Posted Jun 07, 2010 06:51 pm CDT
Martin Powelson paid off his delinquent Detroit mortgage. But after a law firm that handles a high-volume foreclosure practice mistakenly said told the lender that the redemption period had expired with the loan unpaid, a so-called trash-out crew paid a visit to his house.
Contending that crew removed some $60,000 in personal property, including tools, a new Jacuzzi and a $6,000 sleigh bed still in the box, the 39-year-old has sued. Among the defendants are the law firm, Trott & Trott of Farmington Hills, Mich., and his former lender, reports the Detroit Free Press.
He is seeking class action status, on the theory that he is one among a number of homeowners in such cases. The trash-out company, which is now bankrupt, has admitted that it didn’t return his property to him, and Powelson is seeking $180,000 in damages. No one has ever apologized to him, he adds.
The law firm declined to comment for the article. However, an attorney representing the firm at a recent court hearing said Trott & Trott was not at fault because the initial, mistaken, e-mail from Trott & Trott to the lender about the status of the loan had been corrected with a follow-up e-mail the next day, the newspaper reports.
“It’s like the Wild West out there,” says attorney William Yochim, who is representing Powelson.
There have been a number of apparently unrelated cases nationwide in which lenders have mistakenly sent trash-out crews to homes that hadn’t been foreclosed upon—some of which didn’t even have mortgages, according to the article. After one such incident, a Nevada family won a judgment of nearly $1 million; the crew had gone to the wrong address.
Part of the problem in such cases is that those overseeing the foreclosure are overlooking a vital step in the clean-out process—a court-ordered eviction of any existing resident after the foreclosure is complete, attorney Lawrence Shoffner tells the newspaper. “Just because you have a foreclosure and just because the redemption period has expired doesn’t mean that the lender has the right to go in and seize personal property.”
ABAJournal.com: “As Bank Takes Possession of Home, Couple Argues, to No Avail, ‘We Paid Cash,’ Suit Says”
ABAJournal.com: “Fla. AG Probes Large Foreclosure Law Firm re Possible ‘False & Misleading’ Mortgage Docs”