November 2, 2011
Practice Group:
Mortgage Banking &
Consumer Financial
Products
When Trying Title Becomes Trying:
The Impact of Bevilacqua v. Rodriguez on
Massachusetts Foreclosure Law
By R. Bruce Allensworth, Andrew C. Glass, and Roger L. Smerage
The Massachusetts Supreme Judicial Court (“SJC”) has ruled that Massachusetts property owners may
lack standing to establish title to their property where there is a void foreclosure sale in the chain of
title. The Massachusetts “try title” statute permits a holder of “record title” in possession of property
to file a petition to force adverse claimants to defend their purported interest in the property.1 In
Bevilacqua v. Rodriguez,2 the SJC held that a third-party purchaser of foreclosed property did not hold
record title where no assignment of mortgage to the foreclosing entity had occurred at the time of
foreclosure. Absent such an assignment, the foreclosure sale was invalid, and the foreclosing entity
had nothing to convey to the third-party purchaser. Taking nothing from the foreclosing entity, the
third-party purchaser lacked standing to maintain a try title action against the original mortgagor.3
Nonetheless, the scope of the ruling is likely limited to Massachusetts and jurisdictions where a
mortgagee or its assigns must initiate foreclosure and where the party bringing the foreclosure action
did not obtain an assignment of the mortgage until after the commencement of the foreclosure process.
Moreover, because the Bevilacqua decision simply applies the law as already articulated by the SJC in
its January 2011 U.S. Bank, N.A. v. Ibanez4 opinion, its impact on current and ongoing foreclosure
practices appears limited. Massachusetts foreclosure attorneys are likely to have already altered their
assignment practices in light of Ibanez.
Background
The Bevilacqua decision flows from the SJC’s decision in Ibanez, which found that a foreclosing
party must be the valid assignee of the mortgage at the time notice of a foreclosure sale issues.5 In
Bevilacqua, the defendant-mortgagor granted a mortgage on the subject property to his lender’s
nominee. A trust subsequently acquired the loan, for which trust U.S. Bank, N.A. acted as trustee
(“U.S. Bank, as Trustee”). After the mortgagor defaulted on the loan, U.S. Bank, as Trustee
foreclosed on the property and purchased the property at the foreclosure sale. The lender’s nominee,
however, did not assign the mortgage to U.S. Bank, as Trustee until a month after the foreclosure sale.
Subsequently, U.S. Bank, as Trustee sold the property to Bevilacqua, granting him a quitclaim deed.6
Three years later, Bevilacqua brought a try title action in the Massachusetts Land Court in the attempt
to extinguish any claim the original mortgagor might assert with respect to the property. Specifically,
Bevilacqua alleged that there was a possible cloud on the title arising from the fact that U.S. Bank, as
Trustee had foreclosed on the property before it became the assignee of the mortgage.
Notwithstanding the alleged defect in foreclosure sale, Bevilacqua asserted several theories as to why
he held record title and thus, could maintain an action to compel the original mortgagor either to prove
his title or be barred from asserting a claim to the property in the future.7 Rejecting each of these
theories, the Land Court concluded that the plaintiff was not the holder of record title to the property
and, thus, lacked standing to maintain a try title action. As a result, the Land Court dismissed the
When Trying Title Becomes Trying: The Impact of Bevilacqua v.
Rodriguez on Massachusetts Foreclosure Law
petition, and the plaintiff appealed.8 Taking the appeal on direct review, the SJC affirmed the Land
Court’s ruling in principal part, but held that the dismissal should have been entered without prejudice.
The SJC’s Decision
On appeal, the SJC examined each of Bevilacqua’s assertions as to why he held record title to the
property and found each wanting.9 The plaintiff first argued that he held record title “because he is the
owner by virtue of a quitclaim deed granted to him by U.S. Bank[, as Trustee].”10 The SJC found that
merely recording a deed did not make the plaintiff the holder of record title. Rather, the court ruled
that the act of recording a deed is of no import where the chain of title was otherwise insufficient to
establish the plaintiff held an interest in the property.11 The court noted that the plaintiff himself had
alleged that the foreclosing entity “was not the assignee of the mortgage at the time that it purported to
foreclose on the property.”12 Under Ibanez, this admission meant “that the power of sale was not
complied with, that the purported sale was invalid, and that [plaintiff’s] grantor’s title was
defective.”13 Because the grantor had no valid interest in the property, the quitclaim deed the grantor
gave to the plaintiff conveyed no interest in the property. The plaintiff, therefore, could not, and did
not, become the holder of record title by merely recording a deed to the property.14
Next, Bevilacqua contended that he held record title by virtue of being an assignee of the mortgage.
Essentially, the plaintiff’s theory was that through his quitclaim deed, he received an assignment of
the mortgage from U.S. Bank, as Trustee.15 Under Massachusetts law, a mortgagee, or its assignee,
holds “legal title” to a property, while the mortgagor retains “equitable title.”16 The SJC found that
these interests are “complementary,” not adverse.17 The try title statute, however, only provides a
right of action to resolve adverse interests in property.18 Consequently, a party’s status as an assignee
of a mortgage does not provide the party with standing to bring a try title action against the mortgagor
of a property where (1) no valid foreclosure sale has occurred and thus, (2) the mortgage is still in
existence.19 Rather, a party’s status as an assignee of the mortgage presupposes that the mortgagor
continues to have a valid equitable interest or right of redemption in the mortgage. As the SJC put it,
under those circumstances, to try to seek a declaration that no one else has an interest in the title to the
property “would be oxymoronic.”20
The plaintiff’s final argument was that he held record title as “a bona fide purchaser for value and
without notice of any defect in the title.”21 The SJC paid no heed to this argument. The court held
that pursuant to Ibanez, (1) the flawed foreclosure transaction was void, and thus, (2) U.S. Bank, as
Trustee could not have sold, and the plaintiff could not have purchased, the property.22 In any event,
the court found the plaintiff’s own pleadings established that he took his deed with notice of the flaws
in the chain of title.23
Notwithstanding its rejection of the plaintiff’s assertion that he held record title, the SJC reversed the
Land Court’s entry of dismissal with prejudice. The court reasoned that because the dismissal rested
on jurisdictional grounds, it was not a decision on the merits to which preclusive effect attached
“beyond the matter actually decided.”24
Potential Impact
Although the Bevilacqua decision may raise questions about the validity of title to properties where
the chain of title includes a foreclosure sale, this is neither surprising nor remarkable in light of
Ibanez. In Ibanez, the SJC ruled that under Massachusetts law, an entity seeking to foreclose by
power of sale must either be the mortgagee, its agent, or its assignee.25 This is because, according to
the SJC, Massachusetts common law does not recognize the mortgage-follows-the-note theory.26
2
When Trying Title Becomes Trying: The Impact of Bevilacqua v.
Rodriguez on Massachusetts Foreclosure Law
Under Massachusetts law, where a note holder is not the original mortgagee and no express
assignment of mortgage has occurred, (1) the note holder only has the equitable right to require such
an assignment,27 and (2) because foreclosure by power of sale is a right provided to the mortgagee –
that is, the holder of the legal title to the property,28 such an assignment must occur prior to the
initiation of the foreclosure process.29
The Bevilacqua decision does not expand on or add to the requirements for foreclosure by power of
sale under Mass. Gen. Laws ch. 244, § 14, as interpreted in Ibanez.30 Rather, the Bevilacqua court
merely found that the holding in Ibanez applies equally to a foreclosing entity or a subsequent grantee
of the foreclosing entity when the putative owner tries to establish its exclusive title to property
following a foreclosure sale. In addition, Bevilacqua hews to the principle that the SJC endorsed in
Ibanez, namely that when a mortgage loan is securitized, the securitization documents themselves may
establish that the foreclosing entity is the assignee of the mortgage.31
Nor did the SJC address a significant issue tangential to the Bevilacqua matter, namely whether a
foreclosure sale is valid when the assignee of a mortgage does not hold the note at the time of
foreclosure. The SJC stated that “[n]othing contained herein is intended to limit Bevilacqua’s right, if
he can show himself to be mortgagee of the property, to pursue foreclosure under the appropriate
statutes. The record does not disclose[, however,] if Bevilacqua presently holds the promissory note
secured by Rodriguez’s mortgage. [Thus, w]hether the holder of a mortgage may foreclose the equity
of redemption without also holding the note is a question that is not before us.”32 That question,
however, is the subject of another matter pending before the SJC, Eaton v. Federal National Mortgage
Association.33 The court heard oral argument in Eaton last month and a decision is likely to issue in
early 2012.
Nevertheless, Bevilacqua has the potential to impact third-party purchasers whose properties were the
subject of foreclosure proceedings that did not comply with Ibanez. As the court stated,
unsympathetically,
[t]here are limits to the protections provided to bona fide
purchasers, … and “[t]he purchaser of an apparently perfect
record title is not protected against all adverse claims.” Where
the bona fide purchaser is not protected against an adverse claim,
the purchaser “must rely upon the covenants of his deed” rather
than dispossession of the true owner – that is, there are situations
in which it is the purchaser rather than the original owner who
must seek recovery from a third person rather than being
awarded possession of the property itself.34
The Bevilacqua decision, however, does not preclude parties from attempting to cure defective
foreclosures. Once a note holder becomes the assignee of the mortgage, it has the ability under Mass.
Gen. Laws ch. 244, § 14, to reinitiate foreclosure proceedings against the mortgagor in default,
purchase the property at the foreclosure sale, and reconvey it to the third-party purchaser.35 The SJC’s
decision to convert the dismissal in Bevilacqua to a dismissal without prejudice appears to provide for
this outcome. Under such rectified circumstances, the plaintiff could bring a new try title action to
establish that the original mortgagor no longer has an interest in the property. Whether the plaintiff is
able to achieve such an outcome, and whether other third-party purchasers (either directly or through
their title insurers) who find themselves in similar circumstances are able to do so, depends on the
facts of their particular situation.
3
When Trying Title Becomes Trying: The Impact of Bevilacqua v.
Rodriguez on Massachusetts Foreclosure Law
Conclusion
As with its decision in Ibanez, the SJC’s decision in Bevilacqua relies on particular aspects of
Massachusetts statutory and common law, and, thus, its scope is likely limited to Massachusetts and
jurisdictions that require the mortgagee or its assigns to initiate foreclosure and where the party
bringing the foreclosure action did not obtain an assignment of the mortgage until after the
commencement of the foreclosure process. Moreover, the decision does not appear to impose any
new requirements on Massachusetts foreclosure practices beyond those articulated in the Ibanez
decision. Thus, while the decision certainly is not welcome news to the industry, its impact should not
be overstated.
Authors:
R. Bruce Allensworth
bruce.allensworth@klgates.com
+1. 617.261.3119
Andrew C. Glass
andrew.glass@klgates.com
+1. 617.261.3107
Roger L. Smerage
roger.smerage @klgates.com
+1. 617.951.9070

R. Bruce Allensworth and Andrew C. Glass are partners, and Roger L. Smerage is an associate, in the consumer
financial services and class action litigation defense practice areas of K&L Gates LLP’s Boston office.
1
Mass. Gen. Laws ch. 240, §§ 1-5. The statute provides, in pertinent part, that “[i]f the record title of land is clouded by an
adverse claim, or by the possibility thereof, a person in possession of such land claiming an estate of freehold therein …
may file a petition in the land court stating his interest, describing the land, the claims and the possible adverse claimants
so far as known to him, and praying that such claimants may be summoned to show cause why they should not bring an
action to try such claim.” Mass. Gen. Laws ch. 240, § 1.
2
No. SJC-10880, --- N.E.2d ----, 2011 WL 4908845 (Mass. Oct. 18, 2011).
3
Id. at *4-6.
4
941 N.E.2d 40 (Mass. 2011).
5
Id. at 51.
6
Bevilacqua, 2011 WL 4908845, at *2.
7
Id. (“[plaintiff] seeks an order that either compels [defendant] to bring an action to try his title or forever bars him from
enforcing his adverse claims to the property”); see id. at *4-10 (discussing three theories).
8
Id. at *1-2.
9
Id. at *3. To maintain a try title action, a plaintiff must establish both that he or she is the holder of record title and is “a
person in possession” of the subject property. The SJC found that the Bevilacqua petition sufficiently alleged the latter
requirement. Id.
10
Id. at *4.
11
Id. at *5 (“there is nothing magical in the act of recording an instrument with the registry that invests an otherwise
meaningless document with legal effect”).
4
When Trying Title Becomes Trying: The Impact of Bevilacqua v.
Rodriguez on Massachusetts Foreclosure Law
12
Id.
13
Id. at *6.
14
Id.
15
Id. at *6-7. The actual basis for the Bevilacqua plaintiff’s argument was that the foreclosure deed – from the foreclosing
entity to itself – acted to assign the mortgage to the plaintiff. The SJC rejected that assertion on the basis that the plaintiff
“was not a party to the foreclosure deed.” Id. at *7. Yet, the court “assume[d] without deciding” that the plaintiff might be
able “to establish a chain of assignments passing from his quitclaim deed” up through the assignment from the lender’s
nominee to U.S. Bank, as Trustee, and ultimately, “back to [the original mortgagor’s] deed of title” such “that there [may
be] a factual basis on which [the Bevilacqua plaintiff could] claim to be the assignee of the mortgage.” Id.
16
See id. at *7. Indeed, Massachusetts’s status as a “title theory” state distinguishes it from those states that apply the
“lien theory” of mortgages, in which the mortgagee simply holds a secured lien on the property rather than some form of
title to it.
17
Id. at *9.
18
Mass. Gen. Laws ch. 240, § 1; see Bevilacqua, 2011 WL 4908845, at *9 (“although their economic interests may
diverge, [plaintiff] cannot be heard to argue that [defendant’s] claim is adverse to his own”).
19
See Bevilacqua, 2011 WL 4908845, at *8-9 (“[t]o assert that he holds legal title as mortgagee, Bevilacqua must
necessarily accept that [the mortgagor] has … either equitable title … or an equity of redemption” (emphasis added)).
20
Id. (“[t]he legal title possessed by a mortgagee is not … a basis of standing that would be consistent with maintenance”
of an action to petition for try title).
21
Id. at *9.
22
Id.
23
Id. at *10.
24
Id. at *10-11 (“dismissal of this action for want of subject matter jurisdiction does not bar [plaintiff] from bringing other
actions regarding title to the property”).
25
See Ibanez, 941 N.E.2d at 51 (“the plaintiffs had the authority to exercise the power of sale contained in the …
mortgages only if they were the assignees of the mortgages at the time of the notice of sale and the subsequent
foreclosure sale”).
26
Id. at 53-54 (“the assignment of the note does not carry with it the assignment of the mortgage”).
27
Id.
28
See Mass. Gen. Laws ch. 244, § 14; see also Valerio v. U.S. Bank, N.A., 716 F. Supp. 2d 124, 128 (D. Mass. 2010)
(“[t]he Massachusetts statute governing foreclosure sales is addressed to mortgagees, not note holders”).
29
See Ibanez, 941 N.E.2d at 51, 54.
30
As the Ibanez court noted, in addition to foreclosure by power of sale, Massachusetts law permits mortgage holders to
foreclose by entry upon the property. 941 N.E.2d at 49 n.15. Foreclosure by entry requires the mortgagee to openly and
peaceably enter the property, record a memorandum of entry with the applicable registry of deeds, and maintain itself on
the property for at least three years. Mass. Gen. Laws ch. 244, §§ 1-2.
31
See Ibanez, 941 N.E.2d at 52-53. In particular, the SJC stated that “[w]here a pool of mortgages is assigned to a
securitized trust, the executed agreement that assigns the pool of mortgages, with a schedule of the pooled mortgage
loans that clearly and specifically identifies the mortgage at issue as among those assigned, may suffice to establish the
trustee as the mortgage holder” so long as there is “proof that the assignment was made by a party that itself held the
mortgage.” Id. at 53. The securitization documents, however, were not part of the appellate record in Bevilacqua.
32
Bevilacqua, 2011 WL 4908845, at *9 n.10.
33
No. SJC-11041 (Mass.).
34
Bevilacqua, 2011 WL 4908845, at *9 (internal citations omitted).
35
Alternatively, the holder of a securitized loan could establish that it became the assignee of the mortgage preforeclosure through the securitization process.
5
When Trying Title Becomes Trying: The Impact of Bevilacqua v.
Rodriguez on Massachusetts Foreclosure Law
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6
When Trying Title Becomes Trying: The Impact of Bevilacqua v.
Rodriguez on Massachusetts Foreclosure Law
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7