Section Review

In Bank of New York v. KC Bailey,¹ the Supreme Judicial Court undertook to answer the question of whether or not the Housing Court has the authority to determine validity of title as a defense in a summary process action after a mortgage foreclosure sale.

In 2005, Bailey had given a mortgage to the Mortgage Electronic Registration System (MERS) as nominee for America's Wholesale Lender.² The mortgage (apparently) became part of a group of mortgages securitized with Bank of New York as trustee.³ In 2007, MERS, as nominee, foreclosed the mortgage and was the highest bidder at the foreclosure sale and assigned the deed to Bank of New York.⁴ Bank of New York subsequently brought a summary process action seeking to evict Bailey.⁵

Bailey, among other defenses, raised the defense that Bank of New York was not the owner because the sale was not in compliance with the foreclosure statute, due to defective notice, and the deed was thus void.⁶

The record indicates Bailey claimed to have not received any notice of the foreclosure.⁷ Bank of New York submitted to the court a copy of the foreclosure deed and of the legal notice for the sale, but the date of publication was illegible.⁸ Bank of New York filed a motion for summary judgment, asserting that it was the owner as a result of the foreclosure.⁹

The justice in the Housing Court action allowed Bank of New York's motion, stating that the only issue before the court was whether the plaintiff is entitled possession, and because the plaintiff showed that its deed was recorded prior to the service of the notice to quit, Bank of New York had established a prima facie case for possession.¹⁰ Bailey appealed.

The SJC summarily found that the Housing Court has statutory jurisdiction over summary process actions, but stated that the issue was in this case whether or not the defense of an imperfectly conducted foreclosure, and thus no standing, was within the scope of the court's authority.¹¹ Citing New England Mut. Life Ins. Co. v. Wing,¹² the court stated that a challenge to the landlord's entitlement to possession has long been considered a valid defense to summary process, particularly where the property was purchased at a foreclosure sale.

The court further cited cases dating back to 1700, finding that the "summary remedy" provided a remedy to those entitled to the premises.¹³ This requires proof of the right to possession and that legal title obtained by foreclosure may be questioned.¹⁴ Indeed, it is incumbent upon a purchaser at foreclosure sale to establish his right to possession in a summary process action.¹⁵

The SJC applied the standard for summary judgment indicating that Bank of New York had the burden of showing that when no material facts in dispute regarding the legal title to the property.¹⁶ The court stated that such a plaintiff is required to make a prima facie showing that (1) it obtained the deed to the property at issue and that (2) the deed and affidavit of sale, showing compliance with statutory foreclosure requirements, were recorded.¹⁷ As Bank New York failed to submit the affidavit of sale, the Court vacated the allowance of the motion for summary judgment and remanded the case to the Housing Court.¹⁸

The practice note to be drawn from this is that legal title is a predicate to standing for bringing a summary process action following a foreclosure. In any such summary process action, the best practice would be for plaintiff's attorney to introduce into evidence a certified copy of the foreclosure deed and also a certified copy of the affidavit of sale, showing compliance with the statutory foreclosure requirements.

Alfred Geoffrion Jr. has practiced for 26 years in Springfield. He concentrates in real estate law and conveyancing as well as probate and estate law. A graduate of Western New England School of Law, he currently is a member of the East Longmeadow Zoning Board of Appeals.

¹460 Mass. 327 (2011).
²Id.  at 330.
³Id.
⁴Id.
⁵Id.
⁶See U.S. Bank Nat'l Ass'n v. Ibanez, 458 Mass. 637, 646 (2011).
⁷KC Bailey, 460 Mass. at 329-30.
⁸Id.  at 329 n.4.
⁹Id.  at 329.
¹⁰Id.  at 331.
¹¹Id.  at 331-32.
¹²191 Mass. 192, 195 (1906).
¹³(emphasis added)
¹⁴Wayne Inv. Corp. v. Abbott, 350 Mass. 775, 775 (1966) (citing Sheehan Constr. Co. v. Dudley, 299 Mass. 51, 53 (1937) and New England Mut. Life Ins. Co. v. Wing, 191 Mass. at 195, 196).
¹⁵Sheehan, 299 Mass. at 53.
¹⁶KC Bailey, 460 Mass. at 334.
¹⁷See Lewis v. Jackson, 165 Mass. 481, 486-87 (1896); MASS. GEN. LAWS. c. 244 § 15 (2011).
¹⁸KC Bailey, 460 Mass. at 334-35.