Marine veteran loses appeal in fight against foreclosure companies
By LYDIA GERIKE | The Oregonian | Published: August 9, 2018
A Vancouver, Wash. Marine who lost his home to foreclosure while on active duty waited too long to sue his mortgage and trustee companies, a federal appeals court has ruled.
It's another setback for veteran Jacob McGreevey. He contends that the Servicemembers Civil Relief Act, which shields servicemembers from foreclosure and other collections efforts, should have prevented PHH Mortgage and Washington-based Northwest Trustee Services from seizing his home in August 2010, between his third and fourth deployments to the Middle East.
McGreevey has 30 days from the July 26 ruling by the Ninth U.S. Circuit Court of Appeals to pursue another appeal with the U.S. Supreme Court. He said he's conflicted on what to do next.
Another appeal could potentially extend the case a couple more years, McGreevey noted. But should the high court agree to take on the case, he said, it might set a precedent to protect active servicemembers and veterans from going through what he faced.
"I still feel our case has a strong argument," McGreevey told The Oregonian/OregonLive.
McGreevey, who has acknowledged missing his payments, wasn't surprised when the companies foreclosed on his home in 2010. It wasn't until later, when he was studying business at Portland State University, that he learned about the Servicemembers Civil Relief Act.
The World War I-era law protects members of the military from foreclosure and other collections efforts while on active duty or within their first 12 months back.
When McGreevey suspected his foreclosure might have been illegal, he turned to Sean Riddell, his former commanding officer who had become a lawyer.
Riddell took the case, he said, hoping to bring retribution for McGreevey and secure broader rights for all servicemembers and veterans.
"It's a cause I care passionately about," Riddell said.
In 2016, Riddell filed a lawsuit against PHH Mortgage and Northwest Trustee Services in federal court. The suit claimed the companies violated the Servicemembers Civil Relief Act when they foreclosed on McGreevey's house two months after his third tour of duty.
The defense didn't address whether the home seizure violated the law. Instead, it focused on the time McGreevey took to file the lawsuit.
There was no official statute of limitations for this issue under the Servicemembers Civil Relief Act, so most courts looked to the most comparable state law to determine the deadline for filing a complaint. McGreevey's side believed it had six years to file, but the lender argued it was four years.
The courts have sided with the mortgage company to date.
This may be due, in part, to an amicus brief from the U.S. Department of Justice that supported a four-year statute of limitations, McGreevey and Riddell said. They believe the department contradicted its own policy, which should have given preference to McGreevey as a veteran.
"The SCRA should generally be read in favor of the servicemembers it is intended to protect," the Department of Justice website says.
McGreevey said he also blames U.S. Attorney General Jeff Sessions for not helping veterans.
"He gladly aligned himself with big business," McGreevey said.
Since the beginning of this fight, however, the government has accused Northwest Trustee Services, the largest foreclosure trustee in the Pacific Northwest, of illegally foreclosing on at least 28 military members or veterans. No case has been made against PHH Mortgage.
Riddell said the companies should not be allowed to avoid prosecution on a technicality.
"They broke the law," Riddell said. "I think there needs to be a legislative change."
McGreevey has at least one supporter in Congress who is trying to make that change happen.
U.S. Rep. Kurt Schrader, D-Oregon, introduced the Halting of Mortgage Exploitation of Servicemembers, or HOMES, Act in 2017. If passed, it would set a 10-year statute of limitations on such foreclosures.
A representative from Schrader's office said it has been introduced twice as a potential amendment to the National Defense Authorization Act, but it has never made it to a vote.
McGreevey, meanwhile, will learn everything he can before his 30-day Supreme Court deadline to decide whether the case is worth pursuing one last time.
Even if he drops it at this point, he said the fight taught him about how life really works.
"Good guys don't always win, bad guys don't always pay, and life isn't always fair," McGreevey said.