On February 9, 2016, the Supreme Judicial Court heard oral argument for Bank of America, N.A. v. Debora A. Casey (In re Pereira), 791 F.3d 180 (1st Cir. 2015). The United States Court of Appeals for the First Circuit certified the following questions to the Massachusetts Supreme Judicial Court:
- May an affidavit executed and recorded pursuant to G.L. c 193, § 5B, attesting to the proper acknowledgment of a recorded mortgage containing a Certificate of Acknowledgment that omits the name of the mortgagor, correct what the parties say is a material defect in the Certificate of Acknowledgment of that mortgage?
- May an affidavit executed and recorded pursuant to G.L. c 183 § 5B, attesting to the proper acknowledgment of a recorded mortgage containing a Certificate of Acknowledgment that omits the name of the mortgagor, provide constructive notice of the existence of the mortgage to a bona fide purchaser, either independently or in combination with the mortgage?
It was the trustee’s position that the attorney’s affidavit could not cure such a defect because a defective mortgage cannot be legally recorded in the first place and, therefore, it cannot provide constructive notice in the registry of deeds of the encumbrance on the property. It was the bank’s position that an attorney’s affidavit can cure both substantive and technical defects in the mortgage, and, at the very least, the affidavit provides constructive notice of the mortgage good against a bona fide purchaser for value.
The Supreme Judicial Court affirmed the district court judge’s decision in Bank of America, N.A. v. Debora A. Case (In Pereira), 517 B.R. 1 (D. Mass. 2014), holding that the affidavit executed pursuant to G.L. c 183, § 5B was sufficient to cure the material defect in the acknowledgment, thereby making the mortgage properly recorded. As the attorney’s affidavit supplied the missing information, confirmed that all the steps necessary to acknowledge were properly taken, attested the omission of the mortgagers’ names was inadvertent, and referenced the book and page number of the previous recorded mortgage, the Court held that the affidavit cured the defect in the acknowledgment. The Court further explained that nothing in the language of G.L. c. 183, § 24 states or implies that the statute defines the exclusive permissible method of curing any and all defects that may exist in an acknowledgment. While acknowledging that the omission of the name of the mortgagor in an acknowledgment does indeed constitute a material defect, and that defect should operate to preclude the legal recording of the mortgage, the Court determined that a properly executed and recorded attorney’s affidavit filed and recorded operates to cure the original defect in the acknowledgment. The curing of the defect in the acknowledgment also cures the defect in the original recording of the mortgage, and the mortgage thereafter is properly considered within the mortgage property’s chain of title.
Furthermore, the Supreme Judicial Court held that the affidavit together with the mortgage provided legally adequate constructive notice to a bona fide purchaser. Under G.L. c. 183, § 4, constructive notice arises by operation of law when a mortgage is properly recorded. Because the prior recording of the mortgage had been remedied by the attorney’s affidavit, and thus deemed proper, the affidavit together with the mortgage provided legally adequate constructive notice to the bona fide purchaser.