The Associated Press has an article that doesn’t surprise me at all.

American students are falling far behind their international counterparts in learning second languages, creating economic disadvantages for U.S. businesses and raising national security concerns.

Virtually all European and Asian elementary students study a second language, but 97 percent of Ohio and Kentucky students do not because their schools don’t offer it.

Foreign languages are seen as something of a luxury. Our political culture tends to hold other countries in disdain. News reports about the rest of the world are pretty limited. Opportunities for Americans to travel in foreign countries are relatively infrequent. And English, for the time being, is the world’s lingua franca. School systems can’t see a lot of reason to emphasize foreign languages and students can’t see a lot of reason to learn them.

A friend of mine passed along this AP article on the fate of the property acquired by the City of New London that was the subject of the Kelo v. City of New London case handed down by the Supreme Court in 2005.

Turns out the City didn’t need the property that badly after all. The development for which the City exercised the power of eminent domain seems to have collapsed.

Weeds, glass, bricks, pieces of pipe and shingle splinters have replaced the knot of aging homes at the site of the nation’s most notorious eminent domain project.

There are a few signs of life: Feral cats glare at visitors from a miniature jungle of Queen Anne’s lace, thistle and goldenrod. Gulls swoop between the lot’s towering trees and the adjacent sewage treatment plant.
. . .
In New London the city’s prized economic development plan has fallen apart as the economy crumbled.

The Corcoran Jennison Cos., a Boston-based developer, had originally locked in exclusive rights to develop nearly the entire northern half of the Fort Trumbull peninsula.

But those rights expired in June 2008, despite multiple extensions, because the firm was unable to secure financing, according to President Marty Jones.

In July, backers halted fundraising for the project’s crown jewel, a proposed $60 million, 60,000-square-foot Coast Guard museum.

The legal decision didn’t bother me. The project, as described in the Supreme Court case — as opposed to the media reports about the Supreme Court case, did not strike me as such a departure from tradition. It was a big project with a lot of public use and, yes, some private use, but it was not a simple matter of seizing land from one person and handing it to another.

But, jeeze, make sure you can get the job done once the land is acquired. This is a horrible waste. Sometimes I’ll tell a client or potential client, “Are you really sure you want to do this? Because this sounds like the kind of case where nobody is going to win but me.” Looks like this ended up being one of those cases.

What if the mortgage industry screwed up its legal right to foreclose on (give or take) 60 million homes? That’s the potential consequence of Landmark National Bank v. Kesler (Kan. 2009). The Kansas Supreme Court can’t issue binding precedent for the rest of the country, but the reasoning here is not to be easily ignored.

I don’t fully understand the ins and outs of this process, so look elsewhere for an authoritative discussion, but generally the issue is that a number of lenders set up an entity called “Mortgage Electronic Registration Systems, Inc.” (MERS – the Wikipedia article seems informative but not neutral.) As I understand it, this entity purports to be the mortgagee of record to a note on a loan secured by real estate. Lenders who are participants in the MERS program can buy and sell interests in mortgages and, I suppose, portions thereof without having to do a lot of paperwork and recording that assigns the mortgage to one person and then another as the financial obligation is traded about. So, Bank A lends the money to a Buyer to purchase a home and has the Buyer sign a mortgage in favor of MERS. As a participant in the MERS program, Bank A can then sell the mortgage to Bank B without having to do a lot of paperwork assigning the mortgage to Bank B and recording that assignment in the county recorders office.

The facts described by the Kansas Supreme Court are probably typical of a MERS mortgage:

The second mortgage lies at the core of this appeal. That mortgage document stated that the mortgage was made between Kesler–the “Mortgagor” and “Borrower”–and MERS, which was acting “solely as nominee for Lender, as hereinafter defined, and Lender’s successors and assigns.” The document then identified Millennia as the “Lender.” At some subsequent time, the mortgage may have been assigned to Sovereign and Sovereign may have taken physical possession of the note, but that assignment was not registered in Ford County.

The problem with MERS is that the mortgage (granting the power to foreclose in the even of default) is severed from the note (creating the obligation by which default is possible). The Kansas Supreme Court describes what can happen when the the mortgage is severed from the note:

The relationship that MERS has to Sovereign is more akin to that of a straw man than to a party possessing all the rights given a buyer. A mortgagee and a lender have intertwined rights that defy a clear separation of interests, especially when such a purported separation relies on ambiguous contractual language. The law generally understands that a mortgagee is not distinct from a lender: a mortgagee is “[o]ne to whom property is mortgaged: the mortgage creditor, or lender.” Black’s Law Dictionary 1034 (8th ed. 2004). By statute, assignment of the mortgage carries with it the assignment of the debt. K.S.A. 58-2323. Although MERS asserts that, under some situations, the mortgage document purports to give it the same rights as the lender, the document consistently refers only to rights of the lender, including rights to receive notice of litigation, to collect payments, and to enforce the debt obligation. The document consistently limits MERS to acting “solely” as the nominee of the lender.

Indeed, in the event that a mortgage loan somehow separates interests of the note and the deed of trust, with the deed of trust lying with some independent entity, the mortgage may become unenforceable.

“The practical effect of splitting the deed of trust from the promissory note is to make it impossible for the holder of the note to foreclose, unless the holder of the deed of trust is the agent of the holder of the note. [Citation omitted.] Without the agency relationship, the person holding only the note lacks the power to foreclose in the event of default. The person holding only the deed of trust will never experience default because only the holder of the note is entitled to payment of the underlying obligation. [Citation omitted.] The mortgage loan becomes ineffectual when the note holder did not also hold the deed of trust.” Bellistri v. Ocwen Loan Servicing, LLC, 284 S.W.3d 619, 623 (Mo. App. 2009).

Or, in short, “If MERS is only the mortgagee, without ownership of the mortgage instrument, it does not have an enforceable right.” But, if MERS does have enforceable rights to the underlying note, it could find itself embroiled in regulations that apply to mortgage bankers.

Matt Taibbi has a blog entry on this likening the mortgage industry to a giant criminal enterprise. He also notes that, more generally, the mortgage industry has been incredibly sloppy with its record keeping. This has allowed debtors to successfully challenge a lender’s right to foreclose in some cases. These are people who have received a benefit from money lent and who have failed on their promises to repay the money, but the lender (or whoever is currently holding the bag) can’t recover because they can’t prove they actually own the debt.

I don’t know if severing the note from the mortgage has a similar effect in Indiana or if MERS mortgages use the same language in Indiana. I suspect we’ll see an increase in challenges along these lines as attorneys become more attuned to the issues and courts analyze evidence about chain of title with a more critical eye. Glancing at some of the cases, I saw a case where the Northern District of Illinois shrugged off a similar challenge based on some affidavits from people associated with MERS and no serious rebuttal or opposition from the mortgage-debtor.

If MERS mortgages were deemed to be unenforceable, it could obviously have major repercussions. I ran a quick and dirty search on the Tippecanoe County court system and found more than 500 cases where “Mortgage Electronic Registration Systems, Inc.” was a party.

Update: Per a comment, here is the link to an entry Advance Indiana did on the subject a month or two ago.

St. Joseph County is having a trial over a judicial mandate to increase salaries for judicial staff and improvements at a juvenile detention center. The Indiana Law Blog, as per usual, has some good coverage of this issue.

[Judge] Nemeth and county officials are in a legal fight over $313,000 in funding the county refused to release in 2008 to renovate parts of the JJC. The County Council and county commissioners had approved the judge’s request to transfer the money from an unspent personnel fund, but county commissioner Bob Kovach later refused to sign a requisition order.

Nemeth issued a judicial mandate order to obtain the money.

He also issued a mandate seeking to use probation services fees to fund raises for the juvenile/probate court’s executive secretary, fiscal officer, JJC director and five other managers. The proposed raises range from 10 percent increases to nearly 34 percent.

I’ve held forth on other mandate cases over the years. (See, e.g., here and here and here.) The problem, as I see it, is that judges are a little bit county and a little bit state. They can use their state created judicial powers in service of their county administrative functions. Other county department heads can’t just order the county council to dig into the county general fund and cough up more money for county employees. State judges can.

The Indiana Judicial Conference recently laid out a strategic plan (pdf) that touches on the mandate issue as well as a number of other things. Consideration is being given to centralizing administration and funding of the courts. Currently judges, magistrates, and prosecutors are paid by the state while the rest of the court staff and other administrative expenses are paid by the county.

Where we want to be:

We can do better by distributing resources across the State in a more equitable manner by pursuing centralized funding. More Hoosier citizens will benefit, particularly in counties without a large tax base.

The Division of State Court Administration is pursuing three studies regarding costs associated with centralized funding. The studies are by Larry DeBoer of Purdue University, the Indiana University SPEA school, and a local consultant. These studies are in progress, and we do not know what the results ultimately will be until these studies are complete. At this point, we cannot say centralized funding will definitely create taxpayer savings. We can say, with certainty, efficiencies will result by combining resources and eliminating duplicated efforts.

We have yet to address many complex issues, including arrangements for state court personnel to use county facilities, whether to convert court employees to state employees, and if so, which court employees should be converted. We would have to address court, probation, and security staff, public defenders and pauper counsel, as well as guardian ad litems and court appointed special advocates, interpreters and other specialized court functions. Some judicial officers who now work as commissioners and referees would become state funded Magistrate Judges under a centralized funding scenario.

We will also have to address a method for governance, budgeting, and allocating assets. It would be premature to render an opinion on how this funding change would work until such time as the three studies have been completed. Even without the results from the studies, we believe centralized funding will eliminate duplication and increase efficiency, as well as distribute resources in a uniform manner among all counties.

Generally speaking, I would suggest that the power to spend should be coupled with the duty to fund. If a state official is going to order that something be paid, then the state should be responsible for raising the funds. In the South Bend context, it’s one thing for the judge to say that staff salaries ought to be raised or that the juvenile justice center ought to be maintained better. I’m sure he’s right. But other things in the county need funding as well and, to me, it doesn’t seem quite right that the judge’s concerns get to jump to the front of the line simply by virtue of the judicial mandate.

Charles Lemos at MyDD has a post up about Senator Al Franken’s (D-MN) questioning of the Justice Department’s David Kris about the Patriot Act.

Lemos describes the parts of the Patriot Act up for renewal as:

The three powers up for renewal are, first, the Section 215 powers that allow the government to obtain literally any tangible thing held by a third party about you with a secret court order, and that court order does not have to be based on any wrongdoing on your part or any suspicion that you’ve done anything wrong. The other provision, number two, is Section 206 of the Patriot Act, which relates to John Doe roving wiretaps, which allows the FISA court to issue a secret order to follow people’s cell phones, from cell phone to cell phone, if they’re suspected of being involved in terrorism. And the third provision is known as the “lone wolf” provision, which allows a full array of searches to be issued by the court secretly, if someone is believed to be a potential threat.

Franken, playing the “aww shucks, I’m not a lawyer, but . . .” card, wondered how these powers squared with the relatively clear language of the Fourth Amendment:

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

Franken emphasized the particularity requirement in the Fourth Amendment. Kris was apparently taken aback by the question and was heard to mutter “this is surreal” and then said something about deferring to the courts.

I can’t play the “aww shucks, I’m not a lawyer” card. I know that real life situations have a way of muddying even the clearest language. But, I’m certainly glad for Franken and any other legislators who are committed to reading the Constitution and knowing what it says. There’s a difference between retreating from an absolute stance on Constitutional language because of competing requirements and doubts about intent on the one hand and simply not knowing or caring about the Constitutional language on the other hand.

I just had to give a shout out to the land of my childhood, Wayne County, for its outstanding work in attracting (or creating) divorced people.

More than 19 percent of Wayne County residents over age 15 are divorced, according to new 2008 estimates from the U.S. Census Bureau. That’s the highest percentage for any county with a population more than 65,000 in the nation, and two other Indiana counties — Floyd and Madison — also made the top 10.

My folks got divorced back in the early 70s, presumably before it was cool. I had no idea they were trendsetters.

Serious nuanced debate frequently seems to bog down. But, there are other options. Somehow humor seems to work better on the Left. (The Right has its own effective tools):

I am in Day 2 of my continuing legal education seminar. I have my iPhone but no laptop, so blogging is tough. Twitter and Facebook seem to be getting a lot of my attention – even with the gripping federal tax update going on now. Word of warning on that, though. The federal estate tax lapses for a year next year. So, watch your back if you have any greedy heirs.

I mentioned earlier my belief that limiting medical malpractice liability won’t do much to drive down the cost of health care. So, what will? My favorite health care futurist — ok, the *only* health care futurist I know — Joe Flower, has a list. Click through the link for the narrative, but the list is as follows:

1. Single payer.
2. “Robust” public option.
3. Limiting medical loss ratios.
4. Negotiating drug prices.
5. Bundling.
6. Publishing outcomes.
7. Publishing prices.
8. Banning discounts.
9. Giving a premium to integrated “accountable care organizations.”
10. Increasing subsidies for digitization, tied to productivity improvements.
11. Subsidizing automation.
12. Standardization and checklists.
13. Warranties.

The issue of “medical loss” is one that really captures my attention. It has to do with what percentage of health insurance premium dollars actually go toward providing health care. A high percentage suggests an efficient health care system and a low percentage suggests an inefficient system. Flower has this to say about medical loss in the U.S. versus Europe:

Many European countries dictate that health plans must return 85% or 90% or 92.5% of the premium paid in as medical services paid out. U.S. health plans, in contrast, compete on (and brag to Wall Street analysts about) how low their medical loss ratio is. Some are as low as 60%.

Maureen Groppe, writing for Gannett, has an article about increased attention to “tort reform” in the context of the health care debate.

Medical malpractice costs are getting increasing attention in the health care debate, despite studies that show capping jury awards in malpractice cases would do little to lower health care spending.

I mentioned last week Jeff Hagedorn’s opinion piece in the Perry County News citing studies that suggest the rise and fall of medical malpractice premiums correlate much more strongly with shifts in the stock market than they do with malpractice costs.

But, never mind the reality. That medical malpractice claims have something significant to do with health care costs has become an article of faith among voters and, consequently, among politicians seeking their votes.

The Groppe article points out that Indiana has a pretty doctor-friendly malpractice system and yet there is little evidence that this has done much to keep health care costs down in our state.

Indiana’s health spending per capita is slightly higher than the national average. Hoosiers spend less per person on doctors, but more for hospitals and health insurance premiums, according to the Kaiser Family Foundation, a health policy research group.

WellPoint Inc., the Indianapolis-based insurance giant, said in a May report that malpractice suits are one of the popular explanations for rising health care costs, but falsely so.

I don’t really have a dog in the medical malpractice fight. I don’t practice that kind of law and, if I did, chances are I’d be defending and would find further restrictions advantageous for a client. But, in terms of the health care debate, it’s little more than a distraction.