In re: DANIEL JOSEPH SUTTER | Bankers are tagged by court with “unclean hands” and mortgage is adjudicated “void ab initio”

Financially challenged homeowners refi a loan in Michigan; but sign while on vacation in California. You’ll have to really read the whole case. Bank Rep in California inadvertently DOES NOT get their signature on the mortgage. They DEFAULT and when the inevitable foreclosure ensues, they file Chapter 13. Bank files a proof of claim WITH a Michigan signed, notarized and recorded mortgage. Which is an impossibility as they were in California when they signed. Bankers are tagged by court with “unclean hands” and mortgage is adjudicated “void ab initio”. Then the fur really starts to fly!
















No. 10-1656

Appeal from the United States District Court

for the Eastern District of Michigan at Detroit.

No. 09-11816—Anna Diggs Taylor, District Judge.


At the April 8 closing, the Sutters signed a note payable to World Wide in the amount of $78,000. The Sutters …. apparently did not sign a mortgage instrument ….

Within a few months of the closing, the Sutters began to fall behind on their payments on the World Wide mortgage. When Appellants initiated foreclosure proceedings, the Sutters filed a Chapter 13 bankruptcy petition on November 21, 2005.

Saxon filed a proof of claim in the Sutters’ Chapter 13 case asserting a secured claim in the amount of $83,498.26, secured by the Sutter property. Attached to the proof of claim was the World Wide mortgage, notarized and ostensibly bearing the signatures of the Sutters. The certificate of acknowledgement on the World Wide mortgage states that “[t]he foregoing instrument was acknowledged before me [the notary] this April 8th, 2004, by Daniel J. Sutter and Sheryl L. Sutter, his wife” in the State of Michigan, County of Oakland. The mortgage was recorded with the Lapeer County, Michigan, Register of Deeds on May 25, 2004.

The Sutters filed an objection to the proof of claim, alleging that it should be disallowed because their signatures on the mortgage instrument were forged.

Counsel for Appellants conceded at oral argument in this appeal that the mortgage was forged, and Appellants also noted that a claim has been filed against the bond of the notary who attested to the alleged signatures of the Sutters. Accordingly, the district court’s factual finding that the World Wide mortgage was forged is not clearly erroneous.

At the heart of this argument is the concern, expressed by the bankruptcy court at the April 2007 hearing, that the Sutters will receive a windfall in the form of a “free house,” particularly as it is undisputed that the Sutters intended to grant a mortgage interest to World Wide.

Copy of the decision below…




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8 Responses to “In re: DANIEL JOSEPH SUTTER | Bankers are tagged by court with “unclean hands” and mortgage is adjudicated “void ab initio””
  1. Here’s email it is three years later. We have secured new legal representation and have since discovered fraud with the rest of the documentation as well…in fact…”their” note happens to be a copy of our duplicate note with endorsements…and the note that they tried to pass off as the “blue ink” note has failed miserably seeing we signed in black ink, as demonstrated by the rest of our duplicate packet…which, by the way, are the same documents the bank has tried to make thier own…only problem…we hold the original duplicates….Eleven years and they have never had standing…ever….shame on them…

  2. As the plaintiffs in this case I can honestly say it’s been a long road. It took us six years to get to this point…with the bank treating us like we were the criminals the whole way. We accept the fact that due to the economy and our own financial situation, we most likely would have lost our home. It is not our fault that the banks took it upon themselves to sign our names to the mortgage document. It was in our right for public trust that this should have never occurred. I am glad that the courts (and I don’t mean the bankruptcy court, which in my opinion, are pro-creditor even when the creditor is the criminal) saw through their smoke screen and did what was correct in this case,

  3. lvent says:


  4. lvent says:

    Everyone should Google and read Adam Levitin’s Congressional Written Report Regarding Securitization And Foreclosure Of November 18, 2010. In it he explains the crimes of the banks to Congress in simple terms that most could understand. Mr. Levitin also explains that most homeowners do not have attorneys to rep them in court and that is not the homeowner in most cases who are deadbeats but the servicers who are at fault.. Mr. Levitin stated that there could very well be a large systemic risk to the largest banks something along the lines of 2008 and that the review on compliance by the banks and fraud in the foreclosures needs to be conducted by Federal Regulators. Mr. Levitin stated is not within the ability of the Federal Reserve or the Banking Regulators to review this risk…
    Mr. Levin also used CEO of JP MORGAN CHASE, JAMIE DIMON’S remark that “for the most part, by the time you get to the end of the process wer’re not evicting people who deserve to stay in their house.” and that Mr. Dimon’s logic condones vigilante foreclosures: so long as the debtor is delinquent, it does not matter who evicts them or how. (And it doesn’t matter if there are some innocents who lose their homes in wrongful foreclosure as long as “for the most part” the borrowers are in default.) But Mr Levitin argues, BUT THAT IS NOT HOW THE LEGAL SYSTEM WORKS…ANY OLD STRANGER CANNOT TAKE THE LAW INTO HIS OWN HANDS AND KICK SOMEONE OUT OF THEIR HOME..THAT RIGHT IS RESERVED SOLELY FOR THE MORTGAGEE…Mr. Levitin said that ultimately, the “No Harm, No Foul.” argument is a claim that rule of law should yield to bank’s convenience and to argue that problems in the foreclosure process are irrelevant because the homeowner owes someone a debt is to declare that the banks are above the law….
    Thank you Mr. Levitin…and Jamie Dimon…shouldn’t you be in prison by now?

    • lvent says:

      FOX Business reporting that Bernanke blaming the housing market again for the slow economic recovery…Maybe it is time the Fed stopped bankrupting the people by feeding the Banks and maybe it is about time that the Federal Regulators audited the BANKS and then shut them down because they are insolvent…..! Problem solved!!!

  5. Pamela Edwards says:

    Unclean hands well thats fairly mild compared to what I would say.

  6. Beth A. says:

    Yeah – judges who get it are our only chance.

    Thank you so much for posting this as portions of this are relevant in our situation!!

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