Tenth Circuit Court of Appeals Rules in Favor of MERS
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Tenth Circuit Court of Appeals Rules in Favor of MERS


Reston, Virginia, – July 15, 2014 – (RealEstateRama) — MERSCORP Holdings, Inc. today announced that the United States Court of Appeals for the Tenth Circuit recently ruled in favor of Mortgage Electronic Registration Systems, Inc. (MERS) and its co-defendants, affirming MERS’ role as mortgagee as nominee for the note owner.

In the case, In re Trierweiler, the Court rejected the trustee’s allegations that MERS’ involvement as mortgagee resulted in a separation of the mortgage and note, rendering the mortgage unenforceable. The Court’s decision affirmed the judgment of the U.S. Bankruptcy Court for the District of Wyoming.

In rejecting the trustee’s arguments that the MERS mortgage was unenforceable, the Tenth Circuit cited two of its prior decisions involving Utah law, Commonwealth Property Advocates v. MERS and Burnett v. MERS. In those cases, the Court had held that nothing prohibited the parties to the note and deed of trust from designating a party other than the note owner to act on behalf of the note owner, including enforcing rights granted in the deed of trust. Here, the Court ruled that the same applied under Wyoming law as well.

“The deeds of trust in Commonwealth and Burnett like the mortgage executed by the Debtors in the case at bar, contained materially identical language reflecting the agreement of all parties to the loan transaction that MERS would act as mortgagee solely in a representative capacity for the lender and any of its ‘successors and assigns,’” Judge Lucero wrote. “The Trustee has offered no convincing explanation as to why Wyoming law would treat promissory notes and security instruments any differently …”

“We are pleased with the appellate court’s affirmation of the bankruptcy court’s decision and recognition of MERS’ role as mortgagee,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith. “This is another clear instance where the ‘split the note’ theory has proven to be futile.”

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


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.

CONTACT: Janis Smith
Phone: 703-738-0230

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