by Gregory Todd, Esq.
Armstrong Teasdale LLP
USFN Member (KS, MO)

In a recent decision, the Court of Appeals for the Eastern District of Missouri handed down its decision regarding whether a notice of foreclosure sale published in a newspaper by the name of The Jefferson Countian was valid. The case is styled Jason A. Lewandowski v. Alabama Housing Finance Authority, et al., Missouri Eastern District Court of Appeals No. 109368.

At issue was whether the Countian was qualified to publish real estate foreclosure notices in Jefferson County, Missouri. The Countian is regularly engaged in publishing real estate foreclosure notices. The trial court found that the Countian was not qualified to publish notice and vacated the foreclosure sale.

The Court of Appeals reversed the trial court decision and took the additional step of granting summary judgment in favor of the newspaper, finding that it was qualified to publish Missouri non-judicial foreclosure sale notices. This is one of the first cases in Missouri that goes into detail regarding the requirements for a newspaper to publish Missouri non-judicial foreclosure sale notices. Had the appeal been denied, all prior foreclosure sales where the Countian published the notice of sale could be challenged and would run the risk of being declared void.

The foreclosure sale of the property occurred on Feb.8, 2019, and notice was published in the Countian from Jan. 11, 2019, to Feb. 1, 2019. Following the foreclosure sale, the borrower filed suit alleging wrongful foreclosure, violations of the Missouri Merchandising Practices Act, and to quiet title. The borrower alleged the Countian was not qualified to publish non-judicial foreclosure sale notices due to the fact the Countian had not been approved by a majority of judges of the Jefferson County Circuit Court as required by RSMo. § 493.027. The trial court granted the borrower’s motion for summary judgment and held that pursuant to RSMo. § 493.027, the Countian was required to obtain approval from a majority of the judges of the Circuit Court of Jefferson County, but failed to do so. In addition, the trial court denied the Countian’s motion for summary judgment that requested a ruling that approval by a majority of judges of the Jefferson Circuit Court was not required. Ultimately, the trial court found that the notice of the foreclosure sale was invalid due to the publication issue resulting in a void foreclosure sale and granted summary judgment in favor of the borrower.

The Court of Appeals analyzed the statutory construction of RSMo. § 493.027 in connection with RSMo. §§ 443.310 and 443.320 which are the statutory provisions regarding the requirements of the notices of Missouri non-judicial foreclosures. In addition, the Court of Appeals analyzed Chapter 493 of the Missouri Statutes, which governs legal publications, notices and advertisements. Specifically, section 493.027 RSMo. provides that “a board consisting of the judges of the circuit court” of any first classification county or the City of Saint Louis, “or a majority of them, if they deem it in the public interest, may qualify any newspaper of general circulation, and as further qualified in section 493.050, for the publication of public notices and advertisements, and may review and approve rates which may be charged for public notices and advertisements.”

Applying the rules of statutory construction and the plain language of the applicable statutes, the Court of Appeals determined that the use of the words “may” and “if they deem it in the public interest” as stated in RSMo. § 493.027 are discretionary with respect to the circuit court’s ability, in the event it chooses to oversee the qualification of newspapers. The Court of Appeals reasoned, “[t]he plain language of section 493.027 does not direct a newspaper to take any specific action to become qualified to publish notices and does not direct a circuit court to take any specific action regarding oversight of newspaper publications.” Further, the Court of Appeals stated that the use of the term “may” in RSMo. § 493.027 “allows a circuit court to establish procedures for newspapers seeking to be qualified, but does not require a newspaper to petition the court for approval in the absence of such procedures.” “The Circuit Court of Jefferson County had not established local rules or procedures pursuant to section 493.027 for qualifying newspapers to publish public notices.” Therefore, the Countian was qualified to publish foreclosure notices in Jefferson County without approval of a majority of Jefferson County Circuit Court judges.

The primary takeaways from this case are that a newspaper in Missouri that publishes foreclosure notices and is qualified under RSMo. § 493.050, does not have to obtain approval from a board consisting of a majority judges of the applicable circuit court so long as the circuit court has not already established local rules or procedures regarding the publication of notices of foreclosure sales; and that practitioners and servicers should carefully scrutinize the qualifications of publishers.

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October 2021 e-Update