NOT RECOMMENDED FOR PUBLICATION 

File Name: 17a0158n.06 

No. 16-2160 

UNITED STATES COURT OF APPEALS 

FOR THE SIXTH CIRCUIT

JANICE POTTER, et al. 

 Plaintiffs-Appellants, 

v. 

WILMINGTON SAVINGS FUND, et al. 

 Defendants-Appellees. 

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ON APPEAL FROM THE 

UNITED STATES DISTRICT 

COURT FOR THE WESTERN 

DISTRICT OF MICHIGAN 

BEFORE: KEITH, ROGERS, and KETHLEDGE, Circuit Judges. 

 ROGERS, Circuit Judge. Plaintiffs Janice and David Potter brought a quiet-title suit 

against Wilmington Savings Fund and Bank of America, the current and former mortgagees, 

respectively, of the Potters’ home. The Potters faced foreclosure in 2010. Their house was sold 

at a sheriff’s sale and their mortgage was extinguished. However, in 2014 Bank of America 

recorded an affidavit under Michigan law, purporting to expunge the sheriff’s sale and reinstate 

the mortgage, thereby setting aside the foreclosure. The Potters now argue that this affidavit 

succeeded in expunging the sheriff’s sale but failed to reinstate the mortgage. Therefore, the 

Potters contend, they now own the house outright, unencumbered by a mortgage. 

 The district court dismissed the Potters’ quiet-title claim, concluding that the affidavit 

both expunged the sale and reinstated the mortgage, such that the Potters own the property 

encumbered by a mortgage. As the court further reasoned, even if the affidavit were invalid, the 
No. 16-2160, Potter v. Wilmington Savings 

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affidavit would be invalid in its entirety, neither expunging the sale nor reinstating the mortgage, 

such that the Potters would now be living on the property with no title at all. The district court’s 

reasoning was correct: in either event, no quiet-title relief was warranted. 

 Janice and David Potter recorded a mortgage for their home in February 2007. A few 

years later, the Potters ran into financial difficulty. They defaulted on their mortgage in March 

2009 and filed for Chapter 7 bankruptcy in June 2009. As a result of the bankruptcy, the Potters’ 

personal obligations for their mortgage were discharged, although the property remained 

encumbered by the mortgage. 

 After the bankruptcy, the original mortgagee assigned its interest in the property to BAC 

Home Loans Servicing, L.P. BAC initiated foreclosure proceedings against the Potters’ 

property. BAC ended up purchasing the property itself by sheriff’s deed in March 2010. The 

Potters did not redeem the property. BAC then transferred title of the property to Fannie Mae by 

quitclaim deed. Fannie Mae, in turn, transferred title to Bank of America, also by quitclaim 

deed. Bank of America is therefore the successor by merger to BAC, as well as the first 

defendant in this case. 

 Around 2012, the Potters allegedly sought rescission of the sheriff’s deed, which would 

have reinstated the mortgage but also allowed them to be reviewed for a loan modification or 

another loss-mitigation alternative. To this end, in April 2012, Bank of America executed an 

“Affidavit Expunging Sheriff’s Deed on Mortgage Filed Pursuant to MCLA 565.451a.” 

Through this affidavit, Bank of America declared: 
No. 16-2160, Potter v. Wilmington Savings 

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 . . . 

 4. That MORTGAGEE will not rely on said foreclosure sale and will treat 

 such sale as having not been held and void. 

 5. That MORTGAGEE wishes this Affidavit to be recorded in order to correct 

 record title and to show that the Sheriff’s Deed dated March 31, 2010 . . . is 

 hereby expunged, and that the mortgage recorded on February 2, 2007 . . . 

 is in full force and effect. 

 Section 565.451a of the Michigan Compiled Laws allows “any person having knowledge 

of the facts” to record an affidavit “stating facts relating to ... [k]nowledge of the happening of 

any condition or event which may terminate an estate or interest in real property.” M.C.L. § 

565.451a(b). As will be discussed in greater detail below, it is the practice in Michigan to use 

M.C.L. § 565.451a to record affidavits that expunge a previous foreclosure sale and reinstate a 

mortgage. Thus, Bank of America’s affidavit under M.C.L. § 565.451a was intended to restore 

the status quo before the March 2010 sheriff’s sale, with the Potters again as mortgagors but 

Bank of America as the new mortgagee. The Potters apparently did not make any payments on 

their reinstated mortgage and continued to live in the house. 

 In March 2014, Bank of America assigned its interest in the property to the Wilmington 

Savings Fund, as a trustee of the Primestar-H Fund 1 Trust. Wilmington Savings is the second 

defendant in this case. 

 Wilmington Savings initiated another foreclosure on the property in October 2014. In 

response, the Potters filed a quiet-title complaint in Michigan state court against Wilmington 

Savings Fund, launching this litigation. The Potters also joined Bank of America, which, as a 

citizen of North Carolina for diversity purposes, removed the case to federal court. After 

discovery, both defendants moved for summary judgment. 
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 In opposition to the defendants’ motion for summary judgment, the Potters made the 

legal argument they now make on appeal. The Potters argued that the sheriff’s sale by BAC in 

March 2010 extinguished their mortgage. Therefore, BAC, as the purchaser of the property as 

well as the mortgagee, took unencumbered title to the property. BAC then transferred this title to 

Bank of America. Thus, when Bank of America declared in Paragraph Four of the affidavit that 

it “will not rely on said foreclosure sale and will treat such sale as having not been held and 

void,” it was in effect giving title back to the Potters. However, although the Potters accept the 

validity of Paragraph Four of the affidavit expunging the sale, they deny the validity of 

Paragraph Five’s reinstatement of the mortgage, arguing that Bank of America cannot 

unilaterally declare that the mortgage is “in full force and effect.” The Potters contend that 

because Paragraph Four of the affidavit is valid but Paragraph Five is not, Bank of America gave 

the Potters back their property but failed to reinstate the mortgage, such that the Potters now own 

the property free of any mortgage. 

 The district court rejected the Potters’ argument. Although the court acknowledged some 

problems with the use of M.C.L. § 565.451a affidavits to reinstate mortgages, it concluded that 

the affidavit was at most voidable by the benefited party—Bank of America—and in any event, 

could not be “split up” so that it succeeded in giving the Potters back the property but failed in 

reinstating the mortgage. The court concluded that “[a]ny other result means that the Potters get 

a free house, which I think is just not saleable.” 

 The Potters now appeal, but their argument lacks merit. 

 Michigan case law demonstrates that that a mortgagee can use an affidavit filed pursuant 

to M.C.L. § 565.451a to both expunge a sheriff’s sale and revive a mortgage, returning two 

parties to the status quo before a sale. For example, this case is on all fours with Freund v. Trott 
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& Trott, P.C., where a mortgagee foreclosed on a piece of property, but then executed an 

“Affidavit Expunging Sheriff's Deed on Mortgage Sale” asserting that it “will not rely on said 

foreclosure sale and will treat such sale as having not been held and void ab initio.” No. 299011, 

2011 WL 5064248, *2 (Mich. Ct. App. Oct 25, 2011) (per curiam). Based on this affidavit, the 

Michigan Court of Appeals concluded that foreclosure had been set aside, in effect both 

expunging the sale and reinstating the mortgage. Id. It apparently did not even occur to the 

court to give effect to the provision of the affidavit expunging the sale but not the provision 

reinstating the mortgage. 

Freund is not an isolated case. In Cordes v. Great Lakes Excavating & Equip. Rental, the 

Michigan Court of Appeals upheld an affidavit under M.C.L. § 565.451a whereby the mortgagor 

agreed to undo the discharge of a mortgage. No. 304003, 2012 WL 2052789, *2 (Mich. Ct. App. 

2012). Again, based on this affidavit, the court concluded that the discharge had been set aside, 

in effect reinstating the mortgage. Id. Again, there was no suggestion that only the discharge 

could be expunged by affidavit, but the mortgage could not be reinstated. Similarly, in Davis v. 

GMAC, the Michigan Court of Appeals gave effect to the mortgagee’s act whereby it “rescinded 

the foreclosure, expunged the sheriff's deed, and reinstated plaintiff's mortgage.” No. 307721, 

2014 WL 2751046, *3 (Mich Ct. App. June 17, 2014). Although the Davis opinion is silent as to 

whether this expungement and reinstatement was accomplished by an affidavit under M.C.L. 

§ 565.451a, the case at least stands for the proposition that expungement and reinstatement can 

be accomplished simultaneously. Relying on these Michigan cases, federal courts in this circuit 

also have upheld such affidavits that both expunge a sale and reinstate a mortgage. For example, 

in Wuori v. Wilmington Savings Fund Society, this court held that an affidavit under M.C.L. 

§ 565.451a could both expunge a sheriff’s sale and revive a mortgage. 2016 WL 7378407 at *4 
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(6th Cir. Dec. 20, 2016); see also Connolly v. Deutsche Bank Nat. Trust Co., No. 12–12517, 

2013 WL 4084742, *5-*6 (E.D. Mich. Aug. 13, 2013), aff’d in Connolly v. Deutsche Bank Nat. 

Trust Co., 581 F. App’x 500, 505-06 (6th Cir. 2014). 

 True, the cases set forth above are not from the Michigan Supreme Court, which should 

be the first source of state law for a federal court sitting in diversity, see Erie R.R. Co. v. 

Tompkins, 304 U.S. 64 (1938). However, when a state’s highest court has not addressed a 

particular issue, a federal court may rely on a state’s lower courts as well as other federal courts 

construing state law in order to ascertain how the highest state court would rule if were faced 

with that issue. Meridian Mut. Ins. Co. v. Kellman, 197 F.3d 1178, 1181 (6th Cir. 1999). Here, 

caselaw from the Michigan Court of Appeals and federal courts applying Michigan law indicates 

that the Michigan Supreme Court would hold that an affidavit under M.C.L. § 565.451a can both 

expunge a sheriff’s sale and revive a mortgage. 

 Therefore, this court must agree with the district court’s conclusion that the Bank of 

America affidavit is valid, such that the Potters have title to the property but Wilmington is the 

mortgagee. The Potters were not entitled to quiet-title relief. 

 The Potters seek to resist this reading of Michigan law. Their argument relies almost 

entirely on a single Michigan Court of Appeals case: Trademark Properties of Michigan, LLC v. 

Federal Nat. Mortg. Assn., 863 N.W.2d 344 (Mich. Ct. App. 2014). In Trademark, the court 

reasoned that “A foreclosure of a mortgage extinguishes it . . . and the purchaser becomes the 

owner of an equitable interest in the mortgaged premises which ripens into a legal title if not 

defeated by redemption as provided by law.” Id. at 349 (citing Dunitz v. Woodford Apartments 

Co., 209 N.W. 809, 810 (Mich. 1926)). The court further reasoned that “‘[s]tatutory foreclosures 

should not be set aside without some very good reasons therefor.’ A ‘strong case of fraud,’ 
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irregularity, or ‘some peculiar exigency’ is required to set aside a statutory foreclosure sale.” Id.

(citing Markoff v. Tournier, 201 N.W. 888 (Mich. 1925); Kubicki v. Mtg. Electronic Registration 

Sys., 807 N.W.2d 433 (Mich. Ct. App. 2011). After quoting this language, the Trademark court 

held that the affidavit in that case setting aside a foreclosure was invalid. Id. at 350-51. Because 

that affidavit was also recorded under M.C.L. § 565.451a, the Potters argue that Trademark

generally prevents reinstatement of a mortgage by affidavit under M.C.L. § 565.451a. 

 However, the Potters’ reliance on Trademark is misplaced. First of all, the Trademark 

court appears to have set aside the entire foreclosure, see id. at 350, thereby both expunging the 

sale and reinstating the mortgage. Therefore, even if Trademark can be read for the proposition 

that affidavits under M.C.L. § 565.451a cannot set aside an entire foreclosure, it does not support 

the Potters’ preferred outcome that such an affidavit can set aside half a foreclosure, i.e., 

expunge the sale but not reinstate a mortgage. 

 Second, unlike the cases set forth above, Trademark involved an affidavit that was 

invalid for an independent reason. In order to justify voiding the sheriff’s sale, the mortgagee’s 

affidavit cited an unrelated Michigan Court of Appeals Case that held that the particular type of 

foreclosure employed was void. See Residential Funding Co., LLC v. Saurman, 807 N.W.2d 412 

(Mich. Ct. App. 2011) (“Saurman I”). However, in the time between the recording of this 

affidavit and the decision in Trademark, the Michigan Supreme Court reversed the Michigan 

Court of Appeals, holding that the particular type of foreclosure employed could be valid. See 

Residential Funding Co., LLC v. Saurman, 805 N.W.2d 183 (Mich. 2011) (“Saurman II”). Even 

though the Trademark court cited language suggesting that foreclosure cannot be set aside by 

affidavit, the court ultimately chose to decide the case on this discrepancy between Saurman I 

and Saurman II, reasoning “we need not decide the effect of the filing of an affidavit when a 
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foreclosure sale was void ab initio because, here, the foreclosure sale was not void.” Trademark, 

863 N.W.2d at 350. In other words, Trademark did not hold that affidavits cannot set aside a 

foreclosure, but only that a particular affidavit was invalid for an independent reason. Therefore, 

Trademark cannot support the Potters’ argument against Freund, Cordes, and Davis. 

 Moreover, even assuming that the affidavit under M.C.L. § 565.451a was invalid for 

some reason, then the property would not have been lawfully returned to the Potters, and quiettitle relief would not be warranted. We are cited no authority to the contrary in that regard. 

 For these reasons, we affirm the judgment of the district court dismissing the Potters’ 

quiet-title suit.