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Joel Sucher Headshot

Has Anyone Heard of the Uniform Law Commission?

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I hadn't, but I recently learned that this organization is taking its show on the road and will bivouac in Seattle on July 11th and there are some so unhappy with this visitation that they've decided to take to the streets in protest.

If you haven't heard of the Uniform Law Commission (ULC), you're probably in good company. I doubt many Americans know anything about this group composed mainly of business and real estate lawyers and now engaged in drafting something called the Home Foreclosure Procedures Act. It's an attempt to provide a model law that would "harmonize" the vastly different ordinances governing foreclosures throughout the fifty states and it's the sort of thing that causes activists like Karen Pooley to lose sleep. Karen is the one who first clued me in on the current work of the ULC and she'll be on the barricades outside the Westin Hotel on July 11th. Inside, members of the ULC drafting committee will be huddled in a closed door session to deliberate the ways and wherefores of the proposed law. For Karen Pooley, along with other anti-foreclosure activists, the Uniform Law Commission amounts to a secret society with a real goal of bending laws to conform to the shape and utility preferred by those in power, namely, bankers and other assorted financial services types.

The ULC is a private non-profit group of lawyers founded in the late 19th century with the stated goal to "promote uniformity in the law among the jurisdictions adopting the act," and their signature effort -- and most successful campaign -- was to get all fifty states to sign on to what's known as the Uniform Commercial Code (UCC) which made selling stuff between states a fairly uncomplicated affair. It wasn't easy. First proposed in 1940 it took some twelve years for a final acceptable draft to surface. Now they want to do the same with foreclosures but according to critics that will be an uphill fight, sort of like rolling a boulder up Mt. Everest.

If you take a look at the ULC website they seem to have done some laudable work in areas involving family law, probates and estates, but in the arena of real estate and real property their batting average has been close to zero. A couple of proposed uniform laws involving land transactions fell flat and a really horrendous effort to create a Uniform Non-Judicial Foreclosure Act failed to garner interest by any state legislature. The law was aimed at eliminating judicial foreclosures, overseen by the courts, in favor of a process where struggling homeowners would be offered up to the tender mercies of the banks and servicers, meaning that evictions would be very quick and very painful. It's for this reason that the current ULC effort has been met by skepticism in many consumer quarters.

Geoff Walsh, who writes about the foreclosure crisis for the National Consumer Law Center, isn't convinced that there's anything in the proposed statute to make homeowners want to stand at attention and salute. His sense is that the banks and servicers will cherry pick those provisions that are in their best interests and push for their inclusion - at the expense of consumer friendly provisions -- in key states where their lobbyists hold sway.

Alan White, on the other hand, is a committee member and lawyer with a long consumer pedigree. While acknowledging that fallout from previous ULC campaigns has tainted the present effort he believes that the current draft includes important homeowner protections like mandatory mediation (something the industry has strenuously opposed) along with consumer remedies that provide for damages and attorney fees.

But the devil is in the details and when it comes to evicting homeowners arguments abound about who has "standing" to foreclose, broken chains of title, improper assignments, "holder in due course"; all the verbiage and phraseology that surfaced in the wake of the 2010 revelations surrounding so-called robo-signing improprieties. In the past few years courts around the country -- federal and state -- have offered widely varying decisions on what this all means for struggling homeowners. For Geoff Walsh this is a bad omen for a one-size-fits-all foreclosure law so why put in the time and effort (Walsh mentioned NCLC's involvement in the previous unsuccessful Uniform Non-Judicial Foreclosure campaign).

It begs the question: why did the ULC decide to again dip its toes into this seemingly dead sea? Well, the answer may lie with the motives of Fannie Mae and Freddie Mac. Both have some financial skin in this game, each pledging $62,000 towards the work of the current committee, which makes sense since the Federal Housing Finance Agency which oversees Fannie and Freddie has historically pushed for quicker foreclosures, especially under the tenure of the deservedly maligned Dubya appointee, Edward DeMarco.

While the deliberations in Seattle on July 11th will be behind closed doors, William R. Breetz, who chairs the drafting committee has made it clear that outside comments are welcome and that meetings (with the exception of the one pending) are open to the public although when I went to the ULC site I couldn't discern when and where. In fact it seemed that entire web page was in dire need of a makeover and a good copy-read (yes, I found a typo). Any average Jane or Joe trying to slog their way through the various drafts and comments, including those offered by financial services heavyweights like the American Securitization Forum, will find it a tough road to hoe. It would also be helpful if the affiliations and job histories of committee members were listed alongside their names; something that was conspicuous by its absence. While three of the members, including Alan White, are credentialed consumer advocates the others seemed to be senior jurists in the twilight of their careers and gauging by their pictures many would do well as golf course extras in a Caddyshack sequel.

Melissa Hortman, a Minnesota state legislator and former legal aid lawyer and one of the three consumer advocates, believes that the committee is trying to get it "right" balancing the interests of both consumers and financial institutions but bemoans the lack of involvement by some consumer advocates. She does remain hopeful that they may return to the fold.

There is still a full year left. I think the committee is balanced, but I think the crowd of people who choose to attend our meetings and provide input is over-weighted toward financial institutions. It would be helpful if trusted voices for consumer interests would choose to participate in our process.

I really don't see the ULC as some sort of secret society on the order of the Knights Templar or the Bavarian Illuminati and while some conspiracy slingers may find parallels with Rockefeller's Tri-Lateral Commission or Prince Bernhard's Bilderberg Group I think the ULC scores pretty low on that particular scale. Frankly, I can't imagine these folks meeting deep in the forest dancing and prancing around a huge bonfire offering tribute to alien overlords in return for their help in maintaining an iron grip over the rest of humanity.

While I feel ULC's motives are fairly benign I can't say the same about their patrons or industry supporters and I think it a noble and needed effort that Karen Pooley and colleagues will be weighing in with their doubts and displeasure. My own feeling is something akin to President Reagan's in the wake of a 1987 arms control agreement with the Soviet Union.

Trust, but verify...

Joel Sucher, a filmmaker with Pacific Street Films is working on Foreclosure Diaries, a documentary about the financial crisis. He's written in the past for American Banker, and is a contributing blogger for Huffington Post and In These Times.