Motion To Object To Foreclosure Sale

http://rcxloan.com/Motion_to_Object_to_Sale.htm

“A good name is more desirable than great riches; to be esteemed is better than silver or gold.” - Proverb 22:1

Praises & Thanks be unto The Lord My God for the wisdom, knowledge and understanding on legal matter because I received countless feedbacks from folks facing foreclosure and bankruptcy around the United States as follows:

Comments: "I have been inundated with TILA questions. So I went out hunting to see if anyone had already written about it in terms that a lay person might be able to understand. What I found is shown below. I believe it to be generally correct and the citations are good citations of law. See this site for the entire write-up. It should give most lay people an idea on how to handle this and it will be valuable to your lawyer if he/she is not totally familiar with the TILA context at the following link:" http://rcxloan.com/Civil_Action_BK_Motion_14.htm. Statement made by Attorney at Law, Neil F. Garfield, M.B.A., J.D.

A STORY TO THINK ABOUT
“Once upon a time in the Ancient Roman Empire, 27 BC, there were two men living in Jerusalem. One was named Ameriquest-New Century-Chase Home Finance-Deutsche Bank National Trust, a rich man whose land was worth close to $700 billion in today‘s money; the other, Mr. Augustin, a farmer whose land was worth $300,000. One day, Ameriquest-New Century-Chase Home Finance-Deutsche Bank National Trust asked Mr. Augustin to give him his land, that he may have it for a vegetable garden. But, Mr. Augustin said to Ameriquest-New Century-Chase Home Finance-Deutsche Bank National Trust, “The Lord forbid me that I should give to you the inheritance of my fathers”.

When Jezebel, the wife of Ameriquest-New Century-Chase Home Finance-Deutsche Bank National Trust, heard what Mr. Augustin said to him. She said, don‘t worry love, I will take care of the matter? Arise, eat bread, and let your heart be joyful; I will give you Mr. Augustin‘s land. So, Jezebel wrote letters in Ameriquest-New Century-Chase Home Finance-Deutsche Bank National Trust’s name and seal them with his seal and sent letters to the elders and to the nobles who were living in Jerusalem. Now she wrote in the letters, saying, proclaim a ‘relief of stay trial’ in the absence of Mr. Augustin. Then, issued a decree that Mr. Augustin’s land is now Ameriquest-New Century-Chase Home Finance-Deutsche Bank National Trust.

So the men of Jerusalem, the elders and the nobles did as Jezebel had sent word to them, just as it was written in the letters which she had sent them. Ameriquest-New Century-Chase Home Finance-Deutsche Bank National Trust take possession of Mr. Augustin’s land which he had refused to give. The sad part is that Mr. Augustin was forced off his land illegally and fraudulently. Mr. Augustin left with nothing and forced to seek refuge from Jerusalem to a land called ‘Fairfax, Virginia’ to start from scratch. Whereas, Ameriquest-New Century-Chase Home Finance-Deutsche Bank National Trust became more wealthy with the unwarranted possession of his and hold more than $700 billion of assets as a result.

Questions? Why was Mr. Augustin absent in the relief of stay trial? Why did the elders and the nobles just do as Jezebel asked them? Let us all fast forward in 2008, what do you think the elders and the nobles should have done differently?”

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UNITED STATES BANKRUPTCY COURTFOR THE DISTRICT OF MASSACHUSETTS

Pierre Richard Augustin, PRO SE )
Debtor ) C.A. No. 05-46957 (JBR)
)
) Motion Objecting to Propose Sale
v. ) Of Debtor’s Property on May 16, 2007
) pursuant Rule 6004 (b)
)
DANVERSBANK, ET AL., )
Defendants. )

Motion Objecting To Propose Sale Of Real Property Pursuant Rule 6004 (b) Based on
Affirmative Defenses Due To The Violations Of The Truth-In-Lending Act (TILA),
Real Estate Settlement And Procedure Act (RESPA) And Mortgage Fraud

Your Honor, “parties appearing pro se are allowed greater latitude with respect to reasonableness of their legal theories (Patterson V. Aiker, 111 F.R.D. 354, 358 [N.D. GA 1986])”. To the extent that Debtor did not confine strictly to the rules, specifically relating to formatting, Debtor respectfully apologizes to this court. In consequence, the court is supposed to judge the case based on its merits even if procedural errors are made. Therefore, the court must give a Pro Se Debtor, “every favorable inference arising from his pro se status” (Hall v. Dworkin, 829 F. Supp. 1403, 1409 (ND NY 1993).

Jurisdiction
Jurisdiction of this matter is at the Bankruptcy Court since The Federal Reserve Act that allows banking is not a state issue, but a Federal issue. Other defenses to the transaction may become evident during the course of litigation. Debtor reserves his right to raise them at that time. Much of the relevant information is solely in the possession of the Creditors. Thus, Debtor is raising only those defenses based upon facts that are clear at this time (see motion on evidence as well).

Parties
Chase Home Finance and Deuthsche Bank National Trust are not Real Party in Interest and Creditors have No Standing to pursue foreclosure action because, once TILA notice of rescission is given, the lien or security interest in Debtor’s property becomes void ab initio, even if a court has not yet ruled on the validity of the Debtor’s rescission (Willis v. Friedman, Clearinghouse No. 54,564 (Md. Ct. Spec. App. May 2, 2002)).

TILA As Affirmative Defense To Foreclosure
Specific TILA violations do not necessarily have to be alleged with particularity (Brown v. Mortgagestar, 194 F. Supp. 2d 473 (S.D. W. Va. 2002) (notice pleading is all that is required in TILA case); Herrara v. North & Kimball Group, Inc., 2002 WL 253019 (N.D. Ill. Feb.. 20, 2002) (notice pleading sufficient; response to motion to dismiss can supplement complaint by alleging facts re specific documents assigned); Staley v. Americorp. Credit Corp., 164 F. Supp. 2d 578 (D. Md. 2001) (Debtor need not specify specific statute or regulations that entitle him to relief; court will examine this ‘Motion to Object to Propose Sale’for relief on any possible legal theory); Hill v. GFC Loan Co., 2000 U.S. Dist. Lexis 4345 (N.D. Ill. Feb. 15, 2000). Debtor’s Motion need not plead an error exceeded the applicable tolerance, since this is an affirmative defense (15USC 1635(i)), (Inge v. Rock Fin. Corp., 281 F.3d 613 (6th cir. 2002)).

Factual Background
Debtor filed a copy of the notice of rescission letter in the bankruptcy court notifying the attorneys representing DanversBank, Ameriquest Mortgage, Commonwealth Land Title Insurance Company, New Century Mortgage and Chase Home Finance as well as having certified receipt return of proof of delivery to the Lawyers including are proof of notification according to the Official Staff Commentary, 226.2(a)(22)-2 as authorizing service on attorney. The Truth-in-Lending law empower Debtor to exercise his right in writing by notifying the named Creditors of his cancellation by mail to rescind the mortgage loan transactions per (Reg. Z §§ 226.15(a)(2), 226.23(a)(2), Official Staff Commentary § 226.23(a)(2)-1) and 15 U.S.C. § 1635(b).

The filing of Bankruptcy tolls or extends the rescission time since Debtor had filed for bankruptcy on September 26, 2005 and obtained a discharge on September 26, 2006. Also, the principle of equitable tolling does apply to TILA 3 years period of rescission since despite due diligence, Debtor could not have reasonably discovered the concealed fact of TILA violations in-depth and explicitly until September 17, 2006 at about 5 a.m. in reading the Truth-in-Lending book by the National Consumer Law Center.

As an unsophisticated borrower at the time of the loan transactions, Debtor did not have an in-depth fundamental understanding of the basic terms and cost of a typical mortgage loan transaction. Debtor relied on the good faith and fiduciary responsibilities of the mortgage companies, the brokers and the lawyers not to take advantage of his naivety. Also Debtor’s substantial equity in his home made him a prime target for predatory mortgage lenders and brokers.

Debtor has suffered economic and emotional damages as a result of the Creditors’ conduct as described herein. Debtor objects to the sale of May 16, 2007 and seeking damages for refusing to honor his valid rescission of the transaction and to enforce his rescission of a mortgage held by the Creditors. The mortgage that is the subject of this foreclosure action was taken in connection with the transaction that Debtor/Debtor has elected to rescind. Since the mortgage is now void, this illegal and fraudulent foreclosures action should be stopped.

Equitable Tolling
The equitable tolling principles are to be read into every federal statute of limitations unless Congress expressly provides to the contrary in clear and ambiguous language, (See Rotella v. Wood, 528 U.S. 549, 560-61, 120 S. Ct. 1075, 145 L. Ed. 2d 1047 (2000)). Since TILA does not evidence a contrary Congressional intent, its statute of limitations must be read to be subject to equitable tolling, particularly since the act is to be construed liberally in favor of Debtor.

Security Interest is Void
The statute and regulation specify that the security interest, promissory note or lien arising by operation of law on the property becomes automatically void. (15 U.S.C. § 1635(b); Reg. Z §§ 226.15(d)(1), 226.23(d)(1). As noted by the Official Staff Commentary, the creditor’s interest in the property is “automatically negated regardless of its status and whether or not it was recorded or perfected.” (Official Staff Commentary §§ 226.15(d)(1)-1, 226.23(d)(1)-1.).


What if Creditors Claimed that Debtor does not meet Legal Requirement for TILA Rescission?
If any of the Creditors disputes the Debtor’s right to rescind, they should have filed a declaratory judgment action in Court within twenty days after receiving the rescission notice on September 21, 2006, before the deadline of October 10, 2006 to return the Debtor’s money or property and record the termination of its security interest on October 10, 2006 according to 15 USC 1635(b).

The security interest is void and of no legal effect irrespective of whether the creditor makes any affirmative response to the notice. Also, strict construction of Regulation Z would dictate that the voiding be considered absolute and not subject to judicial modification. This requires DanversBank, Ameriquest Mortgage, Commonwealth Land Title Insurance Company, New Century Mortgage and Chase Home Finance to submit canceling documents creating the security interest and filing release or termination statements in the public record. (Official Staff Commentary §§ 226.15(d)(2)-3, 226.23(d)(2)-3.)

Extended Right of Rescission
The statute and Regulation Z make it clear that, if Debtor has the extended right and chooses to exercise it, the security interest and obligation to pay charges are automatically voided. (Cf. Semar v. Platte Valley Fed. Sav. & Loan Ass’n, 791 F.2d 699, 704-05 (9th Cir. 1986) (courts do not have equitable discretion to alter substantive provisions of TILA, so cases on equitable modification are irrelevant). The statute, section 1635(b) states: “When an obligor exercises his right to cancel…, any security interest given by the obligor… becomes void upon such rescission”. Also, it is clear from the statutory language that the court’s modification authority extends only to the procedures specified by section 1625(b). Also, relief from the automatic stay does not void the legal influences of TILA rescission notice as a defense to foreclosure action.

The voiding of the security interest is not a procedure, in the sense of a step to be followed or an action to be taken. The statute makes no distinction between the rights to rescind in three day or extended in three years for federal and four years under Massachusetts TILA, as neither cases nor statute give courts equitable discretion to alter TILA’s substantive provisions. Since the rescission process was intended to be self-enforcing, failure to comply with the rescission obligations subjects DanversBank, Ameriquest Mortgage, Commonwealth Land Title Insurance Company, New Century Mortgage and Chase Home Finance to liability for damages (Fairbanks Capital Corp. v. Jenkins, 225 F. Supp. 2d 910, 914 (N.D. ILL. 2002), (Brown v. Mortgagestar, 194 F. Supp. 2d 473 (S.D. W. Va. 2002) (refusing to dismiss TILA against servicer-assignee who was “functional holder” of the loan and also refused to reveal the identity of the actual holder or assignee of the loan).

Thus, Debtor arguments are based on the following Rule of Law and others as deemed appropriate:

TILA Rescission Notice, “Once notice of rescission is given, the lien or security interest in Debtor’s property becomes void ab initio”, (Reg. Z §§ 226.15(d)(2), 226.23(d)(2), 226.15(a)(2), 226.23(a)(2), Official Staff Commentary § 226.23(a)(2)-1), 226.15(d)(1)-1), 226.23(d)(1)-1) and 15 U.S.C. § 1635(b), (Willis v. Friedman, Clearinghouse No. 54,564 (Md. Ct. Spec. App. May 2, 2002), 69 Fed. Reg. 16796, 16771-72 (Mar. 31, 2004).

Undeniable Evidence of Mortgage Fraud and Illegal Foreclosure Action
New Century Mortgage, Chase Home Finance and Deuthsche Bank National Trust have failed to accept the TILA rescission notice by usurping the rule of law. Therefore, the security interest was automatically voided on September 21, 2006 upon reception of TILA notice of rescission. In addition, their illegal action of foreclosure proceedings and fraudulent transfer of Debtor’s property deed have nullified the mortgage and their foreclosure action is illegal, immoral and fraudulent (Albano v. Norwest Fin. Haw., Inc., 244 F.3d 1061 (9th cir. 2001) (TIL Rescission Claim).

Violation of the Truth-In-Lending Act (TILA) notice of rescission sent to Creditors on September 21, 2006 which automatically void the security interest in the Debtor’s property.

Violation of Statute of Limitation
If any of the Creditors disputes the Debtor’s right to rescind, they should have filed a declaratory judgment action within twenty days after receiving the rescission notice, before the deadline of October 10, 2006 to return the Debtor’s money or property and record the termination of its security interest according to 15 USC 1635(b).

On November 15, 2006, all Creditors were on notice that they were in default for TILA violations (see docket # 80, Case #: 06-10368).

Fraud committed upon Debtor at the registry of deed in Lowell, Massachusetts filed on January 29, 2007 by New Century Mortgage, Chase Home Finance and Deuthsche Bank National Trust in transferring mortgage and note illegally and fraudulently as described in 15USC 1635(i). The transfer of the Debtor’s mortgage is a transfer of the security interest in land that none of the Creditors can claimed since the security interest in the Debtor’s property is void, which is generally governed by the law of conveyances and the real property recording system. The transfer of the promissory note is governed by the law of contracts and by the Uniform Commercial Code (UCC). (Harmony Hmes v. United States ex rel. Small Bus. Admin., 936 F. Supp. 907 (M.D. Fla. 1996)).

Violation of the statute of limitations and fraudulent assignment of the mortgage. Without a security interest in the Debtor’s property, New Century Mortgage, Chase Home Finance, Deuthsche Bank National Trust and any other parties do not have the authority to foreclose. (McKay v. Capital Resources, 940 S. W.ed 869 (Ark. 1997); Fleet v. Nazareth, 75 Conn. App. 791, 818 A.2d 69 (2003); State Street Bank and Trust Co. v. Lord, 851 So. 2d 790, 51 U.C.C. Rep. Serv. 2d 191 (Fla. Dist. Ct. App. 2003); Mitchell bank v. Schanke, 676 N.W.2d 849 (Wis. 2004)).

Violation of the Federal Rule of Civil Procedure 17(a), (East Coast Properties v. Galang, 308 A.D.2d 431, 765 N.Y.S.2d 46 (N.Y. App. Div. 2003). None of the Creditors are Real Party in Interest since the TILA notice of rescission automatically voids the security interest. Upon rescission, none of the Creditors have standing to bring a foreclosure action (First Union Nat’l Bank v. Hufford, 146 Ohio App. 3d 673, 767 N.E.2d 1206 (Ohio Ct. App. 2001); Washington Mut. Bank v. Green, 156 Ohio App. 3d 461, 806 N.E.2d 604 (2004); (a real party in interest is one who is directly benefited or injured by the outcome, however, there is not a security interest in the Debtor’s property since the security interest is void automatically per TILA notice of rescission sent to Ameriquest Mortgage, New Century Mortgage, Commonwealth, DanversBank, Chase Home Finance & Deuthsche Bank National Trust on September 21, 2006).

Thus, Debtor hereby submits this Memo because the security interest is void and a foreclosure sale is improper (15USC 1635(i)) after the Debtor has sent a rescission notice on September 21, 2006, even if a court has not yet ruled on the validity of the Debtor’s rescission (Willis v. Friedman, Clearinghouse No. 54,564 (Md. Ct. Spec. App. May 2, 2002)). But, the timeframe for any of the Creditors to object or to challenge the TILA notice of rescission has already expired on October 10, 2006 according to TILA strict liability rule.

According to Regulation Z, 226.3(b) – Credit over $25,000 (like DanversBank note assigned to Commonwealth) Secured by Plaintiff’s Real Property or Dwelling – Any extension of credit secured either by real property or by personal property used or expected to be used as the consumer’s principal dwelling, even if the transaction exceeds $25,000, it is subject to TILA (emphasis added) and if it is secured by the consumer’s house or his principal dwelling (Official Staff Commentary, 226.3(b)-1; Cordova v. Banco Bilbao Vizcaya, 73 F. Supp. 2d 133 (D. P.R. 1999) (of Borrower’s six loans, all over $25,000, TILA applied only to one secured by real property) (See Reg. Z, 226.2(a)(19) and Official Staff Commentary, 226.2(a)(19) for definition of “dwelling” and official staff commentary, 226.2(a)(19)-1, 226.2(a)(24)-3, 226.15(a)(1)-5 and 226.23(a)(1)-3 for discussion of ‘principal dwelling’.

In addition, the Debtor seeks statutory damages, costs, and attorney's fees from Deutsche, Commonwealth and Ameriquest’s failure to honor his valid rescission notice in conformity with the requirements of TILA. The Debtor also asserts claims pursuant to M.G.L. c. 140D, the state truth in lending act, which contains corollary provisions identical to the federal TILA, M.G.L. c.183, §63, Chapter 93A, UDAP (Unfair and Deceptive practices) and the state common law.

Misrepresentation
The loan was unconscionable. That is, the inequality of the bargain is so manifest as to the payment shock factor make the terms oppressive and that no honest and fair person would have accepted if all the facts were presented and disclosed. Also, the creditors violated a Relationship of Trust with the Debtor that developed in the lending process. Lastly, there was Fraud, irregularity, misconduct, unfairness or misrepresentation by the creditors in the making of the loan (See the Motion on Evidences).

Violation of M.G.L. c. 183, §63
Massachusetts' points and fees statute, c.183, §63, prohibits lenders from charging more than two points on any consumer mortgage loan.

Truth in Lending Act Violations
In violation of 12 C.F.R. § 226.23(b), Creditors did not, at the consummation of the loan transaction, give the Debtor two copies of a notice of his right to rescind the transaction. At the closing, New Century Mortgage, (failed to give the 4 copies of the rescission notices as required by TILA), the original mortgage holder which assigned it to Chase Home Finance. Then Chase Home Finance assigned illegally and fraudulently the mortgage to Deutsche Bank National Trust Company. The other original loan holder, DanversBank did not give Debtor his TILA right of rescission in accordance to Regulation Z. Then, DanversBank assigned the Mortgage to Commonwealth.

In fact, New Century Mortgage did not provide to Debtor and his wife, each two or a total of four copies of the Notice of Right to Cancel. The two original loan holders prior assigning it to Deutsche and Commonwealth failed to provide Debtor at the loan closing with two copies per person is a violation of 15 USC §§1638(a) and (b)(1), and M.G.L. c. 140D, §§12(a) and (b)(1), entitling Debtor to rescind the transaction pursuant to 15 USC §1635(a) and M.G.L. c. 140D, §10(a). The two original loan holders prior assigning it to Deutsche and Commonwealth failed to provide Debtor at the loan closing with a copy of his notice of the right to rescind the transaction is a violation of 15 USC 15 USC §1635(a) and M.G.L. c. 140D, §10(a) and 12(a), entitling Debtor to rescind the transaction pursuant to 15 USC §1635(a) and M.G.L. c. 140D, §10(a).

Failure to Honor Debtor-Debtor's Rescission Notice
On September 21, 2006, Debtor notified the Creditors that he has exercised his right to rescind the transaction pursuant to 15 U.S.C. §1635 and M.G.L. c. 140D, §10. Deutsche Bank National Trust Company, Commonwealth and Ameriquest refused to honor Debtor's rescission of the transaction, in violation of 15 U.S.C. §1635(b) and M.G.L. c. 140D, §10(b). Deutsche Bank National Trust Company, Commonwealth and Ameriquest's failure to honor Debtor-Debtor's rescission notice eliminates Debtor-Debtor's obligation to tender the net proceeds of the loan. Pursuant to 15 U.S.C. §1635(b) and M.G.L. c. 140D, §10(b), Debtor has no obligation to now tender that unpaid principal.

Breach of Contract and Unconscionable Conduct
Deutsche Bank National Trust Company, Commonwealth and Ameriquest's conduct were unconscionable and a breach of its contract.

The Creditors Has Failed to Answer timely to the TILA Rescission Notice
TILA provides that the security interest becomes void upon rescission, that the Creditors must return the Debtor’s money or property within twenty days and the Debtor’s duty to tender arises only upon the performance of the Creditors’ obligations 15 U.S.C. § 1635(b). The voiding of the security interest is the substance of the Debtor’s rescission right and thus cannot be altered by the courts. Regulation Z, adopted by the Federal Reserve Board to implement and interpret the Act, also makes it clear that the voiding of the security interest is not subject to modification by the court (12 C.F.R., 226.15(d)(4), 226.32(d)(4). The court further recognized the importance of making rescission a “painless remedy” for Debtor (“placing all burdens on the Creditors in this case”) in acting “as an important enforcement tool, insuring Creditors’ compliance with TILA’s disclosure requirements (Basnight v. Diamond Developers, Inc., 146 F. Supp. 2d 754 (M.D.N.C. 2001)).

The TILA is a strict liability rule
Where, as here, if, a Creditors does not respond to a properly served and ignores a duly issued TILA notice of rescission, an Entry of default, is the appropriate and, indeed, just and only recourse. According to The Office of the Comptroller of the Currency, “a consumer’s right to rescind is not affected by the sequence of the rescission procedures or a court order modifying those procedures in both open and closed-end credit (Comptroller of Currency, OCC Bulletin 2004-19 (May 7, 2004)). Since the Creditors do not appear disposed to follow and to abide by the rule of law of the Federal Truth-In-Lending Law, this Court has as the only avenue available to conclude this matter, the entry of default against Creditors for failure to comply by illegally proceeding with a foreclosure action despite having received the TILA rescission notice that automatically void the security interest as described in 15 USC 1635(b).

Creditor’s Burden of Proof
The TILA explicitly states that the Creditors have the burden of proving the defense by a “preponderance of the evidence” (Cody v. Community Loan Corp., Clearinghouse No. 16,161). Thus, Creditors have the burden of establishing three necessary elements of the bona fide error defense; 1) the error must have been unintentional, 2) it must have been the type of error falling within the statutory notion of bona fide error (the statute specifically states that “error[s] of legal judgment” do not qualify for the defense) and 3) the Creditors must have been maintaining procedures reasonably adapted to avoid the error since mere pleading of the defense is not sufficient.

The reason behind this seemingly harsh rule is that generally, "the conduct by the Creditors, of evading the consequences of the acts or omissions is wholly inconsistent with the system of litigation, in which each party is deemed bound by his acts. Aalmuhammed v. Kesten, 2003 WL 118512 (S.D.N.Y. Jan. 14, 2003) (citing cases). See also SEC v. McNulty, 137 F.3d at 739, citing Link v. Wabash R.R. Co., 370 U.S. 626, 633-34 (1962).

As such, the Creditors will probably claim Bono fide error, mistake or omission based on ignorance of the law, failure to follow rules and deadlines which are not bases for relieving the Creditors from an entry of default. See Canfield v. Van Atta Buick/GMC Truck, Inc., 127 F.3d 248, 250 (2d Cir. 1997); Dominguez v. United States, 583 F.2d 615, 616 (2d Cir. 1978) (per curiam); Nemaizer, 793 F.2d at 62; United States v. Cirami, 535 F.2d 736, 741 (2d Cir. 1976) ("Cirami I"); Cobos v. Adelphi University, 179 F.R.D. 381 (E.D.N.Y. 1998).

Non-compliance is a violation of the act which gives rise to a claim for actual and statutory damages under 15 USC 1640. TIL rescission does not only cancel a security interest in the property but it also cancels any liability for Debtor to pay finance and other charges, including accrued interest, points, broker fees, closing costs and that the lender must refund to Debtor all finance charges and fees paid.

Thus, DanversBank, Ameriquest Mortgage, Commonwealth Land Title Insurance Company, New Century Mortgage and Chase Home Finance are obligated to return those charges to Debtor (Pulphus v. Sullivan, 2003 WL 1964333, at *17 (N.D. Apr. 28, 2003) (citing lender’s duty to return consumer’s money as reason for allowing rescission of refinanced loan); McIntosh v. Irwing Union Bank & Trust Co., 215 F.R.D. 26 (D. Mass. 2003) (citing borrower’s right to be reimbursed for prepayment penalty as reason for allowing rescission of paid-off loan).

Debtor stated Claims upon which relief can be granted
By not responding timely to the TILA rescission notice, Debtor’s factual allegations must be taken as true for the purpose of the court ruling on the motion. Statute of limitations for damages for rescission violation runs from date of violation, which is the failure to act, which becomes a violation 20 days after the Creditors receive Debtor’s TILA rescission notice. Also, the court must construed the factual allegations in the light most favorable to Debtor with all doubts resolved in the pleaders favor and the allegations taken as true. (Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512 (2002)).

1. Debtor’s complaint need not alleged any specific wrong per se; rather it must merely notify the Creditors of the nature of the claim and state the ‘Relief Sought’. Debtor also alleges that all Creditors are liable for damages by virtue of their part in the civil conspiracy, fraud and trampling on the rights of Debtor’s by violating Federal and State Law.

2. Debtor alleges recoupment claims against Ameriquest Mortgage since Massachusetts allows it and for noncompliance with TILA.

3. Debtor alleges claims of abuse of process, noncompliance and misconduct against Creditors, New Century Mortgage, Chase Home Finance and Deuthsche Bank National Trust

4. Debtor alleges that Creditors Chase Home Finance, Commonwealth and Deuthsche Bank National Trust are not Holder in Due Course and they have no right or standing to foreclose on Debtor’s property since the assignee did not take the instrument in good faith (by fraud), for value, without notice that the loan is overdue and without notice that the Debtor had a defense. The Truth-In-Lending Act specifically provides that rescission is available against assignees, without exception (15 USC 1641 (c)).

5. Debtor alleges damage claims for Creditors failure to respond properly to the Debtor’s cancellation notice (Gerasta v. Hibernia Nat’l Bank, 575 F.2d 580 (5th Cir. 1978) Canty v. Equicredit Corp., 2003 WL 21243268 (E.D. Pa. May 8, 2003), (Clay v. Johnson, 77 F. Supp. 2d 879 (N.D. ILL 1999)(borrowers can get damages for rescission violation if rescission is exercised within 3-year period)

6. Debtor alleges Tort claims for Negligence (violatons of TILA) and intentional infliction of Emotional Distress (Debtor alleges that Creditors, New Century Mortgage, Chase Home Finance and Deuthsche Bank National Trust, conduct of moving forward with an illegal foreclosure action and fraudulent transferred Debtor’s deed on January 29, 2007 were intentional and reckless which causes severe emotional distress to Debtor.

7. Debtor alleges intentional interference with contractual relations since Creditors have forced placed insurance on the property even though a Debtor insurance policy was fully active.

8. Debtor alleges that Creditors failed to comply with the statutory mandates by ignoring Debtor’s TILA notice of rescission caused those Creditors to lose the right to recover the money or property delivered as part of the transaction and for illegally going forward with foreclosure action and fraudulently transferring deed without the authorization or knowledge of Debtor and his wife.

9. Thus, Debtor ask this court for the right to retain all proceeds (in re Lang, Clearinghouse No. 45,907 (D. or. Aug. 1, 1990) since negation of tender duty is appropriate where Creditors do not comply with rescission notice since the fundamental duty of the court is to protect the integrity of the statutory policy. (Congress’ intended operation of the statute, as evidenced by the 1635(b) creditor-forfeiture provision, clearly calls for a debtor ‘windfall’ if the creditor does not respond to a valid rescission notice by following the statutory dictates (French v. Wilson, 446 F. Supp. 216, 220 (D.R.I. 1976)). Such a result helps to assure self-enforcement and ultimately promotes uniform compliance by creditors with the Truth-In-Lending Act.

10. Debtor alleges violations of the Federal Fair Debt Collection Practices Act and Massachusetts Debt Collection Laws, Violation of the Fair Credit Reporting ACT and seeking punitive damages per 15 USC 1681 n(a)(2), 15 USC 1681o, 15 USC 1692e(8) because their premature report caused Debtor, his wife, and 4 children unable to attend school and to be classified as homeless in the state of Virginia for a week as a result of false report that the mortgage was foreclosed upon even though Creditors had received the TILA notice of rescission on September 21, 2006 which voided automatically the security interest in Debtor’s home.

11. Debtor alleges libel claims because the malicious written and reported notice of foreclose mortgage caused the harms mentioned above to Debtors and all his families members as a result of the defamatory language in making false statement to credit reporting agencies that his account with the mortgage companies was delinquent. (Johnson v. Citimortgage, Inc., 351 F. Supp. 2d 1368 (N.D. Ga. 2004)

12. Debtor alleges claims for loss of consortium, severe emotional distress, punitive or exemplary damages due to the misconduct of Creditors of trampling my TILA rescission rights intentionally.

Mortgage FRAUD As a Defense To Foreclosure
As pointed, there is a civil conspiracy by Creditors New Century Mortgage, Chase Home Finance and Deuthsche Bank National Trust in committing fraud on (1/29/2007) at the Massachusetts (Lowell) Registry of Deed by making:

1) a false representation by setting aside and ignoring the Debtor’s TILA notice of rescission,

2) the person who made that false statement made it knowingly to conceal since it is a routine verification readily available from public document filed at the registry of deed,

3) the receiver of that statement meaning all parties involved in the assignment of Debtor’s property and deed were well aware that the TILA notice of rescission voided automatically the security interest in the property and that Debtor is awaiting a FREE and CLEAR title from Creditors was indeed ‘clear’ since this is a premeditate action of civil conspiracy to defraud Debtor,

4) based on that civil conspiracy to commit FRAUD at the registry of deed, it stripped away Debtor right or proof of ownership of his principal dwelling located at 26-28-30 Cedar Street, Lowell, Massachusetts which is the result of predatory lending damages by fraudulently taking over the deed of Debtor’s property to deprive him of his legal right to protect his property rights in the near future should their illegal and fraudulent action of foreclosure is allowed to go un-notice in the court system (Federal and State),

5) Debtor trusted and believed that all the parties involved in this litigation had a responsibility not to deceive him by usurping and trampling the TILA rule of law and his affirmative defense (15USC 1635(i)) to foreclosure action, assuring that the outcome would not be to Debtor’s detrimental as the Creditors are aiming illegally and fraudulently to achieve their goal (In re Rockefeller Ctr. Props., Inc. Secs. Litig., 311 F. 3d 198, 216 (3d Cir. 2002).

Debtor alleges ‘breach of the implied covenant of good faith and fair dealing’ since the bad faith effort of New Century Mortgage, Chase Home Finance and Deuthsche Bank National Trust and its counsel to make reasonable care or due diligence in finding out that their foreclosure action was not valid, civil conspiracy in fraudulently assigning Debtor’s deed and to avoid inappropriate argument before filing document that has no significance relevance with the intent to confuse the court by masquerading the facts in hope to shield Creditors from fraud and other wrongdoings because Debtor’s TILA notice of rescission has legal influence and precedence over Creditors illegal and fraudulent foreclosure actions. (Whitehead v. Food Max of Mississipi, Inc., 332 F. 3d 796 (5th Cir. 2003)).


TILA & Res Judicata - A rescission action may not be barred by prior or subsequent TIL litigation which did not involve rescission (Smith v. Wells Fargo Credit Corp., 713 F. Supp. 354 (D. Ariz. 1989) (state court action involving, inter alia TIL disclosure violations did not bar a subsequent action based on rescission notice violations in conjunction with same transaction which were not alleged or litigated in prior action) (See also In re Laubach, 77 B.R. 483 (Bankr. E.D. Pa. 1987) (doctrine of merger bars raising state and federal law claims arising from a transaction on which a previous successful federal TILA action was based; merger does not bar, however, rescission-based on the same transaction)).
Debtor has rescinded while in bankruptcy, courts have held that the rescission effectively voids the security interest, rendering the debt, if any, unsecured. (See in re Perkins, 106 B.R. 863, 874 (Bankr. E.D.Pa. 1989); In re Brown, 134 B.R. 134 (Bankr. E.D.Pa. 1991); In re Moore, 117 B.R. 135 (Bankr.E.D. Pa. 1990)).

Since DanversBank, Ameriquest Mortgage, Commonwealth Land Title Insurance Company, New Century Mortgage and Chase Home Finance have not cancelled the security interest and return all monies paid by Debtor within the 20 days of receipt of the letter of rescission of September 21, 2006, the lenders named above are responsible for actual and statutory damages pursuant to 15 U.S.C. § 1640(a).

Also, DanversBank, Ameriquest Mortgage, Commonwealth Land Title Insurance Company, New Century Mortgage and Chase Home Finance are to take any necessary or appropriate action to reflect the fact that the security interest was automatically terminated by the rescission (15 USC 1635(b); Reg. Z-226.15(d)(2),226.23(d)(2). This requires canceling documents creating the security interest and filing release or termination statements in the public record of FREE and CLEAR TITLE because Creditors have failed to respond to the TILA notice of rescission, illegally and fraudulently pursuing foreclosure action in defiance of Debtor’s TILA right of rescission.

Requested Relief
WHEREFORE, the Debtor respectfully requests that this honorable Court:

a. Declare that the Debtor has validly rescinded the transaction, that the Creditors's security interest is therefore void and unenforceable per TILA enacted by Congress;

b. Declare that the Creditors's failure to honor the Debtor 's valid rescission notice in accordance with the dictates of 15 USC §1635 and M.G.L. c. 140D §10 vests in the Debtor the right to retain the net loan proceeds and that the Creditors has no allowable unsecured claim in this bankruptcy case;

c. Enter an order requiring the Creditors to refund to the Debtor all money paid to the Creditors in connection with the transaction;

d. Award the Debtor statutory damages for the Creditors' failure to comply with 15 U.S.C. §1638 and c. 140D §12, and award the Debtor additional statutory damages for the Creditors' failure to comply with 15 U.S.C. §1635(b) and c. 140D §10;

e. Award the Debtor his reasonable attorney's fees and costs; and

f. Grant such other relief as the Court deems appropriate and just.

g. That the foreclosure action brought by ‘Deutsche’ be enjoined pending a final adjudication of this action;

h. That the Court award such other relief as it deems just and proper;

Because of the irrefutable fact of violation such as not responding to the TILA rescission letter, no matter how technical, this court has no discretion with respect to liability (in re Wright, supra. At 708; In re Porter v. Mid-Penn Consumer Discount Co., 961 F,2d 1066, 1078 (3d. Cir. 1992); Smith v. Fidelity Consumer Discount Co., Supra. At 898. Any misgivings Creditors may have about the technical nature of the requirements should be addressed to Congress or the Federal Reserve Board, not the courts.

Respectfully submitted,

___________________________
Pierre R. Augustin, Pro Se, Debtor
28 Cedar Street, Lowell, MA 01852
Tel: 617-202-8069

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