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Union Trust v. MacQuinn-Tweedie
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MAINE SUPREME JUDICIAL COURT					Reporter of Decisions
Decision:	2001 ME 43
Docket:	Han-00-435	
Argued:	January 9, 2001	
Decided:	March 5, 2001

Panel:WATHEN, C.J., and DANA, SAUFLEY, ALEXANDER,  and CALKINS, JJ.






UNION TRUST

v.

LISA MACQUINN-TWEEDIE ET AL.



WATHEN, C.J.

	[¶1] M.O.M. Corporation and Main Street Associates, the holders of
an option, and other parties claiming by, through, or under them, appeal
from a judgment of foreclosure and order of sale entered in the District
Court (Bar Harbor, Staples, J.) in favor of the mortgagee, Union Trust, and
against the mortgagor, Lisa MacQuinn-Tweedie.  Guardian Trust, an
attaching creditor, appeals from the court's denial of its motion to
reconsider its finding that Guardian Trust was not a party in interest.  We
modify the judgment to include Guardian Trust as a party-in-interest, and as
modified, we affirm.
	[¶2]  The relevant facts may be briefly summarized as follows:  The
option holders received an option to purchase certain real property that was
subject to a mortgage held by Union Trust.  Union Trust brought an action to
foreclose on the mortgaged premises.  The court denied the option holder's
request to order Union Trust to assign the mortgage to them in return for
payment of the balance due on the mortgage, plus attorney fees, or to sell
the optioned premises separate from the rest of the mortgaged premises in
the event of a public foreclosure sale.
	[¶3]  The dispositive issues raised by the option holders on appeal
are:  (1) whether they are the legal equivalents of junior mortgagees for
purposes of compelling redemption and assignment pursuant to 14 M.R.S.A.
§ 6205 (1980);{1} and (2) whether their option survives the foreclosure and
continues as a unilateral right to purchase the optioned premises.  Both
contentions are without legal support.  
	[¶4]  We review a trial court's construction of a statutory scheme as a
matter of law.  See U.S. Dep't of HUD v. Union Mortgage Co.,Inc., 661 A.2d
163, 165 (Me. 1995). "The statutory civil foreclosure procedure preserves
two fundamental rights to a junior mortgagee: the right to redeem the
property from the senior mortgagee and the right to participate in a public
foreclosure sale and to receive any surplus proceeds after the senior
mortgage has been satisfied." Id.; see also 14 M.R.S.A. §§ 6205, 6321-6325
(1980 & Supp. 2000); Frisbee v. Frisbee, 86 Me. 444, 447, 29 A. 1115,
1116 (1894) (stating that any one who has an interest in mortgaged
premises, and would be a loser by foreclosure, is entitled to redeem). It also
provides the court with discretion to order assignment of the mortgage to
the junior mortgagee if certain conditions are met.  14 M.R.S.A. § 6205; see
also Bernstein v. Blumenthal, 127 Me. 393, 397, 143 A. 698, 699 (1928)
(finding that a junior mortgagee redeeming from a senior mortgagee may
also compel assignment of a mortgage if equity requires).  The plain
language of section 6205 is limited to junior mortgagees.  Neither at law nor
in equity is the holder of an option the functional equivalent of a mortgagee. 
Unlike a mortgagee, an optionee has no interest in the land.  An option "'is
nothing more than an irrevocable and continuing offer to sell and conveys no
interest in land to the optionee.'"  DiPietro v. Boynton, 628 A.2d 1019, 1023
(Me. 1993) (citation omitted).  Because the option is a contractual right
derived from the mortgagor, it does not survive the foreclosure.  The
optionees' remaining contentions do not warrant discussion.
	[¶5]  As for Guardian Trust's argument, we note that all parties
concede that Guardian Trust has an attachment against the premises and is
a party in interest.  As such, it has the right to receive surplus proceeds
after the payment of the prior mortgages and should have been included in
the list of priority claimants in the judgment of foreclosure and order of sale. 
14 M.R.S.A. § 6321 (Supp. 2000).
	The entry is:
Judgment amended to include Guardian
Trust as a party in interest.  As modified,
the judgment is affirmed.

Attorneys for plaintiff: Louis H. Kornreich, Esq., (orally) James S. Nixon, Esq. Gross, Minsky & Mogul, P.A. P O Box 917 Bangor, ME 04402-0917 Attorneys for defendants: Peter R. Roy, Esq., (orally) Roy, Beardsley, Williams & Granger, LLC P O Box 723 Ellsworth, Me 04605-0723 (for MacQuinn-Tweedie et al.) Stephen P. Beale, Esq., (orally) Skelton, Taintor & Abbott, P.A. P O Box 3200 Auburn, ME 04212-3200 (for Skelton, Taintor & Abbott) John A. McArdle III, Esq., (orally) Campbell & McArdle, P.A. P O Box 369 Portland, ME 04112-0369 (for M.O.M. Corp. et al.) William W. Willard, Esq., (orally) Bernstein, Shur, Sawyer & Nelson, P.A. P O Box 9729 Portland, ME 04104-5029 (for Guardian Trust) Roger G. Innes, Esq. P O Box 240 Mt. Desert, ME 04660-0240 (for Holly Parker) Brent A. Slater, Esq. 115 Franklin Street, Suite 2A Bangor, Me 04401 (for Ocean Properties)
FOOTNOTES******************************** {1} . The statute affording rights to junior mortgagees reads, in pertinent part: If the court, upon hearing, shall be of the opinion that the owner of such prior mortgage will not be injured or damaged in his property matters and rights by such assignment, and that such assignment will better protect the rights and interests of the owner of such subsequent mortgage, and that the rights and interests of any other person in and to the same real estate, or any part thereof, will not be prejudiced or endangered thereby, the court, in its discretion, may order and decree that such prior mortgage and the debt thereby secured shall be assigned by the owner thereof to the owner of such subsequent mortgage upon his making payment. 14 M.R.S.A. § 6205 (1980).