Public Interest Asserted Amicus Brief in Banking Case
On March 23, 2015 five public interest organizations filed an amicus brief to explain the substantial public interest in the outcome of a class action banking case to that has attracted national attention.
In Montgomery County, Pennsylvania, Recorder of Deeds v. Merscorp, Inc., a judge on the United States District Court of the Eastern District of Pennsylvania held that Pennsylvania law requires banks to publicly record mortgage assignments and, therefore, a bank-created system which bypasses public recording is unlawful. This was the first time a federal judge held that the system, called the Mortgage Electronic Registrations Systems, Inc. (MERS), violates state law. The case is on appeal before the Third Circuit and the parties have asked the Pennsylvania Supreme Court to weigh in on the state law question.
The amici curiae, Pennsylvania Legal Aid Network, Community Legal Service, Inc., Housing Alliance of Pennsylvania, National Association of Consumer Advocates and the Consumer Credit Counseling Service of Delaware Valley d/b/a CLARIFI, explained that the system allows banks to avoid millions of dollars of recording fees, a significant portion of which is statutorily designated to fund free civil legal services for low income Pennsylvanians and affordable housing for low income Philadelphians. The brief also explained the harm caused to the public, in particular, consumers, when the chain of interest in land is hidden within a private system with no guarantee of accuracy.
The amici were represented by the Public Interest Law Center, a non-profit law firm which uses high impact legal strategies to improve the well-being and life prospects of the region’s most vulnerable populations by assuring that they have access to the resources and services that all of us need to lead our lives.
The case has received national interest, with the Federal Home Loan Mortgage Corporation (“Freddie Mac”), the Pennsylvania Bankers Association (“PBA”), and the Pennsylvania Land Title Association (“PLTA”), weighing in on behalf of the banking industry; and, on behalf of the plaintiffs, the National Association of Independent Land Title Agents and PA Recorders of Deeds Association; a group of Harvard Law School Professors; and the Counties of Delaware, Chester, and Bucks, which have maintained public land records for over 300 years.