Beal Bank USA v. New Century Mortgage Corp.
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The Supreme Judicial Court affirmed the decision of the superior court denying Beal Bank USA's complaint to compel the assignment of a mortgage to Beal by the insolvent originating lender, New Century Mortgage Corporation, holding that the court did not err in denying the relief sought by Beal to compel assignment of the mortgage in this case.
On appeal, Beal argued that because it was the holder of the note secured by the mortgage, the court erred when it failed to apply the equitable trust doctrine to conclude that New Century held the mortgage in trust for Beal and that Beal was entitled to an assignment of the mortgage. The Supreme Judicial Court disagreed, holding (1) although the holder of the note may retain some equitable interest in the accompanying mortgage, any such interest, standing alone, does not equate to actual ownership of the mortgage, nor is the interest sufficient to establish a pre-foreclosure right to compel its assignment; and (2) Beal did not produce sufficient independent evidence of ownership of the mortgage to compel an assignment.
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