Source: http://www.certifiedforensicloanauditors.com/articles/07.17/proof-of-standing-required-seffar-v-residential-credit-solutions-inc.html
Timestamp: 2019-04-18 17:33:05+00:00

Document:
In the end we are closing in on the unthinkable: that anyone who was entitled to be treated as creditor was severed from the transactions leaving all other parties floating and leaving legal analysts to wonder (the borrower, that is) or make fraudulent representations (the banks and servicers) that the putative creditors cannot refute.
In the end, with very few exceptions, none of the trusts own anything and none of the servicers or trustees have any authority over any loans. This is the direct result of asymmetry of knowledge. The investors, the borrowers and the closing agents and even the sales agents do not have sufficient information to know what is going on — forcing everyone to look to the “Bank” who appears to be the source of funding.
And the Banks get to explain it in whatever way benefits them the most. They are thus permitted to explain away any hint that they were stealing investor money on an unprecedented scale. That is what happened in the TARP bailout and that is what happens in court.
Here is a 4th DCA case in Florida that spells out the difference between alleging a case and proving it.
Taoufiq SEFFAR, Appellant, v. RESIDENTIAL CREDIT SOLUTIONS, INC., Appellee.
About nine months after filing the complaint, RCS filed what it claimed was the "original" note. Filed with this note was an undated, blank allonge, payable to the bearer, allegedly executed by a vice president of ABN. Nothing about the appearance of this allonge, as contained in the appellate record, shows that it was affixed to the note with which it was filed. (e.s.) [EDITOR’S NOTE: NO PROOF THE “ALLONGE” WAS ATTACHED? THEN THE ALLONGE IS A NULLITY. NO PRESUMPTION APPLIES].
He testified that Bayview was the servicer and holder of the note. He believed that Bayview had acquired the note through a purchase agreement with RCS, but he had not seen the agreement, nor did he have a copy of it. His belief that Bayview was the owner of the note under the purchase agreement was based on "a screen shot of our capital assets systems, which has information in regards to the status of the loan with us." This screen shot was not produced at trial.
Although appellant moved for involuntary dismissal on the ground that Bayview had not proved standing because it had not shown that it had the right to enforce the note and foreclose the mortgage, the trial court rejected this claim. It entered a final judgment of foreclosure in which it found that Bayview was due and owing the unpaid balance of the note. This appeal follows.
Appellant argues that Bayview failed to prove that it was the owner or holder of the note and that it had the right to foreclose. Based upon this confusing record, we agree that it presented no competent evidence that RCS was the holder of the note at the time it filed suit or that it was a nonholder in possession and entitled to enforce the note. Therefore, Bayview failed to prove standing.
Standing may be established by either an assignment or an equitable transfer of the mortgage prior to the filing of the complaint. For example, standing may be established from a plaintiff&apos;s status as the note holder, regardless of any recorded assignments.
If the note does not name the plaintiff as the payee, the note must bear a special endorsement in favor of the plaintiff or a blank endorsement. Alternatively, the plaintiff may submit evidence of an assignment from the payee to the plaintiff.
Even in the absence of a valid written assignment, the mere delivery of a note and mortgage, with intention to pass the title, upon a proper consideration, will vest the equitable interest in the person to whom it is so delivered.
Id. at 173 (citations and quotation marks omitted).
Appellant notes several deficiencies in Bayview’s proof which result in a failure to show standing to foreclose the mortgage. First, while the note and mortgage were originally held by ABN, the only assignment of mortgage attached to the complaint and introduced at trial was one from FDIC as receiver for Franklin Bank to MERS as nominee for RCS. There is no proof of any transfer of the note or mortgage from ABN to Franklin Bank. Second, while Bayview contends that the undated allonge supplies the connection, as it shows a transfer payable to bearer, there was no proof that the allonge was attached to the note, and Bayview presented no proof of when it was executed. (e.s.) [EDITOR’S NOTE: THE ENDORSEMENT MEANS NOTHING IF IT WASN’T ON THE NOTE. IT WASN’T ON THE NOTE UNLESS THE ALLONGE WAS AFFIXED TO THE NOTE. THE ENDORSEMENT MEANS NOTHING WITHOUT FOUNDATION TESTIMONY PROVING THAT THE ENDORSER HAD THE AUTHORITY TO EXECUTE THE ENDORSEMENT] Finally, there was no competent evidence of what rights Bayview acquired from RCS.
"Because a promissory note is a negotiable instrument and because a mortgage provides the security for the repayment of the note, the person having standing to foreclose a note secured by a mortgage may be a nonholder in possession of the note who has the rights of a holder." Mazine v. M & I Bank, 67 So.3d 1129, 1130 (Fla. 1st DCA 2011).
A "person entitled to enforce" an instrument is: "(1) [t]he holder of the instrument; (2)[a] nonholder in possession of the instrument who has the rights of a holder; or (3)[a] person not in possession of the instrument who is entitled to enforce the instrument pursuant to s[ection] 673.3091 or s[ection] 673.4181(4)." § 673.3011, Fla. Stat. (2013). A "holder" is defined as "[t]he person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession." § 671.201(21)(a), Fla. Stat. (2013). Thus, to be a holder, the instrument must be payable to the person in possession or indorsed in blank. See § 671.201(5), Fla. Stat. (2013).
Although, nine months after filing the complaint, RCS filed what purported to be the original note with an allonge payable to bearer, it was undated and there is no proof it was affixed to the promissory note. "An allonge is a piece of paper annexed to a negotiable instrument or promissory note, on which to write endorsements for which there is no room on the instrument itself. Such must be so firmly affixed thereto as to become a part thereof." See Booker v. Sarasota, Inc., 707 So.2d 886, 887 n. 1 (Fla. 1st DCA 1998) (quoting Black’s Law Dictionary 76 (6th ed.1990)); see also Isaac v. Deutsche Bank Nat’l Trust Co., 74 So.3d 495, 496 n. 1 (Fla. 4th DCA 2011). The litigation manager did not know when the allonge was executed, or whether it was affixed to the note prior to filing. No evidence was presented that the allonge was executed and attached to the note prior to the filing of the initial complaint. Indeed, RCS did not allege in the complaint that it owned and held the mortgage. It merely alleged that it had the right to foreclose the note and mortgage. Therefore, the allonge provided no evidence that RCS was a "holder"at the time it filed the complaint.
HSBC was thus left to enforce the note under section 673.3011(2) as a nonholder in possession of the instrument with the rights of a holder. The issue then is whether HSBC is a nonholder in possession with the rights of a holder.
Anderson v. Burson, 424 Md. 232, 35 A.3d 452 (2011), is instructive. There, the court held that the plaintiff was a nonholder in possession and analyzed whether it had rights of enforcement pursuant to a Maryland statute that employs the same language as section 673.3011, Florida Statutes. Anderson, 35 A.3d at 462. "A transfer vests in the transferee only the rights enjoyed by the transferor, which may include the right to enforce [ment]," through the "shelter rule." Id. at 461-62.
Murray, 40 Fla. L. Weekly D239 (emphasis in original) (internal citations omitted). Because HSBC did not offer evidence of one of the prior transfers of the note, we held it did not prove that it was a nonholder in possession.
Similarly, in this case, Bayview did not prove that either RCS or itself was a nonholder in possession. It never connected FDIC as receiver of Franklin Bank, from which RCS acquired an assignment of mortgage, to ABN, the original note holder.
As alternative proof of its "ownership" of the note and mortgage, Bayview relied on a letter from RCS to the appellant, notifying him of the transfer of servicing rights to RCS, and a similar one from Bayview when it became the servicer of the loan. Neither letter addressed a right to enforce the note. None of the servicer agreements were placed in evidence to prove what rights either RCS or Bayview acquired under those agreements. (e.s.) [EDITOR’S NOTE: It is very rare that the servicer agreements are proffered by “Plaintiff” Trust (or other sham nominee) in evidence because those agreements, like Assignment and Assumption Agreements contain information that the securitization players don’t want the borrower, the court or government regulators or enforcers to see].Finally, as to the transfer between RCS and Bayview, the litigation manager testified that while he believed that Bayview purchased the note and mortgage from RCS, he had never seen a purchase agreement, and no document memorializing the purchase was entered into evidence. Therefore, because there is a gap in the transfer of the note and mortgage, Bayview did not prove that RCS, and subsequently Bayview, were nonholders in possession. See Murray, 40 Fla. L. Weekly D239.
Simply stated, the evidence presented was woefully inadequate to prove standing to foreclose. It was quite apparent from the record that Bayview’s litigation manager did not have the requisite knowledge, nor did he produce documentary evidence, to support the claim.
We thus reverse and direct judgment in favor of the appellant dismissing the foreclosure on the mortgage for failure of the appellee to prove its standing.
CIKLIN and GERBER, JJ., concur.

References: v. 
 v. 
 § 673
 § 671
 § 671
 v. 
 v. 
 v.