Quote: Adam said:
If I am reading this decision correctly, then in MICHIGAN without references to the Plat page and Lot numbers the mortgage is a nullity.
Is this a correct assumption? looking for your opinion, not legal advice..
While not disagreeing with Moose's response, I would disguish and elaborate in several respects. At the outset, I want to emphasize that I have NOT researched this issue in respect of Michigan law. You need to look to Michigan statutes and cases for the answer. And it is very much in your interest to consult a qualified Michigan attorney specializing in real estate (and, perhaps, equity) for a surer answer.
First, I would suggest that there is very likely to be some Michigan case law such as that discussed within the thread linked below and pertaining to incomplete instruments:
"Distinguishing Indorsement In Blank and Assignment In Blank"
Some of the cases from other jurisdictions discussed therein would seem to support the proposition that a deed or mortgage that was incomplete as to an essential element might be VOID. See for example the language from this ancient Illinois decision:
"The law is well settled that a deed without the name of a grantee is invalid. It is said there must be in every grant a grantor, a grantee, and a thing granted; and a deed wanting in either essential will be void." Richey v. Sinclair, 167 Ill. 184, 47 N.E. 364 (Ill. 1897).
The precise wording of the Michigan Statute of Frauds may be very important to such an analysis and the cases on the Statute of Frauds probably hold the first element of the answer.
But even if you found one or more Michigan cases holding that the absence of a property description is fatal to an instrument, the analysis probably doesn't END there. It would seem to me to be merely the beginning of a thoughtful inquiry.
Even IF a deed or mortgage was found to be wanting and even VOID, this would NOT necessarily leave the purported grantee without a remedy. There is a branch of Equity having to do with reformation of contracts, deeds and instruments.
Under equitable principles, a court will very often look to the intention of the parties. This inquiry typically begins with the express language found within the four corners of the instrument. But implicit in the very creation and exceution of the instrument is the rather clear idea that the parties intended that a mortgage be created to secure the note. And therefore to simply VOID the instrument seems contrary to this implict intention. Moreover, the mortgagor might thereby be unjustly enriched.
Putting this another way, would it be fair to you if YOU had been the grantee of a mortgage granted by someone else in which the property description was omitted.
So a court would probably look to other indications of the express intentions of the parties in respect of the mortgage at issue.
For example, Did your mortgage application identify the subject property? Did the original Lender obtain an appraisal of the subject property? Does the loan file contain a copy of the tax assessment for the property? Were the taxes for this property taken into account in underwriting the loan? Was the property mentioned in other closing documents, such as the HUD-1 Settlement Statement, the TIL Disclosure, other statutory disclosures?
Moreover, were the proceeds of the loan used to purchase that particular property? Or were the proceeds used to pay off another loan secured by the property?
And the evidence wouldn't end with an inspection of the primary documents associated with the original loan. You could be deposed under oath and asked about your understanding and intentions with respect to the loan.
Let me here distinguish between some alternative hypothetical fact situations and possible outcomes.
First, let us suppose that Smith purchases "Blackacre" from Jones and the purchase is funded with money advanced at closing by the Friendly Mortgage Company, Inc. Let us further suppose that Smith applied for the loan identifying "Blackacre" in his application. Further, the Friendly Mortgage Company obtains from Smith a copy of the contract of sale identifying Blackacre as well as a copy of the tax assessment from Smith. Friendly underwrites the loan in respect of tax charges on the property. Friendly obtains an appraisal of Blackacre. Friendly also has an engineer/surveyor complete a survey or survey opinion/plot plan of Blackacre.
The loan commitment letter expressly identifies Blackacre.
At closing, the HUD-1 Settlement Statement reflects that the loan made by Friendly is in respect of the purchase of Blackacre. Smith signs the HUD-1 Settlement Statement, as well as a Lead Paint Disclosure describing possible hazards associated with Blackacre. Jones is paid from the proceeds of the loan.
But the mortgage omits the property description or any other identifying information for Blackacre.
Under holdings in respect of an incomplete instrument, the mortgage might seem to be VOID.
But I believe that you would find almost universally that Friendly Mortgage would be entitled to a reformation of the mortgage to include the property description under these hypothetical facts.