HSBC Mortgage Services, Inc. v. Murphy
19 A.3d 815
| Me. | 2011Background
- Murphys executed a $149,000 promissory note to Calusa Investments and granted a mortgage on their Auburn home; Calusa was the lender and MERS was listed as nominee for lender and assigns, though the note itself did not refer to MERS.
- MERS assigned the mortgage to HSBC in 2006 and a later confirmatory assignment of the note and mortgage to HSBC was executed by MERS in 2009.
- HSBC sued for foreclosure in 2008; the first summary-judgment motion was denied due to lack of record evidence that HSBC owned the note, among other deficiencies.
- HSBC later filed a second motion for summary judgment with new affidavits (Vadney) and attached documents, including an allonge with an endorsement to HSBC and a 2009 notice letter; Gonzalez’s 2008 affidavit had provided different timing for balances.
- The District Court granted summary judgment; Murphy appeal argued affidavits were inherently untrustworthy and failed to establish business-record foundation under M.R. Evid. 803(6); the Maine Supreme Judicial Court vacated the judgment and remanded for discovery and trial, and potential fee awards, forbidding further Rule 56 motions by HSBC.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether HSBC properly proves ownership of the note and mortgage. | Murphys contend ownership is not shown by the record. | HSBC asserts its assignments and endorsements prove ownership. | Affidavits are inherently untrustworthy; ownership not established on summary judgment. |
| Whether MERS’ assignments to HSBC establish a valid chain of title. | Murphys challenge the validity/chain of assignment. | HSBC relies on MERS assignments to prove transfer. | Chain of title insufficiently established due to untrustworthy affidavits; judgment vacated. |
| Whether proper notice of default and right to cure were provided. | Murphys argue notice was not properly shown by admissible evidence. | HSBC contends notice complied with statute. | Notice foundation undermined by untrustworthy affidavits; judgment vacated. |
| Whether the Vadney and Gonzalez affidavits satisfy the business-record foundation under 803(6). | Affidavits lack reliable foundation to admit attached records. | Affidavits support admission of records. | Affidavits are inherently untrustworthy and do not satisfy 803(6); judgment vacated. |
Key Cases Cited
- Chase Home Finance LLC v. Higgins, 2009 ME 136 (Me. 2009) (foreclosure summary-judgment standards for mortgage actions)
- Camden Nat'l Bank v. Peterson, 2008 ME 85 (Me. 2008) (strict compliance with foreclosure statutory steps)
- Levine v. R.B.K. Caly Corp., 2001 ME 77 (Me. 2001) (evidentiary standards for summary judgment affidavits)
- Bank of Am., N.A. v. Barr, 2010 ME 124 (Me. 2010) (trustworthiness standard for business-record affidavits under 803(6))
- Gonzalez affidavit reference in Murphy v. HSBC, - (-) (considered for pattern of untrustworthiness (contextual))
- State v. Nelson, 2010 ME 40 (Me. 2010) (four-factor test for trustworthiness of records)