Macera v. Mortg. Elec. Registration Sys., Inc.

• Decision Date: 14 June 2013
• Docket Number: Nos. 12–1778,12–1795.,s. 12–1778
• Citation: 719 F.3d 46
• Parties: Frank MACERA, Jr., Plaintiff, Appellee, v. MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., et al., Defendants, Pawtucket Credit Union, Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

719 F.3d 46

Frank MACERA, Jr., Plaintiff, Appellee,

v.MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., et al., Defendants, Pawtucket Credit Union, Defendant, Appellant.

Nos. 12–1778, 12–1795.

United States Court of Appeals, First Circuit.

June 14, 2013.

Joel J. Votolato, with whom Joel T. Gannon was on brief, for appellant.

George E. Babcock for appellee.

Before HOWARD, Circuit Judge, SOUTER,^* Associate Justice, and LIPEZ, Circuit Judge.

SOUTER, Associate Justice.

This is one of the cases on the District Court's Master Foreclosure docket described in In re: Mortgage Foreclosure, decided today.¹ The appeal calls into question both the injunction held in that case to have been issued in error and to be addressed on remand, and the district court's subject-matter jurisdiction owing to allegedly incomplete diversity of parties required under 28 U.S.C. § 1332. A motion to dismiss on that latter ground was “refused and returned,” by an erroneous order of the district court, and we remand this case for prompt adjudication of the motion, if appropriate after the court has taken the remedial action required by In re: Mortgage Foreclosure.

Although the case implicates a host of issues deferred or refused consideration by the district court on the ground of “Case Management,” the facts and procedural history necessary for our determination at this point can be stated briefly. The plaintiff-appellee, Frank Macera, Jr., was lent money by Nation One Mortgage Company, Inc., secured by a first mortgage of Rhode Island real estate naming Mortgage Electronic Registration Systems, Inc. (MERS) as mortgagee. MERS ostensibly assigned its interest to Federal National Mortgage Association (FNMA) for foreclosure upon Macera's default. The intervenor defendant-appellant, Pawtucket Credit Union, purchased the property at foreclosure, presumably to protect its interest as second mortgagee.

When Pawtucket took steps to evict Macera, he invoked the district court's diversity jurisdiction to entertain a “Complaint For Declaratory Judgment And Injunctive Relief,” to the effect that the foreclosure proceedings were ineffective, the foreclosure title void, and Macera still the owner of the mortgaged property. The complaint named as defendants Nation One, MERS and FNMA. Macera was described as a Rhode Island resident; the defendants were shown as having addresses outside the state.

Pawtucket moved to intervene as a defendant under Federal Rule of Civil Procedure 24(a)(2), as a party claiming an interest that might be impaired by the litigation. Once the motion was granted, Pawtucket moved to dismiss the action for want of complete diversity of parties required under 28 U.S.C. § 1332, since Pawtucket was a Rhode Island resident corporation. See Picciotto v. Cont'l Cas. Co., 512 F.3d 9, 21 (1st Cir.2008) (“Incomplete diversity destroys original jurisdiction with respect to all claims....” (quoting Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 554, 125 S.Ct. 2611, 162 L.Ed.2d 502 (2005))). As mentioned before, instead of ruling on the motion, the district court ordered the motion document itself to be returned to Pawtucket on the ground that “[t]his case is stayed pursuant to the Case Management order,” described in In re Mortgage Foreclosure. Pawtucket then brought this appeal, objecting to the stay as being an injunction issued in denial of its due process right to notice and hearing, and challenging the court's refusal even to docket the motion to dismiss for lack of the complete diversity of parties required for subject-matter jurisdiction.

Although Macera claims that this court lacks appellate jurisdiction, the answer is set out in In re Mortgage Foreclosure: the “stay” from which Pawtucket appeals is an injunction subject to interlocutory appellate jurisdiction under 28 U.S.C. § 1292(a)(1), and Pawtucket is an enjoined party entitled to be heard promptly on its objection, in belated compliance with Fed.R.Civ.P. 65(a)(1), regardless of any due process consideration. As explained in In re Mortgage Foreclosure, it is unnecessary to go beyond saying that Pawtucket's particular objection to jurisdiction, like the global claims described in that companion case, will require adjudication, at...