Federal Home Loan Mortage Corp. v. Smith

Under ORS 86.797(1), “the participation of a ‘trustee’ is so fundamental to a ‘trustee’s sale’ that a sale cannot foreclose and terminate an individual’s property interest unless that sale is conducted by an actual trustee.” Wolf v. GMAC Mortgage, LLC, 276 Or App 541 (2016) (emphasis added).

Defendant appealed the trial court's judgement of restitution for the Plaintiff. Defendant assigned error to the trial court's conclusion that the Plaintiff was entitled to the premises, when the record lacked evidence that the sale was conducted by a lawful trustee. On appeal, Defendant argued that "Mortgage Electronic Registration Systems, Inc. (“MERS”) was not a duly appointed “trustee” within the meaning of the Oregon Trust Deed Act (OTDA). Plaintiff responded that ORS 86.797 conclusively terminates a borrower’s interest in a property where the borrower receives notice of the sale and fails to take action before the sale takes place. Under ORS 86.797(1), “the participation of a ‘trustee’ is so fundamental to a ‘trustee’s sale’ that a sale cannot foreclose and terminate an individual’s property interest unless that sale is conducted by an actual trustee.” Wolf v. GMAC Mortgage, LLC, 276 Or App 541 (2016) (emphasis added). The Court of Appeals held that the record did not permit a conclusion that a valid trustee’s sale occurred, and the trial court erred when it concluded otherwise. Reversed.