The federal court has dismissed a lawsuit filed by BankPacific Ltd. against the Small Business Administration over disputed land in Sinapalo, Rota.<\/p>\n
In granting the SBA\u2019s motion to dismiss last week, U.S. District Court for the NMI Chief Judge Ramona V. Manglona ruled that BankPacific Ltd. failed to include SBA in its (BankPacific) foreclosure suit before the Superior Court in 2013.<\/p>\n
Manglona said the 2013 foreclosure suit does not bind SBA and has not extinguished its right of redemption.<\/p>\n
Finally, the judge said, BankPacific has offered no additional authority, as SBA points out, that would allow the federal court to extinguish SBA\u2019s interests in the property.<\/p>\n
Manglona further stated that because the one-year right to redemption has not run against the SBA, the federal court lacks jurisdiction to quiet title.<\/p>\n
Manglona said because the court lacks authority to extinguish the SBA\u2019s lien interests in the property, it cannot grant BankPacific the relief it seeks.<\/p>\n
Accordingly, the judge said, granting SBA\u2019s motion to dismiss is not a \u201cwaste of time,\u201d as BankPacific insists. <\/p>\n
In its lawsuit, BankPacific, through counsel Michael A. White, asked the District Court to declare that SBA has no right, title, or interest to the lot.<\/p>\n
According to the complaint, couple Matthew A. and Rita M. Ooka executed a mortgage in favor of the Northern Marianas Housing Corp. on Oct. 3, 1995. The Ookas mortgaged a parcel of property in Sinapalo II, Rota.<\/p>\n
In 1997, NMHC assigned the mortgage to BankPacific.<\/p>\n
In 2003, the Ookas applied for a loan with SBA, mortgaging the same lot to SBA.<\/p>\n
In 2013, BankPacific filed a lawsuit in the Superior Court against the Ookas to foreclose upon its mortgage.<\/p>\n
In 2014, the Superior Court ordered that the lot be sold. White said the lot was sold and the sale was approved by the Superior Court.<\/p>\n
White said the foreclosure of BankPacific\u2019s mortgage on the lot, and the sale of that property, extinguished SBA\u2019s right to the property.<\/p>\n
SBA denied this in its motion to dismiss the lawsuit.<\/p>\n
SBA asserted that BankPacific failed to include SBA as a defendant in the foreclosure lawsuit pursuant to the Commonwealth\u2019s Real Estate Mortgage Law, thus the Superior Court lacked jurisdiction over the SBA and could not remove SBA\u2019s lien on the property.<\/p>\n
SBA also argued that because BankPacific did not perfect service on the SBA, as required by federal law, the SBA\u2019s lien survives.<\/p>\n
Finally, SBA argued that its right of redemption was not extinguished because BankPacific failed to give it notice or include it in the foreclosure action.<\/p>\n
But according to BankPacific, it had a superior interest in the property and therefore \u201cwhen [it] exercised its right [by foreclosing on the property], SBA\u2019s mortgage became a nullity.\u201d<\/p>\n
BankPacific also argued that SBA has no right of redemption.<\/p>\n
In granting the motion to dismiss, Manglona said in this case, BankPacific did not name the SBA as a defendant in the original complaint for foreclosure.<\/p>\n
Accordingly, Manglona said, the SBA, which has an interest in the disputed lot, has not had its rights extinguished by the 2013 foreclosure proceeding.<\/p>\n
Even assuming that CNMI law does not provide for a right of redemption by the SBA in these circumstances, the federal statute providing a right of redemption has not expired, Manglona said. <\/p>\n","protected":false},"excerpt":{"rendered":"
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