"We are committed to: The highest ethical standards. Uncompromising honesty and integrity." —The Windermere Mission Statement "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." —Windermere CEO Geoff Wood's Public Affirmation
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Recent Case Update: Stipulation and Order for Dismissal
DEFENDANTS' OPPOSITION TO MOTION FOR SUMMARY JUDGMENT:
"Judd had told Mr. Shriner several times that his family had money and would help him out if he was unable to satisfy his obligations..."
PLAINTIFFS’ REPLY IN SUPPORT OF SUMMARY JUDGMENT MOTION:
"Defendants try to confuse the definition of a windfall."
(Above L to R) The Governing Persons of the Washington Loan Company: 1) Windermere Founder John W. Jacobi is listed as President of the Washington Loan Company; 2) Timothy Wissner, CFO of franchiser Windermere Services, and CFO of Windermere Solutions is listed as Washington Loan Company Vice President; 3) Kendra Vita, Manager of franchiser Windermere Services Company is listed as Secretary of the Washington Loan Company; 4) franchiser Windermere Services Company General Counsel, attorney Paul S. Drayna—WSBA #26636—is listed as Registered Agent of the Washington Loan Company; 5) Don Riley, Washington Loan Company manager; 6) Windermere Real Estate S.C.A. Redmond owner Craig Shriner; 7) Windermere Redmond SCA managing broker Aaron Shriner; 8) Windermere Redmond SCA agent Christopher Judd. The Washington Loan Company's business license states that its registered trade name is Windermere Real Estate / Eastlake.
Read the original Complaint in the case here. Defendants Washington Loan Company and Windermere Real Estate S.C.A. Redmond must be compelled by court to produce discovery.
IN THE SUPERIOR COURT OF THE STATE OF WASHINGTON
IN AND FOR THE COUNTY OF KING
FRED AND KATHLEEN REPASS,
Plaintiff,
v.
WINDERMRERE REAL ESTATE/S.C.A., INC.; CHRISTOPHER JUDD, a single man; WASHINGTON LOAN COMPANY, Inc., a Washington corporation; and ALISON A. HAIG, as trustee of subject of deed of trust,
Defendants.
NO. 09-2-46671-8 SEA
DEFENDANTS' OPPOSITION TO MOTION FOR SUMMARY JUDGMENT
This opposition memorandum is submitted by and on behalf of Defendants Windermere Real Estate/S.C.A., Inc. and Washington Loan Company.
1. INTRODUCTION
Plaintiffs ask this court to disregard a valid lien from their property. Plaintiffs do not contend that the deed of trust was not properly recorded or perfected. Indeed Plaintiffs admit that the "Windermere Deed of Trust" was properly recorded against the property. Motion for Summary Judgment ("MSJ") at 4, 11. 9-11. Rather, Plaintiffs contend that because the deed of trust was not cleared from title in their purchase of the property, that they are now entitled to avoid the encumbrance. In essence the Plaintiffs ask this court to remove the subject deed of trust from their property.
Plaintiffs have title insurance. Commonwealth Land Title Company of Puget Sound, LLC ("Commonwealth") issued title insurance to Plaintiffs in their purchase of the property. Commonwealth missed the subject deed of trust in its title examination. Exhibit 1, Declaration of David C. Daniel. Although Commonwealth learned shortly after closing of its error, it waited 6 months before notifying Plaintiffs (in September, 2008) that it had missed the subject deed of trust on title. In its letter to Plaintiffs, Commonwealth accepted responsibility for the missed deed of trust and assured Plaintiffs that they would be protected from any action taken by the lienholder. Exh. 2, Daniel Dec.
The named Plaintiffs in this action are Fred and Kathleen Repass. However Fred Repass testified under oath that this is not his lawsuit; it is Commonwealth's lawsuit.
A. I didn't file the lawsuit technically. They did. And because of the title policy, I understood that I had to go along with it. But what I was asking them to do is pay it off so I am out of the picture. They said, we don't have to do that. So here we are.
Exh. 3, Daniel Dec., Repass Deposition at 30-1.
This case is entirely being pursued by Commonwealth to avoid payment on Repasses' title claim for which Commonwealth has accepted responsibility. Plaintiffs ask this court to disavow the lien position of the subject deed of trust on the basis that the properly secured and perfected lienholder should not obtain an "unearned windfall". However, Plaintiffs fail to establish (a) any legal or equitable basis on which this court should order the cancellation of a valid lien, particularly on summary judgment, or (b) that any "unearned windfall" would actually result to the lienholder. Further, the remedy Plaintiffs seek in their motion is not equitable subrogation, inasmuch as they are not looking to be placed into the shoes of another. Rather, Plaintiffs are asking this court to subordinate the subject deed of trust to the Plaintiffs interest in the property.
Plaintiffs have not met their initial burden of proof necessary to shift the burden to the nonmoving party on summary judgment. They have not offered sufficient evidence that they are entitled to judgment as a matter of law. The caselaw on which they rely is not analogous to the case-at-hand, and they incorrectly state that the "only issue before the court has already been decided by the Washington State Supreme Court." MSJ at 8, 11. 20-1. Indeed the question at hand has never been answered by the Washington courts. Finally, the question of equitable subrogation, or subordination, is one that is entirely fact-driven. Although Plaintiffs clearly downplay the materiality of the facts, and the existence of any dispute over the facts, the truth of the matter is that there are significant factual disputes at hand on highly material issues.
Namely, the factual disputes herein include: (a) whether an unearned windfall would or could result to Defendants, and if so in what amount and how; (b) whether Defendants believed that they stood to gain from the sale of the Kirkland Home from Judd to Repass; (c) whether the facts here constitute a basis for equitable subrogation when Plaintiffs do not look to step into the shoes of another, but rather to take a superior position to a validly recorded and perfected deed of trust; and (d) that even though Plaintiffs admit they themselves were aware of the subject deed of trust prior to closing, they claim that Defendants willfully and knowingly acted in concert to allow the sale to close without the deed of trust being cleared, even though there is not a shred of evidence to support such a claim.
For the reasons set forth herein, Plaintiffs motion must fail.
II. STATEMENT OF FACTS
Washington Loan Company's ("WLC") primary purpose is to make bridge loans to Windermere clients and customers. An ordinary bridge loan is used to allow a Windermere client to buy a property without having yet sold their previous home. It is a short term loan in which the contract provides that repayment is due within 9 months or upon the sale of the person's previous home, whichever occurs first. The loan is secured by a lien against the previous home, and the homeowner is required to list that property for sale with the Windermere franchise through which the loan is originated. WLC requires that the Windermere franchise through which the loan is originated must guarantee repayment of the loan. Exh. 4, Daniel Dec., Riley Deposition at 16-7.
WLC and Windermere Real Estate/SCA, Inc. ("Windermere SCA") are not connected in any substantive way. WLC is wholly owned by John Jacobi. Windermere SCA is a Windermere franchise wholly-owned by Craig Shriner. Mr. Shriner and Windermere SCA do not have any financial interest or control over WLC. Declaration of Craig Shriner.
Defendant Chris Judd ("Judd") is an agent licensed with Windermere SCA. Judd, as a homeowner and not as an agent for a Windermere client, applied for a loan from WLC in the amount of $300.000 in December, 2005, intending to use the loan proceeds to completely remodel a home he owned in Seattle (the "Golden Gardens Home"). Exh. 5, Daniel Dec. WLC knew of Judd's intended use of the funds, and that this was therefore not an ordinary "bridge loan". Exh. 4, Daniel Dec., Riley Deposition at 36-37. To secure the loan, Judd granted a deed of trust against the Golden Gardens Home. Exh. 5, Daniel Dec. Based on Judd's loan application, it appeared at the time that the Golden Gardens Home had plenty of equity to provide adequate security for the loan. Id.
Shortly into his improvement/remodel project of the Golden Gardens Home, Judd encountered numerous construction issues. Exh. 6, Daniel Dec., Judd Deposition at 86-7. These construction issues required additional expenditures to complete the remodel project. Judd applied for an additional loan from WLC in the amount of $100,000 in February, 2006 to deal with the additional expenditures. Exh. 7, Daniel Dec. This loan was also secured by a deed of trust against the Golden Gardens Home. Id. Judd estimated the approximate value of the Golden Gardens Home at this time at $1.3 million. His estimate of value had increased $100,000 over the December, 2005 estimate due to the substantial improvements he had made to the property. Moreover, it appeared that Judd still had $400,000 in equity in the Golden Gardens Home at this time. Id.
The construction issues significantly delayed Judd's improvement project. As of August, 2006, Judd still had not completed the remodel project. Exh. 6, Daniel Dec. Nonetheless, Judd continuously marketed the Golden Gardens Home for sale. After trying to sell the property for many months without completion of the remodel, Judd determined that he needed to take the property off the market and complete the remodel project in order to procure a buyer. Id.
A year after WLC made the loans, Judd requested that WLC subordinate its deeds of trust against the Golden Gardens Home to allow him to refinance the first position mortgage. Exh. 4, Daniel Dec., Riley Deposition at 62-3. In consideration for agreeing to the subordination, WLC requested additional security. WLC and Judd agreed that a third deed of trust would be given as security. Exh. 4, Daniel Dec., Riley Deposition at 80-1. This deed of trust was secured against Judd's personal residence in Kirkland (the "Kirkland Home") and had a face value of $400,000 (being the aggregate of the $300K and $100K loans). It is this third deed of trust, and the Kirkland Home, that are the subject matter of this litigation. This third deed of trust was recorded in March, 2007. Exh. 8, Daniel Dec.
By August, 2007 Judd had finally completed the remodel project on the Golden Gardens Home. He listed the property for sale at $1,249,999. Exh. 6, Daniel Dec., Judd Deposition at 89-90. Unfortunately, Judd was unable to sell the property at the price he expected. By early 2008 Judd had reduced the listing price to $949,000. Id. Judd was having problems covering mortgage payments on two properties for much longer than he intended. By late 2007 the real estate market had begun to slow down significantly. Judd was affected by the slow-down in two ways. First, he was having a difficult time selling either of his properties. Second, his income was down significantly. By early 2008 Judd was in arrears on the Kirkland Home mortgage payments by nearly $40,000. Exh. 6., Daniel Dec., Judd Deposition at 101-104.
In February, 2008 the first position mortgage holder of the Kirkland Home commenced foreclosure proceedings. Id. However, the trustee conducting the foreclosure failed to provide notice of the sale to WLC. Page 1 of the notice of trustee's sale clearly shows that WLC is not listed among the lienholders who received notice of the sale. Exh. 9, Daniel Dec. The trustee, Karen Gibbon, has confirmed that WLC was not notified of the foreclosure. Exh. 10, Daniel Dec. This is because the WLC deed of trust on the Kirkland Home did not appear on the trustee's sale guarantee (title report) ordered by Ms. Gibbon.
As mentioned previously, WLC loans are due nine months from the date of issue, or upon sale of the secured property, whichever occurs first. By early 2008, therefore, Judd's loans were well in arrears. WLC approached Windermere SCA and Mr. Shriner as guarantor of the loans at that time to seek payment or a satisfactory alternative. WLC, Windermere SCA, and Mr. Shriner agreed to enter into an assignment agreement in which WLC would assign to Windermere SCA all rights against Judd, and Windermere SCA would in turn sign a new promissory note payable to WLC personally guaranteed by Mr. Shriner for the full amount of the Judd loans plus interest. By agreeing to this arrangement, WLC agreed to allow Windermere SCA more time to facilitate repayment of the Judd debts. Windermere SCA granted WLC a deed of trust against its office building in Kirkland as security for the new note. Exh. 11, Daniel Dec., Shriner Deposition at 83-4.
Meanwhile, Judd had entered into a purchase and sale contract for the sale of the Golden Gardens Home. Judd was represented in that sale by an agent from a separate real estate firm in located in Ballard. Exh. 6, Daniel Dec., Judd Deposition at 89-91. The escrow agent on that sale contacted WLC for a payoff demand on the WLC deeds of trust. Again, there were two deeds of trust on the Golden Gardens Home, one for $300k and one for $100k. The sale of the Golden Gardens Home was expected to (and did ultimately) render significant proceeds to WLC against Judd's debt. Id.
Additionally, around the same time, Judd had entered into a contract to sell the Kirkland Home to Plaintiffs Repass for a purchase price of $1,070,000. Judd was represented in this sale by a John L. Scott agent named Kirk Russell, a self-proclaimed short sale expert. Windermere SCA was not involved in the sale to Repass. Windermere SCA received no commission or anything of value whatsoever in Judd's sale to Repass. Exh, 6, Daniel Dec., Judd Deposition 48-9,105.
Although WLC suspected that there would be little to no equity in the Kirkland Home, it did at least know that a short sale could not close without WLC removing its lien. Thus, WLC knew that at some point the escrow agent would contact WLC for a payoff demand. At that time, WLC would have been able to approach Judd for payment. WLC also would have been in a position to require that the senior lienholders "kick some money down the line" in order to obtain a closing on the sale. In other words, WLC could have required that the senior lienholders relinquish some funds to WLC in order to obtain WLC's lien release, and a closing on the sale. Simply put, WLC stood to reap some gain from a short sale of the Kirkland Home regardless of the fact that it was upside-down in equity. Exh. 11, Daniel Dec., Shriner Deposition at 85-6.
In addition to demanding funds from the senior lienholders in a short sale, WLC and its guarantors, Windermere SCA and Shriner, would have used the short sale as an opportunity to demand that Judd produce funds. Id. Judd had told Mr. Shriner several times that his family had money and would help him out if he was unable to satisfy his obligations to WLC. Mr. Shriner in particular had planned on objecting to a lien release on the Kirkland Home unless Judd made an arrangement to satisfy the debts through family assets. Id.
See attached Declaration of Richard Phenneger (Mr. Phenneger, a father figure to Judd, states that he would have loaned Judd $50,000 - $60,000 had Judd asked him for help at that time).
WLC, Windermere SCA, and Mr. Shriner had no reason to believe that the pending sale to Repass could close without escrow or Judd coming to WLC and requesting a reconveyance of the WLC deed of trust. However, the Repass sale indeed did close without WLC ever being contacted for a payoff. The title report issued by Commonwealth did not reveal the WLC deed of trust. Exh. 1, Daniel Dec. However, Repass admits that prior to closing, he learned of the WLC deed of trust from his son (who says he found it on a RealList.com, a website often utilized by real estate professionals). See Complaint, ¶15.
Neither Mr. Shriner nor anyone at WLC or Windermere SCA ever saw a title report for the subject property or had knowledge that the subject deed of trust was missing from title. They were all shocked to learn that the subject transaction had closed without escrow having contacted them for a payoff demand. After the sale had closed, it was too late for them to do anything about it.
III. ISSUE PRESENTED
Whether this court must deny Plaintiffs' motion for summary judgment when Plaintiffs have failed to meet their burden of proof necessary to shift the burden to Defendants, when the law does not support the remedy requested by Plaintiffs, and when genuine issues of material fact would preclude Plaintiffs' right to summary judgment in any event, with such disputed facts including: (a) whether Defendants truly stand to receive an unequitable gain or "unearned windfall" from Commonwealth's insuring of Repasses' title, (b) whether Defendants could have recovered any money in conjunction with Judd's sale of the Kirkland Home to Repass, (c) whether Plaintiffs’ contentions in this lawsuit of collusion and willful actions in concert by the Defendants are totally without merit and unsupported by any evidence, (d) whether Repass had actual knowledge prior to closing of the subject deed of trust, and (e) whether Commonwealth is a mere volunteer in its acceptance of responsibility for the Repasses’ title claim?
IV. EVIDENCE RELIED UPON
Defendants rely on the Declarations of David C. Daniel, Craig Shriner, and Richard Phenneger, and on the pleadings and documents on file herein.
V. LEGAL AUTHORITY AND ARGUMENT
A. Summary Judgment Standard.
According to CR 56(c), a court must deny a party's motion for summary judgment if the files and records, viewed in the light most favorable to the nonmoving party, present genuine issues of material fact. Mutual of Enumclaw Ins. Co. v. USF Ins, Co., 164 Wn.2d 411, 191 P.3d 866 (2008). On summary judgment motion, burden is on moving party to prove there is no genuine issue as to fact which could influence outcome at trial. Hartley v. State, 103 Wn.2d 768, 698 P.2d 77 (1985). If the moving party fails to satisfy its burden, summary judgment must be denied. Id. If reasonable minds could reach more than one conclusion, then summary judgment is inappropriate. Vallandingham v. Clover Park School Dist. No. 400, 154 Wn.2d 16, 109 P.3d 805(2005).
B. Equitable subrogation does not apply.
Plaintiffs’ requests for equitable subrogation are unsupported by the laws of equitable subrogation for several reasons.
1. Plaintiffs are not subrogating into the shoes of another.
Plaintiffs ask this court to equitably subrogate them, the Plaintiffs, to a position superior to that of the subject deed of trust. Such is not equitable subrogation. Subrogation is the act of stepping into the shoes of another to avoid unjust enrichment; "Subrogation is the substitution of one person in place of another ... so that he who is substituted succeeds to the rights of the other in relation to the debt or claim, and its rights, remedies, or securities." Bank of America v. Prestance Corp., 160 Wn.2d 560, 565, 160 P.3d 17 (2007) (citation for quote omitted). The Plaintiffs do not ask to be substituted into the shoes of another, but rather to be given a superior position to the subject deed of trust. In essence, they are asking the court to disregard the Defendants' properly recorded and perfected lien by giving Plaintiffs superiority to it. Plaintiffs step into a currently unoccupied position; there are no shoes which Plaintiffs would be filling.
2. Equitable subrogation is not allowed if a junior interest is prejudiced.
Even if the Plaintiffs were properly seeking equitable subrogation, the law would not support the remedy in this case. The remedy is being sought specifically at the expense of and to the prejudice of the subject deed of trust held by Windermere SCA. "Equitable subrogation should never be allowed if a junior interest is materially prejudiced….” Bank of America, 160 Wash.2d at 572, 160 P.3d 17.
Additionally, as Repass himself testifies, this is Commonwealth’s lawsuit and not his. The reason this case exists is because of Commonwealth’s error in its title examination and its resulting obligation to Repass. Washington caselaw is clear that equitable subrogation does not extend in favor of a title insurer when such would alleviate the insurer of its own negligence at the expense of an innocent third party creditor. Kim v. Lee, 145 Wn.2d 79, 31 P.3d 665 (2001).
In the instant case, legal remedies and equity suggest that the loss should fall on the title company rather than the innocent judgment creditor. As in Coy, this case was *92 precipitated by the title company's negligence and failure to acknowledge the lien. Yakima Title not only failed to discover Kim's judgment lien when it conducted its title search for the Lees' loan from Pioneer, as in the Coy case, but also failed to acknowledge the lien when it had actual knowledge of it from Kim's counsel. With the information at hand, Yakima Title still issued the title policy insuring PHH's first lien position. Applying equitable subrogation to extend in favor of Yakima Title would result in alleviating Yakima Title of its own negligence and complete disregard of the actual notice at the expense of an innocent judgment creditor.
Kim v. Lee, 145 Wn.2d 79, 91-2, 31 P.3d 665 (2001).
The Repasses’ rights here are not at issue. Commonwealth has accepted responsibility for the title claim, regardless of the fact that Repass admits that he had knowledge of the subject lien prior to closing. As Repass himself admits, this lawsuit is pursued by Commonwealth with the intention of avoiding a financial obligation to Repass at the expense of a valid and innocent third party lienholder. Such an instance as in this case is the very basis upon which title insurance is needed and procured. To allow the carrier here to avoid its responsibility which it has accepted to Repass by disregarding the Windermere SCA deed of trust clearly flies in the face of the title insurer's obligation, Washington caselaw, and the very equities which would otherwise support the remedy of equitable subrogation, which by definition is intended to prevent unjust enrichment, not provide for it. Commonwealth issued a title policy and now rather than pay the claim, it seeks to have this court order a properly recorded and perfected lien disregarded.
3. Commonwealth is a mere volunteer.
The Washington Supreme Court explained in Coy v. Raabe, 69 Wn.2d 346, 418 P.2d 728 (1966), that a title insurance company is particularly limited in its right to employ subrogation. The Coy Court held that it was "not the province of the court to relieve a title insurance company of its contractual obligation..." Coy, 69 Wn.2d at 351. The Court stated that "[subrogation] will be applied where any person, other than a mere volunteer, will suffer damage because of the unjust enrichment of another." Coy, 69 Wn.2d at 350-1. (Emphasis added.)
The Repass title policy excludes coverage for issues of title that were actually known by the insured. Exh. 1, Daniel Dec. Repass admits in the Complaint that he knew of the subject deed of trust prior to closing. As such, Commonwealth's election to accept responsibility for the title claim was an election, a voluntary action, and not an obligation under the policy. For some reason, Commonwealth waited 6 months before notifying the Repasses of the defect in their title. Exh. 2, Daniel Dec. In that letter, however, the insurer clearly accepts responsibility for the claim as a mere volunteer, which would preclude the remedy of equitable subrogation.
4. Bank of America is not an analogous case.
Plaintiffs reliance on Bank of America v. Prestance Corporation, 160 Wn.2d 560, 160 P.3d 17 (2007) is misplaced. The Court ruled there that a refinancing lender/mortgagee is entitled to equitable subrogation into shoes of the original lien positions, regardless of either its actual or constructive knowledge of intervening interests.
The case at hand does not concern a refinance. Bank of America stands for the equitable result that is reached by allowing a homeowner to seek out favorable refinancing without the lender having to forfeit its established lien position, thereby being an exception to the "first in time" rule in Washington concerning perfecting liens. Equitable subrogation of the new loan to the original lien position allows a tremendous benefit to society of refinancing and competitive lending.
Our case is further unique in terms of subrogation inasmuch as the title insurer in here played a role in creating the problem. But for the title insurance company's mistake in missing the subject deed of trust, the transaction never would have closed. WLC, Windermere SCA, and Mr. Shriner would have maintained their leverage over Judd and could have negotiated a settlement for the amounts Judd owes them. Richard Phenneger would have contributed in Judd's favor had he been given the opportunity.
It appears that the case at hand indeed presents an issue of first impression for the Washington courts.
C. Disputed Facts.
There are several genuine issues of material fact that are in dispute. First, Plaintiffs inaccurately contend that an "unearned windfall" would result to Defendants if they are allowed to maintain their properly recorded and perfected deed of trust lien position on the Kirkland Home. Craig Shriner has incurred substantial expense in maintaining the interest payments on the delinquent loans and in defending this lawsuit being brought by Commonwealth to avoid its coverage obligations. He is invested significantly in this matter. There is substantial evidence that proves that even if Commonwealth made a substantial contribution against the debts secured against the Kirkland Home (according to its obligations as a title insurer), that even then the Defendants would still be out a substantial sum of money. The contention that an unearned windfall will result to Defendants is unsupported and incorrect.
Second, Plaintiffs inaccurately contend that Defendants concede that there was never any hope of recovering any money from the sale of the Kirkland Home. Chris Judd had told Craig Shriner on numerous occasions that if push came to shove, he could reach out to family for money. Defendants were therefore prepared to use the sale of the subject property as leverage against Judd to force him to reach out to family members for money. The sale "could not" close without the subject lien being released. Indeed, Chris Judd did have family who would have been willing to help him financially at the time, had the request been made. See Declaration of Richard Phenneger.
Moreover, Plaintiffs entire case is premised upon inaccurate contentions of collusion and willful misrepresentation by the Defendants. There is no proof whatsoever that WLC, Windermere SCA, or Mr. Shriner had knowledge that the sale to Repass was closing. Indeed, the evidence clearly shows that they were awaiting a payoff demand from escrow, which we now know never came. Plaintiffs' demands for an equitable remedy flow from their belief of collusion on the part of the Defendants. Their collusion theories are specious and inflammatory, and totally unsupported by evidence. Plaintiffs provide no evidence to the contrary.
1. There will be no unearned windfall.
Craig Shriner, owner of Windermere SCA, has spent over $100,000 already in making interest payments on the Judd debts and on defending this lawsuit being pursued by Commonwealth in the name of Repass. It is helpful to examine the numbers as they are now, in the context of this lawsuit and the circumstances as they are presently, as compared to how things would have been had Commonwealth not missed the deed of trust and had never started this lawsuit.
Take first the hypothetical scenario that Commonwealth had not missed the deed of trust, and the lawsuit never came about. The total balance of the outstanding debt at the time of the closing of the two sales (Kirkland Home and Golden Gardens Home) was approximately $473,000.00 (including accrued interest). The Golden Gardens Sale rendered roughly $117,000.00 against the debt, leaving a balance of $356,000.00. Subtract from that the $100,000 that Mr. Shriner has spent over the course of this lawsuit; he could have instead put that money towards the balance owing at the time. That leaves what would have been a remaining balance in 2008 of $256,000.00. If you further reduce that balance by the amount that Chris Judd could have obtained from his family in the sale of the home to Repass ($60k-$70k, see Dec. of Phenneger), you are left with a balance of approximately $190k - $200k.
Now, look at the numbers given the context of the lawsuit. After the Golden Gardens Sale, the outstanding balance was $356k. Add to that the $100k that Mr. Shriner has had to spend to maintain the loan while defending this lawsuit from Commonwealth, and Mr. Shriner's exposure rises to $456,000.00.
Thus, even if Commonwealth contributed over $250,000.00 towards the payment of the Judd debts now, Mr. Shriner would still be walking away with zero windfall. Being forced to defend this lawsuit and divert his resources has caused him substantial hardship which he otherwise would not have incurred. There is no windfall.
2. Judd's family would have provided him money.
Chris Judd told Mr. Shriner on several occasions that if push came to shove that he would be able to reach out to members of his family for money. Richard Phenneger, a "father figure" to Chris Judd, submits a declaration that he could have and would have given Chris Judd money to help him avoid his financial troubles in March, 2008, had he been asked. See Declaration of Richard Phenneger. Of course, as the Kirkland Home closed without any notice ever having been given to WLC or Windermere SCA, Mr. Shriner's plan to require Judd to obtain money from his family to pay down the debts was thwarted, as all leverage to apply pressure was lost when the sale closed.
3. Plaintiffs' contentions that Defendants acted willfully and in concert to allow the sale to Repass to close are specious, inflammatory, and totally without merit.
Plaintiffs claim intentional misrepresentation against the Windermere SCA and WLC defendants in this case. These claims require that Plaintiffs prove knowledge by the Defendants that the deed of trust had not been removed, or that the title report omitted disclosure of the deed of trust. There is not a shred of evidence to suggest any such knowledge. WLC was the lienholder who would have been contacted for a payoff. WLC manager Don Riley has testified that his attention was on the closing of the Golden Gardens Home and not the Kirkland Home, as he expected there to be more equity available in Golden Gardens for a payoff. Regardless, however, Riley knew that without a payoff demand and agreement, the Kirkland Home could not sell. WLC’s lien was perfected.
Likewise, Craig Shriner and Windermere SCA were third parties entirely. Escrow would not have contacted Windermere SCA for a payoff even if it had known of the deed of trust. WLC was the lienholder; Mr. Shriner and Windermere SCA were mere third party guarantors. There is no evidence that Windermere willfully stood by and allowed this sale to close, or knowledge that Windermere knew Repass was mistaken.
VI. CONCLUSION
For all of the reasons set forth herein, the Court must deny Plaintiffs’ motion for summary judgment. A proposed order will be provided at the time of the hearing.
DATED this 16th day of September, 2011.
DEMCO LAW FIRM, P.S.
By_______________________________________
Lars E. Neste, WSBA #28781
David C. Daniel, WSBA #34410
Attorneys for Windermere Real Estate/S.C.A.
Inc., and Washington Loan Company
IN THE SUPERIOR COURT OF WASHINGTON
IN AND FOR THE COUNTY OF KING
FRED AND KATHLEEN REPASS,
Plaintiffs,
V.
WINDERMERE REAL ESTATE/S.C.A., INC.; CHRISTOPHER JUDD, a single man;
WASHINGTON LOAN COMPANY, Inc., a Washington corporation; and ALISON A. HAIG, as trustee of subject of deed of trust,
Defendants.
Cause No. 09-2-46671-8
PLAINTIFFS’ REPLY IN SUPPORT OF SUMMARY JUDGMENT MOTION
1. REPLY
Fred and Kathleen Repass are not asking the court to "disregard a valid lien" from their property as Defendants suggest. Rather, they are asking the court to relegate Defendants' deed of trust to the same position it was in before Plaintiffs paid approximately $1,000,000.00 to purchase the Kirkland Property. Defendants offer no principled reason why they should receive an unearned collection windfall.
The question of whether equitable relief is appropriate is a question of law. Niemann v. Vaughn Cmty. Church, 154 Wh.2d 365, 374, 113 P.3d 463 (2005); Bank of Am., N.A. v.
Prestance Corp., 160 Wn.2d 560, 564, 160 P.3d 17, 19 (2007). Even considering Defendants’ so called "disputed facts" in the light most favorable to Defendants, equitable relief in favor of Plaintiffs is appropriate.
Applying an equitable remedy will not prejudice Defendants. When Defendants recorded their $400,000.00 deed of trust against the Kirkland Property their deed of trust was recorded in a junior position. It was recorded junior to a First Franklin first deed of trust in the amount of $900,000.00 and a First Franklin second deed of trust in the amount of $225,000.00.1 WLC’s $400,000.00 deed of trust was also recorded behind two DSHS liens for back child support. The first of the DSHS liens was recorded on September 7, 2007, for $33,000.00 and the second was recorded on January 17, 2008, for $40,010.28.2 Accordingly the liens were ranked against the Kirkland Property as follows:
Defendants do not even attempt to distinguish the long line of authority cited in Plaintiffs’ opening brief which all allow equitable subrogation to a purchaser, like Fred and Kathleen Repass, who paid money to pay off mortgages as part of a purchase. Rather, in an
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1 Second Declaration of Erin M. Stines ("Stines Second Dec."), Exhibit S and T, First Franklin Deeds of Trust.
2 Stines Second Dec., Exhibits U and V, DSHS liens.
_________________________________
attempt to elevate their junior position and obtain a collection windfall, Defendants cite Kim v. Lee, 145 Wn.2d 79, 91-2 (2001) for the out-dated notion that a title company should pay a creditor whenever a lien is missed on title. They argue that under Kim knowledge (actual or constructive) of a prior lien bars the application of the doctrine of equitable subrogation. Defendants fail, however, to acknowledge that five years after Kim was decided our Washington State Supreme Court changed the landscape of the doctrine when it decided Bank of America, N.A. v. Prestance Corp., 1.60 Wn.2d 560, 562, 160 P.3d 17 (2007).
Under Prestance, knowledge of intervening interests is not relevant "as long as the junior interests are not materially prejudiced, then equitable subrogation maintains the proper priorities" Prestance, 160 W11.2d at 578. The court in Prestance advocates that "equitable subrogation is a broad doctrine and should be followed whenever justice demands it and where there is no material prejudice to junior interest." Prestance, 160 Wn.2d at 581.
Defendants claim to have recorded their lien against the Kirkland Property when dramatic changes in the real estate market changed their expectation that their loans to Chris Judd would be paid back with proceeds from the sale of his Golden Gardens property. But at the time their $400,000.00 deed of trust was recorded WLC expected to get "nothing" from the Kirkland Property.3 WLC expected to get "nothing" from the Kirkland Property because WLC knew its deed of trust would be recorded in a junior position. Plaintiffs simply ask this court to relegate Defendants' deed of trust to the same position it was in before Plaintiffs paid approximately $1,000,000.00 to satisfy senior deeds of trusts to purchase the Kirkland Property. If Defendants expected to get "nothing" before Chris Judd's sale to Fred and
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3 Stines Dec., Exhibit R, Riley Email sent February 27, 2008.
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Kathleen Repass there is no principled reason for them to expect anything more today. There is no prejudice.
Washington is not the only state to adopt the Prestance approach to equitable subrogation and courts around the country are expanding the scope of the doctrine. A recent Arizona bankruptcy court, for example, has gone so far as to extend the application of the doctrine to a deed of trust that was mistakenly not recorded. In In re Gutang, 2011 WL 2457647 (Bankr.D.Ariz) (attached to Stines Second Dec. at Exhibit W) two creditors (Chase and Deutsche Bank) argued for a first lien position against real property. The court ultimately held that although Deutsche Bank’s lien was mistakenly not recorded it was entitled to priority by equitable subrogation. The court reasoned that Chase did not bargain for a superior lien position. In re Gutang, 2011 WL 245 7647.
Just as Chase did not bargain for a senior lien position, Defendants did not bargain for a senior lien position. Giving Defendants the benefit of a senior lien now where they paid nothing for it and had only an expectation of getting "nothing" is not supported by Washington law and it is not equitable.
Defendants in their effort to better their position in the Kirkland Property now cry to the court that this litigation has burdened Mr. Shriner with attorneys’ fees and that under no circumstance will any of the Defendants walk away from this deal with money in their pockets - thus trying to defeat Plaintiffs’ position that Defendants stand to earn a windfall. Defendants try to confuse the definition of a windfall.
A windfall of this kind is a collection windfall - an unexpected opportunity to pay down a debt that even "shocked" Defendants. As a result, Defendants seek to profit from it only because Fred and Kathleen Repass paid approximately $1,000,000.00 to purchase the Kirkland Property. Plaintiffs object to the prospect of Defendants jumping (without consideration) into a first lien position and using that position to satisfy Chris Judd's debt. Mr. Shriner's decision to spend money on attorneys’ fees protecting a worthless lien position is not relevant to the issue of law before the court.
Furthermore, Defendants’ creative theory that equitable subrogation should be denied here because Fred and Kathleen Repass are mere "volunteers" is not relevant, not properly before the court, and not supported by Washington law.
It is black letter law in Washington that a plaintiff insured against a loss is the real party in interest - not the insurance company. Weber v. Biddle, 72 Wn.2d 22, 28, 431 P.2d 705, 710 (1967). In Weber, plaintiff maintained action as real party in interest against a wrongdoer where he was insured against a loss by a liability policy. Alaska Pacific S.S. Co. v. Sperry Flour Co., 94 Wash. 227, 162 P. 26 (1917). This rule stands to reason in this case as a title company cannot quiet title to property it does not own. If title is not cleared in Plaintiffs’ names, Defendants’ may attempt to foreclose their interest thus threatening the Plaintiffs' interest in the Subject Property.
And to the extent that Defendants are raising an objection under Civil Rule 17(a) there is no basis for that objection. CR 17(a) provides that an action shall not be dismissed for absence of the real party in interest until a reasonable time after objection to such absence, Fitch v. Johns-Manville Corp., 46 Wn. App. 867, 733 P.2d 562 (1987). Defendants cite no authority for raising their objection in response to a summary judgment motion less than one month before trial.
Furthermore, Defendants neglect to analyze the modem function of the rule which is simply to protect against a subsequent action by the party actually entitled to recover, and to insure generally that the judgment will have its proper effect as res judicata. Sprague v. Sysco Corp., 97 Wn. App. 169, 982 P.2d 1202, review denied, 140 Wn.2d 1004, 999 P.2d 1262 (1999). There is no threat here that a title company will later bring another action seeking recovery against Defendants on the same claims raised in this case. Defendants’ objection is meaningless.
Finally, even if the court could somehow find Mr. Phennegar's declaration credible it is not relevant to the narrow question of law presented to the court. If considered it should be considered for the sole purpose of establishing damages which is not an issue currently before this court.
II. CONCLUSION
In sum, Defendants’ lien position is not prejudiced by the application of an equitable remedy. Equitable subrogation will not extinguish Defendants’ lien. Rather it will relegate Defendants’ lien to the same lien position they had before Plaintiffs purchased the Kirkland Property. Defendants have not paid for and never expected a first lien position.
Accordingly, Plaintiffs Motion for Summary Judgment should be GRANTED. Equity demands that Plaintiffs’ interests in the Kirkland Property be declared prior over any interest of the Defendants.
DATED this 20th day of September, 2011.
FIDELITY NATIONAL LAW GROUP
s/ Erin M. Stines _____________
Erin M. Stines, WSBA # 31501
Fidelity National Law Group
A Division of Fidelity National
Title Group, Inc.
1200 – 6th Avenue, Suite 620
Seattle, WA 98101
(206) 223-4525
(206) 223-4527 - FAX
Attorney for Plaintiffs
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Case Update: Plaintiff Change of Counsel filed April 5, 2011
Windermere Founder John W. Jacobi's Washington Loan Company, Windermere Real Estate S.C.A. Redmond and its Agent Christopher Judd, Sued for Intentional Misrepresentation and Other Claims in Alleged "...unlawful scheme to enrich themselves at the expense of plaintiffs and others..."
(Above L to R) The Governing Persons of the Washington Loan Company: 1) Windermere Founder John W. Jacobi is listed as President of the Washington Loan Company; 2) Timothy Wissner—a generic silhouette head from his Windermere webpage—CFO of franchiser Windermere Services Company is listed as Washington Loan Company Vice President; 3) Kendra Vita, Manager of franchiser Windermere Services Company is listed as Secretary of the Washington Loan Company; 4) franchiser Windermere Services Company General Counsel, attorney Paul S. Drayna—WSBA #26636—is listed as Registered Agent of the Washington Loan Company; 5) Don Riley, Washington Loan Company manager; 6) Windermere Real Estate S.C.A. Redmond owner Craig Shriner; 7) Windermere Redmond SCA managing broker Aaron Shriner; 8) Windermere Redmond SCA agent, Christopher Judd's generic silhouette head; Windermere Redmond SCA and Washington Loan Company Demco lawyers 9) Lars Neste—WSBA #28721—and 10) David C. Daniel—WSBA #34410. As the public truth of Windermere Real Estate continues emerging, more and more of its personnel delete their photos and put up generic silhouette heads. The Washington Loan Company's business license states that its registered trade name is Windermere Real Estate / Eastlake.
Defendants Washington Loan Company and Windermere Real Estate S.C.A. Redmond must be compelled by court to produce discovery.
NO. 09-2-46671-8 SEA; COMPLAINT FOR: INTENTIONAL MISREPRESENTATION; QUIET TITLE; BREACH OF WARRANTY; DECLARATORY AND INJUNCTIVE RELIEF; filed in King County Superior Court on December 28, 2009.
Under “I. PARTIES” the Complaint in part states:
2. Christopher Judd (“Judd”) is believed to be a single man residing in King County. At all times material herein, Judd was a licensed real estate agent employed by or working under Windermere Real Estate / SCA, Inc. (“Windermere Real Estate”) a real estate office located in Kirkland, Washington.
3. Windermere Real Estate is a Washington corporation engaged in the business of representing members of the public in purchasing and selling real estate in King County, Washington. Windermere Real Estate employs licensed real estate agents to engage in such services, and either it or its principals act as a broker responsible for oversight and supervision of the sales and purchase related real estate activities of its employees.
4. Washington Loan Company, Inc. (“WLC”) is a Washington corporation owned by or related to Windermere Real Estate or its principals. On information and belief, WLC makes loans to customers and/or real estate salespersons of Windermere Real estate in connection with real estate related transactions.
5. Alison A. Haig (“Trustee Haig”) is a successor trustee under a deed of Trust dated March 29, 2007 recorded under King County Recording No. 20070330002740 (“Deed of Trust”) originally between Judd and WLC. This defendant is included in this action solely in her capacity as trustee.
6. Defendants Judd, Windermere and WLC are hereafter sometimes referred to jointly as “Real Estate Professionals.”
The Complaint in part under “II BACKGROUND” continues:
7. Defendants Judd, Windermere Real estate, and WLC created or participated in an unlawful scheme to enrich themselves at the expense of the plaintiff and others, by permitting and/or facilitating the sale of a residence to Mr. and Mrs. Repass by misrepresentations and omissions of adverse facts known to them but not known to the plaintiffs.
8. Judd is a licensed real estate salesperson. At all times herein, Judd worked for and was supervised by Windermere Real Estate which served as a supervising broker of Judd’s work-related activities. Using funds and/or credit of Windermere Real Estate and related party WLC, Judd purchased residential properties for his own account for resale.
9. In April 2004, Judd purchased a residential property located at 8812 Golden Gardens Drive N.W. (“Golden Gardens House”) for $475,000. Shortly after the purchase, Judd encumbered the property with several mortgages. In late 2005 or early 2006, WLC loaned Judd $400,000. Some months later, WLC and Judd agreed to record a deed of trust on the heavily encumbered Golden Gardens house purportedly to secure the antecedent debt.
10. On information and belief, the WLC loan to Judd was guaranteed by Windermere Real Estate or one of its principal owners.
11. In April 2006, and after the defendants completed the loan in connection with the above transactions, Judd purchased the Kirkland Property which is the subject of this action in Kirkland, Washington. Judd encumbered that property with mortgages exceeding the value of the Kirkland Property.
12. Thereafter, on March 30, 2007, Judd and WLC executed another deed of trust purportedly using the Kirkland Property to secure the same previous antecedent loans involving the Real Estate Professionals in 2005 or early 2006. This deed of trust is dated March 29, 2007 and recorded under King County Recording No. 20070330002740 (“Deed of Trust”). The amount of this encumbrance exceeded the value of the Kirkland Property by several hundred thousand dollars. The defendant Real Estate Professionals, Judd, Windermere Real Estate and WLC were aware that this Deed of Trust was worthless to secure the prior debt and that it was inferior to all prior encumbrances for which the aggregate indebtedness already exceeded the value of the Kirkland Property.
13. In February 2008, prior secured lenders on the Kirkland Property initiated foreclosure proceedings. The defendant Real Estate Professionals were each aware of these proceedings and were aware that a result of the foreclosure proceedings would be the extinguishment of their junior deed of trust.
14. Judd and Windermere Real Estate undertook to sell the Kirkland Property before the foreclosure. Windermere Real Estate (or its affiliate office) was the listing broker. When the Kirkland Property was listed for sale, the total encumbrances against it exceeded the value of the property by several hundred thousand dollars. Defendants and each of them (excluding the Trustee Haig) knew that if the Deed of Trust between them was disclosed to a purchaser, the Kirkland Property could not be sold.
15. At no time did any of the defendant Real Estate Professionals disclose the existence of the Deed of Trust to plaintiffs. However, prior to closing, Mr. Repass discovered the subject Deed of Trust of record. He objected to it. Defendant Judd and other representatives of Windermere Real Estate assured him that the Deed of Trust would be eliminated from title before closing and placed on another property. Mr. Repass relied upon this representation. Subsequently, plaintiffs were provided a title report prior to closing which did not disclose the subject Deed of Trust and they assumed that defendants had eliminated the Deed of Trust from title as had been represented would be done. In fact, the Real estate Professionals became aware that the title report omitted the Deed of Trust by mistake. With knowledge of this material mistake, defendants intentionally remained silent and deliberately refrained from removing the Deed of Trust from the title to the property as promised. Plaintiffs were unaware of the mistake and in good faith relied at their substantial detriment upon defendants to do what was promised — remove the deed of trust from title before closing.
16. The Real Estate Professional Defendants’ purpose in remaining silent in the face of adverse material facts affecting the transaction was purposeful and intended to serve their own interest at the expense of others. The defendants’ silence was intended to allow: (1) defendants Judd and/or Windermere Real estate to receive substantial commissions on a sale which would not have otherwise occurred; (2) to give an otherwise worthless and questionable Deed of Trust value and priority on the property of innocent persons; (3) to avoid personal guaranty obligations owed by Windermere Real Estate or its principal; (4) defendant Judd to totally avoid any personal obligations on his loan; and (5) to attempt to secure an involuntary payment by other innocent persons through foreclosure of the Deed of Trust who were never a party to the defendants’ transactions. Defendants’ intentional silence continued through the closing of the Kirkland Property and the purchase by the plaintiffs. Shortly thereafter, within hours of closing, the defendants’ representatives demanded payment for the Judd loan as a condition of removing their Deed of Trust against plaintiffs’ property.
17. Contemporaneous with the plaintiffs’ closing, WLC and Windermere Real Estate restructured the original loan transaction with defendant Judd so that WLC could avoid accountability for its participation in the surrounding circumstances and so that Windermere Real Estate and/or its principals could avoid preexisting guaranty obligations of the antecedent debt and attempt to wrongfully realize payment against plaintiffs’ property. The restructuring was consummated by an assignment of the Deed of Trust by WLC to Windermere Real Estate but the assignment was not recorded until weeks after the plaintiffs’ transaction closed.
18. Within two weeks of the closing of the plaintiffs’ transaction, defendant Judd sold his Golden Gardens home, which also had a Deed of Trust against it purportedly securing the same loan obligations between Judd and WLC, guaranteed by Windermere Real Estate. Defendants released and reconveyed the Deed of Trust on the Golden Gardens home for the same underlying obligations in connection with that sale transaction in return for receipt of a fraction of the amount of Judd’s underlying obligation.
19. Based upon the foregoing allegation, plaintiffs assert the following causes of action:
The Complaint continues in part:
III. FIRST CAUSE OF ACTION
(AGAINST ALL REAL ESTATE PROFESSIONAL DEFENDANTS)
INTENTIONAL MISREPRESENTATION
20. The Real Estate Professionals, individually and collectively, knew the Deed of Trust remained on the Kirkland Property at the time the plaintiffs purchased the Kirkland Property.
22. The Real Estate Professionals, individually and collectively, knew plaintiffs were acting under a mistake as to the removal of the Deed of Trust on the Kirkland Property. On information and belief, each Real Estate Professional defendant was aware that (1) this Deed of Trust had not been removed from the title to the Kirkland Property; (2) the title report had mistakenly omitted disclosure of the Deed of Trust; and (3) Mr. and Mrs. Repass would not consummate the purchase of the Kirkland Property unless the Deed of Trust was first removed from the title.
23. The Real Estate Professionals failed to inform the plaintiffs of the fact that the Deed of Trust remained on the Kirkland Property for the unlawful purposes of (1) fraudulently inducing the purchase and sale of the Kirkland Property to plaintiffs, (2) effecting commissions on the sale of Judd and Windermere Real Estate, (3) avoiding Windermere Real Estate’s personal guaranty obligation, and (4) ensuring priority of payment to Washington Loan Company on the $400,000 Deed of Trust to which it would not have otherwise received.
24. The knowing and intentional failure of the Real Estate Professionals to disclose the existence of the Deed of Trust resulted in a material impairment of the value of the Kirkland Property and a material impairment to Mr. and Mrs. Repass.
25. Under the circumstances, each of the Real Estate Professionals acted in concert to save their own interest at the expense of plaintiffs and are liable for all damage and loss proximately caused therefrom.
IV. SECOND CAUSE OF ACTION
QUIET TITLE
27. Based upon the foregoing and the conduct of the Real Estate Professionals, plaintiffs are entitled to have title to their property quieted, free and clear of the Deed of Trust recorded under King County Recording No. 20070330002740.
28. This Deed of Trust is of doubtful validity and is additionally, unenforceable under the circumstances.
29. Defendants always intended to remove the Deed of Trust prior to the sale of the Kirkland Property because it had no priority or value against the subject property. Defendants’ inequitable conduct in connection with this transaction effected an equitable forfeiture of foreclosure of the Deed of Trust as a result of their silence in failing to disclose to plaintiffs the continued encumbrance of the Deed of Trust in the face of a known mistake and knowing reliance by plaintiffs that it had been removed.
V. THIRD CAUSE OF ACTION
(AGAINST JUDD)
BREACH OF WARRANTY
31. Judd conveyed the subject property to plaintiffs free and clear by a Statutory Warranty Deed filed under King County Recording No. 20080327002203. Judd’s conveyance of the property free and clear by Statutory Warranty Deed to plaintiffs in the face of the Deed of Trust constitutes a breach of his warranty obligations of title under the Statutory Warranty Deed for which the plaintiffs are entitled to resulting monetary damages and attorney fees and costs, in an amount to be proven at trial.
VI. FOURTH CAUSE OF ACTION
(AGAINST ALL DEFENDANTS)
DECLARATORY RELIEF
33. PURSUANT TO RCW 7.24.010 et seq., plaintiffs are entitled to a judgment of declaratory relief decreeing that the subject Deed of Trust is of no force and effect against plaintiffs’ property and/or that the subject Deed of Trust was equitably foreclosed as a result of the actions and conduct of the Real estate Professional defendants.
VII. FIFTH CAUSE OF ACTION
(AGAINST WINDERMERE REAL ESTATE AND TRUSTEE HAIG)
INJUNCTIVE RELIEF
35. Plaintiffs would be irreparably and wrongfully harmed by any action undertaken to foreclose the subject Deed of Trust under the surrounding circumstances.
36. Plaintiffs are entitled to a preliminary and permanent injunction restraining defendant Windermere Real Estate as assignee of the subject Deed of Trust and Trustee Haig, from undertaking any action to foreclose the Deed of Trust or adversely effect the title to plaintiffs’ property or their right to peaceful enjoyment thereof.
WHEREFORE, plaintiffs pray for judgment against defendants as follows:
1. Quiet title. A decree quieting title in their property free and clear of that Deed of Trust dated March 29, 2007 and recorded under King County Recording No. 20070330002740;
2. Misrepresentation. Judgment jointly and severally against the Real Estate Professionals (Judd, Windermere Real Estate and WLC) for all damages resulting from their intentional and material misrepresentations and unlawful acts;
3. Breach of Warranty. For monetary damages in an amount to be proven at trial against defendant Judd for breach of his warranty of title under the Statutory Warranty Deed dated March 19, 2008 and recorded under King County Recording No. 20080327002203, including attorneys’ fees;
4. Declaratory Relief. Declaratory judgment declaring and decreeing that the Deed of Trust, filed under King County Recording No. 20070330002740, no force or effect against plaintiffs’ property; or in the alternative, that the subject Deed of Trust was equitably forfeited or foreclosed as a result of the wrongful conduct of defendants.
5. Injunctive Relief. For preliminary and permanent injunctive relief restraining defendant Windermere Real estate and Trustee Haig or any successor trustee from taking any action to foreclose or adversely affect plaintiffs property in any way related to the subject Deed of Trust.
6. Attorneys’ Fees and Costs. For judgment of reasonable attorneys’ fees and costs against defendants in an amount to be proven at trial or by separate hearing thereafter.
THE WINDERMERE DEFENDANTS DO NOT ANSWER:
On March 15, 2010, Plaintiffs Repass filed a MOTION AND DECLARATION FOR ORDER OF DEFAULT, stating in part under:
“I. RELIEF REQUESTED
Plaintiffs move the Court for an order of default against the defendants because they have failed to appear, plead or otherwise defend against the plaintiffs’ Complaint.”
WINDERMERE REAL ESTATE S.C.A. REDMOND FINALLY ANSWERS:
In its Answer and Affirmative Defenses of Defendant Windermere Real Estate/S.C.A., Inc., filed on March 22, 20110, Windermere S.C.A. states in part under:
1. ANSWER TO COMPLAINT
2. Insufficient knowledge as to first sentence. Deny that Judd was employed by Windermere. Admit that Judd was a real estate salesperson licensed with Windermere. Deny all remaining allegations.
8. Insufficient knowledge as to first sentence. Admit that Judd was formerly a licensed real estate salesperson with Windermere. Deny all remaining allegations.
Editorial notes:
1. To escape liability, Windermere’s latest defense strategy is to state that agents of Windermere are NOT agents of Windermere; and instead it now portrays Windermere agents as “independent contractors” and agents “licensed to…” Windermere. As in the recent DeCoursey v. Paul Stickney/Windermere S.C.A. conflict of interest case where the Washington State Appeals Court recently upheld the trial court’s verdict and award in excess of $1,000,000, agent Paul Stickney was presented at trial as NOT BEING an agent of Windermere S.C.A., why the court did not buy. Indeed, even Windermere’s own website refers to its agents as being “agents.”
2. At this writing, despite Windermere S.C.A.'s assertion that Judd was "formerly" with Windermere, Judd is still listed as an agent at Windermere S.C.A. Redmond, selling homes with Windermere S.C.A. Redmond agent Lynn Sanborn.
Under “II. AFFIRMATIVE DEFENSES,” Windermere’s Answer in part continues:
2. WLC and Windermere are unrelated entities.
WINDERMERE FOUNDER JOHN W. JACOBI’S WASHINGTON LOAN COMPANY FINALLY ANSWERS
In its Answer and Affirmative Defenses of Defendant Washington Loan Company, Inc., filed on March 22, 20110, the Washington Loan Company states in part under:
II. AFFIRMATIVE DEFENSES
2. WLC and Windermere Real Estate/S.C.A., Inc. are unrelated entities;
3. WLC is no longer in any way related to the loans to Judd or the security interests supporting those loans. WLC conveyed its interests to Windermere Real estate/S.C.A., Inc. in March, 2008 for adequate consideration. As such, WLC is improperly named as a defendant in this matter.
An ORDER OF DEFAULT RE DEFENDANT CHRISTOPHER JUDD is filed on March 29, 2010
WINDERMERE S.C.A. AND WASHINGTON LOAN COMPANY REFUSE TO PROVIDE DISCOVERY
A MOTION TO COMPEL DISCOVERY FROM WASHINGTON LOAN COMPANY, INC. AND WINDERMERE REAL ESTATE/S.C.A., INC. is filed on August 19, 2010, by Plaintiffs Repass, stating in part under:
RELIEF REQUESTED
Pursuant to CR 37(a)(2) and (4) of the Civil Rules for Superior Court and LR 37, plaintiffs move for order compelling responses to discovery and for terms against both defendants, Windermere Real Estate/S.C.A., Inc. (“Windermere Realty”) and Washington Loan Company (“WLC”). Separate sets of discovery were served upon counsel for both defendants several months ago. To date, responses have not been provided after several extensions and accommodations. Specifically, the following deficiencies exist:
1. Plaintiffs’ First Set of Interrogatories and Requests for Production of Documents to Windermere Real Estate/S.C.A., Inc. No written responses to interrogatories or requests for production have been provided. What documents have been produced do not allow anyone to determine what, if any, requests for production they are intended to relate.
2. Plaintiffs’ First Set of Interrogatories and Requests for Production of Documents to Washington Loan Company, Inc.
a. No responses to any requests for production;
b. No signed verification as provided.
FACTS
The same attorneys represent both Windermere Realty and WLC. Separate sets of the above discussed discovery were served upon counsel, Lars Neste and David Daniel of the Demco Law Firm, P.S. via U.S. Mail on April 22, 2010. Responses to both sets of discovery were due May 27. No responses were received. On June 1, a CR 37 conference was held with the defendants’ attorney regarding both sets of discovery. By email on June 15, attorney Daniel provided responses to WLC related interrogatories. Documents from WLC were promised shortly; they have never been provided. Responses to the Windermere Realty discovery were not provided, but were promised the following week. Although some documents were produced by Windermere Realty, no written response to the Windermere Realty discovery has ever been provided and what documents were provided were not identified as responsive to any particular request or interrogatory. Consequently, plaintiffs cannot determine whether compliance has been made to any Windermere Realty request for production. CR 34(b) requires documents produced to be organized and labeled to correspond with categories produced, which was not done either.
On August 31, 2010, the court filed an ORDER GRANTING PLAINTIFFS’ MOTION TO COMPEL DISCOVERY FROM WASHINGTON LOAN COMPANY, INC. AND WINDERMERE REAL ESTATE/S.C.A., INC.
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JUDGMENT DEBTOR, WINDERMERE CEO GEOFF WOOD’S WINDERMERE RELOCATION “…ABANDONED AND VACATED THE PREMISES” IN BREACH OF OFFICE LEASE, “…AMOUNT OF ALL DAMAGES IS $168,597.30…”
In Complaint No. 09-2-12257-1 SEA, Filed in King County Superior Court on March 12, 2009, Plaintiff Legacy Partners states:
"1. Defendant Windermere Relocation, Inc., is a Washington corporation, doing business in this state and county.
5. Defendant leased the Premises from Plaintiff for the purpose of operating a commercial business.
6. Defendant has abandoned and vacated the Premises. Although Defendant’s rent is current, it has anticipatorily breached the lease by informing Plaintiff that it will be abandoning and will not be continuing to perform its obligations under the lease.
7. As a result of Defendant’s default, Plaintiff will suffer monetary damages. Plaintiff is entitled to accelerated rent and CAM charges through the term of the Lease. The amount of all damages is $168,597,30, as detailed in Exhibit A.”
Filed October 27, 2009, ORDER AND JUDGMENT ON ANSWER OF GARNISHEE AND ORDER TO PAY.
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The Windermere Real Estate Relocation Rape Case:
Court Declares that Windermere "...condoned a rape by a business colleague..."
Editorial Preface: The incredibly violent and insidious psychological ramifications of rape, connected through an “abusive work environment” serves as an unfortunate yet credible subtext for the way in which Windermere Real Estate treats employees and damaged customers alike: Windermere’s application of aggressive, wasteful and mendacious litigation to stall and ruin innocent consumers, serves as the coercive metaphor of corporate power and arrogance: Windermere has no concern for the social damage it has done to people or communities. It cares only about how to manipulate the law and the courts to avoid any legal responsibility.
(Above L to R) Windermere CEO Geoff Wood (far left) is currently listed as a Governing Person of Windermere Relocation. Peggy Scott (second from left), also a current Governing Person of Windermere Relocation, "... did not give Little any advice about going to the police, and she did not conduct an investigation of Little's complaint or any follow-up interview with Little." Windermere General Counsel, attorney Paul Drayna (third from left) is listed as the registered agent of RELO LLC, the current entity name of Windermere Relocation. Windermere Founder John W. Jacobi (fourth from left) along with Gayle Glew (far right) are listed as Governing Persons of Windermere Relocation during the Little case. Glew told Ms. Little he did not want any "clouds in the office," and subsequently, after she would not accept a pay cut, that she should clean out her desk.
All citizens who abhor such treatment of women in the workplace should recall Maureen Little v. Windermere Relocation when choosing real estate services. WindermereWatch visitors will also want to read the United States District Court of Appeals Ninth Circuit's Order and Amended Opinion from the Little case.
Summarized and excerpted from a decision by the U.S. Court of Appeals
Maureen Little was employed by Windermere Relocation Services (“Windermere”) as a Corporate Services Manager, a position that required her “to develop an ongoing business relationship and relocation contacts with corporations in order to obtain corporate clients needing relocation services for their employees.” Until she was terminated, she received only positive feedback from her supervisors. Windermere’s records confirm that during the relevant period, Little had the best transaction closure record of all corporate managers by a large margin.
Unlike the other managers, Little’s employment contract provided that Little would receive $2,000 monthly, plus a $1,000 monthly override and $250 per closed sale. The override was based on the assumption that Little would close four transactions per month, with a provision for rollover when she did not make the target. According to Windermere President Gayle Glew, the other managers had not received the $1,000 override.
One of Windermere’s clients was the Starbucks Corporation. Some time in 1997, Little performed some relocation services for Starbucks Human Resources Director, Dan Guerrero, on a contract basis, and she learned from him that Starbucks was dissatisfied with its primary relocation provider. Glew told Little that he would “do whatever it takes to get this account” and that Little should “do the best job she could.” Thus, little believed that, as part of her job, she was to build a business relationship with Guerrero to try and get the Starbucks account, and she had at least two business lunches with Guerrero toward this end.
On October 14, Little accepted Guerrero’s invitation to discuss the account at a restaurant. After eating dinner with Guerrero and having a couple of drinks, Little suddenly became ill and passed out. She awoke to find herself being raped by Guerrero in his car. She fought him off and jumped out of the car, but again she became violently ill. Guerrero put her back in the car and took her to his apartment, where he raped her again. Little fell asleep, and when she awoke he was raping her again. Afterward, he showered and drover her to her car.
Little was reluctant to tell anyone at Windermere about the rape because, in her own words, “I knew how important the Starbucks account was to Mr. Glew. Mr. Glew would ask me on a consistent basis the status of the account and I was afraid that if I told him about the rape, he would see me as an impediment to obtaining the Starbucks account.” This belief was reinforced when, a few days after the rape, Little reported the rape to Chris Delay, Director of Relocation Services (apparently not one of Little’s supervisors), and Delay advised her not to tell anyone in management. Little believed that Delay feared “what might happen to [Little] if [she] did tell.”
On October 23, about nine days after the rape, Little reported it to Peggy Scott, the Vice President of Operations, who was designated in Windermere’s Harassment Policy as a complaint-receiving manager. Little described Scott’s response:
She came out around the desk and I could tell she was upset and she just gave me a hug and said she wished there was something she could do. She didn't understand what I was going through. She asked me if I was in therapy. Then she proceeded to tell me she wouldn't say anything to [Glew] unless I proceeded to seek legal action [against Dan Guerrero].
Scott told Little that "[s]he thought it would be best that [Little] try to put it behind [her] and to keep working in therapy," and that she should discontinue working on the Starbucks account. She did not give Little any advice about going to the police, and she did not conduct an investigation of Little's complaint or any follow-up interview with Little. Scott testified in her deposition that, because the rape occurred outside the "working environment," she believed that it fell outside the scope of Windermere's Harassment Policy.
Despite Little's supposed removal from the Starbucks account, Glew continued to ask her about the status of the Starbucks account during the next six weeks. "[As of December 2,] Gayle was asking me questions about Starbucks ... a couple of times every month to see what the status was." Concerned by Glew's questions, Little told her immediate supervisor, Linda Bellisario, the Vice President of Sales and Marketing, on December 2, 1997, about the rape. Little had been reluctant to tell Bellisario because she "felt that [Bellisario] would immediately go to Gayle and Gayle would terminate my position.... I knew how much this account meant to him. He said he would do whatever it took to get this account." Bellisario told Little to inform Glew of the incident.
When Little told Glew of the rape, which, according to Glew, was the first he had heard of it, Glew's" immediate response was that he did not want to hear anything about it." He told Little that she would have to respond to his attorneys. Glew then informed her that he was restructuring her salary from $3,000 monthly to $2,000 monthly plus $250 per closed transaction. The pay reduction was effective immediately and non-negotiable. Bellisario, who was present at that portion of the meeting, appeared "surprised and upset" to Little.
Little found the pay cut unacceptable, and Glew told her to go home for two days to think it over "because he did not want any `clouds in the office.'" When Little still found the pay cut unacceptable two days later, Glew told her it would be best if she moved on and that she should clean out her desk.
Little brought suit against Windermere, alleging unlawful discrimination and retaliation in violation of Title VII, 42 U.S.C. § 2000e, and the Revised Code of Washington § 49.60; wrongful discharge in violation of public policy; and intentional, reckless, and/or negligent infliction of emotional distress. The district court granted summary judgment in favor of Windermere on all four claims.
Little appealed dismissal of her claims, and the appeals court reversed in part, and ruled:
In sum, taking the facts in the light most favorable to Little, because her employer effectively condoned a rape by a business colleague and its effects, Little was subjected to an abusive work environment that "detract[ed] from [her] job performance, discourage[d] [her] from remaining on the job, [and kept her] from advancing in [her] career[]."
Incredibly, Windermere asked for a rehearing, but "...the panel has voted to deny the petition for rehearing and to reject the suggestion for rehearing en banc.
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WINDERMERE: AMERICA'S PREDATORY REAL ESTATE ENTERPRISE
Consumer advocates, legal experts and elected lawmakers all agree that the American real estate industry demands greater regulation to protect consumers from the human disaster of real estate fraud perpetrated by unethical realtors employed at companies like Windermere Real Estate. Windermere manipulates our clogged, inundated courts and the justice system to stall, wear down and financially exhaust victimized consumers, many of whom are wiped-out by the cost of pursuing civil justice in a process where innocent victims must CHASE perpetrators of real estate fraud through the courts AFTER a fraudulent offense has been committed. Acts of fraud are so common and widespread throughout the Windermere real estate network, that the defense of real estate fraud has become has become just another bottomline expense on the Windermere balance sheet. And the litigation nightmare of real estate fraud can happen to anyone who deals with Windermere Real Estate. It could happen to you. Windermere is by far the most unethical, deceitful, and culturally toxic real estate company operating in the United States. Windermere knowingly, deliberately, and unabashedly profits on corrupt franchise owners, brokers and agents with proven histories of fraud and ethical misconduct, many of whom are profiled in the pages of WindermereWatch.com. Despite Windermere's well-documented assault on victim speech rights, more and more unconscionable cases of Windermere fraud continue emerging.
Windermere is headquartered in Seattle, at franchiser Windermere Services Company. It was founded by John W. Jacobi, and he has kept the company a private, family-owned enterprise, eluding the transparency and ethical accountability required by stockholders. For decades, Windermere has harnessed the art of positive PR, affixing itself—however superficially—to community art events, the homeless, and even an annual college rowing competition which opens Seattle's boating season—the Windermere Cup—irresponsibly promoted by, and in conjunction with, the University of Washington. But those are the disingenuous and cynical sideshows created by an adept market manipulator, shown only briefly to the public, to obscure and obfuscate Windermere's true predatory nature.
FRANCHISER WINDERMERE SERVICES' MANAGEMENT TEAM AND DESIGNATED GOVERNING PEOPLE: EXPERTS IN MARKETING FRAUD, ABUSE OF THE LEGAL PROCESS, AND AT COERCING DAMAGED WINDERMERE CLIENTS INTO SILENCE BY SUPPRESSING THEIR SPEECH RIGHTS
The shameless greed and repugnant ethics of Seattle's Jacobi family, deliberately profiting on the loss and suffering of Windermere victims through commissions on the fraudulent home deals and unlawful misconduct of dishonest Windermere agents, brokers and franchise owners. Forget human decency, commercial reputation or social responsibility—it's all about the money.
Before turning the business over to his children and son-in-law, Windermere founder John W. Jacobi (left) simply ignored any complaints of fraud from Windermere victims, sending them straight to the lawyers. Yet despite claims of retirement, Jacobi is still indeed quite active at franchiser Windermere Services Company:
In Complaint 10-2-36192-8 SEA, filed in King County Superior Court on October 12, 2010, Windermere Services Company has sued former Windermere Puyallup Canyon Road owner Joe Maxwell for default on an “Unconditional Guaranty of Payment” promissory note. The Maxwell Answer and Counterclaims state that the “Plaintiff's [Windermere Services Company] claims are barred by Plaintiff’s fraud, duress, and unclean hands,” and alleges $4,000,000 in damages and violation of Washington's Franchise Investment Protection Act; and also that "The alleged Note and Guarantee are unconscionable and unenforceable." Maxwell's Counterclaims state "6. The WPCR Operating Agreement contains a provision granting Jacobi a special veto power which among other things, states that the company shall conduct its business and manage its affairs in accordance with the directions of Jacobi and all management decisions are subject to Jacobi’s review," and "13. In early 2006, WSC and Jacobi decided to open another WSC office in the territory in which WPCR was operating, despite the objections of Maxwell. As a result of the opening of this new WSC office, WPCR lost a significant number of its real estate agents and revenue that transferred to the new office in Graham, Washington," and "14. As a direct result of these actions taken by WSC and Jacobi, WPCR was left with a large debt burden and overhead, and WPCR’s revenue was significantly reduced... 22. On September 14, 2010, Maxwell heard from a real estate agent working at WPCR that the agent had received and email from WSC notifying him WPCR’s franchise had been terminated. This notice was sent to WPCR’s real estate agents before Maxwell learned of the termination of WPCR’s franchise." Read the complete report on this case here.
Jacobi's Washington Loan Company is also currently being sued for Intentional Misrepresentation—read that report here. And the Windermere affiliated service company, Commonwealth Land Title Company of Puget Sound, has recently been found negligent by a jury who awarded the third-party plaintiffs $1,190,000. Read the Commonwealth report here.
Current Governing Person and Windermere Services Company CEO Geoffrey P. Wood (left) is married to John W. Jacobi's daughter, Jill Jacobi-Wood. Wood is the chief architect of Windermere marketing fraud, inducing business volume through—among other fraudulent promotion—an express warranty of "The highest ethical standards. Uncompromising honesty and integrity." When called upon to honor his company's warranty, Wood instructs Demco lawyers—led by Matthew F. Davis–to sue vocal victims for libel and defamation. Wood is also a Governing Person of Windermere Relocation, the subject enterprise of Windermere's employee rape case. He was briefly a real estate sales person in 1994, but that license was CANCELLED in 1995, and Wood currently has no real estate license of any kind that WindermereWatch can find.
Governing Person Jill Jacobi-Wood (left), Windermere Services President, is a licensed real estate broker in Washington State, and as such is subject to the statutory condition of RCW 18.86.030 "(d) To deal honestly and in good faith." For her part in Windermere's marketing fraud and malfeasance, Jacobi-Wood's RE license should be cancelled by the Washington State DOL's real estate division. By promoting honesty and integrity—while in reality—she is suing and coercing Windermere victims to shutup about their Windermere experience, Jacobi-Wood is hardly dealing honestly and in good faith.
Governing Person John O'Brien "OB"Jacobi (left) is General Manager of franchiser Windermere Services Company and also has many Windermere realty brokerage offices. He's a licensed real estate broker who is also called upon by statutory law to "Deal honestly and in good faith." But John "OB" Jacobi instead promotes fraudulent claims of honesty and integrity, and falsely sues victims of Windermere misconduct for libel and defamation to intimidate them and coerce their silence. Then this junior Jacobi runs away and voluntarily dismisses his own mendacious lawsuit when a victim refuses to sign Windermere's dark clause settlement agreement that has cost the victimized party so much distress and money and to defend.
Windermere Services Governing Person and attorney—WSBA# 26636—Paul Drayna (left) has even more stringent ethical requirements placed upon him through his collateral professions of Lawyer and Notary Public; and Drayna is also bound by the Model Rules of Professional Conduct. But Mr. Drayna is not just practicing marketing fraud at Windermere. As Windermere in-house counsel, Drayna oversees Windermere's legal strategy of abusing process by falsely suing victims for libel and defamation, and then attempting to intimidate and coerce those victims out of their speech rights and into Windermere's Dark Clause silence agreement. When victims WON'T sign the Windermere Dark Clause, Drayna runs away too, and voluntarily dismisses his own company's lawsuit under Civil Rule 41—but only after first costing the victim thousands to defend the phony lawsuit. Drayna is even copied on the mendacious, Demco-authored settlement documents meant to quash speech rights and be signed by Windermere victims.
WINDERMERE'S DEMCO LAW FIRM: ESCHEWING ETHICS and DOING WHAT OTHER LAWYERS JUST WON'T DO
Attorney and multi-office Windermere broker John Demco (left) is the ethically-elastic Windermere kingpin lawyer who operates Demco Law, Windermere’s in-house legal firm, whose primary job is to stall and outspend small fry consumers damaged by dishonest Windermere brokers, agents and franchise owners. When an innocent real estate consumer has the misfortune to suffer one of Windermere’s many bad apples, Demco Law Firm will refuse to settle the matter forthrightly, no matter what conspicuously unlawful or offensive conduct the agent or broker has committed. Demco and Windermere will force the aggrieved party to sue or swallow their damage and go away—standard Windermere operating procedure.
WindermereWatch has compiled voluminous evidence that Windermere-Demco attorney Matthew F. Davis (left), WSBA# 20939, is the kind of lawyer about which jokes are coined. Davis is franchiser Windermere Services' frontline bully—the guy in the legal trenches actually wrecking lives, making threats, and suing victims who speak out. When Shakespeare was recommending "The first thing we do, let's kill all the lawyers," in Henry the Sixth, Part 2, he was talking about egomaniacal lawyers like Matt Davis.
Attorney Matt Davis of Windermere's Demco Law Firm is so unethical, so deceitful and intimidating, that he's famous in law circles. As Windermere-Demco's lead attorney, Matthew F. Davis is renown for his dishonesty, dubious legal tactics, lack of decency and disrespect for the rules of professional conduct. He will do absolutely anything to win—without regard for truth or justice. He will lie to courts and opposing parties. He will file fallacious and erroneous documents with the court. He will email opposing parties telling them not to hire a lawyer when he has just served them a lawsuit. He will call a judge's chambers and request more time without informing the opposing party. He will file orders for a bench trial when he knows a jury trial has been demanded and paid for. He will trick, stall, coerce, menace and threaten. He will invent and extend mendacious Windermere litigation and abuse the legal process for no other reason than to exhaust an opponent’s pocketbook. If he can, he will get YOUR attorney to quit—a favorite tactic.
Windermere, Davis and Demco Law will push a $5 cat poop case all the way to the state supreme court just to avoid paying damages—because it’s all in the Windermere operating budget. And in the end, Windermere and Davis will try to coerce silence about your Windermere experience by trying to make you sign a "settlement" agreement that terminates your speech rights, so you can't ever inform the public about your Windermere debacle. What if you DON'T sign that you'll shut up, and then SPEAK UP instead? Windermere-Demco's Matt Davis will sue you for libel and defamation, then run away and dismiss his own lawsuit on the eve of trial—because after all—you're telling the truth.
Windermere's Clear and Overt Marketing Fraud:
"THE HIGHEST ETHICAL STANDARDS. UNCOMPROMISING HONESTY AND INTEGRITY."
—The Windermere Real Estate Mission Statement
Windermere widely promotes its deceptive express warranty in sales documents and on the internet which states "We are committed to... The highest ethical standards. Uncompromising honesty and integrity." In other Windermere promotion, like the Puget Sound Business Journal, Windermere CEO Geoff Wood is quoted as saying "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." The article goes on to say, "Geoff oversees marketing, legal, financial and internet development services throughout the Windermere network..." Mr. Wood claims absolute dominion over both Windermere legal and internet strategy, making him chief architect of Windermere marketing fraud.
Effective reportage can be harsh in recounting facts, but it must be said in consideration of all the Windermere victims profiled here who truly sought Windermere's vaunted honesty and integrity, that Windermere Services CEO Geoffrey P. Wood is simply lying when he states his company's utterly false and fraudulent commitment to honesty and integrity. He both lies and deceives again when he says that "In the real estate business somebody's word is very important. If you say you're going to do something, you've got to do it." Wood clearly doesn't do what he says he's going to do—be committed to uncompromising honesty and integrity. Wood himself is indeed IN the real estate business and his word is absolutely no good at all. He sues victims of Windermere misconduct for trade libel and defamation to shut them up, and then he tries to use the legal system to suppress victims' speech rights when they ask him to actually perform on the warranty he promotes. As this website proves, Mr. Wood does anything BUT what he says he's gonna do. Far from providing victimized Windermere customers a commitment to high ethical standards, honesty and integrity, Wood and Windermere run away and hide behind their lawyers when innocent consumers are ruined by their Windermere experience.
John W. Jacobi, Geoff Wood, his wife Jill Jacobi-Wood, and governing cohorts John O'brien "OB" Jacobi and attorney Paul Drayna have gone to the absolute ends of the earth in stonewalling, ignoring, denying and fleeing any and all responsibility for Windermere wrongdoing and misconduct. When called upon by victimized Windermere consumers to make good on its warranty of honesty and integrity, Windermere even states in legal pleadings that Windermere agents are NOT agents of Windermere at all—but independent contractors. As the legally-designated Governing People and top managers of the Windermere empire who drive policy, ethics and market promotion, it demands repeating that John W, Jacobi, Geoff Wood, Jill Jacobi-Wood, John OB Jacobi and attorney Paul Drayna are all clearly lying when they promise high ethical standards and uncompromising honesty to the public and consumers of real estate services.
Protect your life, home, family and future by cancelling or not renewing your Windermere listing. Don't risk doing business with Windermere Real Estate, the brand built on lies, fraud and ruined lives. Refuse to fund public predator Windermere Real Estate with commission from the sale of your home.
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Is WindermereWatch.com of social benefit to consumers and the public? You decide:
Windermere Real Estate is one of our country’s largest real estate companies and widely promotes a fraudulent express warranty that states “We are committed to... The highest ethical standards. Uncompromising honesty and integrity.” The definition of an express warranty from Black's Law Dictionary is: "A warranty created by the overt words or actions of the seller. • Under the UCC, an express warranty is created by any of the following: (1) an affirmation of fact or promise made by the seller to the buyer relating to the goods that becomes the basis of the bargain."
But when customers are victimized by dishonest Windermere brokers and agents, and complain in writing through legal counsel to franchiser Windermere Services Company, it is absolutely silent in the face of clear and convincing evidence, and forces the customer to sue or go away. In many cases, unsuspecting consumer lives are thrown into complete chaos through costly litigation; and also because the subject homes may actually be uninhabitable or unserviceable for reasons about which Windermere knew and had a legal obligation to disclose—but did not. For some victims, the long and expensive litigation forced upon them even results in bankruptcy and homelessness. Despite their clear evidence, many victims go on to lose in court because they can't afford attorneys or have no legal experience, and Windermere exploits those impediments to endless advantage—lives, homes, and personal finances are ruined forever. And Windermere expects those victims to just go away without their lives and homes, merely for buying a house through Windermere Real Estate, innocently.
Although such irrefutable evidence of Windermere broker/agent misconduct has been presented to franchiser Windermere Services Company, it knowingly continues collecting commissions from dishonest agents and brokers by deliberately passing them on to other unwitting consumers. Just one example is Windermere S.C.A. Redmond's Paul Stickney, who received a $522,200 court judgment for not disclosing a conflict of interest, but is still producing commissions for his Windermere SCA franchise, and Windermere Services Company. Is that the "Highest ethical standards. Uncompromising honesty and integrity?" You may want to search and visit more websites about Windermere's predatory business conduct.
When victims use the media to report their Windermere experiences honestly, Windermere sues them for libel and defamation through false lawsuits to intimidate, silence, and hush bad PR—read one of those lawsuits here. It then tries to coerce victims into signing a “dark clause settlement agreement” that permanently terminates their speech rights—read some of those "settlement" agreements here. Through an expensive and emotionally distressing roller coaster ride with Windermere's nasty Demco lawyers, a victim of Windermere fraud is told they will be taken all the way to trial on trumped-up libel and defamation charges, and if they don't sign the dark clause, their life and future will be ruined. When a victim persists in refusing to sign, Windermere voluntarily dismisses its own lawsuit under Civil Rule 41, just before trial, after costing the victim years and yet thousands more to defend against the false action. This predatory legal tactic is known as abuse of process or malicious prosecution. In one example cited below, franchiser Windermere Services Company served an outspoken victim a lawsuit for libel and defamation, and then immediately sent them an email instructing that they "...need not hire an attorney," and further stating, “…we will try to resolve this directly and outside the legal system.”
Every Windermere office in every state is legally tied to franchiser Windermere Services Company's fraudulent express warranty, false advertising, predatory conduct and policies through privity and its pecuniary franchise agreement. Some legal observers believe that Windermere's conduct has RICO and Civil Rights violation implications. If you have recently purchased a Windermere franchise without having been disclosed Windermere's falling brand value, PR decline, and its adverse website problems, click here for its duty of disclosure under Federal Trade Commission rules. Proof that Windermere Services Company knew about WindermereWatch.com in March of 2007 is in this document.
Windermere Real Estate is a textbook corporate predator who operates franchises in Washington State, Oregon, California, Arizona, Nevada, Utah, Idaho, Montana, Hawaii and British Columbia. Windermere repeatedly makes the false claim that it has offices in Wyoming, but it does not. If you’re buying or selling property through ANY Windermere office, a percentage from your transaction will be used by franchiser Windermere Services Company to silence and financially ruin innocent parties who’ve encountered Windermere fraud. Windermere won't pay legitimate damages or acknowledge wrongdoing, and will stall settlement of cases all the way to state supreme courts, a legal strategy that Windermere routinely employs to bankrupt victims and exhaust their resources.
We believe the information presented here is of profound social benefit to consumers and the community, and we are dedicated to providing it.
THROUGH FEES AND COMMISSIONS PAID TO FRANCHISER WINDERMERE SERVICES COMPANY, EVERY WINDERMERE NETWORK OFFICE IN EVERY STATE IS AN ENTHUSIASTIC PARTNER AND KNOWING ACCESSORY TO WINDERMERE MARKETING FRAUD AND ITS PREDATORY POLICIES