Senior Judge Rules “Plaintiff cannot enforce a nonexistent obligation”
Reston, Virginia – January 16, 2012 – (RealEstateRama) — MERSCORP Holdings, Inc. today announced that U.S. District Senior Judge Ortrie D. Smith of the U.S. District Court for the Western District of Missouri, Western Division, ruled yesterday in favor of Mortgage Electronic Registration Systems, Inc. (MERS) and other defendants, dismissing a recording fee suit filed by Jackson County, Missouri.
In Jackson County v. MERSCORP, Judge Smith dismissed a five-count, putative class action suit filed on behalf of Jackson County and all other similarly situated counties in the State of Missouri, ruling that “Plaintiff cannot recover for the failure to record.” The suit – alleging unjust enrichment, civil conspiracy and prima facie tort – sought declaratory and injunctive relief under the primary allegation that MERS and its members failed to record deeds of trust assignments and therefore failed to pay the applicable county recording fees.
Judge Smith’s January 14, 2013, Order ruled that Jackson County failed to state a claim for unjust enrichment because the claim is premised on the incorrect notion that MERS acted improperly by not recording assignments after initial deeds of trust were recorded.
“Here, Plaintiff has failed to state a claim for unjust enrichment…there is no duty to record assignments under Missouri law,” Judge Smith wrote. While a benefit of priority is conferred by the Missouri recording statutes, the Judge noted that “… Plaintiff does not allege that Defendants fail to pay the applicable recording fees for the initial deeds of trust that were recorded.”
“We are pleased with Judge Smith’s ruling,” MERSCORP’s Director for Corporate Communications Jason Lobo said. “Missouri now joins four other states in which judges have granted our motions to dismiss lawsuits similar to this one.”
For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit www.mersinc.org.
MERSCORP Holdings, Inc. is a privately held corporation that owns and manages the MERS® System and all other MERS® products. It is a member-based organization made up of thousands of lenders, servicers, sub-servicers, investors and government institutions. Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note. The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.