On April 21, Judge Joyner denied Defendants’ second motion for summary judgment. In the motion, the Defendants contended that the recording statute was unconstitutionally vague as applied to them if it required them to record the transactions at issue in this lawsuit.
Specifically, they argued that the statute “fails to give notice as to who must do the recording when a promissory note is transferred, when the recording must take place, or what must be created and recorded to reflect the transfer of a promissory note.”
However, Judge Joyner upheld the constitutionality of the statute requiring the registration of deeds. In terms of where the recording of the mortgage must take place he wrote, “the answer . . . is easily discerned: recording should be effectuated in the office of the recorder of deeds for the county where the property is situate within ninety days of execution, notwithstanding that there is a grace period of an additional ninety days before a deed, mortgage or defensible deed may be deemed insufficient to convey good title.” As for who must do the recording, Judge Joyner has “little difficulty” concluding that both parties to a transfer should record, and that this is especially important for the mortgagee.
He concludes the decision by stating: “Hence the standard is very simple: if the holder of an interest in land wishes to protect and maintain that interest, it must record the document by which that interest is memorialized. We find nothing vague about it.”
The decision suggests that Judge Joyner is receptive to Plaintiff’s core legal theory. Nonetheless, he has not explicitly resolved whether “the mortgage follows the note” (Plaintiff’s core theory) or whether the transfer of a note does not automatically transfer the legal title to the corresponding mortgage (Defendants’ core theory). That is the key legal issue in this case, and its resolution will be crucial or even outcome-determinative. Judge Joyner will have to confront that issue directly when he decides the cross-motions for summary judgment.