N.Y. judge shutting down foreclosure mills

Back in October judges in New York courts started requiring lawyers in foreclosure cases to personally attest that the documents in their cases were true and correct. What a novel idea! This, it seems, was a problem for many attorneys.

On January 7 Judge Arthur M. Schack of a Brooklyn court dismissed a case with prejudice, when the lawyers couldn't file the required proof in a timely manner. The law firm was referred to as a "foreclosure mill" that had previously been sanctioned in frivolous cases.

Do we have "mills" in McHenry County? You know, law firms that specialize in foreclosures and routinely stand up before the judge and run through case after case after case?

I was in a courtroom in November and watched one lawyer present case after case to the judge, routinely requesting "body attachments."

In one case the lawyer was suing a car loan customer for the balance on a car loan. The customer had voluntarily turned in the car, after he lost his job and knew he could not keep up the payments. He says the lender's manager praised him for his responsibility (right before that manager lost his own job). The customer has been out of work for two years, and his home is in foreclosure. He had a mortgage restructuring deal worked out, so that he could keep the house, but he needed to clear the car loan debt at least temporarily, while the house loan was re-written.

The local McHenry County lawyer refused to back off, pushing his own bank client's right to collect. This is forcing the customer into bankruptcy, where he will now lose the house in which his family, including four children, live.

The lawyer got his judgment and will be able to report to his bank client that he "won." There won't be any money to collect, but I guess the little tally in the "Won" column will re-assure his client just how hard he is working.

I wonder whether legal ethics require a lawyer in some cases to recommend to his own client that they not proceed in certain cases. Or, when there is nothing to collect, is there a reason to work with a customer toward another solution? Either way, the bank wasn't going to get any money. If the lawyer works on a contingency on such cases, then he isn't going to get paid either way.

Was justice served in this case? Not hardly.