Mortgage Foreclosure: Vice President of What?

Posted By Cliff Tuttle | August 15, 2010

No. 494

There have been so many foreclosures in recent years that it has become an undue burden on the time of officers of foreclosing parties to sign, let alone read, the cookie cutter pleadings that continue to pour into the courts.  Truth is, the nominal plaintiffs, primarily trustees for real estate investment trusts, just want the non-producing assets to be promptly liquidated so they can be quickly sold.  Don’t bother them with the details — somebody else is in charge of that anyway.

Because their clients gave them no choice, attorneys at foreclosure factories have been signing verifications of complaints and other pleadings for years.  Since this practice is not authorized under the Pennsylvania Rules of Civil Procedure, the detour to motions court and preliminary objections was becoming a well-worn path.

And then, a few years ago, Complaints started turning up signed by “Vice Presidents of Documentation” or persons with similar titles who were, you guessed it, lawyers at the same law firm where the complaint was being generated. Of course, the only responsibility of these vice presidents was to sign verifications.  According to stories told by certain anonymous sources, the VPD would have to set aside whole days for “signing parties”. The stories don’t relate whether the VPD actually read the complaints she verified and knew from personal knowledge that the information stated therein was true and correct.

Meanwhile, the organization known as MERS, which has acted as a “nominee” in millions of home mortgage transactions to save on the preparation and filing of assignments of mortgages, was increasingly being named as plaintiff in mortgage foreclosures because it was the mortgagee party of record.  Its response to the deluge of requests for verifications was to appoint thousands of vice presidents spread around the country whose only responsibility is to sign verifications.

Somewhere along the line, lawyers started to complain and judges started to notice.  The purpose of the Rule has been forgotten: to confirm that the averments in the complaint are true and accurate according to a person with personal knowledge and the authority to sign the verification.

Chances are that the plaintiffs cannot produce resolutions of the appropriate boards of directors electing these so-called officers.  But even if they could (and they eventually will, if pressed), the truth is that these vice presidencies are bogus.  They are fictitious offices created for the sole purpose of avoiding  the responsibility of every litigant to review the allegations set forth in a complaint written by an attorney, who is presumed by the authors of the Rules not to have first hand knowledge of the facts.

CLT

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CLIFF TUTTLE has been a Pennsylvania lawyer for over 45 years and (inter alia) is a real estate litigator and legal writer. The posts in this blog are intended to provide general information about legal topics of interest to lawyers and consumers with a Pittsburgh and Western Pennsylvania focus. However, this information does not constitute legal advice and there is no lawyer-client relationship created when you read this blog. You are encouraged to leave comments but be aware that posted comments can be read by others. If you wish to contact me in privacy, please use the Contact Form located immediately below this message. I will reply promptly and in strict confidence.

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