Opinion
No. 11–P–1916.
2013-02-28
HSBC BANK USA, N.A., trustee, v. Paul L. NORRIS & another.
By the Court (CYPHER, RUBIN & WOLOHOJIAN, JJ.).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The plaintiff (here referred to as HSBC as a convenient shorthand) brought the underlying summary process action in the Housing Court, pursuant to G.L. c. 239, § 1, to evict the defendants, and summary judgment was entered in its favor. On appeal, the defendant Paul Norris (Norris) argues that (1) summary judgment was improperly granted for a number of reasons and (2) the judge abused his discretion in denying additional discovery and denying the defendants' motion for reconsideration. We vacate the judgment.
Discussion. Norris argues that the summary judgment record was not sufficient to establish that HSBC had a superior right to possession. “The purpose of summary process is to enable the holder of the legal title to gain possession of premises wrongfully withheld. Right to possession must be shown and legal title may be put in issue.... Legal title is established in summary process by proof that the title was acquired strictly according to the power of sale provided in the mortgage; and that alone is subject to challenge.” Bank of N.Y. v. Bailey, 460 Mass. 327, 333 (2011), quoting from Wayne Inv. Corp. v. Abbott, 350 Mass. 775, 775 (1966). “To prevail on its motion for summary judgment, [HSBC] ‘had the burden of showing that there are no material facts in dispute regarding its legal title to the property.’ “ Bank of N.Y., supra at 334, quoting from Metropolitan Credit Union v. Matthes, 46 Mass.App.Ct. 326, 330 (1999). We review a decision to grant summary judgment de novo. “The standard of review of a grant of summary judgment is whether, viewing the evidence in the light most favorable to the nonmoving party, all material facts have been established and the moving party is entitled to a judgment as a matter of law.” Augat, Inc. v. Liberty Mut. Ins. Co., 410 Mass. 117, 120 (1991).
Here, the summary judgment record showed that Norris obtained a home mortgage loan from First National Bank of Arizona and, as security for the loan, granted a mortgage to Mortgage Electronic Registration Systems, Inc. (MERS). Norris defaulted on the mortgage payments. On March 8, 2010, the mortgage was assigned to HSBC, which then acquired a foreclosure deed to the property through a foreclosure sale that took place on September 29, 2010. An attorney's affidavit filed with the registry of deeds, pursuant to G .L. c. 244, § 15, stated that the requirements of the power of sale and of G.L. c. 244 had been satisfied. However, the summary judgment record did not establish that HSBC held the note at the time of foreclosure or that it was the authorized agent of the note holder.
Under Eaton v. Federal Natl. Mort. Assn., 462 Mass. 569, 571, 584–586 (2012), foreclosure by sale pursuant to G.L. c. 244, § 14, requires that the mortgagee also hold the mortgage note or be the authorized agent of the note holder. The fact that HSBC had been assigned the mortgage is not enough to effect a valid foreclosure by sale pursuant to G.L. c. 244, § 14. As noted above, HSBC did not present any evidence in the summary judgment record as to who held the note at the time of the foreclosure by sale, or whether it was acting as the authorized agent of the note holder.
As a result, the motion judge in this case should have denied HSBC's motion for summary judgment and also required that Norris receive the discovery he sought concerning the note and the servicing and pooling agreement.
HSBC's arguments on appeal regarding foreclosure by entry have been waived because HSBC's only argument made below was that it had established its superior right of possession as a result of a valid foreclosure by sale. See Carey v. New England Organ Bank, 446 Mass. 270, 285 (2006).
HSBC argues, however, that we should affirm the motion judge's ruling because Eaton applies only prospectively to mortgage foreclosure sales for which the mandatory notice of sale was given after June 22, 2012. See Eaton, 462 Mass. at 569, 588–589. We are not persuaded. Norris is factually and procedurally in the identical situation as was Eaton at the time of the Supreme Judicial Court's decision in Eaton. Among other things, Norris advanced the same arguments to this court at the same time those arguments were being considered by the Supreme Judicial Court. It is certainly not Norris's fault that the issue was first decided favorably in Eaton's case rather than in his, and it would be inequitable to deprive him of its same resolution. See Shapiro v. Worcester, 464 Mass. 261, 268–269 (2013). For the same reason that the Supreme Judicial Court applied its ruling retroactively to Eaton himself, we apply it to Norris. Eaton, 462 Mass. at 589 (“Although we apply the rule articulated in this case prospectively, we nonetheless apply it to [this] appeal because it has been argued to this court by Eaton”). To do otherwise would require us to conclude that the Supreme Judicial Court's retroactive application to Eaton was arbitrary. This, we are naturally loath to do.
The summary judgment is vacated and the case is remanded for further proceedings consistent with this decision, including permitting discovery regarding the holder of the note at the time of the foreclosure sale and regarding the servicing and pooling agreement. Deciding as we do, we need not (and do not) reach any of Norris's other arguments on appeal.
So ordered.