Robo-Signing Allegations Must Be Timely Raised in Foreclosure Case or They’re Waived

Robo-signingLast summer, in GMAC v. Coleff, the Eight District Court of Appeals decided another case involving robo-signing claims made by the borrower. Apart from providing a well written summary of the necessary elements of a Rule 60(B) motion, the decision reaffirms the proposition that claims suggesting that a lender relied on fabricated evidence to establish standing must be raised as a defense to the underlying foreclosure, and not in a Rule 60(B)(3) motion.

GMAC Mortgage, L.L.C. v. Coleff, involved a borrower who fell behind on her mortgage, which in turn caused GMAC initiate foreclosure proceedings. In the complaint, GMAC alleged that it was the holder of the note and the assignee of the mortgage. GMAC supported these allegations with copies of the fully endorsed note and the recorded assignment, which were attached to the complaint.

The borrower was served with the complaint, but she failed to answer, and GMAC moved for and was granted judgment by default. Four days before the scheduled sheriff’s sale, the borrower appeared in the case and moved for relief from judgment under Civil Rule 60(B). The trial court denied her motion and she appealed.

The Eight District rejected the borrower’s arguments and affirmed the trial court’s denial of her motion for relief. As an initial matter, the Eight District found that the endorsed note and assignment of mortgage attached to the complaint were sufficient to establish that GMAC had standing to foreclose. Moreover, to the extent that the borrower alleged that the evidence that GMAC used to establish standing, and otherwise prove its case, was fraudulent, her argument should have been presented as a defense in the underlying foreclosure case, not in a Civil Rule 60(B)(3) motion for relief from judgment.

The decision, although unremarkable at this point in time, deserves a quick read, and should serve as support for anyone opposing an untimely motion to vacate based on robo-signing allegations.

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