You can’t expect a bank that is dumb enough to sue itself to know why it is suing itself.

Yet I could not resist asking Wells Fargo Bank NA why it filed a civil complaint against itself in a mortgage foreclosure case in Hillsborough County, Fla.

“Due to state foreclosure laws, lenders are obligated to name and notify subordinate lien holders,” said Wells Fargo spokesman Kevin Waetke.

Being a taxpayer-subsidized, too-big-to-fail institution, it’s possible that one of the few ways for Wells Fargo & Co. (WFC) to know what it is doing is to notify itself with a court filing.

In this particular case, Wells Fargo holds the first and second mortgages on a condominium, according to Sarasota, Fla., attorney Dan McKillop, who represents the condo owner.

As holder of the first, Wells Fargo is suing all other lien holders, including the holder of the second, which is itself.

“The primary reason is to clear title and ownership interest in a property to prepare it for sale,” Waetke said in an email exchange. “So it really is not Wells Fargo vs. Wells Fargo.”

Yet court documents clearly label “Wells Fargo Bank NA” as the plaintiff and “Wells Fargo Bank NA” as a defendant.

Wells Fargo hired Florida Default Law Group., P.L., of Tampa, Fla., to file the lawsuit against itself.

And then Wells Fargo hired another Tampa law firm — Kass, Shuler, Solomon, Spector, Foyle & Singer P.A. — to defend itself against its own lawsuit, according to court documents.

Wells Fargo’s defense lawyers even filed an answer to their client’s own complaint.

“Defendant admits that it is the owner and holder of a mortgage encumbering the subject real property,” the answer reads. “All other allegations of the complaint are denied.”

This is even dumber than the lending practices that led to this foreclosure mess, yet this is what the court record says. I learned about this from “The Consumer Warning Network” Web site, which posted an article by Angie Moreschi titled, “Have The Banks Gone Crazy?”

“We’ve apparently reached the perfect storm for complete and utter idiocy by some banks trying to foreclose on homes,” Moreschi wrote.

McKillop, the condo owner’s attorney, told me he thinks Wells Fargo doesn’t know what it’s doing, and that its lawyers figure it is all billable hours to them.

“You can’t sue yourself,” McKillop said. “It’s just so ridiculous. .. It’s a waste of paper. It’s a bastardization of the legal process.”

Wells Fargo’s two law firms didn’t return messages to explain their filings.

The condo owner is belly up and hired McKillop to pursue a “friendly foreclosure,” attempting to escape any lingering liabilities after the foreclosure sale.

“It was a property they thought they were buying as a good investment as a lot of people did back in 2005 and 2006,” McKillop said. “All we want to do now is get this property taken care of as fast and as easily as possible for all parties.”

Rather than suing itself — a stunt that was never even attempted on the MTV show “Jackass” — wouldn’t it be easier for Wells Fargo to release one of the liens to itself? Or pursue some other internal accounting strategy rather than tie up the court with nonsense?

“This is just folks cranking out paperwork without conscious thought,” said Anthony Sabino, a law professor at St. John’s School of Law in New York City.

Sabino added that it is possibly more confirmation of the old saw that a lawyer is one who can speak from both sides of the mouth.

Still trying to comprehend this legal lunacy, I called the Florida Bar, which put me in touch with Florida mortgage foreclosure lawyers. One of them, Tampa attorney Kristofer Fernandez, said he’s seen several cases where a large bank has sued itself for foreclosure as the holder of both first and second mortgages.

“Four or five years ago, you would have never seen this,” Fernandez said. “Now, it’s very common.”

In the final years of the housing boom, banks were lending to homeowners with no money down. To do this, they often made 80/20 loans, giving homeowners an 80% first mortgage and a 20% second mortgage.

Now, it seems these moronic mortgages require moronic foreclosures.

Perhaps this strategy may speed up a summary judgment. Or maybe it preserves the position of the second lien holder so it is next in line to collect surplus funds after the first lien is satisfied, Fernandez said.

But fat chance of surplus proceeds in the Florida condo foreclosure market these days.

It takes some pretty shameless lawyers and a rich culture of corporate stupidity for a company to sue itself. I hope Wells Fargo loses this case and ends up having to drag itself all the way to the Supreme Court.

Comments from readers:

July 13. 2009

Ha! A bank suing itself is almost as ridiculous as a monetary system that’s based on credit. Oh wait… I guess that’s why we seem to be eating our own tails. Because we’ve allowed usury to become our sole means of creating wealth. The only way to pay back the interest owed on the wealth that was created at interest is to create more money loaned at interest to pay back the interest on the money that was created on interest. Seriously. it doesn’t take a genius to realize that an economy based on credit and perpetual growth is doomed to fail. Everything moves in cycles. The earth, the moon, the sun, the environment even our economy. By creating an economy based on credit and perpetual growth we created and economy that is doomed to fail and fall back on itself. The only way to fix this problem is to change the way our monetary system works. Based on something of actual value that recycles and renews itself. Like saaay uummm water or air or plant life. Like something tangible instead of imaginary. Duh. But I guess that makes too much sense and if everyone understood the way the economy worked then no one could control it and that would mean we go back to being in “God’s” hands instead of the Banks. And We wouldn’t want that would we? To give up control of our destiny back to God? That would be kind of like heaven on earth wouldn’t it?

• splattermonkey

July 13. 2009

Funny that the corporation making fun of Wells Fargo is the one that almost did the same thing a few years ago.

• andrewmull, NY

July 13. 2009

Florida is a judicial foreclosure state. Meaning all foreclosures are addressed by the court system. The Florida law requires that the lienholder bringing foreclosure suit against the defaulting borrower…..also include ALL junior lienholders in the suit. Wells fargo also has a junior lien. Hence it names itself as a defendent. A responsibility of the Junior lien holders is to re-affirm their lien….if it still exists. If they don’t respond to the complaint…the court assumes the lien is no longer valid. Because a foreclosure can be set aside if the plaintif doesn’t follow the letter of the law… Wells names itself as a defendent. Al’s article sites a foreclosure attorney…who states this is fairly common in Florida now for banks holding two liens against a property. So how dumb is Wells suing itself?? It is not. It conforms to the letter of the law. And again, Al’s article notes it is a frequent event in Florida today. Second…whether Wells loaned 100% of the property’s value via its two loans…we do not know!! If this was a “dumb” loan to start with…how do we know without seeing the loan file and application? And this will not be shared by a bank under privacy rules. I looked into this because this article seemed too hard to believe.

• rosel

July 13. 2009

Because the main goal of predatory mortgage lending is unfair advantage, companies like Wells Fargo aligns with shrewd foreclosure attorneys for the various benefits from unlawfully seized and flipped properties, mostly by use of names mortgage companies that lack standing or are defunct. REPEATED real estate FLIPPING enables companies like Wells Fargo to file false IRS form 1099-A’s, and also file fraudulent Bankruptcy Court “Lift Automatic Stay Motions.” News reports about foreclosure proceedings which judges have rendered VOID will help raise awareness for people who are being UNLAWFULLY EVICTED AND RENDERED HOMELESS by foreclosure which are NULL, and shams. Read more at: *http://www.lawgrace.org/2008/08/08/my-august-8-2008-statement-to-the-louisiana-secretary-of-state-office-of-financial-institutions-concerning-wells-fargo-irs-and-mortgage-frauds-sham-foreclosures-and-judicial-collusion-and-national-app/ AND *http://www.lawgrace.org/2008/09/14/lehman-brothers%E2%80%99-mortgage-troubles-nationally-evidence-of-foreclosure-fraud-deception-and-conspiracy-with-wells-fargo-deceptive-judicial-filings/. ALSO especially SEE paragraph 24>> “in a foreclosure action, a bank that was not the mortgagee when suit was filed cannot cure its lack of standing by subsequently obtaining an interest in the mortgage.” The entire pleading @ http://www.msfraud.org/law/lounge/Wellsfargov.jordan.pdf Barbara Ann Jackson Law & Grace, Inc

• lawgrace, Louisiana

July 13. 2009

It is what I have come to expect from the banks. It is just as stupid as forcing someone out of their home, at a cost of $130,000, when you could keep them in the house by lowering their balance and payments by $80,000. I guess now that the government is covering the majority of the loss, the banks have no incentive to work with homeowners. A neighbor owes $300,000 on a house that is now worth $174,000 (plus all the costs of selling it). He offered to stay in the house if they lowered the balance due to $215,000 and lowered the payment accordingly. The bank, in all its wisdom and great business expertise, agreed to a short sale at $174,000 … that is $41,000 plus the legal fees, repair and clean up costs, and sales fees. It is about time that the government stops spending OUR money this way. Make them accountable for their losses, due to their own stupidity. Then maybe we can turn this situation around! But I forgot … these are the same people that got us into this mess in the first place!

• one4tools, California