Sherman Mack (R�Livingston)
BATON ROUGE – A state legislator accused in a civil suit of conspiring to assist his uncle and cousin in enacting a sham loan scheme with a nationwide mortgage lender says the case is a domestic dispute and a "frivolous" lawsuit.
Sherman Mack (R–Livingston) is a first year legislator representing the 95th District, and an attorney working out of Livingston Parish. He was perhaps most well-known in the 2012 legislative session for sponsoring an unsuccessful bill that would have required welfare recipients to submit to random drug screenings.
In documents submitted at the First Circuit Court of Appeal in Baton Rouge, Mary Ellen Strickland, ex-wife of Mack's cousin Stephen Strickland, detailed how Mack allegedly concocted a scheme whereby Stephen Strickland and Mack's uncle Frederick Strickland capitalized on a error within mortgage documentation that Stephen Strickland used to acquire a mortgage from Ameriquest.
Mary Ellen Strickland is represented by Hansel M. Harlan of Baton Rouge-based LeClere Law Firm.
Mack called the lawsuit, which had been dismissed by a district court and is currently on appeal, "frivolous."
Of the underlying case, he said, "I think we are going to win it. As soon as we do I am going to sue him (Harlan) and anyone who prints anything about it."
"He made these allegations and he was not sanctioned, but he was told by the Appellate Court to stop doing it."
Regarding the allegations in the lawsuit, Mack said: "What happened was my cousin's ex-wife, now ex-wife, went from person to person getting loans on this alleged property. And my client had borrowed some money from his parents and had filed a mortgage on it and then the mortgage that she had went and got from Ameriquest came behind that. The real issue is a domestic issue concerning the divorce and community property and that is why she has made these allegations. Subsequently she left town four years ago and nobody can find her."
According to the documents filed at the appellate court, the alleged error in a $60,000 mortgage listed the incorrect property identification, which Ameriquest states that it did not realize until Mack notified the company.
The property for which Ameriquest believed it had provided the loan was Stephen Strickland's home, however, the description in the mortgage was that of another piece of property owned by Frederick Strickland. Upon requesting that Stephen Strickland sign an amended mortgage agreement, Ameriquest claims he ceased payment on the loan.
In sworn testimony, Mary Ellen Strickland claims that before Stephen Strickland defaulted on the loan, Mack advised the family that because the home was not attached to the mortgage Stephen Strickland could use the property as collateral for a private loan while defaulting on the mortgage and transferring the property to satisfy the private loan.
Mary Ellen Strickland alleges that Mack advised Stephen Strickland that he could then declare bankruptcy and avoid repayment of the mortgage without any fear the property would be repossessed by Ameriquest. Mack is alleged to have said that a paper trail would need to be created to satisfy potential inquiry by the courts into the matter.
Calling the private loan a "sham loan," Mary Ellen Strickland claims that to initiate the paper trail Mack himself provided $50,000 to Frederick who then deposited it into his account while Stephen Strickland executed a promissory note denoting his responsibility to repay the loan in the amount of $50,000 to his father Frederick Strickland.
Frederick Strickland then allegedly wrote a check to Stephen Strickland for $50,000 that he deposited into his bank account before immediately returning it to Mack. It is further alleged that Stephen Strickland pretended to default on the "sham loan" provided by his parents and instead donated the home and lot to Frederick Strickland.
Ameriquest insists the loan is suspicious because Stephen Strickland never made a single payment to his father, court documents indicate.
In the case handled by the 21st Judicial District Court, Mack admitted to giving the $50,000 to Frederick Strickland, for which he claims he wrote off and never received repayment. After Ameriquest filed a motion for Mack's bank records in an attempt to identify the $50,000 allegedly repaid to Mack by Stephen Strickland, Mack claimed that any information about money transfers and himself were irrelevant to the case.
The 21st JDC sided with the Stricklands and Mack, but the First Circuit Court of Appeal disagreed.
After returning to the district court, Mack claimed, despite not filing an opposition, that it made no difference whether he provided a $50,000 loan to Frederick Strickland and that any discovery requests concerning a monetary exchange between the two were irrelevant. The court sustained Mack's motion.
Now, the plaintiff has once again brought the case back to the appellate court, asking the court to compel Frederick Strickland to comply with Ameriquest's discovery requests.
The case is being presided over by Division F Judge Elizabeth P. Wolfe in the 21st JDC.
Case no. 114109.