The Supreme Court of New Hampshire ruled in favor of New York Community Bank, finding that as assignee of MERS, it was authorized to foreclose. 

 In Bergeron v. New York Community Bank, the plaintiff challenged the defendant’s authority to foreclose, alleging the defendant did not prove that it was the genuine holder of the note and seeking an order to restrain the defendant from foreclosing.

The trial court ruled the defendant had the authority to foreclose and the plaintiff appealed.

“We are pleased that the Supreme Court of New Hampshire recognizes that plain language in the mortgage agreement signed by borrowers at closing establishes the lawful agency relationship between MERS and a lender and its successors,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith. “The New Hampshire Supreme Court ruling recognizes MERS authority to take actions on behalf of the lender, including assigning the mortgage.”

In its ruling, the Supreme Court of New Hampshire found that an agent of the note-holder may institute foreclosure proceedings under New Hampshire law. “Accordingly, ‘the question becomes whether … the language of the Mortgage alone conclusively establishes an agency relationship between’ the defendant, as assignee of MERS, and any downstream assignee of [the lender] that held the Note at the commencement of foreclosure.  Metlife, 286 P.3d. at 1156-57. We believe that it does,” the high court also noted. “The agreement plainly authorizes MERS to act on the Lender’s behalf, albeit in a limited way, thus evidencing the existence of an agency relationship.” 

The court went on to find that the defendant, as the assignee of MERS and agent of the noteholder, was authorized to initiate foreclosure.

“Because the Mortgage evidences an agency relationship between the [original lender] and the mortgagee (MERS), and the Mortgage contemplates that … MERS could assign [its] interest … we conclude that the defendant has the authority, as the agent of the noteholder, to exercise the power of sale,” the court held.