Thursday, September 23, 2010

She's Leaving Home

You might ask why this is in a farm law blog, and the simple answer is that we in the farm belt have seen this all before, particularly those of us with long memories of the cold seventies and blustery eighties. We ended up with farm debt mediation, which turned out to be a pretty useful tool for keeping people honest.

The Washington Post reports this morning that the foreclosure process is "...riddled with faked documents, forged signatures, and lenders who take shortcuts reviewing borrower's files...the problems, which are so widespread that some judges approving the foreclosures are ignoring them, are coming to light as (the inartfully named-ed.) Ally Financial, the country's fourth biggest lender halted home evictions in 23 states this week."

The tale goes on to describe how an employee of GMAC Financial signed off on at least 10,000 foreclosure papers a month without verifying whether the information justified the process, as did a flunky who worked for JP Morgan Chase. A low level flunky at another foreclosure bucket house claimed to be an executive of Bank of America, Wells Fargo, US Bank and numerous other anthropophages while signing off on foreclosure affidavits-which, of course, are subject to the penalties of perjury. To add to the mess, numerous other flunkies forged the perjurer's signature too-poetic justice of a sort, no?

As a prefatory matter, we at the Dougloid Towers have always liked our poison straight, undiluted, and bottled in bond. We recommend that all banks, mortgage bucket shops, and all floggers of dodgy loans should be compelled to add to their corporate names the following suffix: "A predatory, onerous and prevaricating retailer, so be warned We'll screw you to the wall if we get a chance." until proven otherwise.

Truth in lending, y'know.

Yet, the pattern has always been clear. Creditor side litigators and their sycophants and toadies in the law firms that service them are infamous for dodging the law, and the robobanks that enforce the garnishments are oblivious to even the simplest principles-such as, you can't garnish social security or pension money.

It used to happen all the time when I was in that trade, and the main reason it happened was that the creditor side got arrogant, and the reason they got arrogant is that debtors usually do not have the kind of money it takes to hire a conscientious and thorough attorney who will put the creditor to their proof in the time allotted. So why should the foreclosure process be any different?

So...what's the takehome?

Well, those of us who have at one time or another labored in debtor side litigation have known this for years, and it forced some of us into dodgy alliances with outfits that were predatory bottom feeders lunching on the remains that fall off the conveyor belt that leads to the bankruptcy courts. The occasional victory was sweet.

That being said, many of the foreclosures are justified, because the banks of all people should know that they lent mortgage money to people who did not have a prayer of paying it back unless property continued to appreciate at 20 per cent per annum, world without end, amen.

The banks, of course, are now acting for all the world like reformed drunks at a church picnic.

If you're looking at this coming down the road, you're entitled-and should feel obliged- to put the bank to its proof, and it is highly recommended that you do so, at the most advantageous time in the process. Check everything out, including names, dates, places, people, the validity of notarial offices, jurisdictional issues, proofs of service, and all other formal requirements.

Chances are good that you can trip them up and stall the process. You may not win in the end but you'll at least have the comfort of knowing you made somebody's life truly miserable for a while.

Wednesday, September 22, 2010

Mr. Marcellus And His Shale

Editor's Note: Folks, I've been remiss in my blogging duties because some other things have occupied a lot of time in the last few months-primarily my defense and teaching duties plus the life of a country gentleman maintaining a chunk of land and an old house takes up an inordinate amount of time. However, it is my intention to get on the case and get current. My extended coffee break is over.

A lot of my friends in rural New York and Pennsylvania are up in arms over the issue of natural gas extraction and how it is starting to take place in areas where the Marcellus Shale layer has now become profitable to drill into. In particular they don't much like the process of hydrofracturing, and they say with some truth to it that it poses serious environmental problems for rural folks who use shallow water wells for their domestic uses.

As it happens we've had the same thing here (shallow water well and ground water contamination) for a long time-the contaminants are more localized but the problem is similar in scope.

Here's how I responded to a fellow over on a social network I spend altogether too much time noodling around on. You know which one I'm talking about.

The point is, Stephen, that a lot of folks-not saying you're one of them of course-a lot of folks don't bitch about stuff until their ox gets gored, so to speak. The problem y'all have if you've got the Marcellus shale formation in your basement is, you don't have any lawyers in your area who know anything about oil and gas law because nobody's ever figured out how to get at the stuff until recently, and not that many folks in the region are knowledgeable about gas extraction technology and what it can be made to do as well as what the dangers are.

Added: That's simply because nobody ever had a need to know about this stuff until recently. Michigan farmers could probably write the book on it because I think there's only one or two counties that do not have some level of oil or gas drilling activity in them.*

Remember that it isn't what people know that's dangerous, it's what they know that ain't so.

Here's my prediction for the next fifty years.

The gas is there, and there's a lot of it. Extraction of it is a matter of private property rights, so it is going to be brought up from the ground and sold, and there's not a whole lot people can do about that without rewriting the last 350 years of American law. It's an emotional issue particularly when one group of people wants to scotch what should be a comfortable retirement in Florida for some farmer and his wife because of what's under their land that they've scratched out a living on for the last 50 years or so. Nobody's got the right to condemn other people to penury because they don't like what they're doing.

Two things will happen.

First, you can expect that rural water districts with centralized distribution will become the norm in all the areas where people get their drinking water from shallow wells. This is what's happened here because of farm nitrate runoff-basically, animal shit and piss and fertilizers. As long as you've got shallow water wells in the front yard and a septic tank or drain field in the back and farm animals wandering around, nobody's got a principled right to complain they suddenly don't like the taste of their drinking water. That's been the history here on the prairie for the last 150 years.

Second, the petroleum drillers and producers will have to start doing a better and cleaner job of drilling and cementing, and they're going to have to use simpler and less offensive methods of hydrofracturing. The people who are against it will have to get used to the idea that it can be made environmentally safe and will have to insist on that as a precondition to getting a drilling permit, and they'll also have to get used to the idea that private property is a pretty important idea.

Image of the rig courtesy of Chief Oil and Gas. They've got a very informative website.