Sabina v. JP Morgan Chase: Maine Mortgage Holders Must Send Original Discharge to Mortgagor
In Sabina v. JP Morgan Chase Bank, N.A., the Maine Law Court reaffirmed that mortgage holders in Maine must timely mail a discharge within 60 days after the conditions of the mortgage have been satisfied. 2016 ME 141. The Court further found that a photocopy of the discharge was not sufficient.
By way of background, the Maine Legislature in recent years passed several laws to ensure that mortgage holders timely discharge a mortgage. One such requirement is that, within 60 days after “full performance of the conditions of the mortgage,” the mortgage holder must issue a discharge of the mortgage. 33 MRSA § 551. A mortgage holder that fails to do so is subject to specified monetary damages. Section 551 was further tightened in 2011 when a requirement was added that a mortgage holder must mail the original registry-stamped discharge to the mortgagee by first class U.S. mail within 30 days after the mortgagor’s receipt.
In the Sabina case, the Law Court reviewed an appeal from a Superior Court decision which held that a bank’s use of a photocopy of a mortgage discharge was sufficient to meet the statutory requirement of giving notice of discharge. In a split decision, the Law Court found that the statutory requirement was “not ambiguous” and reversed the lower court’s decision that a photocopy was sufficient.
This case is a strong reminder that Maine has very strict statutory requirements regarding the discharge of mortgages.