U.S. Bank National Ass'n v. Burns
406 S.W.3d 495
Mo. Ct. App.2013Background
- Appellant Jeana Burns obtained title by warranty deed in 1999 to property in Chesterfield, Missouri, with title in her name.
- The 2005 Promissory Note was made to Aegis Funding Corporation, secured by a Deed of Trust listing MERS as beneficiary and as nominee for Aegis, with an incorrect legal description.
- Daryl Burns executed a Second Waiver in 2005 waiving marital rights to the Property.
- In 2008, MERS, as nominee for Aegis, assigned its rights in the Deed of Trust and Note to U.S. Bank as Indenture Trustee for the Securities Trust, using the same incorrect property description.
- U.S. Bank filed suit in 2010 seeking to reform the Deed of Trust, the Second Waiver, and the Assignment, and to quiet title in Burns subject to the Deed of Trust; Subdivision filed a cross-claim for subdivision fees in 2011.
- The trial court granted summary judgment reforming the descriptions and declaring the Deed of Trust valid, and granted judgment on the pleadings against Burns for subdivision fees; Burns appeals challenging the enforceability of the Note and the cross-claim liability.”
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether U.S. Bank is entitled to enforce the Deed of Trust. | Burns contends the Assignment was ineffective because MERS was not party to the Note. | U.S. Bank is the holder of the Note through endorsements and possession, making it entitled to enforce the Deed of Trust under the UCC. | Yes; U.S. Bank is the holder and can enforce the Deed of Trust. |
| Whether Burns has an ownership interest triggering subdivision liability. | Burns argues she does not own the Property, thus cannot be liable for subdivision fees. | Burns and Burns’ liability determined by cross-claim; Burns liable for subdivision fees and costs. | The judgment on the pleadings is modified to remove Burns; Subdivision’s judgment against Appellant affirmed as modified. |
Key Cases Cited
- Goetz v. Selsor, 628 S.W.2d 404 (Mo.App.S.D. 1982) (deed of trust passes with the note; enforcement follows the note)
- In re Washington, 468 B.R. 846 (Bankr.W.D.Mo. 2011) (holder of a negotiable instrument entitled to enforce; note and deed of trust enforcement under UCC)
- Bellistri v. Ocwen Loan Servicing, LLC, 284 S.W.3d 619 (Mo.App.E.D. 2009) (endorsement validity where assignor not party to note; challenging an allonge)
- Mitalovich v. Toomey, 206 S.W.3d 361 (Mo.App.E.D. 2006) (modification of judgment under Rule 84.14 when no disputed facts)
- Bremen Bank & Trust Co. of St. Louis v. Muskopf, 817 S.W.2d 602 (Mo.App.E.D. 1991) (definition and enforceability of allonge)
- ITT Commercial Fin. Corp. v. Mid-Am. Marine Supply Co., 854 S.W.2d 371 (Mo.banc 1993) (summary judgment standard and de novo review)