Cosajay v. Mortgage Electronic Registration Systems, Inc.
980 F. Supp. 2d 238
D.R.I.2013Background
- Ms. Cosajay challenged three mortgage assignments on grounds of invalidity and manufactured documents.
- Foreclosure proceeded despite her challenges; the referee recommended dismissal for lack of standing due to nonprivity.
- First Circuit decisions Culhane and Woods held standing may exist without privity to assignments.
- Rhode Island law and its power-of-sale framework were used to analogize standing protections to Massachusetts law.
- Court now rejects the R&R, concluding Cosajay has standing to pursue the suit against Defendants.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Cosajay have standing to challenge the assignments. | Cosajay argues lack of privity does not bar standing in mortgage challenges. | Defendants contend lack of privity requires dismissal. | Cosajay has standing; privity not required. |
| Are Culhane and Woods controlling under Rhode Island law? | Culhane/Woods support standing despite nonparty status. | Rhode Island law may adhere to traditional privity concepts. | Culhane/Woods control; standing exists under RI law. |
| Should the R&R be sustained or rejected based on standing? | R&R misapplies privity to foreclose standing. | R&R correctly dismissed for lack of standing. | R&R rejected; motion to dismiss denied. |
Key Cases Cited
- Culhane v. Aurora Loan Servs. of Neb., 708 F.3d 282 (1st Cir. 2013) (mortgagor standing to challenge assignments without privity in certain contexts)
- Woods v. Wells Fargo Bank, N.A., 733 F.3d 349 (1st Cir. 2013) (standing may exist when mortgagor not party to or beneficiary of assignments)
- Brough v. Foley, 525 A.2d 919 (R.I. 1987) (nonparty generally lacks standing under contract)
- Bucci v. Lehman Bros. Bank, FSB, 68 A.3d 1069 (R.I. 2013) (RI law supports Culhane-like standing analysis)
- Antilles Cement Corp. v. Fortuno, 670 F.3d 310 (1st Cir. 2012) (standing for concrete, particularized injury)