UTA has agreed to join the amicus brief effort by the Tennessee Bankers Association and the Tennessee Mortgage Bankers Association. Details of the UTA’s involvement in the briefing are still being finalized, but there will be no cost to the organization to participate.
The case – Wilmington Trust, N.A. as Trustee for Trust MFRA 2014-2, et al v. Terry Case – involves whether a court can imply a requirement for written notice for sale postponements of less than 30 days, where it’s not expressly required by the state’s nonjudicial foreclosure statutes or the underlying loan documents. The Tennessee Court of Appeals implied such a requirement, and by reversed the trial court’s judgment, effectively requiring rescission of the nonjudicial foreclosure sale. The Court held that the defendant lender and trustee did not strictly comply with the Deed of Trust’s notice requirements because the borrower was not sent a written notice of the postponement and rescheduled sale. The borrower did not have to show prejudice as a result of the alleged lack of notice.
If the Court of Appeals decision stands, Tennessee will become one of just five nonjudicial foreclosure states to require foreclosure sale rescission even if the borrower did not suffer – or even allege – any resulting harm or prejudice the alleged defect in the foreclosure sale.