Editor: David Reiss
Brooklyn Law School

February 11, 2013

Federal District Court in Idaho Rules for Banks/MERS in Foreclosure Case

By Rafe Serouya

In Showell v. BAC Home Loans Servicing, L.P., 4:11-CV-00489-CWD, 2012 WL 4105472 (D. Idaho Sept. 17, 2012), the Court granted Defendants’ motions to dismiss. The Court once again held that since Idaho is a nonjudicial foreclosure state, standing, or proof of ownership of the underlying note, is not required before a proceeding is initiated. Plaintiff Homeowners’ quiet title claim failed because a “mortgagor cannot without paying his debt quiet title as against the mortgagee.” Additionally, MERS was found to have authority to foreclose on the defaulted property. MERS was given the authority to exercise the rights described in the Deed on behalf of the lender as the lender’s agent. Additionally, Plaintiffs’ argument that MERS did not have the ability to assigned interests based upon its “nominee” status was dismissed by the Court since “there is no requirement in the Deed of Trust that the original Lender grant MERS permission to assign MERS’s interest in the Deed of Trust to lenders’ successor in interest.” Plaintiffs’ various other claims were dismissed for failure to support their claims, or state a claim at all. The most common of the arguments that were dismissed was that the Note and Deed being split renders them unenforceable. The Court concluded that splitting the Note and Deed does not preclude the proper Defendant from foreclosing on the Deed of Trust.

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