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U.S. Bank, National Association v. Milan

Appeals Court of Massachusetts, Essex

December 4, 2017

U.S. BANK, NATIONAL ASSOCIATION, trustee, [1]
v.
STEVEN L. MILAN & another.[2]

          Heard: March 1, 2017.

         Summary process. Complaint filed in the Northeast Division of the Housing Court Department on July 23, 2012. The case was heard by David D. Kerman, J., on motions for summary judgment.

          Michael R. Murphy (Michael R. Stanley also present) for the plaintiff.

          Carl D. Goodman for the defendants.

          Present: Green, Wolohojian, & Sullivan, JJ.

          GREEN, J.

          The plaintiff (U.S. Bank) appeals from a judgment of a Housing Court judge, dismissing its complaint for summary process. The Housing Court judge based his order of dismissal on the failure of U.S. Bank's notice of default to comply strictly with the requirements of paragraph 22 of the mortgage it foreclosed against the defendants, Steven and Karen Milan (Milans), incident to U.S. Bank's acquisition of title to the property. In so doing, the judge applied the holding of Pinti v. Emigrant Mort. Co., 472 Mass. 226, 241-242 (2015) (Pinti), to invalidate U.S. Bank's claim of title. We conclude that was error, and reverse.

         Background.

          The Milans are the former owners and current occupants of residential property located at 56 Jasper Road in Saugus. On May 16, 2005, incident to a loan refinance, the Milans granted to Mortgage Electronic Registration Systems, Inc. (MERS), a mortgage on the property to secure a note made to Saugus Federal Credit Union.[3] In 2007, the Milans defaulted on the mortgage loan, and on June 18, 2007, U.S. Bank's servicing agent (which had succeeded MERS as mortgagee by assignment) sent to the Milans the first of several notices of default.[4] The Milans assert, and the Housing Court judge concluded, that the notices did not comply strictly with the requirements specified for such notices in paragraph 22 of the mortgage.[5] Thereafter, U.S. Bank conducted a foreclosure auction, pursuant to the statutory power of sale contained in the mortgage, and (as U.S. Bank was the successful bidder at the auction) a foreclosure deed in favor of U.S. Bank was recorded on June 21, 2012. The Milans remained in possession of the property, prompting U.S. Bank to initiate the present summary process action in the Housing Court on July 23, 2012.

         We describe in some detail the trajectory of the summary process action as it progressed to the judgment of dismissal, as the parties' conduct of the matter bears on a determination whether the Pinti rule applies to it. On July 26, 2012, the Milans filed their answer to U.S. Bank's complaint. The answer used a printed form answer, with a series of blanks and checkboxes completed by hand, and a handwritten legend stating that it was "prepared with the assistance of counsel" appears at the bottom of the first page. On the second page of the printed form, within the section captioned to list defenses based on a claim that the tenancy was "not properly terminated and/or case not properly brought, " a check appears next to a box reading "The landlord does not have a superior right to possession and/or does not have standing to bring this action." As reflected on the docket, on September 24, 2012, U.S. Bank served discovery requests on the Milans. At some point thereafter, but apparently before November 30, 2012, the Milans served on U.S. Bank their responses to U.S. Bank's discovery requests.[6] Among other interrogatories, U.S. Bank's interrogatory no. 8 asked the Milans to "[p]lease state in full and complete detail every fact and reason why you believe that the [p]laintiff does not have a superior right to possess the [p]roperty and/or lacks standing to bring this action." The Milans responded as follows:

"We, Karen and Steven Milan of 56 Rear Jasper Street, Saugus, MA 01906 do not believe that plaintiff [sic] has the right to possess, foreclose or evict us for the following reasons.
"We signed closing papers for a mortgage of $524, 000.00 to Saugus Federal Credit Union on May 10, 2005. Closing was done by Attorney Timothy J. Doyle, 99 Walnut Street - Suite A, Saugus North Professional Building, Saugus, MA 01906. We acknowledge signing these mortgage papers. We also have the letter from Attorney Timothy J. Doyle to Sebastian Insurance Agency of Saugus, MA requesting an insurance binder for the closing on May 10, 2005. We also have a copy of said binder. This mortgage of May 10, 2005, is our true and correct mortgage. Mortgage was recorded at Southern Essex County Registry of Deeds, Salem, MA on May 13, 2005.
"Another mortgage for $524, 000.00 to Saugus Federal Credit Union was done on May 16, 2005, by Attorney Timothy J. Doyle, 99 Walnut Street - Suite A, Saugus North Professional Building, Saugus, MA 01906. This mortgage assigned our mortgage to MERS. This mortgage was recorded at Southern Essex County Registry of Deeds, Salem, MA on May 18, 2005. We did not sign this mortgage. Also, our true mortgage of May 10, 2005, was still open and not discharged. Therefore, there were [two]."

         On May 5, 2014, the Milans' present counsel entered his appearance on their behalf in the Housing Court. Shortly thereafter, on May 14, 2014, U.S. Bank filed its motion for summary judgment. In response, the Milans filed an "emergency motion to stay plaintiff's motion for summary judgment pursuant to M.R.C.P. 56(f)" and a separate "motion for leave to conduct discovery." In support of both motions, the Milans asserted that the mortgage on which U.S. Bank had foreclosed was procured by fraud, and that the Milans' signatures appearing thereon were forged; accordingly, the Milans suggested they were entitled to conduct discovery into the question of fraud or forgery, including a deposition of the closing attorney and procurement of a handwriting ...


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