United States District Court, D. Hawaii
THE BANK OF NEW YORK MELLON FKA THE BANK OF NEW YORK, AS TRUSTEE FOR THE CERTIFICATEHOLDERS OF THE CWMBS INC., CHL MORTGAGE PASS-THROUGH TRUST 2006-OA5, MORTGAGE PASS THROUGH CERTIFICATES, SERIES 2006-OA5, a Delaware corporation, Plaintiff,
LEN C. PERRY JR., an individual; NATHAN JON LEWIS, an individual; and 3925 KAMEHAMEHA RD PRINCEVILLE, HI 96722, LLC, a Hawaii limited liability corporation, Defendants.
ORDER GRANTING PLAINTIFF'S MOTION FOR SUMMARY
DERRICK K. WATSON UNITED STATES DISTRICT JUDGE.
Bank of New York Mellon (“BONY Mellon”) moves for
summary judgment on its claims for quiet title and slander of
title, and request for declaratory relief against Defendants
Len C. Perry, Nathan J. Lewis, and 3925 Kamehameha Rd
Princeville, HI 96722, LLC (the “LLC”). The
claims arise from Defendants' improper and fraudulent
recordings, which have clouded title to Plaintiff's real
property and interfered with its property rights. Defendants,
without proper legal authority, filed financing statements
misrepresenting debts owed by BONY Mellon, and eventually,
recorded deeds purporting to convey title to themselves.
Because Defendants falsely held themselves out as owners of
record of the property, and deprived Plaintiff of the ability
to market, sell and/or collect rent from the property, BONY
Mellon continues to incur damages. The uncontroverted summary
judgment record establishes that Defendants have no legal
basis for claiming title to the property, which is
undisputedly vested in BONY Mellon, and accordingly, the
Court GRANTS the Motion for Summary Judgment on the second,
third, and fifth claims for relief in the Complaint.
Mellon was the foreclosing mortgagee on a Mortgage issued to
non-party borrowers who had defaulted on their loan. The $1,
129, 500 loan to the borrowers was secured by a Mortgage on
real property in Princeville, Kauai (the
“Property”) that was recorded on July 15, 2005 in
the State of Hawaii Bureau of Conveyances. Ex. A (Mortgage),
Dkt. No. 52-2. After the borrowers failed to make their
monthly payments due under the loan, BONY Mellon foreclosed
on the Property in a judicial foreclosure action, and the
Property was conveyed to BONY Mellon following the sale. Ex.
B (8/14/15 Decree of Foreclosure & Order Confirming
Foreclosure Sale), Dkt. No. 52-3; Ex. C (9/28/16 Am. Order
Confirming Foreclosure Sale), Dkt. No. 52-4. On October 19,
2016, a Commissioner's Deed was recorded transferring
title to the Property in fee simple to BONY Mellon. Ex. D
(Commissioner's Deed), Dkt. No. 52-5.
the same time period, Defendants recorded a number of
fraudulent documents in the State of Hawaii Bureau of
Conveyances that purported to transfer legal title to the
Property to Defendants. On April 26, 2016, for example, Perry
recorded a “Notice of Default/Notice of Fault -
Opportunity to Cure - Default Affidavit” (“Notice
of Fault”) in the Bureau of Conveyances. Ex. E (Notice of
Fault), Dkt. No. 52-6. The Notice of Fault was recorded
without BONY Mellon's knowledge, consent, or agreement.
Decl. of Caroline Trinkley ¶¶ 13-15, Dkt. No. 52-1.
BONY Mellon contends that its silence or failure to respond
to Perry's purported “Bonafide Offer/Offer of
Performance/Notice of Tender” to purchase the Property,
is not, and was not, a concession or admission that it
acquiesced to anything presented in the Notice of Fault. Nor
did BONY Mellon accept any purchase offer by Perry, or any
other Defendant, or make any implicit or explicit admission
regarding the statements in Perry's correspondence.
Trinkley Decl. ¶¶ 14-15.
27, 2016, Perry recorded a UCC Financing Statement
(“First UCC Statement”) in the Bureau of
Conveyances in which he listed himself as both the Debtor and
Secured Party in relation to collateral described as
“Registered Lien # 1A59600612 for $3, 981,
377.” Ex. F (First UCC Statement), Dkt. No.
52-7. On July 26, 2016, Perry recorded an amendment to the
First UCC Statement in the Bureau of Conveyances. Ex. G (Am.
First UCC Statement), Dkt. No. 52-8. The First UCC Statement
and amendment were recorded without BONY Mellon's
knowledge, consent, or agreement, and the UCC-1 statements
falsely identified BONY Mellon as a debtor. Trinkley Decl.
recorded several documents with the Bureau of Conveyances on
August 22, 2016, again without BONY Mellon's knowledge or
consent. He recorded a “Notice of Lien Affidavit and
Notice of Default, ” in which Perry claims that BONY
Mellon is indebted to him in the amount of $3, 981, 377.19
due to its “fail[ure] to answer the.... Private
Administrate Inquiry” and its “documented
attempts to deny and deprive [Perry] of his rights and
property[.]” Ex. I (Notice of Lien Affidavit), Dkt. No.
52-10. Perry also recorded a “Substitution of Trustee
and Full Reconveyance, ” asserting that he is the
“Beneficiary, under that certain claim number
3925KamehamehaPVH Notice of Default” and that RCO
Hawaii, LLLC and Plaintiff are the “Trustee(s)”
Ex. H (Substitution and Reconveyance), Dkt. No. 52-9. Perry,
acting as Beneficiary, purported to designate the LLC
Defendant as “Foreclosure Trustee and [to] hereby
RECONVEY thereunder.” Id. Defendants also
recorded another amended UCC financing statement in the
Bureau of Conveyances, without Plaintiff's knowledge or
consent. Ex. J. (Am. UCC Statement), Dkt. No. 52-11.
September 14, 2016, Defendants recorded an “Affidavit
of Foreclosure” in which Lewis purported to act as the
“foreclosure trustee” pursuant to a
“Financing Statement Lien” recorded on July 27,
2016. Ex. K (Aff. of Foreclosure), Dkt. No. 52-12. The
Affidavit of Foreclosure, filed without BONY Mellon's
knowledge, purports to foreclose on the Lien and take the
Property as collateral for the benefit of Perry. Id.
The LLC is purportedly substituted “as to the Trustee
to liquidate said trust with a Substitution and Full
Re-Conveyance Notice, ” and the “Trustee,
substituted [LLC] is moving in accordance with federal and
Hawaii Statutes carrying out the Non-Judicial
October 14, 2016, Defendants recorded another UCC Financing
Statement (“Second UCC Statement”) in the Bureau
of Conveyances, listing BONY Mellon as the debtor, the
Defendant LLC as the secured party with Lewis as an
additional secured party, and listing the collateral as the
Affidavit of Foreclosure recorded on September 14, 2016, with
a total collateral debt of $3, 981, 377.19. Ex. L. (Second
UCC Statement); Dkt. No. 52-13 On November 9, 2016, the LLC
recorded in the Bureau of Conveyances a Warranty Deed
(“Perry Warranty Deed”) purporting to transfer
title to the Property from the LLC to Perry. Ex. M, Dkt. No.
52-14. Then, on January 10, 2017, Perry recorded a conveyance
(“Lewis Warranty Deed”) whereby Perry, as
grantor, purportedly transferred title to the Property to
Lewis, as grantee. Ex. N, Dkt. No. 52-15.
to BONY Mellon, it is not indebted to Defendants, and never
owed Defendants $3, 981, 377.19 or any other sum of money.
BONY Mellon did not receive any monies, benefit, value, or
consideration for the purported conveyances of the Property
to Defendants, and did not ever authorize or intend for any
Defendant to record any documents relating to the Property.
BONY Mellon only became aware of Defendants' fraudulent
recordings when its agent, New Penn Financial, LLC dba
Shellpoint Mortgage Servicing, as attorney-in-fact, began to
attempt to market the Property for sale and discovered
Defendants' purported “tenants” residing at
the Property. Trinkley Decl. ¶¶ 33-34.
asserts that the Perry and Lewis Warranty Deeds currently
prevent it from taking possession of the Property, selling
the Property with free and clear title, and collecting any
rents on the Property. Trinkley Decl. ¶ 35. According to
Plaintiff, these filings have slandered BONY Mellon's
title and impaired its use and enjoyment of the Property.
Mellon filed this action on June 21, 2017, seeking
cancellation of certain instruments based on Defendants'
improper and fraudulent recordings in the land records
relating to Plaintiff's title to real property, including
the deeds purporting to convey title to Defendants.
See Compl., Dkt. No. 1. The Complaint asserts five
claims against Defendants for cancellation of instruments,
quiet title, slander of title, unjust enrichment, and
declaratory judgment. Compl. ¶¶
BONY Mellon seeks summary judgment on its second, third, and
fifth causes of action for quiet title, slander of title, and
declaratory relief. It contends that Defendants' claim to
title, premised on a “Notice of International Claim
within the Admiralty Administrative Remedy, ” is
unenforceable. Lewis and Perry did not file timely
oppositions to the Motion.
Defendants are proceeding pro se, the Court liberally
construes their filings. See Erickson v. Pardus, 551
U.S. 89, 94 (2007); Eldridge v. Block, 832 F.2d
1132, 1137 (9th Cir. 1987) (“The Supreme Court has
instructed the federal courts to liberally construe the
‘inartful pleading' of pro se ...