Sallie v. Fifth Third Bank
297 Mich. App. 115
| Mich. Ct. App. | 2012Background
- Plaintiff and wife borrowed $63,665.32 in 2000 and granted a mortgage securing the loan.
- Old Kent Bank merged into Fifth Third Bank in 2001; wife died in 2003.
- Plaintiff defaulted in September 2009; bank sought foreclosure by advertisement under power of sale.
- Note could not be located at foreclosure start; plaintiff challenged foreclosing without note.
- Trial court granted summary disposition for defendant, concluding mortgage remedies permitted foreclosure despite missing note.
- Court held foreclosure by advertisement valid without producing the note, if statutory conditions are met and ownership of debt is shown.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| May a mortgagee foreclose by advertisement without the note? | Plaintiff argues production of the note is required. | Defendant contends the mortgage and power of sale suffice, note not required. | Yes; mortgage with power of sale allows foreclosure without the note. |
| What must be shown to foreclose by advertisement besides the mortgage? | Plaintiff claims lacking note undermines debt proof. | Defendant proves default and debt with clear evidence from the mortgage terms. | Default, valid mortgage with power of sale, and ownership of debt shown. |
| Must the foreclosing party own or service the debt to foreclose by advertisement? | Not explicitly stated; challenging ownership requirement. | Owner or servicing agent of indebtedness may foreclose. | Yes; the foreclosing party must own or service the debt. |
| Is MCL 440.3309 applicable to this foreclosure? | Argues the lost-note statute applies. | Statute pertains to instruments lost, not mortgage foreclosure. | Inapplicable; MCL 440.3309 does not govern mortgage foreclosure. |
Key Cases Cited
- Snyder v. Hemmingway, 47 Mich 549 (1882) (mortgagee may foreclose without producing note with valid mortgage and sale power)
- Hungerford v. Smith, 34 Mich 300 (1876) (clear proof of default and indebtedness required)
- George v. Ludlow, 66 Mich 176 (1887) (default and continuing debt obligation supported foreclosure)
- Young v. McKee, 13 Mich 552 (1865) (principles of mortgage foreclosures by power of sale)