Federal National Mortgage Association v. Jeffrey D. Robinson, John Doe

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2012).

STATE OF MINNESOTA
IN COURT OF APPEALS
A14-0023

Federal National Mortgage Association,
Respondent,

vs.

Jeffrey D. Robinson, et al.,
Appellants,

John Doe, et al.,
Defendants.

Filed August 4, 2014
Affirmed
Halbrooks, Judge

Hennepin County District Court
File No. 27-CV-HC-11-7782

Gerald G. Workinger, Jr., Usset, Weingarden & Liebo, PLLP, Minneapolis, Minnesota
(for respondent)

William Bernard Butler, Butler Liberty Law, LLC, Minneapolis, Minnesota (for
appellants)

Considered and decided by Smith, Presiding Judge; Halbrooks, Judge; and

Hudson, Judge.

UNPUBLISHED OPINION

HALBROOKS, Judge

Appellants challenge an eviction judgment arising from a mortgage foreclosure,

arguing that (1) respondent lacks standing to proceed in this action and (2) fact questions
about the foreclosure procedure and ownership of the property make summary judgment

inappropriate. We affirm.

FACTS

In August 2002, appellants Jeffrey Robinson and Debra Robinson purchased a

home located in Plymouth, executing a promissory note to Washington Mutual Bank,

F.A. (WAMU) and a mortgage to Mortgage Electronic Registration Systems, Inc.

(MERS). The mortgage was later assigned to JP Morgan Chase Bank National

Association (Chase). In 2011, the Robinsons fell behind on their mortgage payments and

defaulted on their promissory note. Chase began foreclosure proceedings. The property

was foreclosed by advertisement, and Chase purchased the property at the foreclosure

sale for $226,535.18. Chase obtained the certificate of sale, also known as the sheriff’s

certificate, and promptly recorded it with the Hennepin County recorder. Under Minn.

Stat. § 580.07, subd. 2 (2012), the Robinsons had a five-week period to redeem the

property. They failed to redeem, but still remained in possession of the property.

In December 2011, Chase brought an eviction action to recover possession of the

foreclosed property. About that same time, the Robinsons, along with others who had

defaulted on their mortgages, brought quiet-title claims against Chase in federal court.

See Jerde v. JPMorgan Chase Bank, N.A., No. 11-2666, 2012 WL 206271, at *1

(D. Minn. Jan. 24, 2012), aff’d, 502 F. App’x 616 (8th Cir. 2013). In federal court, the

plaintiffs alleged that Chase had no right to foreclose on their mortgages because it did

not hold the original notes for their mortgages. Id. While their federal action was

pending, the Hennepin County district court stayed Chase’s eviction action against the

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Robinsons. In January 2012, the Robinsons’ federal action was dismissed with prejudice

under Fed. R. Civ. P. 12(b)(6). Id. at *2-3. The federal court determined that it was

“irrelevant” whether Chase held the original promissory notes for plaintiffs’ properties;

Chase held the current mortgage instruments, which entitled it to foreclose on the

properties. Id. at *3. The Eighth Circuit Court of Appeals affirmed this determination.

Jerde, 502 F. App’x 616 (8th Cir. Mar. 14, 2013).

Months after the Robinsons’ federal action was dismissed, Chase quitclaimed its

interest in the foreclosed property to respondent Federal National Mortgage Association

(Fannie Mae). In June 2013, Fannie Mae recorded the quitclaim deed with the Hennepin

County recorder. Then in July 2013, the Robinsons commenced another quiet-title action

in federal court, this time against Fannie Mae. See Robinson v. Fed. Nat’l Mortg. Assoc.,

No. 13-1868, 2014 WL 258644, at *1 (D. Minn. Dec. 27, 2013). In that action, the

Robinsons alleged that there was an unrecorded assignment of their mortgage to Fannie

Mae prior to foreclosure, which invalidated Chase’s, and therefore Fannie Mae’s, title to

the property. Id. at *7. That action was also dismissed with prejudice under Fed. R. Civ.

P. 12(b)(6). Id. at *1. The federal court determined that the Robinsons’ allegations were

“wholly unsupported statements” and that “the documents referenced in and attached to

the [c]omplaint show an unbroken chain of title from MERS to WAMU and from

WAMU to Chase (pre-foreclosure) and from Chase to Fannie Mae (post-foreclosure).”

Id. at *7-8.

In September 2013, Chase moved the district court to substitute Fannie Mae as the

party in interest in this eviction action, to lift the stay, and to grant summary judgment in

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favor of Fannie Mae, evicting the Robinsons from the property. The district court

determined that “[a]s successor title holder, Fannie Mae is the party entitled to assert its

possession interests in the property acquired by quit claim deed from Chase.” The

district court granted summary judgment in favor of Fannie Mae, and the Robinsons were

ordered to vacate the property. This appeal follows.

DECISION

I. Fannie Mae has standing to proceed in the eviction action.

The Robinsons argue that Fannie Mae lacks standing to proceed in this eviction

action. Whether a party has standing to proceed in an action is a question of law, which

we review de novo. Builders Ass’n of Minn. v. City of St. Paul, 819 N.W.2d 172, 176

(Minn. App. 2012). “Standing is a legal requirement that a party have a sufficient stake

in a justiciable controversy to seek relief from a court.” Enright v. Lehmann, 735 N.W.2d

326, 329 (Minn. 2007). A party may acquire standing by (1) suffering an injury-in-fact

or (2) being the beneficiary of a legislative act that grants standing. Id. We have held

that “the question of standing . . . may be raised at anytime.” In re Horton, 668 N.W.2d

208, 212 (Minn. App. 2003). We therefore address the issue now.

The Robinsons argue that due to irregularities that occurred at the foreclosure sale,

Chase’s title in the foreclosed property, and therefore Chase’s conveyance of that title to

Fannie Mae, is invalid. They contend that because Fannie Mae does not have valid title

to the property, it has not suffered an injury-in-fact. We disagree.

“An injury-in-fact is a concrete and particularized invasion of a legally protected

interest.” Lorix v. Crompton Corp., 736 N.W.2d 619, 624 (Minn. 2007). It is undisputed

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that Chase bought the foreclosed property at the foreclosure sale and recorded the

sheriff’s certificate of sale. When a sheriff’s certificate is recorded, “upon expiration of

the time for redemption, the certificate shall operate as a conveyance to the purchaser . . .

of all the right, title, and interests” in the foreclosed property. Minn. Stat. § 580.12

(2012). When the Robinsons failed to redeem the property within the statutorily

permitted time frame, Chase possessed valid title to the property. See id.; see also

Harbal v. Fed. Land Bank of St. Paul, 449 N.W.2d 442, 447 (Minn. App. 1989)

(concluding that the holder of the sheriff’s certificate acquires a type of vested ownership

interest in the property that is subject only to “the limited redemption rights of the

foreclosed owner”), review denied (Minn. Feb. 21, 1990). Chase then conveyed its

interest in the foreclosed property by quitclaim deed to Fannie Mae. This deed was

promptly recorded with the Hennepin County recorder. At that time, Fannie Mae became

the owner of the property. See Minn. Stat. § 507.06 (2012) (stating that “[a] deed of

quitclaim and release shall be sufficient to pass all the estate which the grantor could

convey by a deed of bargain and sale”).

As the owner of the property, Fannie Mae had a right to possess the property.

When the Robinsons did not allow Fannie Mae to take possession, they invaded Fannie

Mae’s legally protected interest in the property. See Minn. Stat. § 580.12; see also Lorix,

736 N.W.2d at 624. Therefore, Fannie Mae has suffered an injury-in-fact giving it

standing to proceed in the eviction action against the Robinsons.

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II. Fannie Mae is entitled to summary judgment.

The Robinsons argue that genuine issues of fact exist, which precludes the grant of

summary judgment for Fannie Mae. Summary judgment is proper “if the pleadings,

depositions, answers to interrogatories, and admissions on file, together with the

affidavits . . . show that there is no genuine issue as to any material fact and that either

party is entitled to a judgment as a matter of law.” Minn. R. Civ. P. 56.03. On appeal

from summary judgment, we review the evidence de novo, in a light most favorable to

the nonmoving party. Valspar Refinish, Inc. v. Gaylord’s, Inc., 764 N.W.2d 359, 364

(Minn. 2009).

An eviction action is a “summary court proceeding to remove a tenant or occupant

from or otherwise recover possession of real property by the process of law.” Minn. Stat.

§ 504B.001, subd. 4 (2012). To prevail in an eviction claim involving a mortgage

foreclosure, a plaintiff must prove that (1) a foreclosure of the mortgage on the property

occurred, (2) the time for redemption expired, (3) the defendant is holding over the

property, and (4) the plaintiff is entitled to possession of the property. See Minn. Stat.

§ 504B.285, subd. 1(1)(ii) (2012).

The record establishes that the Robinsons defaulted on their mortgage and that

their property was foreclosed by advertisement. It is undisputed that Chase purchased the

property at the foreclosure sale, obtaining an executed sheriff’s certificate that was later

recorded. The sheriff’s certificate is prima facie evidence that all requirements of law

relating to the sale have been met and that the purchaser holds title in fee after the time

for redemption has passed. Minn. Stat. § 580.19 (2012). The Robinsons do not dispute

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that the five-week redemption period expired without redemption. Nor do they dispute

that they remain in possession of the property. And the record contains a recorded

quitclaim deed indicating that Fannie Mae is the successor in interest to Chase and holder

in fee of the property. Fannie Mae has therefore proven that it is entitled to possession of

the property. We conclude that the four requirements to succeed in the eviction action

have been satisfied.

Yet the Robinsons argue that genuine issues of material fact remain relating to the

validity of the foreclosure, resulting in further fact questions as to whether Fannie Mae

has any right, title, or interest in the property. By challenging the foreclosure process and

validity of Fannie Mae’s title, the Robinsons have improperly expanded the scope of this

eviction proceeding. The scope of an eviction proceeding is narrow. AMRESCO

Residential Mortg. Corp. v. Stange, 631 N.W.2d 444, 445 (Minn. App. 2001). An

eviction action “merely determines the right to present possession and does not adjudicate

the ultimate legal or equitable rights of ownership possessed by the parties.” Dahlberg v.

Young, 231 Minn. 60, 68, 42 N.W.2d 570, 576 (1950). We have only allowed

counterclaims in an eviction action when “the eviction action presents the only forum for

litigating these claims.” Fraser v. Fraser, 642 N.W.2d 34, 41 (Minn. App. 2002). That

exception does not apply here. The Robinsons have twice raised quiet-title claims in

federal court. In both instances, they attacked the validity of the foreclosure procedure

and were unsuccessful. This eviction action cannot serve as the third forum for the

Robinsons to attack the validity of the foreclosure.

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 Because the Robinsons’ defenses to the eviction action are based on challenges to

the underlying foreclosure, which is outside the scope of an eviction proceeding, and

because the record shows that no genuine issues of material fact exist, we conclude that

the district court properly granted summary judgment. Fannie Mae is entitled to an

eviction judgment as a matter of law.

Affirmed.

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