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Co-Host: John Waihee
Foreclosure Workshop #48:
Kipuhulu Sugar Co. v. Nakila — Does a Different Statute of Limitations
Apply to the Enforcement of Mortgages than to the Enforcement of Notes?
In recent years, particularly in Florida, there has been increasing litigation regarding the applicability of the statute of limitations in foreclosure cases, and now courts in other states have started to wrestle in the mortgage context with this yet another confusing area of American law.
On prior shows we have discussed how the statute of limitations, which sets a time bar controlling how long litigants have to sue on their claims in court, should be and is being applied to mortgage loans (Listen to the January 31, 2016 Foreclosure Hour, Past Broadcasts, www.foreclosurehour.com).
Once again, the treatment of homeowners is shown to differ when compared to how the statute of limitations is applied in other contract actions.
Even though, for instance, a mortgage (and deed of trust) represent security for payment of the underlying debt and once the underlying debt obligation is uncollectible, having been paid or having expired by operation of law, it logically follows that the security for payment of the debt is extinguished as well.
But the requirements of logic never seem to deter foreclosure attorneys, who in Hawaii for instance have now begun somewhat successfully with a few judges to argue the opposite, that a mortgage continues to be enforceable up to twenty years even though the note has become unenforceable due to the expiration of the applicable contract statute of limitations.
Will this counter-intuitive argument be coming to your jurisdiction soon?
Tracing the more than one-hundred-year-old case law origins of this erroneous argument as we do on today’s show is not only important in order to block its likely use by foreclosure attorneys in the future, but is important also to expose some of the most alarming weaknesses in the misuse of the doctrine of stare decisis which some judges think requires that past judicial decisions be followed no matter what, particularly by lower courts.
Bad precedents can become, like deadly viruses, fatal to personal and property rights.
And lastly, this newly emerging and erroneous statute of limitations argument clearly illustrates why homeowners need to unite and collectively support the Homeowners SuperPAC as the only means of organizing nationally to effectively combat the otherwise proliferation of so many of these bad precedents being generated by what we have described on past shows as The Rule Ritual.
Gary Victor Dubin
Dubin Law Offices
Suite 3100, Harbor Court
55 Merchant Street
Honolulu, Hawaii 96813
Office: (808) 537-2300
Cellular: (808) 392-9191
Facsimile: (808) 523-7733
Licensed in California and Hawaii