SCOTUS: Borrower Lacks Standing to Challenge PSA Violations

By Bob Hurt, 4 November 2015


The 2 November 2015 US Supreme Court denial of certiorari in Tran v Bank of New York settled once-and-for-all the spurious assertion that borrowers can challenge putative violations of the Pooling and Servicing Agreement (PSA) creating a securitization trust. Borrowers, encouraged by Glaski v BOA, a California appellate win for the borrower, have claimed that because New York Law voids assignment of a note into a trust after its closing date in the PSA, the assignee has no authority to enforce the note in a foreclosure effort.

This argument boils down to nothing more than a borrower’s effort to use quirks in the law to get a “free house” by preventing foreclosure because the borrower did not make timely payments. Bottom line the courts will not allow a borrower to get a free house unless the lender team injured the borrower sufficiently to justify it.

Numerous California courts have deprecated the Glaski opinion, as have other courts across the land.   Now the US Supreme Court has flicked its chin at it.

The US 2nd Circuit supported the NY Southern District in its reliance upon the 2nd Circuit’s Rajamin v Deutsche Bank opinion that borrowers lack standing to challenge the PSA or any assignment of the note because they

  1. Never became a party to the PSA or assignment
  2. Did not get injured by the PSA violation or assignment, and
  3. Receive no 3rd party benefits from the PSA or assignment.

Now, the SCOTUS has put the KIBOSH forever on the frivolous argument that the borrower can cite irregularities in obeying the PSA and assigning the note as a basis for stymieing a foreclosure. I have presented full opinions of the relevant cases. READ THEM.

If you want to know how to prove the lender team injured the borrower, and how the borrower can use that proof to win millions in compensatory and punitive damages, visit

Court Opinion Links:

  1. Tran v. Bank of New York, Supreme Court of the United States 2 Nov 2015
  2. Tran v. Bank of New York, Court of Appeals, 2nd Circuit 2015
  3. Tran v. Bank of New York, Dist. Court, SD New York 2014
  4. RAJAMIN v. DEUTSCHE BANK NATIONAL TRUST COMPANY, Court of Appeals, 2nd Circuit 2014
  5. Glaski v. Bank of America, 218 Cal. App. 4th 1079 – Cal: Court of Appeal, 5th Appellate Dist. 2013

 Download this article with the above opinions embedded.  Distribute broadly.

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29 thoughts on “SCOTUS: Borrower Lacks Standing to Challenge PSA Violations”

  1. Went to the Yvanova V. New Century Hearing Last week and not one mention about the U.S. Supreme Court’s decision not to hear the Tran case.

    The decision is likely to come down in 90 days.

    If it is reversed, then hopefully the lower courts would allow people to move forward on the mortgage fraud that was committed and that you all speak of.

    Until then, it is basically a no go (in California at least).


  2. Hi:

    I just asked two foreclosure attorneys (that don’t know each other) and they both stated this decision does not mean anything.

    Basically, it depends on the state that you live on whether or not you have standing.


  3. This denial applies nationwide, much to the chagrin of the scammers misleading homeowners with securitization arguments and audits based on that nonsense.


    1. I am in California and a major case (Yvanova V. New Century Mortgage) is set for a hearing in front of the California Supreme Court on December 2, 2015.

      I guess what would be the point of the hearing if this decision just came down and it would not depend on the state that you are in(?).


      1. Yvanova v. New Century Mortgage Corp., 226 Cal. App. 4th 495 – Cal: Court of Appeal, 2nd Appellate Dist., 1st Div. 2014

        The appellate court made it clear that the borrower had no standing to quiet title without first tendering payment, and that the borrower still owes the debt regardless of the faults in observing the PSA, in robosigning, in chain of title to the note, and in securitization,

        ” But plaintiff “may not assume the theoretical claims of hypothetical transferors and transferees” to assert causes of action for declaratory relief or wrongful foreclosure.”

        The court, in answer to the challenge that the Glaski opinion supported the plaintiff’s view, explained its deference to Jenkins over Glaski:

        “But no California court has followed Glaski on this point, and many have pointedly rejected it. (See, e.g., Apostol v. Citimortgage, Inc. (N.D.Cal., Nov. 21, 2013, No. 13-cv-01983-WHO) 2013 U.S.Dist. Lexis 167308, pp. *23-*24; Dahnken v. Wells Fargo Bank, N.A. (N.D.Cal., Nov. 8, 2013, C 13-2838 PJH) 2013 U.S.Dist. Lexis 160686; In re Sandri (Bankr. N.D.Cal. 2013) 501 B.R. 369.) And as discussed above, Jenkins is directly to the contrary. We agree with the reasoning in Jenkins, and decline to follow Glaski.”

        The California Supreme Court will put the permanent KIBOSH on the Glaski opinion, and on the nonsensical view that borrowers can justify breaching the note, or that they can avert foreclosure, by whining about wrongful assignment and securitization.

        As I have repeatedly preached at, only one reliable method exists for beating the bank in a dispute over the borrower’s breach of the note:

        1. Find out how the lender team injured the borrower; then if injuries exist,
        2. Negotiate for settlement favorable to borrower, and if that fails,
        3. Hire a competent lawyer, then
        4. SUE the injurious lender team members.

        Those needing a mortgage examination can call me at 727 669 5511.


    2. Thanks for your answer.

      Does that mean Massachusetts law that allows standing is out the window?

      If that is the case, then why even bother with state foreclosure laws?

      A bank uses state law to foreclose on the property.

      If they do not like state law, and they are challenged on the standing issue based on state law, all they have to do (it seems like) is move the case to Federal Court and win.

      That is what I am understanding.

      Am I correct?

      Thanks again.


      1. Mr. Hurt, I understand what your are saying about Yvanova V. New Century Mortgage.

        However, it is my opinion that the appellate court that heard and ruled on Yvanova got it wrong (along with all the other appellate courts that refused to follow Glaski.)

        Glaski was the only case of its kind that was brought in front of the California Supreme Court and they refused to de-publish it.

        If Glaski was full of flaws, why was it not de-published?

        If you take a look at Yvanova and the other rulings chastising Glaski, it was all basically cut and paste as to their courts’ reasoning.

        Further, if the California Supreme Court was going to put the “KIBOSH” on these late transfer cases, then why have they allowed other cases (most recently two weeks ago) to be put on hold pending Yvanova. (This makes a total of 6 including Yvanova).

        Don’t get me wrong, I may end up eating my words because of the Tran decision. I don’t know.

        But like I said, two foreclosure attorneys stated that that ruling would not have any bearing on California Law (and it makes sense because of the MERS I commented about earlier.)

        But the Yvanova hearing will be in Los Angeles and I do plan to attend to get a feel of it.


      2. Not only have the Ca. appellate courts laughed at Glaski, but the federal courts in Ca. have as well. Moreover, so have courts state and federal all over the country.


      3. Then they would also be laughing at the California Supreme Court for refusing to de-publish it.

        Again, I may be eating my words once the verdict in Yvanova V. New Century Mortgage is ruled on, however, it would defy logic for the California Supreme Court NOT to reverse the lower courts decisions for two obvious reasons:

        1.) They refused to de-publish Glaski which only encouraged foreclosure attorneys to take on cases based on that and

        2.) They have since given Cert. to at least 5 other cases pending the decision on Yvanova.

        I’m not sure if you are an attorney for the banks or what, but you seem to be so embedded in your quest to make it seem like these transfers were harmless at best that you are willing (like the courts are) to overlook the fact that they were actually breaking the law. (What part of the word void is not understood by judges and people like you.)

        On another note, if you or I were to break tax laws, what do you think would happen to us?


      4. Even assuming, as Glaski insisted, that New York law governs interpretation of the PSA, which it did not because the PSA was under Delaware law, and further assuming that the transfer of Glaskis’ loan to the Trust violated the terms of the PSA, that after-the-deadline transactions would merely be voidable at the election of one or more of the parties—not void as Glaski and the scammers would have everyone believe. Consequently, Glaski, was not a party to the PSA, and did not have standing to challenge it.

        Common sense would also dictate that if there are enormous numbers of late-delivered notes/mortgages, does anyone really believe that the holders of these notes/mortgages would rather lose the tax benefits by virtue of it becoming a taxable event, this highly unlikely because the IRS has failed to take any action so far, or lose the income from the notes/mortgages. Anyone who got out of the third grade can figure this one out, its not quantum physics.


      5. Domainscience, you seem fixated on problems with the chain of ownership of the note, but not at all concerned with three very important realities:

        1. The ONLY people who complain about that chain issue have become deadbeat borrowers who breached the note and want to find any cheap way possible to get out of paying the debt or losing the house to foreclosure. It really should bother you that MILLIONS of people try desperately to cheat the lenders out of their money.

        2. The ONLY reliable method for beating the banking/lending machinery lies in following the method the banks use to come after borrowers: FIND the injuries, NEGOTIATE, Hire a Lawyer, then SUE. Why haven’t you focused on how to find those injuries when you know that between 75% and 90+% of borrowers suffered injuries by somebody involved in that loan? You are leaving diamonds in the rough lying around on the ground. Pick them up. FIND the INJURIES.

        3. People who focus on chain of ownership statistically ALWAYS LOSE, and even the anomalous few who have gotten a temporary win end up wasting all that money on litigation because the right plaintiff comes back and attacks and wins the foreclosure. Any temporary victory is Pyrrhic because it costs a fortune, and the borrower is stuck with a house needing repairs and which the borrower has typically outgrown because of changes in family size during the the foreclosure fight (many have lost spouses over it).

        I don’t mean to seem rude when I say you need to wake up and smell the coffee, get your head out of the clouds, etc, and FOCUS on WHAT MATTERS and WHAT WINS. Fighting the foreclosure, especially by whining about securitization, robosigning, and PSA violations, is, pardon the expression, STUPID.


    1. Well, to begin with, the custom of precedence or stare decisis obliges courts to honor the opinions of their own court and those courts senior to it in the court hierarchy, and to consider advisory the opinions of coordinate courts. The 2nd Circuit includes NY, VT, and CT. So all the federal courts in those states should honor the Tran and Rajamin opinions of the 2nd Circuit. Furthermore, all other Circuits should honor them as advisory, most particularly because the SCOTUS denied cert in Tran, leaving that opinion in force.

      I imagine any lawyer who wants to fly in the face of the Tran cert denial will have to face a gale of opposing jurisprudence. I do not know of any law requiring a state court to heed a federal court opinion in a state law matter. But I do know that the Governor and US President can send out armed operatives to enforce court rulings and enacted laws.


      1. Gazing into the Crystal Ball: Reflections on the Standards State Judges Should Use to Ascertain Federal Law (William and Mary Law Review, V40, I4)

        “Federal courts use a single approach for ascertaining state law in cases in which it applies: they decide issues of state law the way they think the state supreme court would decide them.4 State courts, by contrast, do not use a uniform approach for ascertaining federal law. Instead, they use a wide variety of approaches.

        “Virtually all state courts agree that they are bound by U.S. Supreme Court decisions interpreting federal law. When the Supreme Court has not spoken, however, there is little agreement on how to proceed. State courts vary greatly in the weight they give to lower federal court decisions…

        “4. See Commissioner v. Estate of Bosch, 387 U.S. 456, 465 (1967) (noting that
        federal courts are bound by the decisions of a state’s highest court in determining
        questions of state law and must ascertain what the state law should be after giving
        “proper regard” to lower state court holdings); infra notes 211-17 and accompanying


      1. I was thinking about Ibanez when I wrote this part.
        However, Tran pointed out the U.S. Supreme Court that there is a split in the districts.

        Addressing constitutional standing to raise a similar
        claim based on a defective assignment of a mortgage,
        the First Circuit in Culhane v. Aurora Loan

        Services of Nebraska, 708 F.3d 282 (1st Cir. 2013),
        found more than sufficient injury for constitutional
        standing. In that case, Judge Selya, joined by Retired
        Justice Souter (sitting by designation) and
        Judge Lynch, held that a plaintiff facing foreclosure
        of her mortgage has constitutional standing to challenge
        the validity of the assignment of her mortgage
        and hence whether the foreclosing party properly
        owns her mortgage, even where she is neither a party-
        to nor a third-party beneficiary of the transaction
        by which her mortgage was assigned. 708 F.3d at

        Click to access Tran-Cert-Pet-Final-rev.pdf

        Trust me when I say that I am with you on attacking the mortgage.

        The fact that a person has standing for wrongful assignment will not mean much to a jury during a trial. Just read this case:

        Click to access B249717.PDF

        (In the above case, they actually did attack the origination of the mortgage and still lost.)

        However, we cannot even get to attacking the mortgage because Statute of Limitations. (At least that is what the judge said in our case.)

        When we brought up the fact that the transfer caused a break in title, thus a break in Statute of Limitations, we were told that we had no standing.

        In California, that is the problem with Attacking the Mortgage.

        In our case, this judge refuses to even consider the fact that not only two appeals courts reversed on the type of loan that we have stating that it was designed to deceive (therefore the statute of limitations does not apply), but the fact that the state made it illegal.

        Thanks again.


      2. There is no problem arguing mortgage attack in Ca. or anywhere else, the problem with the court case you cited was the homeowner committed bank fraud, that’s why she lost!


    2. @legisman

      First and foremost, the main argument in Yvanova V. New Century (which the California Supreme Court is set to hear on 12-02-2015 on the issue of standing) is that CALIFORNIA LAW ALLOWS STANDING, not New York, Delaware or any other state’s laws.

      The following is Yvanova’s answer to New Century’s reply:

      ” In their Answer Brief (or “Respondents’ brief”), respondents attempt
      to distract this Court by arguing New York law governs and by assuming
      the crucial contracts were negotiated by parties with equal bargaining
      power. But, California law controls the crucial issues and it does not favor

      The second main argument in Yvanova is that the Deed of Trust itself allows for standing:

      “…the Deed of Trust, the crucial consumer contract, gives the borrower
      clear notice that she can sue to challenge respondents’ purported power
      to foreclose. She can, in other words, allege standing.”

      Click to access Yvanova20150319.pdf

      Even the California Attorney General agreed that it has always been California Law that the proper party must foreclose with the Amicus Brief that she filed on the case:

      “In California, it has always been the rule that only a debt owner or its agent has authority to foreclose, as discussed more fully below.”

      Click to access final-amicus-brief-yvanova-pdf-pdf-attachment-copy.pdf

      As for the second part of your comment, I honestly do not even understand it.

      But if you mean the investors (who have most likely already been paid off through insurance) can always ratify the transfers, fine, then, let them do it.

      Then maybe there will not be an issue.

      But until there is a ratification, it is void as far as I am concerned.


      1. A void contract is “invalid or unlawful from its inception” and therefore cannot be enforced. 17A C.J.S. Contracts § 169. Thus, a mortgagor who was not a party to an assignment between mortgagees may nevertheless challenge the enforcement of a void assignment. A voidable contract, on the other hand, “is one where one or more of the parties have the power, by the manifestation of an election to do so, to avoid the legal relations created by the contract.” Id. Therefore, only one who was a party to a voidable contract has standing to challenge it.

        It is true that New York Estate Powers & Trusts Law § 7-2.4 states: “every act in contravention of the Trust is void.” New York case law, however, makes clear “that section 7-2.4 is not applied literally in New York. “Bank, 981 N.E.2d 1 (Ill. App. Ct. 2012). Instead, New York courts have held that a beneficiary can ratify a trustee’s ultra vires act. See, e.g., Mooney v. Madden, 597 N.Y.S.2d 775 (N.Y. App. 1993) (holding that trustee may bind trust to an otherwise invalid act or agreement that is outside scope of trustee’s power when beneficiary or beneficiaries consent or ratify trustee’s ultra vires act or agreement); Matter of Estate of Janes, 630 N.Y.S.2d 472, 477 (Sur. 1995), aff’d as modified sub nom. Matter of Janes, 643 N.Y.S.2d 972 (N.Y. App. Div. 1996), aff’d sub nom. Matter of Estate of Janes, 90 N.Y.2d 41 (N.Y. 1997)(acknowledging that a beneficiary may ratify a trustee’s ultra vires act if “the ratification was done with knowledge of material facts”); Leasing Serv. Corp. v. Vita Italian Restaurant, 566 N.Y.S.2d 796, 797-98 (N.Y. App. Div. 1991) (“It is hornbook law that a contract entered into by . . . an unauthorized agent, corporate officer, trustee or other person purporting to act in a representative capacity . . . is voidable.”); Hine v. Huntington, 103 N.Y.S. 535, 540 (1907) (“We have before this called attention to the fact that the cestui que trust is at perfect liberty to elect to approve an unauthorized investment and enjoy its profits, or to reject it at his option.”); 106 N.Y. Jur. 2d Trusts § 431 (“[T]rustee may bind trust to an otherwise invalid act or agreement which is outside the scope of the trustee’s power when beneficiary consents to or ratifies the trustee’s ultra vires act or agreement.”); see also In re Levy, 893 N.Y.S.2d 142, 144 (N.Y. App. Div. 2010) (explaining that “[t]he essence of ratification ‘is that the beneficiary unequivocally declares that he does not regard the act in question as a breach of trust but rather elects to treat it as a lawful transaction under the trust'”) (quoting Bogert, Law of Trusts and Trustees § 942).

        If an act may be ratified, it is voidable rather than void. See Hacket v. Hackett, 950 N.Y.S.2d 608, 2012 WL 669525, at *20 (N.Y. Sup. Ct. Feb. 21, 2012) (“A void contract cannot be ratified; it binds no one and is a nullity.

        However, an agreement that is merely voidable by one party leaves both parties at liberty to ratify the transaction and insist upon its performance.”) (quoting 27 Williston on Contracts § 70:13 [4th ed.]) (internal quotation marks omitted); 17 C.J.S. Contracts § 4 (noting that “a void contract . . . is no contract whatsoever” and “cannot be validated by ratification”) (emphasis added); id. (“A contract that is merely voidable is capable of being confirmed or ratified by the party having the right to avoid it . . . .”).

        These cases above make it obvious that, under New York law, a trustee’s unauthorized transactions may be ratified; such transactions, voidable—not void.

        That being the case, if the trustee of the securitized trust can’t, on its own, decide to accept these late-delivered notes, then it’s clear the beneficiaries can. They can ratify or waive anything they want. Common sense dictates that they can either, accept the notes/mortgages even though they were delivered late, giving the trust power to enforce, but theoretically putting the trust’s tax-exempt REMIC status at risk; or not allowing the trustee to accept the notes/mortgages, keeping their REMIC status alive, but denying themselves the income from the notes/mortgages they bought.

        You need to stop listening to scammers hawking securitization audits and arguments!


  4. “The US 2nd Circuit supported the NY Southern District in its reliance upon the 2nd Circuit’s Rajamin v Deutsche Bank opinion that borrowers lack standing to challenge the PSA or any assignment of the note because they

    1. Never became a party to the PSA or assignment
    2. Did not get injured by the PSA violation or assignment, and
    3. Receive no 3rd party benefits from the PSA or assignment.”

    If I had a dollar for the number of times I stated as much on LL (and got quite a bit of flack for), I’d be filthy rich by now. What is really troubling is that it is simply… contract 101 (first year of law school, mind you!) Something that all the self-proclaimed attorneys, who’ve been flirting with Garfield’s deluded elucubration for years, have used in pleadings, have been sanctioned and sometimes even disbarred over, knew or should have known.

    I don’t fault pro-se for having swallowed and regurgitated it almost verbatim in their pleadings, to subsequently lose everything they owned after a doomed uphill battle they never had a clue they were wrongly and dishonestly induced into waging. I do, however, find it outrageous and unconscionable that this country, will all its ruled and regulations about everyone and everything, has not found it necessary to shield said desperate and gullible pro se from predators such as Garfield, who not only encouraged them to fight that losing battle but knowingly and intentionally mislead them, and shamefully profited from their ignorance by selling them expensive products which, once again, he knew or should have known were completely inadmissible on foreclosure defense.

    If the BAR and courts have not -and will not- discipline their own dangerously rotten apples, this country is in a much worse dire straits than we can even imagine.

    What is even more astounding is that so many so-called foreclosure-defense law firms have been posting and reposting Garfield ad nauseam. Obviously, law schools in this country have gone down in the same toilet as regulatory agencies, Congress, finance and banking!


    1. The United States Supreme Court was asked to rule on a split in the First and Second Districts. (Massachusetts and New York Law).

      My assumption would be whether or not a challenge can be made would depend on what state that you live in based on their denial.

      Not sure if I am right or wrong, but what do you think?

      Thanks in advance for any response.


    2. @at Christine.

      To your three points, (2 which are basically the same), here is the answer:

      The trust was set up using tax code established under the Federal Tax Code.

      The tax code (whether one agrees with it or not) is set up for the benefit all the people living in this country.

      So if the tax code is broken the way these trusts have been breaking it with the late assignments, then hurts everyone because the interest should be forfeited.

      As for not being a party to the trust, that’s a good one. The home loan that one takes out makes you a party to the trust as your name is all over it.

      But, let’s just say you are correct, you are not a party.

      Then, in theory, all whistle blower lawsuits should be thrown out because, after all, the person that finds out how one, two, or more entities doing something wrong was never a party to the corruptness, and, in turn, had no legitimate reason for bringing a whistle blower action.

      I will wait for your answer as to how I am wrong on your points.

      Yes, I know the courts are say I am wrong, but it seems like Massachusetts got it right.


      1. I see a problem in your logic. You base it on the BAD ASSUMPTIONS that the trust breaks the tax code that that the borrower became a party to the trust or PSA simply because the borrower note became one of the instruments in the trustee’s property. So you come to wrong conclusions.

        The trust suffers certain consequences from not taking advantage of tax benefit opportunities. That does not mean the trustee broke the law. It just means the trustee pays higher taxes.

        And you KNOW that the borrower never became a party to the PSA because the Supreme Court denied Certiorari in Tran, and because the 2nd Circuit and other Circuits, and numerous state courts have opined that the borrower is not a party, to injured by, or beneficiary of the PSA or assignment of the note.

        If you disagree, why don’t you file a Qui Tam action and propound your facts and logic to the court?


      2. Mr. Hurt, the fact that the trusts broke the law is not an assumption but a fact. Even bank attorneys admit that.

        As far as the buyer goes, he became part of the trust when he/she signed the loan docs.

        Okay, so the Supreme Court did not take on Tran, but that does mean it applies to all 50

        Another example when in (I believe in 2011), a California attorney requested a hearing on MERS and the U.S. Supreme Court denied Cert.

        However, I believe in Oregan, it was ruled a couple of years later that MERS was not a beneficiary and could not

        At any rate, I will wait
        For Yvanova to see how the California Supreme Court rules.


    3. @legisman

      It’s a major problem if there is a statute of limitations issue.

      That’s why we need to show that we have standing in the break of title.


      1. There’s a way to overcome SOL, and there are always more than several issues in these mortgage transactions to attack!


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