Rhode Island Judge Dismisses Complaint Against MERS

A judge in Rhode Island ruled in favor of ""Mortgage Electronic Registration Systems, Inc."":http://www.mersinc.org/ (MERS) and co-defendants and dismissed arguments of wrongful foreclosure from the plaintiff.

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In _Van Hoecke v. First Franklin Financial Corporation_, the court determined that since the material facts were similiar to the facts underlying a previous decision in _Payette v. Mortg. Elec. Registration Sys., Inc._, the court used the same reasoning established in Payette.

In the case, First Franklin Financial Corporation, the lender, assigned the mortgage to MERS, who as mortgagee and as nominee for First Franklin, then assigned the mortgage to LaSalle Bank.

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LaSalle, as mortgagee, began the foreclosure proceedings against the homeowner and was the successful bidder when the property went to sale.

The plaintiff then attempted to argue the defendants were actually not authorized to foreclose on the property. In response to the argument, Superior Court Justice Allen P. Rubine wrote, ""It is well-established that MERS and an assignee of MERS, such as LaSalle, may properly invoke the statutory power of sale as granted to the mortgagee by the plain, unambiguous language of the Mortgage. Plaintiff, through her acknowledgement and execution of the Mortgage, explicitly granted to MERS, and to the successors and assigns of MERS, the right to exercise the statutory power of sale and to foreclose on the Property.""

The plaintiff also argued the mortgage servicers may not conduct a non-judicial foreclosure sale and are limited in functions they can perform on behalf of the mortgagee.

Home Loan Services was the servicer in the case and executed the foreclosure deed on behalf of LaSalle.

However, the court pointed out that, ""Rhode Island law clearly establishes a role for mortgage servicers in the mortgage industry as mortgage servicers are included within the definition of 'mortgagee'....Thus, Home Loan, as servicer of LaSalle, the mortgagee and note holder, was properly authorized to execute the foreclosure deed on behalf of LaSalle.""