Appellee Linda Brown filed this action against appellant Taylor, Bean & Whitaker Mortgage Corp. hereinafter “TB&W” and appellant Mortgage Electronic Registration Systems, Inc. hereinafter “MERS”, seeking, among other things, to cancel a security deed she had executed in favor of the appellants and to enjoin a pending foreclosure sale under the security deed. The trial court entered a default judgment against MERS, but has not entered a judgment granting any damages or relief based on the default. The trial court subsequently granted partial summary judgment to Brown against TB&W and against MERS in the event that MERS obtained a reversal of the default judgment. The summary judgment order canceled the security deed and enjoined the pending foreclosure. TB&W and MERS have now filed this appeal, contending primarily that the trial court erred in canceling the security deed. For the reasons that follow, we affirm in part and reverse in part. 1. On March 25, 2001, TB&W loaned Brown $144,800 for the purchase of a home. The loan was evidenced by a promissory note executed in favor of TB&W and a deed to secure debt executed by Brown in favor of MERS, as grantee. The security deed provided that “MERS is a separate corporation that is acting solely as a nominee for lender TB&W and lender’s successors and assigns.” It further provided that it was given to secure the repayment of the loan in question; that, for this purpose, Brown was conveying the property to MERS; and that Brown understood that MERS held legal title to the property, and that MERS, “as nominee for lender and lender’s successors and assigns,” had the right to foreclose and sell the property.1 After the closing, TB&W apparently sold the loan in the secondary market. In August 2001, Brown stopped making her loan payments. MERS published a notice of a foreclosure sale, and MERS stated that it was acting on behalf of TB&W.
Brown subsequently brought this action against numerous defendants, including TB&W and MERS. Her complaint sought, among other things, to enjoin the foreclosure sale, but it did not seek to cancel the security deed. TB&W filed a timely answer, and stated that it had sold Brown’s loan and was not the current holder of the promissory note, and it raised the defense that Brown had failed to join the current holder of the note as an indispensable party.
