Emergency hearing for temporary restraining order/declaratory relief to stop Lanier from proceeding with a dispossessory hearing set on February 4, 2021 in Magistrate Court. And to set aside Bank’s wrongful foreclosure. And to determine the rights of the parties. Because this is about land title, the Superior Court has total jurisdiction. O.C.G.A. § 15-6-8
On the Undelivered Promissory Note, under Late Charge, it says “If my payment is more than 10 days late, I will be charged 7.500% of the regularly scheduled payment, regardless of any partial payments Lender has received.” It is undisputed that this clause violates GA. Code § 7-6A-3 (3) Limitations of home loans (Georgia Code (2020 Edition)) which says “No creditor or servicer may charge a borrower a late payment charge unless the loan documents specifically authorize the charge, the charge is not imposed unless the payment is past due for ten days or more, and the charge does not exceed 5 percent of the amount of the late payment.” On January 5, 2021 Queensborough National Bank & Trust Co. (Bank) foreclosed Cerbone’s house under Power of Sale on January 5, 2021 with a claimed default on loan number 001148521001 for property address 215 E. 48th Street, Savannah, Georgia 31405 in Chatham County. Bank sold Cerbone’ home to Lanier Management (Lanier) for $332,415. Cerbone wants his home back, among other things. Cerbone has a legal right to seek temporary and permanent injunctive relief because he lives in the house with his three dogs. Cerbone has no adequate remedy at law to redress the harm. On January 23, 2017 Cerbone bought the home for $350,000. He put down $35,000. Bank made a loan to him for $315,000. Cerbone then put over $100,000 of his own money into updating the house. In 2018 Cerbone had the property appraised for $405,000. Since then, Cerbone built a 1500 gallon pond and waterfall with rocks and boulders, replaced the front and back yards with Zoysia grass, and built a six foot cedar wood picket fence painted white with two locking security gates to contain his three Dogo Argentino’s: Hova, Alma, and Morocho De La Cocha. At this point I don’t know what any of the parties will stipulate to. So I better wait for the hearing.
State any and all special authorities you rely upon to peculiar evidentiary or other legal questions.
An undelivered deed or note is invalid and cannot be enforced by foreclosure or power of sale. Jones v. Phillips, 488 SE2d 692, 227 Ga.App. 94 (1997); Jones v. Phillips, 513 S.E.2d 241, 237 Ga.App. 24 (1999) In Jones, the issuance or delivery of the note is a prerequisite to its enforceability. The court held that the creditor could not sue to collect on a note which was not delivered to it. The court found collection was improper, even though the maker of the note testified that she had signed the note and intended to repay it.
A foreclosure sale shall not stand where the the law or the mortgage have been disobeyed, and injured the mortgagor. Coates v. Jones, 142 Ga. 237, 82 S.E. 649 (1914) (sheriff’s sale); Plainville Brick Co. v. Williams, 170 Ga. 75, 152 S.E. 85 (1930) (sale under power).
Where the holder of a security deed is conducting a foreclosure in disregard of the requirements of law or those of the instrument itself, and his noncompliance is prejudicial to the grantor, a sale so conducted may be restrained or set aside in equity. Curl v. First Federal Sav. & Loan Ass’n of Gainesville, 243 Ga. 842, 257 S.E.2d 264 (1979)
GA. Code § 7-6A-3 (3) Limitations of home loans (Georgia Code (2020 Edition)) No creditor or servicer may charge a borrower a late payment charge unless the loan documents specifically authorize the charge, the charge is not imposed unless the payment is past due for ten days or more, and the charge does not exceed 5 percent of the amount of the late payment.
Foreclosure was enjoined where a court held that there was a question of fact concerning the construction of a forbearance agreement and the course of conduct of the lender, both of which, if proved, could constitute a waiver of strict performance of the deed to secure debt. Atlanta Dwellings, Inc. v. Wright, 272 Ga. 231, 527 S.E.2d 854 (2000).
The notice must be reasonable and the debtor must be given a reasonable opportunity to cure previously tolerated deviations from strict compliance. Verner v. McLarty, 213 Ga. 472, 99 S.E.2d 890 (1957).
A debtor’s payment or tender of the principal and interest due on the loan is a prerequisite to a claim to set aside a foreclosure sale. Ceasar v. Wells Fargo Bank, N.A., 322 Ga. App. 529, 744 S.E.2d 369 (2013). However, the law will not require a useless formality, and where the creditor indicates that he will not accept the sum offered, the debtor is relieved from the duty of tendering it. And there is authority that where a creditor is proceeding in violation of law he should not be allowed to demand that his victim “do equity” before receiving the protection to which he is entitled.
Consumer Financial Protection Bureau (CFPB) created the Closing Disclosure form. It discloses to the consumer all costs associated with the mortgage loan, including all closing costs. The Closing Disclosure must be provided to the consumer three business days before the closing of the loan.
Acceleration clause is a “default charge” which must be disclosed by the federal Truth in Lending Act, even though Georgia law prevents the creditor from using the provision to charge any unearned fee or interest. Thomas v. Universal Guardian Corp., 144 Ga. App. 869, 243 S.E.2d 101 (1978). Acceleration clause not disclosed rendered contract void. Frazier v. Courtesy Finance Co., 132 Ga. App. 365, 208 S.E.2d 175 (1974).
Misrepresentation of a material fact, made willfully to deceive or recklessly without knowledge and acted on by the opposite party or made innocently and mistakenly and acted on by the opposite party, constitutes legal fraud. O.C.G.A. § 23-2-52;
There was some evidence that bank officers misrepresented to a borrower the terms of written loan documents signed by the borrower. Bassett v. Jasper Banking Co., 278 Ga. App. 698, 629 S.E.2d 434 (2006).
Fraud will authorize equity to annul conveyances O.C.G.A. § 23-2-60;
Slight circumstances may prove fraud. O.C.G.A. § 23-2-57;
Fraud may be signs or tricks, or through agents employed to deceive, or by any other unfair way used to cheat another. O.C.G.A. § 23-2-56
Cancellation of foreclosure and damages may be both awarded to the injured borrower in the same action, including attorney fees and resulting financial difficulties. Hall v. Robinson, 165 Ga. App. 410 (1983)
Equity may rescind or cancel a contract for mistake of fact by one party only, even though the other party may not be at fault. O.C.G.A. § 23-2-31.
Nondelivery of the contract may be shown by parol to invalidate it, as in the case of the nondelivery of a deed. Wendlinger v. Smith, 75 Va. 309, 1881 WL 6338 (1881); Whitaker & Fowle v. Lane, 128 Va. 317, 104 S.E. 252, 11 A.L.R. 1157 (1920).
Respectfully submitted on February 3, 2021,
Jason P. Cerbone
Pre-Hearing Report Exhibit List
- Zillow Photo of house
- Crash picture of Cebone’s Jaguar F-Pace
- Closing Disclosure #1 1/18/17
- Closing Disclosure #2 faxed 1/18/17
- Closing Disclosure #3 1/23/17
- Closing Disclosure #4 1/23/17
- Closing Disclosure #5 4/19/17
- Letter from Bank (sent with Closing Disclosure #5) 4/21/17
- Email from Cerbone to Joel Gerber re: wrong closing disclosures
- Billing notice 3/8/17
- Letter from Bank’s lawyer to collect $13,543.15 7/21/2020
- Reinstatement option from Bank to Daniel Jenkins (lawyer I talked to) to collect $18,916.07 on 8/4/20
- Billing notice dated 8/9/20 for $21,624.70
- Billing notice dated 12/8/19 showing total due $6,685.46
- Periodic Arm Disclosure dated 12/9/19 raising payment to $2916.58 (1st notice received about rate change)
- Billing notice dated 1/8/20 total due: $9,614.49
- Reminder notice dated 1/22/20 total due $4,165.13
- Letter from Allstate saying I will not receive future bills
- Letter from Geico saying Bank never paid them so they are cancelling home insurance policy that I enrolled with to get car insurance
- Letter from Cerbone to Bank on 11/5/20 asking for payoff amount
- Letter from Bank’s lawyers McKorkle, Johnson, & McCoy on 11/10/20 demanding $329,476.52 and telling me to “govern yourself accordingly.”
- Email from J. Michael English to me on 12/10/20
- Email from Ryan Murphy (friend) with Forbearance agreement attached on 12/31/20
- Forbearance Agreement
- Letter from Cerbone sent 12/31/20 telling Bank I will pay them and $35,000 is in Josh Walker’s trust account to pay bank. (The money is still in Walker’s trust account.
- Text from Robert McKorkle to Josh Walker saying I could pay bank to stop foreclosure (I received this after Bank foreclosed
- Letter from Lanier on 1/6/21 seeking immediate possession
- Dispossessory Warrant filed on 1/7/21 from Lanier
- Tenth Order Extending Declaration of Statewide Judicial Emergency from Supreme Court on 1/8/21
- Appraisal of my house in 2018 for $405,000
- Photo of my house
- Photo of my house
If the parties have mutually departed from strict compliance with the terms of the note or security deed (e.g., regular acceptance of late payments for a number of months), the lender cannot declare a default for that particular deviation without first giving the borrower notice that strict adherence to the terms of the contract is now required. O.C.G.A. §13-4-4 (Ga. Code Ann. §20-116).
Prayer for Equitable Relief
Cerbone prays to this Court to grant the following equitable relief:
- Grant an Emergency Temporary Restraining Order against Lanier stopping Lanier from dispossessing and evicting Cerbone, and restraining them from selling or doing anything with Cerbone’s Home;
- Order an Emergency Interlocutory Injunction Hearing against Bank to set aside the Foreclosure sale;
- Order a Permanent Injunction setting aside sale to Lanier;
- Grant Money damages against Bank for wrongful foreclosure;
- Order Bank to remove all negative information from all consumer reporting agencies;
- Grant whatever other equitable relief this Court feels necessary.
Respectfully submitted on February 3, 2021
Jason P. Cerbone