NATIONSTAR MORTGAGE LLC v. RICHARD ZEULI & Others.

NOTICE: Summary decisions issued by the Appeals Court pursuant to M.A.C. Rule
23.0, as appearing in 97 Mass. App. Ct. 1017 (2020) (formerly known as rule 1:28,
as amended by 73 Mass. App. Ct. 1001 [2009]), are primarily directed to the parties
and, therefore, may not fully address the facts of the case or the panel's
decisional rationale. Moreover, such decisions are not circulated to the entire
court and, therefore, represent only the views of the panel that decided the case.
A summary decision pursuant to rule 23.0 or rule 1:28 issued after February 25,
2008, may be cited for its persuasive value but, because of the limitations noted
above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260
n.4 (2008).

COMMONWEALTH OF MASSACHUSETTS

APPEALS COURT

24-P-496

NATIONSTAR MORTGAGE LLC 1

vs.

RICHARD ZEULI & others. 2

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

As framed by the express agreement of the parties, this

postforeclosure summary process case presented a straightforward

issue for resolution, which was "whether as a matter of law the

[defendant Brenda Zeuli] was entitled to [an] additional notice

of default as a result of a modification entered into by the

parties in 2016." Based upon the documents and papers

submitted, a Housing Court judge ruled that by regulation of the

United States Department of Housing and Urban Development (HUD),

the plaintiff Nationstar Mortgage LLC (Nationstar) was required

1 Doing business as Mr. Cooper.

2 Brenda Zeuli, formerly known as Brenda Macchi, and Mason
Zeuli.
to send an additional notice of default as a result of the

parties' 2016 loan modification, that no such notice had been

given, and accordingly that Nationstar's foreclosure should be

disregarded and that Nationstar was not entitled to possession.

On appeal Nationstar argues that the 2016 "Loan

Modification Agreement" (2016 LMA) that the parties signed did

not "reinstate" Zeuli's loan, and thus that no new notice of

default was required by the HUD regulation. The basis for this

argument is that the 2016 LMA was essentially "identical" to a

loan modification agreement the parties entered into in 2014

(2014 LMA), and that accordingly there was no "consideration"

for the 2016 LMA and it had no force or effect. On the agreed-

upon record before the judge, however, there was no error in the

judge's conclusion as to the legal issue presented to him. We

accordingly affirm.

Background. Richard Zeuli (Richard) and Brenda Zeuli

(Brenda) (together, the Zeulis) purchased the subject property

in Peabody in 2003, and jointly executed a promissory note and

mortgage. In 2011, Nationstar was appointed as the servicer for

the lender. The mortgage was assigned to Nationstar in January

of 2013.

Between 2003 and 2014, the Zeulis executed several loan

modifications. In May of 2014 the Zeulis divorced, and Richard

conveyed his interest in the property to Brenda by quitclaim

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deed. For most of 2014, the Zeulis were in arrears on their

loan.

In October of 2014, the parties entered into another loan

modification, the 2014 LMA, which increased the loan amount and

changed the monthly payment obligation, among other items.

Richard and Brenda signed this modification in November of 2014,

and Nationstar signed it in February of 2015. It is undisputed

that the 2014 LMA "reinstated" the loan within the meaning of

the relevant HUD regulations.

Following the 2014 LMA, the Zeulis again missed payments.

It is undisputed that in April of 2015, Nationstar sent notices

of default to Richard and Brenda. On May 13, 2015, Nationstar

sent both Richard and Brenda letters informing them of their

right to cure their delinquency, pursuant to G. L. c. 244,

§ 35A, as amended through St. 2010, c. 258, § 7 (effective Aug.

7, 2010); Nationstar also sent Richard a letter informing him of

his right to request a modified mortgage loan, pursuant to G. L.

c. 244, § 35B. In December of 2015, Nationstar initiated

foreclosure proceedings.

In November of 2016, while the foreclosure was pending,

Brenda and Nationstar (but not Richard) signed another loan

modification, the 2016 LMA at issue here. While much of the

language in the 2016 LMA is identical to the 2014 LMA, there are

differences between them. In addition to the absence of Richard

3
as a signatory, the 2016 LMA contains two new paragraphs: new

paragraph 8 states that Brenda will remain liable for her

attorney's fees in any action arising out of or relating to the

2016 LMA, while paragraph 9 states Brenda's "understand[ing]"

that certain mortgage insurance provisions may change.

Although the Zeulis remained in default after the signing

of the 2016 LMA, Nationstar did not send the Zeulis a new notice

of default. In November of 2019, Nationstar completed the

foreclosure sale, at which Nationstar was the highest bidder.

Nationstar recorded the foreclosure deed, the Zeulis did not

vacate the property, and in February of 2020 Nationstar

commenced a summary process action against the Zeulis in the

Housing Court. Brenda filed an answer and asserted numerous

affirmative defenses and counterclaims, as to which the judge

granted summary judgment against Brenda on all but one.

The one defense that remained was Brenda's argument that

Nationstar failed to comply with HUD regulations regarding the

provision of notices of default. The parties subsequently

agreed to submit this remaining issue, namely, "whether as a

matter of law the Defendant was entitled to additional notice of

default as a result of a modification entered into by the

parties in 2016," to the judge to be decided on the papers the

parties submitted. By agreement, there would be no testimony.

4
The judge ruled that the 2016 LMA constituted a new

contract between Nationstar and the Zeulis, which created new

obligations for Brenda (and discharged Richard's obligations).

Accordingly, the judge found that the 2016 LMA "reinstated the

loan." The judge then ruled that under the relevant HUD

regulations, "Plaintiff was required to send a new default

notice to Defendant Brenda Zeuli after November 27, 2016.

Because Plaintiff did not comply with this regulatory

requirement, the foreclosure did not comply with the terms of

the Mortgage." As a result, judgment for possession entered for

the defendants. Nationstar filed several postjudgment motions,

which were denied except for Nationstar's motion for

clarification; the judge clarified that the effect of the 2016

LMA "was to remove the former owner Richard Zeuli from the loan,

as the modified mortgage superseded and replaced the terms of

any prior mortgages, including the identities and number of

obligors under the loan contract." This appeal followed.

Discussion. Nationstar argues that it received no

consideration for the 2016 LMA, and thus that the 2016 LMA did

not reinstate the loan and no new notice of default was

required. The judge ruled, to the contrary, that the 2016 LMA

"reinstated" the loan. We agree that the 2016 LMA was not

identical to the 2014 LMA, and that the differences were

material. New paragraph 8 of the 2016 LMA contains a concession

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by Brenda that she will not seek to recover her attorney's fees

"[i]n the event of any action(s) arising out of or relating to

this Agreement." New paragraph 9 documented certain

"understand[ings]" of Brenda as to how her mortgage insurance

premiums might change. Consideration is defined as "either a

benefit to the promisor or a detriment to the promisee." Miller

v. Cotter, 448 Mass. 671, 684 n.16 (2007), quoting Marine

Contrs. Co. v. Hurley, 365 Mass. 280, 286 (1974). "It is

sufficient if the consideration be of some value, though slight,

or of a nature which may enure to the benefit of the party

making the promise." Sewall-Marshal Condominium Ass'n v. 131

Sewall Ave. Condominium Ass'n, 89 Mass. App. Ct. 130, 134

(2016), quoting Newhall v. Paige, 76 Mass. 366, 368 (1858). The

above changes in the 2016 LMA are substantive; although they may

be of "slight" value, they meet the definition of

"consideration" sufficient to support a contract. We therefore

reject Nationstar's arguments that the new paragraphs can simply

be ignored, as nonmaterial. 3

3 As noted, the parties agreed to present this case as
involving only an issue of law. Nationstar provided no evidence
as to the purpose of the 2016 LMA or the new paragraphs added to
the 2016 LMA, nor could it without altering the nature of the
question presented.

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We accordingly disagree with the legal argument that

Nationstar advanced below. 4 Although on appeal Nationstar seems

also to advance a factual argument that even if the 2016 LMA was

valid, Nationstar did not in fact "reinstate" the Zeulis' loan

on its books, that argument was not made in the trial court and

indeed, is contrary to the parties' agreement that the remaining

issue for the court could be decided as a matter of law. The

argument is accordingly waived. See Carey v. New England Organ

Bank, 446 Mass. 270, 285 (2006), quoting Century Fire & Marine

Ins. Corp. v. Bank of New England-Bristol County, N.A., 405

Mass. 420, 421 n.2 (1989) ("An issue not raised or argued below

may not be argued for the first time on appeal"). We also

express no opinion on whether in another case the signing of a

document described as a "loan modification agreement"

necessarily "reinstate[s]" a loan for purposes of requiring a

new notice of default under HUD regulation 24 C.F.R. § 203.602

4 Nationstar argues on appeal that the judge erred in
stating that the 2016 LMA discharged Richard's obligations under
the note. We agree. The note was a separate instrument, and
the 2016 LMA specifically states that "[n]othing in this
Agreement shall be understood or construed to be a satisfaction
or release in whole or in part of the Note and Security
Instrument. Except as otherwise specifically provided in this
Agreement, the Note and Security Instrument will remain
unchanged." This error does not affect our conclusion, however,
that the 2016 LMA was supported by consideration -- namely, the
additional paragraphs in the LMA. We may affirm on any ground
supported by the record. Lopes v. Commonwealth, 442 Mass. 170,
181 (2004), quoting Gabbidon v. King, 414 Mass. 685, 686 (1993).

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(2025); 5 Nationstar did not advance an alternative argument that

the 2016 LMA, even if supported by valid consideration,

nevertheless did not "reinstate" the loan for purposes of the

HUD regulation, and accordingly that issue is not before us. 6

Judgment affirmed.

By the Court (Desmond,
Ditkoff & Englander, JJ. 7),

Clerk

Entered: July 2, 2025.

5 24 C.F.R. § 203.602 states

"The mortgagee shall give notice to each mortgagor in
default on a form supplied by the Secretary or, if the
mortgagee wishes to use its own form, on a form approved by
the Secretary, no later than the end of the second month of
any delinquency in payments under the mortgage. If an
account is reinstated and again becomes delinquent, the
delinquency notice shall be sent to the mortgagor again,
except that the mortgagee is not required to send a second
delinquency notice to the same mortgagor more often than
once each six months. The mortgagee may issue additional
or more frequent notices of delinquency at its option."
(Emphasis added).

Neither the parties nor the judge addressed the meaning of the
world "reinstate[]" in the regulation.

6 Nationstar has not provided us with its briefing below.
In any event, Nationstar has presented the issue on appeal as "a
basic question of contract law -- whether the November 2016
Document was a re-execution of the October 2014 Agreement or
rather a separate agreement of independent legal significance
supported by new consideration."

7 The panelists are listed in order of seniority.

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