Citimortgage, Inc. v. Garfield
35,838
| N.M. Ct. App. | Jun 5, 2017Background
- Citimortgage, Inc. sued John David Garfield and Sally G. Garfield in Santa Fe County district court seeking foreclosure.
- The complaint attached the promissory note (with endorsements) and the mortgage.
- District court found Plaintiff had both the right to enforce the note and ownership of the mortgage lien when the complaint was filed.
- Defendants challenged Plaintiff's standing, MERS’s authority to assign the mortgage, and sought to admit a witness whose testimony the district court excluded.
- Defendants appealed the foreclosure judgment; the Court of Appeals issued a calendar notice proposing affirmance and the defendants filed a memorandum in opposition.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to foreclose | Citimortgage had the note (with endorsements) and mortgage attached to the complaint, showing right to enforce and lien ownership | Plaintiff lacked simultaneous possession/control of both note and mortgage at filing, so no standing | Affirmed: Plaintiff had the right to enforce the note and owned the mortgage at filing; standing established |
| MERS authority to assign mortgage | MERS, as nominee for the lender, validly assigned the mortgage to Plaintiff; loan modification was authorized and relied upon | MERS was a nominal possessor and lacked authority to convey title or modify the loan | Affirmed: MERS can assign as nominee; district court found evidence of authority and that defendants accepted/benefitted from the modification |
| Exclusion of witness testimony | Plaintiff does not contest admissibility | Defendants challenged district court's refusal to accept a witness's testimony | Affirmed: Defendants abandoned this challenge on appeal |
Key Cases Cited
- Deutsche Bank Nat’l Trust Co. v. Johnston, 369 P.3d 1046 (2016 N.M.) (right to enforce note must exist at time foreclosure action is filed)
- Bank of New York v. Romero, 320 P.3d 1 (2014 N.M.) (MERS, as nominee, may assign the mortgage)
- Flagstar Bank, FSB v. Licha, 356 P.3d 1102 (2015 N.M. Ct. App.) (reiterating that MERS can assign where acting as nominee)
- PNC Mortg. v. Romero, 377 P.3d 461 (2016 N.M. Ct. App.) (recognition/clarification of prior MERS authority rulings)