January 27, 2014
Maine Superior Court Denies Foreclosure Action Because Bank Failed to Strictly Follow Statutory Notice Requirement
In Bank of N.Y. Mellon v. McKenna, the Superior Court of Maine precluded a foreclosure action on a finding that the plaintiff bank failed to strictly follow the relevant statutory notice requirements.
In 2007, defendant Robert McKenna (“McKenna”) bought a home in Maine with a mortgage for $245,000.00 from First Magnus Financial Corporation (“First Magnus”) and MERS. In September 2008, MERS sold the mortgage to plaintiff Bank of New York, which had been acquired by plaintiff Bank of New York Mellon (“Mellon”) in July 2007. McKenna defaulted on the loan in April 2008. Mellon later bought McKenna’s loan from MERS in November 2012. In July 2013, Mellon initiated a foreclosure action against McKenna.
However, in this case the Maine Superior Court entered a judgment against Mellon. The Court found that Mellon failed to strictly comply with the notice and service requirements under Maine state law. Specifically, the Court noted that the relevant statute required a mortgagee to provide notice to all mortgagors and all cosigners who had a right to cure the mortgage default 35 days before the start of the foreclosure action. Here, the Court found that Mellon only served notice on Robert McKenna, and not his wife and co-defendant, Nancy McKenna. The Court found that the lack of notice to Nancy McKenna represented a failure to strictly follow the statutory requirements for foreclosure actions. The Court therefore entered a judgment in favor of McKenna.