Often people ask what it is that makes me passionate about process serving and it is quite simple; it boils down to fairness and transparency.
When it comes to process serving, the key to achieving the most success is for all parties within a transaction to be protected and informed, while having the ability to pursue legal action if one party does not hold up their end of an agreement.
Due process is an integral piece of each failed transaction.
Although not a difficult concept, due process has a long and intricate definition, but the basic fundamental principal is to ensure notice of legal rights so that no prejudicial or unequal treatment will result during any legal action.
Process serving is the practice of proper notification of the law to ensure the rights of all parties who partake in a transaction. Although many see it as a burden, a small piece of the process or even an unnecessary evil—I could not disagree more.
While it is common in today’s culture to paint the process server as a harbinger of bad news, they are always delivering information that is necessary for all parties to exercise and protect their rights under the law.
Process server clients typically are attorneys or trustees acting on behalf of a lending institution and are using these companies to inform a defendant that they are being sued for some form of delinquency. Upon delivering a notice, the defendant is then able to make the decision to act or simply move on. This notification is not always something people expect, but typically it makes the defendant realize they must face the situation. The notice acts as their call to action.
With that as a backdrop, let’s look at the current debate regarding the pros and cons of proceeding with a foreclosure through judicial or nonjudicial means. Most people know the pros proceeding nonjudicially can yield: decreased cost, timeframes and interactions with judges and courts.
I would argue that this cost is actually quite small in the grand scheme of things when factoring in additional costs and lost interest involved during contested foreclosures in a nonjudicial format or unwinding a foreclosure sale. Further, I would make the case that the judicial process provides a documented record of the actions of all parties into a public record within an impartial judicial system and helps move commentary from a platform of opinion and rhetoric to one of documented fact.
What is often overlooked by advocates of a nonjudicial process is that many times due process is not followed properly or with enough of an advanced notice for all parties to answer this call to action. The recent scrutiny of nonjudicial foreclosure proceedings, largely in West Coast states, has resulted in a plethora of foreclosures being dismissed and lenders literally having to pay the price, not to mention an increase in negative publicity.
Today in Oregon, we are currently seeing a great test case of a state moving from nonjudicial to judicial. As expected, the turn times have increased along with the cost per foreclosure. Some of the delays lie within building new processes and procedures to continue judicially, but one thing is for certain—due process is present—and that provides a level playing field for creditor and debtor when the courts are involved from the start of the process.
As firms become more familiar with the process and continue to (or begin to in some cases) use the expertise of vendors who have an established background in judicial states the timelines will undoubtedly decrease. There are many processes that can be streamlined with the assistance of sound vendors and these improvements will eliminate unnecessary delays and in time eliminate at least one part of the nonjudicial argument.
Service of process firms with a sound, stable and secure background in judicial processes are able to act as consultants during these transition periods and numerous firms have attested to the added value this brings. Whether it is streamlining the location of defendants, having a trained and professional staff in the field to serve, improving or eliminating unnecessary internal processes or taking advantage of data integration, there are many ways that laws firms, trustees and servicers can benefit by consulting with their third-party vendors.
We need to allow for due process to be thoroughly documented, promote accountability to both lenders and borrowers and let the free market correct itself with guidance of the courts. In the meantime, don’t hesitate to utilize the expertise of both clients and vendors during this ever-changing environment within the mortgage industry.
Brian McGrath is head of strategic development for Tampa, Fla.-based ProVest LLC.
