Tag Archives: banks

Minnesota District Court Dismisses Plaintiff’s Fraud Claims and Holds That MERS Had Legal Title and Authority to Foreclose

Posted on by

The Minnesota District Court in Allen v. Wilford & Geske et al.,No. 70-CV-10-29502 (D. Minn. May 9, 2011), after hearing the plaintiff’s contentions, dismissed his complaint for foreclosure fraud. The court held that MERS had legal title and authority to foreclose.

By granting the defendants’ motion to dismiss, the court found that, “MERS was not required to register every assignment of the loan or to track that history in its foreclosure documents…” and “…it was not a misrepresentation for  MERS to identify itself as the mortgagee in the foreclosure documents and not to identify all past and present lenders.”

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

Posted on by

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.

Jefferson County Circuit Court Holds That Fannie Mae Had Standing to Bring Ejectment Action

Posted on by

The circuit court in Fannie Mae v. Steele, Jefferson County Circuit Court No. 09-900069 (May 18, 2011) found in favor of the plaintiff [Fannie Mae], by deciding to deny the defendants’ motion to set aside the judgment for possession. The defendants contended that the judgment in favor of Fannie Mae should be vacated on the grounds it was void due to MERS’ assignment of the mortgage to Everhome Mortgage. Everhome Mortgage was the party who conveyed the property to Fannie Mae through foreclosure deed.

The defendants also argued that Fannie Mae lacked standing to eject the defendants. This claim was premised on the holding from to Crum v. LaSalle Bank, 2009 WL 2986655 (Ala. Civ. App. Sept. 18, 2009). After considering the defendants’ contentions, the court held that the MERS assignment to Everhome was valid because MERS had the ability to assign the mortgage and take other actions as the nominee of the lender and its assigns. Likewise, the court also held that Fannie Mae had standing to bring the ejectment action.

Oregon Court Holds That Oregon’s Non-Judicial Foreclosure Statute Does Not Require Presentment of the Note

Posted on by

The court in Buckland v. Aurora Loan Services, Josephine County No. 10 CV 1023 (March 18, 2011) granted the defendant’s motion to dismiss the plaintiff’s complaint for wrongful foreclosure with prejudice.

MERS, although not being a party to the case, the plaintiff’s complaint contained claims that MERS lacked the power to appoint a trustee as it was not the beneficiary of the plaintiff’s deed of trust. The plaintiff’s complaint also alleged that Aurora was required to prove it was the note holder before directing the trustee to non-judicially foreclose. The court considered the plaintiff’s contentions, but ultimately dismissed the plaintiffs’ claims.

The court relied on the cases cited in Aurora’s motion to dismiss, including Stewart v. Mortgage Electronic Registration Systems, Inc. (holding that presentment of note not required and MERS is a valid deed of trust beneficiary). The court ultimately held that Oregon’s non-judicial foreclosure statute does not require presentment of the note.

Florida Court Dismisses Class Action Against MERS Over Unpaid Recording Fees

Posted on by

The court in Fuller v. MERS, No. 11cv-1153 (M.D. Fla., June 27, 2012) was “confronted with an old problem: the difficulty of reconciling new technology with old law, thus raising the centuries old separation of powers controversy.” In deciding this case the court found that the Florida statute, which created the recording system, was a creature of statute, as such the remedy the plaintiff sought was to be granted by the legislature and not the courts.

In reaching its decision, the court found that the statute creating Florida’s public recording system did not provide a private right of action, as such Fuller was barred from bringing common law claims based on the statute. Fuller’s claims included civil conspiracy, a Writ of Quo Warranto, unjust enrichment, as well as fraudulent and negligent misrepresentation. Fuller claimed that these claims were independent of the Florida statute, however, he admitted that the statute was the only source of his authority.

The court found that all of Fuller’s claims failed on their merits. Fuller argued that MERS attempted to usurp his function as the recorder of public instruments and sought a Writ of Quo Warranto. However, MES successfully argued that no law required payment of recording fees when a mortgage is assigned but not recorded.

Fuller failed to establish a conspiracy, as MERS did not commit an unlawful act. The court noted that the recording of mortgages is “at the complete discretion of the party wishing to record the document.” Accordingly, MERS was under no legal obligation to record the assignment or pay the recording fees. Fuller’s unjust enrichment claim was also rejected, as MERS had no duty to record, so Fuller could not establish that he had conferred any benefit on MERS. Lastly, Fuller’s fraudulent and negligent misrepresentation claims were based on the assumption that MERS falsely designated itself as the mortgagee on recorded instruments. The court rejected this assumption.

Oregon District Court Finds Claim Preclusion Bars Stop-Foreclosure Action

Posted on by

In Buckland v. MERS, Or. 11-3053-CL (2011) the court dealt with res judicata and the plaintiff relitigating the same claims that were raised or could have been raised in a previous action. The court found that the same factual transaction was at issue in the plaintiff’s prior litigation and at issue in the present case. Both actions arose out of the same non-judicial foreclosure proceeding associated with the loan on the plaintiff’s property.

The plaintiff had named Aurora Loan Services as sole defendant in his state action and MERS as a nominee for American Mortgage Network as sole defendant in the current action, although he referenced each of the parties in the complaints filed in both actions and challenged foreclosure of his property in both actions. As agents for the lender, the relationship between Aurora and MERS was close enough such that the court found the parties to be in privity. Since claim preclusion applies to a party to an earlier action and to a person who was not a party in the earlier action but who was in privity with the party to the earlier action, the plaintiff’s claim was precluded.

The court concluded that the plaintiff’s claims brought in this action, which arose out of the same factual transaction as the previous litigation, the court found that the claims could have been brought in those proceedings. Accordingly the claims were thus barred by claim preclusion.

Bank of America and MERS Motion for Dismissal Granted Against Homeowner-Plaintiff in Reconsideration of Order Denying Preliminary Injunction in Foreclosure Proceeding

Posted on by

In Harris v. Americas Wholesale Lender, No. 2011-659-CH (Macomb Cty. Cir. Ct. June 8, 2011) the court granted the defendant’s motion for dismissal of all the homeowner-plaintiff’s claims in foreclosure proceeding.

Defendants Countrywide, Bank of America, and MERS moved for summary disposition against plaintiff-homeowner under MCR 2.116(C)(7) and (C)(8). Plaintiff moved for reconsideration of the lower court’s denial for preliminary injunction and another motion for entry of default judgment.

Plaintiff alleged five counts; [1] fraud, [2] breach of contract, [3] collusion, [4] conversion, and finally [5] unjust enrichment. In assessing these claims the court found that they were all without merit.

In regards to the plaintiff’s alleged fraud claim the court dismissed it as frivolous as plaintiff could not, and had not, produced any evidence to support the allegation. Upon considering the second count, the court likewise dismissed as the plaintiff failed to show any cognizable allegation of a breach of contract.

The claim of collusion was also dismissed as the court found that the plaintiff failed to plead the claim with particularity. Accordingly, the claim of conversion was also dismissed as the plaintiff failed to explain, to the court’s satisfaction, how a claim of conversion could be supported. Finally, the claim of unjust enrichment was found to be without merit, as the court found that the plaintiff failed to show how an unjust enrichment took place.