Nationstar Mortg., LLC v. Acre

• Decision Date: 23 July 2015
• Docket Number: SUPERIOR COURT CIVIL ACTION Docket No. RE-12-102
• Parties: NATIONSTAR MORTGAGE, LLC, Plaintiff v. TIMOTHY E. HALF ACRE, Defendant
• Court: Maine Superior Court

NATIONSTAR MORTGAGE, LLC, Plaintiff v. TIMOTHY E. HALF ACRE, Defendant

SUPERIOR COURT CIVIL ACTION Docket No. RE-12-102

Superior Court of Maine

RECEIVED: July 24, 2015

July 23, 2015

STATE OF MAINE

CUMBERLAND, ss

ORDER ON MOTION TO VACATE JUDGMENT AND TO DISMISS

Background

The first complaint for foreclosure filed against defendant Halfacre in June 2009 was dismissed without prejudice. RE-09-134. The second complaint for foreclosure filed in April 2012 resulted in a judgment entered on May 10, 2013 in favor of defendant after trial. RE-12-102. No appeal of the judgment was filed. The third complaint for foreclosure filed in January 2014 resulted in a judgment entered in favor of defendant on a motion for summary judgment. RE-14-047. Defendant's counterclaim in the third action remains pending.

Before the court is plaintiff's motion pursuant to Rules 60(b)(4) and 41(a)(2) to vacate the judgment in the second complaint. RE-12-102. Plaintiff argues it had no standing to commence the suit and the judgment is, therefore, void.¹ A judgment is void when the court issuing the judgment lacks subject matter jurisdiction. See Coombsv. Governmental Employees, Ins. Co., 534 A.2d 676, 678 (Me. 1987); see also M.R. Civ. P. 60(b)(4).

This court concluded after trial on the second complaint, "plaintiff has failed to prove by a preponderance of the evidence that it is entitled to judgment." (5/10/13 Order 5.) Neither standing nor subject matter jurisdiction was addressed during trial.

Discussion

The Superior Court has subject matter jurisdiction over complaints for foreclosure. 4 M.R.S. §§ 105, 152(5)(H) (2014); 14 M.R.S. §§ 6321-6326 (2014). In Norris Family Assocs., LLC v. Town of Phippsburgh, which involved a Rule 80B appeal, the Law Court announced that standing and subject matter jurisdiction are separate issues and did not follow its prior approach of considering standing as an element of subject matter jurisdiction. 2005 ME 102, ¶¶ 12-13, 879 A.2d 1007.

Since Norris Family Assocs., LLC, however, the separation between standing and jurisdiction has not been maintained consistently. In Mortgage Elec. Registration Sys. v. Saunders, the Law Court did not cite authority, but concluded plaintiff "lacked standing to institute foreclosure proceedings and could not invoke the jurisdiction of our trial courts." 2010 ME 79, ¶15, 2 A.3d 289. The court in Saunders stated, "a party's personal stake in the litigation is evidenced by a particularized injury to the party's property, pecuniary, or personal rights," and cited, among other cases, Stull v. First Am, Title Co. Saunders, 2010 ME 70, ¶ 7, 2 A.3d 289 (citing Stull, 2000 ME 21, ¶ 11, 745 A.2d 975). Stull provides that the issue of standing is jurisdictional and cites Singal v. Bangor. See Stull, 2000 ME 21, ¶ 11, 745 A.2d (citing Singal, 440 A.2d 1048, 1050 (Me. 1982). In Singal, the Law Court treated a party's standing to appeal an administrative decision as being an element of the court's subject matter jurisdiction. 440 A.2d at 1050.The Court in Norris Family Assocs., LLC overruled this portion of Singal. 2005 ME 102, ¶ 13, 879 A.2d 1007.

In TP Morgan Chase Bank v. Harp, the Law Court stated, "standing relates to the court's subject matter jurisdiction and may be raised at any time, including during an appeal," and cited Francis v. Dana-Cummings. Harp, 2011 ME 5, ¶ 7, 10 A.3d 718 (citing Francis, 2007 ME 16, ¶ 20, 915 A.2d 412). The paragraph in Francis cited in Harp provides, "a court may notice and act on a question regarding its authority at any time, either on its own or on motion of any party." Francis, 2007 ME 16, ¶ 20, 915 A.2d 412 (citations omitted). Francis involved a challenge to the court's subject matter jurisdiction under a specific statute and did not address the relationship between standing and subject matter jurisdiction. See id. ¶ 21.

Most recently, in Bank of Am., N.A. v. Greenleaf, the Law Court concluded that the bank lacked standing to seek foreclosure on a mortgage and accompanying note, but did not discuss jurisdiction. 2014 ME 89, ¶ 17, 96 A.3d 700. The court in Greenleaf did cite both Harp and Saunders. 2014 ME 89, ¶ 9, 96 A.3d 700

Notwithstanding the inconsistencies in the relationship between subject matter jurisdiction and standing, the Law Court has affirmed a judgment in favor of a defendant after trial when the plaintiff did not have standing. See Sturtevant v. Town of Winthrop 1999 ME 84, ¶¶ 1, 6, 23, 732 A.2d 264. In Sturtevant, the Law Court affirmed the trial court's granting defendant's motion for a judgment notwithstanding the verdict based on defendant's argument that plaintiff lacked standing. Id. The Law Court also has vacated a judgment in favor of the plaintiff following a bench trial. Deutsche Bank Nat'l Trust Co. v. Wilk, 2013 ME 79, ¶¶ 1, 22, 76 A.3d 363. In Wilk, the Law Court vacated a judgment of foreclosure and remanded for entry of judgment indefendant's favor. See id. ¶¶ 1, 22. The Law Court determined plaintiff did not prove at trial that plaintiff owned the mortgage. Id.

Faced with this history, this court favors a judgment's finality over validity. The Law Court has stated, "[t]he more recent trend in the law is to favor finality over an absolute requirement of validity." Standish Tel. Co. v. Saco River Tel. & Tel. Co., 555 A.2d 478, 481 (Me. 1989)(citation omitted). In Standish, the Law Court determined that although a subsequent case clarified and limited the authority of the Public Utilities Commission (PUC), the PUC's order from 1938 was not appealed and had the effect of a judgment. See id. The Law Court relied on the Restatement (Second) of Tudgments (1982) to conclude the PUC's jurisdiction to enter the order, which was sought by the parties, was res judicata. See id. at 480-81. The favoring of "finality over an absolute requirement of validity," discussed in Standish, is especially important in judgments affecting real estate.

If a court has subject matter jurisdiction, an unappealed judgment is valid and becomes res judicata. In Ervey v. Northeastern Log Homes, the Workers' Compensation Board nullified a 1986 unappealed decree of the Workers' Compensation Commission. 638 A.2d 709, 709-11 (Me. 1994). The Board determined the decree was null and void because the Commission had no authority to require defendant to pay plaintiff benefits. Id. at 710. The Law Court reversed and stated:

It is well established that a valid judgment entered by a court, if not appealed from, generally becomes res judicata and is not subject to later collateral attack. We have recognized a strong policy in favor of ending litigation and giving finality to court judgments. Balanced against a policy favoring finality, however, is a requirement that in order to become final, a judgment must be valid.

. . . .The "validity" of a judgment depends upon whether a tribunal has subject matter jurisdiction and territorial jurisdiction and whether adequate notice has been afforded to a party.

Ervey, 638 A.2d at 710-11 (internal quotation marks and citations omitted). Citing the Restatement (Second) of Judgments, the Law Court determined "the subject matter of the action was [not] so plainly beyond the [Commission's] jurisdiction that its entertaining the action was a manifest abuse of authority." Id. at 711 (citing Restatement (Second) of Judgments § 12(1) (1982)). Accordingly, the Law Court determined the Commission's decree was valid and entitled to res judicata effect.² Id.

Conclusion

Although the plaintiff lacked standing to prove that it was entitled to judgment on its second complaint for foreclosure, the lack of standing does not provide a basis to vacate an unappealed judgment for the defendant, entered after trial in the Superior Court. This court's judgment is valid and entitled to res judicata effect.

The entry is

Plaintiff's Motion to Vacate Judgment and Dismiss Complaint without Prejudice is DENIED.

Dated: July 23, 2015

/s/_________

Nancy Mills

Justice, Superior Court

JONATHAN FLAGG ESQ

FLAGG LAW PLLC

93 MIDDLE ST

PORTSMOUTH NH 03801

FRANK D'ALLESANDRO ESQ

PINE TREE LEGAL ASSISTANCE

PO BOX 547

PORTLAND ME 04112

ORDER ON PLAINTIFF'S COMPLAINT FOR FORCLOSURE

Jury-waived trial³ was held on the plaintiff's complaint for foreclosure, filed on 3/30/12. The defendant was served with the complaint on 4/4/12. He filed an answer on 4/19/12. The requirement for foreclosure mediation was vacated by order dated 7/5/12 because paperwork was not provided to the court.

The plaintiff filed a motion for summary judgment on 7/30/12. The defendant filed opposition to the motion. On 11/15/12, the plaintiff's motion for summary judgment was denied because the plaintiff failed to establish the foundation necessary to allow consideration of the plaintiff's representative's testimony and referenced business records.

The court has considered the testimony and exhibits, as well as the entire file. The court also has listened to the recording of the entire trial. For the following reasons, judgment is entered in favor of the defendant on the plaintiff's complaint.

HISTORY

The documents admitted in evidence purport to show the following. The defendant⁴ purchased property located at 55 Huntress Avenue, Westbrook, Maine. (Pl.'s Ex. 1.) He signed a promissory note and mortgage;⁵ the lender was Residential Mortgage Services, Inc. (Pl.'s Exs. 2-3.)⁶ The note was transferred by Residential Mortgage to SunTrust and endorsed in blank by SunTrust. (Pl.'s Ex. 2.)

The mortgage was assigned by MERS, as nominee for Residential Mortgage, to SunTrust on 6/4/09 and by SunTrust to Nationstar on 5/24/11. (Pl.'s Exs. 5, 7.) The mortgage was also assigned by MERS, as nominee for Residential Mortgage, to Nationstar on 12/6/10.⁷ (Def.'s Ex. D.) The assignment from SunTrust to Nationstar was executed by Nationstar as attorney-in-fact for SunTrust. The attorney-in-fact form is not notarized or witnessed. (Pl.'s Ex, 5.) The assignment from MERS to SunTrust is signed by Roxanne Lockett as Vice...