MARK A. LaRACE and TAMMY L. LaRACE v. WELLS FARGO BANK, N. A., as TRUSTEE for ABFC 2005-OPT1 TRUST, ABFC ASSET-BACKED CERTIFICATES, SERIES 2005-OPT1 and the CERTIFICATE HOLDERS THEREOF, ET AL.

PRIOR RELATED CASES AND RELEVANT PROCEDURAL HISTORY

This is the fourth legal action involving disputes over attempts to foreclose on the defaulted mortgage obligations incurred by Mark and Tammy LaRace pursuant to a 2005 mortgage loan on property in Springfield. It is the third legal action in which the present plaintiffs have sued the present defendant Wells Fargo Bank, N.A., as Trustee for ABFC 2005- Opt1 Trust, ABFC Asset-Backed Certificates, Series 2005-Opt1 ("Wells Fargo"), concerning the same mortgage.

In the first action, the Supreme Judicial Court affirmed a Land Court judgment invalidating a 2007 foreclosure sale of the LaRaces' property because at the time of the foreclosure sale, the mortgagee did not hold both the mortgage and the promissory note secured by the mortgage. U.S. Bank National Association v. Ibanez, 458 Mass. 637 (2011). ("Ibanez") The LaRaces, although the successful defendants in that action, defaulted and did not participate.

In the second action, the LaRaces filed a try title action in Land Court pursuant to G. L. c. 240, §§ 1-5, seeking to require Wells Fargo to demonstrate that it had good title to the property, in light of the LaRaces' claim that Wells Fargo did not hold the mortgage due to a defective chain of assignments. That case was removed to the U. S. District Court, which dismissed the action on the grounds that the try title petition failed to state a claim upon which relief could be granted. LaRace v. Wells Fargo Bank , as Trustee for ABFC 2005-Opt1 Trust, ABFC Asset- Backed Certificates, Series 2005-Opt1, 972 F.Supp.2d 147 (D. Mass. 2013), aff'd LaRace v. Homeward Residential Inc., et al. No 13-2316, July 21, 2015. (the "try title action")

In the third action, the LaRaces again sued the present defendant Wells Fargo and its loan servicer, Ocwen Loan Servicing, LLC, ("Ocwen") this time in Superior Court, seeking damages for wrongful foreclosure, violation of G. L. c. 93A, and slander of title. (the "Superior Court action") The LaRaces' three-count complaint was dismissed by the Superior Court on statute of limitations grounds, and that decision was affirmed by the Appeals Court on February 5, 2018. LaRace v. Wells Fargo Bank, N.A., Trustee, 92 Mass. App. Ct. 1126 (2018) (Rule 1:28 Decision).

On June 29, 2018, the LaRaces filed the present action, repeating their failed claims against Wells Fargo and Ocwen, among others, [Note 1] for violation of G. L. c. 93A and for slander of title (counts IV and V); and also asserting (1) a declaratory judgment count seeking a determination that Wells Fargo did not establish a proper chain of title to the assignments to show that it was the holder of the mortgage at the time of the foreclosure and that it should be required to seek a judicial determination concerning its status as holder of the mortgage before it could go forward with a foreclosure (count I); (2) a count claiming that Wells Fargo had failed to certify its chain of title to the note as well as to the mortgage (count II); (3) a count seeking a determination that the mortgage was an obsolete mortgage beyond the statutory limitations period set forth in G. L. c. 260, § 33 (count III); (4) a count seeking a determination that Wells Fargo does not hold the note and therefore cannot foreclose on the mortgage (second count VI) [Note 2]; and finally, (5) count VII, which seeks to quiet the plaintiffs' title pursuant to G. L. c. 240, §§ 6- 10, alleging the same deficiencies in the chain of assignments to the mortgage alleged in the other counts.

The plaintiffs (and their present counsel), who were aware at least several weeks earlier of the foreclosure sale scheduled for their property for July 3, 2018, filed this action on June 29, 2018, and asked for a hearing on July 3, 2018, the same date as the scheduled sale, on their prayer for a preliminary injunction to enjoin the foreclosure sale. The court denied their request for injunctive relief when they failed to make service on Wells Fargo prior to the hearing.

At a case management conference held on August 18, 2018, I dismissed counts IV and V of the complaint, making claims for damages pursuant to G. L. c. 93A and for slander of title, on subject matter jurisdiction grounds. Counsel for the plaintiffs did not disclose to the court, nor was present counsel for Wells Fargo apparently aware, that the same claims by the same plaintiffs against the same defendant had been disposed of finally by the Appeals Court on statute of limitations grounds just a few months earlier.

On May 10, 2019, I heard the parties' arguments on Wells Fargo's and Ocwen's motion for summary judgment and took the matter under advisement. For the reasons stated below, Wells Fargo's and Ocwen's motion for summary judgment will be ALLOWED, and the plaintiffs' request that summary judgment be entered in their favor will be DENIED. Also for reasons discussed below, plaintiffs' counsel will be ordered to show cause why he should not be sanctioned for violation of Mass. R. Civ. P. 11 in connection with the refiling of the G. L. c. 93A and slander of title claims that had been fully adjudicated in the Superior Court action.

FACTS

The material undisputed facts pertinent to this motion for summary judgment are as follows:

1. The LaRaces purchased 6 Brookburn Street in Springfield (the "Property") pursuant to a deed dated May 16, 2005, recorded in the Hampden County Registry of Deeds ("Registry") on May 19, 2005 in Book 15029, Page 504.

2. In connection with their purchase of the Property, the LaRaces executed two promissory notes and two mortgages securing the notes: a note for $103,200 payable to Option One Mortgage Corporation ("Option One") dated May 19, 2005, secured by a mortgage with the same date granted to Option One, encumbering the Property, and recorded with the Registry in Book 15029, Page 507; ("first mortgage") and a note for $25,800.00 payable to Option One, secured by a mortgage dated May 19, 2005, recorded with the Registry in Book 15029, Page 517.

3. The first mortgage includes the following language on its first page: "This debt is evidenced by Borrower's note dated the same date as this Security Instrument ("Note"), which provides for monthly payments, with the full debt, if not paid earlier, due and payable on June 01, 2035."

4. Through two off-record assignments, from Option One to Bank of America, and then from Bank of America to Wells Fargo, the first mortgage was transferred into a pooling and servicing agreement, of which Wells Fargo was the trustee, on October 1, 2005.

5. On July 5, 2007, Wells Fargo conducted the foreclosure sale of the Property at which it purchased the Property. This is the foreclosure sale that was later invalidated by the Land Court and was the subject of Ibanez.

6. On May 7, 2008, Option One executed an assignment of the first mortgage on the Property to Wells Fargo, which stated on its face that it had an "effective date" of April 18, 2007. This assignment was recorded with the Registry on May 12, 2008 in Book 17291, Page 84. It was this assignment that the Land Court ruled, as affirmed by the SJC in Ibanez, could not retroactively serve as a basis for Wells Fargo's assertion that it held the first mortgage as of the date of the July 5, 2007 foreclosure sale.

7. On March 7, 2012, Sand Canyon Corporation, f/k/a Option One Mortgage Corporation, executed a "Confirmatory Assignment" of the first mortgage on the Property to Wells Fargo. The Confirmatory Assignment was recorded with the Registry on March 14, 2012 in Book 19162, Page 129.

8. On August 24, 2017 Wells Fargo filed an action under the Servicemembers Civil Relief Act and received a judgment declaring that Mark LaRace was not entitled to the benefits of the Act on December 12, 2017.

9. On September 1, 2017, Wells Fargo recorded a facially compliant and valid affidavit of compliance with G. L. c. 244, § 35B, with the Registry in Book 21843, Page 477.

10. On September 1, 2017, Wells Fargo recorded a facially compliant and valid affidavit regarding the note secured by the mortgage to be foreclosed pursuant to G. L. c. 244, § 35C.

11. Wells Fargo conducted a foreclosure sale of the Property on July 3, 2018, and purchased the Property pursuant to a foreclosure deed dated August 28, 2018 and recorded with the Registry on August 28, 2018 in Book 22333, Page 260.

12. On August 28, 2018, Wells Fargo recorded a facially compliant and valid affidavit certifying that on the relevant dates, Wells Fargo was the holder of the promissory note secured by the first mortgage on the Property.

DISCUSSION

"Summary judgment is granted where there are no issues of genuine material fact, and the moving party is entitled to judgment as a matter of law." Ng Bros. Constr. v. Cranney, 436 Mass. 638 , 643-644 (2002); Mass. R. Civ. P. 56 (c). "The moving party bears the burden of affirmatively showing that there is no triable issue of fact." Ng Bros. Constr., supra, 436 Mass. at 644. In determining whether genuine issues of fact exist, the court must draw all inferences from the underlying facts in the light most favorable to the party opposing the motion. See Attorney Gen. v. Bailey, 386 Mass. 367 , 371, cert. denied, 459 U.S. 970 (1982). Whether a fact is material or not is determined by the substantive law, and "an adverse party may not manufacture disputes by conclusory factual assertions." See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Ng Bros. Constr., supra, 436 Mass. at 648. When appropriate, summary judgment may be entered against the moving party and may be limited to certain issues. Community Nat'l Bank v. Dawes, 369 Mass. 550 , 553 (1976); Mass. R. Civ. P. 56 (c).

I. THE PLAINTIFFS' CLAIMS ARE BARRED BY THE DOCTRINE OF RES JUDICATA.

As is noted above, in 2012, the LaRaces filed a try title action in Land Court, later removed to U. S. District Court, in which they sought to compel Wells Fargo to defend the validity of the assignments pursuant to which it claimed to hold the first mortgage to the Property. The LaRaces claimed, among other arguments, that an assignment of the mortgage on the Property to Wells Fargo had been declared invalid by the Supreme Judicial Court in Ibanez, In dismissing the LaRaces' claims, the court pointed out that the SJC had done no such thing: "The SJC did not rule on the question of whether the assignment after the [original] foreclosure was invalid." LaRace v. Wells Fargo Bank, N.A., supra, 972 F. Supp. 2d at 153 (emphasis in original). This dismissal was issued on September 24, 2013.

Barely waiting for the ink to dry on the U. S. District Court dismissal, and without waiting for the resolution of the case on appeal, which resulted in an affirmance of the dismissal, on January 4, 2014 the LaRaces, through their present counsel, filed an action seeking damages for three enumerated torts arising from the same facts, against Wells Fargo in Superior Court. [Note 3] These were claims for wrongful foreclosure, violation of G. L. c. 93A, and slander of title, all based on the earlier foreclosure that the SJC had declared invalid in Ibanez because Wells Fargo did not hold the mortgage at the time of the foreclosure. These claims were dismissed by the Superior Court on the grounds that they were barred by the applicable statute of limitations. The dismissal was affirmed by the Appeals Court on February 5, 2018. LaRace v. Wells Fargo Bank, N.A., Trustee, 92 Mass. App. Ct. 1126 (Rule 1:28 Decision).

The LaRaces, with the same counsel, filed the present complaint on June 29, 2018, making a series of claims relating to the invalidity of the assignments through which Wells Fargo claimed ownership of the mortgage on the Property, and also making G. L. c. 93A and slander of title claims. The G. L. c. 93A and slander of title claims were based on assertions that the LaRaces were damaged by Wells Fargo's having proceeded with the original foreclosure, later determined to be invalid by the SJC in Ibanez. These are the same assertions dismissed by the Superior Court, later affirmed by the Appeals Court, on statute of limitations grounds. The G. L. c. 93A and slander of title claims in the present complaint were also based at least in part on the LaRaces' allegations that the assignment through which Wells Fargo claims to be the holder of the mortgage was "a legally invalid 'assignment of mortgage,'" declared to be so by the SJC in Ibanez. These allegations were made despite the U. S. District Court having explicitly held (as did the SJC) that the SJC did not rule that the assignment was invalid, but rather that the original foreclosure was invalid because the assignment post-dated the foreclosure.

A. Issue Preclusion

"Res judicata is the generic term for various doctrines by which a judgment in one action has a binding effect in another." Heacock v. Heacock, 402 Mass. 21 , 23, n. 2 (1988). The doctrines of "issue preclusion" and "claim preclusion" are encompassed within the term "res judicata." Kobrin v. Bd. of Registration in Med., 444 Mass. 837 , 843 (2005). Issue preclusion "prevents relitigation of an issue determined in an earlier action where the same issue arises in a later action, based on a different claim, between the same parties or their privies." Heacock v. Heacock, supra, 402 Mass. at 23, n.2. "In order to preclude a party from relitigating an issue the court must conclude that (1) there was a final judgment on the merits in the prior action, (2) the party against whom preclusion is asserted was a party to that final judgment, (3) the issue in the prior litigation was identical to the current issue, and (4) the issue in the prior litigation was essential to the judgment and actually litigated." Hauer v. Casper, 20 LCR 125 , 129 (Mass. Land Court 2012) (Grossman, J.), quoting Kobrin v. Bd. of Registration in Medicine, supra, 444 Mass. at 843-844; see also Petrillo v. Zoning Bd. of Appeals of Cohasset, 65 Mass. App. Ct. 453 , 457 (2006).

"The doctrine of res judicata precludes relitigating not only the issues raised in the prior action, but the issues that could have been raised." Brennan v. Harmon Law Offices, P.C., 81 Mass. App. Ct. 1125 (2012), citing Anderson v. Phoenix Inv. Counsel of Boston, Inc., 387 Mass. 444 , 449 (1982); Baby Furniture Warehouse Store, Inc. v. Muebles D&F Ltée, 75 Mass. App. Ct. 27 , 35 (2009). "The rule of res judicata is designed to forestall a plaintiff from getting 'two bites at the apple.'" Anderson v. Phoenix Inv. Counsel of Boston, Inc., supra, 387 Mass. at 452. To the extent the plaintiffs failed to assert legal claims or theories that could have been asserted in the try title action or the Superior Court action, the court "cannot countenance a plaintiff's action in failing to plead a theory in [one case] in the hope of later litigating the theory in [another case]." Id.

Identity of the parties and issues. There is no dispute that the parties in all three cases, the try title action, the Superior Court action, and the present action, are exactly the same. In all three cases, the LaRaces were the plaintiffs, and Wells Fargo, in its same capacity as trustee of the same pooling and servicing trust, was one of the defendants.

The common thread running through all three of the cases following the Ibanez decision is the LaRaces' claim that Wells Fargo does not hold the mortgage to their property because of claimed defects in the chain of assignments of the mortgage. This issue is the basis for the LaRaces' claims in both the try title action ultimately decided in the federal courts, and the later Superior Court action, and it is the basis of the LaRaces' claims in the present action. In addition, the LaRaces, in the present action, have repeated tort claims that are identical to claims they made in the Superior Court action. Under these circumstances, identity of both the parties and the issues is established. To the extent the LaRaces formulated different legal theories to advance their claim based on this issue, they are barred from advancing new legal theories that could have been asserted in the earlier actions by the holdings of Brennan v. Harmon Law Offices, P.C., 81 Mass. App. Ct. 1125 (2012), and Anderson v. Phoenix Inv. Counsel of Boston, Inc., 387 Mass. 444 , 449 (1982), both cited above.

Whether the issue was essential and was actually litigated. "In determining whether an issue was actually litigated for preclusion purposes, courts ask whether the issue was 'subject to an adversary presentation and consequent judgment that was not a product of the parties' consent.'" Martinez v. Waldstein, 89 Mass. App. Ct. 341 , 345 (2016), quoting Jarosz v. Palmer, 436 Mass. 526 , 531 (2002). The appropriate question is whether the issue was presented to the adverse party with a full and fair opportunity to litigate the issue the first time, or whether other circumstances justify affording the party an opportunity to relitigate the issue. See Comm'r of the Dep't of Employment & Training v. Dugan, 428 Mass. 138 , 143 (1998); Green v. Brookline, 53 Mass. App. Ct. 120 , 123 (2001); Alba v. Raytheon Co., 441 Mass. 836 , 844 (2004).

As long as the party who should have had an interest in litigating the issue in the first case had an ample opportunity to do so, that party may not relitigate the issue in a later case. "[I]t (is) unnecessary…to determine whether [the] claim was actually presented in [the earlier case] because…we believe that this claim was capable of being raised in [the earlier case] and should have been raised in the context of that case." Bagley v. Moxley, 407 Mass. 633 , 638 (1990). That is the case here, with respect to legal claims actually raised by the LaRaces in the two earlier cases in which they were the plaintiffs, and with respect to claims they could have raised in those cases. In the earlier try title action, for instance, the LaRaces could have, but failed to, assert a count for declaratory judgment in addition to the try title count with respect to their claim that Wells Fargo failed to prove that it legitimately held the mortgage. The court even pointed this out in its decision. LaRace v. Wells Fargo Bank, N.A., supra, 972 F. Supp. 2d at 154, n. 3.

There was also nothing preventing the LaRaces from asserting in the try title action other counts to advance the various other legal theories they have asserted in the present action. The only explanation for their failure to do so is that they wished to impermissibly hedge their bets so that they could, if necessary, seek a second (or even third) bite at the apple.

"[I]t was incumbent on the plaintiffs to present to the court [in the earlier case] all of the legal theories on which they based their claim…The plaintiffs were not entitled to pursue their claim…through piecemeal litigation, offering one legal theory to the court while holding others in reserve for future litigation should the first theory prove unsuccessful." Bagley v. Moxley, supra, 407 Mass. at 638. Like the plaintiffs in Bagley v. Moxley, who impermissibly sought to litigate their claims of ownership of a private way one theory at a time in successive lawsuits, the plaintiffs in the present action have impermissibly sought to reserve different theories of their successive challenges to the validity of the chain of assignments of the mortgage.

Finality of the two earlier decisions. In order for res judicata to apply, the prior action must be a final judgment on the merits. Kobrin v. Bd. of Registration in Med., supra, at 843-844. Both the try title action, after removal to U. S. District Court, and the Superior Court action, were dismissed, one for failure to state a claim under the try title statute, and the other on statute of limitations grounds. Both dismissals were appealed by the LaRaces and resulted in appellate decisions affirming the dismissals. There is no question but that these were adjudications resulting in final judgments and constituted judgments on the merits.

B. Claim Preclusion

The related doctrine of claim preclusion also bars the present assertion of the tort counts already dismissed by the court on subject matter jurisdiction grounds. As is noted above, the counts asserting claims of violation of G. L. c. 93A and slander of title are the same as the claims raised and dismissed in the Superior Court action. [Note 4] "Three elements are essential for invocation of claim preclusion: (1) the identity or privity of the parties to the present and prior actions, (2) identity of the cause of action, and (3) prior final judgment on the merits." DaLuz v. Dep't of Correction, 434 Mass. 40 , 45 (2001); Franklin v. North Weymouth Coop. Bank, 283 Mass. 275 , 280 (1933). However, the present cause of action "need not be a clone of the earlier cause of action" to invoke claim preclusion. Mancuso v. Kinchla, 60 Mass. 558 , 571 (2004); Massachusetts Sch. of Law at Andover, Inc. v. American Bar Assn., 142 F. 3d 26, 38 (1st Cir. 1998).

For the reasons stated above, the doctrine of claim preclusion bars relitigation of the LaRaces' counts for violations of G. L. c. 93A and for slander of title. Accordingly, those counts will be dismissed with prejudice, and not without prejudice as would be the case if they had been dismissed solely for lack of subject matter jurisdiction.

II. THE PLAINTIFFS' CLAIMS FAIL ON THE MERITS.

A. Wells Fargo Holds the Mortgage Pursuant to a Clear and Unbroken Chain of Assignments.

The LaRaces' theory of liability in Counts I and VII of their complaint appears to be that Wells Fargo did not hold the mortgage at the time of the July 3, 2018 foreclosure sale of the Property. First of all, as is noted above, the plaintiffs misconstrue the holding in Ibanez when they assert that the Land Court and SJC held in Ibanez that the 2008 assignment was void. The holding in Ibanez was that the 2008 assignment could not support a finding that Wells Fargo held the mortgage at the time of the 2007 foreclosure sale because it post-dated the sale. This did not mean that the assignment would be invalid to effect a transfer of the mortgage to Wells Fargo for a future foreclosure. At the time of the 2008 assignment, Option One could validly assign the mortgage to Wells Fargo (in effect, recognizing the off-record assignment that had already taken place by placing the mortgage into the pooling and servicing agreement) and could validly issue a confirmatory assignment in 2012. Those assignments can and do demonstrate the successful transfer of the mortgage to Wells Fargo.

The LaRaces' argument that the assignments were ineffective to transfer title to the mortgage to Wells Fargo is the only argument that, if established, would potentially support plaintiffs' claim. "[A] mortgagor's standing [is] limited to claims that a defect in the assignment rendered it void, not merely voidable." Bank of New York Mellon Corp. v. Wain, 85 Mass. App. Ct. 498 , 502 (2014). Plaintiffs' remaining claims are of the variety that, if established, would render the foreclosure voidable, and do not affect the validity of a foreclosure, like the one in the present action, that has already occurred.

B. Wells Fargo Need Not Establish a Chain of Title for the Note.

The gravamen of Count II of the complaint is that Wells Fargo, in addition to not having a valid chain of title to the first mortgage, has failed to show an unbroken chain of title to the promissory note secured by the first mortgage. As this court has ruled in another case involving the same argument made by plaintiffs' present counsel, no such showing is necessary. In Count VI (the second Count VI), the LaRaces argue as well that Wells Fargo either does not have possession of the note or otherwise lacks the authority to enforce the note, and therefore could not foreclose on the mortgage.

"[A] foreclosing mortgage holder…may establish that it either held the note or acted on behalf of the note holder at the time of a foreclosure sale by filing an affidavit in the appropriate registry of deeds pursuant to G. L. c. 183, § 5B." This was done by way of the affidavit filed with the Registry on August 28, 2018, and this disposes of both Counts II and VI.

The LaRaces' nevertheless argue, that under 209 C.M.R. § 18.21A(2)(c), [Note 5] and G. L. c. 183, § 21 and G. L. c. 244, § 14, Wells Fargo must show not only that it held the note at the time of foreclosure, but that it must also demonstrate the chain of title for the promissory note in order to have the legal authority to foreclose. With respect to the mortgage, as opposed to the promissory note, a mortgagee must show "a complete chain of assignments linking it to the record holder of the mortgage, or a single assignment from the record holder of the mortgage." U.S. Bank Nat'l Assn. v. Ibanez, supra, 458 Mass. at 637.

However, there is no such requirement to show a full chain of title for the promissory note secured by the mortgage. In Sullivan v. Kondaur Capital Corp., the court held, "nothing in Massachusetts law requires a foreclosing mortgagee to demonstrate that prior holders of the record legal interest in the mortgage also held the note at the time each assigned its interest in the mortgage to the next holder in the chain." 85 Mass. App. Ct. 202 , 210 (2014). Moreover, accepting plaintiff's argument would represent a "significant expansion of the Eaton rule, insofar as [it would] suggest that a 'mortgagee' must hold both legal and equitable interest in the loan not only at the time of foreclosure but at the time of any previous transfers of the recorded mortgage interest." Id. at 209-210.

The LaRaces argue that 209 C.M.R § 18.21A, 2C, which contains language requiring "certification of the chain of title and ownership of the note and mortgage," requires that a chain of title must be demonstrated for both the note and mortgage. But "certification of the chain of title" and "ownership of the note and mortgage" are two separate concepts; chain of title is necessarily a reference to showing the chain of title only to the mortgage, because only mortgage assignments are recorded, and showing the chain of title of assignments of the mortgage is the only way to demonstrate that the foreclosing entity is the current holder of the mortgage. Promissory notes, on the other hand, are never recorded, and ownership of a note is demonstrated by an endorsement on the note itself; it is not necessary to demonstrate a chain of title or to even identify past holders of a note in order to provide evidence that one is the current holder of the note, because the chain is demonstrated by the endorsements on the note itself and are self-evident. Physically holding the note, along with an endorsement of the note either in blank or to the holder, is sufficient. The Eaton court noted the impractibility of requiring disclosure of a chain of title for promissory notes, by pointing out that "there are no…provisions for recording mortgage notes; and as a result, clear record title cannot be ascertained because the validity of any prior foreclosure sale is not ascertainable by examining documents of record." Eaton, supra, 462 Mass. at 586. In its holding, the Eaton court did not change this reality or the rules relating to proof of ownership of a promissory note. Accordingly, the provision in 209 C.M.R § 18.21A(2)(c) for "certification of the chain of title and ownership of the note and mortgage," cannot be construed reasonably to require demonstration of a chain of title for a promissory note where the Supreme Judicial Court has acknowledged that under our system no such requirement is required or even possible, let alone necessary.

The court thus construes the regulation as requiring, consistent with Eaton, certification of the chain of title of mortgage assignments, and certification of ownership of the note. To the extent the regulation could be construed to require more than that with respect to the note, it would be ultra vires. See Massachusetts Federation of Teachers, AFT, AFL-CIO v. Bd. of Education, 436 Mass. 763 , 773 (2002) (noting that in promulgating regulations, "the agency may not exceed those powers and obligations expressly conferred on it by statute or reasonably necessary to carry out the purposes for which the statute was enacted").

C. The Obsolete Mortgage Statute Does Not Render the Mortgage Unenforceable.

Count III of the complaint is a claim that the limitations periods in G. L. c. 260, § 33, the "Obsolete Mortgage Statute," render the first mortgage unenforceable. G. L. c. 260, § 33 provides in relevant part:

A power of sale in any mortgage of real estate shall not be exercised and an entry shall not be made nor possession taken nor proceeding begun for foreclosure of any such mortgage after the expiration of, in the case of a mortgage in which no term of the mortgage is stated, thirty-five years from the recording of the mortgage or, in the case of a mortgage in which the term or maturity date of the mortgage is stated, five years from the expiration of the term or from the maturity date, unless an extension of the mortgage, or an acknowledgment or affidavit that the mortgage is not satisfied, is recorded before the expiration of such period.

The statutory language is unambiguous, and whether there is a maturity date stated in the mortgage is crucial in determining which limitations period, five years or thirty-five years, applies to the mortgage. See Harvard 45 Assocs., LLC v. Allied Props. & Mtges., Inc., 80 Mass. App. Ct. 203 , 208 (2011) (holding that mortgage providing on its face that it was to be due and payable on August 31, 2001 is subject to a 5-year limitations period). Any change in the maturity date, to effect a change in the statutory enforceability period, must be recorded. See Housman v. LBM Fin., LLC, 80 Mass. App. Ct. 213 , 216 (2011) (extension in maturity date must be recorded to be effective).

The LaRaces acknowledge that the mortgage states a maturity date on the face of the mortgage as follows: "This debt is evidenced by Borrower's note dated the same date as this Security Instrument ("Note"), which provides for monthly payments, with the full debt, if not paid earlier, due and payable on June 01, 2035." The LaRaces do not assert that any amendment to the mortgage or other change in this stated maturity date was recorded at the Registry. However, the LaRaces argue that by accelerating the note upon the LaRaces' default sometime prior to the 2007 foreclosure sale, the maturity date was changed for purposes of G. L. c. 260, § 33. There is no support for the LaRaces' argument, and the law is otherwise.

The term or maturity date of an underlying obligation can become the term or maturity date of the mortgage only when "stated on the face of the mortgage." Deutsche Bank v. Fitchburg Capital, LLC, supra 471 Mass. 248 , 257 (2015). The idea of forcing a mortgage holder or others to search for off-record sources of the maturity date of the mortgage, as urged by the LaRaces, was rejected in the decision affirmed by the SJC in Deutsche Bank. Basing a maturity date, for statute of limitations purposes, only on a date that is clearly set forth on the face of the mortgage itself, instead of forcing the mortgage holder to search for this information outside the record title, creates "a greater level of certainty and consistency for members of the public." Deutsche Bank Nat'l Trust Co. v. Fitchburg Capital, LLC, 21 LCR 559 , 563 (Mass. Land Ct. 2013) (Foster, J.), aff'd Deutsche Bank v. Fitchburg Capital, LLC, supra, 471 Mass. 248 . Furthermore, the requirement that the term be stated on the face of the mortgage "ensures that the enforcement period is clear from the record, affording the discharge process greater efficiency." Id.

III. ORDER TO SHOW CAUSE REGARDING G. l. c. 93A AND SLANDER OF TITLE COUNTS.

Mass. R. Civ. P. 11 provides in relevant part as follows: "The signature of an attorney to a pleading constitutes a certificate by him that he has read the pleading; that to the best of his knowledge, information, and belief there is a good ground to support it; and that it is not interposed for delay... For a wilful violation of this rule an attorney may be subjected to appropriate disciplinary action." "'Good ground' requires that the pleadings be based on 'reasonable inquiry and an absence of bad faith.'" Doe v. Nutter, McClennan & Fish, 41 Mass. App. Ct. 137 , 142 (1996), quoting in part Bird v. Bird, 24 Mass. App. Ct. 362 , 368 (1987). It is within the proper exercise of the trial judge's discretion, "applying his sense of the entire case," to decide whether there has been "bad faith misuse of a court paper which could bring down sanctions." Id. at 369.

As is discussed above, I have found that counts IV and V of the complaint in the present action, stating purported claims for violation of G. L. c. 93A and slander of title, are the same claims fully litigated in the Superior Court action. These claims were litigated through a dispositive appeal to the Appeals Court, resulting in an appellate decision affirming the dismissal of the claims on statute of limitations grounds. Furthermore, the claims are not only the same claims legally and factually, but the present counts IV and V are nearly verbatim copies of the dismissed claims in the earlier Superior Court action. Present counsel for the LaRaces, who signed the complaint in the present action, was also counsel for the LaRaces who signed the complaint in the Superior Court action. Accordingly, it appears that counsel, being aware of a final adjudication of these claims adversely to his clients, chose to assert them in a new action notwithstanding their final adverse adjudication. Furthermore, counsel failed to disclose to the court that these claims had been the subject of previous litigation. This is not the first time that present counsel has engaged in similar conduct. [Note 6]

Upon a finding of a violation of Mass. R. Civ. P. 11, a court is authorized to impose an award of attorneys' fees against counsel committing the violation. Tilman v. Brink, 74 Mass. 845 , 851 (2009). See also, Van Christo Advertising, Inc v. M/A-COM/LCS, 426 Mass. 410 , 416 (1998) (Rule 11 authorizes the court "to impose attorney's fees and costs where an attorney has failed to show a subjective good faith belief that the pleading was supported in both fact and law."). Accordingly, counsel will be ordered to show cause why he should not be sanctioned for violating Rule 11 as outlined above.

CONCLUSION

For the reasons stated above, Wells Fargo's and Ocwen's motion for summary judgment is ALLOWED, and the plaintiffs' request that summary judgment be entered in their favor is DENIED.

It is further ORDERED that counsel for the plaintiffs appear before the court on Monday, June 3, 2019 at 10:00 to show cause why he should not be sanctioned pursuant to Rule 11 for the reasons described herein. Any written submissions in connection with the order to show cause are to be filed no later than May 29, 2019.

Judgment will enter in accordance with this Decision.