Source: http://masslegalresources.com/sullivan-et-al-v-kondaur-capital-corporation-lawyers-weekly-no-11-039-14
Timestamp: 2018-02-22 20:22:54
Document Index: 121362609

Matched Legal Cases: ['§ 54', '§ 70', '§ 8', '§ 8', '§ 4', '§ 1', '§ 2', '§ 54']

Sullivan, et al. v. Kondaur Capital Corporation (Lawyers Weekly No. 11-039-14) | Massashusetts Legal Resources
[2] Though executed on May 21, 2008, the assignment stated that it “has an effective date of December 12, 2007.”
[2] We reserve description of certain other details of the assignments to our discussion of the Sullivans’ challenges to their validity.
[2] Other than their contentions that Kondaur did not acquire valid title to the mortgage prior to the foreclosure, the Sullivans do not contend in this appeal that Kondaur failed to conduct the foreclosure in accordance with law.
[2] Kondaur also asserts that the Sullivans’ failure to challenge the validity of the assignments in its previous
[2] Our conclusion applies solely to a mortgagor’s challenge to an assignment asserting that it is void. A deficiency in an assignment that makes it merely voidable at the election of one party or the other would not automatically invalidate the title of a foreclosing mortgagee, and accordingly would not render void a foreclosure sale conducted by the assignee or its successors in interest.
[2] We note that our conclusion that the Sullivans have standing to challenge Kondaur’s title to the mortgage (and, consequently, its legal authority to foreclose their equity of redemption) is consistent with that of the First Circuit Court of Appeals in Culhane v. Aurora Loan Servs. of Neb., 708 F.3d 282, 291 (1st Cir. 2013). Compare Wilson v. HSBC Mort. Servs., Inc., 744 F.3d 1, 14 (1st Cir. 2014) (no standing where homeowners’ complaint alleged that officer who executed assignment on behalf of assignor was also an officer of assignee and executed assignment on behalf of the latter).
[2] It is unclear whether Kondaur’s argument on this point is properly before us. Though Kondaur made the argument to the Land Court judge in a supplemental brief filed in response to the
[2] In pertinent part, G. L. c. 185, § 54, provides that “[t]he original certificate [of title] . . . shall be conclusive as to all matters contained therein, except as otherwise provided in this chapter.”
[2] We reject Kondaur’s suggestion that G. L. c. 185, § 70, implicitly requires any such challenge to be brought before issuance of a new certificate of title following foreclosure, by providing that “this chapter shall not prevent the mortgagor or other person in interest, prior to the entry of a new certificate of title, from directly impeaching, by bill in equity or otherwise, any foreclosure proceedings affecting registered land” (emphasis added). The quoted language appears at the end of a sentence describing the method by which the purchaser at a foreclosure sale may obtain a new certificate of title by registering the foreclosure deed and need not, in our view, be applied to limit a challenge in circumstances such as those in the present case, where the purchaser at the foreclosure sale also conducted the sale under a claim that it held a valid title to the mortgage.
[2] Certain of the challenges raised by the Sullivans in the Land Court are absent from their brief on appeal. For example,
[2] The Sullivans’ argument on this point takes various forms and is difficult to decipher. They observe that their mortgage loan was included in a pool with other mortgage loans and then securitized, suggesting that WMC assigned its equitable interest in the loan to another lender, who in turn assigned it at least once more, before MERS assigned the mortgage to Saxon. Accordingly, the argument goes, MERS could not validly have assigned the mortgage, because WMC (the entity as nominee for which MERS acquired its bare legal interest) then held no equitable interest in the loan. More broadly, they appear to suggest that any separation of the legal and ownership interests in a mortgage is inherently invalid under Massachusetts law. We address both variants.
[2] Subsequently, in Galiastro v. Mortgage Elec. Registration Sys., Inc., 467 Mass. 160, 167 (2014), the Supreme Judicial Court extended application of the Eaton rule to “cases that were pending on appeal in the Appeals Court when the rescript in Eaton issued, and in which the litigants asserted and preserved a claim that a foreclosure by power of sale is invalid where the foreclosing mortgagee does not hold the note.”
[2] Notice of the foreclosure sale in the present case was given on September 16, 2009. The Sullivans commenced the action in the Superior Court on March 8, 2010, and (following transfer to the Land Court) judgment entered on January 25, 2013. The case entered on the docket of the Appeals Court on April 29, 2013.
[2] Though the note itself is not in the record, Kondaur represents in its brief on appeal that it is in possession of the original note, endorsed in blank by WMC.
[2] We note that our conclusion in this respect is again consistent with that reached by the First Circuit Court of Appeals in Culhane v. Aurora Loan Servs. of Neb., supra at 291-293.
[2] Because the proposed second amended complaint merely sought to elaborate the same claim, it did not (as the Sullivans contend) address each deficiency cited by the Land Court judge in the amended verified complaint he dismissed. The judge accordingly did not abuse his discretion in denying (on grounds of futility) the Sullivans’ motion to further amend their complaint. We likewise discern no error or abuse of discretion by the Land Court judge in his dismissal of those counts of the Sullivans’ complaint which are beyond the Land Court’s limited jurisdiction.
[2] An exception exists for instruments signed by the president or vice president and the treasurer or assistant treasurer, which require neither authorizing vote nor evidence of incumbency. See G. L. c. 155, § 8; G. L. c. 156D, § 8.46. See also Eno & Hovey, Real Estate Law, § 4.39 (4th ed. 2004); Title Standard No. 11 of the Real Estate Bar Association for Massachusetts (2009), as appearing in Eno & Hovey, Real Estate Law c. 58, at 336 (Supp. 2013).
[2] Section 54B was initially enacted by St. 1992, c. 410, § 1, and its scope was expanded by St. 2006, c. 63, § 2. Legislative history suggests that the purpose of the section, and its subsequent expansion, was to address problems that often arose in recording discharges or assignments executed by non-Massachusetts corporations who were unfamiliar with Massachusetts recording formalities, particularly following the growth of the secondary market and securitization of mortgages. See, e.g., testimony of E. Christopher Kehoe, presented May 18, 2005, to the Joint Committee on Financial Services concerning Senate Bill 624.
[2] Kondaur suggests we should infer that Flowers’s act in signing the document on the signature line beneath Saxon’s name constituted an assertion that she held one of the offices listed in § 54B and was authorized to act on its behalf. Were we to do so, we would render superfluous much of the language contained in the statute. If the Legislature intended to provide that any individual could bind a corporate mortgagee by signing a mortgage assignment on its behalf, without any indication of her office or authority, it could have done so with far less detail than set forth in the statute it enacted.
[2] We note that the deficiency in the second assignment may well be one of form rather than of substance, and may therefore be susceptible of cure of the type described in Ibanez, supra at 654 (“Where the earlier assignment is not in recordable form or bears some effect, a written assignment executed after foreclosure that confirms the earlier assignment may be properly recorded”).
Posted by Stephen Sandberg - April 16, 2014 at 3:57 pm