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Nims v. Bank of New York Mellon Appeals Court Ruling

On March 03, 2020, the Massachusetts Appeals Court issued their Opinion in Nims v. Bank of New York Mellon, Ca. No. 2019-P-0179.

see Our previous blog entry on this case here

The Panel ruled against our argument, while at the same time acknowledging

"Although we recognize that the Supreme Judicial Court, in Fitchburg Capital, 471 Mass. at 254, stated in dicta that "a mortgage does not mature distinctly from the debts or obligations that it secures," and that a mortgage "does not generally have a binding effect that survives its underlying obligation," that case did not involve the acceleration of a note; nor did it involve shortening the maturity date of the mortgage as the plaintiffs seek here."

However, that was precisely what this case was about.

The Panel went on to find:

"A mortgage continues to be enforceable in an in rem proceeding against the security, separate from an in personam action against the debtor on the note. Thus, foreclosure on the mortgage is an alternate remedy to collection on the note. See Pearson v. Mulloney, 289 Mass. 508, 515 (1935); Jeffrey v. Rosenfeld, 179 Mass. 506, 509-510 (1901).."

The Obsolete Mortgage Statute (G.L. c. 260 Sec. 33) is that in rem proceeding which had a five (5) year repose period. Fitchberg was clear that the term "maturity date" references the date when the Debt falls due. It is indisputable upon the acceleration of a Note the entire outstanding balance becomes immediately due and payable, thus the maturity date is advances, see Delebreau v. Bayview Loan Servicing, LLC, 680 F.3d 412 (4th Cir. 2012),

It cannot be disputed that more than five (5) years elapsed since the acceleration of the Nims Note. This is precisely the reason the legislature amended G.L. c. 260, Sec. 33, which was to remove stagnant encumbrances upon title. As the 4th Circuit stated in Delebreau, it would be absurd to leave a mortgage recorded upon the title o a mortgagor for the better part of 30 years, where the Note was called due now.

We have filed a Petition for Further Appellate Review, and will carry this argument to the Massachusetts Supreme Judicial Court