Tag Archives: record

Tennessee Court Rejected MERS’ Argument that Sale of Property Should be Invalidated

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The court in deciding Mortgage Elec. Registration Sys. v. Ditto, 2014 Tenn. App. (Tenn. Ct. App., 2014) affirmed the judgment of the lower court.

This appeal involved the purchase of property at a tax sale. MERS filed suit against purchaser to invalidate his purchase of property because it had not received notice of the sale even though it was listed as a beneficiary or nominee on the deed of trust.

Purchaser claimed that MERS was not entitled to notice because MERS did not have an interest in the property. Purchaser also alleged that MERS failed to properly commence its lawsuit because it did not remit the proper funds pursuant to Tennessee Code Annotated section 67-5-2504(c).

The trial court refused to set aside the tax sale, holding that the applicable notice requirements were met and that the purchaser was the holder of legal title to the property. MERS appealed the lower court’s decision, however this court affirmed the decision of the lower court.

Since appellant was never given an independent interest in the property, and it did not suffer an injury by the sale of the property at issue, and the only injury suffered by appellant related to the future effect the case could have on its business model, which was not a distinct and palpable injury capable of being redressed by the court, the trial court’s grant of the purchaser’s motion for judgment on the pleadings was properly granted as appellant did not have standing to file suit to set aside the tax sale of the property for lack of notice under Tenn. Code Ann. § 67-5-2502(c) and the Due Process Clause of the Fourteenth Amendment.

The court found that the failure to tender the appropriate funds when filing the petition to set aside the sale under Tenn. Code Ann. § 67-5-2504(c) was not a prerequisite for relief.

Washington Court Dismisses Fair Debt Collection Practices Act and Washington Deed of Trust Act Violation Claims

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The court in deciding Dietz v. Quality Loan Serv. Corp., 2014 U.S. Dist. (W.D. Wash. Jan. 3, 2014) granted Wells Fargo and MERS’ motion to dismiss.

This action involved is a post-sale wrongful foreclosure case. Plaintiff Timothy Dietz alleged causes of action for violation of the Fair Debt Collection Practices Act (FDCPA)(Counts I and IV) and violation of the Washington Deed of Trust Act (DTA)(Counts II and III).

The court in deciding this case noted that Dietz’s first and fourth causes of action were for violation of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692g(b) and 1692e(5) respectively. These causes of action did not mention MERS  and there was no allegation in the complaint that MERS engaged in any activities that could be construed as a “debt collection.” As such, this court dismissed the FDCPA causes of action against MERS.

Similarly, the court found that Dietz had not alleged facts that gave rise to a violation of the debt validation notice requirements. Dietz’s claim that that Wells Fargo violated 15 U.S.C. § 1641(g) by failing to notify him within 30 days after it purchased the Loan. Wells Fargo purchased the Loan in 2008 and the assignment was recorded in 2011. The court found that under either date, the claim was barred by FDCPA‘s one year statute of limitations, 15 U.S.C. § 1640(e), as this lawsuit was not filed until 2013.