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Connecticut: Court Finds Jurisdiction Despite Stationery Header

Posted By USFN, Monday, November 25, 2013
Updated: Wednesday, October 14, 2015

November 25, 2013


by Jeffrey M. Knickerbocker
Hunt Leibert – USFN Member (Connecticut)

On October 30, 2013, in a case captioned U.S. Bank, National Association successor-in-interest to Wachovia Bank, N.A. as Trustee of JP MORGAN 2004-A3 v. Bailey, docket number FST-CV-10-6003100-S, the court found that the plaintiff had standing. The defendants filed a confusing motion to dismiss, alleging nine separate reasons for dismissing the action. The court did not find in favor of defendants on any of the alleged jurisdictional deficiencies.

The court held an evidentiary hearing to consider the defendants’ motion to dismiss. The plaintiff’s witness was employed by PHH Mortgage. At the hearing, the plaintiff’s witness introduced the note. Testimony established that the defendants had executed the note in favor of Merrill Lynch Credit Corporation. The note contained endorsements, which according to the witness, were all placed on the note in 2004. The court found this testimony credible because the trust was formed in 2004, as evidenced by the name of the plaintiff. The witness also introduced into evidence the mortgage and the mortgage assignment to the plaintiff. Defendants’ counsel did not elicit anything of note in cross-examination.

The defendants’ only evidence was hundreds of pages of correspondence from the servicer (Cendant Mortgage and, later, PHH Mortgage). Each page of correspondence had either of those names on the right corner. In the left corner, each page contained the name “Merrill Lynch Credit Corporation.” The defendants’ theory of the case was that Merrill Lynch Credit Corporation was the only entity entitled to enforce the mortgage, despite the endorsements, testimony, and assignment of mortgage. The court found that the letters established that PHH was, in fact, the servicer for this loan.

The plaintiff’s witness rebutted the defendants’ exhibit by explaining that the loan number on the correspondence showed who the investor was for the note and mortgage. Plaintiff’s witness further testified that the loan number established that the plaintiff, not Merrill Lynch Credit Corporation, was the proper plaintiff.

The court ruled that the plaintiff’s evidence sufficiently established standing, and found that the defendants failed to prove that any other party had standing. The defendants failed to provide any evidence regarding the authority of the persons who endorsed the note. The court also found that the defendants failed to offer any evidence regarding the endorsements, despite having raised the argument in the written motion to dismiss. The defendants’ motion pointed out that two of the endorsements had been signed by the same person for two separate entities. However, the endorsements clearly showed that he was an agent for one of the entities, and the defendants failed to produce any evidence that the endorser did not have authority to execute the allonge.

While the plaintiff was successful in this matter, the case underscores the importance of correspondence being correct. Had the letters not had the name “Merrill Lynch Credit Corporation” on them, the defendants would have been deprived of any evidence whatsoever. All correspondence to borrowers should be clear and accurate, and there should not be any extraneous information, such as the name of the original lender in the letterhead.

Editor’s Note: The author’s firm represented the plaintiff in the matter summarized in this article.

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