Emergency Economic Stabilization Act of 2008

110th Congress, 2007–2009 A bill to provide authority for the Federal Government to purchase and insure certain types of troubled assets for the purposes of providing stability to and preventing disruption in the economy and financial system and protecting taxpayers, to amend the Internal Revenue Code of 1986 to provide incentives for energy production and conservation, to extend certain expiring provisions, to provide individual income tax relief, and for other purposes.

Introduced: Mar 09, 2007

Constructive trust - The Counter to Courts Discretionary Powers

A constructive trust is not a trust per say within the true meaning of the word trust . Courts hold in numerous cases that a transferee who uses fraud to obtain the transfer of property is a constructive trustee. We look here  to a relationship by which a person has obtained title to property

 

We believe the court will uphold the equitable duty to transfer it to another, to whom it rightfully belongs, on the basis that the acquisition or retention of it is wrongful and would unjustly enrich the person if he or she were allowed to retain it. Constructive trust does not arise because of the expressed intent of a sponsor who establishes a trust. It is created by a court whenever title to property is held by a person who, in fairness, should not be permitted to retain it. It is

A constructive trust is frequently based on disloyalty or other breach of trust by an express trustee (the person appointed or required by law to execute a trust), and it is also created where no express trust is created but property is obtained or retained by other wrongful conduct.

 

The court shall hear th emotion for constructive trust as a remedial device to compel the defendant to convey title to the property to the plaintiff. It treats the defendant as if he or she had been an express trustee from the date of the unlawful holding of the property in question. Herein the objective is to examine the claims of the trustee and any duties of administration enduring for a substantial period of time, but rather it is a passive, temporary arrangement, in which the trustee's sole duty is to transfer the title and possession to the beneficiary.

 Such situations might involve an affirmative assertion of the truth of a material fact or concealment of the existence of a material fact when there was a duty to speak. The state of the defendant's mind is a material fact and might be a basis for a constructive trust—such as when the defendant promises to use the property for certain purposes beneficial to the plaintiff but intends at the time of the transfer to retain it for himself or herself. The defrauded party can also proceed on the theory of setting aside the transfer, which is substantially equivalent to obtaining a constructive trust, or the defrauded party can sue for damages.

The right to a constructive trust is generally an alternative remedy. The aggrieved party can choose between a trust and other relief at law, such as recovery of money wrongfully taken, but cannot obtain both types of relief.

A constructive trust, as with an express trust, must cover specific property. It cannot be predicated on mere possession of property or on a breach of contract where no ownership of property is involved.

The court decides what acts are required of the plaintiff as conditions precedent to the securing of a decree (a court order that determines the rights of all the parties to the suit). When a defendant has acquired title to property of the plaintiff by means of fraud, the plaintiff will be required to return any consideration (inducement to enter into a contract) received from the defendant. In addition, if the defendant has, during his or her period of wrongful retention of the property, spent money for the preservation or protection of the property, such as by paying taxes or the principal or interest on a mortgage, reimbursement might be required of the plaintiff.

 

If the defendant has made improvements or performed services in managing the property, some courts require the plaintiff to compensate the defendant to the extent of the benefits inuring to the plaintiff through the imposition of a constructive trust, particularly in cases in which the defendant was not an intentional wrongdoer, but rather acted under mistake or ignorance.

The decree establishing the constructive trust requires the defendant to deliver possession and convey title to the property and to pay to the plaintiff profits received or rental value during the period of wrongful holding and otherwise to adjust the equities of the parties after taking an accounting.

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Problems material to the Deed of Trust

The expert notes in testimoney as follows:

Borrower covenants to be lawfully seised of the estate hereby conveyed  . . .Historical perspective is to put in legal possession of a feudal holding; to put in legal possession of a particular thing; assign ownership to: in the passive voice: seized of the estate  ...

Borrower covenants having the right to grant and convey the Property  . . . . Under § 2805.14 BLM are rights one does grant convey; to grant conveys only those rights which it expressly contains. .. Subject to existing rights of others, including the United States. Rights which the grant conveys to you include the right to:(a) Use the described lands to construct, operate, maintain, and terminate facilities within the right-of-way for authorized purposes under the terms and conditions of the grant;(b) If your grant specifically authorizes, allow other parties to use your facility for the purposes specified in your grant and you may charge for such use. 

Borrower covenants and that the Property is unencumbered . . . familiar to a bailment arrangement, to pawn something or to induce one into exchanging consideration for  or in return for the use or right to ones property…to use as collateral.

 Borrower covenants [and the Property is unencumbered] except for encumbrances of record.  . . To warrant the property to be lien free, something of value or anything as having no liens of record or debt owed …. Such warranties in advance of the contracts enforceability are moot; if conditioned by possession or title in exchange for consideration, for possession or an executory understanding.

Conclusions

 

The vanguard to claims and for overcoming  controversy is evident in the security instrument given by a lender to obligor by its creditor. For the beneficiary is a principal debtor with understanding of trust and for tax shelter purposes. 

 

Claims in a foreclosure far exceed the civil code of procedures upon a seller grant and conveys title to the purchaser while the debtor is held to have transferred its title, alleged only in the event of a default. The transfer of title into trust from the onset is not one in the same with the granting and conveyances made incidental to trust and conditioned to a breach that cannot be anticipated certainty.

 

Questions arise as to the merit for arguing predatory lending practices and instances of unconscionable financing.

 

A practical view for the court to hearing arguments  predispose the lender to advance the least dollar amount against the highest collateral value. For a lender balance sheet is held valuable where the reader can identify a portfolio of lower loan to value origination's for the obligation of others outstanding.

 

By contrast, the high loan to value advances is indicative of a bull market sentiment and rapidly appreciating market sector. Combined Loan to value CLTV is not reported as 100% of the property value for loans outstanding.

 
The data set used herein this review focused on the sponsor registrant’s definition or a mortgage “loan with a piggyback” as a first lien loan with LTV=60 and with reported CLTV of 80. This definition serves to reduce the number of combo loans that were inherently impaired while not reducing the over-collateralized loans true exposure to loss.

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Program Description:

The expert witness services offered are from a certified program that combines the historical accounts of the witness with the advocacy of the CPA under GAAP and FASB rules.

Testimony by accounting rules is designed to build the court confidence in the abundant hearsay that make it into cout and far to many foreclosure cases.

Experts are past secondary and capital markets management, with decision-making, and analytical skills that can be applied to the current controversy facing foreclosure claims and litigants.

The program offers services for counsel comprised of seven areas of  lender liability and secondary ,markets convergences with capital markets requirements for bond offerings.

The testimony is covering variety of methods and techniques used in organizational cost analysis, budget planning, financial reporting, auditing, and business transaction analysis. Other topics addressed in the application of certain curriculum include accounting information systems, financial statement preparation, accounting principles, inventory management, assets and liabilities, investment strategies, and business tax compliance.

Clients are encouraged to interview the experts we offer and CPA review for all expert work . The merit for arguing your case will not be left o hearsay if the court is willing to accept the facts supported by tax payers obligations and calls to avoid the most cost burensome pursuits in fidngs the best tax payer solutions in this recovery

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Foreclosure fails under the IRC.

A question arises whereas MERS lacks authority to execute the notice of default and the assignment of the deed of trust, and thus each of the foreclosure documents is contended void.

The courts have acknowledged that MERS could have properly acted under the deed of trust when such action was “required” and “necessary to comply with law or custom.” However, I contend that the true holder fails to establish that these two conditions had occurred.

First, an assignment of a deed of trust is legally permissible. (CA CC § 2934) Herein the claims state assignments are customary, “Because the lien of the trust deed is merely an incident of the debt, the assignment by endorsement and delivery of the promissory note accomplishes the transfer of the security without the necessity of a formal assignment of the trust deed itself. . . . [¶] The better practice, however, is to assign the mortgage or trust deed also by a formal written document that is duly acknowledged and recorded.” (4 Miller & Starr, Cal. Real Estate (3d ed. 2003) § 10.38, fns. omitted & italics added.)

The lien of the trust deed is not merely an incident of the debt, if that debt is discharged and satisfied to accomplish the lien holders business objectives. Where the business objectives result in the legal title to the estate having been lawfully transferred, the tax payer is obligated to report such incidents and acts. 

Herein the foreclosing party is alleged to have seized the estate of title allowing for the equitable interests to transfer immediately up[on the loans origination. The mortgage is now conditioned by a sale to a fiduciary into trust under a presumed conflict of business interests.

The assignment by endorsement and delivery of the promissory note cannot accomplish the transfer of the security without the necessity of some standard of evidencing consideration for carrying cost required to establish basis in the asset. The cost for transferring a whole loan  will be recognized by a subsequent journal entry, or other charge or write down. In this matter the foreclosure fails if the charges are taken as a sale into an isolated and remote entity to hold the estates title under the dominion of a statutory trustee in a NY formed indenture.

Foreclosure fails under the IRC.

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Collection Due Process / IRM 5.1.9.3.9,

The Appeal Process - Requirement of Investigation

Did you know that a taxpayer can request a Collections Due Process or CDP hearing to verify procedures with respect to the filing of lien and notice regarding the purpose for the lien filing.You should be prepared to asked to clarify certain issues. The Appeal Process is explained under IRM 5.1.9.3.9,

A Judicial Review of Determination includes granting a taxpayer 30 days from the date of the notice of determination by the Appeals Officer to appeal. The determination must be appealed to the U. S. Tax Court. The Office of Appeals retains jurisdiction with respect to a lien determination, including subsequent hearings requested by the person who requested the original hearing on issues regarding the following:

(1) Collection actions proposed with respect to the Appeal determination, and changes in circumstances of the taxpayer that affect the Appeal determination after the person has exhausted all administrative remedies, i.e., CAP. [See IRM 5.1.9.3.12, Jurisdiction Retained by Appeals, for additional information.]

Under 5.12.1.2.4 (01-09-2009) are the requirments for Suspension of Collection Period of Limitations. As set forth , if a hearing is timely requested, the running of the period of limitation will be suspended starting on the date the hearing request is received. The suspension will end when the decision of the Appeals office becomes final, i.e., 30 days after issuance of the determination if it is not appealed to the Tax Court. If appealed to the Tax Court, the suspension ends when the decision in the case becomes final. Notwithstanding the above, the period of limitation for collection will not expire before 90 days after a determination becomes final.

As for garnishment or levy, a Levy action is not required to be suspended during a lien hearing. Levy action is, however, generally suspended pending the Appeals determination. Levy action can be taken if it is determined that collection is at risk.

 

For more information see IRM 5.1.9.3.5(5) and Treasury Reg. §301.6320-1(g).