Excellent news for Arizonans battling foreclosure! We have continuously argued against removal based solely on diversity because the state law issues in these foreclosure cases are predominant, and it is important for the state to have a cohesive scheme regarding its real property laws, and novel issues of state law interplay. And we’ve seen what kind of distastrous rulings ensue when our federal courts start making creative Erie estimations of how the AZ State Supreme Court would rule on many critical issues of state property law. Bad law makes an impact for years to come. So of course the banks love to drag homeowners into federal court.
There have been other remands by federal court judges, however, in the case I’m about to discuss, Judge Aspey actually analyzed the issue under several abstention doctrines.
Magistrate Judge Aspey issued a well reasoned remand order in favor of homeowner/attorney, Barbara Forde. In so doing, he reasoned that the federal court should abstain from hearing the case under the Burford absention doctrine, Younger abstention, and Rooker-Feldman. He also stated that the issue could be raised sua sponte. Full opinion here: Aspey AZ Order-to-Remand-Case-to-State-Court The attorney’s comments here.
Here’s a passage from the order:
The Court concludes judicial economy, fairness, comity,the existence of novel issues under Arizona law, and thenecessity for the Court to interpret Arizona state statutes weigh heavily in favor of the Court declining jurisdiction over this matter. Remand at this time will reduce litigation costs and eliminate any need to certify novel state-law issues to the Arizona Supreme Court or speculate how the Arizona Supreme Court would rule on those issues.