A Reservist in a New War, Against Foreclosure

Believing he was protected by the civil relief act — as, indeed, he was, as of Sept. 11, 2004 — his family repeatedly informed Saxon that Sergeant Hurley had been sent to Iraq. But Saxon refused to grant relief without copies of his individual military orders, which he did not yet have.

Although Saxon’s demand would have been legitimate if Sergeant Hurley had been seeking a lower interest rate, the law did not require him to provide those orders to invoke his foreclosure protections.

Nevertheless, Saxon referred the case to its law firm, Orlans Associates in Troy, Mich., which completed the foreclosure without the court hearing required by law. The law firm filed an affidavit with the local sheriff saying there was no evidence Sergeant Hurley was on military duty. At a sheriff’s sale in October 2004, the bank bought the property for $70,000, less than the $100,000 the sergeant owed on the mortgage.

Orlans acknowledged in a court filing that one of its lawyers learned in April 2005 that Sergeant Hurley had been on active duty since the previous October. Nevertheless, neither Saxon nor the law firm backtracked to ensure the foreclosure had been legal or took steps to prevent the seized property from being sold, according to the court record. Lawyers for Orlans Associates did not respond to a request for comment.

When Sergeant Hurley sued in May 2007, the defendants initially argued that he was not allowed to file a private lawsuit to enforce his rights under the civil relief act. Federal District Judge Gordon J. Quist agreed and threw the case out in the fall of 2008.

That drew a fierce reaction from Col. John S. Odom, Jr., a retired Air Force lawyer in Shreveport, La., who is working with Sergeant Hurley’s local lawyer, Matthew R. Cooper, of Paw Paw, Mich.

Colonel Odom, recognized by Congress and the courts as an expert on the Servicemembers Civil Relief Act, knew Judge Quist had missed a decision that overturned the one he had cited in his ruling. In December 2008, Colonel Odom appealed the ruling.

In March 2009, Judge Quist reversed himself, reinstated the Hurley case, ruled that the foreclosure had violated the civil relief act and found that punitive damages would be permitted, if warranted.

Despite that legal setback, the defendants soldiered on. As the court docket grew, they argued against allowing Sergeant Hurley to seek compensatory or punitive damages in the case. Judge Quist ruled last month that punitive damages were not warranted — a ruling Colonel Odom has said he has challenged in court and, if necessary, will appeal.

“Nothing says you screwed up as clearly as a big punitive damages award,” he said. “They are a deterrence that warns others not to do the same thing.”

When the trial on damages begins in early March, Sergeant Hurley will have been fighting for almost four years over the illegal foreclosure, a fight he could not have waged without a legal team that will probably only be paid if the court orders the defendants to cover the legal bills.

Regardless of the trial outcome, Sergeant Hurley’s dream home is likely to remain as far beyond his reach as it was when he was in Iraq. Its new owner has refused to entertain any offers for it and recently bought an adjoining lot.

Sergeant Hurley said he still loved the wooded refuge he drives past almost every day. “I was hoping I could get the property back,” he said. “But they tell me there’s just no way.”