Cnty. of Montgomery Recorder v. MERSCorp Inc, No. 14-4315 (3d Cir. 2015)
Annotate this CaseMortgage Electronic Registration Systems (MERS) is a national electronic loan registry system that permits its members to transfer, among themselves, promissory notes associated with mortgages, while MERS remains the mortgagee of record in public records as “nominee” for the note holder and its successors and assigns. MERS facilitates the secondary market for mortgages by permitting members to transfer the right to repayment pursuant to the terms of the promissory note, recording such transfers in the MERS database to notify one another and establish priority, instead of recording such transfers as mortgage assignments in local land recording offices. It permits note holders to avoid recording fees. Recorders of deeds in Pennsylvania counties sued, seeking an injunction, and to recover millions of dollars in unpaid recording fees, contending that the MERS entities violated 21 Pa. Cons. Stat. 351. The Third Circuit rejected the claims, holding that section 351 does not create a duty to record all land conveyances and is so clear that certification to the Supreme Court of Pennsylvania was unnecessary. The transfers of promissory notes among MERS members do not constitute assignments of the mortgage itself.
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