Court to hear foreclosure case

Decision in appeal by Howard Co. man could affect similar cases

The Maryland Court of Appeals has agreed to hear arguments in the foreclosure case of Kwaku Atta Poku, the Columbia cab owner who lost his home after refinancing, despite making every mortgage payment.

The decision by the state's highest court to review the case pleased Atta Poku and his lawyers, and the outcome also could affect how Maryland courts handle similar cases as foreclosures become more common in the slumping Maryland housing market.

Gerald M. Richman of Ellicott City, one of Atta Poku's lawyers, said the court will "determine whether or not you have a right to appeal a foreclosure action."

Another issue is whether a home can be foreclosed on when the lender has exclusive control of the funds to pay off the mortgage. Atta Poku never had possession of the settlement check involved in the 2001 refinancing that later resulted in foreclosure. He could not prove the mortgage was paid, however, because a bank lost the original check.

The Court of Appeals said a hearing will be scheduled in December after submission of legal briefs, according to an order received Friday by another of Atta Poku's lawyers, Scott C. Borison of Frederick, a foreclosure specialist.

Depending on what the court decides, homeowners could gain a better chance to defend themselves.

"It may alter the [foreclosure] process," Richman said.

Maryland law allows mortgage holders to foreclose in a few weeks, without having to prove the homeowner was notified.

"It's predictable there will be other people like Mr. Atta Poku," said Phillip Robinson, executive director of Civil Justice Inc., a nonprofit public advocacy law firm that has been allowed by the court to join in the Atta Poku case. "We're also seeing a substantial increase in the number of title companies using escrow funds to pay operating expenses."

With some members of the General Assembly planning to revise Maryland's laws next year to give homeowners more time and notice to fight mortgage company foreclosures, Robinson said the Court of Appeals could help by clarifying the legal issues.

For Atta Poku, the news stirred an emotional response.

"Oh ... oh ... I don't know what to say," he said, after hearing Monday of the court's action. "I didn't have a chance [in court]. All that I tried was in vain."

The 2005 foreclosure on his Columbia townhouse, and his family's August 2006 eviction, was upheld May 8 by the Maryland Court of Special Appeals on what his lawyers said were technical grounds, including his inability to post a required bond. The Court of Appeals decision gives Atta Poku new hope and a chance to argue the substance of his case, his lawyers said.

Borison and Richman said Atta Poku will not regain possession of his house, which was sold after the foreclosure.

But if the Court of Appeals decides the taking was not justified, it would give Atta Poku a stronger legal basis for damage claims that he is also seeking.

Washington Mutual Inc., the Seattle-based mortgage company that took his house, maintains that its action was proper, pointing to court rulings that sustained the foreclosure. Shane A. Winn, a company spokesman, declined to comment yesterday, noting pending litigation.

"Oh, my Lord, that's wonderful!" Richman said when he learned of the court's decision to hear the appeal.

Robinson said the court takes fewer than 10 percent of the cases it is requested to review.

Atta Poku's house was sold less than six weeks after he first received notice that Washington Mutual, which refinanced his loan in 2001, claimed that the first mortgage was never paid off.

Atta Poku, 55, a naturalized American citizen originally from Ghana, was unable to prove in court that the loan was paid, as he insists it was, partly because the financial institutions involved lost some of the documents.

Although no one -- including Washington Mutual -- has blamed him for the alleged default, he lost the house, has ruined credit and his AAAA Star cab business was damaged.

The family of five, including his wife and three children younger than age 5, is being aided by a small cash fund administered by Columbia's Grassroots Crisis Intervention Center, and by Congregations Concerned for the Homeless, a Howard County nonprofit group that rented a three-bedroom townhouse last week for the family to sublet. (By Larry Carson, Sun reporter)