Today's New York Times refers to a recent decision by the Supreme Court of Kansas in the case of Landmark National Bank v. Kesler, et al., No. 98,489 (Kansas 2009) involving the controversial organization known as "MERS" - the Mortgage Electronic Registration Systems, Inc. MERS was established by large lenders as a quasi-parallel recording recording system to facilitate electronic trading and tracking of mortgages.
The Kesler case involved a routine residential foreclosure by the holder of the first mortgagee, Landmark National Bank. Landmark included as defendant the homeowner and Millennia Mortgage Corp. who per the public records held the mortgage. Sovereign Bank and MERS as its nominee were not included as defendants and subsequently claimed to be the assignees of Millennia.
The court stated that it would base its decision on the true roles of the parties and not the mere "nomenclature" used in the mortgage document. The court found that the form of the mortgage designated MERS as the mortgagee but not the lender.
The court found that MERS had no right to the underlying debt repayment secured by the mortgage and did not even act as the servicing agent. The court found that MERS was only the agent of the lender.