Please ensure Javascript is enabled for purposes of website accessibility
Home / Courts / N.C. Court of Appeals / Real Property – Mortgages – Foreclosure – Lost Note – Holder in Due Course

Real Property – Mortgages – Foreclosure – Lost Note – Holder in Due Course

Numerous affidavits from CitiMortgage support the trial court’s finding of fact 12: “After the [debtors’] Note and Deed of Trust were transferred to CitiMortgage, the original Note was lost. CitiMortgage offered testimony by affidavit that 1) CitiMortgage was in possession at the time the original Note was lost or destroyed; 2) after a good faith, thorough and diligent manual search, CitiMortgage was not able to locate the Note; 3) The loss of possession was not the result of the Note being assigned, endorsed, delivered to another party, cancelled, pledged, hypothecated [or] otherwise transferred.”

This finding of fact tracks the required elements to establish that a party not in possession of an instrument is nonetheless entitled to enforce the instrument as set out in G.S. § 25-3-309(a), and the trial court properly concluded that CitiMortgage was the holder in due course of a valid debt and was entitled to proceed with the power-of-sale foreclosure under the terms of the parties’ deed of trust.


In re Frucella (Lawyers Weekly No. 011-308-18, 9 pp.) (Valerie Zachary, J.) Appealed from Mecklenburg County Superior Court (Carla Archie, J.) Donald Pocock for petitioner; James Galvin for respondents. N.C. App.


Leave a Reply

Your email address will not be published. Required fields are marked *