M brought an Order to Show Cause alleging a fraudulent mortgage rescue scheme surrounding the conveyance of her property to Defendant in August 2005. M sought to destroy the $470,000 mortgage given by F to Option One, now held by Deutsche Bank.
M was having financial difficulties and claimed that an individual called PM approached her with a mortgage rescue plan. M was responsible for involving his friend F in the deal, going as far as to fly F back to the States first class from Trinidad for the closing.
The property was deeded from M and her husband to F. An existing mortgage of approximately $370,000 given by M was paid by Option One at the closing. F claimed he met M for the first time on the day of the closing. M also claimed the existence of a verbal agreement at this closing that provided her with a right of first refusal to re-purchase the property in a year.
M defaulted in the foreclosure action and thereafter sought to vacate her default, claiming a failure on the part of Deutsche Bank to serve her with the foreclosure complaint and fraud in the underlying action by F and the bank. In the Order to Show Cause, M claimed that there was $128,000 unaccounted for. She also sought, once intervention was granted, to vacate the deed given by her to F and to destroy the mortgage given to our insured by F.
Adam Leitman Bailey, P.C. collected the land transaction documents from the appropriate clerks’ offices on Staten Island. This provided us with documentation that, contrary to M’s claim that she was an innocent owner, she had, in fact re-financed the subject property four (4) times in two (2) years. She was also on the verge of losing the property in a foreclosure proceeding brought by another lending institution. Adam Leitman Bailey, P.C. also contacted the attorney who represented the bank on the subject closing and began to piece together, the flow of money at the subject property. Adam Leitman Bailey, P.C. was able to account for approximately 99% of the claimed missing funds at closing. Once we completed our investigation and analysis of documents obtained from the Clerks offices and from the bank attorney on the closing, we prepared opposition papers to the M order to show cause and cross moved to win the entire case.
Adam Leitman Bailey, P.C. was victorious in the matter and the entire case. The court denied the application of M in its entirety and allowing Adam Leitman Bailey, P.C. to prevail on behalf of its clients in total. The Court found that M’s mere denial of service of the foreclosure complaint was insufficient to vacate her default. Additionally, the Court specifically found that the documentation uncovered during this firm’s investigation into this matter rebutted M’s “claim of fraud”. Thus, a meritorious defense of fraud had not been demonstrated by M. This victorious decision allowed Adam Leitman Bailey, P.C. to foreclose on the property.
Adam Leitman Bailey, and Peter J. Reid represented the client in this matter.