Friday, 04 February 2011 11:05

Humpty Dumpty sat on a wall,
Humpty Dumpty had a great fall;
Threescore men and threescore more,
Couldn’t place Humpty Dumpty as he was before.

Kansas Supreme Court ruling in Landmark National Bank v. Kesler , 2009 LEXIS 834, the court held that a nominee company called MERS has no right or standing to bring an action for foreclosure.  Nobody has standing to foreclose.  There are two sides to any contract.  When both sides default, the contract is unenforceable.

The bank defaulted when it abandoned its trust responsibilities by settling the promissory note through changing the debt to a stock without disclosure to the debtor.  The debt so treated cannot be enforced unless the debtor is conned into allowing the “color of law” to proceed.

Quotes from the case:

The real parties in interest concealed behind MERS have been made so faceless, however, that there is now no party with standing to foreclose. The Kansas Supreme Court stated that MERS’ relationship “is more akin to that of a straw man than to a party possessing all the rights given a buyer.” The court opined:

“By statute, assignment of the mortgage carries with it the assignment of the debt. . . . Indeed, in the event that a mortgage loan somehow separates interests of the note and the deed of trust, with the deed of trust lying with some independent entity, the mortgage may become unenforceable. The practical effect of splitting the deed of trust from the promissory note is to make it impossible for the holder of the note to foreclose, unless the holder of the deed of trust is the agent of the holder of the note. Without the agency relationship, the person holding only the note lacks the power to foreclose in the event of default. The person holding only the deed of trust will never experience default because only the holder of the note is entitled to payment of the underlying obligation. The mortgage loan becomes ineffectual when the note holder did not also hold the deed of trust.” [Citations omitted; emphasis added.]

“The sole goal of the [bailout schemes] is to prevent owners of mortgage-backed securities, many of them foreigners, from suing U.S. banks and forcing them to buy back worthless mortgage securities at face value – right now almost 10 times their market worth. The ticking time bomb in the U.S. banking system is not resetting subprime mortgage rates. The real problem is the contractual ability of investors in mortgage bonds to require banks to buy back the loans at face value if there was fraud in the origination process.

“. . . The catastrophic consequences of bond investors forcing originators to buy back loans at face value are beyond the current media discussion. The loans at issue dwarf the capital available at the largest U.S. banks combined, and investor lawsuits would raise stunning liability sufficient to cause even the largest U.S. banks to fail, resulting in massive taxpayer-funded bailouts of Fannie and Freddie, and even FDIC . . . .

“What would be prudent and logical is for the banks that sold this toxic waste to buy it back and for a lot of people to go to prison. If they knew about the fraud, they should have to buy the bonds back.”

Humpty Dumpty cannot not be made whole, again.  A Bail-Out is the application of make-up on the face of a corpse.  Two million foreclosures this year will expose the blood dropping from the hands of the three branches of government.  It must be set right.  “Be sure your sins will find you out.”