581 F. App'x 500
6th Cir.2014Background
- Connolly obtained a $333,000 mortgage from Ameriquest in 2002, defaulted after 2008, and filed Chapter 7 in April 2009.
- The mortgage was assigned multiple times to trusts for which Deutsche Bank acted as trustee; assignments were recorded in 2009 and 2011.
- Deutsche bought the property at a sheriff’s sale in May 2010; recorded a sheriff’s deed and Connolly had a 12‑month statutory redemption period.
- In December 2010 Deutsche recorded an Affidavit Expunging the Sheriff’s Deed stating the May 2010 sale was "inadvertently held." A new sheriff’s sale occurred May 18, 2011, and Deutsche again purchased the property.
- Connolly sued in April 2012 in state court alleging wrongful foreclosure, defective assignments (robo‑signing), lack of standing by Deutsche, and slander of title; Deutsche removed and moved for summary judgment. The district court granted summary judgment for Deutsche; the Sixth Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Connolly’s redemption period remained open (tolling) | Filing suit tolled the 12‑month redemption period from the 2011 sale | Filing a suit does not toll the statutory redemption period | Filing the complaint did not toll redemption; Connolly’s redemption period expired |
| Validity/effect of an Affidavit Expunging a Sheriff’s Deed | The unilateral expungement improperly interfered with Connolly’s redemption rights and was wrongful | Michigan law allows such affidavits under M.C.L. §565.451a; affidavit put interested persons on notice and did not prove fraud | Affidavit is valid/effective to expunge the prior deed; no fraud or irregularity shown to extend redemption |
| Whether Deutsche had standing to foreclose/enforce the note | Assignments were forged/robo‑signed, so Deutsche lacks standing and chain of title is void | Deutsche was mortgagee of record and a party entitled to foreclose by advertisement under Michigan law | Deutsche, as mortgagee of record, had standing to foreclose; Connolly lacks standing to challenge assignments absent a defense rendering them absolutely void |
| Slander of title claim based on the expungement affidavit | Affidavit disparaged title and injured Connolly | Affidavit was valid; claim is time‑barred (one‑year statute) and lacks malice/special damages | Slander of title claim is time‑barred and fails on merits (no malice or damages) |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment procedure)
- Conlin v. Mortgage Elec. Registration Sys., 714 F.3d 355 (6th Cir.) (homeowner lacks standing to challenge voidable assignments without showing prejudice)
- Kim v. JPMorgan Chase Bank, N.A., 493 Mich. 98 (Mich. 2012) (prejudice standard for equitable extension of redemption period)
- Livonia Props. Holdings, LLC v. 12840‑12976 Farmington Rd. Holdings, LLC, [citation="399 F. App'x 98"] (6th Cir.) (non‑party generally lacks standing to challenge assignments; exception for defenses rendering assignment absolutely void)
- Residential Funding Co. v. Saurman, 490 Mich. 909 (mortgagees of record can be parties entitled to foreclose by advertisement)