Salvatore Munaco v. Bank of America
513 F. App'x 508
6th Cir.2013Background
- Munaco obtained a $1,190,000 loan on residential property in Rochester, Michigan, secured by a mortgage with MERS named as mortgagee.
- BNYM, as owner of the indebtedness (through assignment), began foreclosure on June 2, 2009, before its June 25, 2009 recording of the mortgage assignment.
- The foreclosure sale occurred on July 28, 2009, after four adjournments, with BNYM purchasing the property for $697,000.
- The redemption period expired on July 28, 2010, and Munaco did not redeem; case proceeded in district court, then was removed to federal court.
- The district court granted summary judgment for Defendants on January 24, 2012, holding that adjournments complied with Mich. Comp. Laws Ann. § 600.3220 and rejecting additional claims under § 600.3204; Munaco moved for reconsideration and to amend, which the court denied on February 28, 2012.
- Munaco appeals both the summary judgment ruling and the denial of leave to amend.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the foreclosing adjournments complied with § 600.3220 | Munaco argues flaws in adjournment notices allow challenge to foreclosure. | BNYM contends adjournments followed statute; plaintiff’s claims limited to § 600.3220. | Summary judgment proper on adjournment compliance. |
| Whether the assignment recording timing violated § 600.3204 | Assignment not recorded before foreclosure began; invalidates sale. | Recording before sale suffices; owner of indebtedness foreclosed lawfully. | Court held recording before sale satisfied § 600.3204(3); Saurman overruled to the extent inconsistent. |
| Whether amending the complaint was inappropriate | amendment should relate to other statutory claims. | prejudice and delay bar amendment; Rainey did not alter controlling law. | No abuse of discretion in denying leave to amend. |
| Whether amendment would have been futile | amended claims would state viable violations. | applicable law fixed; amendment would fail. | Amendment would be futile; district court proper. |
Key Cases Cited
- Residential Funding Co., LLC v. Saurman, 805 N.W.2d 183 (Mich. 2011) (foreclose by advertisement includes mortgagees of record and owners of indebtedness; recording must precede sale)
- Kim v. JP Morgan Chase Bank, N.A., 813 N.W.2d 778 (Mich. Ct. App. 2012) (analysis of § 600.3204 and assignment timing)
- Piotrowski v. State Land Office Bd., 4 N.W.2d 514 (Mich. 1942) (post-foreclosure ownership and title effects in Michigan)
- Schulthies v. Barron, 167 N.W.2d 784 (Mich. App. 1969) (no equitable extension of redemption absent fraud or irregularity)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard requires plausible claims, not mere suspicion)