FEDERAL NATIONAL MORTGAGE ASSOCIATION, Plaintiff v. LOUIS CHALLENGER and CITIZENS BANK, NATIONAL ASSOCIATION, Defendants

This matter is before the court in the unusual posture of being a motion for approval of an agreement for judgment that, although executed on behalf of the defendant Louis Challenger, is opposed by him on the grounds that the circumstances of the signing and the holding in escrow of the agreement for judgment justify consideration by the court of something less than full approval, which entails, essentially, permission by the court to release the agreement for judgment from escrow so that it may be filed.

The agreement for judgment itself accomplishes the main goal of the plaintiff in this litigation, in that it allows, with the agreement of the defendant, the reformation of the 2006 mortgage executed by the defendant's late wife, so that the defendant's interest in the subject property is also subject to the mortgage. The parties have agreed as well, that upon the sale or refinancing of the property within a specified time frame, the plaintiff would accept a discounted payoff of the mortgage, accomplished by refinance, or, more likely, sale of the property, thus allowing the defendant to capture sufficient equity in order to allow him to find and acquire a new residence. Given delays caused by the corona virus pandemic, by the defendant contracting Covid-19, and by the collapse of an anticipated sale of the property, the time frames agreed to by the parties have not been met, and the parties have yet to agree on an extension.

The defendant argues that the parts of the parties' agreement that allow for foreclosure, or for the recording of a release deed executed by the defendant, and held in escrow by the plaintiff, would violate the current state and federal prohibitions on mortgage foreclosures. The court does not reach those defenses; instead, the court finds, on the unique circumstances present in this action, that the equities require a tolling of certain parts of the parties' agreement for a limited period of time.

Accordingly, it is

ORDERED that the plaintiff Federal National Mortgage Association's Motion for Approval of Agreement for Judgment is ALLOWED; and it is further

ORDERED that the Stipulation and Agreement for Judgment dated October 31, 2019, is APPROVED in accordance with Land Court Rule 10, except as provided in the following paragraph, and it is further

ORDERED that the Stipulation and Agreement for Judgment and the Judgment proposed by the parties and submitted as Exhibit A with the Stipulation and Agreement for Judgment, although binding on the parties as an agreement for judgment, shall not become the judgment of the court nor shall the proposed Judgment be accepted for filing until further order of court; and it is further

ORDERED that the plaintiff Federal National Mortgage Association is ENJOINED from foreclosing on the subject property or recording the executed Release Deed without further order of court; and it is further

ORDERED that this matter shall be set down for a status conference on Tuesday, December 1, 2020, at 9:30 A.M,

So Ordered.