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"By its express terms," said the Court, the Florida Deceptive and Unfair Trade Practices Act "'does not apply to ... [b]anks and loan associations regulated by federal agencies.'" Wilson v. Everbank, N.A., 77 F. Supp. 3d 1202, (S.D. Fla. 2015), quotingFla. Stat. Section 501.212(4)(c). The Court accordingly granted a federally regulated savings and loan association's motion to dismiss a FDUTPA claim with prejudice in that lender force-placed insurance practices case.
However, the Court entertained a cornucopia of claims allegedly arising under Florida, New York, or Illinois law, some of which it left standing, including claims based on the Truth-in-Lending Act, and alleged breaches of contract and of the implied covenant of good faith and fair dealing.
In a decision on August 10, 2015, the California Supreme Court answered the following question of great public importance, tweaked here with a question mark at the end of the quotation:
Who is "unjustly" enriched if independent counsel representing the insured, but compensated by the insurer, are allowed to retain payments that were unreasonable and unnecessary for the insureds' defense against any claim?
The high Court's answer to its own question was that the lawyers are the ones who are unjustly enriched in such a case. The Court was careful to point out that it was assuming "unreasonable and unnecessary" fees for the sake of argument, so to speak.
Further, the California Supreme Court emphasized the unique posture of the case before it. The trial court entered an order requiring the lawyers to bill "reasonable and necessary" fees in their defense of insureds in their role as Cumis or conflict counsel, and allowing the carrier to sue the lawyers "in a subsequent reimbursement action" if the lawyers' fees were unreasonable and unnecessary. The California Supreme Court accepted this ruling as a "given" and limited themselves to addressing the question whether the carrier may seek reimbursement directly from the lawyers as distinct from, say, the insured. Hartford Cas. Ins. Co. v. J.R. Marketing, L.L.C., ___ Cal. ___ ___, ___ P.3d ___, 190 Cal. Rptr. 3d 599, 2015 WL 4716917, *6 (2015).
To say again, the California high Court held that the carrier could sue the lawyers in this case. Future cases may present different trial court orders and differing circumstances. Some of those cases will arise in California and some will not. Until then, it is fair to say that J.R. Marketing is unique.
However, markets have not exactly "rebounded". The market looks very different today. Hedge funds and other investors are the ones who are buying houses and renting them to people. Based on past experience, many investors will find many ways for their investments to provide them with returns, particularly since the investors will not be the ones dwellling in the houses.
This week, Ms. Gretchen Morgenson comments in her "Fair Game" column in the New York Times that "bits of conventional wisdom … are being questioned." One of these bits is the notion that China's economy will always be strong. Another is the valuation of stock at companies that report losses year after year: Perhaps the stock of companies is overvalued when the companies report nothing but losses in every report. Gretchen Morgenson, "Fair Game / Doubts Start to Chip Away at Mind-Set of Markets" p. 1, col. 1 (New York Times Nat'l ed., "SundayBusiness" Section, August 16, 2015). http://nyti.ms/1LcnVTX
"Bits of conventional wisdom" are if anything overplayed by many investors. The use of leverage to buy stocks is at a high, perhaps at a peak. Money borrowed to buy stocks is "nervous money." http://nyti.ms/1LcnVTX
Just two weeks ago, Ms. Morgenson commented on the Home Affordable Modification Program or "HAMP." The Obama Administration's answer to the problem of underwater homeowners and their desperate need for loan modifications is in the title of her column: "Slack Lifeline for Drowning Homeowners." http://nyti.ms/1WwMkd7
I have read and heard innumerable reports that Fox broadcast the most-watched program in human history. The source of these reports? Fox. The subject of the program? The 17 current GOP candidates for President of the United States.
Really. We are being told that the people nobody wants to hear, let alone watch for hours on TV, drew more attention than the birth of the Christ Child.
I have also read reports criticizing Donald Trump for broadcasting his apparently very high opinion of himself.
Really. And sometimes in the same sentence I hear the "news" that the most-watched program in human history, as reported by the company that broadcast the program, "unfortunately" included a person whose source for the tales of his accomplishments is himself.
What was that word Jon Stewart used to use on his program, the word that describes his sendoff: "If you smell something, say something."
There are two other words that fit the situation, too: Bad faith. It comes in many guises, many forms, sometimes in newspapers, sometimes in claims and Courts, and sometimes on TV.
“We are constantly seeing problems with the way servicers are treating homeowners and not following the rules. I don’t understand why there hasn’t been a stronger policing from Treasury on servicers.”
To keep money flowing through as great a number of hands as possible, and to keep homeowners in their homes, loan modifications – “deals that reduce the costs of mortgages” -- became a popular potential solution to a large part of the Great Recession, which was caused in large part by practices involved in mortgage lending. Loan modifications thus became central to the Obama Administration’s Home Affordable Modification Program or “HAMP,” which was supposed to affect Four Million homeowners and the lenders and servicers that deal with their mortgages.
In an investigative report issued last week, the Office of the Special Inspector General of the Troubled Asset Relief Program (“SIGTARP”) found that banks participating in HAMP rejected 72% of the applications for loan modifications. After some 6 years, the banks have agreed to loan modifications for 887,001 mortgagors-borrowers, not 4,000,000.
SIGTARP reported two big reasons for these results: HAMP is entirely voluntary for banks, and the banks which do participate are “on their own,” without any supervision or accountability.
Lawyers who represent borrowers who have alleged that their loan modification applications were wrongly denied, add a third reason, at least equally significant to the two reasons reported by the Special Inspector General:
Delaying a borrower’s loan modification request can be profitable for a bank; extra time for the bank means more interest and fees can be charged to the borrower, increasing the amount owed on the mortgage.
Instead of affordable modifications, banks are delivering more predatory practices, enabled instead of policed by the Federal Government. The business model of robbing the poor to give to the rich is very much alive.