Niday v. GMAC Mortgage, LLC

For the purposes of the Oregon Deed Trust Act (ODTA), a beneficiary on a trust deed is the party that is entitled to repayment of the note. A party named as beneficiary, but lacking that entitlement, has no right to appoint a successor trustee after sale of the promissory note.

Niday obtained a loan from Greenpoint Mortgage Funding, Inc. A deed of trust was then executed naming Mortgage Electronic Recording System, Inc. (MERS) as beneficiary solely as nominee for lender and lender's successor. Greenpoint sold the promissory note to GMAC Mortgage, LLC. MERS subsequently appointed Executive Trust Services, Inc. (ETS) as successor to the original trustee. MERS and ETS sent Niday notice that the property was subject to nonjudicial foreclosure as a result of her failure to pay the note. Niday brought suit against ETS and MERS claiming that they had no right to foreclose on the property. The trial court granted summary judgment in favor of ETS and MERS and the Court of Appeals reversed. It held MERS was not a beneficiary for purposes of the ODTA and there was an issue of fact that remained regarding the validity of ETS's appointment as successor trustee. The Court disagreed with the Court of Appeals analysis as to whether a genuine issue of material fact existed with regard to whether the recording requirements had been satisfied. The Supreme Court held there was nothing in the record to show the identity of lender's successor in interest or that MERS had the authority to act for that successor. The trial court erred in granting summary judgment. The Court of Appeals was affirmed. Affirmed.