BANK OF NEW YORK V. BORREGO
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THE BANK OF NEW YORK MELLON
f/k/a THE BANK OF NEW YORK AS
TRUSTEE FOR THE CERTIFICATE
HOLDERS OF THE CWABS, INC.,
ASSET-BACKED CERTIFICATES,
SERIES 2005-9,
Plaintiff-Appellee,
v.
KENNETH BORREGO AND THE
UNKNOWN SPOUSE OF KENNETH
BORREGO, IF ANY,
Defendants-Appellants.
COURT OF APPEALS OF NEW MEXICO
APPEAL FROM THE DISTRICT COURT OF SANTA FE COUNTY,
Raymond Z. Ortiz, District Judge
Rose L. Brand & Associates, P.C.,
Eraina Edwards, Albuquerque, NM, for Appellee
Joshua R. Simms, P.C., Joshua R. Simms,
Albuquerque, NM, for Appellants
JAMES J. WECHSLER, Judge. WE CONCUR:
MICHAEL D. BUSTAMANTE, Judge, JONATHAN B. SUTIN, Judge
AUTHOR: JAMES J. WECHSLER
{1} Defendant Kenneth
Borrego (Homeowner) appeals from the district court’s entry of “summary
judgment, decree of foreclosure, and appointment of special master” [RP 214] in
favor of Plaintiff Bank of New York Mellon (the Bank).We issued a notice of
proposed disposition proposing to affirm, and Homeowner has responded with a
memorandum in opposition. We have carefully considered the arguments raised in
that memorandum; however, for the reasons stated in the notice of proposed
disposition and below, we continue to believe that summary affirmance is
appropriate in this case. We therefore affirm the district court’s decision.
{2} Our notice proposed
to hold that the Bank established its standing as a holder in due course of the
note at issue on the basis that it had possession of the original note,
indorsed in blank, at the time of the filing of the complaint. [RP 9, 22,
224-26] Further, we proposed to reject Homeowner’s challenge to the Bank’s
standing based on the validity of a mortgage assignment by Mortgage Electronic
Registration Systems, Inc. (MERS), based on our recent decision in
Flagstar
Bank, FSB v. Licha (Flagstar I), ___-NMCA-___, ¶ 18, ___ P.3d ___ (No.
33,150, Feb. 18, 2015). We do not reiterate our analysis here; instead, we
focus on Homeowner’s arguments in his memorandum in opposition.
{3} In response to our
notice, Homeowner makes two arguments. First, he claims that the Bank “may be
the holder of the note, but has not established it is the owner of the note.”
[MIO 2] Second, Homeowner concedes that with respect to the assignment of the
mortgage, this issue has been resolved by our case law, but asks this Court to
reconsider the issue. [MIO 2-5] We reject Homeowner’s first argument because we
perceive no distinction in this context between the words “holder” and “owner.”
We acknowledge Homeowner’s citation to
Bank of New York v. Romero,
2014-NMSC-007, ¶ 17,
320 P.3d 1, [MIO 2] wherein our Supreme Court held that a
party attempting to enforce a note has the “the burden of establishing timely
ownership
of the note and the mortgage to support its entitlement to pursue a foreclosure
action.” (Emphasis added). However, when read in context, it is clear that this
statement in
Romero was simply another way of saying that the party must
be entitled to enforce the note.
See Flagstar Bank, FSB v. Licha (Flagstar
II), ___-NMCA-___, ¶ 13, ___ P.3d ___ (No. 33,150, June 4, 2015) (citing
paragraph in
Romero containing “ownership” language Homeowner relies on
for the proposition that plaintiffs in foreclosure actions “must demonstrate
that they had the right to enforce the note” at the time the action is filed).
Being a “holder,” as defined by NMSA 1978, Section
55-3-301 (1992), is one way
of showing entitlement to enforce a note.
Romero,
2014-NMSC-007, ¶¶
20-21. In other words, being the “owner” is not a different or additional
requirement of establishing the authority to enforce a note.
See Bank of
N.Y. Mellon v. Lopes,
2014-NMCA-097, ¶¶ 9-10,
336 P.3d 443 (explaining that
“‘holder’ is a term of art” and carries with it the authority to enforce a
note).
{4} As for Homeowner’s
second argument, we acknowledge that this Court partially granted a motion for
rehearing in
Flagstar I and recently issued a different opinion in place
of the opinion filed February 18, 2015. Nonetheless, the modification of the
Flagstar
I opinion does not change the outcome of this case. In this Court’s opinion
filed on June 4, 2015, we again rejected the homeowner’s argument that the
plaintiff lacked standing to enforce the note at issue because MERS lacked the
authority to assign the note.
Flagstar II, ___-NMCA-___, ¶ 17. As in
Flagstar
II, Homeowner’s failure to “distinguish[] MERS’ role in this case from
MERS’ role in
Romero, does not undermine the Bank’s standing in this
case.
See Flagstar II, ___-NMCA-___, ¶ 17. In short, there are no material
distinctions to remove this case from the control of our opinion in
Flagstar
II and we therefore reject Homeowner’s challenge to Plaintiff’s standing
based on the validity of a mortgage assignment by MERS.
{5} Based on the
foregoing as well as the discussion in the notice of proposed disposition, we
affirm the district court’s decision in this case.
MICHAEL D. BUSTAMANTE, Judge