Case could affect future of foreclosures

Kendall Coffey

Even though the lawsuit is already settled, Roman Pino v. Bank of New York Mellon could affect how foreclosures are filed across the entire United States. 

Right now, banks aren’t precisely as careful about the foreclosures they file because they don’t have to be.  If something ever goes wrong, say- if they filed the foreclosure with fraudulent documents- all they have to do is dismiss the mortgage and re-file correctly. 

In case you thought that fraudulent documents reference was an excessive one, the very lawsuit at hand deals with that issue.  Roman Pino’s mortgage assignment, the legal document that binds a loan to a lender, had been signed by a low-wage worker hired to simply sign the document without the due diligence of checking the document for accuracy- as is usually required.

Pino owns his house now, as the case was settled out of court, but the Florida Supreme Court is still hearing the case.  Many foreclosures in Florida have had similar fraudulent paperwork, and the voluntary dismissal strategy might be at fault.   Essentially, there is little incentive not to lie. 

As Amanda Lundergan, an associate with the law firm that represented Pino, explained, “It sets up a system where every litigant is condoned and encouraged to lie, cheat and steal, knowing that if they are caught, they can simply voluntarily dismiss and absolve themselves from that fraud."

There could be wide backlash if the court rules against voluntary dismissal.  There were more than 104,000 cases voluntarily dismissed from Florida’s courts last year.  In fact, if the court rules against the banks, "a broad universe of mortgages could be rendered unenforceable," said former U.S. Attorney Kendall Coffey, author of the book, "Foreclosures in Florida."