Federal National Mortgage Association v. Goodrich

Under the Oregon Trust Deeds Act, the Mortgage Electronic Recording System (MERS) is neither a lender nor a successor to a lender, and therefore cannot be a proper beneficiary. A non-judicial foreclosure by an assignee of MERS is invalid where there was no recording of the assignment in the county in which the property is located.

Federal National Mortgage Association (Plaintiff) sought review of the trial court’s decision in Plaintiff’s action for forcible entry and wrongful detainer that Plaintiff had no claim for rightful possession of property sought to be foreclosed on by Plaintiff in a non-judicial foreclosure. Defendants purchased their property through a trust deed, which identified Mortgage Electronic Recording System (MERS) as the “beneficiary” and “nominee” of the trust deed. After a series of assignments, Plaintiff was assigned the trust deed, and Defendant defaulted on the loan it secured. Subsequently, Plaintiff underwent a non-judicial foreclosure against Defendant. During the pendency of this action, the Oregon Supreme Court decided Brandrup v. ReconTrust, Co., 353 Or 668 (2013) and Niday v. GMAC Mortgage, LLC, 353 Or 648 (2013) which together determined that MERS is neither a lender nor a successor to a lender, and is therefore not a proper beneficiary under the Oregon Trust Deeds Act. Plaintiff sought to distinguish this case from Brandrup and Niday by arguing that MERS was merely an agent of the beneficiary—however, the Court found no evidence in the record of an agency relationship between MERS and the original beneficiary. Consequently, the Court found no evidence that Plaintiff’s claim for possession was valid. Affirmed.