Fed. Nat’l Mortgage Ass’n v. Sundquist

Federal National Mortgage Association (FNMA) initiated an unlawful detainer action against Appellant, claiming ownership of Appellant's home pursuant to a trustee's deed it obtained from ReconTrust, a national bank that conducted a nonjudicial foreclosure sale in its capacity as trustee of the trust deed that Appellant had executed to secure her mortgage. After an immediate occupancy hearing, the district court entered an order of restitution requiring that Appellant vacate her home. At issue on appeal was whether ReconTrust had authority to conduct the foreclosure sale and convey Appellant's home to the FNMA where Utah Code 57-1-21 and 57-1-23 limits the power of sale to trustees who are either members of the Utah State Bar or title insurance companies with an office in Utah. The district court concluded that ReconTrust, as a national bank, was authorized to conduct the sale under federal law and that federal law preempted Utah law. The Supreme Court vacated the district court's order of restitution, holding that the relevant Utah statutes were not preempted by federal law, and therefore, a national bank seeking to foreclose real property in Utah must comply with Utah law. Remanded. View "Fed. Nat'l Mortgage Ass'n v. Sundquist" on Justia Law