FORECLOSING ON COMMUNITIES?MEDIATING COMMON INTERESTS IN HOME FORECLOSURE

Phyllis E. Bernard, M.A., J.D.Professor of Law and Director,

Center on Alternative

Dispute Resolution

Oklahoma City University School of Law

WHY TALK ABOUT COMMUNITY WHEN IT’S A PRIVATE HOME FORECLOSURE?

Economic terms of foreclosure may be affected by non-economic factors

There may be value in identifying and engaging non-party stakeholders to support the negotiation of foreclosure

These stakeholders include, especially, neighbors in the community where the property is located.

FINANCIAL CONFLICT CAN BECOME IDENTITY CONFLICT

On personal, individual, family levelsOn community levelsWe have seen this before in the farm

crisis of the 1980s.Mental and emotional health of

individuals and rural communities impacted by farm foreclosures

Led to development by USDA of farmer-lender mediation program

SIGNS OF COMMUNITY STRESS IN URBAN-SUBURBAN FORECLOSURES

In some areas of the country, neighborhoods have been stressed not only by the physical loss of viable properties,

But by the sense of class (and sometimes ethnic) strain.

THE AMERICAN MYTHOS MEETS AMERICAN MODELS OF JUSTICE AND ADR

A dot? Or a circle? What difference does it make?

WHAT DOES THIS REPRESENT?

THE MYTH OF THE AMERICAN PIONEER, HOMESTEADING IN THE WEST – SOLITARY, STALWART, NEEDING NO ONE

WHAT DOES THIS REPRESENT?

THE EMBEDDED STRATIFICATION OF AMERICAN SOCIETY – WHICH OFTEN DEFEATS SUSTAINED ORGANIZATION FOR CHANGE

CLASS

AGE

GENDER

“RACE” RELIGION REGION

CONSIDER HOW THIS SELF-IMAGE INTERACTS WITH MODELS OF ADR

The heroic “loner” – pioneer defending his farmstead with a shotgun

Relying only upon his immediate family,

Needing and wanting no one else as part of his life

Solitary problem-solving

Mediation model based on Privacy Isolation Exercise of

individual powerPursuit of

individual interests

Bearing individual burdens and benefits

CONSIDER HOW STRATIFICATION AFFECTS MODELS OF JUSTICE – AND ROLE OF ADR

Severe imbalance of power between parties

Class actions or other sustained litigation efforts

Legislative branch (hearings; funding with strings attached; legislation)

Executive branch regulatory interventions

Cannot organize along lines of class, without being cut off by lines of “race,” etc.

Cannot organize along lines of region without being cut off by lines of gender, etc.

Without a public voice, can there be private justice?

THE TRIBAL PEACEMAKING MODEL: OKLAHOMA, NIGER DELTA, USDA?

“The Circle Need Not be Broken” – Theme for the Tribal Peacemaking Program of the Comanche Nation, Oklahoma circa. 1998

CIRCLES OF INFLUENCELOOSE RELATIONSHIPSFORMAL BONDS One lesson learned from my

experiences in tribal peacemaking and community mediation in Oklahoma and Nigeria suggest that there are benefits to opening the mediation, instead.

This alternative model engages a number of persons connected to the parties, the neighborhood, and civic associations to identify common concerns affected by foreclosure.

LIF

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ES

NO

T IN

ISO

LATIO

N Non-

Party

Party

Party

There will almost always be another person or group with an interest in the issue who can help bring about a resolution that works for both - allows them to save face – and will be supported or enforced through group involvement

WHAT GROUP INTEREST IN INDIVIDUAL LOSS? WHY SHOULD NEIGHBORS CARE?

Physical deterioration of abandoned or near-to-foreclosure properties,

Declining housing prices, Rising crime rates, Increases in domestic violence Increases in neighbor-to-neighbor

violence Loss of bonds of community life –

memories, support, emotional protection – otherwise known as “quality of life.”

WE’VE BEEN HERE BEFORE – USDA FARMER-LENDER MEDIATIONS

“Boom and bust” economy Predatory lending practices Brokers/lenders who befriended

farmers/homeowners Sudden loss of value Inability to pay mortgage when due Dissolution of family life, community life “Ghost towns”

MULTIPLE PARTICIPANTS IN USDA MEDIATION

• Financial Counselor

• Mediator

• Farmer• Lender

May or may not be the

actual person who initiated and nurtured

the loan

Family usually not present,

although deeply

affected by outcome

May not be present at table, but assisted in preparationUsually an

outsider not known to the farmer, but lender is a

“repeat player”

WHAT OTHER LIVES ARE TOUCHED?

Farmer-lender probably attend the same church

Their children probably attend the same school

They share many friends in common Men may serve on the Rotary Club, Kiwanis,

Lion’s Club, or fraternal lodge Women may serve together in women’s

auxiliaries, Parent-Teachers Associations, churchwomen’s clubs

Analogs to African age cohorts? Analogs to Native American clans?

The article I wrote for as a Fellow of the National Association of Administrative Law Judges, “The Administrative Law Judge as a Bridge Between Law and Culture” first presented the village peacemaking model I developed with the International Federation of Women Lawyers (FIDA) in the oil-producing regions of the Niger Delta. The paper, published in the Journal of the National Association of Administrative Law Judges (Pepperdine Law School) lays out the initial adaptation using village women as peacemakers working toward the best interests of the individuals and community.

HOMEOWNERS ASSOCIATIONS AND MEDIATED FORECLOSURES

“What touches one, touches all” – Igbo proverb

THE HOMEOWNER’S ASSOCIATION

The modern iteration of the village or clan

Formal or informal? Loose relationships can become better

established Likely follow actions already underway Create a forum for neighbors to assist,

moderate, or at least understand the terms of the foreclosure insofar as they affect the other homeowners

Consider: value of retaining renters?

QUESTIONS? COMMENTS?

Prof. Phyllis Bernardpbernard@okcu.edu or

phyllis_bernard@sbcglobal.net