Boston bankruptcy lawyers are often contacted to file Massachusetts bankruptcy to stop a foreclosure. Sometimes they need to file bankruptcy so that they can discharge their consumer debt, giving them the funds available to avoid foreclosure. Sometimes, our clients buy property at foreclosure sales. Today’s blog entry on http://www.bostonbankruptcylawyerblog.com/ is concerning buying foreclosed property.
In a recent case handed down by the Massachusetts Supreme Judicial Court, Massachusetts foreclosure procedures were at issue. Actually, it was the validity of the title that the buyers of foreclosed property received that was the issue. As a result, the buyer did not have legal “standing” to file the lawsuit. Without standing, your case will be dismissed. Before we discuss the case, we will try to explain standing. If you are injured as a result of a Massachusetts car accident, you have “standing” to file a lawsuit against the person who caused the collision. If you observed the accident and feel that the driver was driving too fast, you do not have “standing” because you were not injured; you don’t have a cause of action against anyone.
You are simply a witness. If you buy a house and the title is at issue, you would normally have “standing” to file a lawsuit against the seller. After all, you paid money, you are living on the property, wherefore you should be allowed to file a lawsuit in the local courts to determine the quality of your title.
In this case, Francis J. Bevilacqua v. Pablo Rodriguez, Mr. Bevilacquo bought, or thought he bought property in Haverhill. The property had been foreclosed on by the bank, against Rodriguez, because of an unpaid mortgage. Rodriguez departed. Bevilacqua bought the property at a foreclosure sale. There was a problem with the title so Bevilacqua filed a claim in Massachusetts Land Court to validate, or clear, his title.
The Land Court determined that Bevilacqua did not have legal standing to file the lawsuit, so it dismissed the case with prejudice. He appealed. The SJC took the case from the Appeals Court to decide the issue. The Court called the case “highly unusual” because the defendant, Rodriguez, never appeared. In other words, Bevilacqua filed a lawsuit, the defendant failed to answer for file any appearance opposing the lawsuit, yet he still lost. Twice! But because the bank never followed the proper procedures, it never had the ability to foreclose. Wherefore, Bevilacqua never had record title, so he could not even allege “standing” to file the lawsuit.
In a blog article in our sister state of Maine, bankruptcy Attorney Richard Olson says this about the case: buyer beware. Be sure you have record title. Attorney Olson says do your homework before buying property at a foreclosure sale; hire an experienced title attorney to be sure you can get good title. Litigating a case in the Land Court and before the Supreme Judicial Court just may add costs that are unacceptable to get title. This is especially true when the banks have clearly mishandled the title documents and the foreclosure does not necessarily provide for clear title.