Saturday, April 25, 2015

Alleged Use Of Overly Restrictive Land Use Regulations/Zoning Ordinances Preventing Group Homes For Developmentally Disabled From Operating In Residential Areas At Issue In HUD Fair Housing Complaint Filed Against Village Of Bloomingdale, Illinois

From a recent press release from Little City Foundation & HOPE Fair Housing Center:
  • Local organizations, Little City Foundation and HOPE Fair Housing Center, have filed a federal civil rights administrative complaint against the Village of Bloomingdale, Illinois with HUD’s Office of Fair Housing & Equal Opportunity. Joined in the complaint are Bloomingdale homeowners who lost an opportunity to sell their home due to the Village of Bloomingdale’s actions.

    This complaint is part of HOPE’s continuing effort to ensure compliance with civil rights laws requiring states and municipalities to end discrimination against, and unnecessary segregation of, persons with disabilities.

    The complaint alleges that Bloomingdale has impermissibly restricted group homes for people with disabilities. Under Bloomingdale’s zoning code, group homes (which are licensed by the state) are not permitted uses in any zoning district within the village, and are allowed as special uses in business zones only. Their ability to operate in residential zones is restricted, and there is no formal procedure set in place for a group home for persons with disabilities to seek an accommodation to locate in a residential zone.

    As a result of Bloomingdale’s restrictive zoning ordinances, Little City Foundation was prevented from operating a state-licensed “Community-Integrated Living Arrangement” (CILA). Little City had entered into a contract to purchase a home in Bloomingdale. Little City intended to purchase the home to house eight adult, male residents with developmental cognitive disabilities and two non-residential staff persons providing 24-hour supervision. Little City’s application was opposed, however, by the Village Planning Commission, and it was ultimately rejected by the Village Board of Trustees (Village Board Meeting, June 9, 2014).

    The complainants seek an order preventing the village from enforcing its laws in a way that unlawfully discriminates on the basis of disability, and prohibiting the village from failing to make reasonable accommodations. They also seek monetary damages to compensate victims.

    “It has been more than 25 years since the Fair Housing Act was amended to provide equal opportunities for persons with disabilities,” said Anne Houghtaling, Executive Director of HOPE Fair Housing Center. “The comments made by Planning Commission members are disappointing and surprising in this day and age. Discrimination is illegal and violators of the law must be held accountable.”

    Bloomingdale’s zoning ordinance restricts the number of unrelated persons who can live together in a single family detached dwelling in a residential zone to no more than three unrelated persons. Bloomingdale’s ordinance does not allow CILAs or group homes of more than three unrelated persons to locate in residential zones as either a permissive or special use. In fact, group homes with more than three persons – which of course are virtually all group homes for people with disabilities – cannot locate, as a matter of right, anywhere in the Village of Bloomingdale. They are allowed as special uses in business zones only.

    According to Shawn Jeffers, Executive Director of Little City Foundation, “As a leading organization serving individuals with disabilities, it is our obligation and responsibility to be at the forefront, advocating for not only what is right, but for what is law. Ordinances designed to place unnecessary restrictions, obstacles or barriers on the right of people with disabilities to live in the community must be brought to full moral and legal compliance.”(1)

    Bloomingdale lacks a formal procedure, such as a special use or variance procedure that can be followed when a group home for persons with disabilities desires a reasonable accommodation in its zoning ordinance to allow the group home to locate in its residential zone under the Fair Housing Act.

    Little City Foundation, HOPE Fair Housing and the Bloomingdale homeowners are represented by Relman, Dane, and Colfax PLLC, a civil rights law firm based in Washington, DC.(2)
Source: Bloomingdale Denies Persons with Disabilities Right to Live in Village (Local Organizations File Federal Civil Rights Administrative Complaint Against the Village of Bloomingdale, Illinois).

See Fair Housing Feds' Probe Triggered By HUD Complaint Filed By Legal Guardian For Intellectually Disabled Ward Leads To $80K Settlement With St. Peters In Suit Accusing City Of Discriminatory Zoning Practices for an earlier fair housing case resulting with the city of St. Peters, Missouri settling a discrimination lawsuit by having to fork over $80K and relax its zoning ordinances to permit group homes for the intellectually disabled.


(1) Olmstead v. L.C., 527 U.S. 581 (1999), is a United States Supreme Court case regarding discrimination against people with mental disabilities. The Supreme Court held that under the Americans with Disabilities Act, individuals with mental disabilities have the right to live in the community rather than in institutions if, in the words of the opinion of the Court, "the State's treatment professionals have determined that community placement is appropriate, the transfer from institutional care to a less restrictive setting is not opposed by the affected individual, and the placement can be reasonably accommodated, taking into account the resources available to the State and the needs of others with mental disabilities." (Reference: Wikipedia).

(2) About Little City Foundation

A private, non-profit corporation, organized under the laws of Illinois in 1959, Little City’s mission is to ensure that people with intellectual and developmental disabilities are provided with the best options and opportunities to live safely, work productively, explore creatively and learn continuously throughout their lifetime. More than a place with a mission, it is a vital and vibrant community with goals to continually make great strides to further enrich the lives of individuals with disabilities, advocate on their behalf and help them flourish.

About HOPE Fair Housing Center

Established in 1968, HOPE is the oldest fair housing center in Illinois. HOPE Fair Housing Center works to eliminate housing discrimination and to ensure equal opportunity for all people through leadership, education and outreach, public policy initiatives, advocacy, investigation of fair housing violations, and enforcement.

Relman, Dane & Colfax

Relman, Dane & Colfax (RDC) is a civil rights law firm based in Washington, D.C., with additional offices in Ohio and New Mexico. RDC litigates civil rights cases in the areas of housing, lending, employment, public accommodations, education, and police accountability.

Friday, April 24, 2015

Jury Slams Bankster w/ $2M Verdict On Behalf Of Illinois Homeowner For Violating RESPA, State Consumer Fraud & Deceptive Business Practices Act

From a press release issued by the law firm Sulaiman Law Group, Ltd.:
  • Alena Hammer secured a jury verdict against Residential Credit Solutions, Inc. (RCS), a national mortgage loan servicer headquartered in Fort Worth, Texas, for its breach of contract, violations of the Real Estate Settlement Procedures Act (RESPA), and violations of the unfairness and deception provisions of the Illinois Consumer Fraud and Deceptive Business Practices Act. All of Hammer's claims dealt with RCS's misconduct in handling and servicing the mortgage loan on Hammer's home in DuPage County, Illinois, where Hammer has resided for the last 27 years.

    Hammer's mortgage loan was serviced by AmTrust Bank (AmTrust) until AmTrust failed and was taken over by the FDIC in December 2009. In June 2010, Hammer entered into a loan modification agreement with the FDIC as receiver for AmTrust. Hammer's home mortgage loan was then transferred to RCS in August 2010. In September 2010, RCS began rejecting Hammer's monthly payments and refused to acknowledge the existence of the loan modification. RCS then proceeded to prosecute two separate foreclosure actions against Hammer, despite the fact that Hammer, still to this day, has tendered all of her monthly payments as required under the loan modification agreement. The first foreclosure case was dismissed in favor of Hammer and against RCS in March 2011.

    However, RCS continued to reject Hammer's payments and continued to deny the existence of the loan modification agreement; RCS filed a second foreclosure action against Hammer in September 2011 and prosecuted that case through December 2013. Hammer had complained of improper fees and costs assessed to her loan account, the attorney's fees and costs she incurred to defend two improper foreclosure proceedings, damages for mental anguish and emotional distress, and other damages that were incurred during the nearly three and a half year ordeal.

    The six (6) day federal trial concluded on April 20, 2015 in Chicago, Illinois at the Everett McKinley Dirksen United States Court House. The jury, after deliberating for approximately two hours, determined that RCS breached the loan modification agreement, violated RESPA for failing to adequately respond to Hammer's Qualified Written Request, and committed both unfair and deceptive acts in violation of the Illinois Consumer Fraud Act.

    Alena Hammer was awarded $500,000 in compensatory damages and $1,500,000 in punitive damages. Nicholas Heath Wooten, Esq., Ross Michael Zambon, Esq., and Mara Ann Baltabols, Esq. led the litigation team on behalf of Hammer. Each attorney is a student of the nationally renowned and esteemed North Carolina attorney, O. Max Gardner III, and each is a graduate of his highly acclaimed Consumer Bankruptcy and Litigation Boot Camps.(1)

    The outcome of this trial should come as good news to all consumers who have struggled with aggressive mortgage servicing tactics throughout the ongoing financial crisis. The litigation team was meticulous and methodical in its litigation approach, and was able to obtain a punitive damages award for Hammer and against RCS – an award that is meant to punish and deter future misconduct – under the Illinois Consumer Fraud Act.
Source: $2 Million Unanimous Jury Verdict ($2 million jury verdict obtained by Alena Hammer, a resident of DuPage County Illinois, and against Residential Credit Solutions, Inc. (RCS), a national mortgage loan servicer).

Thanks To Deontos for the heads-up on the jury verdict.

(1) See, generally, Bloomberg Business: Foreclosure Lawyers Go to Max’s Farm for Edge.

Thursday, April 23, 2015

Orange County DA Bags Real Estate Broker Trio, Charge Each w/ Six Felony Counts Of Grand Theft For Allegedly Running Loan Modification Racket, Ripping Off Homeowners Facing Foreclosure Out Of Thousand$ In Upfront Fees

From the Office of the Orange County, California District Attorney:
  • A real estate broker and two real estate agents who worked together have been charged with grand theft in a loan modification scheme. The Orange County District Attorney’s Office (OCDA) is seeking the public’s help identifying potential additional victims in this case.

    Michael Pelimiano Soriano, 45, Irvine, Agustin Navarra Alayon, 52, Canoga Park, and Joseph Anthony Q. Oliva, 50, San Jose, are each charged with six felony counts of grand theft and one felony count of collecting a foreclosure consultant unlawful advance fee. If convicted on all counts, they each face a maximum sentence of seven years in jail. Alayon and Soriano are out of custody on $29,500 bail and are scheduled to be arraigned tomorrow, April 16, 2015, at 8:30 a.m. in Department C-55, Central Justice Center, Santa Ana. Oliva remains at large.

    At the time of the crime, Soriano was a licensed real estate broker accused of owning and operating Cyberlink Diamond Group, LLC (Cyberlink) in Huntington Beach, without having the company legally licensed with the California Bureau of Real Estate (CALBRE). Soriano is accused of employing Ayalan and Oliva, both real estate agents, to work at Cyberlink as marketing representatives to solicit consumers and offer them loan modification and foreclosure rescue services.

    Between March 2011 and July 2011, Ayalan and Oliva are accused of contacting distressed homeowners and offering them loan modification services to save their homes. The defendants are also accused of advertising loan modification services by hosting seminars where marketing representatives sold these programs to homeowners.

    The defendants are accused of taking upfront fees from three clients, totaling $29,500 in loss. The defendants are accused of collecting these upfront fees from at least one victim, even though the victim’s house was in actual foreclosure.

    One of the victims in this case reported Soriano to CALBRE, who investigated this case. CALBRE revoked the defendants’ real estate agent licenses following the investigation.
Source: Real Estate Broker and Two Real Estate Agents Charged with Grand Theft in Loan Modification Scheme (OCDA is seeking the public’s help identifying potential additional victims in this case).

Wednesday, April 22, 2015

1600+ Unit NYC Co-op Association To Pay $85,000 To Two Residents In Settlement Of Fair Housing Suit Over Entitlement To Emotional Support Animals; Third Unit Owner's Complaint Fails, Gets 12 Months To Unload Allegedly Yappy, Violent Pooch Or Take A Hike As Neighbors' Complaints Sink Claim

In New York City, the New York Post reports:
  • Three mentally ill co-op owners got mixed results after help from US Attorney Preet Bharara in a long battle with their Lower East Side building’s management company to keep their service dogs.

    Under a settlement ironed out [] in Manhattan federal court, East River Housing Corp. agreed to pay co-op owners Amy Einsenberg and Steven Gilbert $55,000 and $30,000 each, respectively, and let them keep their service pets.

    However, Stephanie Aaron, 53, must either find a new place to live in one year or a new owner for her pooch after neighbors complained that her pet was too loud and violent.

    Bharara had filed suit against East River Housing alleging it was violating the Fair Housing Act by ordering people who rely on service pets to remove them or face eviction.

    He was able to convince a federal judge to issue temporary restraining orders blocking the evictions of the three co-op owners until the suit was resolved.

    East River attorney Bradley Silverbush said he believes the settlement was “fair and reasonable.”

    But Aaron must get rid of her dog, despite her claims, and those of her psychiatrist, that it helped her combat depression and anxiety after she took in the stray in 2012.
Source: Bharara helps two co-op owners keep service dogs.

For the lawsuit filed by the Feds, see USA v. East River Housing Corp.

Editor's Note: Apparently, the use of emotional support animals is also gaining in popularity among airline travelers. See Los Angeles Daily News: Dubious doctor letters turn airlines into petting zoos.

Tuesday, April 21, 2015

Suit: Town Approved Trailer Park Demolition & Rezoning Without Complying With State Law Requiring Assistance To Current Residents In Finding Replacement Housing; Action Seeks To Help 1,000 Mostly Poor, Elderly, Disabled Dwellers Dodge Unceremonious Boot

In Miami, Florida, The Real Deal (South Florida) reports:
  • Three residents of the Little Farm Trailer Park in El Portal are suing the village, as well as the property’s previous and current owners, to stop the demolition of the 14-acre mobile home lot near Biscayne Boulevard, The Real Deal has learned.

    The trailer park changed hands on Feb. 27 when Biscayne Park Acquisition Group, an affiliate of New York-based Madison Realty Capital, sold the 13.86-acre property for $14.25 million to Wealthy Delight, a Coral Gables-based company managed by Leo Wu.

    Calls and an email to Wealthy Delight’s Coral Gables lawyer Jordan Pascale were not returned. Madison Realty principal Brian Shatz, who is listed as Biscayne Park’s manager, and El Portal Village Manager Jason Walker declined comment because they had not read the lawsuit.

    According to the complaint filed this week in Miami, Barbara Falkinburg, Maria Palacio, and Marie Baptiste allege that El Portal officials violated state law by entering into a settlement on Feb. 6 with the buyer and seller to tear down the trailer park without first assisting the 1,000 mobile home residents find replacement housing.

    The sale was contingent on the settlement because El Portal had placed liens on the property due to $8.2 million in unpaid code violations dating back to 2006. The village also sued Biscayne Park in 2012. As part of the settlement, El Portal agreed to waive nearly all of the fines as long as Wealthy Delight razed the mobile homes. The new owner is being required to pay $575,000 to the village.

    Evian L. White, an attorney with Legal Services of Greater Miami(1) representing the three residents pro bono, said the village made no attempt to find new living accommodations to relocate the residents when it executed the settlement agreement.

    Florida law prohibits municipal and county governments from approving rezoning applications or from taking any other official action resulting in the relocation of mobile home residents without first determining that adequate mobile home parks or other suitable facilities exist for relocation.

    “Mobile home parks are the only form of non-subsidized affordable housing in Miami-Dade County,” White told TRD. “Florida law provides a process to protect residents when the government plays a part in shutting down a mobile home park. That process must be followed before Little Farm can be closed.”

    White said a majority of the Little Farm residents are poor, elderly, and disabled. For instance, Falkinburg is an 80-year-old retiree who moved into her trailer home 13 years ago with her 59-year-old son, who is wheelchair-bound due a stroke he suffered a decade ago. Sixty-year-old Palacio and her husband share a trailer with her sister-in-law. And Baptiste is a 67-year-old retired housekeeper.

    “We don’t know what the plans are for redevelopment of the park,” White said. “All the settlement states is that the park has to be shut down and the mobile homes be demolished within a year.”
Source: El Portal trailer park residents sue to stop wrecking ball (Wealthy Delight bought the 13.86-acre property for $14.25M in February).

See also, WTVJ-TV Channel 6: Residents Fighting to Stay in Miami-Dade Trailer Park.

Go here for some background on the Little Farm Trailer Park.

(1) Legal Services of Greater Miami is the largest provider of broad-based civil legal services for the poor in Miami-Dade and Monroe Counties in South Florida.

Monday, April 20, 2015

Massachusetts High Court: Mortgages Lacking Stated Maturity Date Are Subject To Five Year Statute Of Limitations Where Recorded Documents Contain Reference To The Term Of Underlying Debt; Court Ruling Renders Mortgages, Foreclosure Null & Void In Recent Case

The following is from an advisory from the law firm Nutter McClennen & Fish LLP:
  • [I]n Deutsche Bank National Trust Co. v. Fitchburg Capital, LLC, No. 11756, slip op. (Mass. April 15, 2015), the SJC considered whether mortgages that do not state a specific maturity date, but reference the term or maturity date of the underlying debt, are subject to the Obsolete Mortgage statute. The SJC held that references in mortgages to the dates and terms of the underlying debt make the mortgages subject to the 5-year, and not the 35-year, statute of limitations set forth in the [Massachusetts] Obsolete Mortgage statute.

    In this case, a lender purported to foreclose in 2012 on two mortgages from 1999 and 2002 for which the underlying debts were due in 2000 and 2003, respectively. Although neither mortgage stated a specific maturity date, each mortgage referenced the term of its underlying debt.

    The SJC held that, "because the scope of a mortgage is necessarily tied to the reach of the underlying obligation, considering the term or maturity date of the underlying obligation to be the term or maturity date of the mortgage comports with the common-law understanding of the words "mortgage' and 'note.'"

    The SJC also held that a dragnet clause in one of the mortgages (whereby the mortgage also secured "all other debts, covenants and agreements of or by the Mortgagor to or for the benefit of the Mortgagee now existing or hereafter accruing while this mortgage is still undischarged of record") was insufficient in this instance to save the mortgage from becoming obsolete since no additional debts were incurred subsequent to the original loan. The SJC acknowledged, however, that there might be some circumstances in which a dragnet clause could extend the term or maturity date of a mortgage.

Sunday, April 19, 2015

Cops Frog-March Two Landlords Into Criminal Court To Face Charges That They Used Baseball Bat/Sledgehammer-Wielding Wrecking Crews & Pit Bulls To Destroy Their Own Buildings & Intimidate Long-Time, Rent-Controlled Tenants In Campaign To Drive Them Out & Bring In Higher Paying Market Rate Renters; Brooklyn DA On Victimization: “Grand Larceny. [The Defendants] Stole The Value Of These Folks’ Homes!"

In Bushwick, Brooklyn, WPIX-TV Channel 11 reports:
  • Landlords Josh and Amrom “Aaron” Israel have been ranked among the city’s worst landlords by New York’s public advocate.

    On Thursday, however, they went from just being on a list of bad-faith landlords to being under arrest, accused of wrecking apartments they themselves own, in an attempt to force their tenants out. Those tenants on Thursday were rejoicing over seeing their landlords in handcuffs, but their plight as renters with the Israels is not over.

    PIX11 first encountered the two landlord cousins early last year. They ran from our cameras and used their scarves to cover their faces during an investigation into their alleged tenant intimidation practices.

    On Thursday, however, officers made sure that Joel and Aaron Israel were highly visible in front of cameras as Brooklyn district attorney’s office cops led the pair into a courtroom in handcuffs for their first appearance before a judge.

    The 15 criminal counts against them, ranging from burglary to grand larceny, were the result of the Israels’ apparently intentional destruction of whole bathrooms, walls and even floors in some of their own buildings, as well as the apparently intentional damage to boilers and other machinery necessary for comfortable living in other buildings they own. It was all allegedly an attempt to force rent controlled tenants out and bring much higher paying market rate tenants in.

    District Attorney Ken Thompson said at a news conference after the court appearance that the Israels did such things as hire a wrecking crew to come in to one tenant’s apartment while she was out at a doctor’s appointment, and remove all of her belongings and tear down walls and damage utilities in her apartment.

    “They were committing criminal acts,” said Thompson, citing, as an example, “Grand larceny. They stole the value of these folks’ homes.”

    Thompson added that the Israels’ arrest was meant to send a message, and not just to them. It was a point echoed by some housing advocates. “Other landlords, wake up,” said Father Edward Mason, a priest who has helped tenants of the Israels’ four buildings, “and see what’s happening here today!”

    Fellow affordable housing advocates, as well as the Israels’ tenants, said that the right thing is being done after years of fighting in civil court.

    “It was just hell,” said Catalina Hidalgo, who lives in one of the Israels’ properties in Greenpoint, Brooklyn. “But I can finally say that I’m just happy. Extremely happy.”

    However, in her building, 300 Nassau Avenue, and in other properties owned by the Israels, some hazardous, unlivable conditions are not yet repaired. In response to a question about the next phase of work in this fair housing case, District Attorney Thompson told PIX11 News that he sees a pursuit of the Israels’ alleged accomplices as the way to achieve further justice for their tenants.

    We need to know,” said Thompson, “who was actually walking around with sledgehammers and bats, walk around with pit bulls [intimidating residents]. We want to identify everyone who was part of this scheme.”

    Tenants like Hidalgo said that in her building, conditions were so bad that the city had to take over and do basic renovations. The Israels are also responsible for many of the repairs. Hidalgo said that she had been promised that her once badly damaged home will be habitable again, eventually.

    “They’re in the works of getting some plans drawn up. By Christmas, we’ll be back in our homes.”

    Joel and Aaron Israel could face up to 15 years in prison if found guilty of the burglary charge alone. Their attorney, Kevin Keating, said outside of court that the cousins’ arrest was unexpected, since they had for years cooperated in civil court regarding alleged housing code violations.

    “Why this has surfaced now is peculiar,” said Keating. “We’re going to fight this extensively.”

    Joel Israel was granted $50,000 bail, Aaron Israel’s bail was $25,000. As of Thursday evening, there was no record at the Department of Corrections of them having posted bail payments.
Source: ‘City’s worst landlords’ busted by Brooklyn DA for allegedly sabotaging tenants’ apartments.

For the Brooklyn District Attorney press release, see Alleged Unscrupulous Landlords Indicted For Unlawful Eviction Of Rent Stabilized Tenants and Filing False Documents In Connection With Residential Buildings in Bushwick, Greenpoint and Williamsburg (Defendants Face Up To 15 Years in Prison for Unlawfully Trying To Force Out Tenants In Rapidly Gentrifying North Brooklyn Neighborhoods).