Kwaku Atta Poku and his family lost their townhouse to foreclosure after he could not prove he had paid off a mortgage.
A lawyer for Kwaku Atta Poku, the Columbia cab owner from Ghana who lost his house to foreclosure although he had made every mortgage payment, tried yesterday to convince skeptical Maryland Court of Appeals judges that they can grant him a legal way to recoup his financial losses without undermining the state's real estate system.
Attorney Scott C. Borison said his task was to show the judges on the state's highest court that Atta Poku had been placed in a "Kafkaesque" situation through no fault of his own, and that they could open a way for him to pursue a negligence claim.
Under current law, he said, a foreclosure can go through in 15 days, although it could take 30 days to get a ruling to stop it. If the court decides in Atta Poku's favor, it could change the rules governing foreclosures in Maryland.
Kenneth MacFayden, the attorney arguing for Washington Mutual Inc., the mortgage firm that took Atta Poku's townhouse and resold it more than two years ago, suggested such a ruling would reverse a legal foreclosure and affect an owner's ability to sell a property with a foreclosure in its history.
"How will I ever be able to transfer title and get title insurance again?" MacFayden asked the judges.
"What do I do about the fact that the property was sold? What do I do?" Judge Alan M. Wilner asked Borison.
Borison later agreed that, "the sale has occurred. The house is gone. There's nothing to get back."
Borison said he was trying to allow Atta Poku a way to recoup his financial losses - a dim prospect if the foreclosure is judged legal.
"My claim is real simple. Mr. Atta Poku went to these people to refinance. He didn't take any money out of the transaction," Borison said, noting that Washington Mutual or its sister companies held the original mortgage and also did the refinancing.
"They were taking money from one pocket and putting it in another," he said.
No one representing Washington Mutual has accused Atta Poku of causing the foreclosure. Shane Winn, the company's spokesman, has said Washington Mutual never received the settlement check satisfying the first mortgage after the refinancing. Atta Poku could not prove they received it because several key documents, including the settlement check itself, were lost by financial institutions.
Judge Dale R. Cathell noted another difficult aspect of the case.
"You're asking us to do something we haven't done before," he told Borison.
Later Cathell said, "I don't mean to say there's not been a wrong done," he said. "How is it corrected? I just don't know how to do it. I can't for the life of me understand how do you ratify a sale, and not ratify a sale?"
Judge Irma S. Raker asked MacFayden: "How could Mr. Atta Poku have avoided all this once this train started moving?"
MacFayden said Atta Poku could have sought an injunction to stop the foreclosure, and filed lawsuits against the settlement company, its agent, and the bank involved. MacFayden said he suspects the money was embezzled. But Borison said Atta Poku didn't get a lawyer licensed to practice in Maryland until after the foreclosure and the sale - a period of a few weeks.
Atta Poku sat in the court's front row, watching as the opposing lawyers answered questions from the seven red-robed judges.
After the nearly one-hour hearing in Annapolis, he said he had expected to hear more about the human side of his predicament.
"I'm just hoping all these technicalities will be resolved," he said. "If the law keeps all these technicalities - then justice will be stampeded."
After the hearing, J. Preston Turner, a Towson lawyer also representing the mortgage company, approached Atta Poku and offered to discuss the possibility of a settlement. Borison said he's more likely to wait for the high court's decision. (By Larry Carson |Baltimore Sun)
Showing posts with label lawsuit. Show all posts
Showing posts with label lawsuit. Show all posts
Friday, December 7, 2007
Wednesday, August 15, 2007
Jury awards $4 million in lead case
Damages could be reduced under state-cap law, attorney for city housing authority says.
A city jury has found that the Housing Authority of Baltimore City should pay $4 million in damages to two siblings poisoned by lead paint in their publicly owned rowhouse in the 1980s.
The verdict - issued Thursday - directed $2.5 million to Joseph Avery Jr., 23, of the 3000 block of Rosedale Court and $1.5 million to his sister, Lisa Avery, 21, of the 1700 block of McCulloh St.
The family filed suit against the housing authority in 2005.
The damages could be reduced to a maximum of $350,000 for each sibling under the state payment caps in place at the time they were tested for lead poisoning, said J. Marks Moore III, the attorney for the housing authority's insurance company. The city may appeal the verdict.
But Bruce H. Powell, the Averys' attorney, said he plans on challenging the state cap in a post-trial hearing Aug. 29.
"You have a right to a jury trial, and you have a right to what the jury awards you," Powell said. "The jury thought that they were compensating these people in a way that was fair, and that's not the case."
Lead poisoning, which often occurs when children ingest chipped household paint, can cause mental problems, including cognitive deficits and aggressive behavior.
At the four-day trial, a vocational rehabilitation expert testified that the Avery siblings show symptoms of lead poisoning. Both were in special education, and neither earned a high school diploma.
Last year, 1,274 children in Maryland had lead poisoning, according to statistics from the Maryland Department of the Environment.
That figure includes 936 newly reported cases, 573 of which occurred in Baltimore.
As more research has emerged highlighting effects of lead poisoning, the amount in damages paid by property owners has increased, Moore said.
Since the early 1990s, Moore has handled at least 200 lead poisoning cases for the housing authority, with 10 reaching trial. When he started, a typical verdict ordered $200,000 in damage payments, he said.
"Now, you see just about all of them in the millions," he said. "They really don't have a basis in relation to the underlying facts of the case. I think they're excessive."
The housing authority deferred questions about its lead poisoning cases to Moore.
Ruth Ann Norton, executive director of Baltimore's Coalition to End Childhood Lead Poisoning, said that most current cases of childhood lead poisoning can be blamed on private landlords rather than public housing.
Many city houses built through the 1950s included lead paint. Since it was banned nationwide in 1978, the city has worked to repair lead-tainted houses it owns and reach out to poisoned children, Norton said.
"There has been much progress made there in the intervening 20 years, and so a child living in city-owned housing today would have hopefully a much different experience," she said.
The Averys' mother, Trina Ashley, moved into a Gilmor Homes rowhouse on Bakbury Court in 1984, shortly before giving birth to Joseph. The housing authority had built the home in 1940 with specifications that indicated that lead paint was used.
While living in the home, Ashley repeatedly complained about flaking lead paint, Powell said. In 1986 and 1987, the children were tested for lead and found to have levels that were acceptable at the time but later considered poisonous by Centers for Disease Control and Prevention standards.
In 1988, the Health Department tested the home for chipped lead paint and found it in five locations.
The only location where the lead concentration exceeded acceptable amounts was the front door, and whether the now-deceased surveyor's report indicated lead had been found in the other locations was a trial issue.
A month after the house was tested, the family moved. (baltimoresun.com)
A city jury has found that the Housing Authority of Baltimore City should pay $4 million in damages to two siblings poisoned by lead paint in their publicly owned rowhouse in the 1980s.
The verdict - issued Thursday - directed $2.5 million to Joseph Avery Jr., 23, of the 3000 block of Rosedale Court and $1.5 million to his sister, Lisa Avery, 21, of the 1700 block of McCulloh St.
The family filed suit against the housing authority in 2005.
The damages could be reduced to a maximum of $350,000 for each sibling under the state payment caps in place at the time they were tested for lead poisoning, said J. Marks Moore III, the attorney for the housing authority's insurance company. The city may appeal the verdict.
But Bruce H. Powell, the Averys' attorney, said he plans on challenging the state cap in a post-trial hearing Aug. 29.
"You have a right to a jury trial, and you have a right to what the jury awards you," Powell said. "The jury thought that they were compensating these people in a way that was fair, and that's not the case."
Lead poisoning, which often occurs when children ingest chipped household paint, can cause mental problems, including cognitive deficits and aggressive behavior.
At the four-day trial, a vocational rehabilitation expert testified that the Avery siblings show symptoms of lead poisoning. Both were in special education, and neither earned a high school diploma.
Last year, 1,274 children in Maryland had lead poisoning, according to statistics from the Maryland Department of the Environment.
That figure includes 936 newly reported cases, 573 of which occurred in Baltimore.
As more research has emerged highlighting effects of lead poisoning, the amount in damages paid by property owners has increased, Moore said.
Since the early 1990s, Moore has handled at least 200 lead poisoning cases for the housing authority, with 10 reaching trial. When he started, a typical verdict ordered $200,000 in damage payments, he said.
"Now, you see just about all of them in the millions," he said. "They really don't have a basis in relation to the underlying facts of the case. I think they're excessive."
The housing authority deferred questions about its lead poisoning cases to Moore.
Ruth Ann Norton, executive director of Baltimore's Coalition to End Childhood Lead Poisoning, said that most current cases of childhood lead poisoning can be blamed on private landlords rather than public housing.
Many city houses built through the 1950s included lead paint. Since it was banned nationwide in 1978, the city has worked to repair lead-tainted houses it owns and reach out to poisoned children, Norton said.
"There has been much progress made there in the intervening 20 years, and so a child living in city-owned housing today would have hopefully a much different experience," she said.
The Averys' mother, Trina Ashley, moved into a Gilmor Homes rowhouse on Bakbury Court in 1984, shortly before giving birth to Joseph. The housing authority had built the home in 1940 with specifications that indicated that lead paint was used.
While living in the home, Ashley repeatedly complained about flaking lead paint, Powell said. In 1986 and 1987, the children were tested for lead and found to have levels that were acceptable at the time but later considered poisonous by Centers for Disease Control and Prevention standards.
In 1988, the Health Department tested the home for chipped lead paint and found it in five locations.
The only location where the lead concentration exceeded acceptable amounts was the front door, and whether the now-deceased surveyor's report indicated lead had been found in the other locations was a trial issue.
A month after the house was tested, the family moved. (baltimoresun.com)
Tuesday, July 17, 2007
Md. notifies borrowers in Ameriquest settlement
12,340 customers in state are eligible for restitution of several hundred dollars
Marylanders who got home loans from Ameriquest Mortgage Co. can begin to claim their share of a $325 million settlement reached with the subprime lender that was accused of preying upon borrowers nationwide with deceptive practices.
Douglas F. Gansler, Maryland's attorney general, announced yesterday that his agency and the Maryland commissioner of financial regulation sent letters and claim forms this week to 12,340 Ameriquest customers in Maryland who are eligible for $7.8 million in restitution.
Depending on how they were harmed, borrowers could receive hundreds, and in some cases thousands, of dollars.
Ameriquest, a subsidiary of ACC Capital Holdings in Orange, Calif., agreed in January 2006 to settle the case brought by 49 states, including Maryland, after a two-year investigation. Under the agreement, the company has been paying into a settlement fund in installments.
"It's a very, very large amount of money, so we allowed them to pay quarterly, rather than come up with the entire amount all at once," said V. Scott Bailey, a Maryland assistant attorney general. "That would have put them out of business, and in that case it would have been questionable how much we could have collected for consumers."
Regulators said the lender, which consented to changing its lending practices but didn't admit any wrongdoing, misrepresented the terms of home loans, such as whether it carried a fixed or an adjustable rate.
The lender and its affiliates also charged excessive loan origination fees and prepayment penalties; refinanced borrowers into inappropriate loans, and inflated appraisals used to qualify borrowers for loans, regulators said. Ameriquest has been retrenching along with the subprime industry, which has been roiled by losses from rising foreclosures. Subprime loans are made to borrowers with bad credit histories or heavy debt.
The mortgages often charge higher interest rates to compensate for the greater risk of default.
Dozens of subprime mortgage companies have declared bankruptcy, shuttered operations or been sold in recent months. Ameriquest, which was one of the largest, closed more than 200 branch offices last year and consolidated operations into four call centers.This year the company moved those operations into one call center in Orange, spokesman Chris Orlando said.
The National Association for the Advancement of Colored People sued Ameriquest and other lenders this week. The civil rights group alleges that the lenders discriminated against black borrowers by steering them into higher-interest subprime loans while giving more favorable loan terms to whites.
As for the multistate settlement, Orlando called the restitution "an important final step." The settlement covers customers of Ameriquest, Town and Country Credit Corp., and AMC Mortgage Services, formerly known as Bedford Home Loans, from January 1999 through December 2005.
Consumers owed restitution will be paid out under two tiers depending on how they were allegedly deceived. One will pay out an average of $756; the other an average of $569.
The forms mailed to eligible borrowers indicate a minimum payment they can expect to receive, though that figure could grow if fewer borrowers decide to take part in the settlement.
Consumers who do opt for the settlement give up their right to sue Ameriquest over the loans that are covered; they would not be giving up any claim they could otherwise raise if their homes go into foreclosure.
Gansler's office encouraged consumers to consult a private attorney or seek subsidized legal services. They must mail competed and signed forms to the settlement administrator by Sept. 10. (baltimoresun.com)
Marylanders who got home loans from Ameriquest Mortgage Co. can begin to claim their share of a $325 million settlement reached with the subprime lender that was accused of preying upon borrowers nationwide with deceptive practices.
Douglas F. Gansler, Maryland's attorney general, announced yesterday that his agency and the Maryland commissioner of financial regulation sent letters and claim forms this week to 12,340 Ameriquest customers in Maryland who are eligible for $7.8 million in restitution.
Depending on how they were harmed, borrowers could receive hundreds, and in some cases thousands, of dollars.
Ameriquest, a subsidiary of ACC Capital Holdings in Orange, Calif., agreed in January 2006 to settle the case brought by 49 states, including Maryland, after a two-year investigation. Under the agreement, the company has been paying into a settlement fund in installments.
"It's a very, very large amount of money, so we allowed them to pay quarterly, rather than come up with the entire amount all at once," said V. Scott Bailey, a Maryland assistant attorney general. "That would have put them out of business, and in that case it would have been questionable how much we could have collected for consumers."
Regulators said the lender, which consented to changing its lending practices but didn't admit any wrongdoing, misrepresented the terms of home loans, such as whether it carried a fixed or an adjustable rate.
The lender and its affiliates also charged excessive loan origination fees and prepayment penalties; refinanced borrowers into inappropriate loans, and inflated appraisals used to qualify borrowers for loans, regulators said. Ameriquest has been retrenching along with the subprime industry, which has been roiled by losses from rising foreclosures. Subprime loans are made to borrowers with bad credit histories or heavy debt.
The mortgages often charge higher interest rates to compensate for the greater risk of default.
Dozens of subprime mortgage companies have declared bankruptcy, shuttered operations or been sold in recent months. Ameriquest, which was one of the largest, closed more than 200 branch offices last year and consolidated operations into four call centers.This year the company moved those operations into one call center in Orange, spokesman Chris Orlando said.
The National Association for the Advancement of Colored People sued Ameriquest and other lenders this week. The civil rights group alleges that the lenders discriminated against black borrowers by steering them into higher-interest subprime loans while giving more favorable loan terms to whites.
As for the multistate settlement, Orlando called the restitution "an important final step." The settlement covers customers of Ameriquest, Town and Country Credit Corp., and AMC Mortgage Services, formerly known as Bedford Home Loans, from January 1999 through December 2005.
Consumers owed restitution will be paid out under two tiers depending on how they were allegedly deceived. One will pay out an average of $756; the other an average of $569.
The forms mailed to eligible borrowers indicate a minimum payment they can expect to receive, though that figure could grow if fewer borrowers decide to take part in the settlement.
Consumers who do opt for the settlement give up their right to sue Ameriquest over the loans that are covered; they would not be giving up any claim they could otherwise raise if their homes go into foreclosure.
Gansler's office encouraged consumers to consult a private attorney or seek subsidized legal services. They must mail competed and signed forms to the settlement administrator by Sept. 10. (baltimoresun.com)
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