United States District Court, D. Massachusetts
CITIBANK, N.A., not in Its Individual Capacity but Solely as Separate Trustee for PMT NPL FINANCING 2015-1, Plaintiff,
RENEE ANNA NAJDA a/k/a RENEE NAJDA, and ANDREW NAJDA, Defendants and Counterclaimants,
CITIBANK, N.A., not in Its Individual Capacity but Solely as Separate Trustee for PMT NPL FINANCING 2015-1, and CITIMORTGAGE, INC., Counterclaim Defendants.
FINDINGS OF FACT, RULINGS OF LAW, AND ORDER FOR
Court conducted a trial in the above-captioned civil action
in November 2017. Several of the claims were tried to a jury,
including the claim of Citibank, N.A. as trustee for PMT NPL
Financing 2015-1 (“Citibank”), against Renee and
Andrew Najda for breach of contract (Count II), and Renee and
Andrew Najda's claims against CitiMortgage, Inc. for
promissory estoppel (Count V) and against Citibank and
CitiMortgage for Chapter 93A (Count X). The jury returned a
verdict in favor of Citibank and CitiMortgage on all
other claims were tried to the Court, including
Citibank's claims for declaratory judgment (Count I),
conditional judgment (Count IV), and foreclosure (Count V),
and the Najdas' claims for declaratory judgment with
respect to the holder of the note (Count I). Upon
consideration of the evidence and the arguments of the
parties in their various submissions, the Court makes the
following findings of facts and conclusions of law with
respect to these counts, pursuant to Rule 52 of the Federal
Rules of Civil Procedure.
Findings of Fact
about August 3, 2007, the Najdas executed an
“Interest-Only Period Adjustable Rate Note” with
CitiMortgage in the amount of $3, 464, 000.00 (the
“Note”). Both Andrew Najda and Renee Najda signed
the Note, and their signatures were witnessed by closing
attorney Regina Buckley. Attorney Buckley also signed the
Note as a witness to the Najdas' signatures.
time of trial, Citibank was in physical possession of the
Note. The Note was physically kept at the office of
Citibank's trial counsel, and it was presented at the
trial. Attached to the Note are two allonges, both endorsed
in blank, that were signed on behalf of the original lender,
CitiMortgage. The allonges are affixed by paper clip to the
original Note. Visual examination indicates that they had
previously been stapled to the Note.
secure the Note, Renee Najda granted a mortgage on the real
property located at 71 Flint Road, Concord, Massachusetts
(the “Property”) to Mortgage Electronic
Registration Systems, Inc. (“MERS”) as nominee
for CitiMortgage and its successors and assigns (the
“Mortgage”). The Mortgage grants a power of sale
in the event of default and acceleration.
Mortgage was assigned several times. By Assignment dated
October 13, 2010, MERS assigned the Mortgage to CitiMortgage.
By Assignment dated September 18, 2012, CitiMortgage assigned
the Mortgage to PennyMac, Corp. By Assignment dated June 24,
2014, PennyMac assigned the Mortgage to Citibank, N.A., as
Trustee for the benefit of SWDNSI Trust Series 2010- 3. By
Assignment dated November 12, 2015, Citibank, N.A., as
Trustee for the benefit of SWDNSI Trust Series 2010-3,
assigned the Mortgage to Christiana Trust, a division of
Wilmington Savings Fund Society, FSB, not in its individual
capacity, but solely as separate trustee for PMT NPL
Financing 2015-1 (“Christiana Trust”). By
assignment dated May 31, 2016, Christiana Trust assigned the
Mortgage to Plaintiff Citibank Trustee, N.A. not in its
individual capacity, but solely as separate trustee for PMT
NPL Financing 2015-1, the present plaintiff. All assignments
of the Mortgage were duly recorded in the Middlesex County
(South) Registry of Deeds. As of the time of trial, the
plaintiff was the holder of the Mortgage.
Najdas defaulted on their loan obligations beginning with the
payment due August 1, 2011 and their payment obligations
under the Note continue to be past due. By failing to make
all payments due, Renee Najda breached the terms of the
Mortgage and Andrew and Renee Najda breached the terms of the
Note. On January 5, 2012, the loan servicer at the time,
Specialized Loan Servicing, LLC, sent the Najdas a Notice of
Default and Notice of Intent to Foreclose, but the Najdas did
not bring their loan current. As of December 14, 2017, the
Najdas owe $4, 833, 073.61 on the Note and
Conclusions of Law
entity seeking foreclosure is required to hold both the
mortgage and the original note at the time of foreclosure.
Eaton v. Fed. Nat'l Mortg. Ass'n, 969 N.E.2d
1118, 1132 (Mass. 2012); accord Matt v. HSBC Bank
USA, 968 F.Supp.2d 351, 357 (D. Mass. 2013) (citation
omitted). “[A]lthough a foreclosing mortgagee must
demonstrate an unbroken chain of assignments in order to
foreclose a mortgage, and . . . that it holds the note (or
acts as authorized agent for the note holder) at the time it
commences foreclosure, 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.” Sullivan v. Kondaur
Capital Corp., 7 N.E. 3d 1113');">7 N.E. 3d 1113, 1119 (Mass. App. Ct.
2014) (citation omitted).
the unbroken chain of assignments from MERS to the plaintiff
establishes that the plaintiff is the lawful and valid holder
of the Mortgage. See U.S. Bank Nat'l Ass'n v.
Ibanez, 941 N.E.2d 40, 53 (Mass. 2011);
Sullivan, 7 N.E. 3d at 1119 (Mass. App. Ct. 2014);
(see also Op. & Order 5-6, Jan. 13, 2016 (dkt.
no. 89).) The plaintiff is also the actual holder of the Note
which has been endorsed in blank, permitting the bearer of
the Note the right to enforce its terms. See
Mass. Gen. Laws ch. 106 §§ 3-205, 3-301; Khalsa
v. Sovereign Bank, N.A., 44 N.E.3d 863, 864 (Mass. App.
Ct. 2016); (see also Op. & Order 9, Mar. 29,
2017 (dkt. no. 201).)
the plaintiff holds the Mortgage and the Note, it has
established its right to foreclose. See Eaton, 969
N.E.2d at 1133; Sullivan, 7 N.E.3d at 1119. As the
Court previously held, there has been compliance with
Massachusetts General Laws ch. 244, §§ 35A, 35B,
and 35C. (Op. & Order 3-5, Mar. 29, 2017.) Further, the
Notice of Default and Notice of Intent to Foreclose sent to
the Najdas on January 5, 2012, substantially complies with
the notice provisions of paragraph 22 of the Mortgage.
a conditional judgment of foreclosure shall enter in the
amount of $4, 833, 073.61. See Mass. Gen. Laws ch.
244, §§ 3, 5. The defendant shall have two months
from the entry of judgment to pay the plaintiff $4, 833,
073.61, plus interest at the rate of 4.0%. In the event that
the defendants fail to pay the plaintiff such amount within
two months of the entry of the conditional judgment, the
Property is to be sold by the ...