Ibanez - Appeal Supreme Court

7/28/2019 Ibanez - Appeal Supreme Court

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SUPREME JUDICIAL COURTFOR THE COMMONWEALTH OF MASSACHUSETTS

APPEALS COURTNOS. 2010-P-0123 & 2010-P-0124

U.S. BANK NATIONAL ASSOCIATION,AS TRUSTEE FOR THE STRUCTURED ASSET SECURITIES

CORPORATION MORTGAGE PASS-THROUGH CERTIFICATES, SERIES2006Z,

PLAINTIFF/APPELLANT,v.ANTONIO IBANEZ,

DEFENDANT/APPELLEE.WELLS FARGO BANK, N.A . ,

AS TRUSTEE FOR ABFC 2005-0PT 1 TRUST, ABFC ASSETBACKED CERTIFICATES SERIES 2005-0PT 1,

PLAINTIFF/APPELLANT,v.

MARK A. LARACE M'"D TAMMY L. LARACE,DEFENDANTS/APPELLEES.

ON APPEAL FROM A JUDGMENT OFTHE LAND COURT

CONSOLIDATED APPLICATION OF THE APPELLANTSFOR DIRECT APPELLATE REVIEW

R. Bruce Allensworth (BBO#015820)Phoebe S. winder (BBO#567103)Andrew C. Glass (BBO#638362)Rober t w. Sparkes , I I I (BBO#663626)K&L GATES LLPS t a t e S t r e e t Financ ia l CenterOne Linco ln S t re e tBoston, Massachuset ts 02111-2950617.261.3100 ( te lephone)Attorneys for Appellants


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i f f s s , u.s. NatAs s Asse ton , as Trus tee

Corpora t ion Pass-ThroughC e r t i f

Wellses 2006-Z ("U.S. Bank, as Trus tee" )

, N.A. , as Trus teeOPTI Trus t , ABFC Asset C e r t i f i c a t e s2005 ( "WeI Fargo, as Trus tee" )

Cour tc a p t i

1an ts" ) ,t

ly r eq u es treview of

to Mass. Gen. L. 10(a) Mass. R. App. P. 11.1

presen tCour tq u es t

l osu re law t h a tI i

thenew I t ha t

ceo f

, th e orders c a l la ' s t

which

serves to

ques t ion th eh er

- 2

ABFC 2005

th e

. 21

i s

.J . . ,ULlJo, , - t on

ofa

a


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fo rec losure sa le has occurred a t any t ime in thehis tory of th e proper ty ' s conveyance.

Accordingly, these appeals presen t novel l eg a lissues of such publ ic i n t e r e s t t h a t j u s t i ce requ i re s af i na l dete rmina t ion by t h i s Court . The Court ,the re fo re , should grant Appe l lants ' app l ica t ion fo rd i r e c t appe l la te review.I . STATEMENT OF RELEVANT FACTS

The appeals concern forec losures on tw oproper t i e s tha t secured loans as to which th eborrowers , Defendants /Appel lees here , defaul ted .

A. The Larace Mortgage LoanOn o r about May 19, 2005, Defendants /Appel lees

Mark A. Larace and Tammy L. Larace ( the "Laraces")obta ined an ad jus tab le ra te mortgage loan in theamount of $129,000.00 from Option One MortgageCorporat ion ("Option One"). The note wa s secured byr e a l prope r ty loca ted a t 6 Brookburn S t re e t inSpr ingf ie ld , Massachuse t t s .

Subsequent ly , th e Larace mortgage loan was pooledwith othe r loans and placed ln a s e c ur i t i z a t i on t r u s tfo r which Wells Fargo ac ted as t r u s t e e . The Pool ingand Servic ing Agreement ("Larace PSA") ass igned a l li n t e r e s t in the Larace note and mortgage to Wells

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Fargo ac t ing in i t s capac i ty as t r u s t e e fo r th es e c ur i t i z a t i on t r u s t . S p ec i f i c a l l y , the PSA provided:

The Depos i to r [Asset Backed Funding Corporat ion) ,concur ren t ly wi th the execut ion and del ivery [ofthe Pool ing and Servic ing Agreement) , does herebyt rans fe r , ass ign , s e t over and otherwise conveyto the Trus tee [Welis Fargo], wi thout recoursefo r the b e n e f i t of the Ce r t i f i c a t e holders a l lth e r i g h t , title and i n t e r e s t of the Depos i to r ,inc lud ing any secur i ty i n t e re s t the re in inand to. . each mortgage loan i de n t i f i e d [bythe Agreement] .

Larace PSA a t Art . I I , 2.01 (emphasis added) .Pursuant to th e Larace PSA, Wells Fargo, as

Trus tee had possess ion , a t a l l r e levan t t imes , o f theo r i g i n a l Larace note (endorsed in blank) , the or ig ina lLarace mortgage, and an assignment of mortgage inblank. 2

On or before Apr i l 2007, th e Laraces de fau l t ed ont h e i r mortgage loan. Therea f t e r , in Apri l 2007, WellsFargo, as Trustee commenced forec losure proceed ings onthe mortgaged prope r ty . Pursuant to Mass. Gen. L. ch .244, 14, a "Not ice of Mortgagee 's Sale o f RealEsta te" was publ i shed in The Boston Globe on the

r e qu i s i t e number of occas ions . Wells Fargo, asTrus tee s e n t s imi l a r no t ices to the Laraces and a l l

2 An assignment of mortgage inwhich th e assignment i s completedof the ass ignee i s l e f t blank.

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blank i s one inexcept t ha t th e name


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ie s an tThe I s , as Trus tee as

sOn

a t auc t

osure .5, 2007,

to Wells , as Trus teeof $120,397.03.

was sthe amount

The Laraces never con tes th e no t iceor any ofNo othe r ever came

a t t ime or a t any s ,tocon te s t I s , as Trus tee ' s t in note

On o r 7, 2008, on One executed armatory ass ignment of Larace t mortgage

from i t s e l f to I s , as Trus tee , e f asof Apri l 18, 2007, a e to the i s suance of

the losureass was th Hampden

of on May 12, 2008. On 15, 2008,losure were

ofB.

On o r about December 1, 2005, /Appel11 ) an us r a t e

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mortgage loan in th e amount of $103,500.00 from RoseMortgage, Inc . The note was secu red by a mortgage onr e a l prope r ty l o ca t ed a t 20 Crosby S t re e t inSpr ingf i e ld , Massachuset ts . Rose Mortgage, Inc . thenass igned the note and mortgage to Option One.

Subsequent ly , th e Ibanez mortgage loan was pooledwith othe r loans and placed in a se c u r i t i z a t i o n t r u s tfo r which U.S. Bank ac ted as t r u s t e e . The Priva teplacement Memorandum ("Ibanez PPM") evidences anass ignment of a l l i n t e r e s t in th e Ibanez note andmortgage to U.S. Bank ac t ing in i t s capac i ty ast r u s t e e fo r th e se c u r i t i z a t i o n t r u s t . Spec i f i ca l ly ,the Ibanez PPM prov ided :

The Mortgage Loans w i l l be ass igned by Deposi torto the Trus tee . Each t r a n s fe r of aMortgage Loan from the S e l l e r to the Depos i to rand from the Depos i to r to the Trus tee w i l l bein tended to be a sa le of t h a t Mortgage Loan andw i l l be r e f l e c t e d as such in th e Sale andAssignment Agreement and the Trus t Agreement .. With re spec t to c e r t a i n Serv ice rs , it i sexpected t h a t th e mortgages o r ass ignments ofmortgage with re spec t to each Mortgage Loan w i l lhave been recorded in th e name o f an agent onb eh a l f o f th e holder o f the r e l a t e d mortgagenote . In t h a t case , no mortgage ass ignment infavor o f the Trus tee w i l l be requi red to beprepared , de l ive red o r recorded . Ins tead , theServ ice r w i l l be requi red to t ake a l l ac t ions asa re n eces sa ry to cause the Trus tee to be shown asth e owner of th e r e l a t e d Mortgage Loan on ther eco rd s o f the agent fo r purposes o f th e systemof record ing t r an s f e r s o f b e n e f i c i a l ownership ofmortgages maintained by th e ag en t .

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Ibanez PPM a t 119pursuant to

, as Trus teet

i sspossess

} ., u.s.

I a tnote ( in

) , mortgage, ana s s i

On or

"Notice o fpub l iof occasno to

t in

1 2007, on h ist e r , U.S. , as Trus tee

losure onPursuant to Mass. Gen. L. . 244, 14, a

' s e Esta te" wasBoston obe on s i t e

U.S. Bank, as Trus tee sen t s1 i e s holding an

l i s u.s., as Trus tee as the fOn mor proper ty was

a t auc t5, 20

to U.S. as Trus tee fo r the amount of$94,350.00.

never contes ted of osureor t Nopar ty ever came a t

o r a t any t ime s , to con te s t U.SBank, as Trus tee ' s t note

7


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On May 23, 2008, the forec losure deed and re la teddocuments were recorded with the Hampden CountyRegis t ry of Deeds. On o r about September 2, 2008,American Home Mortgage Serv ic ing , Inc. ("AHMSI")executed a conf i rmatory assignment of the Ibanezmortgage to U.S. Bank, as Trus tee . That conf i rmatoryassignment was recorded with the Hampden CountyRegis t ry of Deeds on September 11, 2008.I I . STATEMENT OF PRIOR PROCEEDINGS 3

A. Appel lants ' Land Court Actions And TheBorrowers' Default

Well a f t e r the fo rec losure sa les a t i s sue here , aques t ion arose within th e title insurance i ndus t ry inMassachuset ts as to whether th e use of The BostonGlobe fo r pUbl icat ion of forec losure not ices withre spec t to r e a l prope r ty loca ted in Spr ingf i e ld ,Massachuset ts , s a t i s f i e d the no t ice provis ion of Mass.Gen. L. ch. 244, 14.4

To resolve t h i s ques t ion with respec t to thesub jec t p roper t i e s , in the f a l l of 2008, Appel lan ts

3 Pursuant to Mass. R. App. P. 11(b) , c e r t i f i e dcopies of the Land Cour t docket shee ts a re a t tachedhere to a t Tabs 1 and 2 of the Addendum.4 While The Boston Globe i s i n c i r c u l a t i o n inSpr ingf i e ld , The Springf ie ld Republican has a widerc i r c u l a t i o n i n t h a t a rea .

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f i l a i n t s Land Court , eachseek ing a 'so r mortgagors ' r i g h t s , t t th e

were ex t shed a t forec losure s a l e ,(2 ) no c l s ted on tit to , and( 3 ) title to fees imple . one i s sue

, whether The Boston Globe was a ofc on in th e area

es of s a t i s no t ice io n of Mass.Gen. L. ch. 244, 14.

Al ce of process ,t h e r to complaints ,

l an t s fo r o f f a u l t j t

l ees .Because the Ibanez Larace ons ra i sed

same I i s sue surrounding adequacypubl on The Boston Globe, Land Court

i da t ed ac t p r e -5 Sua Cour t a new

5 Land Cour t a lsoth a

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i s sue n o t pre sen ted compla int ac t ion .f i Land Court quer ied

Appel lan ts were l e g a l " /I th e respeca t

fo re , n o t i c e s eie d th Mass. Gen. L. . 2 , 14. 6

Cour t reques e f on s i s sue ,

fo r

6

7

l a n t s connec on wi r mott j t l e e s .

B. IOn March 26, 2009,

andt

Court, compl

on o f th e e c t

Order ont Judgment.

A copy of Mass. Gen. L.a t 7 th e

A copy of the Cour t ' sf f s ' Motions

26, 2009

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Cour t i s sued aof

(" Ibanez 11).7

the ques

n o t i c e s in

, Motions

244,

3


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Boston Globe s f i rements Mass. Gen.L. 244, 14. Land Court ,to f ( 1 ) n e i v a la s s i t ime i c a t of

no t ices o r a t the t of th e e ,(2 ) th e l osu re no t i ce s 1

\\ II th e (3 )ces were 1 e n t Mass. Gen. L.

244, Put way! th e Courts to

a t i s sue .As a Cour t n o t

mot t j sua, found

s 'wi f i l e d

jc.

On

v aca t e J

, b u t t a n t i a l

I I

14, 2009,Order denying

s l a r , motions to vaca te

Cour t il a n t s f

ato

f i rming its p r J

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( "Ibanez I I" ) . 8 Notwi th s t and ing Appel lan t s ' evidencet h a t a t the t ime of th e fo rec losure s , Appel lan tspossessed the re spec t ive o r i g i n a l notes (endorsed inblank) , the o r ig in a l mortgages , th e assignments ofmortgage in blank, and s e c ur i t i z a t i on documentsass igning a l l i n t e r e s t s in the re spec t ive notes andmortgages to Appel lan ts , th e Land Cour t found t h a tAppel lan ts were no t th e "ho lders" of the re spec t ivemortgages. The Land Cour t held t h a t al though anassignment of mortgage need no t be recorded, an e n t i t ybecomes the "holder" of a mortgage fo r the purposes ofsa t i s fy i n g the no t ice requirements o f Mass. Gen. L.ch . 244, 14, only where the ass ignment i s " inrecordab le form" and express ly i de n t i f i e s t h a t e n t i t yas the ass ignee .

On October 30, 2009, both U.S. Bank, as Trus teeand Wells Fargo, as Trus tee f i l e d Notices of Appealfrom the Land Cour t ' s tw o memoranda and orders and th eLand Cour t ' s u l t ima te judgment a g a i n s t both e n t i t i e s . 9

8 A copy of the Land Cour t ' s Memorandum and Orderon P l a i n t i f f s ' Motions to Vacate Judgments datedOctober 14, 2009 (Ibanez I I ) i s a t tached here to a t Tab4 to the Addendum.9 U.S. Bank, as Tr u s t ee ' s Notice of Appeal i sa t tached here to a t Tab 5 to th e Addendum. Wells Fargo,as Trus tee ' s Notice o f Appeal i s a t tached here to a tTab 6 to the Addendum.

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I I I . LAW PRESENTED FOR APPEAL

11A.

B.

primary i s sues of t h a t th ee on

power1 .

2.

3 .

4 .

5.

a re as lows:

Cour t e r red ru lass of

n ot a c t to ass

a ssand thus d id n ot

on to

then o t i ce

Gen. L. ch . 244,

anythe record ;

Cour t ' s

Cour t e r red inof a

e re ;

d idLarace

of Mass.erroneous i

in g

no t r a t i f y

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C. Whether th e Land Court er red by no t l imi t ingi t s ru l ings to p rospec t ive app l ica t ion only ,where it fa i l ed to take in to cons ide ra t ionTi t l e Standard No. 58 of the Real Es ta te BarAssocia t ion fo r Massachuset ts and the fa r -reaching consequences of the r e t ro a c t i v eapp l ica t ion of th e Land Cour t ' s ru l ing onnumerous t i t l e s to r e a l prope r ty inMassachuset ts ; and

D. Whether the Land Court abused i t s d i sc re t ionby en te r ing judgment sua sponte aga ins tAppel lan t s .

Pursuant to Rule 11(b) (4) of the Massachuset tsRules of Appel la te Procedure , Appel lant s ce r t i fy t h a tthey have ra i sed and preserved the i s sues l i s t e d abovein the Land Court .IV. ARGUMENT.

Appel lants had s tanding to invoke th e s ta tu torypower of sa le and to provide no t ice under Mass . Gen.L. ch. 244, 14, because they were holders of thenotes and possessors of th e or ig ina l mortgages,possessors of assignments of mortgage in blank, andass ignees pursuan t to the terms of the s e c ur i t i z a t i ondocuments. These documents, taken alone and toge ther ,acted to ass ign the mortgages, and thereby conveyedau thor i ty to foreclose . Nei ther the Land Cour t ' shyper technica l i n t e rp r e t a t i on of Mass. Gen. L. ch.244, 14, nor i t s improper crea t ion of hypothe t i ca lpre jud ice should be permi t ted to a l t e r t ha t au thor i ty .

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Moreover, a f t e r th e forec losure s a l e s , Appel lantsrecorded conf i rmatory assignments - a long-s tand ingp ra c t i c e in Massachuse t t s t h a t comports with the RealEs ta te Bar Assoc ia t ion ' s T i t l e Standard No. 58 andt h a t r a t i f i e d Appel lan t s ' ownership i n t e r e s t s in th esub jec t loans .

The Land Cour t ' s erroneous ru l ings have c rea t ed ase r ious cloud on proper ty t i t l e s throughoutMassachuset ts and on forec losure procedures as awhole, and they should not s tand.

A. Appellants Had Standing To IIlvoke Th eStatutory Power Of Sale And Issue NoticeUnder Mass. Gen. L. ch. 244, 141. The Land court Erred In Ruling That The

Assignments Of Mortgage In Blank DidNot Assign The Mortgages to Appel lants

The Land Court held t h a t Appel lan t s ' assignmentsin blank were i n e f f e c t i v e to ass ign th e mortgagesbecause " [o]ne can become t he ' ho lde r of the mortgage '

. only by a wri t ing sa t i s fy i n g the s t a t u t e off rauds . in recordable form." Ibanez I , Tab 3 toAddendum, a t 11 n.19.

Massachuset ts Law, however, does not requ i re ap a r ty to possess an assignment in recordab le form as ap re re q u i s i t e to th e exerc ise of th e power of s a l e .Ins t ead , the s t a t u t e governing forec losure no t i ce s ,

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Mass. Gen. L. ch. 244, 14, II [ t ]heII o r

may " 1

"ass

Simi

ac t s au thor is t a t u t ein to

power maydoes not

power of sa le"o r by

power of sa le ,Larace

by anan ass

to so . Mass. Gen. L. . 183, 21., while s t a tu t e , Mass.

Gen. L. ch. 183, 6C, s t a t e s tothe name ofan ass should

ass , it o s t a t e s t h a t II [ f ] a i l u r e to complys 1 not the i ty

of ass of a mortgage. It s t a tu t e ,an ass may possess a

ass o f mortgage even i ft h a t document n ot in

Moreover, Cour t ' sthe ass wi Sta tu te

an ass be IIs th e par to

some person him l awful ly" Mass. Gen. L. 259, 1 (4) .

Court in upon ssey,

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327 Mass. 217 (1951) and Macurda v . Ful le r , 225 Mass.341 (1916), fo r the pos i t ion tha t a deed in fee s implei s i nva l id i f it i s executed with the gran tee ' s namel e f t blank. Both cases involved r e a l e s t a t e deedsconveyed through ove r t ac t s of f raud. There i s nosuggest ion of f raud here . In any event , a deedremains v a l i d i f " a l t e r a t i ons a re made by th eg ra n t o r ' s d i rec t ion" or " the f i l l i n g of the blanks i snot mate r i a l t o the va l i d i t y of the ins t rument anddoes not a l t e r i t s l eg a l t enor and e f f e c t . " Eno &Hovey, 28 Massachuset ts Prac t ice 4.50 (4 th ed. 2008);phelps v. Sul l ivan, 140 Mass. 36, 37 (1885) (assignmentof mortgage va l id where gran to r executed assignment inblank and ora l ly author ized son to fill in th e name ofpurchaser , once found, as gran tee ) . Both cond i t ionsa re t rue here , and nothing in th e law requ i re s anassignment i den t i fy the ass ignee by name to be va l id .

2 . The Land Court Erred In Ruling That TheSecur i t i za t ion Agreements Did NotAssign The Mortgages to Appel lants

The provis ions contained in th e Larace PSA andthe Ibanez PPM (see supra) themselves a c t to ass ignthe mortgages to Appel lants , and a t l e a s t one cour tapplying Massachuset ts law has found as much. In reSamuels, 415 B.R. 8, 18 (Bankr. D. Mass. 2009) ("The

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[Pooling and Serv ic ing Agreement] i t s e l f . . servedas a wri t t en assignment of the des igna ted mortgageloans , inc lud ing the mortgages themse lves ." ) . Th eLarace PSA and the Ibanez PPM sa t i s fy the Land Cour t ' sown erroneous requirements fo r a va l id assignment.Among other th ings , these documents i den t i fyAppellants as ass ignees and con ta in language ofconveyance d i r ec t ed express ly to the mortgages t h a tcomprise the s e c ur i t i z a t i on t r u s t s . These documentsass ign and convey th e mortgages from th e ass ignors toAppel lan ts and, thus , conferred th e au th o r i t y toexe rc i se the power of sa l e under those mortgages. SeeLamson & Co. v. Abrams, 30 5 Mass. 238, 244 (1940) ("Thei n t e r e s t of anyone in an ex i s t ing mortgage . i snot confined to the record t i t l e . " ) .

3 . The Land Court Erred In Ruling ThatAppellants' Possession Of The OriginalLoan Documents Did Not ProvideAuthority To Invoke The Power Of Sale

Courts have found t h a t the exerc ise of th e powerof sa le i s n o t l im i t ed to the mortgage holder ; it maybe exerc ised by those possess ing othe r " su f f i c i e n tf inanc ia l i n t e r e s t [ s ] . " Saffran v. Novastar Mort . ,Inc . , No. 4:07-cv-40257-PBS, Order re : EmergencyMotion fo r Stay Pending Appeal a t 5-6 (D. Mass. Oct.

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18, 2007); 10 see : . . . . . . . = . . - = - = - = - ~ ~ - = - - - = - - - = - - - = - - _ - ' = - - . , 13 9 F. 3 d 59,62 ( Cir . 1998) lose foundloan "c l t ha t fr e t a i n au thor i ty to elf) .

At losure not 1poss " f i f

til the tw o to exercpower of he ldnote , provided wi an e

t thein

mortgage and thety an assignment of t ha t

toSee

t Nat ' l Bank of Hoosac~ S = a v ~ . - = - = ~ , 7 Mass. App. C t. 790, 796 (1979).

l an t s a l so possessedor ig ina l a s s i of

, coupled tht r a t e

ves te .

10 A8

lnNo

l an t s author ipar ty come

s ' ownership or to

- 19

andin blank. eti on

th e andto invoke power

to chal lengea t

possess 1 of

i s a t


20/107

i nd ic i a of ownership of the mortgages, and the LandCourt er red in ru l ing otherwise .

4 . The Land Court's Interpretation Of TheNotice Requirements Of Mass. Gen. L.Ch. 244, 14, Was Erroneous

Contrary to the Land Cour t ' s ru l ings , where afo rec losure sa le i s conducted with reasonab ledi l igence and per formed in a commercial ly reasonab lemanner, withou t evidence of fraud, misconduct , o rpre jud ice , the re i s no reason to i n v a l i d a t e th e sa l e .See Sta tes Res. Corp. v. The Arch i t ec tu ra l Team, In c . ,433 F.3d 73, 81 (1 s t Cir . 2005) . The proper focus whencons ider ing the no t ice requirements of Mass. Gen. L.Ch. 244, 14, i s on whether th e no t ice provided th emortgagor with s u f f i c i e n t informat ion to p r o t ec t her

i n t e r e s t s and whether any e r ro r ac tua l ly pre judicedth e mortgagor ' s r i gh t s . Severa l recen t cour tdec i s ions have i n t e rp re ted th e requirements ofSect ion 14, and th e s imi l a r provis ions of Mass. Gen.L. ch. 244, 17B, in accordance with thesep r i n c i p l e s . See Fed. Deposi t Ins . Corp. v. Kefa las ,62 Mass. App. Ct. 1121, a t *1 (2005) (unpubl isheddi spos i t i on) ("we f a i l to see why the change in namewas s ign i f i c a n t ; " " [ t Jhe de fendan t ' s as s e r t i o n t h a tthe d i f fe rence in name may have pre judiced th e outcome

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of the sa l e i s e n t i r e ly specu la t ive" ) ; Tarvezian v .Debral Real ty , No. 921437, 1996 WL 1249891, a t *4(Mass. Super . C t. Sept . 27, 1996) ("This cour t w i l l n otread the s t a t u t e in . . a fo rmal i s t i c ,hypertechnica1 manner, b ut r a t h e r w i l l const rue it lni t s pra c t i c a l app l ica t ion , purpose and e f fec t . " ) .1 1

Here, the record con ta ins no ind ica t ion t h a te i the r mortgagor su f fe red pre jud ice as a r e s u l t of th epub l i shed no t ices . The no t ices i de n t i f i e d th e p a r tyseek ing to exe rc i se th e power of sa l e , the holder ofan assignment of mortgage in blank, the ass ignee underth e s e c u r i t i z a t i on documents, and the ho lde r of th eunder ly ing note . Nothing in th e f ac tua l recordsugges ts t h a t th e manner in which Appel lants werenamed in the publ ished no t i ce s had any impact on th et r ansac t ions or th e accep ted b ids , o r caused harm toth e de fau l t ed mortgagors . 12 The Land Cour t ' s

11 See a lso Nichols , 139 F.3d a t 61-62("[ t ]he t r u s thas not shown any re spec t in which it has beendisadvantaged by having Cadle, ra the r than Foo th i l l ,give no t ice and conduct th e fo rec losure" ) ; Bank of NewYork v. Apol los , No. 08-ADMS-10045, 2009 WL 1111198,a t *1-2 (Mass. App. Div. Feb. 27, 2009) (upholdingno t ice where " [ t Jhere i s no sugges t ion t ha t the sa l ewas conducted in a commercial ly unreasonable manner") .12 In add i t i on , Appel lees had no t i ce of the i de n t i t yof th e se rv ice r s of t h e i r mortgage loans under th eReal Es ta te Set t lement Procedures Act, 12 U.S.C.

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specu la t ion to the con t ra ry i s not s u f f i c i e n t towarrant the voiding of th e tw o forec losure sa l e s .

In s t r i c t l y cons t ru ing Mass. Gen. L. c . 244, 14, the Land Court r e l i ed heavi ly on Roche v.Farnsworth , 106 Mass. 509 (1871) and Bottomly v.Kabachnick, 13 Mass. App. C t. 48 0 (1982) . This wase r ro r . In Roche, th e no t ice l i s t e d only th e or ig ina lmortgagor and mortgagee, n e i t h e r of which mainta inedan i n t e r e s t in the prope r ty . This Cour t he ld t h a t theno t ice should list what i s being sold , who i s doingth e se l l i n g , and who i s adver t i s ing th e forec losuresa l e . See Roche, 106 Mass. a t 513. The Appeals Courtin Bottomly s t r e t ch ed Roche by f ind ing a no t ice , whichdid n ot name the holder or the par ty conduct ing th eforec losure sa le , defec t ive "because it fa i l ed toi d e n t i fy th e ho lder of th e mortgage." Bottomly, 13Mass. App. C t. a t 483-84. While th e word choice inBottomly suggests a b r i g h t - l i n e ru le , i t s fac t si n d i ca t e a s imple r holding - t h a t the no t ice mustident i fy the par ty purpor t ing to exe rc i se th e power ofsa le and to i s sue n o t i ce . The no t ices i ssued in

2605(e) , and had access to in format ion concerningth e holders o f t he i r notes and mortgages under th eTruth in Lending Act, 15 U.S.C. 1641(f) (2) .

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connect with Ibanez Laraces a t i s f i s , and Cour t ' s

s e r ro r . 13

B.

The Land Courta s s i n o t a c t to fy ass

as between ass ignorsAppel An ass t h a t in e

and a f t e r forec e i s acon assignment, which es of

t in th e and i t snote and s za t ion

See . v. Trus tees o f Boston. , 425 Mass. I , 18..::....;;..=-=- 997) ; In re , 20==--==-:::..-=--:.:;;:.:.=-=-=- WL

2 2121, a t *11; In re 41 7 B.R. 0, 148 50- - - - - - - -(Bankr. D. Mass. 2009).

This i s co n s i s t en t th l o n g - s , - , - , - , u , " , , " , ~ indusce in e t t s , as s e t fo r th REBA Ti t l e

Standard No. 58:13 To the ex ten t t h a t Court ied upon

e no t ice appended to Mass. Gen. L. ch. 244, 14, f ind ing t h a t

t s use

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A title i s not de fec t ive by reason o f:[ t ]he r eco rd in g o f an Assignment of Mortgageexecuted e i the r p r i o r , o r subsequent , tofo rec l o s u re where s a id Mortgage has beenfo rec losed , of record by the Assignee .

REBA T i t l e Standard No. 58, i n f r a . The conf i rmatoryassignments executed and recorded a f t e r th e s a l e sconfirm Appel lan t s ' ownership i n t e r e s t s in th ere spec t ive loans and r a t i f y a l l ac t ions taken byAppel lan ts in fu r therance of fo rec losure . The LandCour t ' s ru l ings to the con t ra ry were p l a i n e r r o r .

C. The Land Court's Holdings, I f Affirmed, MustBe Limited To Prospect ive Appl icat ion

Even if t h i s Cour t adopts the Land Cour t ' si n t e rp re t a t i o n of Mass. Gen. L. ch. 244, 14, t h a ti n t e rp re t a t i o n cannot be ap p l i ed r e t ro a c t i v e l y tot r ansac t ions t h a t occurred before t h i s Cour t ' sd ispos i t ion of the i s sue . - In th e a rea of proper tylaw, the r e t ro a c t i v e inva l ida t ion of an es tab l i shedpr inc ip le i s to be under taken with grea t c au t ion . "Powers v . Wilkinson, 399 Mass. 650, 662-63 (1987).Thus, j u d i c i a l changes to es tab l i shed proper ty law a ret y p i ca l l y given only prospec t ive e f f e c t . Id . ; Charronv . Amaral, 451 Mass. 767, 772-73 (2008); Turner v.Greenaway, 391 Mass. 1002, 1003 (1984) . The p ra c t i c eof execu t ing and record ing conf i rmatory assignments of

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mortgage on a pos t - fo rec losure bas i s i s an es tab l i shedp ra c t i c e (see REBA T i t l e Standard No. 58, i n f ra ) andwas so a t th e t ime of th e fo rec losure sa les a t i s sueh e re . The fa r - reaching consequences of th e LandC o u r t ' s dec is ions , as exp la ined below, mandate t h a ti t s nove l ru l ings ( i f aff i rmed) should only applyprospec t ive ly .V. STATEMENT OF REASONS WHY DIRECT APPELLATE REVIEW

IS APPROPRIATE IN THE PRESENT CASES

Pursuant to Mass. R. App. P. 11(a) and Mass. Gen.L. ch. 211A, 10(a) , the Court may gran t anapp l ica t ion fo r d i r e c t ap p e l l a t e review where:

[T]he ques t ions presented by th e appeal a re : (1)ques t ions of f i r s t impress ion o r novel ques t ionsof law which should be submi t ted fo r f i n a ldete rmina t ion to the Supreme Ju d i c i a l Court ; (2)ques t ions of law concerning th e Cons t i tu t ion ofth e Commonwealth or ques t ions concerning th eCons t i tu t ion of the uni t ed S ta t e s which have beenra i sed in a co u r t of th e Commonwealth; o r (3 )ques t ions of such publ i c i n t e r e s t t h a t j u s t i c erequ i re s a f i n a l dete rmina t ion by th e f u l lSupreme Ju d i c i a l Court .

Mass. R. App. P. 1 1 (a ) ; see a lso Mass. Gen. L. ch.211A, 10 (a) .

Direc t appe l la te review i s warran ted here becauseth e i s sues r a i s ed by the appeals d i r e c t ly andsu b s t a n t i a l l y a f f e c t Massachuset ts fo rec losure law,r a i s e ques t ions of s i g n i f i c a n t publ i c i n t e r e s t , and

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impl ica te th e v a l i d i t y of thousands of forec losuresa les in th e Commonwealth and the t i t l e s confer red asa r e s u l t of th e same. The presen t appeals ,add i t iona l ly , r a i s e nove l quest ions of law. The LandCour t ' s dec is ion has ushered in an e n t i r e ly new l eg a lregime, crea t ing se r ious uncer ta in ty throughout thefo rec losure and title i ndus t r i e s in Massachuset ts .Accordingly , the Ibanez and Larace appeals are wel l -su i t ed and, in fac t , c a l l o u t fo r d i r e c t appe l la tereview by th e Supreme Ju d i c i a l Court .

The Land Court ' s dec is ions In Ibanez I and IbanezI I arguably a f f e c t thousands of proper t i e s purchasedin good f a i t h a t fo rec losure s a l e s in Massachuset t s -inc luding purchases t h a t occurred long before the Land

Court i ssued i t s ru l ings . Foreclosed-upon borrowersa re now at tempt ing to use these ru l ings to c a s t doubton th e title to p r o p e r t i e s t h a t had a forec losure a tany po in t in t he i r chain of sa le , even if th efo rec losure occurred years ago and th e proper ty hass ince been so ld mUlt ip le t imes. Applying the LandCour t ' s reasoning, fo rec losure s a l e s conductedpursuan t to what it def ines as i nva l id assignments a revoid , and th e proper ty owners may not ac tua l ly own th ep r o p e r t i e s they purchased in good fa i th . The Land

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Cour t ' s a on the t i t l e s ofI such these

ie s e .Land Cour t ' s i s ions a l so

to Ie up ("REO" )of v ar loan s and t

many i e s , many l e s s a f f l u e n tt i e s , vacan t and e . As th e e f of

Boston Ci ty Housing Author i I Evelynr ecen t ly Cour t ' s i s haveII , s to c lean up areas

ch] upt our t a l i z

most devas ff 14, th e Land Cour t it even more

f f i c u l t to s 1 homes c a s t doubton proper tywho ed

I t s

14

t i e s / ( a copyAddendum} .

t h e i rions

sed in

s tun ted l i t y to

- 27 -


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t r ans fe r i n t e r e s t s throughoutMass e t t s , i n f l i harship on an

c ans ing hous market.

t iona l Land Court f i rmats indus

execut conf ie form te r s s

has in common use in Mas t s s incethe 1990s, it i s

t I e No. 58, tha t :

See REBA Ti e S No. 58, in Eno &Massachuset ts Prac t Law REBA~ ~ ~ ~ ~ - - ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~No. 58 (4 th . 2008).

cea t l ea s tREBA

whereby

t . S

acknowl the , pos t -15tonotthe

In May 2008, REBA s Ti t l e Standard No. 58: \\ However, i for s ta ted to ef fec pr io r i toof a losure , then a19 1 2007 mayCourt. II REBA

caveat does notthe s a

- 28


29/107

losure ass as applREBA Ti S 58

The

t ru s t .v a lto

a decreeof the note IderI t fu r the r se rvesa c t

Id . , cmts. (c i t a t ions t ted) .Whi REBA Ti e S

s re f t ry

to note

to Endorsee,t ing Trust

assignment of it.te rmortgageof

as an esby

are not law,, a re re I upon

by indus pra c t i t i one r s , are based on Massachusettslaw, and a re c i t cour ts as persuas ive

See In re 393 B 259, 267 8

(Bankr. D. Mass. 2008); In re Varr i , 354 B.R.563, 571 (Bankr. D. Mass. 2006); Drowne v. Balerna, 65Mass. C t. 1115, a t *3 (Feb. 1, 2006) i shed

( re ly ing on REBA title s ) .Land Cour t ' s dec is Ibanez I

Ibanez I I ec t ce ofi rmatory, t - ass in

do so, have l e f t a s ign i cant rwake.

s to r i ca l been, a obj The

29


30/107

Land Cour t ' s s cec on i t s Direc t

wi l l r eso lve widethe

244 and 183.As

i s sues presnovel

t

sno mat te r theon

on of Mass. Gen. L.

s e t

on of s d i fyears case law,

res

involves t a t u t e s ,

long-on of which,

11 a s ign i f i c an t te t t s

e i s suesof s ta te law, necess i ta t

ia l Court . Court ,gran tReview.

l an t s '

Vi CONCLUSiONFor the

as Trus tee , and WeIreques t the

i

i c a t

reasons ,, as Trustee,

Courtt l a t e ew.

- 30 -

, should

u.s.t f u l

s


31/107

16, 2010

t ly submit ted ,U.S. BANK NATIONAL ASSOCIATION, asTRUSTEE FOR THE STRUCTURED ASSETSECURITIES CORPORATION PASS-THROUGHCERTIFICATES, SERIES 2006 Z,WELLS FARGO BANK, N.A., as TRUSTEEFOR ABFC 2006 TRUST, ABFCASSET-BACKED , SERIES2005-0PT1,

567103)Andrew C. Glass (BBO#63 62)

W. , I I I (BBO#663626)K&L GATES LLPSta te S t r ee t F.J..HcuJ.I..- CenterOne Linco ln S t ree tBoston , Mas e t t s 02111-2950617.261.3100 ( )6 . 261.3175 (

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CERTIFICATE SERVICE

I ce r t i on 16 th, 2010, I served two copies of

fo r Appel Review, f tthe fo l counsel of

For Ibanez:Paul R. 1 , I I I , Esq.

12 Floor

s tan St r ee tPlain , MA 02130

e Lawrence, Esq.

ces Center of

Greater Boston Services197 S t.Boston, MA 02114

day ofAppl

s I ,

Law

l ees Mark A. L. Laraceenn F. Russ 1, J r . , Esq.

At a t Law38

, MAte #

02720

- 32

on


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ADDENDUM TOAPPELLANTS' CONSOLIDATED APPLICATION

FOR DIRECT APPELLATE REVIEW

-33-


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TAB 1 :

TAB 2 :

TAB 3 :

TAB 4 :

TAB 5 :

TAB 6 :

TAB 7 :

TAB 8 :

TAB 9:

iNationalCase No.

f i(KCL)

WeIBank, N.A., as Trustee v. Larace, Case No.08 MISC 386755 (KCL)

on, Motion fo r of Defaul tMarch 26, 2009

Court ' s Memorandum Order onf f s ' to Vacate Judgment edOctober 14, 2009f f , U.S.as Trustee l s l

NationaloffC Fargo , N. A., as

Trus tee ' s , Notice ofMass. Gen. L. 244, 14

osuresOctober15, 2009

V. t a r Mort.cv-40257-PBS, Order re : Motion fo rStay Appeal (D. Mass. Oct. 18, 2007)

-34


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CRTR2709CR COMMONWEALTH OF MASSACHUSETTSLAND COURT DEPARTMENT

Docket Report08 MiSe 384283

U.S.Bank National Association, as v. Ibanez, Antonio et al LONG

CASE TYPE: MiscellaneousACTION CODE: COTDESCRIPTION: COT - Remove Cloud on Title , G.L.CASE TRACK:CASE SESSION: Courtroom 6

[ LINKED CASE:

PARTIES

~ r i n t e d 01/08/2010 11 :08 am Case No : 08 MISC 384283

FILE DATE:CASE STATUS:STATUS DATE:CASE JUDGE:

09/16/2008Closed03/26/2009Long, Keith C

Page: 1


36/107

CRTR2709-CR COMMONWEALTH OF MASSACHUSETTSLAND COURT DEPARTMENT

Docket Report08 Mise 384283

U.S_Bank National Association, as v. Ibanez, Antonio et al

Plaintiff: U.S.Bank National Association. as Trustee fo

Defendant: Antonio Ibanez (heirs, etc)

[printed: 01/08/2010 11 :08 am Case No: 08 MISC 384283

Private CounselRobert Bruce AllensworthK&L Gates LLPK&L Gates LLPState Street Financial CenterOne Lincoln StreetBoston. MA 02111-2950Work Phone (617)261 -3119Work Phone (617)261-3100Added Date: 12/07/2009Private CounselWalter Harley ParrAbl itt Law Offices , P.C.Ablitt Law Offices, P.C.304 Cambridge RoadWoburn. MA 01801Work Phone (781 )246-8995Work Phone (781 )569-6025Work Phone (781 )246-8995Work Phone (617)953-3420Work Phone (781 )286-8166Work Phone (617)961-3465Added Date: 09/16/2008Private CounselColeen HayesAblitt Law Office. PCAblitt Law Office, PC304 Cambridge Street5th FloorWoburn, MA 01801Work Phone (781 )246-8995Work Phone (978)664-820 1Work Phone (000)000-0000Added Date: 09/16/2008Private CounselRobert W. SparkesK&L Gates LLPK&L Gates LLPState Street Financial CenterOne Lincoln StreetBoston , MA 0211 1Work Phone (978)337-4309Work Phone (617)261 -3100Work Phone (617)951-9134Added Date: 12/07/2009

015820

659462

650005

663626

Page: 2


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C R T R 2 7 0 ~ C R

Defendant: Antonio Ibanez

Printed: 01/08/2010 11 :08 am

COMMONWEALTH OF MASSACHUSETTSlAND COURT DEPARTMENT

Docket Report08 MISC 384283

U.S.Bank National Association, as v. Ibanez,Antonio et al

Case No: 08 MISC 384283

Private CounselPaul Rodney CollierAttorney at LawAttorney at LawCentral Plaza,12th Floor675 Massachusetts AvenueCambridge, MA 02139Work Phone (617)441-3300Added Date: 06/01/2009

092040

Page: 3


38/107

CRTR2709-CR COMMONWEALTH OF MASSACHUSETTSLAND COURT DEPARTMENT

Docket Report08 MISC 384283

U.S.Bank National Associat ion, as v. Ibanez.Antonio et al

DOCKET ENTRIES

Case assigned to the Average Track per Land Court Standing Order 1 04.Land Court miscellaneous filing fee 154641 Date: 09/16/2008Land Court surcharge Receipt: 154641 Date: 09/16/2008Land Court summons Receip t 154641 Date: 0911612008Full Party Name: U.S. Bank National Association. as Trustee for the Structured AssetSecurities Corporation Mortgage Pass-Through Certificates, Series 2006-ZUniform Counsel Certificate for Civil Cases filed by Plaintiff.The case has been assigned to the A Track. Notice sentEvent ScheduledEvent: Case Management ConferenceDate: 11117/2008 Time: 03:00 PMNotice sent to attorneys Walter H. Porr, Jr. and Coleen Hayes.Result: Case Management Conference heldSummons returned to Court with service on Antonio Ibanez filed.Motion for General Default filed.Case Management Conference HeldThe following event: Case Management Conference scheduled for 11/17/2008 03:00PM has been resulted as follows:Result: Case Management Conference heldRequest for Default pursuant to Mass. RCiv.P.55(a) on Defendant Antonio Ibanez,filed.Defendant Antonio Ibanez defaulted pursuant to Mass. RCiv. P. 55(a). (Patterson,

Notice of Docket Entry. Defendant Antonio Ibanez defautled pursuant to Mass.RCiv. P. 55(a). (Patterson. Rec.)Copies sent to Walter H. Porro Jr., Esq. and Coleen E. Esq.Affidavit of Sean Burke filed.Affidavit of Walter H. Porr, Jr filed.ScheduledEvent: Telephone Conference CallDate: 0210212009 Time: 09: 15 AMNotice sent to Walter H. Porro Jr. EsqResult: Status Conference held.ScheduledEvent: MotionDate: 02/11/2009 Time: 10:30 AMNotice sent to Walter H. Porr, Jr. Esq.Result: Taken under advisement.


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CRTR2709-CR

02/02/2009

02/02/200902/02/200902/06/2009

02/06/200902/11/2009

02/17/2009

03/26/2009

03/26/200904/06/200904/06/200904/08/2009

04/16/20090411712009

04/17/2009

04117/2009

COMMONWEALTH OF MASSACHUSETTSLAND eOURT DEPARTMENT

Docket Report

08 Mise 384283U.S.Bank National Association, as v. Ibanez, Antonio at al

Event ResultedThe following event: Telephone Conference Call scheduled for 02/02/2009 09: 15 AMhas been resulted as follows:Result: Status Conference held,Affidavit of Walter H, Parr, Jr, filed,Motion for Entry o f Default Judgment filed.Supplemental Memorandum of Law In Support of Motion for Entry of DefaultJudgment filed.Supplemental Affidavit of Wal ter H. Parr, Jr. filed.Event ResultedThe event: Motion scheduled for 02111/200910:30 AM has been resultedas follows:Result: Taken under advisement.Second Supplemental Memorandum of la w In Support of Motion for Entry of DefaultJudgment filed.Memorandum and Order on Plaintiffs' Motions for Entry of Default Judgment, issued.

Sent to Attorneys Walter H: Parr and Coleen E. Hayes)Judgment entered.Motion for Expedited

Sent to Attorneys Walter H. Parr and Coleen E. Hayes}on Plainti ffs Motion to Vacate filed.

Motion to Vacate Judgment filed.ScheduledEvent: MotionDate: 04/17/2009 Time: 02:00 PMNotice sent to Walter H. Parr, Esq.Result: Event HeldMotion to Intervene with Points and Authorities filed.Motion to Intervene in the Public Interest for the Purpose of Submitting an AmicusAffidavit and AnalYSIS and to at the to Be Held on April 17, 2009filed.Event ResultedThe following event: Motion scheduled for 04/17/2009 02:00 PM has been resultedas follows:Result: Plaintiffs Motion to Vacate Judgment Heard.Motion to Intervene with Points and Authorities DENIED for reasons stated on therecord at the April 17, 2009


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CRTR2709-CR

04/21/2009

04/28/2009

04/28/2009

05/27/2009

06/01/200906/08/200906/08/2009

Printed: 01/08/2010 11:08 am

COMMONWEALTH OF MASSACHUSETTSLAND COURT DEPARTMENT

Docket Report

08 MiSe 384283U.S.Bank National Association, as v. Ibanez, Antonio et al

Notice of Docket Entry: Plaintif fs Motion to Vacate Judgment Heard on April 17,2009. The Plaintiff Conceded that its Complaint Alleged the Post-Notice, Post-SaleAssignment of the Mortgage at Issue to the Entity in whose Name Notice was Givenand the Foreclosure Sale Conducted (see G. L. c. 231, sec 87 D$u Party Bound byAlle9ations in its Pleadings) but now Represents that Documents may Exist whichmay Show a Pre-Notice, Pre-Sale Assignment Sufficient under G. L. c. 244, sec 14 .Accordingly, the Plaintiff was Given Leave to Submit the Following Materials (andonly these Materials), each of which must be Properly Authenticated: (1) theDocuments which Created the Securitized Trust and Govern its Operations, (2) theDocuments Identifying the "Blocks of Mortgages Sold into that Trust," whichPurportedly Include the Mortgage at Issue in this Case, (3) the "Collateral File" for theMortgage as it Existed at the Time the Foreclosure Sale was Noticed andConducted, which was Represented to Include the Original Note, the Original (or aCopy) of the Mortgage, Endorsements or Assignments "in Blank," "OtherDocuments," and Perhaps a Timely Assignment in Recordable Form, (4) the MasterServicing Agreement, Showing the Relationship between the Trust and the LoanServicer (which Apparently was the Entity Instructing and Supervising the Attorneyswho Noticed and Conducted the Foreclosure), (5) the Power of Attorney under whichthe Loan Servicer Acted in this Instance, along with its Recording Information, and(6) the Powers of Attorney or Certificates of Incumbency, which Purportedly Evidencethe Authority of the Particular Individuals who Acted on Behalf of the Loan Servicer inthis Instance, along with their Recording Information . The Court has Concerns aboutthe Apparent Practice of Assignments "in Blank," what Plaintiff Means by that Term,the Legal Sufficiency of Such a Practice in the Context of Mortgage Assignments andG. L. c. 244, sec 14, and the Possibility that Names may have been Placed on thoseDocuments Post-Notice and Post-Sale. Accordingly, all Documents Reflecting orPurporting to Reflect an Assignment of the Promissory Note or Mortgage must beProduced in the Form they Existed at the Time the Foreclosure Sale was Noticedand Conducted, along with an Affidavit from a Witness with Direct PersonalKnowledge so Attesting. That Witness must also be Available for Examination at anEvidentiary Hearing if the Court so Directs. The Documents Listed Above must beFiled with the Court no Later than May 27, 2009, along with a Certificate ShowingService on the Defendants and on Counsel for Amici Darlene Manson, KeithNicholas, Deborah Nicholas and Germano DePina (Kevin Costello, Esq., RODDYKLEIN & RYAN, 727 Atlantic Avenue, 2nd Floor, Boston MA 02111). The Plaintiffmay also File a Memorandum Explaining the Documents and its ContentionsRegarding their Significance. The Court will Act on the Motion to Vacate after itReceives and Reviews these Materials, and after the Amici have had a ReasonableTime (not to Exceed Ten Business Days) to Submit a Memorandum Regardingthem. (Notices Sent to Attorneys Walter H. Porr, Jr., and Kevin Costello; also Sentto Mr. Antonio Ibanez)Motion to Intervene in the Public Interest for the Purpose of Submitting an AmicusAffidavit and Analysis and to Appear at the Hearing to Be Held on April 17, 2009ALLOWED.Amicus Brief of Marie McDonnell of Truth In Lending Audit and Recovery Services,LLC filed.Motion for Extension of Time to File Third Supplemental Memorandum of Law inSupport of Motion for Entry of Default Judgment filed and ALLOWED IN PART.Plaintiffs time to comply with the court's April 21, 2009 Notice of Docket Entry isextended to 4:00 p.m., June 8, 2009.Appearance of Paul Rodney Collier III, Esq. for Antonio Ibanez.. . . . ..Second Supplemental Affidavit of Walter H. Porr, Jr. filed .Affidavit of Michelle Halyard filed.

Case No: 08 MISC 384283 Page: 6


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CRTR2709-CR

06/08/200906/08/200906/11/200906/11/2009

06/11/200906/12/2009

06/12/200906/12/2009

06/151200906/17/200906/29/200906/29/2009

06/29/200906/30/200906/30/2009

06/30/2009OJ 03/200910/14/2009

10/30/200910/30/2009

Printed: 01/08/2010 11:08 am



U.S.Bank National Association, as v. Ibanez, Antonio et al

Affidavit of Robert Salazar filed .Third Supplemental Memorandum of 'Law in Support of Motion for Entry of DefaultJudgment filed.Defendant's Motion for Extension of Time to File Reply to Third Supplemental. Memorandum filed.Amicus Curiae's Motion for Enlargement of Time to File Responses to Plaintiffs'Supplemental Materials and Memorandum of Law in Support of Plaintiffs' Motion forEntry of Default Jud9ment filed.Motion of Amici Curiae for Extension of Time to File Response to ThirdSupplemental Memorandum filed.Motion of Amici Curiae for Extension of Time to File Response to ThirdSupplemental Memorandum ALLOWED. Response shall be due no later than June29,2009 .Defendant's Motion for Extension of Time to File Reply to Third SupplementalMemorandum ALLOWED. Response shall be due no later than June 29, 2009 .Amicus Curiae's Motion for Enlargement of Time to File Responses to Plaintiffs'Supplemental Materials and Memorandum of Law in Support of Plaintiffs' Motion forEntry of Default Judgment DENIED.Motion to Intervene for the Purpose of Submitting an Amicus Brief filed.... .Motion of Real Estate Bar Association for Massachusetts for Leave to File aStatement of Interest filed.Motion for Leave to Appear as Amicus Curiae by National Consumer Law Center. filed.Consolidated Memorandum of Points and Authorities of Amici Curiae DarleneManson, Keith and Deborah Nicholas and Germano Depina and Proposed AmicusNational Consumer Law c:enter in Opposition to Plaintiffs' Motion to Vacate filed.Memorandum of Antonio Ibanez in Opposition to Plaintiffs Motion to VacateJudgment filed .Motion of Amicus Curiae, Marie McDonnell, to Allow Her Affidavit and Expert Reportinto the Record in the Above Referenced Cases filed.Affidavit of Amicus Curiae, Marie McDonnell, Verifyin9 Her Expert Report Titled"Evidence and the Burden of Proof in Documenting the Chain of Title in SecuritizedMortgage Transactions" filed.Report Titled "Evidence and the Burden of Proof in Documenting the Chain of Title inSecuritized Mortgage Transactions" filed.Affidavit of Thomas ", . Tarter (original) filed.Memorandum and Order on the Plaintiffs' Motions to Vacate JUdgment, issued.(Copies Sent to Attorneys Walter Harley Porr, Jr.. Coleen Hayes, Paul RodneyCollier, III, Max Weinstein, Eloise P. Lawrence, David Dineen and Glenn F. Russell,Jr.)(Also Sent to Amici: Attorneys Edward A. Rainen, Ward P. Graham, Martin R.Haller, Robert J. Moriarty, Jr., Kevin Costello, Gary Klein , Shennan Kavanagh.Robert Hobbs, Marie McDonnell and Reneau L. Longoria)Notice of Appeal by U.S.Bank National Association, as Trustee for the StructuredAsset Securities Corporation, etc. to the Appeals Court filed.Letter and Supporting Documents filed by David C. Breidenbach, Esq.



42/107

CRTR2709CR

12/07/2009

12/07/2009

1210712009

Printed: 01/08/2010 11 :08 am



U.S.Bank National Association, as v. Ibanez, Antonio et al

Notice of Order of Transcripts of Proceedings for Appeal of Plaintiffl Appellant U.S.Bank National Association, as Trustee, filed.Appearance of Robert Bruce Allensworth Esq . for U.S. Bank National Association, asTrustee for the.Structured Asset Securities Corporation, etc .Appearance of Robert W. Sparkes III, Esq. for U.S.Bank National Association, asTrustee for the Structured Asset Securities Corporation, etc .



43/107

CRTR2709-CR

CASE TYPE:ACTION CODE:

MiscellaneousCOT

COMMONWEALTH OF MASSACHUSETISLAND COURT DEPARTMENT

Docket Report

08 MISC 386755Wells Fargo Bank, N.A., as v. Larace, Mark et al LONG

FILE DATE:CASE STATUS:DESCRIPTION: COT - Remove Cloud on Title, G,L. STATUS DATE:

10/30/2008Closed03/26/2009

CASE TRACK: CASE JUDGE: Long, Keith CCASE SESSION: Courtroom 6LINKED CASE:

PARTIES

Plaintiff: Wells Fargo Bank, NA, as Trustee for ABFC Private CounselRobert Bruce AllensworthK&L Gates LLPK&L Gates LLPState Street Financial CenterOne Lincoln StreetBoston, MA 02111-2950Work Phone (617)261-3119Work Phone (617)261-3100Added Date: 12/07/2009Private CounselWalter Harley PorrAblitt Law Offices, P.C,Ablitt Law Offices, P,C,304 Cambridge RoadWoburn, MA 01801Work Phone (781 )246-8995Work Phone (781)569-6025Work Phone (781 )246-8995Work Phone (617)953-3420Work Phone (781)286-8166Work Phone (617)961-3465Added Date: 10/30/2008Private CounselRobert W. SparkesK&L Gates LLPK&L Gates LLPState Street Financial CenterOne Lincoln StreetBoston, MA 02111Work Phone (978)337-4309Work Phone (617)261-3100Work Phone (617)951-9134Added Date: 12/07/2009

IPrinted: 01/08/2010 11 :10 am Case No: 08 MISC 386755

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Defendant: Mark A Larace

Defendant: Tammy L Larace

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Docket Report

08 MiSe 386755Wells Fargo Bank, N.A., as v. Larace, Mark at al

Case No: 08 MISC 386755

Private CounselGlenn F. RussellLaw Office of Glenn F. Russell, Jr.Law Office of Grenn F. Russell, Jr.38 Rock StreetSuite #12Farr River, MA 02720Work Phone (508)673-4545Work Phone (508)324-4545Work Phone (401 )253-2352Work Phone (401)349-3055Work Phone (401)243-3509Added Date: 06/01/2009

Private CounselGlenn F. RussellLaw Office of Glenn F. Russell, Jr.Law Office of Glenn F. Russell, Jr.38 Rock StreetSuite#12Fall River, MA 02720Work Phone (508)673-4545Work Phone (508)324-4545Work Phone (401 )253-2352Work Phone (401 )349-3055Work Phone (401)243-3509Added Date: 06/01/2009

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Date10/30/200810/30/200810/30/200810/30/200810/30/200810/3012008

10/30/200811/10/200811/1712008

12/02/200812/29/2008

12/31/200801/05/2009

01/05/200901/07/2009

I eference

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Wells Fargo Bank, N.A., as v. Larace, Mark et al

DOCKET ENTRIESDescription

Complaint filed.Case assigned to the Average Track per Land Court Standing Order 1 04.Land Court miscellaneous filing fee Receipt: 158469 Date: 10/30/2008Land Court surcharge Receipt: 158469 Date: 10/30/2008. . . ..Land Court summons . Receipt : 158469 Date: .10/30/2008Full Party Name: Wells Fargo Bank. N.A., as Trustee for ABFC 2005-0PT1 Trust,ABFC Asset Sacked Certificates Series 2005-0PT 1Uniform Counsel Certificate for Civil Cases filed by Plaintiff .The case has been assigned to the A Track. Notice sent.Event ScheduledEvent: Case Management ConferenceDate: 01/05/2009 Time: 03:00 PMNotice sent to Walter H. Porr, Jr. . Esq.Result: Case Management Conference heldSummons returned to Court with service on Marl


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01/07/2009

01/07/2009

02/02/2009

02/02/200902/04/200902/06/200902/06/200902/11/2009

02/1712009

03/26/2009

03/26/200904/06/200904/06/200904/08/2009

04/16/200904/17/2009

04/17/2009

04/17/2009

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Docket Report

08 MiSe 386755Wells Fargo Bank, N.A., as v. Larace, Mark et al

ScheduledEvent: Motion for JudgmentDate: 02111/2009 Time: 10:30 AMNotice sent to Walter H. Parr. Jr . Esq .Result: Taken under advisement.Notice of Docket Entry of Case Management Conference Sent to Walter Harley Parr,Jr . Esq .Event ResultedThe following event: Telephone Conference Call scheduled for 02/02/200909 :15 AMhas been resulted as follows :Result: Status Conference held .Affidavit of Walter H. Parr, Jr. filed.Motion for Entry of Default Judgment filed .Supplemental Memorandum of Law In Support of Motion for Entry of DefaultJudgment fi.ed.Supplemental Affidavit of Walter H. Parr, Jr. filed.Event ResultedThe following event: Motion for Judgment scheduled for 02/11/200910 :30 AM hasbeen resulted as follows:Result: Taken under advisement.Second Supplemental Memorandum of Law In Support of Motion for Entry of Default

. Judgment filed .Memorandum and Order on Plaintiffs' Motions for Entry of Default JUdgment, issued .(Copies Sent to Attorneys Walter H. Parr, and Coleen Hayes)Judgment entered. (Copies Sent to Attorneys Walter H . Parr, and Coleen Hayes)Motion for Expedited Hearing on Plaint iff s Motion to Vacate Judgment filed .Mot ion to Vacate Judgment filed.ScheduledEvent: MotionDate: 04/17/2009 Time: 02:00 PMNotice sent to Walter H. Parr, Esq.Result: Event HeldMotion to Intervene with Points and Authorities filed.Motion to Intervene in the Public Interest for the Purpose of Submitting an AmicusAffidavit and Analysis and to Appear at the Hearing to Be Held on April 17, 2009filed .Event ResultedThe following event: Motion scheduled for 04/17/2009 02:00 PM has been resultedas follows:Re sult: PlainmfsMotion to Vacate Judgmen t Heard .Motion to Intervene with Points and Authorities DENIED for reasons stated on the

. record attheApr il17. 2009 hearing .

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04/21/2009

04/28/2009

04/28/2009OS/27/2009

06/01/200906/08/200906/08/2009

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COMMONWEALTH OF MASSACHUSETISLAND COURT DEPARTMENT

Docket Report08 Mise 386755

Wells Fargo Bank, N,A" as v, Larace, Mark et al

Notice of Docket Entry: Plaintiff's Motion to Vacate Judgment Heard on April 17,2009. The Plaintiff Conceded that its Complaint Alleged the Post-Notice, Post-SaleAssignment of the Mortgage at Issue to the Entity in whose Name Notice was Givenand the Foreclosure Sale Conducted (see G. L. c. 231, sec. 87 D$u Party Bound byAllegations in its Pleadings) but now Represents that Documents may Exist whichmay Show a Pre-Notice, Pre-Sale Assignment Sufficient under G. L. c. 244, sec. 14.Accordingly, the Plaintiff was Given Leave to Submit the Following Materials (andonly these Materials), each of which must be Properly Authenticated: (1) theDocuments which Created the Securitized Trust and Govem its Operations, (2) theDocuments Identifying the "Blocks of Mortgages Sold into that Trust," whichPurportedly Include the Mortgage at Issue in this Case, (3) the "Collateral File" for theMortgage as it Existed at the Time the Foreclosure Sale was Noticed andConducted, which was Represented to Include the Original Note, the Original (or aCopy) of the Mortgage, Endorsements or Assignments "in Blank," "OtherDocuments," and Perhaps a Timely Assignment in Recordable Form, (4) the MasterServicing Agreement, Showing the Relationship between the Trust and the LoanServicer (which Apparently was the Entity Instructing and Supervising the Attorneyswho Noticed and Conducted the Foreclosure), (5) the Power of Attorney under whichthe Loan Servicer Acted in this Instance, along with its Recording Information, and(6) the Powers of Attorney or Certificates of Incumbency, which Purportedly Evidencethe Authority of the Particular Individuals who Acted on Behalf of the Loan Servicer inthis Instance, along with their Recording Information. The Court has Concerns aboutthe Apparent Practice of Assignments "in Blank," what Plaintiff Means by that Term,the Legal Sufficiency of Such a Practice in the Context of Mortgage Assignments andG. L. c. 244, sec. 14, and the Possibility that Names may have been Placed on thoseDocuments Post-Notice and Post-Sale. Accordingly, all Documents Reflecting orPurporting to Reflect an Assignment of the Promissory Note or Mortgage must beProduced in the Form they Existed at the Time the Foreclosure Sale was Noticedand Conducted, along with an Affidavit from a Witness with Direct PersonalKnowledge so Attesting. That Witness must also be Available for Examination at anEvidentiary Hearing if the Court so Directs. The Documents Listed Above must beFiled with the Court no Later than May 27, 2009, along with a Certificate ShowingService on the Defendants and on Counsel for Amici Darlene Manson, KeithNicholas, Deborah Nicholas and Germano DePina (Kevin Costello, Esq., RODDYKLEIN & RYAN, 727 Atlantic Avenue, 2nd Floor, Boston MA 02111). The Plaintiffmay also File a Memorandum Explaining the Documents and its ContentionsRegarding their Significance. The Court will Act on the Motion to Vacate after itReceives and Reviews these Materials, and after the Amici have had a ReasonableTime (not to Exceed Ten Business Days) to Submit a Memorandum Regardingthem. (Notices Sent to Attorneys Walter H. Porr, Jr., and Kevin Costello; also Sentto Mark Larace and Tammy Larace)Motion to Intervene in the Public Interest for the Purpose of Submitting an AmicusAffidavit and Analysis and to Appear at the Hearing to Be Held on April 17, 2009ALLOWED.Amicus Brief of Marie McDonnell of Truth In Lending Audit and Recovery Services,LLC filed.Motion for Extension of Time to File Third Supplemental Memorandum of Law inSupport of Motion for Entry of Default Judgment filed and ALLOWED IN PART.Plaintiff's time to comply with the court's April 21, 2009 Notice of Docket Entry isextended to 4:00 p.m., June 8, 2009.Appearance of Glenn F. Russell Jr., Esq. for Mark A Larace, Tammy L Larace.. . .Second Supplemental Affidavit of Walter H. Porr, Jr. filed.Affidavit of Michelle Halyard filed.



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06/08/200906/08/2009

06/11/2009

06/11/2009

06/12/2009

06/1 2/2009

06/1712009

06129/2009

06/29/2009

06/29/2009

06/30/2009

06/30/2009

06/30/2009

10/14/2009

10/30/2009

11/03/200912/07/2009

12/07/2009

12/07/2009

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Docket Report

08 MiSe 386755Wells Fargo Bank, N.A., as v. Larace, Mark et al

Affidavit of Robert Salazar filed .Third Supplemental Memorandum of Law in Support of Motion for Entry of DefaultJudgment filed.Amicus Curiae's Motion for Enlargement of Time to File Responses to Plaintiffs'Supplemental Materials and Memorandum of Law in Support of Plaintiffs' Motion forEntry of Default Judgment filed.Motion of Amici Curiae for Extension of Time to File Response to ThirdSupplemental Memorandum filed.Motion of Amici Curiae for Extension of Time to File Response to ThirdSupplemental Memorandum Allowed . Response shall be due no later than June 29,2009.Amicus Curiae's Motion for Enlargement of Time to File Responses to Plaintiffs'Supplemental Materials and Memorandum of Law in Support of Plaintiffs' Motion forEntry of DefaultJudgment [)ENIED.Motion of Real Estate Bar Association for Massachusetts for Leave to File aStatement of Interest filed .Memorandum in Support of Opposition to Plainti ffs Motion for Entry of DefaultJudgment filed.Motion for Leave to Appear as Amicus Curiae by National Consumer Law Centerfiled.Consolidated Memorandum of Points and Authorities o f Amici Curiae DarleneManson, Keith and Deborah Nicholas and Germano Depina and Proposed AmicusNationalConsurner.Law Center in Opposition to Plaintiffs' Motion to Vacate filed ..Motion of Amicus Curiae, Marie McDonnell, to Allow Her Affidavit and Expert Reportinto the Record in the Above Referenced Cases filed.Affidavit of Amicus Curiae, Marie McDonnell, Verifying Her Expert Report Titled"Evidence and the Burden of Proof in Documenting the Chain of Tille in SecuritizedMortgage Transactions"fBed.Report Titled "Evidence and the Burden of Proof in Documenting the Chain of Title in

.Securitized Mortgage Transactions" filed .Memorandum and Order on the Plaintiffs' Motions to Vacate Judgment, issued .(Copies Sent to Attorneys Walter Harley Porr , Jr., Coleen Hayes, Paul RodneyCollier, III , Max Weinstein, Eloise P. Lawrence, Da vid Dineen and Glenn F. Russell,Jr.)(Also Sent to Amici: Attorneys Edward A. Rainen, Ward P. Graham, Martin R.Haller, Robert J. Moriarty, Jr , Kevin Costello, Gary Klein , Shennan Kavanagh,Robert Hobbs, Marie McDonnell and Reneau L. Longoria)Notice of Appeal by Wells Fargo Bank, NA , as Trustee for ABFC 20050PT1 Trust,ABFC Asset Backed etc to the Appeals Court filed.Letter and Supporting Documents filed by David C. Breidenbach, Esq.Notice of Order of Transcripts of Proceedings for Appeal of Plaintiffl Appellant WellsFargo Bank, N.A ., as Trustee, filed.. . .Appearance of Robert Bruce Allensworth Esq. for Wells Fargo Bank, N .A ., asTrustee for ABFC 2005-0PT1 Trust, ABFC Asset Backed etc.Appearance of Robert W. Sparkes III , Esq. for Wells Fargo Bank, NA , as Trustee

. or ABFC 2005-0PT1 Trust , ABFC Asset Backed etc.



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(SEAL)) COMM:ONWEALTH OF MASSACHUSETTSTHE TRIAL COURTLAND COURT DEPARTMENT

: i i I

HAWDEN,ss.)

U.S. BANK NATIONAL ASSOCIATION, )as trustee for the Structured Asset ) ,Securities Corporation Mortgage Pass- )Through Certificates, Series 2006-Z, )

Plaintiff,v.

ANTONIO IBANEZ, Defendant.

LASALLE BANK NATIONALASSOCIATION, as trustee for thecertificate holders of Bear Steams AssetBacked Securities I, LLC Asset-BackedCertificates Series 2007-HE2,

Plaintiff,v.

FREDDY ROSARIO, Defendant

)))))))))))))))))))

- - - - - - - - - - - - - - - - - - - - - - - - - - ~ )WELLS F A R G O B ~ N.A., as trusteefor ABFC 2005-0PT 1 Trust, ABFC AssetBacked Certificates Series 2005-0PT 1,

Plaintiff,v.MARK A. LARACE and TAMMY L.LARACE,

Defendants.

)))))))))))

- - - - - - - - - - - - - - - - - - - - - - - - - - ~ )

MISC. CASE NO. 384283 (KCL)



MEMORANDUM AND ORDER ON PLAlNTIFFS' MOTIONS FOR ENTRY OFDEFAULT JUDGMENT

'j",

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In.troduction. and FactsThe above-captioned c a s e s ~ each brought pursuant to G.L. c. 240, 6 to a cloud

from the title" of the ....... ., ...._-f" 'I in question, present two !;::';:O\A


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nearly fourteen months after the auction took place. Ibanez Complaint at 2, ~ 3; 3, '8 .In Larace, Wells Fargo Bank, in whose name notice was published and sale took place,

also had no interest in the mortgage being foreclosed (either recorded or unrecorded) at the timeof publication or sale. Complaint to Remove Cloud from Title at 2, ,3 ; 3, , 8 (Oct. 23,2008)(filed in Misc. 386755) (hereinafter, the "Larace Complaint"). There also was nothing toindicate that it was acting (or PUIporting to act) as someone else's agent, much less the agent ofthe principal. Motion for Entry of Default Judgment at 2-3 (Feb. 2, 2009) (filed in Misc.386755) (hereinafter, the "Larace Motion"). However, it acquired the mortgage by assignmentten months after the sale, with the assignment declaring an effective date prior to foreclosure(April 18, 2007). Larace Complaint at 2, ,3 .

In Rosario, LaSalle Bank, in whose name notice was published and sale took place, wasthe unrecorded holder of the mortgage at the time of publication and sale, but did not record the

. ~ assignment reflecting that interest until over a year after the sale. Complaint to Remove Cloudfrom Title at 2, ,3 ; 3, , 8 (Oct. 16,2008) (filed in Misc. 386018) (hereinafter, the "RosarioComplaint").

In each of these cases, the bank was the only bidder at the foreclosure sale. Stipulation ofWalter Porr, Esq., Counsel for Plaintiffs (Feb. 11,2009 oral argument).3 In Ibanez, the bankbought the property for $94,350, which was $16,437.27 less than the amount of the outstandingloan ($110,787.27) and $16,650 (15%) less than the bank's calculation of the property's actualmarket value ($lll ,000). Ibanez Complaint at 3, ~ 8; Aff. ofWalter H. Porr, Jr., Ex. G (Jan. 30,2009). In Larace, the bank bought the property for $120,397.03, which was the amount of theoutstanding loan plus "all outstanding fees and costs" and $24,602.97 (17%) less than the bank's

I may consider such stipulation as an admission binding on the plaintiffs for purposes of these motions.White v. Peabody Constr. Co., inc., 386 Mass. 121, 126 (1982).

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calculation of the property's actual market value ($145,000). Lance Complaint at 3, '118; Aff. of (Walter H. Porr, Jr., Ex. E (Feb. 2, 2009). In Rosario, the bank bought the property for $136,000.Rosario Complaint at 3, , 8. Unlike Ibanez and Larace, the record in Rosario does not includeinformation on the amount of the outstanding loan or the market value of the property.

According to the plaintiffs, despite their successful bids and their subsequent recording ofall the relevant documents, they cannot obtain title insurance for the properties - making themeffectively unsaleahle - unless and until these issues are resolved in their favor. They have thusbrought these actions seeking such relief. In each of these cases, the defendants (themortgagors/equity holders of the properties at issue) have been e r v ~ failed to respond, andhave been defaulted. The plaintiffs have moved for entry of default judgment The issues wereclearly identified before those motions were heard and the parties were given full opportunity tosubmit whatever affidavits or other admissible materials they believed necessary for adjudicationof those issues. Notice of Docket Entry (Jan. 7, 2(09) (filed in each case).

Based on the record before me and for the reasons discussed below, I find and rule thatthe Boston Globe was "a newspaper of general circulation" in Springfield at the time of thenotices and sales and thus meets that requirement ofG.L. c. 244, 14. I also find and rule thatLaSalle Bank's foreclosure in Rosario was not rendered invalid by its failure to record theassignment reflecting its status as the holder of the mortgage prior to the foreclosure since it was,in fact, the holder by assignment at the time of the foreclosure, it truthfully claimed that status inthe notice, and it could have produced proof of that status (the unrecorded assignment) if asked.4Finally, I find and rule, however, that the other two foreclosures (U.S. Bank's in Ibanez andWells Fargo Bank's in Larace) are invalid because the notices that named those entities failed toname the mortgage holder as of the date of he sale as required by G.L. c. 244, 14. Neither (r

The notices gave its agent's (counsel for the foreclosure) name and address.

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)

. ."'/...t.... .

\j

u.s. Bank nor Wells Fargo Bank had been assigned the mortgages at the time notice waspubli shed and sale took place. Neither an intention to do so in the future nor the backdating of afuture assignment meets the statute's strict requirement that the holder of the mortgage at thetime notice is published and auction takes place be named in the notice.

AnalysisWhether Publication in the Boston Globe Was Sufficient to Meet the Requirements oIG.L. c.244. 14

G.L. c. 244, 14 requires notification of a foreclosure sale to be published "in anewspaper, if any, published in the town where the land lies or in a newspaper with general

. circulation where the land lies" for that sale to be valid. See Bottomly v. Kabachnick, 13 Mass.App. Ct. 480, 484 (1982) ("The manner in which the notice of the proposed sale shall be given isone of the important terms of the power and a strict compliance with it is essential to the validexercise of the power."). The purpose behind that requirement is easily discerned and simplystated. It is to e11SlUe, for the benefit of the mortgagor whose equity interest is about to diminishor disappear and who may face personal liability for the full amount of any deficiency, that asufficient number of likely bidders learn of the sale so that competition, and thus the highestprice, will result See Roche v. Farnsworth, 106 Mass. 509, 513 (1871) ( ''There is the morereason for this [requiring strict adherence to the statute's notice provisions], where the power [of

, sale] is made to a mortgagee, who is interested merely for himself, and has opportunities forcollusion and for taking unfair advantage of the mortgagor. "). Underlying the noticerequirement is the notion that most of the interested and likely bidders will either live or worklocally or, if from afar, expect the local newspapers to carry the relevant notices.

The plaintiffs in these cases did not choose "a newspaper . . . published in the town wherethe land lies" or even, for that matter, the newspaper with the greatest local circulation. That

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would have been, both these criteria, Springfield Republican. lnSteaa, they chose theBoston Globe for reasons of cost and convenience. According to p"'''''''''''''''''''''''''' cotmsel, the Globehas competitive advertising rates and legal notices advertising department able to

vv1\,Jll l j : ; parties, i m l l D ~ : t i a : t e l ' ) acknowledgereceipt, and promptly publish notices. The record does not maleate. counsel did not know, if

Springfield Republican has rates or capacities.G.L. c. 244, 14, does not require publication in a locally-published

newspaper> in the neWspaper g:reatest circulation, or even on the day with the grea:testcircu1ation.S It is enough to publish "a newspaper with general circulation in the town wherethe land lies . . . . G . L ~ c. 244> 14. The statute does not contain an .... ~ ' J . J . .. . .. . definition of

c r P ! l 1 ' ~ circulation," none appears anywhere in relevant statutory provisions (thosegoverning and not directed the anenllcmtodecisions of our appellate courts. Thus, the familiar tools statutory inilern:retrtic,n

be interpJ.'eted to the of the Legislaturewords by the ordinary oflanguage, considered connection with the eause of enactment, themischief or to be and the main object to be accomplished,to the end that the purpose of framers may effectuated. Courts mustascertain the statute from all its parts and from subject matter towhich it relates, and must interpret the statute so as to render legislationeffective, consonant with sound reason common sense. Words are notdefined a statute should be given usual and accepted meanings, providedthat those meanings are consistent with the statutory purpose. We derive thewords> usual accepted meanings from sources presumably known to thestatute's enactors, such as their use in other legal contexts and dictionarydefinitions.

be

Seideman v. City ofNewton, 452 Mass. 472, 477-78 (2008) (internal quotations and citations

5 The circulation data submitted for both the Springfield Republican and the Boston Globe show that theirSunday editions have their readersbip. The notices in each cases were on = . .,11'1'1,,',,

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)

)

omitted).Black's Law Dictionary is such a source. See id. at 478; Thurdin v. SE lBoston, LLC, 452

Mass. 436, 453 (2008) (both citing Black's). It defines "newspaper" as "a publication forgeneral circulation, usually in sheet form, appearing at regular intervals, usually daily or weekly,and containing matters of general public interest, such as current events." Black's LawDictionary at 1069 (8th ed. 2004). ''Newspaper of general circulation" is defined as "anewspaper that contains news and information of interest to the general public, rather than to aparticular segment, and that is available to the public within a certain geograpbic area." ld. TheBoston Globe met each of these tests in Springfield at the time the notices were published. Itwas a "publication for general circulation" in Springfield.6 It "contain[ed] matters of generalpublic interest," such as national and international news, sports, and business coverage. And itwas available in Springfield on a daily basis during the times in question, both throughsubscription and single-copy sales at stores and by ~ n d o r s .

The Globe also was a newspaper that, for the times in question, met the statute's intent ofreaching a broad audience oflilcely bidders. While it had a fraction of the SpringfieldRepublican's circulation (the Republican sold somewhere between 21,959 and 24,733 copies inSpringfield on an average weekday during the relevant time period)/ the Globe's figures(somewhere between 1,400 and 1,600 copies in Springfield during the relevant time period)8were nonetheless significant and sufficiently "general" in the context of Springfield's overall

6 See circulation figures discussed immediately below.7 The Republican sold 21,959 copies in Springfield on March 7, 2007, and 24,733 copies in Springfield onMarch 28, 2008. Supplemental Aff. of Walter H. Porr, Jr. at Exs. A, B (Feb. 3,2009) (filed in the Larace case). OnMarch 7, 2007, it sold an additionalll.985 copies in the immediately adjacent towns ofWest Springfield,Longmeadow and East Longmeadow. fd. On March 28,2008, it sold an additionalI4,720 copies in those sameadjacent localities. fd.I The Globe sold 1600 copies in Springfield on October 24, 2006 and 1,400 copies in Springfield on October23,2007. Aft: of Walter H. Porr, Jr. at Exs. B, C (Feb. 2, 2009) (filed in the Larace case). It sold an additional 896copies on October 24,2006 and an additiona1674 copies on October 23, 2007 in the immediately adjacent towns ofWest Springfield, Longmeadow and East Longmeadow. Id.

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population at the times in question.9 The Globe's status as one of New England's majornewspapers also makes it likely to reach a large, additional audience of institutional and otherbidders.10. II

In short, while far from the best alternative, the Globe was good enough to meet thestatutory test at the times in question. It was "a newspaper with general circulation in the townwhere the land lies" when the notices were published and thus sufficed under G.L. c. 244, 14.12

Whether Publication Occurred in the Name Required by G.L. c. 244, 14G.L. c. 244, 14 requires that notice of a foreclosure auction be given not only to the

mortgagor and "all persons of record" holding junior interests in the property (by registeredmail), but also by publication in a newspaper of general circulation at least "once in each of threesuccessive weeks, the first publication to be not less than twenty-one days prior to the date ofsale." The purpose of such publication, as previously noted, is to ensure, fcir the benefit of themortgagor whose equity interest is about to diminish or disappear and who may face personalliability for the full amount of any deficiency, that a sufficient number qf1ikely bidders learn ofthe sale so that competition, and thus the highest price, will result. 13 See Roche, 106 Mass. at

9 According to the U.S. Census data submitted by the plaintiffs, there were approximately 57,000 householdsin Springfield during this time period. Id. at Ex. D.10 This is also true of the Springfield Republican and, as shown by their comparative circulation data, evenmore so in the Pioneer Valley area. Supplemental Aft: of Walter H. POrT, Jr. at Exs. A. B.I I The record did not indicate, and counsel did not know, if he notices at issue in these cases appearedstatewide or only in more localized editions of he Globe. For purposes of his Memorandum and Order, I make theconservative assumption that they appeared only in an edition circulated in Springfield and the neighboring PioneerValley area.12 This ruling is not intended, and should not be construed, as a finding that the Globe meets the statutory testin Springfield for any times other than those at issue in these cases. The droJroff in the Globe's circulation inSpringfield between Octobe2" 24, iOO6 and October 23,2007 (1,600 to 1,400 copies - a 12.5% reduction in a singleyear from an already small figure) suggests that foreclosure notices published subsequent to October 2007 may needto be assessed on a case-by-case basis.13 I t is also for the benefit of unior creditors, whose chances for recovery may be diminished or eliminated bythe foreclosure i f here is are insufficient proceeds from the foreclosure to cover all liens. See G.L. c. 183, 27

(

(disposition of proceeds offoreclosure sale); Wiggin v. Heywood, 118 Mass. 514; 516 (1875); Pioneer Credit Corp.. v. Bloomberg, 323 F. 2nd 992, 993-94 (Ist Cir. 1963) (foreclosure of senior encumbrance discharges junior lienswhose holders are made parties to the proceeding).

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513. It is thus, broadly speaking, a consumer protection statute and, as the courts haverepeatedly made clear, one that requires "strict compliance" with its notice provisions. Bottomlyv. Kabachnick, 13 Mass. App. Ct 480, 484 (1982) and cases cited therein.

One of those requirements is that the notice identify "the holder of the mortgage." ld. at.. . - -483. Failure to do so renders the "sale void as a matter oflaw." ld. at 484. The purpose oftbisrequirement and the need for "strict compliance" is readily discerned. As even a cursory glanceat the current caseload of this court reveals, titles arising from mortgage foreclosures can havemany problems. These include the most fundamental: Did the party conducting the foreclosurehave the authority to do so and, if'challenged, can it prove that it had such authority? In short,will a purchaser at the foreclosure sale get good title and will get it in prompt fashion? These areincreasingly important questions in the current deteriorating real estate market and are not smallconcerns. It is increasingly rare for a mortgage to remain with its originating lender. Often, ashere, mortgages are assigned to other entities, and then assigned yet again into large securitizedpOOls.14 Often, as here, the paperwork lags far behind. Sometimes mistakes are made.15Mistakes can only be corrected., if at all, through confirmatory documents (which the borrowermay not so easily agree to) or litigation. With so many foreclosed properties available forpurchase, why bid on a property with even the possibility for such trouble? Why bid on aproperty when the foreclosing party cannot produce all the documents (including propermortgage assignments in recordable form) that would give good title? Why take the risk that theforeclosing party will be able to produce the documents promptly after the auction takes place,14 In Ibanez, for example, the mortgage was originally granted to Rose Mortgage, Inc., then assigned toOption One Mortgage Corporation, then assigned to American Home Mortgage Servicing, Inc., and then assigned tothe Structured Asset Securities Corporation Mortgage Pass-1brough Certificates, Series 2006-Z, ofwhich U.S. Bankis currently the trustee. Ibanez Complaint at 2, 'JI3. Larace and Rosario have similar histories.IS See, e.g., LaSalle Bank National Association, as trustee for Merrill Lynch First Franklin Mortgage LoanTrust, MortgageLoankset-Backed Certificates, Series 2007-1 v. Truong, Land Court Misc. Case No. 390707

'" ) (KCL) (assignment made, servicemembers action brought and judgment entered, G.L. c. 244, 14 noticespublished, foreclosure conducted, and foreclosure deeds issued in incorrect name).

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that those documents will be complete and in proper form, or even (in this era of failed andfailing institutions) that the foreclosing party will still be in existence, with intact files andknowledgeable employees able to find those files so that the proper paperwork can be

completed? Since these concernsaffect the ability to obtain clear, marketable title, why bid areasonable market value instead of a discount price to account for that risk?

None of this is the fault of the mortgagor, yet the mortgagor suffers due to fewer (or no)bids in competition with the foreclosing institution. Only the foreclosing party is advantaged bythe clouded title at the time of auction. It can bid a lower price, hold the property in inventory,and put together the proper documents at any time it chooses. And who can say that problemswon't be encountered during this process? I t is interesting that it took the plaintiff (theforeclosing party and successful bidder) almostfourteen months after the auction to obtain itsassignment in IPanez and ten months after the auction in Larace.16 Would any reasonable third-party bidder have been willing to wait that long, trusting that no other issues would arise?l7Only in Rosario was the assignment (showing that the foreclosing party held the mortgage andcould convey title as a result of the sale) in hand and ready for recording at the time of theauction sale.

The plaintiffs defend the validity of their post-foreclosure assignments (in Ibanez andLarace) and post-foreclosure recording of their assignments (in all cases), making essentiallythree arguments. First, they say that the language of G.L. c. 244, 14 does not require fllat the

16 The foreclosure auction in Jbanez took place on July 5, 2007. Ibanez Complaint ot 3, 18. The mortgagewas not assigned to u.s. Bank until September 2, 2008. Id. at 2, 13. The foreclosure auction in Larace took placeon July 5,2007. Larace Complaint at 3, 18. The mortgage was not assigned to Wells Fargo until May 7, 2008. Id.at 2, ,3.17 There may be an innocent explanation for the delay (Le., a rational business reason for waiting months todocument the assignment), but none was offered or apparent in the record. Moreover, such an explanation isunlikely given the many months of delay, the deteriorating real estate market, the properties ' carrying costs (upkeep,security, and real estate taxes) and the bank's desire for cash. Surely, each of these was a powerful incentive tomove as quickly as possible.

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notice name the holder of the mortgage. They agree that the form of foreclosure notice included)' in the statute contains that requirement explicitly (the signature line on that form is labeled"Present holder of said mortgage" and its text contains both the representation "o fwhich

mortgage the undersigned is the present holder" and the command "ifby assignment, or in anyfiduciary capacity, give reference"), but contend that these are not statutory requirementsbecause the statute permits "alter[ation] [of the form] as circumstances require" and does not"prevent the use of other forms." G.L. c. 244, 14 (Form).

This argument is unpersuasive, for three reasons. First, it ignores Bottomly v.Kabachnick, which states that the notice in that case "was defective because it failed to identifythe holder of he mortgage, thereby rendering the first foreclosure sale void as a matter of aw."13 Mass. App. Ct at 483-84 (citing Roche v. Farnsworth, 106 Mass. 509 (1871) (emphasisadded).18. 19 Second, it ignores the "fundamental preceptO" that "[c ]ourts must ascertain theintent of a statute from al l its parts and from the subject matter to which it relates . . . .DeGiacomo v. Metropolitan Property & Casualty Ins. Co., 66 Mass. App. Ct. 343, 346 (2006)

(emphasis added). The form of foreclosure notice included in G.L. c. 244, 14 is a part of thatstatute, indicative of its intent, and clearly contemplates (as Bottomly holds) that the presentholder of the mortgage be identified in the notice. There is nothing to indicate that this aspect of

JB Roche invalidated a mortgage foreclosure sale because the Dotice, inter alia, failed to Dame the holder ofthe mortgage at the time of the foreclosure sale (defendant George B. Farnsworth). 106 Mass. 509,513 (1871).This omission and the other failings in the notice were "inconsistent with the degree of clearness that ought to existin such an advertisement" Id.19 One can become the "holder of the mortgage" (an interest in land) only by a Writing satisfying the statute offrauds, G.L. c. 259, 1, in recordable form. Thus, the plaintiffs' contention at oral argument that G.L. c. 244, l4'srequirement of "holder" status was satisfied by the assignment of the promissory notes secured by the mortgages to.the securitized pools (apparently done by contract documents referencing them generally, along with hundreds orthousands of other such notes) fails. In any event, no such documents were included in the recortl, so any argumentsbased upon them arc unsupported and waived. Moreover, there is nothing in the record to indicate when thepromissory notes were assigned and the record is unambiguously clear that the mortgages were assigned on thedates referenced herein.

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the notice could "altered.'.20 c. 244, 14. ...........,.............. at oral argument, plamtim'counsel conced

Ibanez - Appeal Supreme Court

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