Real Property – Mortgages – Civil Practice – Standing

South Carolina Lawyers Weekly staff//March 29, 2013//

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Kain v. Bank of New York Mellon (Lawyers Weekly No. 002-051-13, 6 pp.) (J. Michelle Childs, J.) 7:12-cv-02031; D.S.C.

Holding: Where this matter concerns a negotiable instrument payable upon presentation by the holder in possession, the third-party debtors who are not beneficiaries of the pooling and servicing agreement (PSA) lack standing to challenge the holder’s rights to enforce the negotiable instrument due to any alleged invalidity in or noncompliance with the PSA. Moreover, under S.C. law, the debtors would not be subject to duplicative payment obligations because payment to the claimant would discharge the debtors’ liability to other claimants.

The bankruptcy court did not err in finding that the debtors did not have standing to challenge the PSA.

Even if the debtors had standing, their contention that the PSA was never executed is not borne out by the evidence.