I am pleased that Abate reaffirmed the types of claims that homeowners do have for foreclosure defense, including declaratory judgments, quiet title, and injunctions. As the Court stated, these are better causes of action for fighting foreclosure, leaving homeowners with the means necessary for defending these cases.
The Supreme Judicial Court released its highly anticipated decision in Abate v. Fremont Investment today, considering whether homeowners challenging a foreclosure could use the try title statue as a cause of action in these types of cases. The Court’s decision in Abate limits the use of try title as a means of challenging a foreclosure in Massachusetts.
“Try title” is a cause of action that allows a person with (1) record title of property who is (2) in possession of the subject property to compel someone with an adverse claim to the property to assert their interest in the property or forever be barred from doing so. Try title requires the other person, in essence, to “put up or shut up.” This cause of action shifts the burden of proof onto the party with the adverse claim and forces them to prove their case. Try title is often used in boundary dispute cases, for the purpose of resolving all outstanding property claims in a single action. Try title claims, importantly, may only be brought in Massachusetts Land Court.
In Abate, a homeowner who had been foreclosed attempted to use a try title case against the foreclosing entity, by arguing that he only needed to alleged record title and possession to bring such a claim. Once he did so, Abate argued, the case could proceed.
Not so, said the Supreme Judicial Court. The Court held that these two required elements, record title and possession, were subject to dismissal if the homeowner could not show a viable claim by a preponderance of the evidence (more likely than not). The Court upheld the dismissal of this case because Abate could not show record title to the property, for the reason that Abate’s claims that the foreclosure was void (based mostly on challenges to the mortgage assignments) were not viable claims. The Court rejected Abate’s claim that merely alleging record title and possession were enough to bring a try title case. The Court also held that try title may only be used for foreclosure defense after a foreclosure has occurred.
Personally, I have never used try title for foreclosure defense for the simple reason that I do not consider Land Court an ideal place for these cases. Land Court is one of the best run courts in Massachusetts and a great forum for resolving general property claims, but its limited jurisdiction and lack of jury trials makes it less than desirable option for challenging foreclosures. A much better court for these cases is Superior Court, which has greater jurisdiction over claims relevant to foreclosure defense.