89-Year Old Widow Dodges Foreclosure, Gets Mortgage-Free Home After Being Tricked Into Signing For $400K+ Loan; Scammer Believed To Have Fled Country

In San Mateo County, California, The Oakland Tribune reports:

• An 89-year-old Pacifica woman who was conned out of $600,000 by a contractor and faced foreclosure has won a lawsuit that prevents her eviction, an attorney said. As part of the settlement worked out Thursday in San Mateo County Superior Court, the lien on Pauline Reade's house was lifted and she won't have to repay a $420,000 loan that had been taken out on her property without her knowledge, said the woman's attorney, Niki Okcu, who took the case pro bono. Reade also won some compensation, though Okcu declined to provide details, saying the settlement was confidential.

• Reade sued Fetuu Tupoufutuna, a handyman who became her caretaker, as well as Deutsche Bank National Trust Co. and GMAC Mortgage, after she learned her home was going to be auctioned to repay a loan of which she had no knowledge. She later learned that Tupoufutuna had tricked her into signing the loan papers by telling her he needed her signature to get a permit to repair a backyard shed, attorneys said.(1)

• Okcu said Reade met Tupoufutuna sometime before 2006 when he was circulating in her neighborhood offering handyman services. He did some work on her house and then began to get involved in her finances. Reade is a widow, has no children and no family in the area. Tupoufutuna took out what was initially a $312,000 home equity loan on Reade's home in September 2006, attorneys said. He made some payments, but eventually stopped reimbursing the bank, attorneys said.

• During the same time, he had also stolen hundreds of thousands of dollars from the woman, Okcu said. Reade's first knowledge of the loan came in March 2009, when she got a letter saying that her home was to be sold at public auction.

• Reade told a neighbor what had happened and then the police. Okcu and Hope Nakamura of the Legal Aid Society of San Mateo County(2) filed suit to stop the foreclosure in April. San Mateo County prosecutors in March filed criminal charges against Tupoufutuna, but he is believed to have fled the country, Okcu said.

• "She is in her house," Okcu said. "Hopefully, she will be able to pick up the pieces of her life and move on."

Source: Pacifica woman wins lawsuit, keeps house after being conned.

(1) California has some pretty handy case law to support a case to void deeds, mortgages, and other land documents when unwitting property owners get tricked into signing paperwork that jeopardizes the title to their home through some type of equity refinancing ripoff where the victim seeks to establish that a purported conveyance is actually wholly void (ie. void ab initio, a legal nullity, etc.), and not merely voidable (ie. valid until successfully challenged), the distinctions being:

• the effect of such a challenge on the rights of 3rd party bona fide purchasers and encumbrancers/lenders, and
• the time frame within which such a challenge can be brought.

See generally, Schiavon v. Arnaudo Bros., 84 Cal. App. 4th 374; Cal.Rptr.2d 801 (Cal. App 6th Dist. 2000) (bold text is my emphasis, not in the original text):

• A deed is void if the grantor's signature is forged or if the grantor is unaware of the nature of what he or she is signing. (Erickson v. Bohne, supra, "130 Cal.App.2d at pp. 555-556.) A voidable deed, on the other hand, is one where the grantor is aware of what he or she is executing, but has been induced to do so through fraudulent misrepresentations. (Fallon v. Triangle Management Services, Inc. (1985) 169 Cal.App.3d 1103, 1106 [215 Cal.Rptr. 748].) The same rules apply to the reconveyance of the property interest under a deed of trust as to the conveyance of property by grant deed. (Wutzke v. Bill Reid Painting Service, Inc. (1984) 151 Cal.App.3d 36, 43 [198 Cal.Rptr. 418] (Wutzke).)

***

• Although the law protects innocent purchasers and encumbrancers, "that protection extends only to those who obtained good legal title. [84 Cal.App.4th 380] [Citations.] ... [A] forged document is void ab initio and constitutes a nullity; as such it cannot provide the basis for a superior title as against the original grantor." (Wutzke, supra, 151 Cal.App.3d at p. 43; see also cases cited ibid.)

See also, Unwinding An Abusive Or Fraudulent Real Estate Transaction? Determining If The Deed Is Void, Or Merely Voidable.

Go here for more on void vs. voidable transactions.

(2) The Legal Aid Society of San Mateo County is a non-profit, public interest law firm that provides free civil legal services to San Mateo County’s low-income residents.