Editor: David Reiss
Brooklyn Law School

July 16, 2013

California Court Affirms MERS’ Authority to Assign its Interest Under a Deed of Trust

By Ebube Okoli

The court in Hollins v. ReconTrust et al., Civil No. 2:11-cv-00945-PSG –PLA (C.D. Cal. May 6, 2011) affirmed MERS’ authority to assign its interest under a deed of trust and granted MERS’ motion to dismiss. The plaintiffs claimed that the foreclosure proceedings initiated by the U.S. Bank as well as ReconTrust were not valid. Moreover, the plaintiff claimed that MERS lacked the authority to assign the deed of trust.

The court considered the plaintiff’s contentions, but rejected the argument. In rejecting the palintiff’s argument, the court found that “federal and state courts in California have repeatedly rejected similar challenges to MERS in cases where the plaintiff expressly authorized MERS to act as a beneficiary.” Regarding the plaintiffs’ allegation that U.S. Bank was not authorized to foreclose due to lack of “documentation evidencing the proper status of U.S. Bank as a party in interest,” the court found the allegation “negated by a judicially noticeable record of assignment from MERS to U.S. Bank.” Last but not least, the plaintiffs’ failure to tender was fatal to their claims.

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