TD Bank v. Cormier

• Court: Superior Court of Maine
• Decided: October 2, 2018
• Docket: AROre-16-34
• Status: Unpublished

Opinion

STATE OF MAINE SUPERIOR COURT AROOSTOOK, SS Cl VIL ACTION DOCKET NO. CARSC-RE-16-34

TD BANK, N.A., f/k/a First Massachusetts ) Bank, N.A., ) ) ORDER AND JUDGMENT OF Plaintifl: ) F'ORECLOSURE AND SALE V. ) ) TERRY CORMIER and JODINA ) Title of Real Estate is Involved CORMIER, ) ) Defendants. )

Title 83 Pine Street, Presque Isle, Maine 04769, is Involved Mortgage recorded in the South Aroostook County Registry of Deeds at Bk. 3550, Pg. 118

Following a trial on this matter on July 6, 2018, at which Defendants, Terry Cormier and

Jodina Cormier (together, "Defendants") appeared with counsel, and after review of the

pleadings, Affidavits, and admitted evidence at trial, the Court finds pursuant to M.R. Civ. P.

54(b) and case law as follows:

1. That the record indicates the following parties and counsel of record:

PARTY COUNSEL

Plaintiff: TD Dank, N.A. Stephanie A. Williams, Esq. One Portland Square Duane Morris, LLP Portland, ME 04101 Two Monument Square, Suite 505 Put1land, ME 0410 l

Defendants: Terry Connier Eugene J. McLaughlin, Esq. 83 Pine Street McLaughlin Law Office Presque Isle, ME 04769 P.O. Box 1631 Presque Isle, ME 04769

Jodina Cormier Eugene J. McLaughlin, Esq. 83 Pinc Street McLaughlin Law Oflicc Presque Isle, ME 04769 P.O. Box 1631 Presque Isle, ME 04769 TD Bank, N.A. v. Terry Cor_mie~, eJ fil.,_ Docket No. CARSC-RE-16-34

2. Thal all parties received notice of the proceedings in this action and that the notice

was given in accordance with the applicable provisions of the Maine Rules of Civil Procedure;

3. That venue is properly laid in this Court;

4. That the Defendants appeared in this action, mediation occurred and did not

resolve the case;

5. That Plaintiff is entitled to judgment as a matter of law;

6. That Defendants are in default under the terms of a certain Note, dated August 22,

2001, in the original principal amount of $57,000.00 (the "Note"), and the Defendants received

proper notice of said default pursuant to 14 M.R.S. § 6111;

7. That Plaintiff holds a Mortgage on real estate located 83 Pine Street, Presque Isle,

Maine, 04769, to secure the Note, which Mortgage is recorded in the South Aroostook County

Registry of Deeds in Book 3550, Page 118 (the "Mortgage"), the legal description of the

mortgaged property contained in said Mortgage is incorporated by reference;

8. That unless otherwise noted, as of July 6, 2018, the following amounts are owed

to the Plaintiff under the tenns of the Note and Mortgage:

a. principal balance: $47,201.33 b. accrued interest: $11,463.05 c. late charges (through January 24, 2016): $163.70 d. appraisal fees: $856.00 e. inspection fees: $449.32 f. escrow deficit: $10,084.90 g. expense advances: $505 .00 h. attorneys' fees and costs (through January 31, 2017):$10,656.04

SUBTOTAL: $81,379.34

i. additional reasonable attorneys' fees and expenses incurred by Plaintiff in preparing for trial; drafting a letter regarding the period of redemption; obtaining and recording a Clerk's Certification regarding appeal; obtaining and enforcing a Writ of Possession; preparing and conducting the foreclosure sale; filing and supporting a Report of Sale; in obtaining relief from stay and/or any other bankruptt.:y relief in any subsequent

2 TD Bank, N.A. v. Terry Connl~fs et al. Docket No. CARSC-RE-16-34

proceeding in U.S. Bankruptcy Court; and in pursuing and collection of any deficiency judgment to the extent it is not discharged in bankruptcy;

j. additional interest accruing on said principal from and including July 7, 2018 at the rate of $9.3756 per day, which is 7.250% per annum; and

k. any amounts advanced by Plaintiff to protect its mortgage security.

9. The order or priority of the parties who have appeared in this action (and have not

been defaulted), based on the order of recording, is as follows:

First: Plaintiff-$81,379.34 plus accrued interest at the Note rate of $9.3756 per day from

and including July 7, 2018, to the date of entry of judgment, plu.q interest after judgment at the

7.76% (the appropriate rate pursuant to 14 M.R.S. § 1602-C because the Note rate is less than

7.76%, the weekly average one-year United States Treasury hill rate as published by the Board of

Governors of the Federal Reserve System for the last full week of20I 7 plus 6%); and

Second: Defendants- any excess proceeds from sale, pursuant to 14 M.R.S. § 6324.

I 0. That Plaintiff's claim for attorneys' fees is integral to the relief sought, within the

meaning of M.R. Civ. P. 54(b)(2);

11. That there is no just reason for delay in the entry of final judgment for Plaintiff on

all claims, except for the claim for attorneys' fees incurred by Plaintiff after January 31, 2017,

for the following reasons:

a. If judgment is granted but not entered as final, the time periods set forth in

14 M.R.S. §§ 6322 and 6323 will commence even though the judgment is subject to later

revision and Plaintiff and any bidders at the foreclosure sale would be exposed to some risk in

proceeding to close a sale ifjudgment is not final and remains subject to revision; and

3 TD Bank. N.A. v. Teny Cormier. ct al. Docket No. CARSC-RE-16-34

b. Any dispute regarding attorneys' fees incurred by Plaintiff after January

31, 2017 may be resolved by Defendants filing a motion contesting Plaintiff's Report of Public

Sale as provided in 14 M.R.S. § 6324.

WHEREFORE, it is hereby ORDERED, ADJUDGED, and DECREED:

(a) That if Defendants, its heirs or assigns, do not pay Plaintiff the amounts adjudged

to he due to Plaintiff in Paragraph 8 above within ninety (90) days from the date of entry of this

Order, Plaintiff (through its agents or attorneys) shall, unless it elects to allow the Defendants to

cure and reinstate, proceeds with a sale of the real estate described in the Mortgage recorded in

the South Aroostook County Registry of Deeds in Book 3550, Page 118, pursuant to 14 M.R.S.

§§ 6321-6324, free and clear of all liens except liens senior to Plaintiff's Mortgage, and shall pay

the proceeds of the sale, after satisfying expenses of sale, in the priority order and amounts set

forth in Paragraph 9 above;

(h) That the Clerk is hereby directed to enter this Order and Judgment of Foreclosure

and Sale as a final judgment pursuant to M.R. Civ. R. 54(b)(l) except as to attorneys' fees

incurred after January 31, 2017;

(c) That if Defendants fails to redeem by paying the amounts adjudged to be due in

Paragraph 8 on or before ninety (90) days from the entry of this Order ( or cure and reinstate

within such additional time as Plaintiff in its sole discretion allows), or if Defendants abandons

the mortgaged property, Plaintiff shall then be entitled, at its option, without further hearing to

take exclusive possession of the real estate described in Plaintiff's Mortgage, and a Writ of

Possession shall then issue upon Plainti~ s request;

(d) That an execution shall issue against Defendants for the deficiency amount at

Plaintiffs request;

4 TD Bank, N..A. v, _Terry Com1ier, et al. Docket No. CARSC-R.E-16-34

(e) That Plaintiff shall specify attorneys' fees incurred after January 31, 2017 in its

Report of Public Sale, which shall then constitute a timely application for an award of additional

attorneys' fees, notwithstanding the requirements of M.R. Civ. P. 54(b)(3) to file such an

application within sixty (60) days after judgment; Defendant may contest the Report of Public

Sale and request for additional attorneys' fees by filing a motion pursuant to 14 M.R.S. § 6324;

(f) That once the applicable appeal period has expired, Plaintiff shall prepare and the

Clerk shall execute an appropriate certification either that no action was taken or than an appeal

was filed, and Plaintiff shall then record the said certification and a copy of this Judgment in the

Regislry of Deeds for Southern Aroostook County and pay the recording fees, in compliance

with l 4 M.R.S. § 2401 (3), such fees and costs so incurred by Plaintiff will be added to and

become part of the Mortgage indebtedness secw-ed by the Mortgage;

(g) That the court's Detailed Findings, Decision and Order Regarding Plaintiff's

Complaint for Foreclosure are incorporated herein; and

(h) That the Clerk shall enter the following on the docket:

"Order and Judgment of Foreclosure and Sale entered for Plaintiff as a final judgment

except for attorneys' fees incmTed after January 3 l, 2017, with the court's Detailed Findings,

Decision and Order Regarding Plaintiffs Complaint for Foreclosure of even date incorporated

herein. Said Order is incorporated in the docket by reference. The entry is made in accordance

with M.R. Civ. P. 79(a) at the specific direction of the Court. -· ,,, Dated a / <:::::>c/,. ~ v // ~~ , 2018.

(

5 TD Bank. N.A. v. Tt::LTY. C.Prmier._~lJ!L Docket No. CARSC-RE-16-34

Date Order entered on the Court's Docket: - -

Appeal Certification: I certify that the appeal period expired on _ _ _ _, without the filing

of an appeal.

Attest:

Clerk, Aroostook Superior Court

6 STATE OF MAINE MAINE SUPERIOR COURT AROOSTOOK, SS. LOCATION: CARIBOU CIVIL ACTION DOCKET NO: CARSC-RE-16-34

TD BANK, N.A. f/k/a First Massachusetts Bank, Plaintiff DETAILED FINDINGS, DECISION AND ORDfi:R REGARDING PLAINTIFF'S COMPLAINT FOR FORECLOSURE

vs.

TERRY CORMIER and JODINA CORMIER Defendants

TITLE TO REAL ESTATE IS INVOLVED 83 Pine Street, Presque Isle, Maine Mortgage recorded at SOARD Bk. 3550, pg.118

On or about March 24, 2016 TD Bank (hereafter Bank) filed a civil complaint against Terry

Cormier and Jodina Cormier (hereafter Defendants) seeking foreclosure of mortgage pursuant to

14 M.R.S. §6322 regarding property at 83 Pine Street, Presque Isle, Maine. Defendants timely

filed an answer to the complaint. Mediation was held on November 18, 2016 but the matter was

unresolved. Trial on the matter was held July 6, 2018 At trial the Bank proffered William Baker as its witness qualified to testify about the business

records of the various entities involved. M.R.Evid.803(6); Benejicial Maine v. Carter, 2011 ME

77, Key Bank Nat'/ Ass 'n v. Estate ofQuint, 2017 ME 237. 1 At trial the Bank offered the

following exhibits which were admitted:

A. Copy of Promissory Note dated August 22, 2001 from Defendants to Lender, First

Massachusetts Bank, N.A.,

B. Copy of Moitgage dated August 22, 2001 from Defendants to First Massachusetts Bank N.A.

regarding prope11y at 83 Pine Street, Presque Isle, Maine and recorded at SDARD Bk. 3550,

p. 118;

C. Copy of Ce11ificate of Assistant Corporate Secretary of TD Bank, National Association, with

suppm1ing documents, certifying that First Massachusetts Bank, NA merged with and into

Peoples Heritage Bartl(, N.A. and that its name was subsequently changed to Banknorth,

National Association, then to TD Banknorth, National Association, and finally changed to

TD Bank, National Association2 ;

D. Trial Modification Letter from Bartl( to the Defendants dated July 16, 2014 and signed by

Defendants on July 23, 2014;

E. Loan Modification and Amendment Agreement effective October 1, 2014, signed by

Defendants November 21, 2014 and signed by Sherry Giles on behalf of the Bank on

1 Ilasccl on his experience and training with the bank, his direct knowledge of the Bank's

operations, record keeping and software systems, the Court finds Mr. Baker to be a qualified witness. 2 At trial the court inspected the original note, mortgage and certificate, and compared them to Exhibits A, I3 and C. The proposed exhibits were each found to be accurate copies of the originals. After inspection, the originals were retW'ned to Dank's counsel.

2 Dt:cembcr 10, 2014;

Fl .Short Payment Letter dated December 24, 2014;

F2. Short Payment Letter dated May 20, 2015;

G l. Payment History;

G2. Payment History Code Definitions;

H. Notice of Right to Cure Default Letter dated July 16, 2015 issued by TD Bank;

I. Notice of Right to Cure Default Letters to each Terry Cormier and Jodina Cormier dated

December 17, 2015 issued by DuaneMon-is, Bank's counsel;

J. Reinstatement Itemization and Verification through December 17, 2015;

and

K. Payoff Itemization through July 6, 2018.

Also admitted into evidence was the Affidavit of Counsel Stephanie Williams dated July 3, 2018

itemizing attorney fees.

In addition, at trial both Defendants testified and the following Defense Exhibits were admitted:

I. Loan payment receipts dated January 16, February 17, March 16, April 17, May 18, and

June 15, 2015 each in the amount of $410, except for the receipt dated January 16 which

was in the amount of $409.40;

2. Letter from Bank to Defendants dated April 28, 2015 in response to their CFPB

complaint;

3. Letter from Bank to Defendants dated May 14, 2015 in response to complaint;

4. Payment History; and

5. Letter from Defendants to State of Maine, Department of Professional and Financial

3 Regulation detailing their complaint with the Bank.

At the conclusion of the proceedings the evidence was closed and the Court set a briefing

schedule for parties' counsel to submit written arguments. The court has received and reviewed

written arguments from Plaintiff dated August 8, and September 20, 2018 and from the

Defendant dated September 12, 2018.

DISCUSSION

For a judgment of foreclosure to be granted, there are eight required elements:

• the existence of the mo1tgage, including the book and page number of the mortgage,

and an adequate description of the mortgaged premises, including the street address, if

any;

• properly presented proof of ownership of the mortgage note and [evidence of the

mortgage note and] the mortgage, including all assignments nnd endorsements of the note

and the mortgage;

• a breach of condition in the mortgage;

• the amount due on the mortgage note, including any reasonable attorney fees and cornt

costs;

• the order of priority and any amounts that may be due to other pa11ies in interest,

including m1y public utility easements;

4 • evidence of properly served notice of default m1cl mm1gagor's right to cure in

compliance with statutory requirements;

• after January l, 2010, proof of completed mediation ( or waiver or default of mediation),

when required, pursuant to the statewide foreclosure mediation program rules; and

• if the homeowner has not appeared in the proceeding, a statement, with a supporting

affidavit, of whether or not the defendant is in military service in occordance with the

Servicemembers Civil Relief Act.

Chase Hume Finance LLC v. Higgins, 2009 ME 136, ~11.

I .Ownership and Existence of Note and Mortgage

In this case, the Bank has properly presented proof of its actual possession and ownership of the

promissory note, and the existence of a mm1gage. (See Exhibits A,B and C; Bank ofAmerica,

NA. v. Green/eqf.' 2014 ME 89, ,[21). The Bank is in actual possession of the original promissory

note and mortgage to First Massachusetts Bank, N.A. And this is a note and mortgage that has

been retained in Bank's portfolio since its inception. Soon after the loan's inception, First

Mnsachusetts Bank, N.A. merged into Peoples Heritage Bank, N.A., and then lhc Bank had three

name changes, to what is now TDBank, National Association. (see Exhibit C).

Before addressing the remaining elements required for foreclosure, the court must make findings

rel alive to the Loan Modification effective October 1, 20 l4. The original note and mortgage

required Dcfondm1ts to make a monthly payment of $388.84 for principal and interest, plus an

additional monthly amount for taxes and insurance, otherwise known as "escrows". (See

5 Paragraph 3 of p. 5 of the mmtgage, Exhibit B). The court notes that the monthly amount for the

escrow payment is not specified or fixed as those amounts indeed fluctuate from year to year.

Prior to October 2014 Defendants were behind on the mortgage payments and over $4000 behind

on the escrows. (See Exhibit D and Defense Exhibit 5).Upon reviewing the payment history, the

Defendants started falling behind in their payments in November 2012. (See Exhibit G 1). After

becoming delinquent the principal balance of the Joan remained at $47811.36. In an effort to

rectify the delinquency the Bank and Defendants negotiated a loan modification. Most of

Defendants' discussions and correspondence regarding Joan modification were with Sherry Giles

who worked in the loan modification department of the Bank.

On July 16, 2014, the Bank offered Defendants a trial loan modification, which Defendants

accepted. (See Exhibit D). The te1111s of the trial modification required Defendants to pay three

consecutive monthly payments of $678.56 on August 1, September! and October 1, 2014, and

were also to pay the negative escrow balance of $4129.20. Id. Defendants made those three

payments plus an additional fourth payment of the same amount on November 14, 2014 for the

November 2014 payment. (See Exhibit GI). The court notes that the monthly amount of $678 is

consistent with the monthly payments being made for principal, interest and escrows prior to

getting behind. (See Exhibit G l ). ln its offer letter the Hank advised the Defendants that upon

timely completion of the trial period payments it would re;;-amurtize the loan balance $4 7811.36

at the same interest rate of 7.25% over 203 months. (Exhibit D).

The monthly payments in the trial period being timely being made, the Bank forwarded to

Defendants a permanent Loan Modification and Amendment Agreement, to be effective October

6 I. 2014. (Exhibit E). The new payment for principal and interest on the lmrn balance of

$47,811.36 at a rnk of 7 .25% was set at $409.40 per month, with the first payment due

November 1, 2014. (See Paragraph 2 of Exhibit E). Due to some delay in getting the document to

Defendants, the Defendants did not sign it until November 21, 2014 but the Defendants fourth

payment of $678.56 went to the November payment. In addition, the permanent Loan

Modification and Amendment Agreement stated that BmTowers (Defendants) were required to

comply with the requirements of the mortgage to pay taxes, insurance and escrow items. (See

Paragraph 4 of Exhibit E).

As previously indicated, the Trial Loan Modification Letter indicated the Defendants were also

to pay $4129.20 to be applied to the negative escrow. That amount was not paid. But a review of

the payment history indicates the first three payments of $678.56, essentially the three trial

payments, were applied to the negative escrow. (See Exhibit GI). The foutth payment went to

the November payment pursuant to the permanent Loan Modification, and with it a principal

reduction was realized. (See Exhibit GI).

After entering the Loan Modification, all payments made by the Defendants were in the $410

range . Defendants testified that upon entering the permanent Loan Modification they understood

from their discussions with Sherry Giles that they would only be paying a monthly amount for

principal and interest, and they were no longer required to pay escrows. (See also Defendant's

Exhibit 5).

7 The first payment due after signing the Loan Modification was for December, which Defendants

made but only in the amount of $410. The Bank promptly sent Defendants a "short letter" dated

December 24, 2014, advising them their payment was insufficient for the full amount due and

that their new payment was $656.56. (See Exhibit Fl). Defendants testified they contacted

Sherry Giles to inquire why they were now being required to pay escrows, and she supposedly

told then she " .. would take care of it." In the subsequent months Defendants continued paying

only $410. They testified they made contact with Sherry Giles on several occasions and each

time she told them she would take care of it, but then eventually she stopped taking their calls.

Defendants are asking the court to find that the Loan Modification required them to make

monthly payments for only principal and interest, and that they were no longer required to pay

escrows. The court declines to make such a finding. As previously discussed, the payments

required during the trial period were for an amount that represented principal and interest, plus

an amount for escrows. As suggested by its name, the trial payment plan was to test whether the

Defendants could consistently make the required payments after a lengthy period of falling

behind and no payments. Successful with the tlll'ee trial payments, the Bank offered Defendants

the permanent Loan Modification and Amendment Agreement. That document clearly stales that

Defendants c1rc to comply with all other requirements of the mortgage regarding payment of

taxes, insurance, escrows and the like. Given that the Defendants were so arrears in their escrow

payments, it is improbable that a lender in the Bank's position would waive the escrow

requirement. In summary, the Bank has proven by a preponderance of the evidence the monthly

payment due pursuant lo the Loan Modification was to include cscrows ..l (Sec Exhibit G 1).

3 The court notes that Defendants asserted that Ms. Giles agreed to waive escrows, yet despite

8 2.Breach

Whether there was a breach is focused on the payment history after the permanent Loan

Modification and Amendment Agreement was executed in November 2014. The Payment

History does show that after entering the Loan Modification, ti ve payments in the amount of

$410 were made. 4 These payments were not sufficient to pay the escrow items as required by the

mortgage and Loan Modification. (Exhibits Band E). As the payments being made were

insufficient to cover the total monthly mnount due, Mr. Baker explained that the payments were

held, and when sufficient funds had accumulated they were applied to the monthly amount due.

As the five payments of $410 were received over the period of December 2014 through June

2015, they were ultimately applied to the amounts due for principal, interest and escrows for

December, 2014 and January, February and March 2015. (See Exhibit G 1 and Defendants'

Exhibit I). Although the Bank sent to Defendants "short letters" dated December 24, 2014 and

May 20, 2015 in which it indicated their payments were insufficient to cover the amount due,

particularly escrows, the Dd'enclants never increased their payments above $410. The court finds

that the Bank has proven by a preponderance of the evidence thal the last payment made and

credited was the payment due i<)r March 2015, and fm1ber finds Defendants are in default of the

mortgage and owe on the note for as of the April 20 I 5 payment.

being still employed by the Bank and subject to a subpoena, she was not called to testify. Also, dming trial reference was made to collection activity reports in which entries are made recording all communications made with customers. This report was not introduced into evidence, although Bank's counsel represented to the comt that there were no entries in the report supporting the Defendants' assertion that Ms. Giles had agreed to waive escrows. In response to the court's inquiry, Defendants' counsel indicated a document request for the report was never made. The court did not rely on this information in making its finding, but merely points it out for informational purposes. '1 A sixth payment was also made but retw·ned.

9 3.Amount Due

As previously discussed, Defendants owe on the note as of the April 2015 payment. After

applying the March 2015 payment, the last payment made, the principal balance on the note is

$4720 l.33. (See Exhibit G l ). In addition, Exhibit K was admitted as a summary of the amounts

due as of July 6, 2018 for principal, interest, late charges, escrows and other fees and expenses.

Mr. Baker provided testimony establishing the foundation of Exhibit K. Regarding the fee and

expense detail, Mr. Baker could not identify what comprised the deferred amounts listed as

$6484.30 and therefore that amount is disallowed. All other amounts listed in Exhibit K are

consistent with the Payment History, Exhibit G 1, and are found to be reliable and trustworthy.

Accordingly, the itemization of the amounts due are:

Principal- $47201.33;

Jnterest- $11,463.05;

Late Charges- $163. 70;

Escrow- $10,084.90;

Fees &Expenses-$1,810.32

TOTAL- $70,723.30

In addition, the Affidavit of Counsel Stephanie A. Williams indicates the Bank has incurred

$10,656.04 in fees and disbursements, which amounts are supported by the itemization in the

anidavit. See HSBC Bank USA, NA. v. Gabay, 2011ME101,127. The court finds that the

Bank has proven hy a preponderance of the evidence that the total amount due on the mortgage

is $81J79.34.

10 4. Order of Priority and Amount Due Other Parties- not applicable.

5.Notice of Default

At trial the Bank introduced the Notice of Righi to Cure sent by DuaneMorris, as counsel for the

Bank to the Defondanls dated December l 7, 2015 5 (Exhibit 1). The notice was senl with a

certificate of mailing to both the Defendants, Terry Cormier and Jodina Cormier to their address

at 83 Pine Street in Presque lsle, Maine. Mr. Baker provided testimony regarding the issuance

and service of the notice. explaining that although the document was prepared by Bank's

counsel. he was familiar with the document as it was prepared using data and figures the Bank

provided, and the document was reviewed, edited and approved by Bank personnel before the

letter was mailed by counsel. Sec Deufsche Bank National frusf Company v. L<:dJins, 2018 ME

47. Although Mr. Baker was qualified lo lay the requisite foundation for (he introduction of the

Notke of Right to Cure, the content of the notice must still strictly comply with 14 M.R.S.A

§6 l I, including an itemization of all past due amounts causing the loan to be in default and an

itemization of any other charges that must be paid in order to cure the default. Sec JPMorgan

Chase Bank. NA. l'. Lowell. 2017 ME 32, 1 13 and 18.

Defendants point out that two Notice lo Cure Default Letters were issued to them. The first,

prepared by the Rank and dated July 16, 20 l 5 indicated the mnount due was $73 l4. l 7 to be paid

within 35 days of receipt. The second, prepared by Bank's counsel. DuaneMorris and dated

December 17, 2015 indicated the amount due was $8527.65 to be paid by January 24, 2016.

5 Also admitted in evidence as Exhibit His a Notice of Right to Cure letter dated July 16, 2015 issued by the Bank. The Bank is not relying on this notice for the purpose of the foreclosure.

11 Defendants asse11 that the two notices are inconsistent with one another and therefore neither are

reliable, and that otherwise the notices do not comport with 14 M.R.S.A. §6111. Defendant does

not, however, spcci ficnl ly set forth how or why the notice dated December l 7, 2015 which the

Bank is proceeding upon is wrong, incorrect or non-compliant with §6111. None the less, the

court has undertaken the task of closely scrutinizing the notices for compliance, particularly the

December 17, 201 5 notice.

As staled, the Bank's Complaint for Foreclosure has attached to it the December 17, 2015 Notice

of Right to Cure Default, and that is the notice upon which the Hank relies to prove its case. The

court will however also discuss the first notice and compare it to the second notice to test their

reliability and lruslworthiness.

To conduct this analysis, a fact which needs to be determined is what was Defendants' monthly

payment alter the loan modification agreement was entered. Paragraph 2 of the Loan

Modification sets the monthly payment for principal and interest at $409.40, and further states

the requirement to comply with the terms of the mortgage regarding payments of escrow items.

See Exhibit E. As previously discussed, after entering the loan modification Defendants made

payments of only $410 which was insufficient to cover principal, interest and escrows. Hence,

the Bank issued Defendants a short letter dated December 24, 2014 indicating they were to remit

an additional $223 .12 and that their monthly payment was $656.56. Exhibit F 1. But Defendants

still failed to remit payments sufficient to cover the escrows. Accordingly, the Bank issued

Defendants a second short letter dated May 20, 2015. Exhibit F2. In Lhis short letter the Bank

12 instructed the Defendants to remit an additional $330.00 for the escrows and further informed the

Defendants that as of March 1, 2015 their monthly payment was $740.00.

After May 20, 2015 the payment histo1y shows Defendants still failed to ever pay more than

$410 per month. See Exhibit G l. Combining partial payments, the March 2015 payment was

credited as paid in full, with $285.92 applied to interest and $123.48 applied to principal

($409.40 in total for principal and interest, consistent with the Loan Modification) and $330.60

applied to escrows. for a total of $740, consistent with the monthly payment specified in the last

Short Letter. See Exhibit G l. Further payments sufficient to cover the total amount of $740.00

for principal, interest and escrows after the payment due atler March 2015 were not made.

By letter dated July 16, 2015. the Bank issued Defendants a Notice of Right to Cure informing

Defendants they were four payments overdue. In reviewing all of the documents, this is correct

as they owed for April, May, June and July. The Notice also itemized the principal and interest at

$1637.60, which equals $409.40 per month for four months. and similarly itemized the amount

f'or escrows at $1322. 40, which cquc1ls $330.60 for four months. See Exhibit H. Accordingly, the

notice sent by lhe Bank dated July 16, 2015 is mathematically correct with respect to the

amounts due for principal, interest and escrows when compared with other documents and

payment history. 6

6 There was no evidence introduced regarding how appraisal fees were calculated, but again, the Rank is not relying on this notice lo prove it is entitled to a foreclosure.

13 Still no payments were made by the Defendants. Several months passing, a second Notice of

Right to Cur~ was issued on December 17. 2015. This notice was sent by Bank's counsel,

DuaneMorris. See Exhibit I. As previously discussed, this notice was prepared by counsel but

with data provided by the Bank, and was reviewed and edited by the Bank prior to issuance. The

court feels this is sufficient foundation for the introduction of the document per Eddins. But it

still must be c01Tect.

Mr. Baker testified that the amounts due as of Oeccmber 17, 2015 and utilized to prepare the

Notice of Right to Cure are as itemized in Exhibit J, which is a document prepared by the Oank

on December 16, 2015. Exhibit J itemizes nine monthly amounts due for the months of April

201 S through December 201 S. For each month, the amount itemized for principal and interest is

$409.40, precisely the amount set in the Loan Modification, for a total of $3684.60. As for

escrows, for the months of April 2015 through September 2015, the monthly amount is itemized

at $330.60, which again is consistent with a total monthly payment of $740 effective March I,

20 J 5 per the Short Letter dated May 20, 2015 ( Exhibit F2). But for the months of October,

November and December 2015, the itemized amounts for escrows in Exhibit .I are increased to

$351.60.

Reviewing the Payment History, Exhibit GI. on July 30, 2015 the Oank disbursed $1405.00 for

insurance and on September 23, 2015 disbursed $1227.17 for taxes. (See Exhibit G2 for

Transaction Code Definitions) . As previously discussed, the monthly amount for escrows is

adjusted from tune-lo-time as amounts for such items change. Accordingly, finding that

insurance and taxes were paid in July and September, 201 S, respectively, no irregularity is

14 caused by an adjustment to the monthly escrow amount for subsequent months and increasing it

to $351.60. The court finds the itemized total for escrows set at $3038.40 in Exhibit J is accurate

and reliable. Finally, the itemized monthly amount for late charges of $16.3 7 is also accurate and

reliable, for a total for the nine months being $147.33.

Again, as Mr. Baker explained, the itemized amounts from Exhibit J were the amounts set fotth

in the Notice of Right to Cure Default dated December I7, 2015, prepared by DuaneMorris. It is

clear DuaneMorTis utilized figures and data fi.1rnished by the Bank. To recap, the amounts

itemized in the notice are:

9 Payments of Principal and Interest $3684.60

Late Charges $147.33

Escrow Payments $3038.40

'l'otal $8527.65

The court finds the itemization and total for amount due to cure the default as set forth in the

Notice of Right to Cure Default dated December 17, 2015 are accurate, trustworthy and reliable.

Upon reviewing the balance of the Notice of Right to Cure (Exhibit T), the Court finds the

content of the Notice otherwise complies with the 35-day notice required by sub-section 1, it

contains the infonnation required under section 1-A, and it was issued in the marmer required by

sub-section 3(8). hy first class mail with a certificate of mailing. 14 M.R.S. §611 I ( 1), ( 1-A), (3).

The Certificate of Mai ling attached to the notice is dated December 17, 2015, Allowing for the

three days per subsection-3 B, a due date of January 24, 2016 as the last day to cure the default

15 complies with ~6111 (I). And the notice properly itemizes past due amounts and otherwise

properly informs Defendants or various rights and options as required by subsection I-A.

6.Mediation

The requirement of mediation was satisfied in accordance with 14 M.R.S. §6321-A(9) per the

Mediator's Report dated November 18, 2016.

7. Military Service

The Defendants appeared for trial.

In conclusion, the Court therefore finds that the Bank has established by a preponderance of the

evidence that il is entitled to Judgment of Foreclosure and Sale. 7 Judgement of Foreclosure and

Sale shall be issued pursuant to the proposed judgment provided by Plaintiff, and that these

findings, decision and order shall be incorporated therein. Pursuant to Rule 79(a) this order shall

be incorporated by reference in the Civil Docket.

Justice, Superior Court

7 The Court is cognizant of the Law Court's recent decision of M & T Bank v. Plaisted, 2018 ME 121 decided on August 16, 2018 indicating unredacted records arc necessary for submission pursuant to the business record exception. The case at hand was tried on July 6, 2018 prior to the M & T Bank v. Plaisted decision. In addition, unlike the situation in M & 1' Bank v. Plaisted, in this case there is but a single lender/servicer involved that generated the business documents and the issues of untrustworthiness that were apparent in M & 1' Bank v. Plaisted are not present in this case.

16 STATE OF MAINE SUPERIOR COURT AROOSTOOK, ss. CIVIL DIVISION DOCKET NO. RE-16-34 ) TD BANK, N.A. Uk/a First ) Massachusetts Bank, N.A., )

Plaintiff, ) ) V. ) ORDER AND DECISION ON PLAINTWJl''S ) MOTION FOR SUMMARY JUDGMENT TERRY CORMIER and JODINA ) CORMIER, ) ) Defendants. )

Before the court is plaintiff TD Bank's motion for summary judgment in a foreclosure

action against defendants Terry and Jodina Cormier. Having reviewed the parties' filings and

their respective arguments, and for the reasons stated below, plaintiffs motion to for summa1y

judgment is DENIED. 1

BACKGROUND

The following facts, viewed in the light most favorable to plaintiff as the non-moving

party, are undisputed and established in the summary judgment record.

On August 22, 200 I, defendants Terry and Jodina Cormier executed and delivered to TD

Bank a note in the amount of $57,000.00, which was secured by a mortgage on the property

located at 83 Pine Street, Presque Isle, Maine, and recorded in the South Aroostook County

Registry of Deeds in Rook 3550, Page 118. (Supp'g S.M ..F. ~ii 7-8.) TD Bank alleges it is, and

has been since the inception of the loan's origination, the holder of the note and the mo1tgage.

(!d. 1 12.)

1 As discussed with counsel at the hearing held August 2, 2017, a denial of summary judgment is

in no way indicative of the outcome at trial, where Plaintiff would have a live witness to lay the appropriattl foundation for admission of business records. On November 21, 2014, the Cormiers executed and delivered to TD Bank a loan

modification agreement, which provided a fixed interest rate and set new monthly principal and

interest payments. (lg. 110.) TD Bank alleges that the Cormiers failed to make the April 2015

payment and all subsequent payments. (Id.~ 15.)

On December 17, 2015, TD Bank sent a right to cure notice to the Cormicrs, which TD

Bank alleges was in compliance with 14 M.R.S. § 6111. (Id. ,1 16.) The Cormiers have not

cured their payment default. (I~. ii 20.)

The parties participated in mediations on July 27, 2016, and November 18, 2016, but

have not resolved the case. (I~.~ 29.)

Under M.R. Civ. P. 56, summary judgment is appropriate when review of the parties'

statements of material facts and record evidence to which the statements refer, considered in the

light most favorable to the non-moving patty, demonstrates that there is no genuine issue of

material fact that is in dispute and the moving party is entitled to judgment as a matter of law.

ijcal y, AJ_l§_t_at9 _In_s. <;o,, 2010 ME 20, 1 11, 989 A.2d 733. A material fact is one that can affect

the outcome of the case, and there is a genuine issue when there is sufficient evidence for a fact­

finder to choose between two competing versions of the facts. Stewart-Dore v. Webster Hos 1.

Ass'n, 2011 MR 26, 1 8, 13 A.3d 773. The evidence offered to establish a dispute as to material

fact, submitted in opposition to a motion for summary judgment, "need not be persuasive at that

stage, but the evidence must be sufficient to allow a fact-finder to make a factual determination

without speculating." Estate of mith v. ' umberland .nty., 2013 ME 13, ii 19, 60 A.3d 759.

When acting on a motion for summary judgment, a court may not make inforenccs based

on credibility or weight of the evidence. Arrow Fastener Co. v. Wrabacon, lnc., , 2007 ME 34,,

2 16,917 A.2d 123 (citing Y.:mcrson v. weet, 432 A.2d 784,785 (Mc. 1981)). A party who moves

for summary judgment is entitled to a judgment only if the party opposing the motion, in

response, fails to establish a prima facie case for each element of his cause of action. T,o ugee

_Qnsqvancy v. CitiMort~g9,J.m:,, 2012 ME 103, ~ 12, 48 A.3d 774.

Defendants argue that the Knox affidavit submitted in support of TD Bank's motion for

summary judgment is untrustwo1thy and therefore shouldn't be considered. This affidavit and its

suppotting documents provide proof of the necessary clements to plaintiffs motion for summary

judgment. See Bank of Am., N.A. v. Greenleaf, 2014 ME 189, ,r 18, 96 A.3d 700 (listing the eight elements of proof necessary to support a judgment of foreclosure).

An affidavit of a custodian of business records must demonstrate that the affiant meets

the requirements of M.R. Evid. 803(6). Business records kept in the course of regularly

conducted business may be admissible notwithstanding the hearsay rule if the necessary

foundation is established "by the testimony of the custodian or other qualified witness." M.R.

Evid. 803(6). "A qualified witness is one who was intimately involved in the daily operation of

the business and whose testimony showed the firsthand nature of his knowledge." !t/iBC,: M9~!&

Servs. v. Mur h , 2011 ME· 59, ~ 9, 19 A.3d 815 (quoting Bank of Am.._N.A. _v. Barr, 2010 ME

124, ,r 19, 9 A.3d 816) (4uotalion marks omitted)). The custodian or qualified witness must establish the following:

(a) The record was made at or near the time by---or from information transmitted by- - -someone with knowledge; (b) The record was kept in the course of a regularly conducted activity of a business, organization, occupation, or calling, whether or not for profit; (c) Making the record was a regular practice of that activity; (d) All these conditions are shown by the testimony or the custodian or another qualified witness, or by a certification that complies with Rule 902( 11 ), Ruic 902(12) or with a statute permitting certification; and (e) Neither the source of information nor the method or circumstances of reparation indicate a lack of trnstworthincss.

3 M.R. Evid. 803(6); Murphy, 2011 ME 59, ~ 10, 19 A .3d 815.

Plaintiff has established the necessary foundation as to elements (a)-(e) through the Knox

affidavit. (8ee Knox Aff. 11 1-6.) However, defendants point to an "inconsistency" which they

allege make TD Bank's business records untrustworthy and therefore inadmissible.

In evaluating trustworthiness, courts consider factors such as "the existence of a motive

and opportunity to prepare an inaccurate record, long delay prior to their preparation, the nature

of the information recorded, the systematic checking, regularity and continuity in maintaining the

records and the business' reliance on them." E. N . Nason Tnc. v. Land-Ho Dev. Cor . 403 A.2d

1173, 1179 (Me. 1979). When evaluating a motion for summary judgment, the court must

consider the trustworthiness of any affidavits submitted in support of the motion. Murphy, 2011

ME 59,, 11, 19 AJ

Defondants claim that the Knox affidavit is inaccurate because it misstates the date of the

Cormicrs' last payment. The Knox affidavit states that the Cormiers failed to make the April

2014 payment and all subsequent payments, and the records provided by TD Bank support this.

(~~~- Knox Aff. 1 15; Ex. E.) TD Bank has established, based on the business records provided, that the Cormiers made payments of $410 in April, May, and June, but that those payments were

applied to earlier months that had not been paid. (Pl.'s Reply Br. 4.)

However, the Cormicrs allege that TD Bank stopped accepting payments after their June

2015 payment. (Sec Jodina Cormier Aff. ir 9.) This occurred 6 months prior to TD Bank

sending them a notice of right to cure and thus prior to any acceleration. (Id .; Knox Aff. 1 14.)

This long delay in preparation and questionable motive of TD Bank makes the business records

untrustworthy. Sec E. N. Nason, 403 A.2d at 1179. Thus, the fOLmdation is insufficient to

satisfy the requirements of Rule 803(6), and the Court cannot consider them.

4 Since the Court cannot consider the Knox affidavit, and therefore cannot consider the

supporting business records, such as the note and mortgage, plaintiff TD Bank's motion for

summary judgment is denied.

The entry is:

l. Plaintiff TD Bank, N.A.'s motion for summary judgment is DENIBD.

(~/ 2. The Clerk is directed to incorporate this Order into-the cloel cl by reference pursuant to M.R. Civ. P. 79(a). .,{ ~ _,.... -,.,.;x)/

4 /0 Date: cf'-~r r1 ?:'tJ/;: / /-, , :7 c .

H,uo'Jd Stewrut / ( -..______).. . Justice, Maine Superior Court