Court refuses to sanction GMAC
The Maine Supreme Judicial Court yesterday ruled against holding mortgage giant GMAC in contempt for signing off on a home foreclosure without reviewing the documents.
In a 5-1 decision, the Supreme Court upheld the Maine District Court's decision not to impose sanctions on GMAC or Fannie Mae or find either in contempt, according to the Portland Press Herald. The case began last year after Fannie Mae attempted to foreclose on a Denmark home owned by Nicolle Bradbury, and a GMAC employee admitted in deposition to signing as many as 10,000 documents a month without reading them in order to speed up foreclosure processes. All 50 states launched investigations into foreclosure mismanagement and GMAC, as well as other mortgage companies, agreed to temporarily freeze foreclosure proceedings.
The district court last September found GMAC acted in bad faith and ordered the company to pay Bradbury's attorneys nearly $24,000, but decided not to hold GMAC in contempt or impose other sanctions. The Supreme Court upheld that decision, finding that there is no precedent of a court issuing a finding of contempt based on bad-faith affidavits, the paper reported.
A class-action lawsuit brought against GMAC by Maine homeowners over its foreclosure process is still pending, although in February a U.S. District judge dismissed two of the three counts. GMAC still faces one count of violating the state's Unfair Trade Practices Act, for which it could be held liable for damages.
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