RESTON, Va., April 12, 2013 /PRNewswire/ -- MERSCORP Holdings, Inc. today announced that a five-justice panel of the Rhode Island Supreme Court held that Mortgage Electronic Registration Systems, Inc. (MERS), being named as the mortgagee as the agent of the promissory note-owner of the mortgage, is consistent with Rhode Island law.
In Bucci v. Lehman Brothers Bank, FSB et al., Justice Francis X. Flaherty, writing for the Court, agreed with the trial justice's reasoning surrounding MERS role as the mortgagee, which held that "the fact that MERS acts in a nominee capacity for the lender and the lender's successors and assigns does not diminish MERS's role as the mortgagee nor is there created a new legal term 'nominee-mortgagee.' "
In reviewing the language contained in the mortgage, the Court found the language to be "clear and unequivocal" when defining MERS as the mortgagee and agreed with the trial justice's reasoning by finding that "the plaintiffs explicitly granted the statutory power of sale and the right to foreclose to MERS," and therefore that MERS had the "contractual authority to exercise that right." Supreme Court Justices Maureen McKenna Goldberg, Gilbert V. Indeglia, William P. Robinson III and Chief Justice Paul A. Suttell joined in this opinion.
The justices ruled that none of the plaintiff's myriad arguments held any merit. "[I]t is our opinion that none of the statutes that plaintiffs rely upon prohibit MERS from foreclosing on the Bucci mortgage…" they held. The Justices recognized that in the "modern world of lending" it is no longer the case that the mortgagee and the note-holder are always the same entity. Further, the Court found nothing in the statutes, "despite the feudal roots of these enactments" to "preclude an entity like MERS from acting as the nominee on behalf of the note-owner."