Osaretin A. Porter v. First NLC Financial Services, LLC
140 A.3d 156
| R.I. | 2016Background
- Porter appealed the Superior Court’s grant of summary judgment for MERS and Beltway in a mortgage-foreclosure action.
- Porter alleged MERS and First NLC had an agency relationship that was terminated when First NLC declared bankruptcy, which she claimed prevented MERS from foreclosing.
- Porter also argued the statutory nonjudicial foreclosure scheme violated her due process rights by allowing property transfers without judicial review.
- Defendants submitted affidavits supporting their right to foreclose and ownership/assignment steps; Porter failed to produce competent evidence to create genuine disputes of material fact.
- Porter raised some arguments previously resolved by Bucci v. Lehman; remaining contentions included alleged termination of agency by First NLC’s bankruptcy, identity of the loan servicer/agency, and alleged procedural defects at the auction.
- The Supreme Court affirmed summary judgment, finding Porter failed to present competent evidence or preserve some issues for appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did First NLC’s bankruptcy terminate MERS’s agency such that MERS could not foreclose? | Bankruptcy terminated the agency, so MERS lacked authority to foreclose. | No competent evidence of First NLC bankruptcy; even if, no proof agency ended. | Not reached on merits — Porter produced no competent evidence the bankruptcy occurred; issue not properly before court. |
| Was there a genuine dispute about the identity of the loan servicer or existence of an agency between MERS and any principal? | Verified complaint raised factual issues on servicer identity and agency existence. | Defendants offered affidavits establishing operative facts; Porter offered no competent contrary evidence. | Court held no genuine issue of material fact; summary judgment appropriate for defendants. |
| Did the foreclosure auction procedure (MERS bidding without owning the note and later assigning to Beltway) violate statutory foreclosure requirements? | MERS bid without owning the note and assigned the bid after auction without continuation, rendering the sale defective. | Procedure complied with statutory scheme; defendants presented supporting evidence. | Issue waived — Porter did not raise this contention below, so court would not consider it. |
| Does the statutory nonjudicial foreclosure scheme violate due process by permitting property transfer without judicial review? | Scheme allows deprivation of property without judicial review, violating due process. | Issue not raised below; defendants relied on procedural posture and statutory framework. | Waived — Porter failed to raise this claim in Superior Court; court refused to consider it on appeal. |
Key Cases Cited
- Pichardo v. Stevens, 55 A.3d 762 (R.I. 2012) (standard of appellate review for summary judgment)
- DePasquale v. Cwiek, 129 A.3d 72 (R.I. 2016) (appellate summary-judgment standards)
- Great American E & S Ins. Co. v. End Zone Pub. & Grill of Narragansett, Inc., 45 A.3d 571 (R.I. 2012) (summary-judgment affirmation standard)
- Mutual Development Corp. v. Ward Fisher & Co., LLP, 47 A.3d 319 (R.I. 2012) (summary-judgment principles)
- Moura v. Mortgage Elec. Registration Sys., Inc., 90 A.3d 852 (R.I. 2014) (nonmoving party must produce competent evidence of disputed facts)
- Mruk v. Mortgage Elec. Registration Sys., Inc., 82 A.3d 527 (R.I. 2013) (mere allegations insufficient to defeat summary judgment)
- Bucci v. Lehman Bros. Bank, FSB, 68 A.3d 1069 (R.I. 2013) (addressing related MERS/foreclosure issues)
- State v. Figuereo, 31 A.3d 1283 (R.I. 2011) (raise-or-waive rule for appellate review)
- In re Shy C., 126 A.3d 433 (R.I. 2015) (narrow exception to raise-or-waive rule)