United States District Court, D. Massachusetts
HMC ASSETS, LLC SOLELY IN ITS CAPACITY AS SEPARATE TRUSTEE OF CAM MORTGAGE TRUST 2013-1, Plaintiff,
MARION R. CONLEY, Defendant.
AND ORDER MOTION TO STRIKE THE AFFIDAVIT OF RENEAU LONGORIA
(DOCKET ENTRY # 80); MOTION TO STRIKE THE AFFIDAVIT OF GARY
MCCARTHY (DOCKET ENTRY # 70); PLAINTIFF HMC ASSETS, LLC
SOLELY IN ITS CAPACITY AS SEPARATE TRUSTEE OF CAM MORTGAGE
TRUST 2013-1’S MOTION FOR SUMMARY JUDGMENT (DOCKET
ENTRY # 59)
MARIANNE B. BOWLER JUDGE
before this court is a motion for summary judgment filed by
plaintiff HMC Assets, LLC Solely in its Capacity as Separate
Trustee of CAM Mortgage Trust 2013-1 (“plaintiff,
” “Home Assets” or “HMC as CAM
Mortgage”) against defendant Marion R. Conley
(“defendant”). (Docket Entry # 59). Defendant
opposes the motion and separately moves to strike affidavits
submitted in support of the motion for summary judgment.
(Docket Entry ## 70 & 80). After conducting a hearing,
this court took the motions (Docket Entry ## 59, 70, 80)
April 18, 2014, plaintiff filed an amended complaint that
sets out the following counts: (1) breach of contract due to
defendant’s default on a loan and mortgage payments
(Count I); (2) declaratory judgment that a March 7, 2014
foreclosure on the 23 Golf View Drive, Nantucket,
Massachusetts property (“the property”) was valid
(Count II); (3) deficiency judgment for the total amount of
defendant’s debt owed to plaintiff (Count
III);(4) judgment of possession of the property
(Count IV); (5) use and occupancy payments for the period of
time after the foreclosure (Count V); and (6) writ of
assistance from the court to enforce the judgment (Count VI).
(Docket Entry # 11).
October 2, 2015, plaintiff filed the summary judgment motion
pursuant to Fed.R.Civ.P. 56 (“Rule 56”) on all
claims in the amended complaint and on defendant’s
counterclaim. (Docket Entry # 59). Plaintiff argues that it
acquired title to the property pursuant to a lawful
foreclosure sale and that the foreclosure was conducted in
strict compliance with Massachusetts law thus giving
plaintiff standing to foreclose. (Docket Entry # 60). The
counterclaim set out seven counts. Counts two through seven
respectively assert claims for breach of contract, breach of
the implied covenant of good faith and fair dealing,
negligence, unlawful foreclosure, an accounting and violation
of Massachusetts General Laws chapter 93A (“chapter
93A”). Count One seeks relief under Massachusetts
General Laws chapter 185, section 114. Defendant opposes the
motion. (Docket Entry # 68).
after filing the opposition to the summary judgment motion
(Docket Entry # 68), defendant filed two motions to strike
affidavits submitted by plaintiff (Docket Entry ## 70, 80).
Defendant argues that the affidavits submitted by plaintiff
(Docket Entry ## 62, 63, 63-11 & 73) are inadmissible
because they are not based on personal knowledge and
therefore constitute inadmissible hearsay. (Docket Entry ##
defendant asserts that exhibits submitted with the affidavits
do not meet the business record exception under Fed.R.Evid.
803(6)(A) and that the affidavits made by plaintiff’s
counsel (Docket Entry ## 62, 73) do not satisfy the qualified
witness requirement under Fed.R.Evid. 803(6). (Docket Entry
## 70, 80). Defendant requests that this court strike the
challenged affidavits and all of their associated exhibits
from the summary judgment record and award plaintiff
attorney’s fees and costs in bringing the motions.
(Docket Entry ## 70, 80). Plaintiff opposes the motions to
strike. (Docket Entry ## 71, 81).
Motions to Strike
motion to strike is the appropriate means of objecting to the
use of affidavit evidence on a motion for summary
judgment.” See Facey v. Dickhaut, 91 F.Supp.3d
12, 19 (D.Mass. 2014). Furthermore, Rule 56(c)(4) states that
“[a]n affidavit or declaration used to support or
oppose a motion must be made on personal knowledge, set out
facts that would be admissible in evidence, and show that the
affiant or declarant is competent to testify on the matters
stated.” Fed.R.Civ.P. 56(c)(4). “If evidence
cannot be presented in a form that would be admissible at
trial, the court may not rely on it.” Facey v.
Dickhaut, 91 F.Supp.3d at 19.
establish an acceptable affidavit, the affiant should testify
that he was somehow personally involved in the events for
which he is testifying and not base his testimony upon
out-of-court statements made for the truth of the matter
asserted. See Fed.R.Evid. 802; Perez v. Lorraine
Enterprises, Inc., 769 F.3d 23, 31 (1st Cir.
2014); Garside v. Osco Drug, Inc., 895 F.2d 46,
49-50 (1st Cir. 1990). Personal knowledge is
satisfied when the statements made by the affiant are based
in fact “as opposed to conclusions assumptions, or
surmise.” Perez v. Volvo Car Corp., 247 F.3d
303, 316 (1st Cir. 2001) (internal citation
Rule 56 “requires a scalpel not a butcher knife. The
nisi prius court ordinarily must apply it to each
segment of an affidavit, not to the affidavit as a
whole.” Perez v. Volvo Car Corp., 247 F.3d at
315. The First Circuit in Perez instructs that a
selective approach should be taken when determining the
admissibility of an affidavit, “intending to disregard
those parts of it that are inadmissible and to credit the
remaining portions.” Id.
the motions to strike bear on the evidence that this court
will consider in deciding plaintiff’s motion for
summary judgment, they shall be considered first. See
Facey v. Dickhaut, 91 F.Supp.3d at 19. First, defendant
has moved to strike the affidavit of Gary McCarthy
(“McCarthy affidavit”) as well as the exhibits
attached to the affidavit. (Docket Entry # 70). Defendant
argues that the affidavit was not based on the personal
knowledge of the affiant, Gary McCarthy
(“McCarthy”), and therefore constitutes
inadmissible hearsay. (Docket Entry # 70). Defendant further
contends that the McCarthy affidavit lacks statements of fact
and instead contains baseless and conclusory assumptions that
lack a proper foundation and do not support the possible
knowledge of the affiant. (Docket Entry # 70).
pointed out by plaintiff, McCarthy states that he made the
affidavit on the basis of his personal knowledge. (Docket
Entry # 63). Additionally, McCarthy, a member of Home Assets,
attests in the affidavit that he personally reviewed the
servicing records for the Nantucket property, which were
prepared in the ordinary course of business of BSI Financial
Services (“BSI”). (Docket Entry # 63). Plaintiff
submits that the McCarthy affidavit and its attachments
satisfy the foundational requirements for the business
records exception to the hearsay rule and that the
foreclosure affidavit of Manuel Villegas
(“Villegas”) satisfies the requirements of
Massachusetts General Laws chapter 244 (“chapter
244”), section 15. (Docket Entry # 71).
states in the affidavit that he has personal knowledge as a
member of plaintiff’s business. (Docket Entry # 63).
Having worked for plaintiff and reviewed the actual records
of defendant’s mortgage loan, he avered that they were
kept in the ordinary course of business of BSI, the servicer
for Home Assets, and maintained by BSI or Home Assets
employees. (Docket Entry # 63).
argues that McCarthy does not attest to what personal
knowledge he has or how he was able to obtain such personal
knowledge. According to defendant, McCarthy, a manager for
Home Assets, did not have a foundation showing how BSI
“created, kept or maintained” the records.
(Docket Entry # 70).
to prove personal knowledge may consist of the
witness’s own testimony.” Fed.R.Evid. 602.
McCarthy’s own testimony, however, reflects that he was
able to obtain personal knowledge over defendant’s
mortgage loan by explaining that he has been working for
plaintiff for close to five years. (Docket Entry # 63). It is
true that McCarthy, as an employee of Home Assets, is not
qualified to testify about the ordinary course of BSI in
maintaining the records of BSI. Villegas, however, is an
employee of BSI and he submitted an affidavit that satisfies
Rule 803(6) with respect to the records maintained by BSI
including the note history and other business records of BSI
regarding the “servicing and loan payment
histories.” (Docket Entry # 62-6). The court in
Perdomo v. Federal Nat’l Mortg. Ass’n,
2013 WL 1123629, at *2 (N.D. Tex. Mar. 18, 2013), rejected a
similar challenge to an affidavit of an employee of a
servicer in light of her review of the loan records at issue.
Further, notwithstanding defendant’s argument to the
contrary, the fact that McCarthy was an employee of Home
Assets as opposed to BSI does not prevent him from being a
qualified witness. See Phillips v. Mortg. Elec.
Registration Systems, Inc., 2013 WL 1498956, *3
(N.D.Ala. April 5, 2013) (Rule 803(6) “does not require
testimony by some witness associated with the predecessor
entity when the records become part of the records of a
hearsay exception for business records allows admission into
evidence of a record if it was made at or near the time by
someone with knowledge, kept in the ordinary course of
business, made within a regular business activity, and all of
these requirements are shown by a qualified witness of the
records, with no indication of trustworthiness made by the
opponent. Fed.R.Evid. 803(6). In regards to the
“qualified witness” requirement of the business
record exception, “it is well established that the
witness need not be the person who actually prepared the
record. A qualified witness is simply one who can explain and
be cross-examined concerning the manner in which the records
are made and kept. Wallace Motor Sales, Inc. v. American
Motors Sales Corp., 780 F.2d 1049, 1061 (1st
Cir. 1985) (citations omitted); see also United States v.
Kayne, 90 F.3d 7, 12-13 (1st Cir. 1996)
(citing to Wallace that qualifying witness need not
have actually prepared the business record, just that he can
be cross-examined on the matter of how record was made and
argues that McCarthy, despite being an employee of plaintiff,
fails to meet the “qualified witness” requirement
under the business records exception. (Docket Entry # 70). In
the affidavit, however, McCarthy demonstrated a knowledge and
a familiarity with how the loan documents were made with
defendant and how those records were serviced and maintained.
(Docket Entry # 63).
further submits that McCarthy’s attestations are
conclusory. To the contrary, the McCarthy affidavit lays out
factual statements regarding the loan history between
plaintiff and defendant based on McCarthy’s own
personal knowledge as well as his review of the business
records. (Docket Entry # 63). Defendant’s reliance on
Sheinkopf v. Stone, 927 F.2d 1259, 1271
(1st Cir. 1991), is misplaced because in
Sheinkopf the affidavit was deficient due to the
conclusory statements and mere allegations made solely based
on the belief of the affiant.
further asserts that there is no specific evidence about how
the records were created, kept or maintained. (Docket Entry #
70). Yet, an affiant is only required to have some
familiarity and ability to explain the maintenance of the
business records in question, especially when elements of
trustworthiness are present. See Wallace Motor Sales,
Inc. v. American Motors Sales Corp., 780 F.2d at 1061
(citing NLRB v. First Termite Control Co., Inc., 646
F.2d 424, 427 (9th Cir. 1981)); see also
United States v. Kayne 90 F.3d at 12-13. McCarthy refers
to a number of facts regarding the mortgage loan and he
discusses the analysis plaintiff utilizes when assessing the
possibilities for a loan modification as well as the
procedures plaintiff took to engage in a foreclosure sale of
the property. (Docket Entry # 63). Therefore, the McCarthy
affidavit meets all of the necessary requirements under the
business records exception as well as the personal knowledge
requirement for affidavits in support of motions for summary
judgment. Fed.R.Evid. 803(6); Fed.R.Civ.P. 56(c)(4).
also raises two state statutory arguments as a means to
strike documents attached to the McCarthy affidavit. (Docket
Entry # 70). First, defendant states that there is
“[n]o evidence of any contractual relationship”
between plaintiff and BSI “to service Conley’s
loan” thereby “implicating the Statute of
Frauds” in Massachusetts General Laws chapter 259
(“chapter 259”), section one, a writing for the
sale of real estate interests.” (Docket Entry # 70).
The statute of frauds instructs that:
No action shall be brought . . . [u]pon a contract for the
sale of lands . . . or of any interest in or concerning them
. . . [u]nless the promise, contract or agreement upon which
such action is brought, or some memorandum or note thereof,
is in writing and signed by the party to be charged therewith
or by some person thereunto by him lawfully authorized.
Gen. L. ch. 259, § 1 (“chapter 259”).
Accordingly, “as a general matter, ‘a contract
for the sale of land must comply with the Statute of Frauds,
’ and ‘an oral modification will not be enforced
if it results in a “rewriting” of the contract or
significantly changes the parties’
obligations.’” Akar v. Federal Nat’l
Mortg. Ass’n, 845 F.Supp.2d 381, 397 (D.Mass.
2012) (brackets omitted); see Seidel v. Wells Fargo Bank,
N.A., 2012 WL 2571200, at *4 (D.Mass. July 3, 2012)
(“‘right to possession of land is an interest in
it, and a contract to surrender possession or to forbear for
a time to exercise a right to take and retain possession is
within the statute of frauds’”); RFF Family
Partnership, LP v. Link Development, LLC, 907 F.Supp.2d
155, 163 (D.Mass. 2012) (although “Statute of Frauds
prohibits oral contracts for the sale of land, or interests
in the sale of land, oral agreements that alter the method by
which a mortgage is paid off but do not affect the
‘right, title and interest’ in the security are
authority to act on behalf of HMC as CAM Mortgage as a
servicer does not implicate a “contract for the sale of
lands” within the meaning of chapter 259, section one.
See First Pennsylvania Mortg. Trust v. Dorchester Savings
Bank, 481 N.E.2d 1132, 1138 (Mass. 1985); Aragao v.
Mortg. Elec. Registration Systems, Inc., 22 F.Supp.3d
133, 139 n.6 (D.Mass. 2014); Akar v. Federal Nat’l
Mortg. Ass’n, 845 F.Supp.2d at 397; see also
Greenfield v. Pearlstein, 1995 WL 106051, at *2
(Mass.App.Div. Feb. 28, 1995) (statute of frauds
“inapplicable to contracts which do not entail or
contemplate a transfer of land or the creation of any estate
or interest therein and which instead concern the profits or
losses arising from the use or sale of realty”). As a
servicer, BSI did not own the mortgage and its relationship
as a servicer for HMC as CAM Mortgage, the mortgagee and
lender, did not involve the transfer of land. In the
alternative, a limited power of attorney (Docket Entry #
15-2) evidences that BSI had the authority to act as
servicing agent for HMC as CAM Mortgage and satisfy the
statute’s writing requirement. See also Financial
Resources Network, Inc. v. Brown & Brown, Inc., 930
F.Supp.2d 287, 308 (D.Mass. 2013).
other statutory argument relies on Massachusetts General Laws
chapter 233, section 79A (“section 79A”), which
provides for the admissibility of certified copies of public
records. Similar to section 79A, certified and signed copies
of documents of public records are self-authenticating under
the applicable Federal Rule of Evidence, Fed.R.Evid. 902
(“Rule 902”). See Downey v. Bob’s
Discount Furniture Holdings, Inc., 633 F.3d 1, 8
(1st Cir. 2011) (“[f]ederal evidentiary
rules govern in diversity cases”); Ricciardi v.
Children’s Hosp. Med. Ctr., 811 F.2d 18, 21
(1st Cir. 1987) (“Federal Rules apply to all
cases in the district courts, including diversity
actions”); Fed.R.Evid. 1101. As discussed above,
however, a proper foundation has been established to admit
documents attached to the McCarthy affidavit and maintained
by BSI under the business records exception. Thus, although
Rule 902 as well as section 79A provide one means to admit
documents of public record into evidence, they are not the
only means. Accordingly, defendant’s argument, which
relies on a state evidentiary statute, is misguided.
final argument regarding the motion to strike challenges the
admissibility of the chapter 244, section 15 affidavit of
Villegas (“foreclosure affidavit”), which is
attached to the foreclosure deed (Docket Entry # 73-1).
(Docket Entry # 70). As an employee of BSI, Villegas has a
sufficient level of familiarity to satisfy the personal
knowledge requirement of Rule 56, as he is personally
involved with the handling of plaintiff’s records.
Fed.R.Civ.P. 56(c) (4); see Perez v. Volvo Car
Corp., 247 F.3d at 315. Moreover, the foreclosure
affidavit contains purely factual statements about the
publishing of the notice of sale and the occurrence of the
public auction of the property. (Docket Entry # 63-11).
Therefore, it satisfies the personal knowledge requirement of
Rule 56. Fed.R.Civ.P. 56(c)(4); see Perez v. Volvo Car
Corp., 247 F.3d at 315.
only other challenge to the admissibility of the foreclosure
affidavit is that it contains a false statement that BSI
“caused a notice of sale to be published” and
“mail[ed] the required notices” (Docket Entry #
63-11) when plaintiff’s counsel was the party actually
completing these actions (Docket Entry # 62-8, p. 4). (Docket
Entry # 70). Under Massachusetts law, “[a]n agency
relationship is created when there is mutual consent, express
or implied, that the agent is authorized to act on behalf and
for the benefit of the principal, subject to the
principal’s control.” RFF Family Partnership,
LP v. Link Development, LLC 907 F.Supp.2d at 161 (citing
Theos & Sons, Inc. v. Mack Trucks, Inc., 729
N.E.2d 1113, 1119 (2000)). “It is the conduct of the
principal, not the agent, that creates apparent
authority.” Id. (citing Sheinkopf,
927 F.2d at 1269).
defendant attempts to cite an inconsistency in the actions of
BSI, the foreclosure affidavit expressly states that
“BSI Financial Services, Inc., Attorney-in-Fact for
[plaintiff] solely in its capacity as Separate Trustee of CAM
Mortgage Trust 2013-1, caused a notice of sale to be
published” and also establishes BSI Financial
Services’ compliance with chapter 244 section 14.
(Docket Entry # 63-11). Thus, BSI, in the limited capacity in
which it acted as an agent for plaintiff, appropriately
caused a notice of sale to be published. (Docket Entry #
63-11). Defendant has not presented this court with any
evidence to the contrary, nor has defendant presented any
evidence to suggest that plaintiff’s counsel, or BSI,
acted outside of its actual agency in relation to plaintiff.
regards to defendant’s motion to strike the affidavits
of plaintiff’s counsel (“Longoria
affidavits”), defendant argues that they lack a basis
for personal knowledge under Rule 56, particularly in regards
to the testimony that the original note that plaintiff
executed to purchase the property (“the Conley
note”) is an “original business record”
under the hearsay exception. (Docket Entry # 80).
Additionally, defendant suggests in the motion to strike that
plaintiff’s counsel is barred from making an affidavit
because she is not a “qualified
witness.” (Docket Entry # 80).
Longoria affidavits satisfy the personal knowledge standard
because the affidavits are based in fact, “as opposed
to conclusions, assumptions, or surmise.” Perez v.
Volvo Car Corp., 247 F.3d at 316. Plaintiff’s
counsel stated that she had personally appeared at the
foreclosure sale of the property in question. (Docket Entry #
73, ¶ 8). Moreover, the Longoria affidavits provide
purely factual descriptions of the events that transpired at
the foreclosure sale, rather than statements of assumptions
or conclusions. Based on the personal observations made by
the affiant, the affidavits set out statements of fact based
on personal knowledge. See Perez v. Volvo Car Corp.,
247 F.3d at 316.
the testimony made in reference to the business records
attached to the Longoria affidavits, the affiant was able to
base this testimony on her own firm’s handling of
plaintiff’s business records. (Docket Entry # 81).
Defendant attempts to argue that the affidavit makes no
reference as to who at the affiant’s law firm
was involved with this process or that this was a regularly
conducted activity. (Docket Entry # 80). Defendant continues
by stating that the affiant herself had no personal
involvement with anything related to the purported transfer
of the Conley note from plaintiff to the affiant’s law
firm. (Docket Entry # 80).
stated above, however, an affiant is only required to have
some familiarity and ability to explain how the business
records were handled to satisfy Rule 803(6), especially when
there is no indication for a lack of trustworthiness. See
Wallace Motor Sales, Inc. v. American Motor Sales Corp.,
780 F.2d at 1061. As a member of the law firm representing
plaintiff in this case, the affiant’s statements meet
this standard. See id. Additionally,
plaintiff’s counsel has submitted evidence, such as a
June 25, 2013 bailee letter (“the bailee
letter”), to adequately demonstrate the firm’s
handling of the relevant business records. (Docket Entry #
73-1). The bailee letter attached to Longoria’s
supplemental affidavit states in pertinent part, “CAM
shall retain full ownership thereof and you
[plaintiff’s counsel] shall hold possession of the Note
evidencing the mortgage loan as agent and Bailee for and on
behalf of CAM.” (Docket Entry # 73-1). Therefore, the
affiant has the requisite ability to speak on behalf of the
handling of the business records, even without performing the
actual task herself. See id. Furthermore, because
the documents attached to the Longoria affidavits meet the
business record exception, an argument suggesting that they
make statements for the truth of the matter asserted is
precluded. Reliance on the bailee letter submitted with the
supplemental Longoria affidavit, and any other business
record meeting the hearsay exception, is therefore
appropriate. Fed.R.Evid. 803(6); Wallace Motor Sales,
Inc. v. American Motors Sales Corp., 780 F.2d at 1061.
the mere fact that the affiant is counsel for plaintiff is
not a sufficient reason to discredit the testimony provided
in the affidavit in question, especially given that the
affiant has met the personal knowledge requirement and the
document at issue was kept in the ordinary course of
counsel’s law firm. Fed.R.Evid. 602. “Every
person is competent to be a witness” except as
otherwise provided in the Federal Rules of Evidence.
Fed.R.Evid. 601. Defendant has not produced any authority to
support the contention that plaintiff’s counsel would
be otherwise unfit to submit an affidavit where, as here, she
is addressing under oath the maintenance of documents at her
law firm and how documents at her law firm are handled.
Motion for Summary Judgment
Judgment is designed “‘to pierce the boilerplate
of the pleadings and assay the parties’ proof in order
to determine whether trial is actually
required.’” Dávila v.
Corporación De Puerto Rico Para La Difusión
Pública, 498 F.3d 9, 12 (1st Cir.
2007). “Rule 56(c) mandates the entry of summary
judgment, after adequate time for discovery and upon the
motion, against a party who fails to make a showing
sufficient to establish the existence of an element essential
to that party’s case, and on which that party will bear
the burden of proof at trial.” Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986).
appropriate when the summary judgment record shows
“there is no genuine dispute as to any material fact
and the [moving party] is entitled to judgment as a matter of
law.” Fed.R.Civ.P. 56. “‘A dispute is
genuine if the evidence about the fact is such that a
reasonable jury could resolve the point in the favor of the
non-moving party.’” American Steel Erectors,
Inc. v. Local Union No. 7, Int’l Ass’n of Bridge,
Structural, Ornamental & Reinforcing Iron Workers,
536 F.3d 68, 75 (1st Cir. 2008). “‘A
fact is material if it carries with it the potential to
affect the outcome of the suit under the applicable
law.’” Id. Facts are viewed in favor of
the non- movant, i.e., defendant. See Noonan v. Staples,
Inc., 556 F.3d 20, 23 (1st Cir. 2009). The
summary judgment record sets out the following facts.
August 15, 2006, defendant, as the borrower, executed the
Conley note to American Home Mortgage, the lender, for $800,
000 (Docket Entry # 11-1) and, to secure the loan, gave a
mortgage (“Conley mortgage”) on the property to
Mortgage Electronic Registration Systems, Inc.
(“MERS”), as nominee for American Home Mortgage.
(Docket Entry # 11-2). The note required defendant to pay
principal and interest by making monthly payments every
month. (Docket Entry # 63-1). The payments on the mortgage
were to begin on October 1, 2006 and continue to be made on
the first day every month until the principal and interest
were paid off. (Docket Entry # 63-1, p. 1). If defendant
failed to make the required payment each month, then she
would be in default under the terms of the Conley note.
(Docket Entry # 63-1, p. 4).
if defendant should default, the note stipulated that
“the Note Holder may send [defendant] a written notice
telling me that if [defendant does] not pay the overdue
amount by a certain date, the Note Holder may require
[defendant] to pay immediately the full amount of Principal
which has not been paid and all the interest that [defendant]
owe on that amount.” (Docket Entry # 63-1, p. 4). In regards
to notice, the Conley note required that the Note Holder
provide at least ten days after the date on which the notice
is delivered or mailed to defendant before the Note Holder
could require defendant to pay off the entire principal due
to the default. (Docket Entry # 63-1, p. 4). As the sole
signor of the note, defendant was “fully and personally
obligated to keep all of the promises made in the Note,
including the promise to pay the full amount owed.”
(Docket Entry # 63-1, p. 5).
previously noted, the property that secured the loan
obligation was located at 23 Golf Drive in Nantucket. (Docket
Entry # 11-1). The Conley mortgage was filed at the Nantucket
County Land Court, Registry District (“Nantucket County
Land Court”) on August 15, 2006. (Docket Entry # 11-2).
The Conley mortgage was a refinance used to pay off
defendant’s prior loan to Option One Mortgage in the
amount of $620, 561.34 and resulted in a cash-out to
defendant in the amount of $152, 222.89. (Docket Entry #
11-3). At the origination of the Conley mortgage and note,
the property was valued at $1, 350, 000. (Docket Entry #
22 of the mortgage included a power of sale clause. It
states, in pertinent part, that the “Lender shall give
notice” of a default and:
If the default is not cured on or before the date specified
in the notice, Lender at its option may require immediate
payment in full of all sums secured by this Security
Instrument without further demand and may invoke the
STATUTORY POWER OF SALE and any other remedies permitted by
Applicable Law . . ..
If Lender invokes the STATUTORY POWER OF SALE, Lender shall
mail a copy of a notice of sale to Borrower, and to other
persons prescribed by Applicable Law, in the manner provided
by applicable law. Lender shall publish the notice of sale,
and the Property shall be sold in a manner prescribed by
(Docket Entry # 63-2).
the Conley mortgage included a second home rider stating that
the “Borrower shall occupy, and shall only use, the
Property as [the] Borrower’s second home.”
(Docket Entry # 63-2, p. 21). The Conley mortgage stated that
defendant was expected to occupy and use the property as
defendant’s principal place of residence within 60 days
after execution of the mortgage, unless otherwise agreed to
in writing. (Docket Entry # 63-2). The second home rider
replaced this “principal place” requirement by
explicitly stating that the property would be used as a
second home for defendant. Both parties agreed to the second
home rider. (Docket Entry # 63-2).
forth in the loan application, plaintiff owned real property
located on East 76th Street in New York City.
(Docket Entry # 63-3). Defendant indicated on the loan
application that her primary residence was this New York
property. (Docket Entry # 63-3). Additionally, at no time
prior to the initiation of the foreclosure process did
defendant notify BSI or plaintiff that she was maintaining
the property on Nantucket as a primary residence.
February 8, 2012, as stated in the notarized assignment filed
in the Nantucket County Land Court, MERS assigned the Conley
mortgage to J.P. Morgan Mortgage Acquisition Corp.
(“J.P. Morgan”) for value received. (Docket Entry
# 63-6). As set out in a July 2012 notarized assignment filed
in Nantucket County Land Court, J.P. Morgan then assigned the
Conley mortgage to HMC Assets, LLC solely in its capacity as
Separate Trustee of CAM V Trust (“HMC as CAM V
Trust”) on July 13, 2012. (Docket Entry # 63-7).
Finally, as stated in the notarized assignment filed in
Nantucket County Land Court, HMC as CAM V Trust assigned the
Conley mortgage to HMC Assets, LLC solely in its capacity as
Separate Trustee of CAM Mortgage Trust 2013-1, i.e.,
plaintiff, on May 3, 2013. (Docket Entry # 63-8).
26, 2013, HMC as CAM Mortgage was the holder of the original
Conley note. On that date, HMC as CAM Mortgage tendered the
Conley note to its attorney and agent, Doonan, Graves &
Longoria, LLC (“DG&L”), to retain possession
of the note on behalf of HMC as CAM Mortgage. (Docket Entry #
73). After June 26, 2016, HMC as CAM Mortgage retained full
ownership of the Conley note with the authority to request
that DG&L return the note to HMC as CAM Mortgage, the
holder and owner of the note. (Docket Entry # 73-1) (Docket
Entry # 73). At all times since June 26, 2013, DG&L, HMC
as CAM Mortgage’s counsel and agent, remained in
possession of the Conley note. (Docket Entry # 73-1) (Docket
Entry # 73, ¶¶ 5-7).
as likewise established in the affidavit of McCarthy,
plaintiff is currently the holder of the Conley note as well
as the current assignee of record of the Conley
mortgage. (Docket Entry # 63, ¶¶ 15, 16).
In pertinent part, McCarthy attests as follows:
An Assignment of Mortgage from HMC Assets, LLC solely in its
capacity as Separate Trustee of CAM V Trust to HMC Assets,
LLC solely in its capacity as Separate Trustee of CAM
Mortgage Trust 2013-1 dated May 3, 2013, was registered with
the Nantucket County Registry of District of the Land Court .
HMC Assets is the current holder of the Conley Note and
current assignee of record of the Conley Mortgage.
(Docket Entry # 63, ¶¶ 15, 16).
October 1, 2009, defendant had defaulted on her loan
installment payments. (Docket Entry # 63, ¶ 17) (Docket
Entry # 63-11, p. 3). As a result, BSI, as servicer of the
mortgage for plaintiff, sent a 150 day “Notice of Right
to Cure” letter (“35A letter”) dated June
25, 2013 to defendant pursuant to section 35A of chapter 244
(“section 35A”). (Docket Entry # 63-9). BSI is
the servicer of plaintiff. (Docket Entry ## 62-6, 63-9)
(Docket Entry # 62-8, p.5). According to the 35A letter,
defendant did not make the monthly loan payment due on
October 1, 2009. (Docket Entry # 63-9). The accumulated past
due amount totaled $169, 550.21. (Docket Entry # 63-9). In
the 35A letter, BSI required defendant to pay off the past
due amount on or before November 29, 2013, which was 150 days
from the date BSI sent defendant the 35A letter notifying her
of the default. (Docket Entry # 63-9). In addition, the 35A
letter explained that if defendant did not pay the past due
amount by the deadline, defendant could be evicted from the
property after a foreclosure sale. (Docket Entry # 63-9).
accompanied the 35A letter with a “Right to Request a
Modified Mortgage Loan” notice (“loan
modification notice”). (Docket Entry # 63-10). The
letter stated that under Massachusetts law defendant was
eligible to request a modification of her mortgage. (Docket
Entry # 63-10). The loan modification notice explained that a
modification could potentially change the options given to
defendant in the 35A letter. (Docket Entry # 63-10).
Defendant submitted an application to modify the loan.
(Docket Entry # 69-3). As stated in the McCarthy affidavit,
there are a series of steps plaintiff applies when reviewing
the eligibility of a loan modification request. (Docket Entry
# 63, ¶¶ 22-26). The McCarthy affidavit states
As a good faith effort to avoid foreclosure, HMC Assets
reviewed Conley for a modification of her mortgage in
November of 2013.
[Plaintiff] utilizes FHA guidelines when considering its
borrowers for a loan modification.
Under [Fair Housing Act] guidelines, a borrower’s
mortgage payment must not be in excess of 31% of their
verifiable monthly average income.
[Plaintiff] used [Defendant’s] Federal Tax Returns for
2011 and 2012 [to establish defendant’s] income.
[Defendant’s] mortgage payment including principal,
interest, taxes and insurance is approximately 62.4% of her
verifiable monthly average income . . ..
Given the approximate 62.4% ratio of her mortgage payment to
verifiable monthly average income, Conley is not eligible for
a modification under FHA guidelines.
(Docket Entry # 63, ¶¶ 21-26) (paragraph numbers
a loan modification, defendant failed to cure the default
prior to expiration of the 150 days. Plaintiff subsequently
filed with the Land Court Department of the Massachusetts
Trial Court (“the Land Court”) a “Complaint
to Determine Military Status” pursuant to the
Servicemembers Civil Relief Act, 50 U.S.C. §§ 501
et seq. (“Servicemembers Act”). (Docket Entry #
11-9). Pursuant to the Servicemembers Act, an order of notice
was published in the Nantucket Inquirer and Mirror
on January 2, 2014, served on defendant on January 14, 2014,
and recorded with the Land Court on January 10, 2014. (Docket
Entry # 11, ¶ 18). The Land Court determined that
defendant was not entitled to the benefits of the
Servicemembers Act. (Docket Entry # 11-11).
forth by affidavit (“noteholder affidavit”) dated
December 17, 2013, HMC as CAM Mortgage was the foreclosing
entity. As explained above, DG&L, plaintiff’s agent
and attorney, was in possession of the note on behalf of HMC
as CAM Mortgage, the owner of the note. The affiant,
Villegas, a vice president of BSI and an agent of HMC as CAM
Mortgage, attests to his familiarity and review of BSI
records kept in the ordinary course of BSI’s business.
In the noteholder affidavit, Villegas certified that the
requirements of section 35B of chapter 244 (“section
35B”) had “been compiled with” regarding
the Conley note. (Docket Entry # 62-6). The noteholder
affidavit also states that it is the regular practice of BSI
to receive records related to a mortgage loan from another
entity. (Docket Entry # 62-6). The noteholder affidavit was
registered with the Land Court on January 29, 2014. (Docket
Entry # 62-6). On December 17, 2013, Villegas separately sent
defendant a certification pursuant to 209 C.M.R. §
18.21A(2)(c) that HMC as CAM Mortgage was the current owner
of the Conley note and the assignee of the Conley mortgage.
(Docket Entry # 62-8, p. 5) (Docket Entry # 62, ¶ 11).
February 6, 13 and 20, 2014, notice of the foreclosure sale
(Docket Entry # 11-13) was published in the Nantucket
Inquirer and Mirror, a newspaper of general circulation,
for three consecutive weeks not less than 21 days prior to
the foreclosure sale. (Docket Entry # 62-7). Pursuant to
chapter 244, sections 14 and 17B, a “Notice of Intent
to Foreclose Mortgage” and “Intent to Pursue
Deficiency After Foreclosure of Mortgage” letter was
mailed to defendant on February 7, 2014. (Docket Entry #
62-8). The letter alerted defendant that the mortgaged
property would be sold at public auction on March 7, 2014, on
the mortgaged premises. (Docket Entry # 62-8). Plaintiff also
notified defendant that on or after the foreclosure sale,
defendant may be liable for any deficiency in proceeds of the
foreclosure sale although “[n]o deficiency after the
foreclosure sale may be pursued if [defendant had] obtained
or will obtain a Chapter 7 bankruptcy.” (Docket Entry #
62-8, p. 2). (Docket Entry # 62-8).
purchased the property at a non-judicial foreclosure sale on
March 7, 2014, and registered the foreclosure deed with the
Land Court. (Docket Entry ## 11-15, 11-16). On March
7, 2014, plaintiff, by itself or through its attorney-in-fact
and agent (BSI),  conducted the foreclosure sale. (Docket
Entry # 63-11, pp. 1, 3) (Docket Entry # 62, ¶¶
12-13). The Monroe Auction Group, in turn, was the auctioneer
and BSI was its client. (Docket Entry # 62-9). Double B
Capital Group, Inc. (“Double B Capital”) was the
successful bidder at the foreclosure sale, but failed to
consummate the sale of the property. ...