MERS, the Mortgage Electronic Registration System, won another court battle last week.  On February 21 the New Hampshire Superior Court affirmed, in the case of Dow v Bank of New York Mellon Trust, that MERS had the authority to both hold and assign its interest in mortgages under New Hampshire law. 

Presiding Justice N. William Delker wrote in his decision that the language of the plaintiff's mortgage expressly named MERS as the mortgagee and gave it the authority to act as nominee of the lender.  This authority included the right to assign its interest in the mortgage to the Mellon Trust.  "The plaintiff expressly gave MERS and its assignees the authority to foreclose.  Moreover, the mortgage instrument put the plaintiff on notice that both the original lender and MERS could assign their interest without notice to the plaintiff."

Justice Delker further wrote, "There is a tremendous amount of case law throughout the country on the issues surrounding foreclosure actions when the promissory note is held by one entity and the mortgage is held by another entity - typically MERS.  The process of recording each new assignment of the mortgage in the registry of deeds in order to perfect the security interest in the real estate would become exceedingly expensive and cumbersome if each time the promissory note and the mortgage changed hands a new mortgagee would have to be listed in the title record."

Since January 24 MERS has won in similar cases in the U.S. Court for the Western District of Kentucky and the U.S. Court of Appeals for the 11th Judicial Circuit.    Other cases are pending including several brought by state's attorneys general.