertwined with the previously disposed equitable foreclosure claim

contained in the complaint, there was no question that the counterclaimants were entitled to

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a jury trial on the issues raised by these counts in advance of any non-jury trial on the

previously disposed equitable matters.

COUNT III- SUIT FOR DAMAGES FOR BREACH OF CONTRACT

110. The counterclaimants are suing for breach of contract based on “BankUnited’s” record

actions of filing untrue affidavits and failure to account.

111. “BankUnited” materially breached its duty of good faith and fair dealing, which

resulted in proximate damages.

FACIALLY FRAUDULENT ACCOUNTING & NULL & VOID AGREEMENT

112. As witnessed and/or notarized, the alleged destroyed/lost “loan modification

agreement” was not signed and executed by “defendant” Walter Prescott and therefore

unenforceable (not legally binding).

113. Even though said “modification agreement” was not legally binding, “BankUnited”

wrongfully sought to enforce the null & void “agreement”:

“The interest rate required by this section 1 (7.625%) is the rate I will pay both before and after any default described in the note.”

Here, the October 2010 “Affidavit as to amounts due and owing” fraudulently stated a

“7.625% interest rate”.

114. The “modified” mortgage was never recorded, and there was no evidence of taxes paid,

which rendered the alleged lost mortgage unenforceable.

BANK KNEW OF RECORD ABSENCE OF CONTRACTUAL OBLIGATION

115. Even if the parties had entered into a new contract, it could not have been legally

substituted for the old contract unless there had been a novation. Here, there were no

contract and no novation.

"A novation is a mutual agreement between the parties for the discharge of a valid existing obligation by the substitution of a new valid obligation." See Jakobi v. Kings

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Creek Vill. Townhouse Ass'n, 665 So. 2d 325, 327 (Fla. 3d DCA 1995) (citing Ades v. Bank of Montreal, 542 So. 2d 1013 (Fla. 3d DCA 1989)).

“BankUnited” did not prove the substitution of the alleged new contract for the old and did

not show the four required elements of: (1) the existence of a previously valid contract; (2)

the agreement of the parties to cancel the first contract; (3) the agreement of the parties that

the second contract replace the first; and (4) the validity of the second contract. Id.

Here, the intention of “BankUnited” did not support novation, and the alleged lien was lost,

destroyed, and/or invalid, and the previously disposed foreclosure action wrongful.

DEMAND FOR JURY TRIAL & MEMO BY DEFENDANT COUNTERCLAIMANTS

DEFENDANTS’ COUNTERCLAIM & DEMAND FOR JURY TRIAL

116. Defendants’ affirmative defenses defeated the disposed action by a denial and/or

avoidance. “Defendants” admitted the UNKNOWN loss and/or destruction of the alleged

instruments, which could not be reestablished as a matter of law. See Schupler v.Eastern

Mortgage Co., 160 Fla. 72, 33 So.2d 586 (1948); Lovett v. Lovett, 93 Fla. 611, 112 So. 768

(1927).

117. In addition, defendants filed a counterclaim and/or cause of action that seeks

affirmative relief. The counterclaim and affirmative defenses were separate and distinct

events. 118. Here, “plaintiff” “BankUnited” had failed to state a cause of action, and the court could

not grant [summary] judgment because the defendants have asserted legally sufficient

affirmative defenses that have not been rebutted. See Ton-Will Enterprises, Inc. v. T & J

Losurdo, Inc., 440 So.2d 621 (Fla. 2d DCA 1983).

119. Here, “BankUnited” did not dispute that it failed to rebut defendants’ affirmative

defenses.

19

120. Here, Defendants’ action/compulsory counterclaim for, e.g., damages for fraud and

breach of contract, were both common law actions for damages.

121. Thus, this court erred by ignoring defendants’ affirmative defenses and denying

defendants’ motion to dismiss during an illegal “02/22/2011 hearing” which had been

cancelled.

DEFENDANT COUNTERCLAIMANTS ARE ENTITLED TO JURY TRIAL

122. Here, the compulsory counterclaim entitled the defendant counter-claimants to

a jury trial on issues which are sufficiently similar or related to the issues made by the

previously disposed foreclosure claim that a determination by the first fact finder would

necessarily bind the latter one. Therefore, the issues may not be tried non-jury by the court

since to do so would deprive the defendant counter-claimants of their constitutional rights

to trial by jury.

123. Here, the issues and/or affirmative claims involved in the compulsory counterclaim

and/or fraud claim were sufficiently similar to the issues in the foreclosure action stated in

the complaint to require a jury trial of the claim at law before the equitable claims could

possibly be reached. Only after a jury verdict on the common law issues could the trial

court dispose of the equitable issues that were remaining.

124. Here, the rule is that even where a complaint lies solely in equity, the filing of a

compulsory counterclaim seeking remedies at law entitles the counterclaimant(s) to

a jury trial of the legal issues. See Widera v. Fla. Power Corp., 373 So. 2d 714 (Fla. 2d DCA

1979); Sarasota-Manatee Airport Auth. v. Alderman, 238 So. 2d 678 (Fla. 2d DCA 1970).

20

125. “Defendants” were entitled to a jury trial on issues raised in their compulsory

counterclaim that are common to the previously disposed foreclosure claim. See Hightower

v. Bigoney, 156 So.2d 501 (Fla. 1963); Spring, supra.

126. This court cannot determine the factual issues of fraud and misrepresentation without

evidence and without a fact-finding jury.

127. Thus, the Court must first resolve the affirmative claims and defenses of fraud and

misrepresentation. Any other way would be error.

128. Here after the capricious removal of the 08/12/2010 disposition record, the prejudice

is especially predictable and the legal issues must be tried by jury. The defendants

demanded recusal for fear of further bias.

APPEAL AFTER PREJUDICIAL AND UNLAWFUL “02/22/2011 HEARING”

129. The defendants in this disposed wrongful mortgage foreclosure action appealed the

order(s) entered at the illegal and cancelled “02/22/2011 hearing”.

130. In this disposed action, and in the absence of any re-opening, this court improperly

handled disputed factual issues raised in the affirmative defenses and compulsory

counterclaim when it set a “trial” during said unlawful “hearing”.

RECORD PREJUDICE AND ERROR

131. Here, it would be error to proceed with the previously disposed wrongful foreclosure

action before jury trial on the interrelated legal counterclaim(s).

132. This court did not have the discretion to deny the demanded jury trial on these factual

issues and Motion(s) to Dismiss after the 08/12/2010 disposition.

DEFENDANT COUNTERCLAIMANTS DEMANDED JURY TRIAL

133. Defendant counterclaimants had demanded trial by jury.

21

134. Defendants are entitled to trial by jury on, e.g., Count I of Plaintiff’s complaint

(reestablishment of lost instruments).

135. Here, defendants have a fundamental right to jury trial in Florida’s State Courts.

136. The Florida Constitution expressly provides for the right to trial by jury. Article I,

Section 22, of the Florida Constitution provides:

§ 22. Trial by Jury The right of trial by jury shall be secure to all and remain inviolate. The qualifications and the number of jurors, not fewer than six, shall be fixed by law.

137. Art. I, § 22, Fla. Const. Similarly, the Seventh Amendment of the United States Constitution provides:

In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise reexamined in any Court of the United States, than according to the rules of the common law.

Amend VII, U.S. Const.

138. Florida courts have consistently highlighted the importance of the right to a trial by

jury. 139. "Questions as to the right to a jury trial should be resolved, if at all possible, in favor of

the party seeking the jury trial, for that right is fundamentally guaranteed by the U.S.

and Florida Constitutions." Hollywood, Inc. v. City of Hollywood, 321 So. 2d 65, 71 (Fla.

1975); see also Hansard Constr. Corp. v. Rite Aid of Fla., Inc., 783 So. 2d 307, 308 (Fla. 4th

DCA 2000) ("Questions regarding the right to a jury trial should be resolved in favor of a

jury trial…") (citing King Mountain Condo Ass'n v. Gundlach, 425 So. 2d 569 (Fla. 4th

DCA 1982)).

MEMORANDUM OF LAW IN SUPPORT OF JURY TRIAL – “REESTABLISHMENT”

140. When a plaintiff brings a count “in law and in equity” to re-establish a note and/or for

deficiency judgment against the defendants, defendants have a right to a jury trial.

22

141. A complaint to re-establish a lost note and to have a personal decree against the

defendant(s) for the amount of debt to be evidenced by the re-established note is without

equity, because the lost instruments may be established by secondary evidence at law, and

defendants are entitled to a jury trial upon the alleged lost instruments. See Staiger v. Greb,

App. 3 Dist., 97 So.2d 494 (1957).

142. Because here, there is no dispute that plaintiff seeks to re-establish lost instruments and

to have a “deficiency judgment” against the defendants, the defendants are emtitled to

demand a jury trial.

ANSWER TO COMPLAINT BY BANKRUPT BANK’S FOUNDER ALFRED CAMNER

143. Hereby, “defendants” “respond” to the unlawful and unauthorized “02/22/2011

hearing” before retired “rocket docket” Judge Daniel R. Monaco who is in the pocket of

the bank(s).

144. On 08/12/2010, and after defendants’ Motions to Dismiss had been filed, this wrongful

action to foreclose a mortgage on real property had been disposed.

145. This Court knew that “BankUnited” did not establish its entitlement to foreclose the

mortgage as a matter of law.

146. After said 2010 disposition, the action was never reopened.

147. The exhibits to “BankUnited's” complaint conflicted with its [false] allegations

concerning standing, and said exhibits did not show that “BankUnited” has standing to

foreclose the alleged lost/destroyed mortgage/note or was entitled to the illegal 02/22/2011

hearing and any “trial”.

148. Here, the plain meaning of the exhibits controlled, evidenced lack of standing, and was

the basis for a motion to dismiss. Blue Supply Corp. v. Novos Electro Mech., Inc., 990 So.

23

2d 1157, 1159 (Fla. 3d DCA 2008); Harry Pepper & Assocs., Inc. v. Lasseter, 247 So. 2d

736, 736-37 (Fla. 3d DCA 1971).

149. The “trial” wrongfully “set” by temporary Judge Monaco and “BankUnited’s” motion

for summary judgment and were to be denied based on principles of collateral estoppel and

res judicata. Here on 08/12/2010, the Court had disposed of “BankUnited’s” wrongful

foreclosure action.

150. On 02/22/2011, retired “rocket docket” Judge Monaco had no authority to deny

defendants’ Motion to Dismiss.

DENIALS AND AFFIRMATIVE DEFENSES

151. Defendant counterclaimants JENNIFER FRANKLIN-PRESCOTT, WALTER

PRESCOTT, JOHN DOE, and MARY DOE, file their “response(s)”, affirmative defenses

and claim for attorney’s fees and in support thereof state:

152. Paragraph 1 of purported “plaintiff’s” complaint is denied.

153. Paragraph 2 is denied. Here under paragraph 6, “said [alleged] promissory note and

mortgage have been lost or destroyed and are not in the custody or control of ‘BankUnited’,

and the time and manner of the loss or destruction is unknown.” Furthermore, said alleged

note and/or mortgage could not have possibly been re-established pursuant to Ch. 673,

Florida Statutes (2010), or any other law, and therefore, “BankUnited” had no standing and

right to “foreclose“ and sue the defendants.

154. Here, no “default” has and/or could have possibly occurred, and no contractual obligation

existed.

155. Paragraph 3 is denied. Here, “BankUnited” was never entitled to any action and/or

reestablishment of any note based on the admissible evidence on file.

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156. Paragraph 4 is denied.

157. Paragraph 5 is denied.

158. Paragraph 6 is admitted and “said [purported] promissory note and mortgage have been

lost or destroyed and are not in the custody or control of ‘BankUnited’, and the time and

manner of the loss or destruction is unknown.” Furthermore, said alleged note and/or

mortgage could not have possibly been re-established pursuant to Ch. 673, Florida Statutes

(2010), or any other law, and therefore, “BankUnited” had no standing and right to

“foreclose“ and sue the defendants.

159. Paragraph 7 is denied.

160. Paragraph 8 is denied.

161. Paragraph 9 is denied. “BankUnited” is not any “successor in interest to” “BankUnited,

FSB”.

162. Paragraph 10 is denied. Here, “BankUnited” could not enforce and/or reestablish any note,

and pursuant to paragraph 6, the alleged “promissory note and mortgage have been lost or

destroyed and are not in the custody or control of ‘BankUnited’, and the time and manner

of the loss or destruction is unknown.”

163. Paragraph 11 is denied.

164. Paragraph 12 is denied.

165. Paragraph 13 is denied. Furthermore, said paragraph is grammatically in error.

166. Here, paragraph 14 was vague and ambiguous as there were two “paragraph 14”.

167. Paragraph 14 is denied. None of the defendants owe(s) any fees to “BankUnited” in the

record absence of any note in evidence. Here, “BankUnited” owes fees to the defendants.

25

Here, there had been a disposed wrongful foreclosure action, which was facially frivolous

and insufficient.

168. Paragraph 15 is denied. Here, pursuant to paragraph 6 (Count I), the alleged “promissory

note and mortgage have been lost or destroyed and are not in the custody or control of

‘BankUnited’, and the time and manner of the loss or destruction is unknown.”

169. Paragraph 16 is denied. Here under Paragraph 6, “said [purported] promissory note and

mortgage have been lost or destroyed and are not in the custody or control of ‘BankUnited’,

and the time and manner of the loss or destruction is unknown.” Furthermore, said alleged

note and/or mortgage could not have possibly been re-established pursuant to Ch. 673,

Florida Statutes (2010), or any other law, and therefore, “BankUnited” had no standing and

right to “foreclose“ and sue the defendants.

DISSOLVED LIS PENDENS DUE UNENFORCEABILITY OF LOST INSTRUMENTS

170. Jennifer Franklin-Prescott owns the property at 25 6th Street North, Naples, Florida 34102.

171. Under Rule 1.420(f), Fla. R. Civ. P. (2010), the improper and unauthorized lis pendens

was automatically dissolved upon the disposition of foreclosure on 08/12/2010.

172. Pursuant to § 48.23(2), Fla. Stat. (2010), the notice of lis pendens became invalid on

07/10/2010.

173. Here, the instruments were missing and the lis pendens was unjustified under Florida

Communities Hutchinson Island v. Arabia, 452 So.2d 1131, 1132 (Fla. 4th DCA 1984).

174. Here, the null and void lis pendens placed a non-existent cloud on the title. See Andre

Pirio Assocs. v. Parkmount Properties, Inc., N.V., 453 So.2d 1184, 1186 (Fla. 2d DCA

1984).

26

175. In this disposed action, the purported “plaintiff” frivolously sought to re-establish the

missing note in “COUNT I (Reestablishment of Lost Instruments)” of the complaint, which

was impossible as a matter of law.

176. Franklin-Prescott had filed her answer(s) and motions to dismiss and proven plaintiff’s

lack of standing, which was one of the ultimate affirmative defenses.

177. The record evidence established that plaintiff could not possibly re-establish the note and

that no authentic instruments could possibly be proven under the Evidence Code.

178. Paragraphs 17, 18, and 19 are denied.

179. Purported plaintiff “BankUnited” is not any note owner/holder, had no standing, and could

not possibly declared any amounts due under a lost, destroyed, and/or non-reestablished note.

180. Here, the record did not conclusively establish that “BankUnited” is a holder in due

course of any negotiable instrument. “BankUnited” did not raise any law and/or doctrine

under which “BankUnited” did and/or could have possibly become a note owner and/or

holder in due course.

181. Paragraph 20 is denied.

182. Paragraph 21 is denied.

183. Paragraph 22 is denied as the sentence is incomplete.

184. Paragraph 23 is denied in the record absence of any enforceable instruments.

185. The purported lost mortgage lien was unenforceable due to the deprivation of the

original instrument(s). Here, “BankUnited” was unable to enforce any mortgage lien,

because it never properly obtained the lost/destroyed instruments.

186. “BankUnited” filed the wrongful suit after the May 2009 seizure of defunct

“BankUnited, FSB”.

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187. After bankrupt “BankUnited, FSB” was seized, its troubled founder, Alfred Camner,

Esq., complained of an UNKNOWN loss/destruction of the purported instruments.

188. As founder of defunct “BankUnited, FSB”, Alfred Camner knew and concealed that the

alleged lost/destroyed instruments could not have possibly been transferred to

“BankUnited”.

189. Here, time and manner of the loss were UNKNOWN pursuant to the 07/09/2009

complaint.

190. Here, “BankUnited” was not any assignee and did not hold title in the purported

lost/destroyed instruments.

191. Here, the record had conclusively evidenced the lack of any chain of title.

192. “BankUnited” was not any real party in interest, did not hold legal title to the

destroyed/missing mortgage and note, and was not the proper party to file suit to foreclose

the alleged mortgage.

193. Here, there was no effective assignment from “BankUnited, FSB” to “BankUnited” or any

legal justification why and how “BankUnited” could possibly be entitled to enforce the lost

instruments.

194. The destroyed/lost instruments were unenforceable as a matter of law. See, e.g., section

673.3091, Florida Statutes.

195. Here, retired Monaco and the Court knew that “BankUnited” failed to meet, and could not

possibly have met, the Uniform Commercial Code provisions pertaining to lost and/or

destroyed notes and enforceability of lost/destroyed notes. Therefore, no foreclosure could

possibly occur. See Article 3, U.C.C.; Ch. 673, Florida Statutes (2010).

28

196. The endorsement in blank was unsigned and unauthenticated, creating a genuine issue

of material fact as to whether “BankUnited” was the lawful owner and holder of the

note and/or mortgage. As in BAC Funding Consortium, Inc. ISAOA/ATIMA v. Jean-

Jacques, 28 So. 3d 936 (Fla. 2d DCA 2010), there were no supporting affidavits or

deposition testimony in the record to establish that “BankUnited” validly owns and holds the

falsely alleged note and mortgage, no evidence of an assignment to “BankUnited”, no proof

of purchase of the alleged debt nor any other evidence of an effective transfer. Therefore, the

defendants were entitled to dismissal. Here, no exceptions were invoked.

197. This Court knew of binding precedent and that the Second District had confronted a

similar situation in BAC Funding Consortium, Inc. ISAOA/ATIMA v. Jean-Jacques, 28 So.

3d 936 (Fla. 2d DCA 2010), when the trial court had granted the alleged assignee U.S.

Bank's motion for summary judgment. [That court reversed because, inter alia, "[t]he

incomplete, unsigned, and unauthenticated assignment attached as an exhibit to U.S. Bank's

response to BAC's motion to dismiss did not constitute admissible evidence establishing U.S.

Bank's standing to foreclose the note and mortgage." Id. at 939. Said Appellate Court

in BAC Funding Consortium, properly noted that U.S. Bank was "required to prove that it

validly held the note and mortgage it sought to foreclose." Id.]

198. This Court knew that “BankUnited” cannot foreclose on the note and mortgage, because

“plaintiff” is not in possession of the original note and did not reestablish the alleged

lost/destroyed instruments. See § 673.3091(1), Fla. Stat.; Dasma Invest., LLC v. Realty

Associates Fund III, L.P. 459 F. Supp. 2d 1294, 1302 (S.D. Fla. 2006).

199. Here, this Court knew that “BankUnited” had no standing and/or right to sue and/or

foreclose.

29

200. This Court knew that defendants had demanded indemnification of defendants for

[wrongful] prosecution on the purported destroyed and/or lost instruments.

201. So far, this Court did not require a bond pursuant to Lovingood v. Butler Construction

Co., 131 So. 126, 135 (Fla. 1930).

202. However in this disposed action, the bond was simply mandatory pursuant to Porter

Homes, Inc. v. Soda, 540 So.2d 195, 196 (Fla. 2d DCA 1989)(where a lis pendens is not

founded upon a lawsuit involving a recorded instrument, section 48.23(3) "requires the

posting of a bond."). See Machado v. Foreign Trade, Inc., 537 So.2d 607, 607 n.1 (Fla. 3d

DCA 1988); Munilla v. Espinosa, 533 So.2d 895 (Fla. 3d DCA 1988).

203. The notorious 20th Judicial Circuit has heard up to 1,000 foreclosure cases per day.

Assuming an 8-hour day, this equated to less than 30 seconds per case, which established

organized bias against defendants and homeowners.

204. The law prohibits “rocket dockets” for speed and errors at the expense of justice in favor

of banks and lenders.

30

205. Here, the Docket showed “Judge Hugh D. Hayes” and the lack of any “Reopen Reason”

after the 08/12/2010 disposition:

206. Section 831.01, Fla. Stat., provides:

“Whoever falsely makes, alters, forges or counterfeits a public record, or a certificate, return or attestation of any clerk or register of a court, public register, notary public, town clerk or any public officer, in relation to a matter wherein such certificate, return or attestation may be received as legal proof; or a charter, deed, will, testament, bond, or writing obligatory, letter of attorney, policy of insurance, bill of lading, bill of exchange or promissory note, or an order, acquittance, or discharge for money or other property, or an acceptance of a bill of exchange or promissory note for the payment of money, or any receipt for money, goods or other property, or any passage ticket, pass or other evidence of transportation issued by a common carrier, with intent to injure or defraud any person, shall be guilty of a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.”

NOTICE OF DEFENDANTS’ CHANGE OF ADDRESS

207. Hereby, defendants file their Notice of change of address:

Jennifer Franklin-Prescott, et al., defendants

Care/of Papanui PostShop

7 Main North Road, Papanui, Christchurch, 8053

New Zealand

NATIONAL EMERGENCY AND PRESCOTT’S NOTICE OF UNAVAILABILITY

208. Jennifer Franklin-Prescott, a United Kingdom citizen, has family, friends, and property in

the Pacific. A national emergency was declared after the devastating NZ earthquake.

31

Franklin-Prescott cannot leave because of said emergency and will therefore be unavailable.

Hereby, Franklin-Prescott gives again notice of her unavailability.

AFFIRMATIVE DEFENSES PRIOR TO DISPOSITION

FIRST AFFIRMATIVE DEFENSE: FAILURE TO PRODUCE ORIGINAL NOTE

209. A person seeking enforcement of a lost, destroyed or stolen instrument must first prove

entitlement to enforce the instrument WHEN the loss of possession occurred, or has directly

or indirectly acquired ownership of the instrument from a person who was entitled to enforce

the instrument WHEN loss of possession occurred. Further, he/she must prove the loss of

possession was not the result of a transfer by the person or a lawful seizure; and 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. 673.3091

Fla. Stat. (2010).

210. Here, “defendants” had denied that “BankUnited” has ever had possession of the alleged

note and/or mortgage and/or that “plaintiff” was ever entitled to enforce the instruments the

loss and destruction of which were UNKNOWN. “Plaintiff” could not establish foundation

to show possession of the note WHEN the loss of possession occurred. Plaintiff could not

establish that plaintiff lost possession of the note after it was transferred to the “plaintiff” and

that it could not reasonably obtain possession thereof. Absent such proof in this disposed

action, plaintiff had been required by Florida law to provide the original note and mortgage.

Having failed to provide the original note and mortgage at the time of filing, “plaintiff”

could not sue and/or maintain this disposed action.

32

211. Here, the “plaintiff” could not prove the terms of the instrument and the plaintiff bank’s

right to enforce the alleged instrument. The court may not enter judgment in favor of the

person seeking enforcement unless it finds that the person required to pay the instrument is

adequately protected against loss that might occur by reason of a claim by another person to

enforce the instrument. Fla. Stat. 673.3091(2). In this disposed action, defendants

specifically have been denying all necessary terms of the note are provided in the attached

mortgage/note. Clearly, since the note has been missing, necessary endorsements on the note

are missing; as such, essential terms and conditions precedent were not provided by the

plaintiff who failed to state a cause of action.

UNCLEAN HANDS DEFENSE

212. Prescott had asserted and proven (another affirmative defense) that the plaintiff(s) had

failed to follow Florida law of negotiable instruments and including, e.g., obtaining

necessary signatures, acknowledgments, recordations, assignments, and/or endorsements on

the purported non-authentic promissory note and mortgage deceptively submitted to this

Court as alleged debt evidence. As such, the plaintiff came to this court with unclean hands.

RECUSAL/DISQUALIFICATION OF THE “TRIAL” JUDGE

213. Defendants’ motion to recuse retired Judge D. R. Monaco was legally sufficient,

because the facts alleged demonstrate that the moving party has a well-grounded fear that

defendants will not receive a fair trial at the hands of said judge. Cave v. State, 660 So. 2d

705, 708 (Fla. 1995); Fla. R. Jud. Admin. 2.160.

33

PRESCOTT FEARS FURTHER FRAUD, DEPRIVATIONS & SHAM PROCEEDINGS

214. After said unlawful “02/22/2011 hearing”, Prescott fears that Monaco may further

extend his prima facie bias and again deprive her of due process and fundamental rights to

defend against “BankUnited’s” fraud on the court.

215. Because here no reasonable person, juror or judge could possibly explain the record

errors, contradictions, and arbitrary acts in this disposed case, Franklin-Prescott cannot

possibly trust Judge Monaco, said Circuit, and said “rocket docket” sham proceedings.

WHEREFORE counterclaimants respectfully demand

1. An Order for compensatory and punitive damages in favor of counterclaimant fraud

victims;

2. An Order for compensatory and punitive damages for breach of contract in favor of

counterclaimants;

3. An Order for judgment against “BankUnited” for counterclaimants’ damages and for an

award of attorney’s fees and for all other relief to which counterclaimants prove entitled;

4. An Order dismissing the previously disposed wrongful foreclosure action because

“BankUnited” had no standing and failed to state a cause of action;

5. An Order canceling any non-jury and/or bench trial;

6. An Order declaring rogue “robo” Judge Monaco’s lack of jurisdiction to overturn and/or

remove the 08/12/2010 disposition record after Franklin-Prescott’s 02/18/2011 Notice of

Appeal;

7. An Order properly setting this Motion to Dismiss for hearing so that Franklin-Prescott can

attend without the illegal interference by rogue retired Judge Monaco;

8. Proper processing of this NOTICE OF APPEAL and/or INTERLOCUTORY APPEAL;

34

9. An Order declaring the “trial set” during said unlawful and cancelled “02/22/10 hearing” in

the excused absence of Franklin-Prescott unlawful for lack of due process and because

“BankUnited” had never been entitled to any action and trial for lack of standing and note in

this disposed case;

10. An Order declaring the “correction of the disposition record” unlawful and prejudicial at

Franklin-Prescott’s expense;

11. An Order enjoining retired robo Judge Monaco from any further deliberate deprivations

of Franklin-Prescott’s fundamental Federal and Florida Constitutional rights to own her

property without judicial fraud and fraud on the court;

12. An Order taking judicial notice of said binding precedent (BAC Funding) in support of the

record 08/12/2010 disposition;

13. An Order determining that the invalid lis pendens was not founded upon a duly recorded

authentic instrument therefore requiring a bond to prevent further irreparable harm following

the 08/12/2010 disposition;

14. An Order declaring the purported “plaintiff” in this disposed action without any authority to

sue, foreclose, and/or demand any payment from Jennifer Franklin Prescott;

15. An Order declaring the cancelled “02/22/2011 hearing” unauthorized in this disposed

action;

16. An Order declaring “BankUnited’s” prima facie sham “motion(s)” and “affidavits”

unlawful in this previously disputed and disposed action;

17. An Order declaring the purported note and/or mortgage unenforceable;

35

18. An Order taking judicial notice of the prima facie unenforceability of the unrecorded,

un-assignable, and unpaid mortgage (unpaid mortgage taxes);

19. An Order declaring the purported “plaintiff” to be in violation of Fed.R.Civ.P. 1.510 in this

disposed and previously controverted action;

20. An Order declaring the purported 2009 “lis pendens” invalid on its face and taking judicial

notice of the nullity of the lis pendens and unenforceable mortgage and/or note;

21. An Order declaring said affidavits “hearsay” and lacking any legal and/or factual basis in

the absence of any authentic “note” and/or mortgage;

22. An Order taking judicial notice of the lack of any genuine “note”, “plaintiff’s” proven fraud

on the Court, opposition, opposition evidence, and case law as to this disposed case;

23. An Order prohibiting Counsel and/or Jason M. Tharokh, Esq., who did not file any notice

from appearing in this disposed action.

Respectfully,

/s/Jennifer Franklin-Prescott, BankUnited foreclosure fraud victim

/s/Walter Prescott, foreclosure fraud victim

ATTACHMENTS

CERTIFICATE OF SERVICE

I hereby certify that a true and correct copy of this NOTICE OF APPEAL has been delivered to

“BankUnited”, “Albertelli Law”, P.O. Box 23028, Tampa, FL 33623, USA, the Clerk of Court,

Hon. Hugh D. Hayes, and retired Hon. Daniel R. Monaco, Courthouse, Naples, FL 34112, USA,

on March 02, 2011.

Respectfully,

/s/Jennifer Franklin-Prescott, fraud victim

/s/Walter Prescott, foreclosure fraud victim

36

CC: Hon. Hugh D. Hayes (Disposition Judge), Albertelli Law, Hon. Daniel R. Monaco, Karen (JA), United States District Court, Clerk of Court, The Florida Bar, New York Times, et al.

robin.sidel@wsj.com, dawn.wotapka@dowjones.com, erose@albertellilaw.com, NetNet@cnbc.com, khundley@sptimes.com, mmiddlebrook@ca.cjis20.org, dmclaughlin9@bloomberg.net, crice@ca.cjis20.org, drovella@bloomberg.net, pforeclosures@ca.cjis20.org, hforeclosures@ca.cjis20.org, CollierJACS@ca.cjis20.org, kbailey@ca.cjis.org, lllayden@NAPLESNEWS.COM, dwilliams@ca.cjis.org, tom.lyons@heraldtribune.com, eecamner@clplaw.net, acamner@clplaw.net, dmonaco@ca.cjis20.org, hhayes@ca.cjis20.org, froomkin@huffingtonpost.com, darlene.muszynski@collierclerk.com, christine@desertedgelegal.com, Collierclerk@collierclerk.com, Sue.Barbiretti@collierclerk.com, Jill.Lennon@collierclerk.com, Dwight.Brock@collierclerk.com, Robert.StCyr@collierclerk.com, afivecoat@albertellilaw.com, simone@albertellilaw.com, nreed@albertellilaw.com, tbaron@albertellilaw.com, jsawyer@albertellilaw.com, jalbertelli@albertellilaw.com,

From: bhtjw@aol.comTo: Naplesnano@aol.com; JRBU@aol.com

Subject: Fwd: DISPOSED CASE & FRAUDULENT "HEARING", RETIRED TEMP. JUDGE HON. DANIEL R. MONACODate: Thu, Mar 3, 2011 3:00 pm

-----Original Message-----From: Darlene M. Muszynski <Darlene.Muszynski@collierclerk.com>To: bhtjw@aol.comSent: Mon, Feb 21, 2011 7:18 amSubject: RE: DISPOSED CASE & FRAUDULENT "HEARING", RETIRED TEMP. JUDGE HON. DANIEL R. MONACO

We have received various e mails regarding this case. Please be advised that we cannot accept e filing or fax’s. You may submit original documents for filing to: Collier County Clerk of the Circuit CourtAttn Civil Department3315 Tamiami Trail E Suite #102Naples, FL 34112-5324 Darlene MuszynskiAssistant Director Civil(239) 252-2706darlene.muszynski@collierclerk.com From: bhtjw@aol.com [mailto:bhtjw@aol.com] Sent: Monday, February 21, 2011 12:22 AMTo: khundley@sptimes.com; dmclaughlin9@bloomberg.net; drovella@bloomberg.net; pforeclosures@ca.cjis20.org;hforeclosures@ca.cjis20.org; CollierJACS@ca.cjis20.org; dwilliams@ca.cjis.org; tom.lyons@heraldtribune.com; DanielMonaco - Circuit Judge; Hugh Hayes - Circuit Judge; froomkin@huffingtonpost.com; Darlene M. Muszynski;christine@desertedgelegal.com; Collierclerk; Sue M. Barbiretti; Jill M. Lennon; Dwight E. Brock; Robert D. St. Cyr;afivecoat@albertellilaw.com; simone@albertellilaw.com; nreed@albertellilaw.com; tbaron@albertellilaw.com;jsawyer@albertellilaw.com; jalbertelli@albertellilaw.com; erose@albertellilaw.com; acamner@clplaw.net; eecamner@clplaw.net;BFERNANDEZ@BANKUNITED.COM; marcl@clplaw.net; rick@agstergroup.com; lawrsa@aol.com; karlatoro@aol.com;edahr@aol.com; nicky_ahrens@earthlink.net; TAIDMAN@FordHarrison.com; toyin.aina-hargrett@tampagov.net;tdaitken@trenam.com; stephen.ake@myfloridalegal.com; aalaee@foley.com; dalbritton@albrittonlawyers.com;rtalba@blackswanlegal.com; salbee@fulmerleroy.com; alberdip@aol.com; jalbinson@dkdr.com; Pascolaw@aol.com;malbrech@verizon.net; jswatz@nytimes.com; Jan Metcalfe - JA Judge Hugh HayesSubject: DISPOSED CASE & FRAUDULENT "HEARING", RETIRED TEMP. JUDGE HON. DANIEL R. MONACO

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Style: BANKUNITED vs FRANKLIN-PRESCOTT, JENNIFER

Uniform Case Number: 112009CA0060160001XX Filed: 07/09/2009

Clerks Case Number: 0906016CA

Court Type: CIRCUIT CIVIL Disposition Judge: HAYES, HUGH D

Case Type: MORTGAGE FORECLOSURES Disposed: 08/12/2010

Judge: HAYES, HUGH D Reopen Reason:

Case Status: DISPOSED Reopened:

Next Court Date: 02/22/2011 Reopen Close:

Last Docket Date: 02/17/2011 Appealed:

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2 of 2 pages. Entries per page: 80

Date Text All Entries

09/07/2010 REQUEST FOR JUDICIAL NOTICE

09/07/2010 NOTICE OF AUTOMATIC DISSOLUTION OF LIS PENDENS

09/07/2010 REQUEST FOR JUDICIAL NOTICE

09/14/2010 NOTICE OF APPEAL AMENDED NOTICE OF APPEAL 2D10-4158

09/14/2010 COPY CORRESPONDENCE TO 2ND DCA W/ATTACHMENTS

09/15/2010 NOTICE OF APPEAL AMENDED NOTICE OF APPEAL 2D10-4158

09/15/2010 COPY AMENDED NOTICE OF APPEAL TITLED TO 2ND DCA

09/15/2010 CORRESPONDENCE FROMAPPEAL CLERK TO DCA W/CERTIFIED COPY AMENDED NOTICE OF APPEAL2D10-4158

09/16/2010 CORRESPONDENCE FROMAPPEAL CLERK TO DCA W/CERTIFIED COPY AMENDED NOTICE OF 2ND AMENDEDNOTICE OF APPEAL

09/16/2010 DEMAND FOR FINAL ORDER

10/04/2010 ORDER BY DCATHIS APPEAL DISMISSED BECAUSE APPELLANT FAILED TO COMPLY WITH THISCOURTS ORDER OF 8/31/10 REQUIRING A COPY OF ORDER APPEALED

10/25/2010 ORDER BY DCA THIS APPEAL IS DISMISSED

11/12/2010 NOTICE OF HEARING

11/12/2010 NOTICE OF FILING AFFIDAVIT OF ATTORNEY FEES

11/12/2010 AFFIDAVIT AS TO ATTORNEYS FEES

12/02/2010 NOTICE OF FILING ORIGINAL NOTE & ORIGINAL MORTGAGE

12/03/2010 MOTIONTO CANCEL UNAUTHORIZED HEARING IN DISPOSED ACTION MOTION FORJUDICIAL NOTICE / BY JENNIFER FRANKLIN-PRESCO

12/06/2010 CORRESPONDENCE FROM COUNSEL TO CLERK

12/06/2010 MOTION TO CANCEL HEARING

12/06/2010 OBJECTION TO& MOTION TO COMPEL & QUIET TITLE BY JENNIFER FRANKLIN-PRESCOT

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2/21/2011 Public Inquiry

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12/06/2010 NO APPEARANCE BY THE PARTIES

12/06/2010 MINUTES - HEARING SEE SCHEDULE MINUTES FOR DETAILS

12/07/2010 NOTICE OF CANCELLATION 12/06/10 @ 3:00 MOTION FOR SUMMARY JUDGMENT

12/08/2010 OBJECTION TO HEARING BY JENNIFER FRANKLIN PRESCOTT

12/08/2010 OBJECTION TOSTATUS OF DISPOSITION JUDGE & RECUSAL MOTION BY JENNIFER FRANKLINPRESCOTT

12/17/2010 NOTICE OF FRAUD & LOSS BY JENNIFER FRANKLIN-PRESCOTT

12/17/2010 MOTIONTO CANCEL UNAUTHORIZED HEARING IN DISPOSED ACTION BY JENNIFER FRANKLINPRESCO

12/20/2010 OBJECTION TO(EMERGENCY) TO PURPORTED NOTE IN DISPOSED ACTION & UNNOTICED &UNAUTHORIZED HEARING IN FRAUD ON COURT CASE BASED ON DEFENDANT ET AL

12/22/2010 NOTICE OF FILING ORIGINAL LOAN MODIFICATION AGREEMENT

01/04/2011 OBJECTION TO FRAUD ON THE COURT BY JENNIFER FRANKLIN-PRESCOTT

01/12/2011 NOTICE OF DROPPING PARTY JOHN DOE/JANE DOE

01/12/2011 MOTION FOR SUMMARY JUDGMENT

01/12/2011 AFFIDAVIT AS TO AMOUNTS DUE

01/12/2011 AFFIDAVIT AS TO ATTORNEYS FEES

02/01/2011 COPY(FAX) NOTICE OF OPPOSITION & OPPOSITION EVIDENCE/FRAUD EVIDENCE &UNAVAILABILITY IN DISPOSED ACTION/NOTIFICATION OF COURT & CLERK ET AL

02/07/2011 NOTICEOF FRAUDULENT AFFIDAVITS BY JASON M TAROKH ESQ & OF UNLAWFUL/UNAUTHORIZED ACT BY ALBERTELLI LAW (UNSIGNED)

02/08/2011 NOTICE OF HEARING02/22/11 @10:00A.M., DEFENDANT'S MOTION TO DISMISS/MOTION TO ENJOIN

02/08/2011 AMENDED NOTICE OF HEARING02/14/11 @3:30P.M. AMENDED MOTIONFOR SUMMARY JUDGMENT AND FORATTORNEY FEES AGAINST PEDRO LUIS LICOURT

02/08/2011 AMENDEDMTOIN FOR SUMMARY JUDGMENT AND FOR ATTORNEY FEES AGAINST PEDRO LUISLICOURT

02/09/2011 DEMANDOF FORENSIC REVIEW & AUDIT AND NOTICE OF FRAUDULENT AND/OR INACCURATEACCOUNTING IN DISPOSED ACTION

02/15/2011 NOTICEOF OBJECTION TO ANY HEARING & MAGISTRATE IN DISPOSED CASE AND OF BEINGBINDING PRECEDENT IN SUPPORT OF 8/12/10 DIPOSITION

02/17/2011 AFFIDAVIT& OR DECLARATORY STATEMENT IN DISPOSED ACTION AS TO LACK OF STANDINGOF BANKUNITED & ITS FRAUD ON THE COURT

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2/21/2011 Public Inquiry

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Monday, February 7, 2011

Florida Foreclosure Mill King David Stern Shows Crime Sure Did Pay

The Associated Press has a juicy story on the rise and fall of Florida’s foreclosure mill kingpin David Stern(hat tip Lisa Epstein). It combines sordid detail with an account of how his business as a business wentwildly off the rails.

For those new to this blog, the Law Offices of David Stern was the biggest foreclosure mill in Florida, one ofthe first to be targeted by a state attorney general, and per both reports on the ground as well asrevelations from official and media investigations, one of the worst abusers of court procedures andborrower rights.

Aside from depicting how utterly out of control Stern was as a businessman, the AP story helps explain howthe mortgage business got to be such a horrorshow. Moe Tkacik, a financial writer who has poked aroundthe dark corners of the securitization and muni finance businesses, and I chatted a couple of nights agoabout the foreclosure crisis. One of the questions that was nagging at her was who came up with the idea ofrobosigning?

The article suggests that it was the foreclosure mills in response to servicer pressure on fees. And noticethe stance of the writer in this extract. Most MSM accounts so far have bent over backwards not to be toocritical of banks. By contrast, this article depicts servicers as partners with Stern in what Bill Black would calla criminogenic environment (boldface ours):

The rise and fall of Stern, now 50, provides an inside look at how the foreclosure industryworked in the last decade — and how it fell apart. It also shows how banks, together with theirlaw firms, built a quick-and-dirty foreclosure machine that was designed to take as manyhouses as fast as possible…

Florida authorities characterize the foreclosure process at these law firms as a “virtual morass”of “fake documents” and depicted Stern’s operations as something akin to the TV show “Lost”— only instead of people that went missing, it was paperwork. Stern’s employees churned outbogus mortgage assignments, faked signatures, falsified notarizations and foreclosed onpeople without verifying their identities, the amounts they owed or who owned their loans,according to employee testimony. The attorney general is also looking at whether Sternpaid kickbacks to big banks.…

The foreclosure business is a volume game. Banks typically pay law firms like Stern’s about$1,400 for each successful foreclosure. But the banks can pay a lot less if the firm doesn’tsuccessfully foreclose within a certain time frame, usually around six months….

Like so many in the industry, Stern had a strategy to cope with all the volume and velocity:robo-signing. One employee testified that Stern’s chief lieutenant, a one-time file clerk namedCheryl Samons who rose to become the firm’s chief operating officer, signed as many as 1,000foreclosure affidavits a day without reading a single word. The employee said Samons’ handgot so tired that she told three other employees to forge her signature. Samons also signednumerous mortgage assignments with a notary stamp that didn’t even exist at the time ofsigning. Notary stamps are only valid for four years. The only way Samons could have signedmortgage assignments at the time they were supposedly notarized was if she had beencapable of time travel…

Stern battled to keep the chaos inside his firm a secret. In 2008 and 2009, whenever theFannie Mae auditors were about to touch down in Miami for their routine monitoring, Stern’semployees sometimes toiled through the night, ripping the stickers and client codes off ofFannie files and replacing them with those of a different lender. Then, as an extra precaution,they hauled the disguised files to a remote back room.

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Stern then gave Fannie officials the white-glove treatment, with catered meals andchauffeuring. The incomplete files stayed hidden until the auditors left town.

I’ve omitted a lot of prurient detail (Stern allegedly didn’t merely grope employees but even fake humpedthem) but the business-related part of the account is plenty ugly. Nevertheless, Moe’s question is onlypartially answered. How did robosigning become so widespread across so many law firms spread across thecountry? This suggests there must have been a propagation channel for this “innovation”. Did servicers goso far as to say, “We use XYZ firm in Florida, they sign affidavits on a factory basis. That enables them tomeet the fees we are willing to pay. It’s up to you to make your economics meet prevailing standards.”

Tom Adams, a mortgage securitization expert, has suggested that the significance of miscreant servicerFairbanks has not been recognized. Law professor Kurt Eggert provides a good overview in his 2007article, “Limiting Abuse and Opportunism by Mortgage Servicers.” In 2003, Fairbanks had become thebiggest subprime servicer in the US by acquiring other subprime servicers. Some of the servicers it hadbought were affiliated with originators that had overstated property values and engaged in lax underwriting.That meant a lot of the loans were due to go bad. Fairbanks came under pressure, via litigation,downgrades in servicer ratings, FTC and HUD investigations, due to widespread evidence of seriousservicing abuses. Notice Fairbank’s argument, per Eggert:

In response to the lawsuits and media reports, Fairbanks argued that it was being blamed forthe problems inherent in the portfolios that it had acquired, such as Conti’s. Such portfolios,Fairbanks claimed, presented special problems because they had not previously beenserviced properly and because subprime borrowers present special challenges, such as theirprecarious financial condition and the lack of escrow accounts for taxes and insurance in thesemortgages (Collins 2003a). Furthermore, Fairbanks argued that because many of the loans itacquired were already delinquent, it would naturally receive a greater number of complaints(Mitchell 2003). In May 2003, according to an executive at Fairbanks, about 30 percent of its600,000 home loans were more than two payments behind, and 45,000 of its loans were inforeclosure.

Why is this significant? Adams argues that everyone is missing the causality. Servicing agreements simplydo not pay enough for the servicer to handle a high level of delinquent loans (Adam Levitin has also madethe similar observations). When they wind up with a high enough level of delinquencies, the only way theycan find out of their fee mess is to cut corners to such a degree that it railroads consumers, or engage inother types of abuses to increase fees (we’ve commented repeatedly on how servicers charge junk feesand engage in fee pyramiding that is in violation of their contracts and Federal law, yet goes unchallenged.And these fees are often so large that they can quickly add up to thousands of dollars, well beyond whateven a responsible borrower can pay.

So overly low fees and immutable contracts, perversely, are the breeding ground of criminal behavior. Yetthe officialdom is still remarkably loath to acknowledge the level of abuse at servicers. The tone of the AParticle suggests that it is becoming harder and harder for them to maintain that fiction.

More on this topic(What's this?)The 2011 Foreclosure Flood(Wealth Daily, 1/13/11)U.S. Banks Are Reporting Phantom $1.4T on Interest From Foreclosed Properties: Massive LossesComing(Shocked Investor, 1/13/11)Face to face with Gerald Celente(Investment Postcards from Cape Town, 2/5/11)Read more onForeclosure, Kingat Wikinvest

Topics: Banana republic, Banking industry, Credit markets, Legal, Real estate

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24 Comments:

attempter says:February 7, 2011 at 5:04 am

How did robosigning become so widespread across so many law firms spread across the country? Thissuggests there must have been a propagation channel for this “innovation”. Did servicers go so far as tosay, “We use XYZ firm in Florida, they sign affidavits on a factory basis. That enables them to meet the feeswe are willing to pay. It’s up to you to make your economics meet prevailing standards.”….

In 2003, Fairbanks had become the biggest subprime servicer in the US by acquiring other subprimeservicers. Some of the servicers it had bought were affiliated with originators that had overstated propertyvalues and engaged in lax underwriting. That meant a lot of the loans were due to go bad. Fairbanks cameunder pressure, via litigation, downgrades in servicer ratings, FTC and HUD investigations, due towidespread evidence of serious servicing abuses.

We can see the servicers’ proximate interest in robo-signing. But as the second part of the quotedemonstrates, it was predictable that the bubble would burst and massive numbers of loans would go bad.

It was so predictable, it’s hard to believe it wasn’t predicted, and part of the plan from the start. It’s hard tosee how the vast majority of mortgages (and not just subprimes ones) going back to the late 90s weren’tfraudulently induced.

So that puts robosigning in a broader perspective. They expected huge numbers of loans to go bad oncethe bubble burst. They had fraudulently sold these MBS based on those time bomb loans. Theysystematically failed to convey the notes as per PSA and REMIC requirements. (This is because they weremisrepresenting the quality of the loans in the securities, because they wanted to maintain the ability toassign loans to tranches as they went bad, and probably also because they were selling the same loanmultiple times. And also to evade recording fees and taxes.)

So given the fact that they knew the time would come when they’d be engaging in large numbers offoreclosures with insufficient documentation (since they couldn’t go into court with anyone but the trusteeholding the properly conveyed note, otherwise they’d be admitting the MBS were fraudulent), the answerwas to use lost-note affidavits which would vaguely vouch that the note had been properly conveyed.Hopefully that would be enough.

And since they’d have to produce such massive numbers of these fraudulent affidavits, robo-signingfollowed as the obvious practice.

I’m still trying to figure all this out, but that’s basically the way it looks to me.

Jim A. says:February 7, 2011 at 9:19 am

Even though everybody KNEW that there was a near-zero chance of borrowers making the agreed-upon payments, I’m not sure that those who agreed to service those mortgages anticipated the levelof foreclosures. But like the borrowers, they anticipated that this “30 year” mortgage would last for nomore than 2 years before the borrower refinanced. But like so many things that worked until itstopped working, and when it stopped, it stopped with a vengence. Because with no real brakes onthe system, everything just ran into a concrete wall.

attempter says:February 7, 2011 at 5:05 pm

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They knew it was a bubble which would burst (in addition to its inherent unsustainability, theirown assaults on the real economy guaranteed people wouldn’t be able to keep paying andbuying), and that at least all the subprime loans would go bust, and probably many more.That’s a lot of foreclosures they must’ve anticipated.

Dwight Baker says:February 7, 2011 at 9:07 am

Harvard, Yale, Columbia and other East Coast Blue Blood Universities teach and preach —– the SEE SAWYAW OF THE LAWBY Dwight BakerFebruary 7, 2011Dbaker007@stx.rr.com \

http://www.nakedcapitalism.com/2011/02/florida-foreclosure-mill-king-david-stern-shows-crime-sure-did-pay.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed:+NakedCapitalism+(naked+capitalism)

MY TAKE

Truth once thought to be the same as Justice took a dump long ago. Maybe some places around the globethere is Justice but certainly NOT IN AMERICA. For the schools of higher education teach those mostprivileged how to game then con the system for personal profit.

Now, the truth is out how David Stern gamed then conned the system, as he obliged the big banks in theirsquirrelly deals to push along their needs to exit.

But what NOW —- SO WHAT I say! Another fine example before us of the sad state that we are all in —- fornone of us has the most minuscule form of Justice. For 90 % our lawyers practice the art of the SEE SAWYAW OF THE LAW.

At the time of the Obama inauguration our Justice department was castrated! No Balls to the wallsinvestigations any longer for now there were No more Balls, Bobby Kennedy tried to bring some down andhe received the fatal bullets. So those in DC know how to walk the line, stay in line and behave as told too.

So what will happen with all these things revealed? Probably end up in a Washington Senate InternalInvestigation that will give rise to a quick demise of all the hardcore evidence. For again most of our electedofficials to spend our money wisely are crooked ass Lawyers schooled in the art of practicing the SEE SAWYAW OF THE LAW.

NOW what say you?

MinnItMan says:February 7, 2011 at 9:28 am

In 2003, the machine was just getting perfected. Aside from a very small number of lenders – ConsecoFinancial comes to mind – very few foreclosures ended up as repos, so losses weren’t a big factor in thebusiness. Instead, the foreclosure bailout/rescue industry was making money on the spread between jackedup redemption prices, which essentially converted the ubiquitous prepayment penalties into forsclosure feesand add ons to the redemption price, and the jacked up appraised price for the new buyer. I attended acontinuing legal ed where a FC attorney said as much, saying “let the loan go to sale where the PrePay nolonger applies.” Your client will be better off.”

Many states began regulating foreclosure bailout/rescue deals, and when these laws began taking effect –here August 1995 – this market disappeared, and the repos did become a significant factor.

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This aspect never really ocurred to me, but the prepay penalty and the foreclosure servicing charges wereabout the same magnitude (the servicing charges might have been a little less, thus that attorney’scomment, but they were still a few thousand dollars), and represented a pretty good income stream untilnobody was paying them anymore.

Volume transactional business always gets takers, even when the numbers don’t work. The takers canalways find a way to make them work, at least temporarily.

Historically, this is a major reason why insurance is regulated – the tendency is to charge too little whenthere are no claims, and then be broke when the claims come in. This highlights a key problem reconcilingcompetitive pricing on long term liability with the IBG YBG tendency of volume paper businesses.

ella says:February 7, 2011 at 9:32 am

In the vast majority of cases white collar crime always pays. Even after a prison sentence and a hefty fine,the criminal is always left with a substantial portion of the fruits of the crime (big bucks). Now, at the moblevel we have criminal laws that strip the mobster of the fruits of their crime, provided the state can find thefruits. Time to apply the same law to the white collar criminals and a similar civil claw back as that found inthe federal RICO statute. We can start by redefining fraud and other white collar crime to make it easier toprove. Next, we apply the same to set of laws to Corporate types in what in now known as “control fraud”.Let us have personal responsibility at this level as well. (not holding my breath)

StillReading says:February 7, 2011 at 9:59 am

I have been reading “Naked Capitalism” and other sources, searching for an explanation for the failure ofcommon sense.

The best “unified field” theory describing such failure is presented by William Black.

http://neweconomicperspectives.blogspot.com/

My reading of Black, and others, provides a straight forward explanation.

1) Fraud pays better than honest.2) Fraud occurred.3) Fraud will spread in an endemic fashion. Fraudulent transactions grow to replace honest transactions.4) Fraud must be stopped or else fraud will continue.

At each step of the complicated sequence, fraud is the explanation for the failure of honesty.

The cure for fraud is prosecution.

readerOfTeaLeaves says:February 7, 2011 at 11:15 am

That’s the best that I can figure.And with computerized networks, there is plenty of anonymity and new means for people to commitwhite collar crime.

But all of this requires that the environment become ‘criminogenic’.Sterns is a chilling example.

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KMR says:February 7, 2011 at 10:30 am

Minor but important point of correction: Kurt Eggert’s article was published in 2004, not 2007.

Schofield says:February 7, 2011 at 11:21 am

Is there any update anywhere on the action the Obama administration is taking to prosecute theseForeclosure Fraudsters?

Procopius says:February 7, 2011 at 7:34 pm

@schofeild: The Obama administration is NOT planning to do anything about the fraudsters. Wemust look forward, not back, don’t you know, so that these mistakes are never made again. Also, if heprosecutes the banksters it will make them sad.

MinnItMan says:February 7, 2011 at 12:45 pm

1995 should have been 2005

Monday Static says:February 7, 2011 at 1:06 pm

Stern can’t be the only hood on Fannie Mae’s go-to debt collectors list. Other firms have not only engagedin felonies, but have either equalled or surpassed Stern’s outrageous behavior, and flourish simply for alack of press coverage. To hell with that – it’s time for automatic disbarment, is this country a kleptocraticbanana republic or what? It’s time for massive civil disobedience.

ScottS says:February 7, 2011 at 9:04 pm

Fannie’s retained attorney list:https://www.efanniemae.com/sf/technology/servinvreport/amn/pdf/retainedattorneylist.pdf

I’ll start you off. Florida retained attorney Shapiro & Fishman just complained to the court that theydon’t want to have to swear to the validity of affidavits filed in Florida foreclosures:http://floridaforeclosurefraud.com/2010/03/foreclosure-lawsuits-are-built-on-lies-shapiro-fishman-admits-foreclosure-claims-cannot-be-verified/

F. Beard says:February 7, 2011 at 1:06 pm

Fractional reserve lending in a government enforced monopoly money supply is theft of purchasing powervia temporary money (credit) creation. Period. Some claim it is also fraud but that is a relic of the goldstandard, imo.

Meanwhile, many assume that we can have an honest economy based on that dishonest foundation.

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My question: When?

AR says:February 7, 2011 at 2:21 pm

Is this article really trying to pin the blame for robosigning on David J. Stern? Are we forgetting about the2004 DocX price list, and the fact that robosigners were working at LPS until 2010, when a federalinvestigation induced them to farm out the robosigning to the foreclosure mills, as described by Scott J.Paltrow? http://www.reuters.com/article/idUSTRE6B547N20101206

I commented months ago that the way to the heart of the scam is to turn foreclosure mill attorneys againstLPS. LPS software manages servicer operations, directs the foreclosure mills, and fabricates documents forthe foreclosure mills. I really think this article is meant to divert attention away from LPS onto the already-disgraced DJS.

Yves Smith says:February 7, 2011 at 6:45 pm

First, robosigning is not the same a document fabrication, although they are related phenomena.

Second, you overstate what I said about the article. Please reread the paragrpah in question.

AR says:February 7, 2011 at 8:27 pm

Yves,

You write: “So overly low fees and immutable contracts, perversely, are the breeding ground ofcriminal behavior.” I think the entire housing bubble was criminogenic, starting at least with thecreation of MERS. The intentional destruction, or failure to create and record, documents in atimely fashion was part of the scheme. They wrote the PSAs, knowing there’d be millions ofdefaults and foreclosures. Robosigners would be required to sign the requisite fabricateddocuments. MERS took that into account in its plan. Much of the robosigning was done at LPSuntil the fee-sharing lawsuit, and the public release of the DocX price list. According to Scott J.Paltrow in his December Reuters article: “beginning early in 2010, county recorders’ recordsshow, signing shifted also to law firms under contract with LPS.” It was LPS’ red-yellow-greenpressure on the foreclosure mills, not the servicers’.

I certainly don’t know the deep history, but based solely on this AP article, I wouldn’t assumethat DJS or other foreclosure mills initiated robosigning. MERS‘ plan called for lenderemployees to do the robosigning, to keep the assignments ‘in house’, thus justifying the ruse ofrecording mortgages in MERS’ name. Foreclosure mill employees were never supposed toperform that function, within the MERS rationale. But then neither were LPS employees.

The same banks who were selling phony MBS securities surely must have known that theirservicing arms would have to ‘earn’ their keep via bogus fees. They expected lots of defaults.This was already happening in 2003, according to Kurt Eggert. The mortgages were designedto strip the borrowers’ equity, and the empty MBS and bogus fees were the means towardsstripping investors and pension funds.* Why else sell the same loan multiple times? Try toexplain how one mortgage payment to one servicer winds up being remitted to several MBSeach month. No wonder the PSAs made it impossible for servicers to ask investors’ permissionto modify loans.

We know that banks have been using perverse fees to bilk credit card holders. Why wouldn’tservicers intend to do the same, regardless of the PSAs fixed fees? And if the intent of the

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masterminds was to collect CDS upon massive defaults, why not construct PSAs that wouldincentivize servicer-induced defaults? I just assume that the PSAs were written the way theywere as part of the overall scheme. Making it impossible to modify loans makes as much senseas setting up servicers understaffed and with software that only drives toward default andforeclosure, like a ratchet, with no way to adjust to individual circumstances of each borrower.Yet that’s what they did, which to me implies that they did it on purpose. But then I’ve becomeextremely cynical. I have no professional background in any of this, so I’m not assuming orexpecting anything other than what I’ve read. Perhaps the professionals are too deep in theweeds to perceive the possibility that this was by design?

I know you write about servicer abuse in the hopes that the AGs or Fed or other regulator willdo something about this. I was pushing this in comments at other blogs last fall too. So I don’tmean to harm this effort.

My impression now is that Treasury is temporarily creating the illusion of a recovery bypropping up the economy with bailouts and statistics, while exhorting and enabling the banks touse whatever predatory, parasitic tricks and bogus fees they can devise to ‘earn‘ their wayback to ‘solvency’ on the backs of their customers. It seems to be administration policy to lookthe other way while the banks force as many foreclosures as possible, in order to be paid byGSEs at par for each foreclosure, whether the family was able to pay or not. Since there’s noway to do this legally, robosigning is a feature, not a bug. Florida is the model of a compliantjudiciary for carrying out this scheme.

* It is my belief that the certain knowledge that peak oil spells the end of capitalism, debtcreation, and debt repayment provided the impetus to not only prop up the hollowed-out USeconomy with the housing bubble, but also to ‘cash out’ of the US economy. Dmitry Orlovdescribed it this way in his Nation video released last week: “So what we saw in the SovietUnion was a political dysfunction where basically the communist regime was so endemicallycorrupt and so out to steal as much as they could at the very end that they really didn’t evenbother paying attention to whether they kept the system going, the system was basically onautopilot until it crashed. Something similar is happening here where we have people in allbranches of government, both political parties, really trying to prop up the financial industrywhich has really become completely irrelevant to most people in the United States who don’thave savings and are not credit worthy. They’re basically trying to use up people’s savings anduse up people’s retirement to prop up this set of institutions that only help the very richpeople.” http://www.thenation.com/video/157985/dmitry-orlov-peak-oil-lessons-soviet-union

Yves Smith says:February 8, 2011 at 1:36 am

MERS didn’t write the PSAs, in fact it has nothing to do with origination, no seat at thetable. The standard form PSAs were developed long before the industry went off therails, so you can’t tie the deal design (which was very carefully crafted) with the badpractices that developed over a decade later.

In fact, as a crime, it would have been far more successful if they had changed the PSAsto conform with the new practices they started to implement sometime between 2002 and2004, namely, not transferring the notes to the securitization trust as specified in thePSA. Robosigning is penny-ante and asking for trouble.

AR says:February 8, 2011 at 7:19 am

I’m fully aware that MERS didn’t originate mortgages or write the PSAs. But MERSwas intentionally created (carefully crafted?) as a black box to hide what theyintended to do with the mortgages & notes.

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L. Randall Wray wrote that MERS’ 1999 State-by-State RecommendedForeclosure Procedures Manual directs servicers to retain the notes.* They had touse the same boilerplate PSAs from the past or people would have been alertedahead of time that something was different this time.

“The deals were carefully crafted.” Are you saying they carefully crafted the dealsbut didn’t bother to adjust the PSAs? Maybe this was intentional. If the MERSmanual is to be taken seriously then what you sate: “the bad practices thatdeveloped over a decade later.” is incorrect. Those bad practices were crafted aswell, as far as the MERS manual indicates.

* Anatomy of Mortgage Fraud: MERS’s Smoking Gun, Part Ihttp://www.huffingtonpost.com/l-randall-wray/merss-smoking-gun-part-1-_b_794713.html?view=print

JP Warchild says:February 8, 2011 at 10:38 am

It seems clear that a much greater portion of the fraudulent activity was in NOTfollowing the PSA agreements, rather than anything that was actually in them.

Blurtman says:February 7, 2011 at 2:29 pm

Failed NY Fed Regulator Takes Job With AIG

AIG hired Federal Reserve Bank of New York veteran Brian Peters to help manage risk after the bailed-outinsurer paid down a credit line with the regulator.

Peters is joining as a senior managing director in the enterprise risk management group, according to aJan. 18 memo to staff from Sid Sankaran, chief risk officer. The insurer was rescued by the Fed in 2008 andrepaid the last $21 billion it owed the regulator on Jan. 14. Peters was senior vice president in riskmanagement at the New York Fed, where he helped oversee the 12 “largest and most systemicallyimportant financial institutions and industry utilities,” according to the memo.

http://www.bloomberg.com/news/2011-02-04/aig-hires-new-york-fed-s-brian-peters-to-risk-management-after-paying-loan.html

“Peters’ risk management talents contributed to the meltdown of Wall Street, rampant fraud, and the TARPbailouts. Based upon that track record, Peters is our man.” said an AIG spokesperson.

PJ says:February 7, 2011 at 7:05 pm

What”s wrong with this statement below…

“Stern battled to keep the chaos inside his firm a secret. In 2008 and 2009, whenever the Fannie Maeauditors were about to touch down in Miami for their routine monitoring, Stern’s employees sometimes toiledthrough the night, ripping the stickers and client codes off of Fannie files and replacing them with those of adifferent lender. Then, as an extra precaution, they hauled the disguised files to a remote back room.

Stern then gave Fannie officials the white-glove treatment, with catered meals and chauffeuring. Theincomplete files stayed hidden until the auditors left town.”

What’s wrong, they all including Stern were on the taxpayers dime… no doubt Stern, Fannie Mae “attorney

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of the year” was able to bill back his largess showdered on Fannie Mae auditors, while lining a few pockets,with a good ole wink, wink, nod, nod!

Indite the auditors on the taxpayers salary! Short, sweet and simple!

Francois T says:February 7, 2011 at 9:47 pm

“Yet the officialdom is still remarkably loath to acknowledge the level of abuse at servicers.”

You mean “predictably loath” I presume. Officialdumb has a lot to answer for in this unbelievable mess, andit is the very last thing they want to do. So, extend and pretend, obfuscate, spin and more spin is the gameplan of Geithner & Compadres.

As for Obama, he has an “agenda” to fulfill, and mere distractions like the economy (most especially jobcreation) just cannot be allowed to be an impediment toward his goal.

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