MERS Wins Dismissal of Recording Fee Suit in Union County Illinois

Union County Joins Five Counties in Five States to Lose Case Against MERS

 

FOR IMMEDIATE RELEASE 
CONTACT: Jason Lobo
Phone: 703.652.1660
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Reston, Virginia, January 31, 2013— MERSCORP Holdings, Inc. today announced that Judge G. Patrick Murphy of the U.S. District Court for the Southern District of Illinois ruled yesterday in favor of MERSCORP Holdings, Inc., Mortgage Electronic Registration Systems, Inc.  and other defendants, dismissing a recording fee suit filed by Union County, Illinois. 

In Union County Illinois v. MERSCORP, Inc., et al Judge Murphy ruled that in Illinois “there is no mandatory duty to record” and as such Union County failed to state a claim for relief for violation of the Illinois Consumer Fraud and Deceptive Business Act, unjust enrichment, civil conspiracy or any declaratory or injunctive relief.

The four-count, class action suit, filed on behalf of Union County and all other counties in Illinois, alleged that MERS and its members failed to record mortgage assignments and therefore failed to pay the applicable county recording fees in violation of the Illinois’s recording statute, 765 ILCS 5/28 (Doc. 3-1). 

Judge Murphy, in analyzing the wording of the statue, was clear to distinguish the meaning of the phrase “shall be recorded.”  He noted that while “Section 28 does say that ‘mortgages…and other instruments relating to or affecting the title to real estate in this state, shall be recorded in the county in which such real estate is situated,’ ” he clarified that the statute is describing “how such instruments shall be recorded” not whether they should be.  In other words, the statute stipulates that if an entity decides to record mortgages, the mortgage shall then be recorded with the county.

“Therefore, in context and upon consulting Illinois Supreme Court and appellate court decisions, the Court finds that, by the plain meaning of 765 ILCS 5/28, there is no mandatory duty to record here and Plaintiffs’ complaint fails to state any claim upon which relief may be granted,”  Judge Murphy held.

“All MERS mortgages are registered in the local land records and all recording fees are properly paid by the lender at the time of recording,” MERSCORP’s Director for Corporate Communications Jason Lobo said.  “Union County, Illinois joins counties in five other states that have failed in pursuit of recording fee claims.”

For descriptions of cases and other materials pertaining to MERS’ business model and role in U.S. housing, please visit www.mersinc.org

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MERSCORP Holdings, Inc. is a privately held corporation that owns and manages the MERS® System and all other MERS® products.  It is a member-based organization made up of thousands of lenders, servicers, sub-servicers, investors and government institutions.  Mortgage Electronic Registration Systems, Inc. (MERS) serves as the mortgagee in the land records for loans registered on the MERS® System, and is a nominee (or agent) for the owner of the promissory note.  The MERS® System is a national electronic database that tracks changes in mortgage servicing and beneficial ownership interests in residential mortgage loans on behalf of its members.