[00:00:00] Speaker 00:
In Ray Ramsell money Ramsell Appellant and pro se Ross mummy council for appellee trustee Edward John Maney Leonard J. McDonald council for appellee Wells Fargo NA Okay, I'm gonna have a couple of Housekeeping questions first of all miss Ramsell.

[00:00:23] Speaker 06:
Do you want to reserve some time for rebuttal?

[00:00:25] Speaker ?:
I

[00:00:26] Speaker 06:
Okay, five minutes is fine with us and same rules, okay.

[00:00:31] Speaker 06:
I'll give you a heads up when you're getting close, but you have to decide ultimately when you want to stop with one argument and make your rebuttal.

[00:00:40] Speaker 06:
I think we've got two appellees here, so I'm going to tell them that you're going to have to split your 15 minutes or have one side simply take the argument.

[00:00:48] Speaker 06:
You don't have to tell me now, but when we begin the argument, I expect you to articulate whatever your method is going to be there, okay?

[00:00:56] Speaker 06:
Understood.

[00:00:58] Speaker 06:
Okay.

[00:00:58] Speaker 06:
Can I begin with a question for Ms.

[00:01:00] Speaker 06:
Ramselle?

[00:01:02] Speaker 06:
And we'll go ahead and start the timing now.

[00:01:04] Speaker 06:
Ms.

[00:01:04] Speaker 06:
Ramselle, I'm just kind of curious.

[00:01:06] Speaker 06:
I know the house was sold, the Bronco property.

[00:01:09] Speaker 06:
Are you still living there ma'am?

[00:01:11] Speaker 06:
Yes.

[00:01:12] Speaker 06:
Okay.

[00:01:12] Speaker 06:
Thank you very much.

[00:01:13] Speaker 06:
I wanted to know that.

[00:01:13] Speaker 06:
Thank you.

[00:01:14] Speaker 06:
Go ahead and you have the floor virtually.

[00:01:18] Speaker 06:
Go ahead and tell us your thinking here.

[00:01:20] Speaker 04:
Trustee filed this motion to dismiss the bankruptcy because of bad faith, saying that the key issue is that I have no intention to repay the mortgage debt, and that's not true.

[00:01:31] Speaker 04:
The only entity that have alleged to have any mortgage debt is Wells Fargo, and they are the only one who have filed proof of claim.

[00:01:38] Speaker 06:
You know, can I make a comment?

[00:01:40] Speaker 06:
You're a little bit faint, and I think you're a little bit soft-spoken.

[00:01:43] Speaker 06:
Can you talk more directly in the microphone so we get every word?

[00:01:46] Speaker 06:
Sure.

[00:01:47] Speaker 04:
Thank you.

[00:01:47] Speaker 04:
Can you hear me okay?

[00:01:48] Speaker 06:
Yeah, that's better.

[00:01:48] Speaker 06:
Thank you very much.

[00:01:49] Speaker 04:
Okay, thank you.

[00:01:50] Speaker 06:
You're welcome.

[00:01:52] Speaker 04:
Well, the only entity that has found any proof of claim is Wells Fargo.

[00:01:57] Speaker 04:
And Wells Fargo

[00:02:00] Speaker 04:
The trustee said that, well, I don't necessarily have to miss Wells Fargo in my schedule and plan, but rather that I have proposed to pay no one.

[00:02:10] Speaker 04:
And I'm arguing that the trustee's argument is wrong because no one is not a legitimate claim.

[00:02:16] Speaker 04:
There has to be a main party, and that main party have to be a party holding the note and holding the deed of trust in order for it to be entitled to enforce the mortgage.

[00:02:27] Speaker 04:
So Wells Fargo is the only main party filing the proof of claim, but Wells Fargo is not the party holding the note in the deed of trust.

[00:02:37] Speaker 04:
And Wells Fargo is not a party in interest and Wells Fargo is not entitled to enforce.

[00:02:44] Speaker 04:
And so, trust is fully aware of the fact that Wells Fargo is the only entity that has filed this proof of claim and alleged a mortgage debt.

[00:02:56] Speaker 04:
The one and only proof of playing far in this case of market debt is really Wells Fargo.

[00:03:03] Speaker 04:
And Wells Fargo sold the trust business on November 1st, 2021, which is two years before the bankruptcy was filed.

[00:03:13] Speaker 04:
And when Wells Fargo already sold the corporate trust services business, they are no longer party in interest.

[00:03:19] Speaker 04:
They cannot add a trustee.

[00:03:21] Speaker 04:
They cannot function as a trustee.

[00:03:23] Speaker 04:
And we know for a fact from the public records of governmental website, Wells Fargo is not entitled to enforce or entitled to repay other day sold trust business.

[00:03:35] Speaker 04:
And so Wells Fargo's proof of claim is fraudulent.

[00:03:38] Speaker 04:
And Wells Fargo and its alleged attorney have committed perjury because they misrepresented to the bankruptcy court and also to this court.

[00:03:48] Speaker 04:
And in order to avert the attention to Wells Fargo's fraudulent conduct, trustee is trying to put the blame on me for filing in bad faith.

[00:03:57] Speaker 04:
And the trustee is trying to divert the attention of the main issue, which is misrepresentation, perjury, and filing fraudulent proof of claim.

[00:04:07] Speaker 01:
Ms.

[00:04:07] Speaker 01:
Ramzell, can I ask you a question?

[00:04:09] Speaker 01:
This is Judge Corbett.

[00:04:11] Speaker 01:
In your second bankruptcy,

[00:04:16] Speaker 01:
You did not identify any mortgage obligation in your schedules, and instead you only identified your husband as a secured creditor.

[00:04:26] Speaker 01:
There's the question of who holds the secured debt, but it sounds like you're agreeing that there might be a secured debt out there.

[00:04:34] Speaker 01:
But there's a secure debt out there, but nothing in your plan or in your schedules would indicate that you were planning to pay that in your bankruptcy case.

[00:04:45] Speaker 01:
Wouldn't that be enough to dismiss your case?

[00:04:49] Speaker 04:
Well I can explain that if you look at the proof of claim that's filed by Wells Fargo in the schedule that is attached to the proof of claim you can see that there's a full amount of the mortgage amount

[00:05:05] Speaker 04:
credited into the account that means that the servicer have received the funds and so the debt should be discharged but the servicer refused to apply it to the correct account they put it into unapplied funds sitting into the accounts

[00:05:21] Speaker 06:
Well, can I interrupt you for a second here?

[00:05:24] Speaker 06:
So we kind of stay on track.

[00:05:25] Speaker 06:
And again, you can use your time any way you want.

[00:05:28] Speaker 06:
But what we have to decide here is whether the bankruptcy court made a mistake in dismissing the case.

[00:05:34] Speaker 06:
And if I can follow up on Judge Corbett's question, what Judge Corbett is remarking on is the fact that the bankruptcy court believed that a combination of a number of cases filed by you and your husband

[00:05:47] Speaker 06:
and apparent willingness to pay nobody on this secured debt.

[00:05:52] Speaker 06:
Because frankly, the plans did not take any account of it.

[00:05:56] Speaker 06:
Neither did the schedules.

[00:05:58] Speaker 06:
And that as far as Wells Fargo is concerned, they, or you may say somebody else, owes about $1.1 million here, and about $600,000 of that is past due.

[00:06:08] Speaker 06:
The position of the trustee was that was demonstrably not dealt with in your plan three times.

[00:06:15] Speaker 06:
And that kind of repetition of an unwillingness to use the bankruptcy code to actually pay some debts is grounds for dismissal for bad faith.

[00:06:24] Speaker 06:
Plus the fact that there is no reality that I'm aware of in which you could pay that.

[00:06:28] Speaker 06:
No offense.

[00:06:29] Speaker 06:
You simply don't have the income to do it.

[00:06:31] Speaker 06:
So part of the, you know, the bat-based analysis doesn't mean that you're a bad person, or it just means that you're using the bankruptcy code in a way that it really, you know, you can't get to a cognizable bankruptcy outcome.

[00:06:44] Speaker 06:
And that's what the bankruptcy court seems to have said in response to the trustees' motion to dismiss not Wells Fargo's.

[00:06:50] Speaker 06:
So there's a lot of reasons why the bankruptcy court believe this case should be dismissed, and you should be barred for a year.

[00:06:57] Speaker 06:
You need to tell us why that was a mistake.

[00:06:59] Speaker 06:
I mean, it's not so much what Wells Fargo did.

[00:07:01] Speaker 06:
It's what you did.

[00:07:02] Speaker 06:
That's the point.

[00:07:03] Speaker 06:
So if you could address that, I'd be grateful.

[00:07:06] Speaker 04:
Well, there is actually no question that the funds of the tender for payment was received by the servicer.

[00:07:14] Speaker 06:
Well, I will interrupt you again to say Judge Collins seemed to believe that that was not true and that that assertion was, should we say, not well taken.

[00:07:23] Speaker 06:
So why was that a mistake?

[00:07:26] Speaker 04:
Well, are you saying that the servicer lie in the statement?

[00:07:30] Speaker 04:
Because they send a monthly statement of the account, and the statement clearly show that there's credit to the account.

[00:07:39] Speaker 06:
Well, can I ask you, are you saying that you paid somebody $1.1 million, and therefore there's no longer any debt?

[00:07:45] Speaker 04:
Yes, we have tender of $1.1 million.

[00:07:49] Speaker 06:
Okay, Judge Collins didn't seem to think that was true, so if you want to suggest, I'm sorry, go ahead.

[00:07:54] Speaker 05:
What do you mean by tender?

[00:07:56] Speaker 05:
You're using that word carefully.

[00:07:57] Speaker 05:
What does tender mean in your mind?

[00:08:01] Speaker 04:
Tender is basically we tender a negotiable instrument payable to Mr. Cooper, who is the servicer.

[00:08:15] Speaker 05:
A negotiable instrument, was that a check?

[00:08:17] Speaker 05:
What kind of negotiable instrument?

[00:08:19] Speaker 04:
I know it's not a check.

[00:08:22] Speaker 05:
What was it?

[00:08:22] Speaker 04:
It's a negotiable instrument.

[00:08:24] Speaker 04:
You can call that a draft.

[00:08:27] Speaker 05:
A draft drawn on whom?

[00:08:31] Speaker 04:
Well, because that particular drop wasn't in any of the records, and there wasn't anything that we can even talk about because it's not in the record.

[00:08:43] Speaker 04:
In this case, it's not in the record anywhere.

[00:08:46] Speaker 01:
It would have been useful for the bankruptcy judge to see that you paid it off.

[00:08:50] Speaker 01:
You say you've tendered money, and you tendered a negotiable instrument.

[00:08:54] Speaker 01:
Was that negotiable instrument negotiated?

[00:08:58] Speaker 04:
Yes, that's what I'm talking about.

[00:09:00] Speaker 01:
But you say you actually paid, not just gave paper, but the paper was in fact negotiated and paid.

[00:09:08] Speaker 01:
Why didn't you give that information to the bankruptcy court?

[00:09:12] Speaker 04:
That information is in the statement provided by the servicer.

[00:09:18] Speaker 04:
Well, okay, the servicer... Their mom being credited with the money that they have received.

[00:09:24] Speaker 01:
Okay, but did that credit, is that credit tied to your negotiable instrument, or is that credit tied to some... Correct.

[00:09:31] Speaker 01:
No, is it, or is it tied to some other bank purchasing the loan?

[00:09:35] Speaker 04:
No, it's tied to the negotiable instrument.

[00:09:38] Speaker 01:
OK, so funds came out of your accounts, and the negotiable instrument was negotiated.

[00:09:45] Speaker 01:
So funds came from you, actual funds, not just paper.

[00:09:50] Speaker 04:
Well, they credit the account.

[00:09:52] Speaker 04:
That's the proof, because that's the only thing that we can rely on.

[00:09:55] Speaker 04:
Because right now, the only thing is the statement that is on the record.

[00:10:04] Speaker 04:
And it shows that it's credited to the account.

[00:10:08] Speaker 04:
And then you can look at the statement that provided in the proof of claim.

[00:10:14] Speaker 04:
Actually, you can see the credit going in on January 26th and on January 31st.

[00:10:21] Speaker 04:
You can see entries posed as pay off to principal, pay off to interest, amount credit to ASCRO, et cetera, et cetera, et cetera.

[00:10:31] Speaker 04:
So yes, they negotiated the instrument.

[00:10:33] Speaker 04:
There's no question about that.

[00:10:37] Speaker 06:
OK, you're closing in on your five minutes.

[00:10:40] Speaker 06:
If this is a natural place to pause, that's fine.

[00:10:42] Speaker 06:
And we can hear from the appellees, and you can pick up for rebuttal.

[00:10:45] Speaker 06:
Is that OK?

[00:10:45] Speaker 06:
Sure.

[00:10:46] Speaker 06:
OK, thank you.

[00:10:47] Speaker 06:
OK, so how do the appellees want to divvy this up?

[00:10:52] Speaker 03:
Yes, Your Honor, I would like to go first, and then.

[00:10:56] Speaker 06:
Go ahead and make your appearance.

[00:10:58] Speaker 03:
Yes, this is Ross Maumey for Trustee Edward Maney.

[00:11:00] Speaker 03:
OK.

[00:11:01] Speaker 03:
And I'd like to go first, and I'd like to reserve at least five minutes for Mr. McDonald.

[00:11:06] Speaker 06:
OK, go ahead.

[00:11:08] Speaker 03:
All right, thank you.

[00:11:09] Speaker 03:
Thank you, Your Honors.

[00:11:10] Speaker 03:
I may please the court.

[00:11:12] Speaker 03:
Before we reach the merits of this case, it's necessary first to argue the mootness of this appeal.

[00:11:18] Speaker 06:
Well, let me ask you a quick question right away.

[00:11:20] Speaker 06:
Why is the dismissal moot?

[00:11:23] Speaker 06:
I mean, she may have lost the house as a legal matter.

[00:11:26] Speaker 06:
She's still living there.

[00:11:28] Speaker 06:
And if the case were wrongfully dismissed, couldn't she pursue some kind of bankruptcy case and get some kind of relief?

[00:11:37] Speaker 06:
Certainly, there... I mean, the mootness is, does the court have the ability to rectify a problem and give the moving party some relief?

[00:11:47] Speaker 06:
I mean, how can you tell me that she couldn't get any relief or if we agree with her that the case shouldn't have been dismissed?

[00:11:53] Speaker 03:
Well, Your Honor, it's trustee's position, the appellee trustee's position that the three bankruptcy cases that were filed had no other purpose than to stall and delay the foreclosure of the real property, and that has happened.

[00:12:08] Speaker 03:
Furthermore, the debtors are, it's not to say that there could be no relief from a bankruptcy, but the relief that they're after is simply not possible anymore.

[00:12:18] Speaker 06:
Well, that's if they want to keep the house, that may be true, but they're entitled to other relief, aren't they?

[00:12:25] Speaker 06:
OK, so again, tell me how this is moot as a matter of dismissal.

[00:12:31] Speaker 03:
Well, Your Honor, we're basing that argument on the debtor's purpose behind filing the case, a purpose that Judge Collins noted on the record at the hearing on the motion to dismiss, that this case was filed as a... Well, that's a reason to dismiss the case.

[00:12:51] Speaker 06:
It doesn't mean that if we somehow didn't agree with him, the fact that she's legally lost the house doesn't mean she couldn't potentially get a discharge, correct?

[00:13:02] Speaker 06:
If she could get a discharge, how in God's name is this moot?

[00:13:04] Speaker 01:
Yeah.

[00:13:05] Speaker 01:
So you could move on, though, on the mootness piece is that you have other arguments, I assume.

[00:13:09] Speaker 01:
Yeah.

[00:13:10] Speaker 01:
Let's hear the other arguments.

[00:13:11] Speaker 01:
And I'm really interested in hearing about the trustee asked for a one-year bar.

[00:13:17] Speaker 01:
The bar that was actually entered was an in rem bar.

[00:13:23] Speaker 01:
Did parties know that that would be a possibility?

[00:13:30] Speaker 03:
Yes, thank you, Your Honor.

[00:13:31] Speaker 03:
I'm happy to answer that question.

[00:13:32] Speaker 03:
So the request that the Trustee made was a bar to refiling for one year for Ms.

[00:13:42] Speaker 03:
Ramzol as well as her husband and anyone with an ownership interest in the property of 50 Bronco Drive.

[00:13:49] Speaker 03:
The bankruptcy judge, instead of granting that requested relief, granted a lesser

[00:14:00] Speaker 03:
I would like to note that the motion to dismiss the case requested a a stronger, requested a more, um, a more, um, a more, um, a more, um, a more, um, a more, um, a more, um, a more, um, a more, um, a more, um,

[00:14:25] Speaker 03:
a harsher remedy than what was granted by the court, and Mr. Ramzell was a noticed party on the motion to dismiss.

[00:14:32] Speaker 03:
So the parties received notice in the trustee's motion to dismiss of that relief being sought.

[00:14:40] Speaker 05:
When you say he was a noticed party, how was Mr. Ramzell given notice?

[00:14:45] Speaker 03:
He was mailed a copy of the motion to dismiss.

[00:14:50] Speaker 03:
He was mailed his own separate copy to the same address as Mrs. Ramzell, but he was listed on the certificate of service and received his own copy.

[00:14:59] Speaker 03:
And it was made clear in that motion that he was served, that a remedy was being sought that would bar him from filing bankruptcy for one year.

[00:15:08] Speaker 03:
So for the appellant to argue that she was blindsided by this

[00:15:14] Speaker 03:
the stay relief that was ultimately granted, I disagree with that.

[00:15:19] Speaker 03:
I think that the remedy was being sought was much more severe than what was actually dealt by the bankruptcy court.

[00:15:26] Speaker 03:
And I think the parties had fair notice that some kind of bar to further delay a foreclosure was coming.

[00:15:38] Speaker 05:
Well, it's a little... One thing I can... No, Judge Rush, you go ahead.

[00:15:41] Speaker 05:
I was going to say, one thing that concerns me about the judge's ruling is he said, and I think you probably disagree with him, that there wasn't adequate notice to Mr. Ramsell, so he wasn't going to give an order targeted at Mr. Ramsell.

[00:15:53] Speaker 05:
But then he entered an in rem order, which is presumably targeted at Mr. Ramsell and everybody else.

[00:15:59] Speaker 05:
So there's little inconsistency there.

[00:16:02] Speaker 05:
If there wasn't enough notice for a targeted order, how could there have been enough notice for a much broader order?

[00:16:09] Speaker 03:
Certainly, I can see the court's concern there.

[00:16:15] Speaker 03:
I would just have to rely on, as I think the bankruptcy judge relied on, Section 105 brought authority to fashion a remedy that suits the... Well, that goes to the court's equitable power to do something.

[00:16:29] Speaker 06:
It doesn't address the question of whether people knew what the court was possibly going to do.

[00:16:34] Speaker 06:
Those are just two different questions.

[00:16:36] Speaker 06:
I mean, 105 is a remedies issue, right?

[00:16:39] Speaker 06:
It's not a notice issue.

[00:16:41] Speaker 06:
Now, what I think I'm hearing you say is that with this greater includes the lesser is a notion that if there was an error in the relief from stay, it's kind of harmless because, hey, he was dismissing the case anyway.

[00:16:54] Speaker 06:
And what I hear in the second piece, I think, is, well, if we had grounds to get a dismissal in any event, the same grounds maybe would have supported 362D4.

[00:17:06] Speaker 06:
But you didn't tell anybody until the hearing that that's where you were going.

[00:17:10] Speaker 06:
So I mean, I think we, I'm just going to echo Judge Farris's concerns here.

[00:17:15] Speaker 06:
That it just doesn't, we're not seeing where that's fair play to the debtor and Mr. Ramselle.

[00:17:22] Speaker 06:
So help us out with that part.

[00:17:25] Speaker 03:
Well, again, the the trustee gave all parties.

[00:17:31] Speaker 03:
Mr. Ramselle.

[00:17:33] Speaker 01:
And mrs. Ramsell fair notice of the relief ultimately that was granted I understand that well, let me ask you a question you say all parties and I was to make sure here I've looked you've looked at the schedules and You've probably looked at your title reports and you're saying And you said and everyone else that has an interest in the property got notice it so the everyone else is there anyone else other than

[00:18:00] Speaker 01:
Ms.

[00:18:01] Speaker 01:
Ramselle or Mr. Ramselle and the secured creditor?

[00:18:06] Speaker 03:
I apologize, Your Honor.

[00:18:07] Speaker 03:
I probably misspoke there.

[00:18:09] Speaker 03:
What I meant to say was

[00:18:11] Speaker 03:
the parties that we're aware of that have an interest in the property, which would be the appellant, Mrs. Ramsell, and her spouse, Mr. Ramsell.

[00:18:20] Speaker 03:
Those are the only parties that I'm aware of that have claimed an ownership interest in the property.

[00:18:25] Speaker 03:
And so those were the parties that were noticed of the motion to dismiss.

[00:18:30] Speaker 03:
And I think that the relief sought in the motion was clear and that the ultimate relief granted was

[00:18:40] Speaker 03:
essentially have the same impact as that relief that was requested would have had?

[00:18:49] Speaker 06:
Well, can I raise a related issue?

[00:18:53] Speaker 06:
If I remember the transcript,

[00:18:55] Speaker 06:
I believe it was the bankruptcy court that said, gee, you know, you could kind of get there if this were in rem relief under relief from stay.

[00:19:03] Speaker 06:
I mean, it was the bankruptcy court who did that sua sponte, right?

[00:19:06] Speaker 06:
So there was no notice to anybody before the hearing.

[00:19:09] Speaker 06:
It was the bankruptcy court's idea that that might be a way to achieve your goal, and it might be permissible.

[00:19:15] Speaker 06:
So can you want to respond to the notion that maybe doing that sua sponte was a mistake?

[00:19:23] Speaker 06:
as opposed to having a party actually ask for it, even at the hearing, which doesn't seem to have happened?

[00:19:31] Speaker 03:
Well, I don't believe that that was necessarily a mistake, Your Honor.

[00:19:37] Speaker 03:
I do agree that that was a suicide of Judge Collins.

[00:19:42] Speaker 06:
Okay.

[00:19:43] Speaker 06:
How come it wasn't a mistake?

[00:19:45] Speaker 03:
Well, again, because I apologize for being repetitive, but I think that fair notice was given in the motion to dismiss.

[00:19:57] Speaker 06:
Well, there can't be any fair notice that the judge is going to come up with a different theory, can there?

[00:20:04] Speaker 05:
I suppose not.

[00:20:07] Speaker 06:
OK.

[00:20:08] Speaker 05:
I think your argument before was it sort of a lesser included remedy.

[00:20:11] Speaker 05:
Yeah.

[00:20:12] Speaker 05:
Correct.

[00:20:19] Speaker 03:
So just again, on the merits of this case, you know, a bad faith dismissal of the bankruptcy is within the bankruptcy court's discretion, and the finding of bad faith is reviewed only for clear error.

[00:20:34] Speaker 03:
The bankruptcy court properly dismissed this case.

[00:20:38] Speaker 03:
This is the third case in a series of cases that were largely identical to one another.

[00:20:43] Speaker 03:
Bad faith was based on the debtor's refusal to acknowledge a very serious and very significant mortgage debt with very significant arrears rather than propose to repay that or address that mortgage in some way through a legitimate reorganization.

[00:20:58] Speaker 03:
Instead, the appellant argues that that was discharged by the tender of what I can only characterize as a fake instrument.

[00:21:08] Speaker 03:
and the appellant continues to make those arguments in the reply brief and oral argument today.

[00:21:15] Speaker 03:
But unless there are any additional questions for me, I'd like to reserve the rest of my time for Mr. McDonald.

[00:21:21] Speaker 06:
I'm all set.

[00:21:22] Speaker 06:
Okay.

[00:21:23] Speaker 06:
Thank you.

[00:21:23] Speaker 06:
Thank you very much.

[00:21:26] Speaker 02:
May it please the court, Leonard McDonald, appearing on behalf of Appalachian Wells Fargo Bank, N.A.

[00:21:32] Speaker 02:
And, Your Honors, Mr. Mumey has addressed your questions.

[00:21:36] Speaker 02:
It was his motion at the bankruptcy court level.

[00:21:41] Speaker 02:
As I indicated in my answering briefs, my concerns address the allegations of the invalidity of the Deed of Trust raised by the appellant.

[00:21:54] Speaker 02:
I'm prepared to answer any questions.

[00:21:56] Speaker 02:
I know you've read the briefs, my positions regarding the fact that 33811C prevents any further inquiry into these matters.

[00:22:11] Speaker 02:
With that, I'll pause.

[00:22:13] Speaker 06:
Give me that citation again.

[00:22:15] Speaker 06:
What prevents any further inquiry?

[00:22:17] Speaker 02:
Your Honor, it's ARS 33A11C.

[00:22:19] Speaker 06:
OK, that's the state law concerning?

[00:22:23] Speaker 02:
That's correct.

[00:22:24] Speaker 02:
OK, gotcha.

[00:22:25] Speaker 02:
And the legislature came to the conclusion that there's obviously a state interest in the finality of trustees' sales, unless Ms.

[00:22:39] Speaker 02:
Ramsell

[00:22:40] Speaker 02:
obtained a TRO 5 p.m.

[00:22:43] Speaker 02:
the day prior to the sale then if we go to sale which we did then she's prevented and she's waived any of those claims well that's exactly what's happened here can I would note to the I'm sorry

[00:22:56] Speaker 06:
No, that's OK.

[00:22:57] Speaker 06:
I have a follow-up question for you.

[00:23:00] Speaker 06:
And I'm glad you raised the Arizona statutes, because that's exactly what I'm going to need your help on.

[00:23:06] Speaker 06:
In California, if you're familiar with the In re Pearl case, what the Ninth Circuit has told us is their view of California law is that there's a point at which the debtor no longer has a cognizable, protectable interest that the automatic stay would cover.

[00:23:21] Speaker 06:
And that happens when there's been a legal transfer of the property,

[00:23:25] Speaker 06:
but also when appropriate steps are taken to do everything a state court can do to basically evict the debtor from the property.

[00:23:33] Speaker 06:
And the fact that the debtor happens still to be there is not sufficient for protection.

[00:23:38] Speaker 06:
So I'm curious if Arizona basically has the same rule that there is such a thing as a possessory right

[00:23:45] Speaker 06:
But at some point under Arizona law, that loses any value.

[00:23:51] Speaker 06:
Because the court, for example, in California, it would be a writ of possession and everything one would need to do to actually accomplish the eviction except actually evict the person.

[00:24:02] Speaker 06:
So is there an analog to that in Arizona law?

[00:24:04] Speaker 06:
So you'd argue that the debtor really doesn't have an interest here anymore of any kind?

[00:24:09] Speaker 02:
I would, Your Honor.

[00:24:11] Speaker 02:
I'm not familiar with the California case.

[00:24:13] Speaker 02:
I was not aware until just a few moments ago.

[00:24:16] Speaker 02:
She's still living in the property.

[00:24:17] Speaker 02:
Again, this property sold third party on March 21st, and so my file in that regard has been closed.

[00:24:28] Speaker 06:
OK, so you don't know, for example, what they've done.

[00:24:30] Speaker 06:
If there's something like what we'd call an unlawful detainer, actually, you don't know if there's any such thing going on now.

[00:24:35] Speaker 02:
I just don't.

[00:24:37] Speaker 02:
I'm very familiar with the eviction laws, and it's a possessory interest only, and there are no

[00:24:44] Speaker 06:
Let me apologize for digressing that.

[00:24:49] Speaker 01:
Mr. McDonald, you're talking about Arizona law and whether termination of an interest or waiver of an interest would apply to the debtors or to Ms.

[00:25:00] Speaker 01:
Ramsell and her husband.

[00:25:03] Speaker 01:
If there is any other party that had an interest in the property junior to your client's deed of trust, would those also be terminated or waived as a result of the foreclosure sale?

[00:25:14] Speaker 02:
They would, Your Honor, because all parties are given notice of the trustee's sale.

[00:25:20] Speaker 02:
They fall under the umbrella of the statute.

[00:25:22] Speaker 02:
And let's say a junior lienholder in a hypothetical believes, well, wait, I'm in first position.

[00:25:27] Speaker 02:
You're showing me a second.

[00:25:31] Speaker 02:
I need to stop the sale.

[00:25:33] Speaker 02:
Well, they have to stop that sale by the entry of a temporary restraining order.

[00:25:38] Speaker 02:
no later than 5 p.m.

[00:25:39] Speaker 02:
prior to the date of sale, or they've waived their defenses.

[00:25:42] Speaker 01:
It may not matter if it's an in rem or in personam situation here because there are no other in rem interests that remain in the property.

[00:25:52] Speaker 01:
And the only one that Judge Lafferty was talking about was the possible possessory interest of the Ramzels.

[00:25:59] Speaker 01:
But there's no other interested party that would have an in rem right.

[00:26:05] Speaker 02:
That's correct, Judge.

[00:26:09] Speaker 06:
Okay, I think we're at the end of the allotted time, so unless somebody else has a question, we'll go back to Ms.

[00:26:17] Speaker 06:
Ramzell.

[00:26:20] Speaker 04:
Okay, first of all, I have to say that we did not discover that Wells Fargo have sold the trust business until after my first bankruptcy.

[00:26:29] Speaker 04:
So Mr. Money is incorrect saying that all three bankruptcies are the same.

[00:26:34] Speaker 04:
We did not discover it until we received a letter from ComputerShare saying that they are the owner of the loan and the deed of trust.

[00:26:44] Speaker 04:
And also from later on from the servicer that

[00:26:48] Speaker 04:
It's not Wells Fargo who is the holder of due cost of the loan and the deed of trust.

[00:26:54] Speaker 04:
And in terms of interest, we still have equitable interest, a secure interest to the property.

[00:27:02] Speaker 04:
And the secure interest is listed in the schedules as well as the proof of claim five dash one.

[00:27:07] Speaker 04:
So the party who bought the property is given notice of the secure interest.

[00:27:13] Speaker 04:
So when they bought the property with all the liens and claims against it,

[00:27:17] Speaker 04:
So even though there is a foreclosure sale, we still have standing.

[00:27:23] Speaker 01:
So you have standing as a result of a lien?

[00:27:27] Speaker 04:
Of the security interest.

[00:27:28] Speaker 01:
Okay, the security interest.

[00:27:30] Speaker 01:
Is this one that was filed after the deed of trust that was originally granted to Bank of America mortgage securities?

[00:27:42] Speaker 04:
Well, the security interest actually goes back to when we first purchased the property that we already have put in the security deposit and all that.

[00:27:54] Speaker 04:
All those are all prior to their lien.

[00:27:58] Speaker 01:
So we are... Who's the holder of the security interest?

[00:28:03] Speaker 04:
Me and my husband.

[00:28:05] Speaker 01:
Okay.

[00:28:05] Speaker 01:
But you granted yourselves a security interest in your home?

[00:28:11] Speaker 04:
Yeah.

[00:28:12] Speaker 01:
And you granted that security interest after you granted a security interest to the first mortgage holder, Wells Fargo Bank.

[00:28:27] Speaker 04:
No, we did not grant it to them at all.

[00:28:30] Speaker 04:
We still hold the secure interest.

[00:28:32] Speaker 04:
We are still prior to them because our lien started with before we even have a mortgage.

[00:28:39] Speaker 01:
When we purchased the property- Did you own the property before you had the mortgage or did you- Yes, correct.

[00:28:44] Speaker 04:
We owned the property before we had the mortgage.

[00:28:47] Speaker 01:
This was not a purchase money financing transaction?

[00:28:50] Speaker 04:
No, it's a refi.

[00:28:51] Speaker 04:
Actually, several times refi.

[00:28:53] Speaker 04:
So we own the property way before Wells Fargo come into the picture or Bank of America come into the picture.

[00:28:59] Speaker 04:
So we are prior to them, definitely.

[00:29:01] Speaker 01:
So the owners of the property granted a security interest to themselves?

[00:29:06] Speaker 04:
Correct.

[00:29:08] Speaker 06:
Is that, there was litigation prior to the bankruptcy in the Arizona State Courts, and at least from what I've reviewed,

[00:29:18] Speaker 06:
Looks like the Arizona trial court and the Arizona Court of Appeal determined that whatever you claim those interests to be, they were of no force and effect whatsoever.

[00:29:27] Speaker 04:
Is that correct?

[00:29:28] Speaker 04:
They have not ruined any of those.

[00:29:31] Speaker 06:
Okay.

[00:29:32] Speaker 06:
Well, that's not the way I read it and certainly not the way Judge Collins read it, so you better tell us why that was a mistake if you're going to take that position.

[00:29:40] Speaker 04:
Well, first of all, that wasn't even brought into the picture about the security interest.

[00:29:45] Speaker 04:
It was never litigated in state court.

[00:29:49] Speaker 04:
Actually, the first time is that when I put into my first bankruptcy and the first one was dismissed, but it was never ruled against and it's still

[00:30:00] Speaker 04:
in there and we have a proof of claim filed on it.

[00:30:04] Speaker 04:
It's never ruled against by any judge in any of the bankruptcy court.

[00:30:08] Speaker 04:
Not in my case, not in my husband's case, not in this case.

[00:30:15] Speaker 04:
So that was misinformation that somebody said.

[00:30:20] Speaker 05:
But the Arizona Appellate Court said, this is back in 2021, that Wells Fargo's lien on the property is superior to your interest and affirmed the foreclosure of the Wells Fargo, then Wells Fargo mortgage.

[00:30:36] Speaker 05:
That's a state court ruling, right?

[00:30:38] Speaker 04:
That is very interesting because at that time I was still in my first bankruptcy and I have no idea why the state court would have jurisdiction to even make that claim.

[00:30:51] Speaker 04:
And if you look at that, Wells Fargo filed to remove the notice that I filed into the county record.

[00:30:59] Speaker 04:
It's not removing the lien, it's only removing the notice.

[00:31:02] Speaker 05:
Because I'm going to stop you because the record indicates that the Arizona Court of Appeals ruled in November of 2021 and you filed your first bankruptcy in January 2022.

[00:31:13] Speaker 04:
And it went into appeal.

[00:31:19] Speaker 05:
You further appealed the Arizona Appellate Court's order?

[00:31:22] Speaker 04:
Yeah.

[00:31:24] Speaker 04:
Yeah.

[00:31:26] Speaker 04:
And basically, you know, we're still working on that one.

[00:31:30] Speaker 04:
It's not done.

[00:31:31] Speaker 04:
There's no ruling about the lien being superior to that.

[00:31:35] Speaker 01:
The only thing that is superior... The order that you're appealing has never been stayed.

[00:31:40] Speaker 01:
Is that correct?

[00:31:44] Speaker 04:
Ask that question again.

[00:31:45] Speaker 04:
Sorry.

[00:31:45] Speaker 04:
I was looking at the clock.

[00:31:47] Speaker 01:
There's an appeal of, you have an appeal of the Arizona ruling, state court appeal, but that appeal of that state court original judgment or order, that original order from the trial court in Arizona, that's never been stayed, is that correct?

[00:32:07] Speaker 04:
Never been stayed meaning

[00:32:11] Speaker 01:
Did you ever ask for that a motion to stay the effect of the trial court order in Arizona?

[00:32:26] Speaker 04:
I don't really understand the questions because when I go to the appeal, the appeal didn't come in when I was in bankruptcy under automatic stay.

[00:32:40] Speaker 06:
Okay.

[00:32:41] Speaker 04:
So do I still have to ask for a stay when I'm in an automatic state?

[00:32:47] Speaker 06:
Well, if you have a bankruptcy case, no.

[00:32:50] Speaker 06:
But that's the problem, is that Judge Collins dismissed the case and barred you for a year.

[00:32:56] Speaker 06:
Okay, does anybody else have a question?

[00:32:59] Speaker 06:
Judge Farris, do you look quizzical?

[00:33:00] Speaker 06:
I do not.

[00:33:01] Speaker 01:
No?

[00:33:01] Speaker 01:
No, thank you.

[00:33:01] Speaker 06:
Judge Corbett?

[00:33:02] Speaker 06:
No.

[00:33:03] Speaker 06:
Okay, thank you very much for your good arguments.

[00:33:05] Speaker 06:
The matter is submitted and we'll get you a written decision as soon as we can.

[00:33:08] Speaker 06:
Thank you very much.

[00:33:09] Speaker 02:
Thank you, Your Honor.

[00:33:10] Speaker 00:
Thank you.

[00:33:10] Speaker 06:
Okay, let's call our third matter, please.