“privity of contract is an essential element of a cause of action on a contract”
How later courts described this case
- “privity of contract is an essential element of a cause of action on a contract”
- under the UCC, “it is no longer necessary that an instrument be so covered with previous indorsements that additional space is required before an allonge may be used”
Written by the judges who cited it.
The opinion
GURICH, J.,
with whom WINCHESTER, J. joins dissenting:
T1 The majority reverses solely on the issue of standing, finding that "standing was not established by the materials attached to Appellee's petition or motion for summary judgment because there was no attached indorsed note nor was there an assignment of the note." Majority Op. 18.
T2 The majority continues to fashion new requirements in mortgage foreclosure cases, this time, by requiring Plaintiff to have separate documentation at the time of filing that establishes that the transfer of the note included the Plaintiffs right to enforce the note. The majority finds that an assignment of the mortgage without an assignment of the note is not proof of the purpose for the alleged transfer of the note. I disagree.
T3 The Restatement Third of Property on Mortgages states: "When ownership of a mortgage is assigned to another ... the obligation secured by the mortgage is likewise transferred unless the parties agree that the obligation be retained by the transferor. In effect, the obligation will follow the mortgage even if not expressly mentioned in any document of transfer." Restatement (Third) of Property: Mortgages § 5.4 emt. c. Additionally, under the Uniform Commercial Code ("0.C.C.") when a transferee seeks to en-foree an unindorsed instrument, it must account for "possession of the unindorsed instrument by proving the transaction through which the transferee acquired it. Proof of a transfer to the transferee by a holder is proof that the transferee has acquired the rights of a holder." 0.0.0. § 3-208 emt. 2 (emphasis added).
T 4 In this case, the Plaintiff attached to its Petition a copy of the note, the mortgage, and an assignment of the mortgage. 1 Plain *337 tiff alleged in its Petition that it became the present holder of the note and mortgage "having received due assignment through mesne assignments of record, said assignment recorded in the office of the County Clerk in Document # 2008024539." 2 The assignment of the mortgage was proof of the purpose of the transfer of the note. There is no indication in the assignment of the mortgage that the parties intended anything other than to transfer both the mortgage and the note. As such, the note followed the mortgage even if the assignment of the note was not expressly mentioned in the assignment of the mortgage. The assignment of the mortgage was proof of the transaction through which the Plaintiff aequired the rights of the holder, entitling Plaintiff to enforce the note.
15 The majority criticizes the trial court for sustaining the Plaintiffs motion for summary judgment even though the motion was supported by evidentiary materials and the Defendants failed to respond. 3 Plaintiffs status as holder of the instrument, which likewise entitled it to enforce the note, was further bolstered by the presentation of an indorsed-in-blank allonge at the hearing on the Defendants' motion to vacate. The Plaintiff now has to go back to the trial court to establish the same uncontroverted facts.
T6 The majority, in today's case and in other recently decided foreclosure cases, created procedural requirements that are not applied in any other civil actions and are inconsistent with requirements found in established statutory and case law. Similarly, the majority reinterpreted the Oklahoma version of the U.C.C. to require more stringent requirements for enforcement of a negotiable instrument than were previously required. The Majority continues to use these new substantive and procedural requirements to vacate judgments entered by trial judges who applied the existing law to the facts presented and were correct in most, if not all, of the cases. Therefore, I respectfully dissent.
. Unless a party challenges the authenticity of an original document, pursuant to 12 O.S. § 3003 and 12A O.S. § 3-308(a), a copy is admissible.
. Plaintiff's counsel, by signing the Amended Petition, averred that Plaintiff had evidentiary support for these factual contentions. See 12 O.S. 2012 § 2011(B).
. See Rule 13, Rules for District Courts of Oklahoma, 12 O.S. Ch. 2, App.