professional liability fund

8/8/2019 professional liability fund

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January 4, 2077WIEEEa$ffi $4 KwltffiaclFr*fessi*slaE LEah&!Etg Feimd3"6ff37 SW t"$pp*r ffi**r:*s F*x"rtrr ffi'#FS S*x 2336SST6gard *R S?3Sg

Re: Lauren Paulson/Fairway/FHLF, LLC and othersDear Mr. Kwitman:

This is a demand letter.THE M. E. BLANTON HOUSE LOAN

Fairwav's FollvThis lender-fiasco is the poster child of predatory loans. It is theposter child of lender bad faith. The predatory crown jewel for FairwayCommercial Mortgage Corporation (Fairway) lies in its illegalnonjudicial foreclosure by Fairway's subsidiary, FHLF, LLC, onSeptember 25, 2009.It is a tale of attorney negligence, attorney malpractice andattorney hubris .....on a grand scale by'white-shoe'Portland law firms.Sadly, it demonstrates our legal system at its worst, governedby a judiciary that has only a vague allegiance to Due Process and TheRule of Law. This case demonstrates a judiciary with no empathy todebtors a nd blata nt bias towards their'brothers/sisters-in-arms'.Fairway's Folly is marked by their assignment of The Mortgage toFHLF, LLC, and their concomitant failure to assign The PromissoryNote. This mistake vitiates the secured interest in the property andviolates the Uniform Commercial Code. It violates a settled rule of

law in the United States since the 17th Century: -- A mortgagefollows the promissory note, but a promissory note does notfollow a mortgage. No attorney picked up on this. None of theFourteen (14) judges that have been involved in the six (6) judicialforums on this case have picked up on this. The Bankruptcy Court andits cadre of Trustees didn't pick up on the issue. The Ninth Circuitdidn't care. Only the victim, Lauren Paulson, finally became aware ofFairway's Folly and brings it to your attention now.


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These lawyer's malpractice insurance carrier was alerted severalmonths ago to the fact that FHLF, LLC has no standing before any ofthese courts. They did nothing, probably due to the'white shoe'factor. Yet, Oregon Federal District Court Judge Garr King ruled in acase exactly on point with this set of circumstances, in favor of thedebtor, on October 6th, 2070.

Illeqal ForeclosureThus, FHLF, LLC's foreclosure of September 25, 2009 is patentlyillegal. FHLF, LLC did not hold the promissory Note when theyforeclosed. The law across the United States requires that the Note beendorsed to and possessed by FHLF, LLC before they foreclosed. Thatdidn't happen. This means that FHLF, LLC did not have legal standingto foreclose. Standing is jurisdictional and cannot be waived.There are dozens of cases coming down throughout the UnitedStates that hold uniformly the Note must be endorsed and delivered tothe assignee, here, FHLF, LLC. If the Note is not so endorsed anddelivered, that breaks the chain of title and any foreclosure by anassignee of the deed of trust without also being the legal 'holder'ofthe Note is void. There are no cases otherwise, Moreover, the entitywithout constitutional standing cannot subsequently establish a validassignment, Humpty Dumpty cannot be put together again.

SETTLEMENT LETTERThis solicitation for an offer to settle is open for 30 daysfollowing the date of this letter. A comprehensive discussion of theoverall liability of the parties has been previously furnished to some ofyou in the form of a thirty four (34) page class action complaint datedNovember 4,2010. This complaint will be filed immediately if this caseis not settled forthwith,Discussion

1. FHLF, LLC, as discussed above, has made the grievous mistakeof conducting a nonjudicial foreclosure on September 25,2009when they were not the Holder of the promissory Note asrequired by law. This alone voids the foreclosure sale andstrips the lender of security.But, the team of Matt Burk, CEO of Fairway and their attorneys,Greg Blair, Joel Parker, and Craig Russillo conspired to make other

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fraudulent acts (in addition to allowing an Order of Default in theDistrict Court case) as follows:. The Stay Attorney Joel Parker as successor trustee failed

to obtain relief from the automatic stay of my bankruptcybefore proceeding with the foreclosure. A successor trusteebecomes a stakeholder in a bankruptcy proceeding exactlylike FHLF, LLC. The latter obtained a relief from stay, theformer did not.. The Required'Warning" Notice-- Attorney Craig Russillofailed to provide the'warning'notice to me as required byORS 86.737, This means Paulson has five years to redeemthis property as allowed by ORS 88.030. The Riqht to Cure Attorneys Parker and Russillo conductedthe September 25, 2009 foreclosure without providingPaulson with the right to cure up to five days before the saleas required by ORS 87.753. The Required Notice of Sale Parker and Russillo did notgive actual notice prior to the foreclosure sale as required byORS 86.742 et seq.

2. Fairway Commercial Mortgage Corporation, Matt Burk,Greo Blair, Joel Parker and Craio Russillo conspired to'dehorse'Paulson from this property. They did this byunstealthy (possibly criminal) fraud: At the very least Fairwayhas committed fraud on the courts. In addition, there has beenblatant contractual bad faith: -- The Forbearance'Nonagreement', The Swenson sale, the El Mansey sale, theReverse Mortgage. It has not been pretty. The twenty seven(27) Count complaint recounts the horribles.

OfferThis is a solicitation for an offer to settle with the followingrequired components:. This offer to settle is contingent upon a full return of all ofPaulson's personal property under the supervision of aCourt-appointed mediator or master.. Fairway and FHLF, LLC/Skylands Investment Corporationand all Fairway subsidiaries including investors on thesematters shall reconvey the deeds of trust, provide astatutory warranty deed on all properties free and clear of


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all encumbrances along with a full and complete titlereport through First American Title Insurance Companyand Candace Brown as escrow agent. This transaction shallinclude a hold harmless agreement from Fairway toPaulson and mutual full and final releases of all claims.$100,000 liquidated damages shall be paid to Paulson bythe corporate defendants in the federal court Case No. cvOB-982-PK$100,000 liquidated damages shall be paid to Paulson bythe individual defendants in the same case.There shall be a return to Paulson of all rents collected byany Fairway entity from May, 2010 to present. All unpaidtaxes, utility bills and insurance must be paid from May 24,2010 to settlement date.There shall be an accounting and return of all Paulson'spersonal property in good repair to the exact place whereta ken.There shall be a written confirmation from an authorizeddefendant representative (Anne Helton would be preferred)that the confidential computer hard drive and otherconfidential documents have not been breached by anydefendant or party hired by defendants. In addition, thisrepresentative will certify in writing the return of all ofPaulson's personal property through the services of themediator discussed above and below. This defendantrepresentative shall also furnish all inventories andpaperwork in connection with the initial confiscation ofPaulson's personal property, into August, 2010 and topresent. The three vehicles taken by defendants shall beexamined by qualified mechanics to certify the condition ofthose vehicles upon return,Paulson's credit record shall be corrected and cleared of allthese matters.All client files shall be returned with confirmation that noclient or customer lists have been retained by anydefendant, person or party.

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. The parties will sign a joint stipulated dismissal of alllitigated matters without costs or fees to any party,. The parties will stipulate to vacate all extant orders andjudgments in all forums without costs or fees to any party,Time is of the essence. If settlement discussions are notcomplete within 30 days of the date of this letter then any subsequentnegotiations will require an additional $1,000 per day increase inliquidated damages.Punitive Damages

This case has been marked by antagonism and acrimony notexceeded by any other matter of which paulson has ever beeninvolved. This offer to setile is conditioned upon respectful,business-like and polite setUement discussions mediated byRoxane G. Ashe, Circuit Mediator of the Ninth Circuit MediationProgram or surrogate. If anything of the sort of past falsenegotiations or posturing occurs, then all settlement overtures willterminate and litigation will be the only vehicle of resolution. punitivedamages will be sought in every authorized forum.

Under no circumstances will paulson negotiate direcily orindirectly with Matt Burk, Greg Blair, Joel parker nor craig Russillo.Thank you for your interest and consideration in these matters.

Very truly yours,

Lauren Paulson

professional liability fund

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