Minnesota Foreclosure Case Law Update - Strict Compliance is the Absolute Rule

On December 23, 2013, the Minnesota Court of Appeals, in the case of Hunter v. Anchor Bank, N.A., specifically concluded that when two separate parcels of land secure one mortgage, each parcel must be sold separately at a foreclosure sale as required by Minnesota Statutes §580.08, and the failure to strictly comply with this requirement causes a non-compliant foreclosure sale to be void.  In reaching this determination, the Court relied on the Minnesota Supreme Court’s decision in Ruiz v. 1st Fid. Loan Servicing, LLC, in which the Supreme Court stated interpretation of the words and phrases in the foreclosure-by-advertisement statutes must be construed “according to their plain and ordinary meaning”, leaving no room for error or deviation.

 In rendering its decision, the Court of Appeals moved away from prior lines of cases previously stating that a single foreclosure sale of multiple parcels of mortgaged land is not void, but only voidable, and would not be voided unless good cause was shown, or fraud or prejudice resulted to the mortgagor or owner of the equity of redemption.

 The Hunter Court clearly articulated a different position based upon Ruiz:

 “For the reasons stated above, we conclude that Section 580.08 requires strict compliance.  If separate parcels of mortgaged property are not sold separately at a foreclosure sale, the foreclosure sale is void, without any need for the mortgagor to prove additional facts, such as fraud, prejudice, or good cause.”

Strict compliance with the foreclosure statutes in Minnesota is the absolute rule.  This is an onerous standard for Lender compliance, but Minnesota Courts are not tolerating any deviations from the plain language of the statutes.  


If you have any questions regarding the Hunter case, or the process for foreclosing mortgages secured by more than one property, please contact Nick Vivian.  Call 651-439-2878 or send an e-mail.

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Minnesota Foreclosure Case Law Update - Strict Compliance is the Absolute Rule


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