SAN FRANCISCO, CA – A mortgage bank sued a mortgage broker and settled. After the broker failed to make the agreed-upon settlement payment, the mortgage bank sued the individuals in control, alleging the individuals stripped the company of its assets. Plaintiff Rescap Liquidating Trust specifically alleges that the individuals in control of First California Mortgage Company (“FCMC”) were transferring assets away from the FCMC before, during and after signing the settlement agreement. Violation of the Uniform Fraudulent Transfer Act are alleged, among other torts.
Collection is always an issue, at the beginning of a case and, as this case points out, at the end. Prosecuting a lawsuit is exhausting, economically and otherwise. Imagine going through that process, winning and having to file another lawsuit and go through it again, as is being done here. Not fun.
A good plaintiff’s lawyer considering taking a contingency fee case will consider collectability and not take the case if there is a risk of winning with no reward. Plaintiffs paying hourly should go through the same mental exercise and analysis. Lawsuits are investments and only worth it if there is a strong likelihood of a positive return. If the risks are too great, that same money should be put in a mutual fund instead.
Plaintiffs should name companies and individuals where possible, explore provisional remedies, like writs of attachment and, when settling, explore personal guarantees and/or securing property/assets.
|This blog reports on cases filed in and around the San Francisco Bay Area. The statements made are based on the allegations in court-filed documents. Allegations are just accusations, and may or may not be true.|
|The authors of the blog are attorneys at the San Francisco litigation firm, Wood Robbins, LLP. If you have a legal issue, send them an email. If they cannot help you, they will try and point you in the right direction.|