No Irregularity in Foreclosure Proceeding, No Relief

In Acoff v US Bank NA, an unpublished Michigan Court of Appeals opinion, the mortgagors challenged the foreclosure of their home.  The bank filed a motion for summary disposition under MCR 2.116(C)(8) on the basis that their complaint failed to state a claim on which relief could be granted.  The trial court granted the motion and on appeal, the decision was affirmed.

A mortgagor seeking to set aside a foreclosure sale must plead and prove (1) fraud or irregularity in the foreclosure proceedings, (2) prejudice to the mortgagor, and (3) some causal connection between the fraud or irregularity and the prejudice. 

The mortgagors’ complaint alleged that the property was not posted with the foreclosure notice as required by statute; however, their complaint did not allege either prejudice or a causal connection.  

In an interesting aside, the court noted that the mortgagors waited until after the redemption period to expire which, under Bryan v JPMorgan Chase Bank, meant they lacked standing to challenge the foreclosure.  The court noted that, although Bryan was binding precedent, at least one federal court opinion held that it had jurisdiction to hear a post-redemption claim notwithstanding Bryan.  However, because the lower court did not reach the issue, the appellate court did not have to address it, either.

© Steve Sowell 2017