MERS Macerated in Maine Yet Again by Their NEMESIS,
Tom Cox, ESQ
MAINE SUPREME JUDICIAL COURT Reporter of Decisions
Decision: 2014 ME 89
Argued: May 14, 2014
Decided: July 3, 2014
Panel: ALEXANDER, SILVER, MEAD, GORMAN, and JABAR, JJ.
BANK OF AMERICA, N.A.
SCOTT A. GREENLEAF et al.
[¶13] Here, in an attempt to establish its ownership of Greenleaf’s
mortgage, the Bank offered and the court admitted the original mortgage, a
mortgage assignment, and a certification of a merger. The first of these documents
establishes that the Greenleafs executed a mortgage on November 30, 2006,
naming RMS as the lender and MERS as the lender’s nominee. In the second
document, which is dated April 23, 2011, and signed by Aida Duenas, “assistant
secretary,” MERS purports to assign the Greenleaf mortgage to BAC. To explain
why this 2011 assignment fails to support the Bank’s claim that it owns the
mortgage, we return to the language in the 2006 mortgage. In its definitional
section, the mortgage states:
(C) “MERS” is Mortgage Electronic Registration Systems, Inc.
MERS is a separate corporation that is acting solely as a nominee for
Lender and Lender’s successors and assigns. MERS is organized and
existing under the laws of Delaware, and has an address and telephone
number of P.O. Box 2026, Flint, MI 48501-2026, tel.
(888) 679-MERS. FOR PURPOSES OF RECORDING THIS
MORTGAGE, MERS IS THE MORTGAGEE OF RECORD.
(D) “Lender” means RESIDENTIAL MORTGAGE SERVICES,
. . . .
[Borrowers] mortgage, grant and convey the Property to MERS
(solely as nominee for Lender and Lender’s successors and assigns),
with mortgage covenants, subject to the terms of this Security
Instrument, to have and to hold all of the Property to MERS (solely as
nominee for Lender and Lender’s successors and assigns) and to its
successors and assigns, forever. . . . [Borrowers] understand and agree
that MERS holds only legal title to the rights granted by [Borrowers]
in this Security Instrument, but, if necessary to comply with law or
custom, MERS (as nominee for Lender and Lender’s successors and
assigns) has the right:
(A) to exercise any or all of those rights, including, but not
limited to, the right to foreclose and sell the Property; and
(B) to take any action required of Lender including, but not
limited to, releasing and canceling this Security Instrument.
. . . .
[Borrowers] grant and mortgage to MERS (solely as nominee for
Lender and Lender’s successors in interests) the Property described
[¶14] We have already analyzed this exact language in Saunders,
2010 ME 79, ¶ 9, 2 A.3d 289. We concluded that, notwithstanding its reference to
MERS as the “mortgagee of record,” the mortgage in fact granted to MERS “only
the right to record the mortgage” as the lender’s nominee, and “having only that
right, MERS [did] not qualify as a mortgagee pursuant to our foreclosure statute.”10
Id. ¶¶ 10-11 (quotation marks omitted).
[¶15] As in Saunders, despite the language in Greenleaf’s mortgage that
suggests otherwise, Greenleaf’s mortgage did not, as a matter of law, grant to
MERS any right to foreclose on the property. Rather, the mortgage conveyed to
MERS only the right to record the mortgage as nominee for the lender, RMS.
There is also no evidence in the record purporting to demonstrate that MERS
acquired any authority with respect to Greenleaf’s mortgage by any means other
than that defined in the mortgage itself.
[¶16] When MERS then assigned its interest in the mortgage to BAC, it
granted to BAC only what MERS possessed—the right to record the mortgage as
nominee—because MERS could not have granted to another person or entity any
greater interest in the mortgage than that enjoyed by MERS. See Sturtevant v.
Town of Winthrop, 1999 ME 84, ¶ 11 n.4, 732 A.2d 264 (stating that “an assignee
has no greater rights than his assignor”); Arey v. Hall, 81 Me. 17, 22, 16 A. 302
(1888) (“[T]he assignee can have no greater right . . . than the assignor.”).