Bandler v. Bank of N.Y. Mellon Tr.
| Docket Number | 23-AP-189 |
| Decision Date | 15 December 2023 |
| Parties | Michael Bandler* v. Bank of New York Mellon Trust |
| Court | Vermont Supreme Court |
In the case title, an asterisk (*) indicates an appellant and a double asterisk (**) indicates a cross-appellant. Decisions of a three-justice panel are not to be considered as precedent before any tribunal.
APPEALED FROM: Superior Court, Windsor Unit, Civil Division CASE NO. 22-CV-01710 Trial Judge: Samuel Hoar, Jr.
In the above-entitled cause, the Clerk will enter:
Plaintiff Michael Bandler appeals the dismissal of his declaratory judgment action against defendant Bank of New York Mellon Trust (BONY).[*] We affirm.
In 2019, BONY filed an action against plaintiffs partner, Debra Tyler, to foreclose on a mortgage secured by property that she owned in Benson, Vermont. Plaintiff sought to intervene in that action, asserting that he had purchased an interest in the property. The trial court denied plaintiffs motion to intervene because he had not filed a recorded deed to prove his ownership. Plaintiff and Tyler then moved for permission to take an interlocutory appeal, which this Court denied in February 2022 because the request was untimely. See Bank of N.Y, Mellon Tr. v. Tyler, No. 22-AP-030 (Vt. Feb. 15 2022) (unpub. mem.).
In May 2022, plaintiff filed this declaratory judgment action against BONY. Plaintiff asserted in his complaint that he was a record owner of an interest in the Benson property. He claimed that BONY's foreclosure action against Tyler was barred by the statute of limitations; Tyler was fraudulently induced to sign the mortgage agreement; BONY failed to give the required notices to Tyler before commencing the mortgage or assigning it; BONY improperly gave a reverse mortgage to Tyler; and plaintiff was denied due process because he was not allowed to intervene in the foreclosure action. Plaintiff sought a declaration that the foreclosure action "may not conclude in [d]efendant's favor."
The court granted BONY's motion to dismiss plaintiffs complaint, concluding that plaintiff lacked standing to assert his claims regarding Tyler because he was not a party to the original loan transaction or the foreclosure action and all his claims were effectively an
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impermissible collateral attack on the foreclosure action. It reasoned that plaintiffs proper avenue for relief was a direct appeal from the foreclosure action when that action concluded. This appeal followed.
On appeal, plaintiff argues that he has standing to bring his declaratory judgment claims regarding Tyler because his ownership interest in the Benson property will be injured if BONY is allowed to foreclose upon the property. However, each of plaintiff s first five claims assert defenses to the foreclosure action personal to Tyler, not to plaintiff. Regardless of whether plaintiffs after-acquired interest in the property was sufficient to make him an indispensable party to the foreclosure proceeding, it does not give him the right to separately assert claims that may arise from the contract between Tyler and BONY. "Like the federal courts, we generally do not allow third-party standing." Baird v. City of Burlington, 2016 VT 6, ¶ 15 201 Vt. 112. Plaintiff is not a party to the mortgage between Tyler and BONY, nor does he claim to be a third-party beneficiary of that contract. Accordingly, he cannot challenge the validity of the contract in a declaratory judgment action. See Bischoff v. Bletz, 2008 VT 16, ¶ 16, 183 Vt. 235 (...
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