Title: The Bank of New York v. Quevedo

State: hawaii

Issuer: Hawaii Supreme Court

Document:

‘eemor FOR PUBLICATION***

Neen ae

No. 25512

ay
a
S0ud

IN THE SUPREME COURT OF THE STATE OF HAWAT'Z=)

et

‘THE BANK OF NEW YORK, AS TRUSTEE OF ANRESCO’|

RESIDENTIAL SECURITIES CORPORATION MORTGAGE LOAN

TRUST 1997-2 UNDER THE POOLING AND SERVICING AGREEMENT
DATED AS OF JUNE 1, 1997, Plaintiff-Appellee

WLI

cy

vs.

LOLITA VALDEZ QUEVEDO aka LOLITA QUEVEDO,
Defendant-Appel lant

and
AVELINO JARA MILLO QUEVEDO aka AVELINO QUEVEDO,

JOHN and MARY DOES 1-20, DOE PARTNERSHIPS, CORPORATIONS
‘or OTHER ENTITIES 1-20, Defendants

ee
APPEAL FROM THE THIRD CIRCUIT COURT
(cIv. NO. 998-117)

y TION
(By: Moon, C.J., Levinson, Nakayama,
‘Acoba, and Duffy, JJ.)

Defendant-Appellant Lolita Valdez Quevedo (Appellant)
appeals from a Novenber 4, 2002 order of the circuit court of the
third circuit’ (the court) denying Appellant's Hawai'i Rules of

Civil Procedure (HRCP) Rule 59(e)? motion for reconsideration of

+ The Honorable Riki May Anano presided.

+ Ree Rute $9(@) (2003)

 

Rule 59, NEW TRIALS) AMENDMENT OF JUDGAENTS,

ie) Motion to alter or azend judgaent. Any motion to
alter or amends judgment shall be filed no later than 10
Gays after entry of tne Juggment.

aad
 

/*NOT FOR PUBLICATION*#*

 

‘an August 28, 2002 order denying Appellant’ HRCP Rule 60(b)*
motion to set aside judgment and decree of foreclosure. We
affim.

on appeal, Appellant contends that the court erred in
granting summary judgnent and a decree of foreclosure because
(2) the only Loan ledger introduced at the summary judgment
hearing was that of a diffe
different mortgage loan, (2) Appellant had submitted a sworn

declaration that she and her husband (the Quevedos) had not

 

nt borrower, pertaining to a

received, at loan closing, two completed copies of the notice of
the right to cancel the mortgage transaction and had sent timely
notices of cancellation of their secured loan, copies of which
Were introduced into evidence without objection, (3) Appellant,
previously discharged in bankruptcy, was not asserting an
affirmative claim but a Truth-in-Lending Act (TILA) recoupment
defense which she had standing jointly with her bankruptcy
trustee to allege, (4) the court should have considered the
merits of Appellant's affirmative defenses and not merely decided
whether Plaintiff-Appellee, The Bank of New York, as Trustee of
AMRESCO Residential Securities Corporation Mortgage Loan Trust
1997-2 under the Pooling and Servicing Agreement Dated as of June
1, 1997 (Appellee) satisfied the test for foreclosures set forth

> RCP Rule 60(b) (2003) states in relevant part as follows:

Role 60. RELIEF FROM JUDGMENT OR ORDER.

 

(b) Mistakes; inadvertance; excusable neglect.
newly discovered evidence; fraud, ete. On motion and
lupon such terms as are just, the court may relieve a
party or a party's legal representative from a final

jent, order, or proceeding for the following
sons: |. - + (4) the judgnent is voids... oF
(6) any other reason Justifying relief from the
operation of the Judgment

     

 

    
‘s#*HOT FOR PUBLICATION***
Oe

in Bank of Honolulu, NA. vs Anderson, 3 Haw. App. 545, 654 P.2d
1370 (1982), and (5) Appellant is entitled to HRCP Rule 60(b)
relief as the errors conmitted by the court are, in part, not
only jurisdictional, but amount to @ serious violation of due
process and equal protection of the law.

“HRP [Rule] 59(e) motions for reconsideration are
reviewed under the abuse of discretion standard.” Kaneohe Bay
Cruises, Inc. v. Hirata, 75 Haw. 250, 258, 861 P.2d 1, 6 (1993).
Generally, HRCP Rule 60(b) motions are also reviewed for abuse of
discretion. See Hawai'i Hous, Auth, v. Uehara, 77 Hawai'i 144,
147, 683 P.24 65, 62 (1994) (citing Paxton v, State, 2 Haw. App.
46, 48, 625 P.2d 1052, 1054 (1981)). However, in the application
of HRCP Rule 60(b) (4), this court has said that “[i]n the sound
interest of finality, the concept of void judgment must be
narrowly restricted,” and thus, “{a] judgment is void only if the
court that rendered it lacked jurisdiction of the subject matter,
or of the parties, or if it acted in a manner inconsistent with
of law.” Meindl v, Geneave Pac, Techs., Inc. (in re

Genesys Data Teche., Inca}, 95 Hawai'i 33, 38, 18 P.3d 895, 900
(2001) (internal quotation marks and citations omitted). As

due proce:

 

such, HRCP Rule 60(b) (4) motions are reviewed under the
right/wrong standard. See Keno‘o v. Kane, 106 Hawai'i 270, 281,
103 P.3d 939, 950 (2005).

As to her first contention, Appellant argues that
Appellee failed to meet its burden of proof on its motion for
summary judgment inasmuch as its submission of an incorrect
ledger amounted to inadmissible hearsay. However, Appellant
admitted, under direct questioning by the judge and with her
attorney present, that she had not made mortgage payments for two

or possibly three years. Appellant's statements made in court

3
‘seNOT FOR PUBLICATIONS #®
Se
and on the record were admissions made by @ party-opponent. In
its summary judgment motion and at the hearing, Appellee pointed
out that Appellant had failed to deny Appellee’s interrogatory
request for an admission that she had “not made all the payments
due and owing” under the mortgage. See HRCP Rule 36(a) (2001).
Moreover, the court extended Appellant an opportunity to correct
the ledger discrepancies in the record by supplementing
Appellant's written opposition to the summary judgment motion, an
opportunity that Appellant did not act upon.

In Light of these considerations, the court properly
granted summary judgment and a decree of foreclosure in favor of
Appellee. The incorrect ledger, while indeed inadmissible, was
rendered immaterial by Appellant’s own admissions of nonpayment
at the summary judgment hearing and by the failure to respond to
the aforesaid interrogatory. Thus, the court did not abuse its
Giscretion in denying both Appellant’s HRCP Rule 60(b) motion to
set aside the summary judgment and the subsequent HRCP Rule 59(e)
motion to reconsider.

Appellant appears to argue that GE. Capital Hawai’
Inc. vs Yonenaka, 96 Hawai'i 32, 25 P.3d 807 (App. 2001), holds
that the submission of an erroneous ledger renders the order
granting a motion for summary judgment per ge reversible.
However, this court overturned Yonenaka in part. See Brice v
AIG Haw. Ins, Co., 107 Hawai'i 106, 111-12, 111 P.3d 1, 7-8
(2005) (holding that absent plain error, “a party who fails to
object to inadmissible affidavits and exhibits waives the right
to do 80 on appeal”).

As to her fourth contention, Appellant argues that the
court erred in applying the four-prong test set forth in
‘#eMOT FOR PUBLICATION®**
i
Anderson‘ without considering the merits of Appellant’s
“affirmative defenses.”* An examination of the record indicates
that although Appellant raised certain defenses in her initial
pleading, she argued only the mistakenly submitted ledger and a
TILA defense in subsequent filings with the court. Generally,
this court will “disregard [a] particular contention” if the
appellant “makes no discernible argument in support of that
position[.]” Norton v. Admin, Dir, of the Court, 80 Hawai'i 197,
200, 908 P.2d S45, 548 (1995), recon, denied, 80 Hawai'i 357, 910
P.2d 128 (1996). See Hawai’
28(b) (7) (“Points not argued may be deemed waived."). Based on

 

Rules of Appellate Procedure Rule

the record, Appellant has not made 2 discernible argument with
respect to the defenses listed in her Answer, except insofar as
the TILA defense may be impliedly incorporated.

As to Appellant’s second and third arguments, she
claims that the court incorrectly ruled that she lacked standing
to raise the TILA defense that Appellee failed to comply with
mandatory federal disclosure requirements at loan closing.

TIM s “buyer's

Business days to" F

tht uses their principal dwelling as secu
$ 1625(a).(') TILA and ite regulations,

 

sree" provision allows borrowers thre
jeind, without penalty, a consuner loan

ey. 1S U.S.C
by the

 

 

  

tn Anderson, the Intermediete Court of Appeals established that on
a motion for summary Judgment, mortgage foreclosures require proof of (1) the
Galstence of the Agreanent, (2) the terms of the Agreement, (3) default by the
borrower under the terms of the Agreement, and (4) notice by the lender of
Cencellation to the borrower. "3 Haw. App: at S51, 654 P.2d at 1375.

 

+ see Gece Fin, Comm v. Jaffarian, 79 Hawai's S16, 526, 904 P.2d
530, §40 (App. (Acoba, J, concurring) ("An affirmative defense ‘is one that
will defeat the plaintiff’ claim if it is accepted by the court.” | (Internal
Guotation sarks, brackets, and citation omitted-))y aff'd, 80 Hawai'i 118, 905
Bra 624 (1995).

+ 15 0,8.c. § 1635(a) (2997) stats

 

§ 1635. Right of rescission as to certain transactions
jal Disclosure ef obligor’s right to rescind.

Except as otherniee provided in this section, in the

of any conauner credit transaction (including opening

 

5
‘*sNOT FOR PUBLICATIONS #*

Federal Reserve System, 12 C.F.R, $§ 226.1-29 ("Reg 2"),
Fequire the lender to provide a form stating the specific
Gate on which the three-day rescission period expires. 15,
Orsvcy $1698 (a)y 12 CaPsRe § 226.2300) (5) -(°]

Semar_v. Platte Vallev Fed, Sav, & Loan Ass'n, 791 F.2d 699, 701~
02 (9th Cir. 1986). Tf the lender fails to deliver the required

 

notice of material disclosures, the borrower may rescind the loan
within three years after consummation. 15 U.S.C. § 1635(f)
(1997) 3" 12 C.E.R. § 226.23(a) (3) (1997). See also Semar, 791

 

or Ancreasing the credit limit for an open end credit plan)
in which a security interest, including any such interest
arising by operation of Iau, "is or will be retained oF
Acquired in any property which is used a5 the principal
dwelling of the person to whom credit ss extended, he

hntLLaldnicht of the third business day following the
‘fonsummation of the transaction or the delivery of the

Eogether with a statement containing the material
Giselosuses required under this subchapter, whichever is
Tater, by notitying the creditor, in accordance with
fegulations of the Board, of his intention to does. The
yin
‘Sccordance with regulations of the Board, to any obligor in
2 transaction subject to this section the rights of the
Sbligor under this section.
provide, in accordance with regulations of the Board,

 

 

 

 

ese eet
(emphases added.)

+ 12 8.8. 226.23(b) (1997) states in relevant part:

(b) (2) Notice of clone to rescind. in a transaction
subject to rescission, a creditor shall deliver 2 copies of

‘entitled
fo rescind. The notice shall be on 2 separate document that
identifies the transaction and shall clearly and
conspicuously disclose the following:

(7) The date the rescission period expires.

 

(Baphases added.)
+ 15 u.s.c. 1635 (4) (2997) states:

(£) Tine Limit for exercise of right

veors after the date of consummation of the transaction or
upon the sale of the provertys uhichever occurs iret,

6
‘*#*MOT FOR PUBLICATION***

F.2d at 701-02.

As to the standing question, the court held that

Appellant lacked standing to raise a TILA defense because she had

been discharged in bankruptcy. In a bankruptcy matter, the

estate consists of “all legal or equitable interests of the

debtor in property as of the commencement of the case.”* 11

notujthstandina the fact that the information and toms
Kegulred under this section of any other disclosures,

‘Shiiaer, except that if (1) any agency empowered to enforce
the provisions of this subchapter institutes a proceeding to
enforce the provisions of this section within three years
after the date of consumation of the transaction, (2) such
agency finds a violation of this section, and (3) the
Sbligde's right to rescind 1s based in whole or in part on
Gny wetter involved in auch proceeaing, then the obligor's
Fighe of rescission shall expire three years after the date
of consummation Of the transaction of upon tl

Of the property, or upon the expiration of one year
foLlowing the conclusion of the proceeding, or any judicial
feview of period for Suaicial review therect, whichever 1s

      

 

 

 

(Emphasis added.)

 

12 C.F.R, § 226.23(a) (3) (2987) states:
(a) Consumer's right to rescind,

ia} ine consumer say exercise the right to rescind
until midnight of the third business day following
Consummation, delivery of the notice required by paragraph
(b) of this section, ox delivery of all material
Gseclosures, whichever occurs last.

 

 

eicind shell expice 3 years after consummation, upon
Efanafer of all of the consuner's interest in the property,
upon sele of the property, whichever occurs first. In the
case Of certain acministrative proceedings, the rescission
period shall be extended in accordance with section 125(£)
Of the act

 

added.)

11 U.8.c, § $42(a)(2) (2998) stat

 

§ S41, Property of the estate.
(2) The Commencement of @ case under section 301, 302,
or 303 of this title creates an estate. Such estate is
Gonprised of ail the following property, wherever located
and by whomever held:
(2) "Excepe as provided An subsections (b) and (c) (2)

1
‘***MOT FOR PUBLICATION:
eee

 

U.S.C. § 541(a) (1) (1998). Additionally, inasmuch as 11 U.S.C. §
323" states that “the trustee in a [bankruptcy case] has capacity
to sue and be sued,” Appellee asserts that a discharged debtor's
causes of action belong to the bankruptcy trustee.

In Rowland v. Novus Financial Corp., 949 F. Supp. 1447
(D. Haw, 1996), the plaintiff-borrower sought rescission of a
refinanced mortgage, alleging TILA violations by defendant-
mortgagor. Id, at 1450, The plaintiff subsequently filed for
Chapter 7 bankruptcy. Id, at 1451, For this reason, the Unite
States District Court for the District of Hawai'i held that the
plaintiff lacked standing to bring his suit, inasmuch as his
“ITLA cause of action existed prior to the bankruptcy and
therefore [was) included in the bankruptcy estate.” Id. at 1453.
Consequently, the “bankruptcy estate [was] the proper plaintiff
in (that) case.” Ide

Likewise here, Appellant's cause of action existed
prior to her filing for bankruptcy. Appellee refinanced the
‘Quevedos’ loan on March 10, 1997. Thus, any TILA cause of
action, including the purported failure to provide notice of the
right to cancel the mortgage, would have accrued on this date.
Appellant filed for bankruptcy on October 6, 1998 and was
discharged from bankruptcy on January 6, 1999. Because her TILA
cause of action was in existence prior to these dates, it

constituted “property” belonging to the bankruptcy estate, see

 

of this section, all legal or equitable interests of the
Geptor in property as of the commencement of the cast

 

© La.s.c. $ 323 (1998) stat

 

§ 523. Role and capacity of trustee.
(a) The trustee in 2 case under this title is the
tative of the est

(p) the trustee in s case under this title hes

capacity to sue and be sued

 

   

 
‘seenon FOR PUBLICATION***
—
Ad ("[clourts have long held that the definition of ‘property
extends (to) causes of action, including TILA claims. As the 7th
circuit has articulated, there is ‘no question . . . that the
bankruptcy estate includes causes of action such as truth in
lending clains.’” (Quoting In xe Smith, 640 F.2d 688, 890, 692
(7th cir. 1981).) (brackets omitted)), and, hence, “must (have
been] asserted by the bankruptcy trustee rather than” Appellant,
iid. thus, pursuant to the general rule under Bowland, Appellant
lacked standing to raise a TILA claim.

The Rowland court, however, noted two exceptions to the
general rule. Plaintiffs-debtors may raise a TILA claim if they
scan show either (1) that the TILA cause of action falls under
the bankruptcy exemption or (2) that the bankruptcy trustee has
abandoned the TILA claims.” Id, Because the plaintiff in
Rowland had not even alleged that his TILA cause of action was

‘exempted from the bankruptcy estate or that it had been abandoned

 

by the bankruptcy trustee, the court held that “[i]n the absence
of such a showing, the bankruptcy trustee [was] the proper
plaintiff for [that] suit.” Id, at 1454.

Similarly, in the present case, Appellant has not shown
that her TILA right of rescission was exempted from the
bankruptcy estate or that it was abandoned by the bankruptcy
trustee. The court’s conditional grant of summary judgment
offered Appellant the opportunity to supplement the record with
documentation of her exemption and reaffirmation of the subject
property following bankruptcy, but Appellant failed to submit
this to the court. Therefore, to the court’s knowledge at the
summary judgment phase, the TILA cause of action based on the
right to rescind belonged to the bankruptcy estate and could only
be asserted by the bankruptcy trustee, not Appellant.

9
‘**NOT FOR PUBLICATION*#*

 

Nonetheless, Appellant submits that a discharged debtor
and the debtor's bankruptcy trustee both have the right to assert
a TILA recoupment defense. Appellant cites to Bacific Concrete
Federal Credit Union v. Kauance, 62 Haw. 334, 614 P.2d 939
(1980), and a number of federal cases regarding the standing
issue. In Pacific Concrete, this court recognized appellant-
debtor's counterclaim against appellee-credit union as
recoupment defense based on the credit union's TILA violations,
and held that, in contrast to an affirmative claim, such a
defense may be brought regardless of the one-year statute of
Limitations. Id, at 337, 614 P.2d at 938-939. Bacitic Concrete,
however, is distinguishable as it does not address the rights of
a debtor who has been discharged in bankruptcy." Moreover, the

 

case does not support Appellant's characterization of her TILA
claim as a recoupment defense.

Pacific Concrete did not involve a foreclosure action.
Rather, the plaintiff lender in that case was suing the defendant
for the outstanding balance owing on the loans. Id, at 335, 614
P.2d at 937. The TILA defense in that case was held to be “in
the nature of a recoupment defense” because it “arose out of the

same loan transaction as [the lender’s] suit and. . . [could]

 

Appellant algo cites to certain federal ca:
‘Tush Savings Bank z, Nasz (In ce Nasr), 120 8.8. 855,
1530) (holding that, In the context of plaintift-bank!
defendant-debtor’s dischargeability, the debtor's 7
Gefenses were not exclusive to the bankruptcy trustee
haa standing to reise then), Sulvester v. Martin
939 (Bankr. N.D. TLl, 1991)’ (recognising Gefengant-cebtor’s ©:

jetofi a2 a defense, pursuant to 11 U.S.C. $558, against pl
Adversary proceeding to defendant's Chapter 7 bankruptcy case, where
Plaintiffs sought to hold nondischargesble a judgnent-cebt they had previously
Obtained against defendant in a separate federal case), and Beach v. Ocwen
Fed. Bank, $23 U.S. £10, 419 (1998) concluding that TILA “permite so federal
Fight to rescind, defensively or otherwise, after the as
0.8.C.} § 1635 has run"), Like Pacific Concrete, however, these cases do not
specifically address the issue of a discharged debtor’ s right to raise a TILA
defense in a subsequent mortgage foreclosure proceeding.

 
 
  
  

 

 

 

        

     

 

10
oT FOR PUBLICATION***
ee
diminish [the lender’ s] recovery.” Id, at 341, 614 P.2d at 940
(emphases added). Appellant does not explain how her TILA clains
could “diminish” any “recovery” by Appellee in a foreclosure
action. As Appellee notes, “there is nothing in the record to
indicate that (the alleged TILA violations} cost her anything
which would be true recoupment.” Pacific Concrete, then, does

not transform Appellant’s TILA claim into a recoupment defense.

 

Appellant also emphasizes that she is not seeking to

 

prosecute a claim or counterclaim against Appellee; rather, she

is alleging TILA violations as a defense to Appellee’s
foreclosure action. She argues that “while it is true, as
[appellee's] counsel below correctly argued, that upon the filing
of a bankruptcy petition(,] all of the claims of @ debtor are
considered to be property of the debtor's estate, transferring
exclusive power to the estate’s trustee to prosecute all such
claims, pursuant to (11 U.S.C. § 541], [the rule) does not apply

to a debtor’s defenses[.]” Appellant contends that a trustee

 

would have no interest in raising a TILA claim on behalf of an
estate where the “secured creditor seeks to foreclose in state
court after the debtor’s discharge,” and therefore, “it would
make no sense to hold that [the] TILA recoupment had somehow been
lost to the discharged debtor who, unlike the trustee, is faced
with a loss of his or her property[.]” Within the context of a
bankruptcy proceeding, the court in Texas Trust Savings Bank v.
Nasr (in re Nasr), 120 B.R. 855, 858 (Bankr. S.D. Tex. 1990),

reasoned that “{a] trustee has no incentive to raise defenses in

 

a complaint to determine dischargeability since this would

© Appellee points out that “{alpplying (the] theory (in Bacitic
Concrete] to the instant cese, where the lender waived eny right to =
Geficiency judgment, recoupment, as a defensive tactic, 18 meaningless.”

n

 

 
‘**eMOT FOR PUBLICATION*#*
provide little or no benefit to the estate, but no reason has
been shown to bar debtor from raising these defenses.”

‘The Nasr court was persuaded by the reasoning supplied
by Collier on Bankruptey. Id, According to the treatise, the
Bankruptcy Code, at 11 U.S.C. § $58, “deals with all the debtor's
defenses,” and “provides the trustee with every defensive w
available to the debtor." 5 Collier on Bankruptey % 558.01(1) [a]
(Alan N. Resnick et al. eds., 15th ed. 2002). The treatise

 

further reasons:

The trustee is entitled to use a defense to its fullest

extent,

 

renin thie respect,
a right under {IT -U-8.c. $558) to assert the

   

She trsate

+ the reason for
thie difference is cl

 

Id. (emphases added). Nasr and Collier on Bankruptcy, however,
only address the right of rescission as it may be used
defensively during a bankruptcy proceeding, and do not shed light
fon the use of such a right following a debtor’s bankruptcy
discharge. Allowing Appellant to raise a TILA violation defense
in this case would not “prevent an unjust claim against” or
“minimize” the “possibility of recovery from the estate” inasmuch
as the bankruptcy case is now closed.

To reiterate, Appellant has been discharged in
bankruptcy. Appellant has said that she has standing to raise a
right of recoupment defensively, even if such a right belongs to
the bankruptcy trustee as a cause of action. But ultimately, the
remedy that Appellant seeks is rescission of a mortgage based on
the bank's alleged TILA violations. The effect of such a remedy
-- voiding of the mortgage -- is the same, regardless of whether

2
‘¢#*MOT FOR PUBLICATION®#*
As

 

the right to rescind is exercised as a claim or a defens

Appellee observes,

[clonstruing the TILA rescission right 2s an estate asset is
Yery logicel, as the rescission remedy under TILA clearly
Bilcts all of the assets of the estate which are available
fo other creditors. specifically, if the debtor is granted
Feseission, the lender joins the ranks of unsecured
Efediters because its lien is stripped off of the property:
{P the trustee wore to then sell the property, the proceeds
would be split among the unsecured creditors, rather than
Being applied to pay the lender's priority position.

 

 

Notably, Appellant had not documented to the court that
the debt had actually been exempted and reaffirmed, nor has she
taken this argunent up on appeal." Despite Appellant’s claims
that the subject mortgage had been exempted and that she intended
to reaffirm the debt, Appellant never filed bankruptcy documents
to support this contention.* The only bankruptcy documents in
the record were provided by Appellee and not Appellant. In its
opposition to Appellant’ s HRCP Rule 60(b) motion, Appellee
submitted bankruptcy documents that indicate Appellant elected to
exempt and intended to reaffirm the subject mortgage. However,
Appellant failed to point out the relevance of the bankruptcy
documents to her claim of standing, either (1) in her own HRCP
Rule 60(b) motion papers, (2) at the motion’s July 19, 2002
hearing, or (3) in later filings and motions to the court. In

 

“Appellant last argued that she intended to exenpt from bankruptcy
and reaffirm the subject mortgage st the October 3, 2001 summary Judgment
Rearing. Appellant does not advance this argument either in subsequent
motions to the court or on appeal

 

© Appellee submits that it filed these bankruptcy docunents merely

‘to show that Appellant had been discharged “from all dischargeable debts” on
January 6, 1999." In its opposition papers, Appellee argued that “although
TAppeliant) indicated an intention in [ner] bankruptcy documents to ‘reafficn’
the subject loan, (she) never properly documented any reaffirmation pursuant
Eo vbankzuptcy rules, thus nullitying the intention.” See in re Kamps, 217

R836, 840-842 (Bankr. C.0. Cal. 1998) (holding that the Bankruptcy Coc
Syeaftimnation rules are intended to protect debtors from compromising their
fresh start by making unwise agreements to repay dischargesble debts{,)” and
therefore, reaffirmation agreements are binding only Lf made in compliance
With the lengthy and substantial requirements set forth in (11 U.S.c.] §
S2e(e) and (a)

 

 

   

 

3
 

‘**¢NOT FOR PUBLICATION

 

Light of the record, Appellant failed to establish standing to
assert a right of rescission. ‘Thus, the court below did not
abuse its discretion and properly held that Appellant lacked
standing to raise her TILA defense.”

In her fifth and final argument, Appellant maintains
that the TILA violations rendered her mortgage unenforceable and
void as a matter of federal law, and therefore, the court's
granting of summary judgment was “clearly in excess of its
subject matter enforcement jurisdiction until the underlying
merits of that TILA issue could be determined." Appellant posits
that, under 15 U.S.C. 1635(b),"" if a borrower cancels a secured

Inasmuch ag the court was correct in determining that Appellant
did not have standing to raise a TILA defense, her argument that pursuant to
tera) Cr 3¢ Hawai 213, 223-25, 11,

Prsd-1, 11-3 (2000), federal law allows her to defensively assert a right of
rescission within three years of making the loan if a lender does not deliver
two mandatory “notices of right te cancel” to a borrower, need not be
Addressed. The discussion on standing also disposes of Appellant's arguments
on the merite of her THA claim.

   

 

% 15 0,8.c, 1635(b) (2997) states:

(b) Return of money or property following rescission.
‘under

subsection (a) of this section, he ia not liable for any
finance of other charge, and
She_abligas, inciuding any such inte
Spezation of Law,
Witnin 20 days after receipe of notice of Fesciasion, the
Creditor shall return to the obligor any money or property
Given as earnest money, dompaynent, or otherwise, and shall
Fake any action necessary of appropriate to reflect the
termination of any security interest created under the
transaction.

‘obligor, the ebiigse may Fe
he performance of the crediter-s oblications under this
‘ection. “the obligor shall tender the property to the
Exsditor, except that if return of the property in kind
Would be impracticable or inequitable, the obligor shall
fender its reasonable value. Tender shall be made at the
Location of the property or at the residence of the obligor,
atthe option of the obliger. If the creditor does not take
possession of the property within 20 days after tender by
the obligor, ownership of the property vests in the obligor
without obligation on his part to pay for it. The
Procedures prescribed by this subsection shail apply except
hen otherwise ordered ty 2 court.

 

arising By

 

  

   

 

 

14
‘**eNOT FOR PUBLICATION***
a
loan transaction, then the underlying security interest is to be
considered void by operation of federal law, preempting state
court enforcement under the Supremacy and Interstate Commerce
Clauses. It does not appear that 15 U.S.C. 1635(b) expressly
supports Appellant's assertion. In any event, as stated supra,
Appellant did not establish standing to raise the TILA defense.

Further, Appellant places great emphasis on the court
not having "subject matter enforcement jurisdiction," but does
not clearly define or substantiate it. Although Appellant cites
to a number of cases, she fails to provide any discernible
argument as to the applicability of the term “subject matter
enforcement jurisdiction.” See Wisconsin v. Pettit, 492 N.W.2d
633, 642 (Wis. Ct. App. 1992) (declining to address portions of a

 

brief “so lacking in organization and substance that for [the
court] to decide (the] issues, [it] would first have to develop
them{,] . . - [and] serve as both advocate and judge”).
Moreover, Appellee asserts that the court did have proper
jurisdiction. See Citicorp Mortgage, Inc, v. Bartolome, 94
Hawai'i 422, 434, 16 P.3d 827, 939 (App. 2000) (holding that a
determination under TILA that a note and mortgage were void and
unenforceable "would not oust personal or subject matter
jurisdiction"). Therefore,

In accordance with HRAP Rule 35, after carefully
reviewing the record and the briefs submitted by the parties, and
duly considering and analyzing the law relevant to the arguments
and issues raised by the parties,

IT IS HEREBY ORDERED that the court's November 4, 2002

order denying Appellant's HRCP Rule 59(e) motion to reconsider

 

(Bxphases added.)
as
‘+##NOT FOR PUBLICATIONS**

 

the August 29, 2002 order denying Appellant’s HRCP Rule 60(b)
motion is affirmed.

DATED: Honolulu, Hawai'i, August 17, 2005.
on the briefs:

cacy Victor Dubin for Gyn

Robert E. Chapman and Lea Ahonuro~
Mavy harcin tbeanton
UH Gepeen Ceumpton Neste Coates mee

Iwamura) for plaintiff-

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