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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 COMES NOW Defendant, Metropolitan Mortgage Group, Inc., by and through their 17 attorneys of record and answers Plaintiffs Complaint for Temporary and Permanent 18 Restraining Order; Infliction of Emotional Distress; Breach of Fiduciary or Quasi-Fiduciary 19 Duty; Violations of the Consumer Protection Act; Violations of the Truth in Lending Act, 15 20 U.S.C. 1601, et. seq. as follows: 21 /// 22 /// 23 /// 24 /// 25
DEFENDANT METROPOLITAN MORTGAGE GROUP, INC.S ANSWER TO COMPLAINT OF KRISTIN BAIN - 1
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Hon. John C. Coughenour

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE KRISTIN BAIN, Plaintiff, vs. METROPOLITAN MORTGAGE GROUP, INC.; INDYMAC BANK, FSB; MORTGAGE ELECTRONIC REGISTRATION SYSTEMS; REGIONAL TRUSTEE SERVICE; FIDELITY NATIONAL TITLE; and Doe Defendants 1 through 20, inclusive, Defendants. No. 09-00149-JCC DEFENDANT METROPOLITAN MORTGAGE GROUP, INC.S ANSWER TO COMPLAINT OF KRISTIN BAIN

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 1.4 1.3 1.2 1.1

I. PARTIES Plaintiff, Kristin Bain, who is a resident of King County, Washington, and

pleads the following allegations, states that those allegations are true of her own knowledge, except as to matters stated on information and belief, and as to those matters, she believes them to be true. This defendant admits that Kristin Bain resides in King County. Otherwise this defendant denies the allegations in Section 1.1.

Defendant Metropolitan Mortgage Group, Inc. (Metropolitan) is a Washington

entity which is licensed by the Washington Department of Financial Institutions, but it is not registered with the Washington Secretary of State. Further, Defendant Metropolitan conducts business in the State of Washington by providing Washington state residents with residential mortgage brokering services. The Defendant Metropolitan Mortgage Group, Inc. admits that it is a licensed mortgage broker holding license number 510-MB-24707 and is properly licensed and bonded and authorized to conduct mortgage business in the State of Washington. Otherwise, the Defendant denies the allegations contained in Section 1.2 of the Plaintiffs Complaint.

Defendant IndyMac, FSB (IndyMac) is a federally chartered savings bank

which does business in the State of Washington by making mortgage loans which are secured by real property located in the State of Washington. Admit.

Defendant Mortgage Electronic Registration Systems (MERS) is a corporation

located in Virginia which is NOT registered and licensed to conduct business in the State of
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1 Washington. Nevertheless, MERS conducts business in the State of Washington by purporting 2 to obtain a beneficiary interest in Deed of Trust which constitute liens on real property located 3 in Washington. 4 This answering defendant has insufficient information to either admit or deny the 5 allegations contained in Paragraph 1.4, and therefore denies the same. 6 7 1.5 8 entity which is not registered to do business in the State of Washington. It appears that 9 Defendant Fidelity is involved in this transaction by acting as an agent for Defendants IndyMac 10 and/or MERS. 11 This answering defendant has insufficient information to either admit or deny the 12 allegations contained in Paragraph 1.5, and therefore denies the same. 13 14 1.6 15 Washington corporation which conducts business in the State of Washington by acting as a 16 trustee for beneficiaries under Deeds of Trust recorded in the records of counties in the State of 17 Washington. Defendant Regional Trustee is representing that it has the authority to conduct a 18 foreclosure sale on behalf of IndyMac and MERS and to transfer title to Ms. Bainss home 19 based upon terms in the Deed of Trust. 20 This answering defendant has insufficient information to either admit or deny the 21 allegations contained in Paragraph 1.6, and therefore denies the same. 22 23 1.7 24 individual, corporate, partnership, associate or otherwise, are presently unknown to Plaintiff, 25
DEFENDANT METROPOLITAN MORTGAGE GROUP, INC.S ANSWER TO COMPLAINT OF KRISTIN BAIN - 3
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Defendant Fidelity National Title (Fidelity) is an unknown type of business

Defendant Regional Trustee Service Corporation (Regional Trustee) is a

The true names and capacities of Does 1 through 20, inclusive, whether

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1 who therefore sues said Defendants by such fictitious names. Plaintiff alleges, based upon 2 information and belief, that each Defendant is responsible in some manner for the events 3 described herein and is liable to Plaintiff for the damages he has incurred. Plaintiff will amend 4 this Complaint to show the true names and capacities of the Doe Defendants when the same 5 have been ascertained. 6 Denied. 7 8 1.8 9 agents, servants, representatives and/or employees of each of the remaining Defendants and 10 were acting within the course and scope of such agency or employment. The exact terms and 11 conditions of the agency, representation or employment relationships are presently unknown to 12 Plaintiff, but when the information is ascertained, leave of court will be sought to insert the 13 appropriate allegations. 14 Denied. 15 16 17 2.1 18 Paragraph I above. 19 This answering defendant re-alleges and incorporates its answers as set forth in 20 Paragraph I above. 21 22 2.2 23 difficulty understanding documents, especially voluminous documents such as mortgage loan 24 documents. Ms. Bain is able to live independently, but she also receives significant assistance 25
DEFENDANT METROPOLITAN MORTGAGE GROUP, INC.S ANSWER TO COMPLAINT OF KRISTIN BAIN - 4
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At all times mentioned herein, the Defendants, and each of them, were the

II. FACTUAL ALLEGATIONS Plaintiff re-alleges and incorporates by reference the allegations set forth in

Plaintiff Kristin Bain is a young woman who has severe ADD, which involves

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1 from her parents. Ms. Bain works, but she also has access to some trust funds for specific 2 purposes. In late 2006 and early 2007, Ms. Bain was interested in purchasing a home of her 3 own and sought assistance from a realtor for that purpose. Ms. Bain became interested in a 4 property located in Everett and made an offer on the house. Ms. Bain was referred to mortgage 5 broker, Defendant Metropolitan, by her realtor. Ms. Bain was working with a loan originator 6 named Korey Pisha. 7 Denied. 8 9 2.3 10 to him about her special needs and to indicate that she would have difficulty understanding loan 11 documents herself. Christine provided Mr. Pisha with her telephone number and that of Ms. 12 Bains father so that they could assist in the process and one of them could accompany her to 13 the loan signing. Christine also advised Mr. Pisha that Ms. Bain could not afford more than 14 $1,200.00 per month for a mortgage payment and that if money was needed from her trust 15 account to help with a down payment that would assure an affordable monthly payment, Mr. 16 Pisha should contact Christine at least 10 days in advance to make those arrangements. Mr. 17 Pisha told Christine that he would contact her when the loan documents were ready for signing 18 so that a family member could accompany Ms. Bain. Mr. Pisha never made that call and did 19 not advise that Ms. Bain was going to sign the loan documents. 20 Denied. 21 22 2.4 23 early in March 2007. Ms. Bain did not receive the initial disclosures which she was suppose to 24 receive from Defendant Metropolitan when she made application for the loan, nor did she 25
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Ms. Bains mother, Christine, called Mr. Pisha in early February 2007 to explain

Ms. Bain went to the loan signing offices of the escrow agent unaccompanied

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1 receive an initial Good Faith Estimate (GFE) and other disclosure documents required by the 2 Truth in Lending Act, 15 U.S.C. 1601 et. seq. (TILA). Ms. Bain did not receive these 3 disclosures either from Defendant IndyMac. Therefore, Ms. Bain did not have any idea what 4 the terms of the loan was when she went to the signing. Ms. Bain did not have any idea what 5 the terms of the loan was when she went to the signing. Ms. Bain did receive copies of the loan 6 documents at the loan signing, but she did not realize that her mortgage payments would be 7 more than $1,700.00 per month! Ms. Bains loan application contained completely false 8 information regarding her monthly income. 9 representative for Cingular, which is not a high paying job. Nevertheless, Mr. Pisha reported 10 her monthly income on the loan application as $3,200.00 per month! Further, there was 11 information on the loan application regarding Ms. Bains trust fund and the form indicates that 12 she receives month income from the trust fund. This is not true as Ms. Bain does not receive 13 monthly income. Notably, of course, Ms. Bain was not provided with the opportunity to pay 14 down the price of the condominium nor to decrease the costs of or interest rate on the loan with 15 withdrawing funds from the trust fund even after her parents request to Mr. Pisha as a 16 representative of Defendant Metropolitan. 17 Denied. 18 19 2.5 20 condominium because they exceeded her ability to pay. Finally in 2008, the payments became 21 too much for Ms. Bain and she received a Notice of Default. When Ms. Bain could not cure 22 the default on the mortgage, she received a Notice of Trustees Sale from Defendant Regional 23 Trustee indicating that the foreclosure sale of her home was scheduled for December 26, 2008. 24 Denied. 25
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Ms. Bain works as a customer service

Ms. Bain has struggled to make the mortgage payments since she purchased the

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1 2 2.6 3 Deed of Trust on the first mortgage loan on behalf of the beneficiary. Even though the loan 4 was actually made by Defendant IndyMac, it apparently is taking the position that Defendant 5 MERS was the original beneficiary, which is a completely false assertion. Defendant MERS 6 never had any beneficial interest in Ms. Bains loan. Nevertheless, a person named Bethany 7 Hood signed an Assignment of Deed of Trust document as an alleged Vice President of 8 Defendant MERS as nominee for its successors and assigns. Ms. Hood signed the document 9 in Dakota County, Minnesota, even though neither Defendant MERS nor Defendant IndyMac 10 is located or has offices in Minnesota. In fact, the document itself indicates that once it is 11 recorded, it is to be returned to Defendant IndyMac in Austin, Texas. This Assignment asserts 12 that Defendant MERS is assigning Ms. Bains loan to Defendant IndyMac the original 13 lender! Further, the Assignment was allegedly signed on September 3, 2008. The Assignment 14 was recorded in the records of King County, Washington on September 9, 2008 at 13:51 under 15 Document Number 20080909001149. In spite of the fact that the purported Assignment did 16 not occur until at least September 9, 2008, a Christina Allen, an alleged Assistant Vice 17 President of Defendant IndyMac signed an Appointment of Successor Trustee document on 18 August 26, 2008, also in Dakota County, Minnesota, purporting to appointment Defendant 19 Regional Trustee as the trustee under the Deed of Trust. Next to Ms. Allens signature dated 20 August 26, 2008, there is a handwritten notation that the Appointment is effective 9/3/08; 21 however, the Appointment document was not recorded until September 9, 2008 at 13:51 under 22 Document Number 20080909001150 the next recording number after the Assignment. 23 Therefore, Defendant IndyMac pre-signed the Appointment document before it allegedly 24 acquired its interest in the Deed of Trust. 25
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The NOTS indicates that Defendant Regional Trustee is foreclosing under the

In addition, Ms. Hood asserts, based upon

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1 information and belief, that Ms. Hood is not a Vice President of Defendant MERS and Ms. 2 Allen is not an Assistant Vice President to Defendant IndyMac. In fact, Ms. Hood and Ms. 3 Allen are not employees of either company but rather employees of Defendant Fidelity 4 National Title who are actively participating in fraudulently executing documents in connection 5 with this foreclosure sale by making false representations regarding their authority to appoint 6 Defendant Regional Trustee as the foreclosing trustee, there is a question about whether it had 7 the authority to sign the NOTS and note the foreclosure sale. 8 This answering defendant has insufficient information to either admit or deny the 9 allegations contained in Paragraph 2.6, and therefore denies the same. 10 11 2.7 12 to take place on December 26, 2008 should be temporarily restrained and eventually enjoined 13 until such time as this court makes a determination as to the propriety or impropriety of the 14 foreclosure sale process. 15 Denied. It does not appear that the plaintiff complied with the exclusive remedies to 16 enjoin a non-judicial foreclosure as required by RCW 61.24.130 in that the plaintiff has failed 17 to make payments as required by RCW 61.24.130(1) and in the absence thereof no injunction 18 or relief is possible. 19 20 21 22 23 24 25
DEFENDANT METROPOLITAN MORTGAGE GROUP, INC.S ANSWER TO COMPLAINT OF KRISTIN BAIN - 8
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For all of these reasons, Ms. Bain maintains that the foreclosure sale scheduled

III. CAUSES OF ACTION First Cause of Action For Temporary Restraining Order and Preliminary Injunction As Against Defendants Regional Trustee and IndyMac

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1 3.1 2 and every allegation and statement contained in Paragraphs 1 through 2.7, inclusive, of the 3 factual allegations. 4 The allegations contained in Paragraphs 3.1 through 3.4 of this complaint do not appear 5 to apply to the Defendant Metropolitan Mortgage. To the extent that they apply, they are 6 denied. 7 8 3.2 9 temporary restraining order and a preliminary injunction in order to stop the foreclosure sale. 10 11 12 3.3 13 legal or equitable right; (2) that she has a well-grounded fear of immediate invasion of that 14 right, and (3) that the acts complained of are either resulting in or will result in actual and 15 substantial injury to her. Kucera v. State, Dept. of Transportation, 140 Wn.2d 200, 209, 995 16 P.2d 63 (2000). Such criteria is evaluated by balancing the relative interests of the parties, and 17 if appropriate, the interests of the public. Id. Ultimately, the decision to grant a preliminary 18 injunction is within the sound discretion of the trial court, with such discretion to be exercised 19 according to the circumstances of each particular case. Washington Fedn of State Employees 20 v. State, 99 Wn.2d 878, 887 (1983) (citations omitted). 21 22 23 24 25
DEFENDANT METROPOLITAN MORTGAGE GROUP, INC.S ANSWER TO COMPLAINT OF KRISTIN BAIN - 9
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Plaintiff incorporates herein by reference as though fully set forth at length each

By way of the filing of a separate motion, Plaintiff will move for issuance of a

In order to obtain an injunction, a plaintiff must show that: (1) she has a clear

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1 3.4 2 the sale or risk the possibility of waiving all claims against the foreclosing entities and/or in 3 relation to the making of the loan. 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
DEFENDANT METROPOLITAN MORTGAGE GROUP, INC.S ANSWER TO COMPLAINT OF KRISTIN BAIN - 10
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In addition, under the DTA, a borrower must seek to obtain an order restraining

Second Cause of Action Infliction of Emotional Distress As Against All Defendants 3.5 Plaintiff incorporates here by reference, as though fully set forth at length, each

and every allegation and statement contained in Paragraphs 1 through 2.7, inclusive, of the Factual Allegations above, and Paragraphs 3.1 through 3.4, inclusive of the Causes of Action above. This answering Defendant incorporates here by reference, as though fully set forth at length, each and every answer in Paragraphs I through 3.4 inclusive.

3.6

By their conduct described in this Complaint, all of the Defendants have

committed the tort of intentional infliction of emotional distress. Denied. Third Cause of Action Breach of Fiduciary or Quasi-Fiduciary Duty As Against Defendants IndyMac, MERS and Regional Trustee

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1 3.7 2 and every allegation and statement contained in Paragraphs 1 through 2.7, inclusive, of the 3 Factual Allegations, and Paragraphs 3.1 through 306, inclusive of the Causes of Action above. 4 The allegations contained in Paragraphs 3.7 through 3.9 of this complaint do not appear 5 to apply to the Defendant Metropolitan Mortgage. To the extent that they apply, they are 6 denied. 7 8 9 3.8 10 or quasi-fiduciary duty to Plaintiff, including but not limited to, acting in Plaintiffs best 11 interests, and providing him with fair and honest disclosure of all facts that might be presumed 12 to influence him in regard to his actions, including those facts favorable to a creditor and 13 adverse to Plaintiffs interest as it relates to the mortgage loan described herein. 14 15 16 3.9 17 DTA and it has violated its duties under the DTA by failing to conduct its business as required 18 under the DTA and by falsely representing that it is the trustee under Ms. Bains Deed of Trust 19 when it has never been properly appointed as such. 20 21 22 23 24 25
DEFENDANT METROPOLITAN MORTGAGE GROUP, INC.S ANSWER TO COMPLAINT OF KRISTIN BAIN - 11
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Plaintiff incorporates herein by reference, as though fully set forth at length each

Defendants IndyMac, MERS and Fidelity National Title owed a fiduciary duty

Defendant Regional Trustee has a fiduciary duty as an alleged trustee under the

Fourth Cause of Action Violations of the Consumer Protection Act Based Upon Violations of the Mortgage Broker Practices Act As Against Defendant Metropolitan Mortgage

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1 3.10 2 each and every allegation and statement contained in Paragraphs 1 through 2.7, inclusive, of the 3 Factual Allegations above, and Paragraphs 3.1 through 3.9 inclusive, of the Causes of Action 4 above. 5 This answering defendant incorporates herein by reference, as though fully set forth at 6 length, each and every answer contained in Paragraphs I through 3.9 above. 7 8 3.11 9 Mortgage Broker Practices Act, RCW 19.146 et. seq. When brokering Ms. Bains loan, 10 Defendant Metropolitan did not comply with the following requirements of RCW 19.146.0201 11 (the specific acts or inactions by the Defendant is more particularly described above in the 12 Factual Allegations portions of the Complaint): Defendant Metropolitan employed a scheme or 13 artifice to defraud or mislead Plaintiff; Defendant Metropolitan engaged in unfair and deceptive 14 practices toward Plaintiff; Defendant Metropolitan obtained property be fraud or 15 misrepresentation; Defendant Metropolitan failed to make disclosures to Plaintiff as required 16 by RCW 19.146.030 and any other applicable state or federal law; Defendant Metropolitan 17 failed to comply with numerous requirements of the TILA, 15 U.S.C. 1601 et. seq., and/or the 18 Real Estate Settlement Procedures Act 12 U.S.C. 2601 et. seq.; and Defendant Metropolitan 19 is liable for these violations of the Mortgage Broker Practices Act as they constitute per se 20 violations of the Consumer Protection Act. 21 Denied. 22 23 24 25
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Plaintiff incorporates herein by reference, as though fully set forth at length,

Defendant Metropolitan is required to comply with all of the requirements of the

Fifth Cause of Action Violations of the Truth in Lending Act Against Defendant IndyMac

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1 3.12 2 each and every allegation and statement contained in Paragraphs 1 through 2.7, inclusive, of the 3 Factual Allegations above, and Paragraphs 3.1 through 3.11 inclusive, of the Causes of Action 4 above. 5 This answering defendant incorporates herein by reference, as though fully set forth at 6 length, each and every answer contained in Paragraphs I through 3.11 above. 7 8 9 3.13 10 Truth in Lending Disclosure document three days after Plaintiff submitted a loan application, as 11 required by law under the Truth-in-Lending Act, 15 U.S.C. 1601 et. seq. In addition, 12 Defendant IndyMac never provided Plaintiff with an amended Good Faith Estimate as required 13 by Law if and when certain terms of the disguised loan changed. 14 Denied. 15 16 17 and as affirmative defenses, this answering Defendant asserts the following affirmative 18 defenses in good faith, with specific reservations of rights to amend, to strike, or withdraw 19 these affirmative defenses in accordance with the evidence: 20 1. 21 her own acts and omissions and therefore recovery is barred or reduced by her intentional, 22 comparative or contributory fault as the case may be. 23 2. 24 3. 25
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Plaintiff incorporates herein by reference, as though fully set forth at length,

Defendant IndyMac did not provide Plaintiff with a Good Faith Estimate or a

IV. AFFIRMATIVE DEFENSES By way of further answer and without admitting any matters previously denied,

The Plaintiffs damages, if any, were proximately caused by or contributed to by

The Plaintiff has failed to mitigate her damages, if any. The Plaintiff has failed to state a claim upon which relief can be granted.

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1 4. 2 5. 3 limitations as provided in 15 USC 1640(e). 4 6. 5 Proc. 9(g). 6 7. 7 elements with the particularity required in paragraphs 2.6 and 3.11 by Fed. R. Civ. Proc. 9(b). 8 8. 9 61.24.130. 10 9. 11 delayed unnecessarily bringing this action, has unclean hands, admits that she has signed 12 documents that are false or contrary to her allegations and otherwise acted inequitably to the 13 prejudice of this defendant. She is barred from asserting her claims because of her unlawful and 14 inequitable conduct. 15 16 17 be warranted by discovery. 18 19 20 judgment as follows: 21 1. 22 dismissed with prejudice. 23 2. 24 provided by law. 25
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Plaintiffs claims are barred by the applicable statute of limitations. Any claim under 15 USC 1631 et seq. is barred by the one-year statute of

The plaintiff has failed to plead her special damages as required by Fed. R. Civ.

The plaintiff has alleged fraud or misrepresentation but failed to plead the

The plaintiff has waived any right to relief by failing to comply with RCW

As to this defendant, the plaintiffs claims are inequitable in that the plaintiff has

V. RESERVATION OF RIGHTS These answering defendants reserve the right to add further parties and defenses as may

VI. PRAYER FOR RELIEF WHEREFORE, having answered plaintiffs complaint as follows defendant prays for

The plaintiff should take nothing by her complaint and the same should be

This defendant should recover its costs, disbursements and attorneys fees as

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1 3. 2 proper. 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
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The Court should grant such other and further relief as may be deemed just and

DATED this 5th day of March 2009. LEE SMART, P.S., INC.

By:______________________________________ William L. Cameron, WSBA No. 5108 Of Attorneys for Defendant Metropolitan Motion Group