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Bayview Loan Servicing, LLC v. Providence Business Loan Fund, Inc.

Supreme Court of Rhode Island

January 29, 2019

Bayview Loan Servicing, LLC
v.
Providence Business Loan Fund, Inc., f/k/a Providence Economic Development Corporation, et al.

          Providence County Superior Court (PC 17-1029) Associate Justice Maureen B. Keough

          For Plaintiff: Brittanee N. Bland, Esq. Thomas C. Plunkett, Esq

          For Defendant: Stephen A. Izzi, Esq. Tenessa H. Azar, Esq.

          Present: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.

          OPINION

          PAUL A. SUTTELL CHIEF JUSTICE

         This case involves a question of statutory interpretation of the ancient mortgages statute, G.L. 1956 § 34-26-7. The defendant, Providence Business Loan Fund, Inc. (PBLF or defendant), appeals from a Superior Court judgment in favor of the plaintiff, Bayview Loan Servicing, LLC (Bayview or plaintiff), following the grant of the plaintiff's motion for summary judgment. The defendant argues that the hearing justice erred in granting the plaintiff's motion for summary judgment because, by statute, the defendant holds a valid mortgage on the property on which the defendant commenced foreclosure proceedings. This case came before the Supreme Court pursuant to an order directing the parties to appear and show cause why the issues raised in this appeal should not be summarily decided. After considering the parties' written and oral submissions and reviewing the record, we conclude that cause has not been shown and that this case may be decided without further briefing or argument. For the reasons set forth in this opinion, we affirm the judgment of the Superior Court.

         I Facts and Travel

         On June 2, 1992, Norris Waldron (Waldron) granted a mortgage to PBLF, which was at that time known as "Providence Economic Development Corporation," with respect to certain real property located in Providence (the property), as security for a loan in the amount of $70, 660 (the 1992 mortgage). The 1992 mortgage stated a term of ten years, but it did not specify a maturity date; it was recorded in the Providence land evidence records at Book 2568, Page 50, on June 3, 1992. On December 20, 1996, Waldron entered into a "Modification Agreement" with defendant to reduce the amount of debt to $44, 061.75, to be repaid over a period of 108 months, beginning on January 1, 1997 (the modification agreement). The modification agreement was not recorded. On the same day, Waldron and defendant also executed an amendment to the 1992 mortgage (the 1997 amendment), which was recorded on January 3, 1997, in the Providence land evidence records. The 1997 amendment states, in relevant part, that the 1992 mortgage "has been modified, with the consent of mortgagor, by an agreement of even date herewith, to modify the terms and to extend the maturity date of said indebtedness to reduce the amount of the indebtedness which is secured by said mortgage to $44, 061.75." On its face, the 1997 amendment failed to reflect the 108-month term listed in the modification agreement and it did not specify any other term or maturity date.

         On January 23, 2004, Waldron conveyed the property to Jocelyn Waldron by quitclaim deed. On June 21, 2014, Jocelyn[1] granted a mortgage on the property to MERS, as nominee for Equity One, Inc., which was recorded in the Providence land evidence records. Three years later, Jocelyn paid off that debt using the proceeds of a loan from Global Equity Lending, Inc., which was secured by a mortgage on the property; that mortgage was assigned by Global Equity Lending, Inc. to plaintiff on June 19, 2007, and an assignment of the mortgage and security agreement was recorded in the Providence land evidence records.

         Jocelyn later conveyed the property to Broad Street, LLC by warranty deed on October 29, 2014. On February 8, 2017, defendant gave notice to Broad Street, LLC of its commencement of foreclosure proceedings on the 1992 mortgage. On March 6, 2017, plaintiff, as a lienholder on the property, filed a complaint in Superior Court seeking a declaration that defendant's mortgage had been discharged under § 34-26-7, which provides for the expiration of certain mortgages after a stated number of years, and that, therefore, defendant had no right to foreclose on the property.[2]

         On May 17, 2017, plaintiff filed a motion for summary judgment, arguing that the 1992 mortgage expired and was discharged by statute on June 3, 2007. The plaintiff further argued that, even if the 1997 amendment had properly extended the mortgage, it would have expired in 2011 and was therefore no longer enforceable under the statute. The defendant countered that, because the 1992 mortgage did not state a maturity date on its face, a thirty-five-year lien was created under the statute. Alternatively, defendant argued that the 1997 amendment was valid because it was recorded and, because the 1997 amendment failed to state a term or maturity date, the mortgage was valid for thirty-five years from the date of the 1997 amendment.

         The hearing justice found the 1997 amendment to be a "non-compliant mortgage extension, which is ineffective under the statute," and thus she considered the 1992 mortgage to be the operative document. The hearing justice further found, after giving the words of the statute their "plain and ordinary meaning," that defendant's mortgage had expired because the 1992 mortgage stated a term of ten years and, because the statute allows for exercise of the power of sale only five years following that term, the mortgage had expired in 2007. Accordingly, the hearing justice granted plaintiff's motion for summary judgment. The defendant filed a timely notice of appeal on October 24, 2017.

         II Standard of Review

         "This Court reviews a hearing justice's grant of a motion for summary judgment de novo." Pineda v. Chase Bank USA, N.A., 186 A.3d 1054, 1056 (R.I. 2018). "We will affirm a [trial] court's decision only if, after reviewing the admissible evidence in the light most favorable to the nonmoving party, we conclude that no genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law." Cancel v. City of Providence, 187 A.3d 347, 350 (R.I. 2018) (quoting Newstone Development, LLC v. East Pacific, LLC, 140 A.3d 100, 103 (R.I. 2016)). "Furthermore, the nonmoving party bears the burden of proving by competent evidence the existence of a disputed issue of material fact and cannot rest upon mere allegations or denials in the pleadings, mere conclusions or mere legal opinions." Id. (quoting Newstone Development, LLC, 140 A.3d at 103). "[S]ummary judgment should enter against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case * ...


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