United States District Court, D. Oregon
OPINION AND ORDER
Michael J. McShane, United States District Judge
reasons set forth below, Defendants' Motion for Summary
Judgment [#24] is GRANTED and this action is DISMISSED with
prejudice. Defendant NWTS's Motion for Summary Judgment
[#25] (joining in U.S. Bank's Motion for Summary
Judgment) is also GRANTED for the same reasons.
& FACTUAL BACKGROUND
Connie McClure originally filed this action against
defendants U.S. Bank and Northwest Trustee Services, Inc.
("NWTS") in Deschutes County Circuit Court on
7/18/2016. (See Deschutes County Circuit Court case
No. 16-CV-22680). On 7/26/16, the defendants removed the case
to federal court pursuant to 28 U.S.C. §§
1332(a)(1) and 1441 because there is complete diversity of
citizenship between the plaintiff and the defendants, and the
amount in controversy, exclusive of interests and costs,
exceeds $75, 000.
9/13/16, defendant U.S. Bank filed the Motion for Summary
Judgment [#24] that is now before this Court. On the same
day, defendant NWTS filed their own Motion for Summary
Judgment [#25], joining in U.S. Bank's Motion for Summary
Judgment. Oral arguments were heard on 11/15/16 [#35].
claims against defendants U.S. Bank and NWTS are for
declaratory and injunctive relief for the alleged wrongful
foreclosure of her home located in Deschutes County, Oregon.
The plaintiff alleges multiple procedural errors by the
defendants during the foreclosure process and claims that the
defendants' ability to foreclose expired under the 6-year
statute of limitations found in ORS 12.080. [#1 and #26 at
pp.9-25]. The defendants claim that ORS 88.110 is the
controlling statute, which has a 10 year statute of
limitations and therefore allows the foreclosure. [#24 at pp.
following facts are undisputed: On November 29, 2006
Plaintiff executed and delivered a note in the amount of
$200, 000 to First Franklin, a division of National City
Bank, to purchase a home in Bend, Oregon. [#1-2 at p.2]. The
Note was endorsed from First Franklin to First Franklin
Financial Corporation, and then endorsed in blank by First
Franklin Financial Corporation. [#16-1]. The Note was secured
by a Trust Deed which was recorded in Deschutes County,
Oregon [#16-2], and then was subsequently assigned to the
Trust, with the assignment also recorded in Deschutes County.
[Id. and #10-1]. Plaintiff made payments on the Note
until February 2009. [#24 at p.4]. On 8/19/2014, SPS, on
behalf of the Trust, executed an Appointment of Successor
Trustee, naming NWTS the successor trustee under the Trust
Deed. [#16-5]. On 3/29/2016, NWTS (the trustee) recorded a
Notice of Default and Election to Sell [#28 at p.32], but
they have been enjoined from proceeding with the sale [#23].
court must grant summary judgment if there are no genuine
issues of material fact and the moving party is entitled to
judgment as a matter of law. Fed.R.Civ.P. 56(a). An issue of
fact is genuine "if the evidence is such that a
reasonably jury could return a verdict for the nonmoving
party." Villiarimo v. Aloha Island Air., Inc.,
281 F.3d 1054, 1061 (9th Cir. 2002) (quoting Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). The
court views the evidence in the light most favorable to the
non-moving party. Allen v. City of Los Angeles, 66
F.3d 1052, 1056 (9th Cir. 1995) (citing Jesinger v.
Nevada Federal Credit Union, 24 F.3d 1127, 1130 (9th
Cir. 1994)). On a motion for summary judgment, "the
moving party bears the initial burden to show the absence of
a material and triable issue of fact; the burden then moves
to the opposing party, who must present significant probative
evidence tending to support its claim or defense."
Richards v. Neilsen Freight Lines, 810 F.2d 898, 902
(9th Cir. 1987). If the moving party shows that there are no
genuine issues of material fact, the nonmoving party must go
beyond the pleadings and designate facts showing an issue for
trial. Celotex Corp. v. Catrett, 477 U.S. 317, 324
(1986); see Fed. R. Civ. P (56)(c). Where the
non-moving party bears the burden of an issue at trial and
the motion challenges that issue, the non-moving party must
set forth specific facts showing that there is a genuine
issue for trial. Fed.R.Civ.P. 56(e)(2); Crane v. Allen,
No. 3:09-cv-1303-HZ, 2012 WL 602432, at *2 (D. Or. Feb.
all inferences should be drawn in favor of the non-moving
party, the mere existence of some alleged factual
dispute will not defeat an otherwise properly supported
motion for summary judgment. Anderson, 477 U.S. at
247'-48. Rather, the non-moving party must proffer
evidence that could reasonably affect the outcome of the
suit. Miller v. Glenn Miller Prods., Inc., 454 F.3d
975, 988 (9th Cir. 2006). The substantive law determines
whether a disputed fact is material. Richards, 810
F.2d at 902.
initial matter, in the plaintiffs 1st and
2n claims for relief, she asserts that the
nonjudicial foreclosure sale of her home was invalid because
the foreclosure trustee was not properly appointed to conduct
the sale. As discussed on the record during oral arguments
[#35], the facts establish that the Trust's agent
properly appointed NWTS as the successor trustee pursuant to
a recorded Limited Power of Attorney granting NWTS trustee
authority [#24 at pp.5-6; #16-3], and the documents prove
that the Trustee holds the right to enforce both the Note and
Trust Deed. [#16-1 to 16-5].
as the Note was endorsed in blank and the Trust is in
possession of the Note, they are the holder of the Note with
standing to initiate and complete the challenged non-judicial
foreclosure. See ORS § 71.2010(2)(e)
("bearer" means "a person in possession of a
negotiable instrument"); ORS § 73.0205(2)
("When endorsed in blank, an instrument becomes payable
to bearer and may be negotiated by transfer of possession
alone..."); ORS § 73.0301.
holder of the Note endorsed in blank, the Trust is also
entitled to enforce the Trust Deed. West v. White,307 Or. 296, 300, 768 P.2d 383 (1988) ("Assignment of a
note carries with it a security interest because the security
is merely an incident to the debt."). It is well settled
under Oregon law that a party who holds a note endorsed in
blank has the right to enforce the note and that the
successor to the original lender becomes the beneficiary of
the trust deed. Nationstar Mortgage, LLC v. Peper,278 Or.App. 594, 596, 598, P.3d (2016). An Assignment of
Trust Deed was also properly recorded. [#16-5]. Finally,
Select Portfolio Servicing, Inc. ("SPS"), which
executed the 2014 Appointment, was acting on behalf of the
Trust pursuant to a recorded Limited Power ...