Kimberly Miller, Palm Beach Post
GMAC mortgage says it has spent more than $1.5 million to recover and transfer foreclosure files previously handled by the Plantation-based Law Offices of David J. Stern, which the lender fired in November.
The dollar figure is listed in a counterclaim filed by GMAC last month against Stern, who is suing to collect back fees for work the firm did on GMAC foreclosures.
But GMAC says the firm’s work was so flawed _ even charging legal malpractice _ that new attorneys assigned the cases were forced to re-initiate foreclosure proceedings due to concerns over documents previously filed by Stern’s firm.
“GMAC has since learned that DJSPA (David J. Stern, P.A.) committed gross malpractice in the handling of GMAC matters,” the counterclaim says. “DJSPA negligently, recklessly and/or wantonly breached its professional duties.”
GMAC was one of the first lenders to freeze its foreclosure operations last fall when it acknowledged flaws in its foreclosure procedures, including the use of so-called “robo-signers” to verify documents.
And while GMAC blames Stern in its counterclaim, its own employee, Jeffrey Stephan, was also signing flawed documents.
Stephan was charged with ensuring foreclosure paperwork was accurate and the proceedings justifiable by signing off that he had personal knowledge of the case.
Although the foreclosures may have been warranted, Stephan acknowledged under deposition that he did not have personal knowledge of the estimated 10,000 foreclosure cases he signed every month. Also, the notary affirming the signature was not always present during the signings, sometimes catching up a day later.
When GMAC learned of questionable practices at the Stern firm, including from depositions taken of Stern employees by the Ice Legal team of Royal Palm Beach, the counterclaim says it terminated its relationship with the firm on Nov. 16.
A response from Stern to GMAC’s counterclaim denies allegations of wrongdoing, and says that part of GMAC’s problems stem from its own failure to promptly obtain new counsel after firing Stern.
