Legal Question in Real Estate Law in California

Your father did a reverse mortgage with your father? Who is suing you? The original purchase money lender or the reverse mortgage lender? Please proof-read and clarify your question and re-post it.

I think I understand what's happened, although your post could have contained a few more details. Although you didn't sign the loan documents, so you aren't obligated on the loan itself (whaterver that would mean in the context of a reverse mortgage!), the lender has been issuing proceeds checks (either lump sum or monthly or both) showing your father and you as joint payees. Therefore, by the lender's logic, it has been making gifts to you, which it didn't intend. You are a reipient of the checks, but have no obligation in connection therewith, and your equity in the house is unaffected (not reduced) by the payouts.

That's the lender's position, I'd guess, and that's certainly a sufficient set of facts upon which to sue you for unjust enrichment.

Once you have been served with a summons and complaint, whether the suit is winnable or not, your thoughts must turn to defending. Ordinarily, and I'd think here, what you must do is retain a lawyer and have him or her prepare, file and serve an answer. This must be done within 30 days of service of process in order to prevent having your default taken and judgment entered against you. Relief from default and default judgments can often be obtained, but it is far better to make a timely defense.

In your case, I believe negotiation with the lender may result in an early out-of-court settlement. The lender probably wants you to become a co-signer on the reverse mortgage, which would result in your share of the equity being depleted as well as your father's. What was the original intent here, by the way? If your father is getting all the money and yet you are expected to share in the equity suckout, he needs to square up with you, unless, of course, you intend to make him a gift.

Nevertheless, the lender has (apparently) a halfway decent case IF it has been issuing two-payee checks, because you will be deemed to have received your share of the payments. Of course, your father has probably gotten all of the money, but the lender doesn't know that.

The proper outcome of this lawsuit is to get the paperwork re-done, as it should have been in the first place, and for your and your father to figure out whether he gets all the benefit of the reverse mortgage but only suffers half the loss (but that's between you and him).

If the suit can't be settled and has to be defended, you'd take a more aggressive stance, perhaps claiming that the bank's loss is due to its own fault, that you never received a penny, etc., but I'm afraid justice really requires that both half interests (which are now probably tenancies in common, the joint tenancy having probably been severed by the divorce or something else by now) be affected equally by the draw-outs of equity.

A better analysis would require review of the home-equity loan contract, the lawsuit, and the method of payment of the loan proceeds. I'd be happy to make such a further analysis for you at no cost or obligation, but I would need to see the aforementioned documents by scan and e-mail or FAX to (707) 878-2237.

Mr. Whipple is very knowledgeable as to real estate matters so I would suggest you take him up on his offer. The strength of your defense will rest on what you knew about the terms of the mortgage, whether you received any of the payments, were the check made out to him alone or bot of you but with either having the ability to withdraw the funds, did you benefit in any fashion from the payments [if as a practical matter your father is essentially on a monthly basis selling a portion of his equity to the bank, I do not see what you are getting from the deal unless he is paying more than his share of the pre-existing mortgage so that your monthly payments are left; if there is no enrichment to you then there is no unjust enrichment to you and you should contact the bank and tell them the situation and ask that you be dropped from the suit and if they do not sent them proof of your not getting anything and a declaration to that effect and tell them if they do not drop you you will sue them for abuse of process in filing an invalid suit since they have no evidence that you were unjustly enriched --that probably will not work but is worth a try].

not proof read

Your post is a hard read. The following is not clear from your post.

1) Was a quit claim deed ever delivered by your husband in the divorce? If so, how did it place title?

2) Is your father still living?

3) Have you received payments and deposited them in your account under the reverse mortgage?