Facts: A homeowner obtained a loan secured by a trust deed naming Mortgage Electronic Registration System (MERS) as the beneficiary. The trust deed did not name a trustee. The owner defaulted on the loan and MERS designated a trustee to initiate nonjudicial foreclosure. The trustee filed a notice of the trustee’s sale and the home was sold.
Claim: The owner sought to void the foreclosure, claiming the trustee’s sale was not valid since the deed of trust did not designate a trustee and thus did not grant the authority to foreclose.
Counter claim: The lender sought to uphold the foreclosure, claiming the trustee’s sale was valid since MERS as beneficiary had the authority to appoint a trustee prior to the foreclosure.
Holding: A California Court of Appeal held the foreclosure was valid since, regardless of whether the trust initially failed to name a trustee, the trustee designated by MERS prior to foreclosure had the right to foreclose. [Shuster v. BAC Home Loans Servicing (2012) ___ CA4th___]
