# Petition for Writ of Certiorari — Porter v. BankNorth, N. A. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386001_1023%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 2004 - **Citation:** 541 U.S. 938 ## Text , Supreme Court, U.S. {;\ FILED ot 031090 JAN 27 2004 No. 03- OFFICE OF THe CLitix IN THE Supreme Court of the United States DAVID S. PORTER and CAROLA. PORTER, Petitioners, v. BANKNORTH, N.A., F.S.B. DEVELOPMENT CORP., Respondents. On PETITION FOR A WRIT OF CERTIORARI TO THE MASSACHUSETTS APPEALS COURT PETITION FOR A WRIT OF CERTIORARI Davip S. Porter, Pro Se CaroLA. Porter. Pro Se 995 Washington Street Dedham, MA 02026 (781) 251-9992 185411 ce COUNSEL PRESS (800) 274-3321 + ($00) 359-6859 QUESTIONS PRESENTED The Due Process Clause of the Fourteenth Amendment to the United States Constitution prohibits a state, acting through its judiciary, from “depriv[ing] a person of all existing remedies for the enforcement of a right, which the State has no power to destroy, unless [he] is. . . afforded... some real opportunity to protect it.” Brinkerhoff-Farris Co. v. Hill, 281 US 673, 680 (1930). This case involves a series of judicial actions and inactions, many made without explanation and all in plain conflict with controlling precedent and applicable rules of practice and procedure, which together deprived Petitioners of any real opportunity to enforce their rights under federal credit and banking and state consumer protection law. 1. Whether the state court’s procedural rulings in this litigation were so contrary to controlling precedent that they deprived petitioners of their rights under the federal Equal Credit Opportunity Act and Bank Holding Company Act? 2. Whether the state court’s repeated deprivation of the Porters’ rights to present their case and be heard in support of their claims was so fundamentally unfair, that it amounted to a denial of due process, and resulted in a manifestly unjust and unconscionable judgment? il TABLE OF CONTENTS Page Chepetanoris PROMCIIRG ow oi kc ce hese ns caeees 1 aT CE |. 6k ea Ge eee a ll Table of Cited Aisthnoritses . ... 5. co eee ccc cuses 1V TURRS OT ADORTES ....... ic cess de sswiwenne Vill Se rrr ere kc” 1 Statement Of JurisGichon ..... kes ck ve ee inns l UNUNOE PUVGTVNG © ook ck cio vn xws} deo ea ee eee l Statement OF He Case . ww. kk ei dive vaseuenas's ] A. Proceedings In The Superior Court of Peers ’ B. Proceedings In The Appeals Court Of rr re ree 10 C. Proceedings In The Supreme Judicial Court of eee ee eye eee 11 Reasons for Granting the Petition .............. 11 A. The Porters Were Deprived Of Their Rights | Under The Federal Equal Credit Opportunity Act And Bank Holding Company Act By The State Court’s Novel Application Of Its Procedural RMGG6. os 605 is besa eee 1] B. The ill Contents This Court has the power to determine whether a state court has improperly by- passed a federal right under a form of re The refusal by the Massachusetts court to hear the Porters’ federal claims was outcome determinative. ............. The Porters’ federal rights were thwarted by the Massachusetts court’s application of local procedural rules with pointless a State Court’s Repeated Deprivation Of The Porters’ Rights To Present Their Case And Be Heard In Support Of Their Claims Was So Fundamentally Unfair That It Amounted To A Denial Of Due Process And Resulted In A Manifestly Unjust And Unconscionable EO ae a Conclusion as en SS ee ee See eee eS eB eee eakraevw es oe ee © Pa ge 1] 12 13 19 25 iv TABLE OF CITED AUTHORITIES Page - Cases: Anderson vy. United Finance, 666 F.2d 1274 (9" Cir. SE Sx ob 05a eas s Cee eae eae ee eae 12 Boddie v. Connecticut, 401 U.S. 371 (1971) ...... 25, 26 Brinkerhoff-Faris Co. v. Hill, 281 U.S. 673 (1930) EET TCL TT See OTT TT ee rer ee 1, 19, 20, 24 Castelluci v. United States Fidel. & Guar. Co., Fie WU POU TTD 5 605 Fi 5 as Co eee u evens 14,15 Chicago B. Q. Ry. v. Drainage Comm'rs, 200 U.S. gk | errr re ee rer rr a eee ire 12, 13 City of Medford v. Corbett, 302 Mass. 573 (1939) ... 18 Commonwealth vy. White, 429 Mass. 258 (1999) ... 18 Dalis v. Buyer Advertising, Inc., 418 Mass. 220 Se ae ee ee Preis Pe ae kara mca ere “be 24 Dinwiddie v. Brown, 230 F.2d 465 (5" Cir.), cert. demind, 554 U3. 971 (T9SG) occ vs cens 21 Ellis v. Dixon, 349 U.S. 438 (1955). .........046. 1] Foman vy. Davis, 371 U.S. 178 (1962) ........... 14, 15 Goulet v. Whittin Mach. Works, Inc., 399 Mass. 547 C2; eae se ig eae Sena 14, 15, 16, 17 Guardianship of Hurley, 394 Mass. 554 (1985) .... 14-16 Cited Authorities Hamed v. Fadili, 408 Mass. 100 (1990) .......... Hayes v. New England Millwork Dist., Inc., 602 F.2d aie So ee enpinnes Mabini e he Rip anet Howlett v. Rose, 496 U.S. 356 (1990) ........... Lawrence Savings Bank v. Garabedian, 49 Mass. App. Ch. S0e Ce 2K 8060 es ree eee ee Malave v. Carney Hosp., 170 F.3d 217 (1* Cir. 999) Sens Sg re ee ee er See eee oes Markell v. Sidney B. Pfeifer Foundation, Inc., 9 Mass. Pa: Ge eh be ee oer eae Mathis v. Massachusetts Electric Co., 409 Mass. 256 bg) SUC See ee eer eT Teer er ek Montanez v. Bagg, 24 Mass. App. Ct. 954 (1987) ... N.A.A.C.P. v. Alabama ex. rel. Flowers, 377 U.S. 288 COE o0.c4 ch akReae eens eee aeees 14,17, Precious v. O’Rourke, 270 Mass. 305 (1930) ..... Quimby v. Zoning Bd of App. of Arlington, 19 Mass. Mae. Ch. CR Ee: be 05 bh Sees Salem Realty Co. v. Matera, 10 Mass. App. Ct. 571 i i ne rae er eee rene wae ene Schrottman v. Barnicle, 386 Mass. R. 627 (1982) ... 12 18 18 25 14 24 18, 19 18 19 24, 25 Vi Cited Authorities Page Shammas v. New England Merchants Nat’l Bank, 1990 WL 354452 (D. Mass. 1990) ............ 12 Slaney v. Westwood Auto, Inc., 366 Mass. 688 es Ghee Cay Gea or ele ae Sagat eee 24 Street v. New York, 394 U.S. 576 (1969) ......... 11-12 United States v. Consumer Fin. Corp., 816 F.2d 487 ST EE ica soe eee eee 12 Vendella R. Co. v. State of Indiana ex. rel. City of South Bee, 20) OB. FOP TFG) nw ok vs ec avavsacs%s 17 Walsh v. O'Neil, 350 Mass. 586 (1966) .......... 19 Young v. Ragen, 337 U.S. 235 (1949) ........... 15,17 United States Constitution: Fourteenth Amendment ..................0.02- 1, 19, 22 Statutes: 12 U.S.C. §§ 1972(1)(C), (D) et seq. (“BHCA”) .. passim 15 U.S.C. $§ 1691, et seg. (ECOQA”) ........... passim Li oe Ey en 1 Massachusetts Consumer Protection Act, i SO” A Ge a eer re passim Cited Authorities Page Rules: rr ae, Be OED nc ec we kv uo eens en saeeuwaa 14 Pe Te CA PUD Sick bs ae ots cesses ... 10,24, 25 ee eee OE eo kc ek ek ene eae eee eee 20 Se | rn en wri a ares na ara 20 Other huthedMies: pe eg RSS} nner mare eeerer as ger + 23 ik Re ser errr rere eer 1, 23 vei S HE eo ie fee rere ae 1,8 bie t Be ow”. |) rem ee saree 12 Vili TABLE OF APPENDICES Appendix A — Memorandum And Order Pursuant To Rule 1:28 Of The Commonwealth Of Massachusetts Appeals Court Entered September OR or ce Wea ces eas ene Derek Appendix B — Corrected Final Judgment Of The Commonwealth Of Massachusetts Dated April 28, SR Kies nag cde ee RA Re eas Appendix C — Memorandum Of Decision And Order On Plaintiff’s Motion For Partial Summary Judgment And On Defendant’s Motion For Partial Summary Judgment On Their Counterclaim Of The Commonwealth Of Massachusetts Superior Court RP FOES Bg ROE 6 oo 64a haa e hbo hs aos Appendix D — Order Of The Supreme Judicial Court For The Commonwealth Of Massachusetts Denying F.A.R. Application Dated October 29, 2003 .... Appendix E — Statutes And Regulations Involved .. Page la 6a 9a I5a l6a l OPINIONS BELOW The opinion of the Appeals Court of Massachusetts (Pet. App. la) is also unreported. The opinion of the Massachusetts Superior Court for the County of Middlesex denying petitioners’ cross-motion for summary judgment on claims under Federal credit statutes (Pet. App. 9a) is unreported. The trial court issued a Corrected Judgment. (Pet. App. 6a). STATEMENT OF JURISDICTION The judgment of the Massachusetts Appeals Court was entered on September 10, 2003. On October 29, 2003, the Supreme Judicial Court of Massachusetts denied Petitioners’ Application For Further Appellate Review. (Pet. App. 15a). This Court’s jurisdiction is invoked under 28 U.S.C. § 1257(a). STATUTES INVOLVED This case involves the Equal Credit Opportunity Act (“ECOA”), 15 U.S.C. §§ 1691, et seq., enabling regulation (“Regulation B”), 12 C.F.R. §§ 202.1, et seg. (Pet. App. 17a- 21a), the Anti-Tying Provisions of the Bank Holding Company Act (“BHCA”), 12 U.S.C. §§ 1972(1)(C), (D) et seq. (Pet. App. 16a), and 940 CMR § 3.16 (4). STATEMENT OF THE CASE This case involves a series of judicial actions and inactions, many made without explanation and all in plain conflict with controlling precedent and applicable rules of practice and procedure, which together deprived Petitioners David S. Porter ee en Z (“Mr. Porter’), Carol A. Porter (“Mrs. Porter’) (collectively ‘the Porters’’) of any real opportunity to establish violations by the Respondents Bank North, N.A. (“Bank’’)' and its wholly- owned subsidiary, F.S.B. Development Corp. (“FSBDC”’) (collectively “the Bank’’) under federal credit and banking law, which constitute per se violations of the Massachusetts Consumer Protection Act, M.G.L. c.93A, §§ 9, 11. Mr. Porter and the Bank were partners in PLLP, a real estate development partnership formed to acquire and develop property in Needham, Massachusetts (the “Project”’). The parties agreed that Mr. Porter would manage the Project, and that funding for the Project would be provided by the Bank and FSBDC. The Bank selected Mr. Porter as its first joint venture partner based upon his successful development record with the Bank. ~ The senior Bank officer responsible for dealing with Mr. Porter was a longtime personal friend of the Porters and had administered the Bank’s previous loans to Mr. Porter. At the closing to acquire the Project property in October 1986, (a) Mr. Porter and FSBDC entered into a limited partnership agreement, (b) Mr. and Mrs. Porter executed a $275,000 note, secured by a mortgage on their home and representing one half of the equity in PLLP, and (c) Mr. Porter, both as General Partner and individually, executed a $2 million note, secured by a mortgage on partnership property. Mr. Porter’s liability under the $2 million note was limited by its terms to 50% of any deficiency. Mrs. Porter was not liable under the $2 million note. Shortly after the closing, the Bank told Mr. Porter that the October 1986 loan documents, which it had prepared, contained “technical deficiencies” that needed to be corrected. The Bank 1. BankNorth N.A. is the successor-in-interest to MetroWest Bank, which was Framingham Savings Bank before it changed its name. 3 assured the Porters that the new credit documents would not change the basis of the relationship between the Bank, FSBDC and the Porters or increase the Porters’ financial obligations. In March 1987, the Bank, as a condition for moving forward with the Project, required Mr. Porter to sign new credit documents. Mr. Porter, as General Partner of PLLP, signed a $550,000 note payable to FSBDC (“$550K Note”) secured by anew mortgage on the Partnership property (“S50K Mortgage’’). The Bank also required both Mr. and Mrs. Porter to sign a Guaranty that they later learned made them personally liable under both the $2 million note in favor of the Bank and the $550K note in favor of FSBDC. The Porters did so in reliance on the Bank’s repeated assurances that the new credit documents did not change the basis of the relationship between the Bank, FSBDC and the Porters or increase the Porters’ financial obligations. Contrary to such representations and assurances, the March 1987 credit documents — copies of which the Bank withheld from the Porters until after suit was commenced — made numerous substantive changes to the October 1 agreements, including: (a) improperly converting FSBDC’s capital contribution into partnership debt; (b) allowing FSBDC to charge interest on its capital contribution in violation of the partnership agreement; (c) conferring on FSBDC the nght to exercise as a lender precisely the control over the management of the Partnership that it expressly gave up when it agreed to be limited partner; (d) increasing Mr. Porter’s personal liability by requiring that he guarantee the full $2 million 4 note even though the note by its terms limited Mr. Porter’s liability to one-half of any deficiency; (e) rendering Mrs. Porter liable for the full amount of $2 million note and half of the $550K Note, despite the fact that she was a stranger to the Partnership and received no consideration for her guarantee. Mrs. Porter was required to sign because she was married to Mr. Porter. Mr. Porter, concerned about the softening real estate market and increased costs of construction during 1987, decided to build only one house at a time, not four as originally planned. In mid 1987, a senior Bank officer, also an officer of FSBDC, demanded that Mr. Porter begin construction on three homes. Mr. Porter warned that the Partnership did not have adequate funds to build three homes at the same time. The Bank assured Mr. Porter that it would timely provide any additional needed funds. Construction funds ran low in early 1988, slowing the Project and impairing the Partnership’s ability to pre-sell the partially completed homes. The Bank was reluctant to loan additional money to the Partnership until one home sold, despite its previous promises and assurances. Throughout the life of the Partnership, FSB and FSBDC each unilaterally paid themselves interest on their loans from partnership funds over _Mr. Porters’ objections. In June 1988, the Bank finally refinanced the Project, paying off the $2 million note and discharging the mortgage, and replacing them with a new $2.9 million note and mortgage. Without notice to the Porters,? FSBDC subordinated the $550K Note and related mortgage on the Partnership property to the new $2.9 million note and mortgage. By such unilateral and 2. Like the March 17 documents, the Bank failed to furnish a copy of the subordination agreement to the Porters until well after suit commenced. 5 undisclosed subordination, FSBDC (a) violated express terms of the Guaranty; (b) breached its duty of good faith and loyalty to Mr. Porter and the Partnership; and (c) materially increased Mrs. Forter’s financial exposure without consideration. By tate 1988, the Bank was subject to FDIC control and stopped making loan advances. Coupled with the falling real estate market, the Project failed and the partnership property was sold at a foreclosure sale. Had FSBDC not subordinated its mortgage, the $550,000 note as secured by a mortgage on the Porters’ home (the only remaining obligation under the Guaranty) would have been discharged from proceeds of the foreclosure sale of partnership property, as they far exceeded the amount needed to pay off the $550,000 note. A. Proceedings In The Superior Court of Massachusetts In June 1990, the Porters sued the Bank in the Superior Court of Massachusetts alleging wrongful conduct by the Bank in connection with the formation and operation of the Partnership and the execution of March 1987 credit documents. Count Ten alleged violations of M.GL. c.93A. It specifically challenged as unfair and deceptive the Bank’s insistence in March 1987 that the Porters sign new credit documents as new loan conditions. The Porters further alleged that FSBDC used the terms of the $550,000 note to unfairly exercise control over the Partnership by, among other things, unilaterally deducting interest on the $550,000 note from the Partnership’s account (which deprived the Partnership of crucial working capital) and insisting that Mr. Porter build three houses simultaneously against his advice. The Bank answered and interposed counterclaims seeking damages under notes, personal guarantees, and mortgage signed by the Porters in March 1987 and June 1988. The Porters’ 6 then-attorney, Edward Collins (““Mr. Collins’), filed an answer to the Banks’ counterclaims asserting affirmative defenses, including lack and/or failure of consideration and fraud in the inducement. While the Bank conducted extensive discovery under the Tracking Order, Mr. Collins failed to conduct any discovery until the week prior to the discovery deadline. In mid-April 1991, the Porters retained new counsel based on Mr. Collins’ failure to timely conduct discovery, account for a $70,000 retainer, and because he had been sanctioned by the Court on several occasions while representing the Porters. On May 3, 1991, Mrs. Porter informed Mr. Collins by telephone that he had been discharged and that new counsel had been retained. On Monday, May 6, 1991, the Porters sent Mr. Collins a letter confirming the May 3 phone call and asking that he immediately file a Notice of Withdrawal so new counsel could enter his appearance. The Porters and new counsel left telephone messages with Mr. Collins’ office on May 6, 7, and 8 asking him to transfer the case file and file a notice of withdrawal. | On May 8, 1991, new counsel left a message with the Bank’s counsel informing him that he was filing an appearance that day. On that day, six days after being formally discharged and prior to receiving any discovery from the Bank, Mr. Collins attended a final pre-trial conference in Middlesex Superior Court. He not only failed to inform the court of his discharge but agreed, without the Porter’s authorization or approval, to a Joint Pre-Trial Memorandum, prepared by the Bank’s counsel, which severely compromised the Porters’ rights and effected the entire future course of the litigation. Only after the fact did the Porters’ new counsel learn that a pre-trial conference had been held, attended by Mr. Collins, and that trial had been set for August 7, 1991. 7 At the pre-trial conference on May 8, the Bank filed a motion to file an Amended Counterclaim, which Mr. Collins did not oppose. On June 10, 1991, the Porters and PLLP answered the Bank’s amended counterclaim raising affirmative defenses, including illegal novation, lack and failure of consideration, and fraud in the inducement, each of which, if proven, would have barred recovery by the Bank on the loan and Guaranty.’ Despite Mrs. Porter’s request in early May 1991 that Mr. Collins immediately forward all files to the Porters’ new counsel, he neglected to do so until in late June 1991. Realizing, upon reviewing the file, that Mr. Collins had failed to conduct adequate discovery, the Porters’ new counsel attempted without success to enlarge the time for discovery and to continue the trial. In late June 1991, the Bank moved for partial summary judgment on counterclaims asserting liability of the Porters for deficiencies after foreclosure under a $2.9 million note to the Partnership (Count I), the $550K note (Count II), and the Porters’ Guaranty (Count III). The Porters opposed the Bank’s motion, supported by their own affidavits and references to their Verified Complaint. The Superior Court took no action on the Bank’s motion. In August 1991, Mr. Porter petitioned for bankruptcy protection. The Bank immediately moved to stay all state court actions while Mr. Porter was in bankruptcy. In September 1992, when the bankruptcy was dismissed, the Bank renewed its motion for partial summary judgment. On October 19, 1992, two days before the hearing on the Bank’s motion, the Porters filed supplementary affidavits and a 3. Incredibly, the Superior Court subsequently barred the Porters from raising several of the affirmative defenses raised in their Answer to the Bank’s amended counterclaim because they had not been included. in the Joint Pre-Trial Memorandum that pre-dated their Answer. 8 memorandum of law opposing the Bank’s motion and cross moved for summary judgment against the Bank under Chapter 93A. On October 20, 1992, the Bank moved to strike the Porters’ supplemental opposition to summary judgment. The Superior Court took no action on the Bank’s motion to strike the opposition. On October 22, 1992, the day after the summary judgment hearing, the Bank moved to strike the Porters’ cross-motion for summary judgment, which the Superior Court purportedly allowed on November 6, 1992. In December 1992, the Porters moved for leave to amend the Chapter 93A count of their complaint to assert that the credit documents executed by Mrs. Porter in March 1987 — challenged in the original complaint as unfair and deceptive, and the subject of the affirmative defenses of failure of consideration and novation in the Porters’ answer to the Bank’s amended counterclaim — violated federal credit law, a per se violation of Chapter 93A. The Porters specifically claimed in their propesed Amended Complaint that the Bank violated (a) the Equal Credit Opportunity Act, 15 U.S.C. §§ 1691, et seq., and enabling regulation, 12 C.F.R. §§ 202.1, et seq.) (“ECOA”’) by requiring Mrs. Porter to guaranty the partnership’s debt when the Bank considered Mr. Porter creditworthy, and (b) the anti-tying provision of the Bank Holding Company Act (“BHCA”), 12 U.S.C. §§ 1972(1)(C), (D) et seg.), by conditioning the Bank’s performance under the original October 1986 partnership and loan agreements between Framingham Savings Bank, FSBDC, Mr. Porter and PLLP on the Porters’ agreement to furnish additional consideration in the form of the $550,000 note and mortgage and personal guaranty. The motion to amend was based on credit documents that the Bank had failed to provide to the Porters until after suit was commenced. It was filed as soon as Mr. Porter’s motion to 9 dismiss the bankruptcy was allowed over the Bank’s opposition. The Bank opposed the Porters’ motion but made no showing of prejudice. At the same time, the Porters also moved to vacate the Pre-Trial Memorandum based on the undisputed fact that Mr. Collins attended the pre-trial conference a week after he had been discharged, a fact which Mr. Porter had documented more than a year earlier in a sworn affidavit. - On December 8, 1992, the Superior Court, without hearing and without explanation, denied both the motion to amend and motion to vacate. In April 1993, the Superior Court allowed the Banks’ motion for partial summary judgment, finding “allegations of fraud [contained in the Porters’ affidavits and Verified Complaint] insufficient” to satisfy the Porters’ burden to allege fraud by specific facts. Pet. App. 14a. The court did so notwithstanding a statement earlier in its opinion that the affidavits raised a material issue of fact whether the Bank obtained the Porters’ signatures on the Guaranty by fraud. At a final pretrial conference in October 1993 the Porters again moved unsuccessfully to vacate the Pre-Trial memorandum. In December 1993, the court entered a procedural order confirming that the Pre-Trial Memorandum governed the issues to be litigated at trial. Prior to the beginning of the trial, the Porters once again asked the Superior Court to consider their federal claims. The court agreed to hold a hearing on the issue, but later determined that the claims could not be considered because they were not included in the Pre-Trial Memorandum. The Porters’ claims were tried to a jury in March 1994, with the Superior Court expressly reserving the Porters’ claims under Chapter 93A, including those challenging provisions of the March 1987 credit documents as unconscionable and alleging unfairness in the subordination by FSBDC of the 10 $550,000 note and mortgage. The special question posed to the jury on the common law fraud count asked whether the Porters had proved that the Bank made any “fraudulent misrepresentations,” thus lumping together under a single question five of the six elements the Superior Court had instructed the jury the Porters were required to establish in order to prove fraudulent misrepresentation. The jury returned a verdict in favor of the Bank on the issues of fraudulent misrepresentations and breach of contract.’ On May 11, 1994, the Superior Court entered a Corrected Final Judgment in favor of the Bank on all counts of the Porters’ complaint and awarded the Bank damages on the counterclaims. The court made no finding of facts with respect to the Porters’ Chapter 93A claims, nor did it state separately its conclusions of law with respect to such claims as required under Mass. R. Civ. P. 52(a). It simply ordered entry of judgment on such claims based “[u]pon the jury’s verdict. .. .” Pet. App. 6a. B. Proceedings In The Appeals Court Of Massachusetts The Porters appealed to the Massachusetts Appeals Court arguing, among other things, that the Superior Court had erred in failing to rule on the Porters’ Chapter 93A claims, refusing to permit amendment of their complaint to assert their federal claims under the ECOA and BHCA, both before and during tnal, and requesting entry of judgment as a matter of law on such federal claims. By Memorandum and Order dated September 10, 2003, the Appeals Court affirmed the judgment of the Superior Court in its entirety, relying in large part on specious arguments advanced by the Bank in its brief. Pet. App. 1a-Sa. The Appeals Court held that the Porters’ federal claims under the ECOA and BHCA were “correctly ruled to be not properly part of the case, either as independent causes of action or as support for the 93A claims.” Pet. App. 2a. 4. But for the Trial Court’s repeated pre-trial and mid-trial admonitions, which shaped the Porters’ trial presentation, they could have presented evidence sufficient to support a finding of fraud against the Bank. 11 C. Proceedings In The Supreme Judicial Court of Massachusetts The Porters sought further review in the Supreme Judicial Court of Massachusetts of the rulings of the Superior Court and Appeals Court. By Order dated October 29, 2003, the Court denied petitioners’ Application For Further Appellate Review without comment. Pet. App. 15a. REASONS FOR GRANTING THE PETITION A. The Porters Were Deprived Of Their Rights Under The - Federal Equal Credit Opportunity Act And Bank Holding Company Act By The State Court’s Novel Application Of Its Procedural Rules. 1. This Court has the power to determine whether a state court has improperly by-passed a federal right under a form of local procedure. This Court has jurisdiction to hear petitioners’ appeal because the state courts’ actions and inactions, many made without explanation and all in plain conflict with controlling precedent and applicable rules of practice and procedure, together deprived Petitioners of any real opportunity to enforce their rights under federal credit and banking law. The Porters’ federal claims were presented to the Massachusetts courts, which were apprised of the nature and substance of such claims. Ellis v. Dixon, 349 U.S. 458, 463 (1955). This Court is not prevented by the “state court’s determination as to the sufficiency of the pleadings asserting a federal right,” because it has the power to determine de novo “whether the state court has by-passed the federal nght under forms of local procedure.” Jd. “The issue of whether a federal question was sufficiently and properly raised in the state courts is ultimately a federal question, as to which this Court is not bdund by the decision of the state court.” Street v. New York, 12 394 U.S. 576, 583 (1969); accord, Howlett v. Rose, 496 U.S. 356, 366 (1990). 2. The refusal by the Massachusetts court to hear the Porters’ federal claims was outcome determinative. A state ground is not adequate to preclude review in this Court where, as here, a decision on the federal issue would change the outcome of the case. See Chicago B. Q. Ry. y. Drainage Comm'rs, 200 U.S. 561, 580 (1906). When a loan applicant qualifies under a lender’s standards of creditworthiness and the loan is granted based on the : applicant’s willingness and ability to repay, the lender cannot require the spouse of the applicant to sign any credit documents relating to the loan transaction. See 12 C.F.R. § 202.7(d)(1). To do so violates the ECOA and Regulation B> See United States v. Consumer Fin. Corp., 816 F.2d 487, 491 (9" Cir. 1982); Anderson v. United Finance, 666 F.2d 1274, 1277 (9" Cir. 1982); Shammas v. New England Merchants Nat'l Bank, 1990 WL 354452 (D. Mass. 1990), quoting Anderson, 666 F.2d 1277(“‘Where a spouse’s guaranty is required when an individual is creditworthy on his or her own, the spouse’s guarantee is illegal.””). At trial, the Bank’s Vice President admitted that the Bank — considered Mr. Porter to be creditworthy in March 1987 when the Bank required Mrs. Porter to sign the Guaranty, note and mortgage securing the Bank’s loans to Mr. Porter and the Partnership. Such testimony was sufficient to establish that the March 1987 credit documents violated the ECOA and Regulation B as a matter of law. Likewise, a violation of the anti-tying provision of the BHCA by the Bank was established at trial as a matter of law. The provision provides in pertinent part that a “bank shall not extend credit, furnish any service or vary the consideration for any of the foregoing on the condition or requirement that the | AS ong re ROT ec a a tating 7 a