In December 2008, Samuel and Courtney Adamson stopped making mortgage payments on their Utah home and they are still living in the house.
The mortgage was owned by Bank of America who turned foreclosure proceedings over to a subsidiary of theirs called Recon Trust. In January 2010 Recon Trust sold the Adamson’s home in a foreclosure sale to another one of Bank of America’s subsidiaries.
The Adamson’s continued to attempt to negotiate a new mortgage with Bank of America and refused to vacate their home. The new subsidiary owner then transferred the title of the home to Distressed Asset Solutions Fund I, a company located in San Diego. Distressed then filed a lawsuit against the Admansons in their efforts to evict them.
The Adamson’s fought the eviction lawsuit by claiming that the original foreclosure sale had violated Utah state law that states that only a Utah attorney or company are allowed to legally carry out a foreclosure selling. Bank of America argued against the Adamson’s charge stating they and Recon Trust were legally operating under Texas state law.
The question of which state’s laws apply have been a grey area as courts have ruled both ways in recent years. A year ago, the Utah State Supreme Court ruled that Utah state laws apply in cases like this and not the laws of others states. Bank of America has been involved in some of these other cases in Utah and has already stated that they will appeal the Utah Supreme Court’s ruling to the US Supreme Court.
Bank of America’s case was further weakened this past week when Fifth District Court Judge Jeffrey Wilcox ruled that in the Adamson case, Bank of America and Recon Trust both violated Utah state laws in their foreclosure on the Adamsons. Since the foreclosure was ruled illegal, the eviction order that followed cannot be enforced.
No announcement has yet been issued if Judge Wilcox’s ruling will be appealed or not. In the meantime, the Adamsons, who have still not made a mortgage payment or property taxes in nearly 6 years, are being allowed to remain in their home.
Had the Adamsons not been familiar with the Utah laws governing foreclosures, they would have been gone a long time ago. If you have undergone a foreclosure or are in the process of being foreclosed on, check your state laws, especially if you live in Utah.