Court of Appeals of New Mexico

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BAC HOME LOANS SERVICING, LP,
f/k/a COUNTRYWIDE HOME LOAN
SERVICING LP,
Plaintiff-Appellant,
v.
MARGO E. CRUZ and MONICA C. CRUZ,
Defendants-Appellees.

No. A-1-CA-35495

COURT OF APPEALS OF NEW MEXICO

April 18, 2018

APPEAL FROM THE DISTRICT COURT OF SANDOVAL COUNTY, John F. Davis, District Judge

COUNSEL

Little, Bradley & Nesbitt, P.A., Lucinda R. Silva, Albuquerque, NM, for Appellant

Eric Ortiz & Associates, Eric N. Ortiz, Albuquerque, NM, for Appellees

JUDGES

LINDA M. VANZI, Chief Judge. WE CONCUR: STEPHEN G. FRENCH, Judge, JENNIFER L. ATTREP, Judge

AUTHOR: LINDA M. VANZI

MEMORANDUM OPINION

VANZI, Chief Judge.

{1}       This interlocutory appeal arises from the district court’s order dismissing for lack of standing a foreclosure complaint filed years before our Supreme Court held in Bank of New York v. Romero, 2014-NMSC-007, ¶¶ 19-38, 320 P.3d 1, that the bank did not establish standing to foreclose when it could not prove that it had the right to enforce the promissory note on the mortgage (note) at the time it filed suit. Romero was the law when Defendants in the instant case moved to dismiss the foreclosure complaint for lack of standing, and was the explicit basis for the motion’s contention that standing to foreclose is a jurisdictional prerequisite that “must be established at the time the complaint is filed.” In response to the motion, Plaintiff BAC Home Loans Servicing, LP (BAC) submitted documents it contended established that it had standing at the time it filed suit. The district court treated Romero as controlling and cited the decision in ruling that the complaint should be dismissed without prejudice.

{2}       Following the district court’s oral ruling on the motion (although before entry of the written order), our Supreme Court issued a decision clarifying that “standing is not a jurisdictional prerequisite in mortgage foreclosure cases in New Mexico,” Deutsche Bank Nat’l Tr. Co. v. Johnston, 2016-NMSC-013, ¶ 9, 369 P.3d 1046, and that, while the plaintiff must prove that it held the note at the time it filed suit (i.e., standing), the proof is not required at the pleading stage but rather at the time standing is challenged by the defendant or raised by the court. Id. ¶¶ 26-27. Rulings in civil cases generally apply retroactively, unless the court limits the holding to prospective application, by express language or consideration of certain factors. Whelan v. State Farm Mut. Auto. Ins. Co., 2014-NMSC-021, ¶ 22, 329 P.3d 646; Marckstadt v. Lockheed Martin Corp., 2010-NMSC-001, ¶ 31, 147 N.M. 678, 228 P.3d 462. Nothing in Johnston indicates that any part of that decision is limited to prospective application.

{3}       Because Johnston allows a foreclosure plaintiff to establish that it had the right to foreclose when it filed suit after the issue is raised by the defendant, as BAC attempted to do in this case, and the district court dismissed the complaint without considering and ruling on the adequacy of BAC’s proffered proof, we reverse and remand to the district court for further proceedings in accordance with Johnston.

{4}       IT IS SO ORDERED.

LINDA M. VANZI, Chief Judge

WE CONCUR:

STEPHEN G. FRENCH, Judge

JENNIFER L. ATTREP, Judge