Sunday, September 11, 2011

Another Utah State Court Foreclosure Case Gets Booted Over To Federal Court

In St. George, Utah, KCSG-TV reports:

  • ReconTrust Company, the foreclosure arm of Bank of America [], accused of illegal foreclosures against Utah homeowners, moved a state court eviction case to federal court Friday claiming exemption to State law. (Case 11-00801)

  • Utah homeowner, Alexis K. De Azevedo II, represented by St. George attorney John Christian Barlow, said in the counter claim and complaint that the Bank of America through ReconTrust Company knowingly conducted a non-judicial foreclosure sale of the property in Washington, Utah, and recorded a Trust Deed in favor of the Federal National Mortgage Association (Fannie Mae) adverse to De Azevedo.

  • The complaint asserts that ReconTrust knew the Trustee's Sale was fraudulent since it's neither a member of the Utah Bar Association or a title insurance company required by Utah law.

  • Fannie Mae is attempting to evict De Azevedo from a home in which they have no interest because of the bogus Trustee Sale conducted by ReconTrust, according to the counter claim.

  • The defendant (De Azevedo) seeks injunctive relief enjoining Fannie Mae from eviction pending a resolution of ownership issue. The counter claim asks for actual, special and statutory damages to be determined by trial.


  • Meanwhile, the Utah Attorney is said to be negotiating a settlement with the Bank of America for its illegal foreclosure activity against Utah homeowners as a result of a May 19, 2011 letter from the Attorney General) in which the bank is accused of using ReconTrust Company, in violation of Utah law as set forth in Utah Code Sections 57-1-21 and 57-1-23, which outlines the requirements for lawful non-judicial foreclosures.

  • The attorney general cited legal precedent for the position in a recent 10th Circuit case, Shurtleff v. Kleinsmith in which Utah Code Sections 51-1-21 and 57-1-12 were found to be constitutional.(1)

  • Shurtleff said, that ReconTrust is in violation of the National Bank Act, which does not allow national banks to operate in contravention of State and local law. Shurtleff said that ReconTrust's exercise of fiduciary powers in the State of Utah is not only a violation of State law, but also applicable federal law.

For more, see St. George Homeowner Eviction Case Moved to Federal Court.

(1) Kleinsmith v. Shurtleff, 571 F. 3d 1033 (10th. Cir. 2009).

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