JENNIFER DAUKAS v. MOHAMED DADOUN, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., and the FEDERAL HOME LOAN MORTGAGE CORPORATION.

Introduction

This case concerns the validity of plaintiff Jennifer Daukas’s title to the condominium unit at 57 Boxberry Lane in Rockland. Her deed came from defendant Federal Home Loan Mortgage Corporation (“Freddie Mac”), which was deeded its interest by IndyMac Federal Bank. That deed, in turn, depends upon the validity of IndyMac’s [Note 1] foreclosure against the mortgagor and then-owner of the unit, defendant Mohamed Dadoun, which occurred by two methods — (1) a foreclosure auction on February 11, 2009, and (2) an unopposed entry onto the property immediately thereafter with the certificate of entry, two witnesses attesting, filed at the registry on April 10, 2009 and over three years of possession since the filing of the certificate.

Ms. Daukas has now moved for summary judgment on the primary claims in her complaint (Counts I-III). If resolved in her favor, they are dispositive of the case and moot the need to address the others (Counts IV-VII), which were pled in the alternative. These potentially dispositive claims present three issues.

The first (Count I) is the validity of IndyMac’s foreclosure by entry against Mr. Dadoun. [Note 2] IndyMac was not the holder of the mortgage at the time the G.L. c. 244, §14 “foreclosure under power of sale” (auction) process began, i.e., the date the first notice of the auction was published. [Note 3] Foreclosure by that method was thus invalid. U.S. Bank N.A. v. Ibanez, 458 Mass. 637 , 648 (2011). It was, however, the holder of the mortgage at the time the G.L. c. 244, §§1, 2 foreclosure by entry commenced, i.e. the date of entry. [Note 4] See Bank of New York v. Bailey, 460 Mass. 327 , 331 n. 10 (2011). Did the invalidity of the auction also make the entry invalid? As more fully discussed below, the answer is “no.” The two methods of foreclosure are independent of each other, each standing alone. Ibanez, 458 Mass. at 646, n. 15. The entry was peaceable, more than three years of possession from the time the certificate was recorded have since occurred, and the foreclosure by entry is thus now valid and fully effective. See Joyner v. Lenox Sav. Bank, 322 Mass. 46 , 52-53 (1947) (cited in Ibanez).

The second and third questions arise from mis-spellings. Ms. Daukas’ deed from Freddie Mac mistakenly spells her name “Daukus” rather than “Daukas,” which she alleges was a scrivener’s error. She thus seeks its reformation in Count II. The Dadoun mortgage mistakenly spells his first name “Mohamad” rather than “Mohamed” in the definition of “borrower” — again alleged to be a scrivener’s error, evidenced by the proper spelling on the signature page of the mortgage, signed by Mr. Dadoun with that signature duly notarized. She thus seeks its reformation in Count III. For the reasons set forth below, I agree that the mis-spellings were minor scrivener’s errors, and reform them on the instruments nunc pro tunc.

Discussion

Ms. Daukas seeks summary judgment on the claims referenced above. Such a judgment may be entered if there are no genuine issues of fact material to those claims and, on those facts, Ms. Daukas is entitled to judgment as a matter of law. Mass. R. Civ. P. 56(c); Ng Bros. Constr. v. Cranney, 436 Mass. 638 , 643-644 (2002).

Count I concerns the validity of the foreclosure by entry. The question raised is whether the admitted defect in the foreclosure under power of sale (G.L. c. 244, §14) — the fact that the foreclosing party, IndyMac, was not the holder of the mortgage at the time of first notice — makes the foreclosure by entry (G.L. c. 244, §§ 1, 2) defective as well. As noted above, the answer is “no.” Foreclosure through exercise of the mortgage’s power of sale, and foreclosure by entry followed by the recording of a certificate of entry and three years of possession, are separate and independent methods of foreclosure. Ibanez, 458 Mass. at 646, n. 15. Each stands or falls on its own. See Grabiel v. Michelson, 297 Mass. 227 , 228-229 (1937) (any defect in foreclosure by sale irrelevant after foreclosure by entry completed) (cited in Bailey, 460 Mass. at 331). Thus, the fact that the foreclosing party was not the holder of the mortgage at the time first notice of the auction was published does not affect the validity of the foreclosure by entry, so long as the foreclosing party was the holder at the time of entry and the certificate of entry properly notes that status. See id.

The undisputed facts on this claim are as follows. [Note 5] MERS was the original mortgagee and the mortgagee of record at the time it assigned the mortgage to IndyMac on January 19, 2009. The assignment was recorded on January 20. [Note 6] Mr. Dadoun was in breach of the mortgage and IndyMac was entitled to foreclose. [Note 7] IndyMac’s entry onto the property took place approximately three weeks later on February 11, 2009, and the certificate of entry was recorded at the registry on April 10, 2009. IndyMac and its successors in interest thereafter remained in possession of the property for over three years. The right of redemption has thus been foreclosed, with title in IndyMac and its successors free and clear of any claims by Mr. Dadoun or those whose interests derive from his. See Levin v. Century Indemnity Co., 279 Mass. 256 , 259 (1932) (foreclosure of a mortgage “means a termination of all rights of the mortgagor or his grantee in the property covered by the mortgage”). IndyMac deeded its full interest in the property to Freddie Mac on March 24, 2009 [Note 8] and Freddie Mac subsequently deeded its full interest to Ms. Daukas on March 30, 2012. Under the doctrine of estoppel by deed, those deeds sufficed to grant their full fee title to Ms. Daukas as soon as that title accrued (three years after the recording of the certificate of entry). See Dalessio v. Baggia, 57 Mass. App. Ct. 468 , 469- 470 (2003). Summary judgment is thus ALLOWED on Count I.

Count II seeks reformation of the grantee name “Jennifer Daukus” in the Freddie Mac deed (Mar. 12, 2012) to its correct spelling “Jennifer Daukas.” (emphasis added). Reformation is appropriate when a mutual mistake has occurred, see America’s Wholesale Lender v. Gurinian, 18 LCR 522 , 524-525 (Piper, J.) (collecting cases), and reformation nunc pro tunc when the rights of innocent third parties will not adversely be affected, see Buk Lhu v. Dignoti, 431 Mass. 292 , 294 (2000). Such is the case here. On the facts of this case, there is no question, and no rational inference otherwise, that the grantor intended was Jennifer Daukas, the plaintiff in this case. No third party will adversely be affected. Summary judgment is thus ALLOWED on Count II and reformation granted nunc pro tunc.

The Dadoun mortgage spells his first name “Mohamad” rather than “Mohamed” in the definition of “borrower,” and Count III seeks its reformation to the correct spelling. This was clearly a mutual mistake, warranting reformation, as evidenced by the proper spelling of “Mohamed” on the signature page of the mortgage which was signed by Mr. Dadoun with that signature duly notarized. On the facts of this case, there is no question, and no rational inference otherwise, that the person intended was Mohamed Dadoun, the defendant in this case. No third party will adversely be affected. Summary judgment is thus ALLOWED on Count III and reformation granted nunc pro tunc.

Conclusion

For the foregoing reasons, the plaintiff’s motion for summary judgment on Counts I, II and III is ALLOWED. The remaining claims in the complaint are DISMISSED AS MOOT, WITHOUT PREJUDICE. Judgment shall enter accordingly.