IN RE MATTER OF THE FORECLOSURE OF TAX LIENS, 2010 NY Slip Op 30628 – NY: Supreme Court, Wayne 2010 MERS

In the Matter of the Foreclosure of Tax Liens by Proceeding In Rem Pursuant to Article 11 of the Real Property Tax Law by the County of Wayne Regarding 2007 Town/County Tax.

MERS claims that the proceedings and ensuing conveyances of 4664 Smith Road were defective, because MERS was not separately noticed. There are at least two difficulties with this claim. First, the argument assumes that the County has a duty to read the Mortgage to determine whether anyone else other than the Mortgagee had a cognizable property interest warranting statutory notice under RPTL §1125. This Court does not believe this is or should be the case. The County should not have to go behind a title search to determine whether any property interests are conveyed to third parties not a party to an instrument on file. To accept MERS’ argument would require the County to read every mortgage from A to Z to make sure there are no “Nominees” of the Lender entitled to notice of tax foreclosure in lieu of or in addition to the Lender. Indeed, RPTL §1126(A) provides a vehicle for someone like MERS to receive notice without requiring the County to read every mortgage to determine whether notice should be given.

Second, the Mortgage from which MERS derives its claim of right to statutory notice under RPTL §1125 is by no means crystal clear as to what MERS’ involvement as `’Nominee” requires after the recording of the mortgage. Indeed. MERS does not explain what role the “Nominee” plays in the recording of a mortgage, or thereafter, except perhaps as something akin to a power-ofattorney or agent, albeit with independent standing. If the later is the case, it is incumbent upon the “”Nominee” to state its status as one due notice in the separate declaration of interest form required under section RPTL § 1126, which the County does have a categorical duty to read.

According, the application of MERS shall be, and the same hereby is, denied. 


One Response

  1. MERS and LPS are trying to rewrite all the statutes regarding law of mortgages and negotiable instruments in these courtrooms——–they are going to take these defeats ——-spin them -and tell legislature to rein in the courts -excuse to enlarge authority of bank system to act unilaterally to increase the angle of slope we face if you attempt to defend against predatory loans and collections

    what they will ask is a law change that “presumes that the industry record system is correct unless clear and convincing evidence is provide by defendant that there was a material mistake that alters the defendants liability” -something like that—the fight has got to go to the legislative branches

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