Bank of America, N.A. v. Payne
279 Or. App. 239
Multnomah Cty. Cir. Ct., O.R.2016Background
- Defendant granted a trust deed naming MERS as beneficiary and Security Title Guaranty as trustee; Plaza Home Mortgage was lender. Foreclosure sale was conducted by ReconTrust; plaintiff claims it purchased the property at that trustee’s sale and sought possession via FED.
- Defendant remained in possession and argued plaintiff was not a “purchaser” under former ORS 86.755(6) because there is no record evidence that MERS or plaintiff had authority to transfer beneficial interest or appoint ReconTrust as successor trustee.
- Plaintiff relied primarily on the recorded trustee’s deed and statutory provisions (former ORS 86.770/86.780) to argue that post-sale challenges were barred and that the deed’s recitals were prima facie evidence.
- Trial court accepted plaintiff’s position and awarded restitution of the premises to plaintiff.
- On appeal, court considered this case in light of Wolf v. GMAC Mortgage, LLC, which held that a sale cannot foreclose property interests under the OTDA unless conducted by an actual, validly appointed trustee.
- The appellate court found the record here lacked evidence that ReconTrust was validly appointed (no proof plaintiff was a beneficiary or that MERS had authority), so the sale could not operate as a valid trustee’s sale; judgment reversed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiff was a “purchaser” entitled to possession after a trustee’s sale under former ORS 86.755(6) | Trustee’s deed and statutory presumptions (former ORS 86.770/86.780) suffice to establish purchaser status and foreclose post-sale challenge | No evidence that MERS or plaintiff had authority to transfer beneficiary rights or appoint ReconTrust as successor trustee; sale invalid | Reversed — plaintiff failed to show a validly appointed trustee, so sale could not effect foreclosure under OTDA |
| Whether recitals in a recorded trustee’s deed preclude post-sale challenges about trustee appointment | Recitals are prima facie evidence and support finality of the sale | Recitals don’t overcome lack of foundational proof that a valid trustee was appointed | Recitals insufficient where record lacks evidence of valid trustee appointment |
| Whether MERS’s assignment establishes beneficiary authority or agency | Assignment by MERS is sufficient to confer beneficiary status or transfer rights | MERS’s execution is not proof it was the beneficiary or acted as beneficiary’s agent without supporting agreement | Held for defendant: bare MERS assignments are not proof of authority or agency |
| Whether Wolf decision controls and prevents application of statutory finality here | Argued Wolf is distinguishable (procedural differences) | Relied on Wolf to argue sale invalid without an actual trustee | Wolf controls: absent valid trustee appointment, OTDA trustee’s sale cannot foreclose |
Key Cases Cited
- Wolf v. GMAC Mortgage, LLC, 276 Or. App. 541 (Or. Ct. App. 2016) (a trustee’s sale cannot foreclose property interests under the OTDA unless conducted by an actual, validly appointed trustee)
- Brandrup v. ReconTrust Co., 353 Or. 668 (Or. 2013) (describing practice of naming MERS as beneficiary and related issues)
- Niday v. GMAC Mortgage, LLC, 353 Or. 648 (Or. 2013) (discussing separation of note ownership and PETE and evidentiary gaps about successor status)
- Federal Nat. Mortg. Ass’n v. Goodrich, 275 Or. App. 77 (Or. Ct. App. 2015) (bare assertions that MERS acted as agent are not evidence of agency)
- Reeves v. Rodgers, 204 Or. App. 281 (Or. Ct. App. 2006) (standards for viewing facts in favor of prevailing party in FED trial)