Going Public: The State-Action Requirement of Due Process in Foreclosure Litigation

Clearinghouse Review, Vol. 43, 2010

12 Pages Posted: 31 Jan 2015

See all articles by John Pollock

John Pollock

National Coalition for a Civil Right to Counsel; Public Justice Center

Date Written: January 1, 2010


The companion article to this one, Lassiter Notwithstanding: The Right to Counsel in Foreclosure Actions, argues that appointment of counsel is required in foreclosure-related judicial proceedings under the due process clause of the Fourteenth Amendment. A threshold requirement to Fourteenth Amendment due process claims, however, is that the action complained of constitutes “state action.” Here I discuss whether foreclosure-related judicial proceedings can meet that threshold requirement. I also discuss whether state constitutions provide more fertile ground for claims that foreclosure-related judicial proceedings violate due process.

The term “foreclosure-related judicial proceedings” is intended to cover foreclosures in judicial-foreclosure states and the court proceedings related to foreclosure in nonjudicial foreclosure states. In judicial-foreclosure states, mortgage lenders or servicers (hereinafter collectively referred to as “lenders”) must file a court action in order to foreclose on a mortgage. In nonjudicial-foreclosure states, lenders may foreclose through the mortgage or lending contract by exercising a power-of-sale clause. Judicial proceedings in nonjudicial-foreclosure states are initiated only when a debtor seeks an injunction against foreclosure, brings an affirmative case challenging the underlying loan or failure to comply with foreclosure statutes, or files for bankruptcy, the last triggering an automatic stay of the foreclosure.

I conclude here that strong state-action arguments support Fourteenth Amendment due process claims in judicial-foreclosure states, but the same is not necessarily true in nonjudicial-foreclosure states under ordinary circumstances. In both types of states, however, such claims may succeed under state constitutional law because state constitutions may have more liberal “state-action” requirements or alternatively might not require state action at all. Note that certain recent developments that I do not take up here may greatly strengthen the argument for state action. For instance, I do not discuss whether receiving fed- eral bailout money might transform lenders into state actors. Nor do I exam- ine whether federal entities such as the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Corporation (Freddie Mac), and the U.S. Department of Veterans Affairs might be considered state actors under the due process clause of the Fifth Amendment by virtue of their governmental status.

Keywords: civil right to counsel, civil gideon

Suggested Citation

Pollock, John, Going Public: The State-Action Requirement of Due Process in Foreclosure Litigation (January 1, 2010). Clearinghouse Review, Vol. 43, 2010, Available at SSRN: https://ssrn.com/abstract=2557576

John Pollock (Contact Author)

National Coalition for a Civil Right to Counsel ( email )

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Suite 200
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United States
(410) 625-9409 (Phone)

HOME PAGE: http://www.civilrighttocounsel.org

Public Justice Center ( email )

One N. Charles St.
Suite 200
Baltimore, MD 21201
United States
((410) 625-9409 (Phone)

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