UTA has raised $20,000 from twelve member companies for a planned legal challenge to at least one of the local ordinances that address the problem of abandoned and non-code complying properties by imposing the responsibility of inspecting, registering, maintaining and securing properties upon trustees and beneficiaries under deeds of trust on the property.

UTA’s established fund – the ‘UTA Ordinance Fund’ – hopes to raise $50,000 to challenge these local ordinances in court if the various cities and counties refuse to make reasonable amendments to their ordinances.  While UTA plans to provide position papers and to work with local governments to assist them in amending their ordinances, it is unlikely that all local governments will respond favorably without a legal challenge. 

Click here for a summary of the Riverside County (CA) ordinance, effective May 13, 2008.

UTA’s legal challenge of at least one of the local ordinances as being unenforceable for various reasons, will be based on many arguments, including an argument that the ordinance is unconstitutional.   This will be a costly endeavor and will require substantial donations even though UTA’s attorneys will reduce their normal fees to support the effort.  This is not an amicus effort but an actual court trial challenge to the ordinance.  Appeal of the result is likely regardless of which way the trial court rules.

As UTA’s budget does not include funds for this critical and important effort, UTA cannot proceed without substantial contributions from its members and its supporters.  UTA urges all members and supporters to immediately contribute to the “UTA Ordinance Fund”.  If you do not help UTA now, how much will you have to expend on attorney’s fees, costs and fines when your company is cited under these local ordinances?

In determining whether to make a contribution and how much of a contribution would be appropriate, we suggest that trustees and beneficiaries should consider:  “What will it cost me to inspect, register, maintain and secure just one property during a foreclosure? How much in unreimbursed expenses could I incur in processing hundreds of foreclosures?  How much in fines can I afford?”

A trustee fighting this on its own (when confronted by unfair and excessive penalties) could easily spend $50,000 to $100,000 defending the case.  The best approach is as a group.

Simply mail your check to:

Attention "UTA Ordinance Fund"
United Trustees Association
2030 Main Street
Suite 1300
Irvine, CA 92614

UTA believes that once it successfully challenges one of these ordinances, others will be easier to challenge. Ultimately, cities will be more cautious in writing such ordinances that attempt to expand the role of the trustee. 

Click here to read several municipal ordinances.

If trustees and lenders do not challenge this type of redistribution of liability and responsibility now, where will it end?  Please consider assisting in this very important work.  Thank you!