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How Do Courts in the 50 States View MERS?

STATE
Case and Venue
RESULT
ALABAMA
MERS is "authorized to perform any act on the lender's behalf as to the property, including selling the note and the mortgage to a third party." Common law rule: "...a transfer of a mortgae also transfers the obligation the mortgage secures" unless the notes show otherwise. 
 
MERS can foreclose.  Affirmed by the Alabama Supreme Court.
ALASKA
 
(No case addresses the issue of MERS as plaintiff)
ARIZONA
MERS can be a beneficiary under a deed of trust.  "Beneficiary" does not mean that all beneficial rights were granted by the entity or person granting the beneficiary status. Basket of rights can be split up.
 
"District courts "have routinely held that Plaintiff's 'show me the note' arguement lacks merit."" MERS does not bifurcate note from deed of trust.  OK for MERS to be beneficiary of deed-of-trust. "MERS is the beneficiary with the authority to foreclose."
ARKANSAS
MERS is an agent of the lender.  No harm if lender is named and MERS is not since MERS cannot act on its own anyway.  Despite being named as nominee of the beneficiary in the deed of trust, MERS has no property interest in the secured property.    (????)
    
MERS has the authority to transfer mortgage (DH-this is correct) and the note (DH this is incorrect). 
CALIFORNIA
MERS assignments are valid. MERS is not required to register with the California Secretary of State because enforcing deeds of trust does not constitute "doing business" in California.
 
MERS has standing to bring a foreclosure action.  "Section 2494 (a)(1) states that a  "trustee, mortgagee, or beneficiary, or any of their authorized agents" may initiate the foreclosure process."  Courts do not have the right to create new rights since California is a non-judicial state.
 
 California courts hold that plaintiff does not need to be in "...possession of the note as a precondition to [nonjudiciall] foreclosure under a Deed of Trust".
COLORADO
(No case addresses the issue of MERS as plaintiff)
CONNECTICUT
MERS has standing to bring a foreclosure action. "...there is no question that the named plaintiff is the correct party to bring this action."
DELAWARE
(No case addresses the issue of MERS as plaintiff)
FLORIDA
The owner in title has standing to seek enforcement of the note even if it is not owner of the beneficial interest.  MERS can be the plaintiff in a foreclosure action. (MERS is the owner in title, not the owner of the beneficial interest).
 
per Azize. "...no substantive rights, obligations, or defenses are affected by the use of the MERS devixe, there is no reason why mere form should overcome the salutary substance of permitting the use of this commercially effective means of business"
 
Court dismissed class action to declare MERS in violation of Florida consumer protection laws.
 
MERS, as owner in title, can assign the beneficial interest from one investor to another, even though MERS itself does not have beneficial ownership.  The new assignee has standing to foreclose. MERS can be "non-holder in possession".  (Compare with Vermont and Idaho courts which disagree).
GEORGIA
p. 17 MERS can foreclose.
HAWAII
Beneficiary can bring foreclosure suit even though MERS is still nominee of the security. (DH - seems to agree with KANSAS that MERS is not a necessary party i.e. MERS is not really the title holder)
IDAHO
MERS' "..capacity is representative". When it is unclear as to who owns/holds the note, MERS cannot bring suit.
 
When actual notes prove that chain of ownership of notes is unclear, the MERS assignment cannot on its own prove ownership of the note.  Court states that MERS assignment is legitimate when coupled with proper transfer of note: "In hundreds of stay relief motions, including many post-Sheridan, creditors are providing adequate documentation and explanation to meet the requisite standing requirements."
 
MERS can be beneficiary; MERS can assign beneficial interest; MERS can foreclose.
ILLINOIS
"...MERS has standing to bring this foreclosure action".  "MERS, as nominee for the lender, had authority to act to enforce the mortgage." Terms of the mortgage allows MERS to bring suit in its own name.
INDIANA
MERS is not a necessary party when the bank has disclaimed it's interest. 
IOWA
(No case addresses the issue of MERS as plaintiff)
KANSAS
"Having suffered no injury, MERS lacks standing to bring a foreclosure action." (In Martinez, below, this is qualified to mean that MERS cannot bring an action if it is not the agent of the note holder).
 
Kansas Supreme Court              
"...a nonlender is not a contingently necessary party in a mortgage foreclosure action"  and "...due process does not require that a non-lender be allowed to intervene in a mortgage foreclosure action."  MERS cannot demand to be a party to the proceedings. 
 
(Same person as Graham above).  MERS can bring a foreclosure action if it is the agent of the note holder.  (This qualifies Graham above).
KENTUCKY
MERS can assign mortgage.
LOUISIANA
(No case addresses the issue of MERS as plaintiff)
MAINE
MERS is not the mortgagee.  Mers has no standing to sue.  "MERS lacks standing to institue foreclosre proceedings...."  MERS is not holder nor the non-holder in possession.
MARYLAND
"As to...MERS, courts that have considered the issue have found that the system of recordation is proper and assignments made through that system are valid".
MASSACHUSSETTS
MERS has standing to bring a foreclosure action. "MERS then has the customary rights of a mortgagee under a Massachusetts mortgage and may act under the Mortgage....."
 
U.S. Bankruptcy Court          
MERS  can "...transfer the Mortgage on behalf of the Note holder".
MICHIGAN
MERS cannot foreclose by advertisement (Michigan is a Title-Theory state).  MERS can foreclose by judicial foreclosure.
 
MERS cannot foreclose by advertisement but can assign its security interest.
 
Michigan Supreme Court overturned lower court's decision. MERS can foreclose by advertisement also. 
MINNESOTA
"...assignment of the note operates as an equitable assignment of the underlying instrument", not a transfer of title; therefore no recording is necessary.  Since "the power of sale must be exercised in the name of the party wh has legal title" MERS has standing to bring a foreclosure action.
MISSISSIPPI
(No case addresses the issue of MERS as plaintiff)
MISSOURI
Critics use this case to state that MERS does not have ownership interest.  But in this case, the ownership of the note was in doubt.  Court does not state that if note had been transferred correctly, assignment from MERS would still have been ineffective.
 
MERS v. Bellistri
U.S. District Court - Eastern Division MO.
Federal Court overruled the Missouri Court of Appeals in Bellistri.  Failure to serve notice on MERS violated 14th amendment due process clause.
MONTANA
"MERS, as the beneficiary under the Trust Indenture, had the statutory authority to appoint....as successor trustee."
NEBRASKA
MERS is not a mortgage banker.  MERS is the administrator, never the payee of the security interests.  According to MERS' member agreement, MERS "shall at all times comply with the instructions of the beneficial owner of mortgage loans" and not act on its own.
NEVADA
Critics also use this case to state that MERS does not have standing to foreclose; but judges state otherwise: "Motion brought by MERS as nominee could meet the threshold test of standing, and MERS might be the "real party in interest"..".  Case seems to have a broken chain of title with regards to the note and not a blanket ruling as to standing.
 
Same with this case:  "The Court maks no finding that MERS would not be able to establish itself as a real party in interest had it identified the holder of the note or provided sufficient evidence of the source of its authority." 
 
 
"...MERS....may initiate a foreclosure...".   But court felt that MERS' calling itself "beneficiary" was "improper".  (Please see Tutorial on the Home page).
 
NEW HAMPSHIRE
MERS has authority to assign mortgage.
NEW JERSEY
Court accepted assignment by MERS to plaintiff:  "It is apparent that there was no real intention to separate the note and mortgage at the time those documents were created". Defendant's use of this line of attack was rejected.
NEW MEXICO
(No case addresses the issue of MERS as plaintiff)
NEW YORK
County recorders must record MERS' mortgages, assignments and releases, overturning Supreme Court of Suffolk County.  Court stays away from deciding on the validity of MERS instruments.
 
MERS' assignments are recognized as valid.  Affirms lower court ruling in Bank of N.Y. Mellon v. Sachar.  Overturns results of Bank of N.Y. v. Alderazi and LaSalle v. Lamy.
 
Overturns In re Agard.  Result: MERS' assignements are recognized as valid. 
 
MERS cannot foreclose as nominee for the lender; MERS can only foreclose if the note is endorsed to it so that MERS holds the note in addition to holding title to the mortgage. 
 
Appellate Court 2nd Dept.
MERS cannot foreclose as nominee for the lender.  Affirms, and clarifies Coakley.
 
Excellent review of history of N.Y. litigation.  Situation today:  MERS assignments are valid.  MERS cannot foreclose as nominee for lender. 
NORTH CAROLINA
(No case addresses the issue of MERS as plaintiff)
NORTH DAKOTA
While court found that MERS, as owner of mortgage and note, can foreclose, Judge based his decision on fallacy.  (MERS cannot hold note.)  MERS VP swore that she "controls" the note, but failed to tell the court that she does so as VP of BOA, not of MERS.
OHIO
MERS has standing to bring a foreclosure action.
OKLAHOMA
MERS, Inc. v. William C. Warden, et al., CJ-2005-7027 (District Court of Oklahoma Cty., March 3, 2006, J. Swinton).
Unpublished.  Press reports that court allowed MERS to be plaintiff in this foreclosure action.
OREGON
Court stopped a foreclosure pending clarification in state court as to MERS stating borrower has "likelihood of success against MERS..."
 
In re Alman 2010 WL 3366405
Bankruptcy Court
Case not published.  Cited in Rinegard-Girma (above):  "The court then concluded....that MERS was not “in any real sense of the word, ...the beneficiary of the trust deed.” Instead, MERS was a nominee and the trust deed was for the benefit of the lender."
 
MERS can act as beneficiary under the Deed of Trust and can assign its beneficial interest. 
 
MERS can act as beneficiary "...even if it is not the holder of the note".
 
MERS can initiate non-judicial foreclosure proceedings (!) but must record every assignment in the chain of title of the mortgage in a non-judicial proceeding.
 
MERS can be a beneficiary, can assign interests, can appoint substitute Trustee, and can foreclose. In non-judicial states, there is no obligation to produce the note.
PENNSYLVANIA
MERS, Inc. v. Estate of Harriet L. Watson, et al., Superior Court of Pennsylvania # 637 WDA 2006, 
Unplublished. Press reports that court allowed MERS to be plaintiff in this foreclosure action.
 
MERS has the authority to complete the Sheriff's sale even though it is the nominee. 
RHODE ISLAND
MERS can be the plaintiff in a foreclosure action. "MERS serves as mortgagee of record holding legal title to mortgages....."
SOUTH CAROLINA
(No case addresses the issue of MERS as plaintiff)
SOUTH DAKOTA
(No case addresses the issue of MERS as plaintiff)
TENNESSEE
(No case addresses the issue of MERS as plaintiff)
TEXAS
Deed of Trust gives MERS authority to bring foreclosure suit even though it is not the holder nor the owner of the note, but the "beneficiary" of the deed-of-trust securing the loan.  MERS can be the plaintiff in a foreclosure action - in this case - nonjudicial.
 
Fees accepted by MERS are not in violation of RESPA law.  
UTAH
"...MERS is able to act as the beneficiary for the Trust Deed."
 
"...MERS had the authority to act as a beneficiary under the Deed of Trust....." 
 
"... there is no reason to conclude that MERS could not contract with Plaintiff and other parties to maintain the power to foreclose despite the conveyance of ownership of the debt as long as MERS were to act on behalf of those parties who have the ultimate right to collect the debt."   (cited in Webb v. Citimortgage, Inc.)
VERMONT
MERS cannot be the plaintiff in a foreclosure action - neither independently nor as nominee of the lender.  Court interprets "non-holder in possession" as the buyer of a note that has not been endorsed; and rules that this does not apply to MERS.
 
MERS cannot even hold the mortgage deed when the lender is foreclosing; MERS must assign the mortgage deed back to the lender. 
VIRGINIA
1) The plain language in the Deed of Trust authorizes MERS to foreclose on the Property...."   2) MERS can assign the Deed of Trust.
WASHINGTON
MERS can be beneficiary in a Deed of Trust.
 
Bain v. Metropolitan Mortgage
MERS can only be beneficiary if it Holds the note.  "Next, we are asked to determine the “legal effect” of MERS not being a lawful beneficiary. Unfortunately, we conclude we are unable to do so based upon the record and argument before us."  Not a model of clarity.
WEST VIRGINIA
"...Mers has authority to initiate foreclosure..."
WISCONSIN
MERS, Inc. v. Degner, et al., (Circuit Court for Waukesha
County # 05CV1982)
Unpublished.  Press reports that court allowed MERS to be plaintiff in this foreclosure action.
WYOMING
"The court finds that MERS had authority to assign the mortgage....."
 
NOTE: This database does not list all cases concerning MERS.   
DISCLAIMER: Nothing posted in this site constitutes legal advice.  If you are involved in a legal dispute, please seek competent legal advice immediately.
 
COPYRIGHT 1.1.11 David Hostyk
Copyright David Hostyk Feb. 1, 2011