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Beth H. Mitchell, co-chair of the firm's Commercial Finance practice group, was quoted by Massachusetts Lawyers Weekly in “Foreclosure ordinances preempted by state law” on January 15. The article discusses the recent Supreme Judicial Court (SJC) decision in Easthampton Savings Bank, et al. v. City of Springfield. The SJC ruled that two local ordinances approved by the city of Springfield, Massachusetts, to combat urban blight caused by foreclosures, are preempted by state law. In a unanimous decision, the SJC mostly sided with the plaintiffs, six local banks that took issue with the two ordinances: a “mediation ordinance” that required mandatory mediation between mortgagors and mortgagees, and a “foreclosure ordinance” that required the owners of vacant buildings or those undergoing foreclosure to register with the city, pay a fee, post a surety bond and meet minimum requirements of maintenance. The SJC found that mortgage foreclosure regulation traditionally has been a matter of state and not local concern.

Beth notes that she wishes the SJC had provided clearer guidance on when local rules will be preempted or upheld. “It’s always useful to be able to predict in the business world,” said Beth. “The last thing that commercial entities like is uncertainty.” Beth points out that while the banks prevailed in the case, other private entities that oppose local ordinances and believe them to be preempted by state law may not have the appetite for a years-long court battle to prove it.