RMS RESIDENTIAL PROPERTIES LLC, et al. v. ANNA M. MILLER A/K/A ANNA K. MILLER et al., SC 18746

Judicial District of New Haven

 Foreclosure; Whether the Plaintiff, as the Holder but not the Owner of a Note, had Standing to Foreclose on a Mortgage Securing the Note; Whether Court Properly Granted Summary Judgment in Favor of the Plaintiff.  The plaintiff commenced this action to foreclose on a mortgage.  The note was executed by the defendant, Anna Miller, in favor of Finance America, LLC, and the mortgage was executed in favor of Mortgage Electronic Registrations Systems, Inc. (MERS), as nominee for Finance America.  The plaintiff alleged that MERS thereafter assigned the mortgage to it and that it subsequently became the holder of the note and the mortgage.  Miller raised several special defenses premised on the following legal theories: (1) that the plaintiff, as a holder but not the owner of the note, did not have standing to bring the action and (2) that even if the plaintiff had standing as the holder of the note, it nevertheless lacked standing because the mortgage had not been assigned to it at the time it commenced the action.  Miller specifically claimed that the mortgage was void ab initio because there was no debt in contemplation or in fact between MERS and herself and that MERS did not own the debt that the mortgage was intended to secure.  She thus claimed that the plaintiff did not acquire any interest in the mortgage by virtue of the assignment.  The trial court granted summary judgment for the plaintiff.  It stated that even assuming the accuracy of Miller’s contention that the plaintiff is the holder but not the owner of the note, the plaintiff still had the right to enforce its terms.  It determined that pursuant to General Statutes § 42a-3-301, a person may be entitled to enforce an instrument even though the person is not the owner of the instrument.  As to Miller’s claim that the plaintiff was required to own the mortgage at the time it commenced the action, the court stated that General Statutes § 49-17 has been interpreted to mean that a holder of a note has standing to bring a foreclosure action without having been assigned the mortgage.  Hence, it found that the plaintiff had standing in spite of the fact that it had not yet been assigned the mortgage at the time it commenced the action.  The trial court subsequently rendered a judgment of foreclosure by sale.  In this appeal, the Supreme Court will determine whether the trial court properly found that the plaintiff had standing and properly granted summary judgment in its favor.