Can a mortgage servicer correct assignment errors made by other entities? Bradsen v. Shellpoint Explained

In Bradsen v. Shellpoint, the Utah Court of Appeals addressed whether a mortgage servicer could unilaterally correct assignment errors in a chain of title and whether a borrower’s loan modification request could restart the statute of limitations for foreclosure actions.

Background and Facts

Bradsen obtained a mortgage loan from Sand Canyon Corporation in 2007, which was assigned to Saxon Mortgage Services. After defaulting in 2009, Saxon accelerated all payments and recorded a notice of default. In 2013, Sand Canyon—not Saxon—purported to assign the deed of trust to RCS. In 2014, Bradsen applied for loan modification, acknowledging her debt. Years later, Saxon attempted to “correct” the 2013 assignment by recording a Corrected and Restated Assignment, claiming the original assignment contained a clerical error.

Key Legal Issues

The court addressed two primary issues: (1) whether Bradsen’s 2014 loan modification request restarted the six-year statute of limitations under Utah Code § 70A-3-118(1), and (2) whether Saxon could correct the 2013 assignment error under Utah Code § 57-3-106(9) or the relation back doctrine.

Court’s Analysis and Holding

The court affirmed that Bradsen’s 2014 letter constituted a “clear, distinct, direct, unqualified, and intentional” acknowledgment of debt that restarted the statute of limitations. However, the court reversed on the chain of title issue, holding that Saxon could not correct the 2013 assignment because it was not a party to that document. The error was too significant to qualify as a minor typographical or clerical error under § 57-3-106(9), and the relation back doctrine required correction by the same entity that executed the original document.

Practice Implications

This decision provides important guidance for practitioners handling foreclosure defense and chain of title challenges. Courts will carefully scrutinize attempted corrections of assignment documents, particularly when the correcting party was not involved in the original transaction. The case also confirms that borrowers’ communications acknowledging debt during loan modification processes can effectively restart limitation periods, making timing crucial in foreclosure defense strategies.