Opinion
15–P–1629
05-10-2017
CENTRAL MORTGAGE COMPANY v. Daniel C. LEE & others.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The defendant, Daniel C. Lee, appeals from a judgment declaring a mortgage to be valid and enforceable. He contends that a number of complications, errors, and misunderstandings rendered the mortgage invalid and unenforceable. We affirm.
Background. We summarize the facts found by the trial judge. Lee and his wife owned a house in Acton. They held the property as tenants in common. Lee's wife died intestate, and he inherited one-half of her interest in the property (or twenty-five percent of the total interest), while their two minor daughters inherited the other half (or twelve and one-half percent of the total interest each). Lee did not probate the estate immediately, as he believed (incorrectly) that he and his wife held the property by tenancy in the entirety with right of survivorship.
In 2004, Lee attempted to refinance the home. Lee received a loan commitment, but the bank's attorney requested that Lee probate his wife's estate and petition the Probate and Family Court (probate court) to appoint Lee as his minor daughters' guardian. The bank's attorney explained that the mortgage must extend to his interest and his daughters' interests in the property. Otherwise, lenders would not grant a mortgage because the bank would only be able to foreclose on the seventy-five percent of the property owned by Lee in the event of default. Lee accepted the advice, and the attorney initiated guardianship proceedings in the probate court.
Lee was appointed guardian of his daughters on December 30, 2004. The probate court had not yet, however, issued an order decreeing that Lee could mortgage the property. The bank's attorney, who also represented Lee in the guardianship proceedings, advised the parties to sign the mortgage documents on December 30, 2004, and represented that he would hold the documents and proceeds in escrow until Lee obtained permission to mortgage the daughters' interests in the property. After a hearing and the appointment of a guardian ad litem, a judge of the probate court granted Lee the power to mortgage the property on January 6, 2005. The mortgage was then released from escrow and recorded.
When the attorney recorded the mortgage, he added the handwritten annotation, "and as Guardian of Diane S. Lee and Nancy M. Lee" to the typed definition of "Borrower," which referred to "DANIEL C. LEE INDIVIDUALLY." The trial judge found that the attorney wrote in this annotation between the closing and the recording as "a clarification." The mortgage proceeds from the escrow account were distributed shortly afterward.
In May of 2010, Lee defaulted on the mortgage. Central Mortgage Company (Central) brought an action in Superior Court to quiet title to declare the mortgage valid and enforceable as to all interests in the property. Lee and his two then-adult daughters were named as defendants in the quiet title action. All the defendants appeared pro se. The trial judge entered a declaration finding the mortgage valid and enforceable as to all interests in the property.
Discussion. 1. Standing. As a threshold matter, we must consider whether Lee has standing to pursue this appeal on behalf of his daughters. "Standing can be addressed by an appellate court sua sponte even if not raised properly on appeal." Pugsley v. Police Dept. of Boston, 472 Mass. 367, 371, 34 N.E.3d 1235 (2015).
Lee does not have standing to appeal the validity of the mortgage as to his daughters' interests in the property. The daughters, now adults, are parties in their own right. The guardianship terminated by operation of law upon their majority. See G.L.c. 201, § 4, as in effect prior to the passage of the Massachusetts Uniform Probate Code, St. 2008, c. 521, § 21 ("The guardian of a minor ... shall continue in office until the minor attains the age of eighteen years and shall have the care and management of all his estate.") Cf. G.L.c. 190B, § 5–210 (2008) (guardianship terminates upon majority); Eccleston v. Bankosky, 438 Mass. 428, 433–434, 780 N.E.2d 1266 (2003) (guardianship ends "as a matter of law on [the ward's] eighteenth birthday"). The daughters have not appealed, and Lee no longer has authority to appear on their behalf.
See G.L.c. 221, § 46A (forbidding practice of law in Massachusetts by anyone other than member in good standing of Commonwealth's bar); LAS Collection Mgmt. v. Pagan, 447 Mass. 847, 849–850, 858 N.E.2d 273 (2006), quoting from Lowell Bar Assn. v. Loeb, 315 Mass. 176, 183, 52 N.E.2d 27 (1943) ("Plainly the commencement and prosecution for another of legal proceedings in court, and the advocacy for another of a cause before a court ... are reserved exclusively for members of the bar.")
Because, however, Lee appears at various points to request that the entire mortgage be declared void, we address his arguments to the extent that they apply to his interest in the property.
2. Identity of the mortgagor. Lee claims that the annotation on the recorded mortgage, adding the phrase "as Guardian of Diane S. Lee and Nancy M. Lee" to the definition of "Borrower," was an unauthorized material alteration that voids the mortgage. He maintains that the trial judge erred in crediting the attorney's testimony regarding the intent of the parties, and that the trial judge's determination that the annotation was a clarification is unsupported by the evidence and an error of law.
"We will not disturb the findings of [a] trial judge ... unless they are clearly erroneous." Woodward Sch. For Girls, Inc. v. Quincy, 469 Mass. 151, 159, 13 N.E.3d 579 (2014), citing Mass.R.Civ.P. 52(a), as amended, 423 Mass. 1402 (1996). "We review the judge's conclusions of law de novo." Kitras v. Aquinnah, 474 Mass. 132, 139, 49 N.E.3d 198 (2016).
Unauthorized postexecution material alterations to a deed are invalid. See Smigliani v. Smigliani, 358 Mass. 84, 90–91, 260 N.E.2d 917 (1970) ; Lima v. Lima, 30 Mass. App. Ct. 479, 487–488, 570 N.E.2d 158 (1991) ; Kurak v. South Point, Inc., 409 B.R. 259, 266–267 (D. Mass. 2009), aff'd 433 B.R. 52 (D. Mass. 2010). An alteration is material when it "change[s] the legal effect of the instrument." Mindell v. Goldman, 309 Mass. 472, 474, 35 N.E.2d 669 (1941). Nonetheless, an unauthorized material alteration does not void the entire instrument; the original terms of the instrument may still be enforced against the original parties to it. See Smigliani, supra at 90–91, 260 N.E.2d 917. Thus, even if the annotation was unauthorized, it would invalidate the mortgage only as to the daughters' interests. Lee has not made a reasoned appellate argument why the alteration would invalidate the interest Lee held and pledged in his own right. Again, since Lee is without standing to assert a claim of invalidity affecting only the daughters' interests, we need not consider the claim. For the following reasons, however, it is without merit even were we to consider it.
The trial judge determined that the handwritten annotation was a clarification, not a material alteration. The trial judge found that the attorney had explained to Lee that he would be encumbering the daughters' shares in the property and that Lee understood this at the time he signed the mortgage. Furthermore, Lee signed the mortgage in multiple places in his capacity as his daughters' guardian. Finally, the trial judge found that Lee was declared the guardian of his daughters because it was his intent to mortgage their interests in the property. The trial judge's finding that the annotation was a clarification intended to accurately reflect the understanding of the parties was not clearly erroneous.
Lee points to what he considers to be inconsistencies in the attorney's testimony and between such testimony and the documents. The trial judge "credited the testimony that [the attorney] accurately explained the transaction to [Lee]" and found that Lee understood "that by signing the mortgage both individually and as his daughters' Guardian, he would be mortgaging their interests as well as his own." "[I]t is the trial judge who, by virtue of his firsthand view of the presentation of evidence, is in the best position to judge the weight and credibility of the evidence." Picard v. Zoning Bd. of Appeals of Westminster, 474 Mass. 570, 575, 52 N.E.3d 151 (2016), quoting from New England Canteen Serv., Inc. v. Ashley, 372 Mass. 671, 675, 363 N.E.2d 526 (1977). We will not disturb the trial judge's credibility determinations. See ibid.
Lee cites Kurak, supra, and Riley vs. InstaMortgage.com (In re Smith), Bankr. Ct., 07–14013–FJB, slip op. at 28, 2015 WL 4330312 (D. Mass. July 15, 2015) ( Smith ), for the proposition that "[w]here a mortgage goes to the trouble of clearly and expressly defining a term, a court should not read other parts of the document to implicitly amend the definition[.]" In Smith, supra at 8, nothing in the mortgage outside of interlineations indicated that the debtor, a tenant in common with the named mortgagee, was a party to the mortgage. Here, Lee signed in his capacity as guardian on the original mortgage form without any interlineation. Furthermore, the named mortgagee in Smith had no authority to bind the tenant in common. Ibid. Here, by contrast, the guardianship was intended to vest Lee with the power to mortgage his minor daughters' interests in the property. Finally, in contrast to both Kurak and Smith, the trial judge here made a determination that the annotation was a clarification, not a material alteration. The trial judge's factual findings are supported by the record, and he committed no error of law.
Lee makes passing reference to the fact that the mortgage was executed, but not recorded, before he was appointed guardian of his minor daughters. He does so in the context of his challenge to the trial judge's credibility findings, which we have addressed. To the extent that he attempts to raise some other claim, this reference does not rise to the level of appellate argument. We do not consider it for this reason, and for the additional reason that it pertains only to the daughters' interests, as to which he has no standing.
3. Notice. Lee claims that the mortgage is void because the notice of the petition for authority to mortgage the property filed in probate court was not served on the daughters. See G.L.c. 202, § 29 (permitting guardian to mortgage ward's real estate "if, after notice and a hearing, it appears to be necessary or expedient"). Again, any defect in notice would affect only the daughters' interests, which Lee lacks standing to raise. Lee offers no reasoned argument why such a defect should invalidate the mortgage as it relates to his interest in the property.
In any event, the petition for Lee to be appointed guardian and the petition for permission for Lee to mortgage the property were filed with the probate court at the same time. With respect to the petition for appointment as guardian of minor children, the statute then in effect required "not less than seven days' notice ... to the mother and father of [the] minor[s], if living, unless they have assented to the filing of [the] petition." G.L.c. 201, § 2. Lee assented both as the petitioner for guardianship and as the sole surviving parent of both daughters. Notice was proper.
Lee contends that the trial judge erred in finding that "there is no statutory requirement of notice in the case of a mortgage by the guardian," arguing that G.L.c. 202, § 28, governed and required "notice to all persons interested." General Laws c. 202, § 28, applies to mortgages by an executor or administrator. Lee petitioned to mortgage the property in his capacity as guardian; he was not acting as the executor of his wife's estate. The trial judge properly determined that G.L.c. 202, § 29, governed.
4. Assignment. We agree with the trial judge's conclusion that any errors on the face of the recorded assignment are mere scrivener's errors, which do not invalidate the transfer of title from Mortgage Electronic Registration Systems, Inc., as nominee for the original mortgagee, to Central. See Krueger v. Devine, 18 Mass. App. Ct. 397, 403, 466 N.E.2d 133 (1984) (resolving scrivener's error in tax deed was within discretion of judge); Ward v. Ward, 70 Mass. App. Ct. 366, 369 n.5, 874 N.E.2d 433 (2007) (deeds may be reformed where there has been scrivener's error); Sullivan v. Kondaur Capital Corp., 85 Mass. App. Ct. 202, 213, 7 N.E.3d 1113 (2014) (scrivener's error in assignment "need not itself invalidate the assignment").
Judgment affirmed.