FNBN1, LLC v. CARLOS A. DEOLIVEIRA [Note 1]
Kevin P. Polansky and Christine M. Kingston for the plaintiff.
Brian J. Wasser for the defendants.
WELCH, J. In this postforeclosure summary process appeal, the defendant-appellant, Carlos A. DeOliveira ("DeOliveira"), claims as error the granting of summary judgment for possession to the plaintiff-appellee, FNBN1, LLC ("FNBN"). Before wading into the procedural thicket, we recount the history of the property located at 16 Bellevue Avenue, Oak Bluffs (the "property"). On April 9, 2007, the original lender, First National Bank of Arizona, assigned the mortgage to Mortgage Electronic Registration Systems, Inc. ("MERS"), as nominee. The mortgage was security for a promissory note (the "note") executed by DeOliveira to First National Bank of Arizona. On September 6, 2011, MERS assigned the mortgage to FNBN via an assignment of mortgage, which was recorded in the Dukes County registry of deeds. In April of 2011, DeOliveira defaulted on his mortgage payments. On July 12, 2011, DeOliveira was informed of his default and FNBN's intent to foreclose. DeOliveira failed to act and cure the default, and, by two letters dated March 22, 2012, FNBN sent via regular and certified mail, return receipt requested, notices as to the foreclosure sale scheduled for April 25, 2012. DeOliveira received two copies of the notices of sale as evidenced by the two signed receipt cards. Notice of the foreclosure sale was published in the Vineyard Gazette, a local newspaper servicing the Oak Bluffs area, on March 30, April 6, and April 13, 2012. On April 25, 2012, the foreclosure sale was held where FNBN was the highest bidder. On May 17, 2012, FNBN executed the foreclosure deed, which was recorded on July 25, 2012 in the Dukes County registry of deeds.
On September 17, 2012, FNBN filed a summary process summons and complaint upon DeOliveira, which complaint was answered by DeOliveira. On February 4, 2013,
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FNBN filed a motion for summary judgment ("Summary Judgment One") seeking possession (although DeOliveira had not paid any moneys since 2011 and was living gratis, no award for money damages was requested). A cross motion for summary judgment was filed by DeOliveira. Both motions for summary judgment were denied. [Note 2]
Subsequent to the denial of Summary Judgment One, FNBN refiled a motion for summary judgment ("Summary Judgment Two") with an affidavit purporting to correct the deficiencies as pointed out in Summary Judgment One by the motion judge. By decision dated June 7, 2013, incorporating the decision of Summary Judgment One therein, the second motion judge found that the deficiencies in the affidavit had been corrected and summary judgment was granted to FNBN for possession. From that decision, DeOliveira appeals, identifying six areas for our review. [Note 3]
The first claim of error is that the motion judge mistakenly granted summary judgment "based on an affidavit that failed to conform to the dictates of section 15." Implicit in the statement is that only an affidavit executed pursuant to G.L.c. 244, §15 can be a basis for summary judgment in a summary process action and any inadequacies in the affidavit are fatal to a judgment for possession. DeOliveira's interpretation of the both the statute and its exclusive import in eviction actions is erroneous. In the seamless web of foreclosure procedures, one of the requirements to be met by the foreclosing party is to comply with providing adequate notice of the sale to the mortgagor under power of sale. [Note 4] Subsequent to the sale of the property, the seller shall record at the registry of deeds the notice of sale and an affidavit,
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with particularity, setting forth the acts that would demonstrate compliance with the statutory power of sale. [Note 5] Section 15 of G.L. c.244 addresses the evidentiary significance of said notice of sale and affidavit. If the affidavit and notice of sale are in proper form and content, an affidavit of sale is sufficient to satisfy the requirements of the statute governing evidence of the power of sale in a summary process action to evict. Deutsche Bank Nat'l Trust Co. v. Gabriel, 81 Mass. App. Ct. 564, 568-569 (2012). A proper affidavit and foreclosure deed are prima facie evidence that the plaintiff in the action has right to possession of the property. Federal Nat'l Mtge. Ass'n v. Hendricks, 463 Mass. 635, 637 (2012) (Hendricks), citing Lewis v. Jackson, 165 Mass. 481, 486-487 (1896).
DeOliveira ascribes more significance to the affidavit of sale in a summary process action than is due. An affidavit that meets the requirements of G.L.c. 244, §15 does nothing more. Such an affidavit is not conclusive proof of compliance with G.L.c. 244, §14 and, if in proper form, is merely evidence that the power of sale was duly executed. Hendricks, supra at 641, citing Atkins v. Atkins, 195 Mass. 124, 127 (1907). In a summary process action for possession, a deficient affidavit of sale does not void a mortgage foreclosure sale or the purchaser's right to possession. Id. at 637, citing Burns v. Thayer, 115 Mass. 89, 93 (1874). If the affidavit of sale is inadequate, then such deficiency may be cured by extrinsic evidence in a summary process action. Id., quoting O'Meara v. Gleason, 246 Mass. 136, 139 (1923). DeOliveira's claim of error is a misstatement of the state of the law.
DeOliveira's next claimed error appears to be with the motion judge's determination that the supplemental affidavit ("Keegan affidavit") was sufficient to establish FNBN complied with the statutory power of sale. DeOliveira does not dispute the admissibility of the affidavit but only the weight to be given the affidavit. As touched on earlier, the Keegan affidavit was a supplemental affidavit filed in Summary Judgment Two as a result of the initial affidavit not passing muster in the first motion for summary judgment.
Summary judgment is appropriate where it can be shown that "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Mass. R. Civ. P., Rule 56(c). Affidavits submitted in support of summary judgment "shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively
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that the affiant is competent to testify to the matters stated therein." Rule 56(e). When reviewing a grant of summary judgment, the court considers the pleadings, depositions, answers to interrogatories, and responses to requests for admission under Mass. R. Civ. P., Rule 36, together with the affidavits, and asks if there is any genuine issue as to any material fact. Rule 56(c). If all material facts have been established and the moving party is entitled to judgment as a matter of law, then the "judgment sought shall be rendered forthwith." Id. See Augat, Inc. v. Liberty Mut. Ins. Co., 410 Mass. 117, 120 (1991). Because our review is de novo, see Bank of N.Y. v. Bailey, 460 Mass. 327, 331 (2011), no deference is accorded the decision of the judge in the trial court. See Johnson v. Gordon, 409 F.3d 12, 17 (1st Cir. 2005). We view the evidence in the light most favorable to the nonmoving party. See Augat, Inc., supra.
In Summary Judgment One, the motion judge denied possession to FNBN as, in the court's considered opinion, FNBN had not established by affidavit ("Ryan-Polczinski affidavit") that it had complied with the statutory power of sale. In a well-crafted opinion, the basis for the ruling was set out with specificity and thorough analysis referencing our Northern District's opinion in HSBC Bank USA, N.A. v. Galebach, 2012 Mass. App. Div. 155, 157-161. In response to the denial of the motion, FNBN filed a second motion that was for purposes of addressing the court's concern in its first filing and to correct any deficiencies. In Summary Judgment Two, a different judge found the second affidavit (Keegan affidavit) to suffice in establishing compliance with the statutory notice of sale provisions.
DeOliveira's position is that there are material issues of genuine fact as the Keegan affidavit renders bare legal conclusions and fails to contain a number of necessary facts, such as failing to allege a default on the mortgage, provide copies of referenced documents, or contain a list of assignments. As to the allegations of missing references, DeOliveira points to no authority, as none exists, requiring such references in the affidavit establishing compliance with the notice of sale. As to the foundation for the admissibility of the affidavit, "a document is admissible as a business record if the judge finds that it was (1) made in good faith; (2) made in the regular course of business; (3) made before the action began; and (4) the regular course of business to make the record at or about the time of the transaction or occurrences recorded." Beal Bank, SSB v. Eurich, 444 Mass. 813, 815 (2005). See Mass. G. Evid. §803(6) (A). The Keegan affidavit is compliant in all respects as to the foundation and admissibility of the document as a business record.
As to the substantive content of the Keegan affidavit, it sets forth, with both personal knowledge and particularity, FNBN's compliance with the statutory notice of sale. Specifically, Keegan attests in her affidavit that she was the attorney manager for the postforeclosure sale department at the law office that conducted the sale, that the foreclosing attorney handled the foreclosure of the mortgage granted by DeOliveira to MERS and held by FNBN by assignments (with recording citations to the relevant registry of deeds), that two notices of sale were sent to DeOliveira (with certified receipt attachments), and that notice was provided in the local newspaper, the Vineyard Gazette, for three consecutive weeks. In all applicable aspects, the Keegan affidavit establishes compliance with the statutory notice of sale provisions of G.L.c. 244, §14.
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DeOliveira's final attempt of claimed error was that there were triable issues of fact raised as to FNBN's lack of a valid assignment. [Note 6] The sole responsibility of FNBN is to establish that FNBN held the mortgage at the time it sent the notices of sale and conducted the foreclosure sale. See U.S. Bank Nat'l Ass'n v. Ibanez, 458 Mass. 637, 650-651 (2011). There is no factual dispute that MERS assigned the mortgage to FNBN on September 6, 2011, prior to the foreclosure sale. DeOliveira's argument has no basis in law or fact.
Summary judgment to the plaintiff is affirmed.
FOOTNOTES
[Note 1] And all occupants.
[Note 2] The court found that that FNBN's failure to comply with G.L.c. 244, §35A was insufficient to entitle DeOliveira to judgment as a matter of law. As to the denial of FNBN's motion for summary judgment, the court found that the affidavit (attached to the foreclosure deed) was insufficient as it failed to indicate any personal knowledge of the affiant.
[Note 3] Although DeOliveira lists six issues for review (the errors were reduced to six from thirteen in the original notice of appeal), the issue labeled number 6, the jurisdiction of the District Court to decide matters affecting title, was not addressed either in the motion for summary judgment or the brief to the Appellate Division; as a result, the issue is not properly before us and is waived. As to issue number 5, whether the trial court erred in entering summary judgment despite the affirmative defense of fraud, there is no evidence in the record other than vague and unsupported claims that the mortgage was obtained by fraud (ignoring the fact that FNBN was not the mortgage originator). As there is scant, if any, credible evidence of fraud as to FNBN, the fifth issue is not properly before us. See Oaks v. King, 2007 Mass. App. Div. 174, citing Cameron v. Carelli, 39 Mass. App. Ct. 81, 85-86 (1995). DeOliveira also maintains that FNBN failed to comply with G.L.c. 244, §15A. As this issue was raised for the first time on appeal and not part of the summary judgment record, it is not properly before us. See D&D Realty Trust v. Borgeson, 2015 Mass. App. Div. 115, 120.
[Note 4] The requirements to be met under a power of sale are set forth in G.L.c. 244, §14 as follows: "[N]o sale under [the power of sale in a mortgage] shall be effectual to foreclose a mortgage, unless, previous to such sale, [1] notice thereof has been published once in each of three successive weeks, the first publication to be not less than twenty-one days before the day of sale, in a newspaper, if any, published in the town where the land lies or in a newspaper with general circulation in the town where the land lies and [2] notice thereof has been sent by registered mail to the owner or owners of record of the equity of redemption as of thirty days prior to the date of sale, said notice to be mailed at least fourteen days prior to the date of sale to said owner or owners ... and unless [3] a copy of said notice of sale has been sent by registered mail to all persons of record as of thirty days prior to the date of sale holding an interest in the property junior to the mortgage being foreclosed, said notice to be mailed at least fourteen days prior to the date of sale to each such person." G.L.c. 244, §14, as amended through St. 1998, c. 463, §181.
[Note 5] The specific affidavit for filing with the registry of deeds is set forth in the appendix to G.L.c. 183. The statutory forms are used to set forth compliance with the various foreclosing procedures, such as the power of sale. G.L.c. 183, §8.
[Note 6] Although the exact argument is ill defined, it appears DeOliveira first argues that prior to the assignment to FNBN by MERS, all notices, such as those pursuant to G.L.c. 244, §35A, were sent to him without FNBN having been assigned the mortgage. Where a notice to cure letter sent to a mortgagor does not fully comply with G.L.c. 244, §35A, the mortgagor has the right to bring an equitable action in Superior Court to enjoin the threatened foreclosure. U.S. Bank Nat'l Ass'n v. Schumacher, 467 Mass. 421, 429 (2014) (Schumacher); Bank of N.Y. Mellon Corp. v. Wain, 85 Mass. App. Ct. 498, 501 (2014). A mortgagor may, in certain circumstances, raise noncompliance with §35A as grounds to challenge the validity of a foreclosure after-the-fact, e.g., through a counterclaim to a summary process action. Schumacher, supra at 422 n.4, 429 n.12. However, in a postforeclosure action, it is not enough for the mortgagor merely to show some noncompliance with §35A. Instead, the mortgagor "must prove that the violation of §35A rendered the foreclosure so fundamentally unfair that she is entitled to affirmative equitable relief, specifically the setting aside of the foreclosure sale `for reasons other than failure to comply strictly with the power of sale provided in the mortgage."' Id. at 433 (Gants, J., concurring), quoting Bank of Am., N.A. v. Rosa, 466 Mass. 613, 624 (2013). DeOliveira fails to provide any factual basis to support such a claim of unfairness.