          United States Court of Appeals
                     For the First Circuit

No. 14-2115

                    IN RE: ALVARO M. PEREIRA,

                             Debtor.

                       ___________________

                     BANK OF AMERICA, N.A.,

                            Appellee,

                               v.

    DEBORA A. CASEY, Chapter 7 Trustee for Alvaro M. Pereira,

                           Appellant.



          APPEAL FROM THE UNITED STATES DISTRICT COURT
                FOR THE DISTRICT OF MASSACHUSETTS

       [Hon. George A. O'Toole, Jr., U.S. District Judge]



                             Before

                       Howard, Chief Judge,
               Lynch and Thompson, Circuit Judges.



     Adam C. Ponte, with whom Mark S. Foss and Fletcher Tilton PC
were on brief, for appellant.
     Mark B. Johnson, with whom Kathleen M. Heyer and Johnson &
Borenstein, LLC were on brief, for appellee.
June 26, 2015
          LYNCH, Circuit Judge.         The outcome of this federal

bankruptcy case turns on interpretations of two different state

statutes, each of which concerns defects in real estate titles.

In time, those interpretations may affect considerable numbers of

Massachusetts   foreclosure   proceedings.     In   this   case,   those

interpretations affect who will benefit from the estate's real

property assets: a bank, or the debtor's other creditors as

represented by a bankruptcy trustee. For the reasons stated below,

we decide to certify two questions to the Supreme Judicial Court

(SJC) of Massachusetts.

          Debora Casey, a Chapter 7 bankruptcy trustee, filed this

action to avoid a mortgage held by Bank of America.          11 U.S.C.

§ 544(a)(3).    The parties both assume that the 2005 mortgage

contains a material defect: the certificate of acknowledgement

does not include the names of the mortgagors.        See Mortg. Elec.

Registration Sys., Inc. v. Agin (In re Giroux), No. 09-CV-10988-

PBS, 2009 WL 3834002, at *2 (D. Mass. Nov. 17, 2009) (applying

Massachusetts law to conclude that the omission of the mortgagor's

name in the certificate of acknowledgment rendered the mortgage

materially defective). After the mortgage was recorded, the notary

on the mortgage, presumably at the behest of the bank, executed an

affidavit under Mass. Gen. Laws ch. 183, § 5B, later recorded,

attesting that the debtors had signed the mortgage personally and


                                - 3 -
voluntarily.       The debtors went into bankruptcy later that year, in

2012.

             The    legal        issues     presented     are    whether,       under

Massachusetts state law, that § 5B affidavit can cure the defective

acknowledgement, or otherwise provide constructive notice to a

bona fide purchaser.        If not, the bankruptcy trustee can avoid the

mortgage under 11 U.S.C. § 544(a)(3).

             The state law questions in this case are dispositive,

and they are unresolved by the Massachusetts SJC.                           They also

implicate     "significant         policy      concerns    better      suited       for

resolution    by    the"    SJC.      Easthampton       Sav.    Bank   v.    City   of

Springfield, 736 F.3d 46, 48 (1st Cir. 2013).                     Accordingly, we

certify the questions for resolution by that court.                         See Mass.

S.J.C. R. 1:03.



                                          I.

             On December 27, 2005, Alvaro and Lisa Pereira refinanced

their   property     in    New    Bedford,     Massachusetts,     by   granting      a

mortgage to Bank of America in the principal amount of $240,000.

The Pereiras executed the mortgage document, initialing each page.

The document's certificate of acknowledgement, which affirms that

the mortgagors actually executed the documents for the mortgage

"voluntarily for its stated purpose," omitted their names.                       That

document was recorded the next day.
                              - 4 -
              On January 19, 2012, the attorney who notarized the

mortgage documents recorded an affidavit purportedly executed

pursuant to Mass. Gen. Laws ch. 183, § 5B.              That statute permits

recording of affidavits that "will be of benefit and assistance in

clarifying    the    chain   of   title"   to   certain    land.      Id.   The

affidavit, dated January 11, 2012, states that the attorney had

witnessed the Pereiras' signatures to the mortgage, and that they

signed it voluntarily.        The attorney stated that his omission of

the Pereiras' names from the certificate of acknowledgement was

"inadverten[t]."

             Alvaro Pereira filed for Chapter 7 bankruptcy on July

10, 2012.      On September 12, the bankruptcy trustee filed the

complaint in this case, seeking to avoid the mortgage for the

benefit of the bankruptcy estate pursuant to the "strong-arm

provision"    of    11   U.S.C.   §   544(a).    That     provision   allows   a

bankruptcy trustee to preserve the value of a mortgage for the

benefit of the bankruptcy estate if the mortgagee failed to perfect

its claim against a bona fide purchaser.            11 U.S.C. § 544(a)(3).

If the mortgage is voidable by a bona fide purchaser, the trustee

may preserve the avoided mortgage for the benefit of the bankruptcy

estate.   Id. §§ 544(a), 551; see also DeGiacomo v. Traverse (In re

Traverse), 753 F.3d 19, 27-28 (1st Cir. 2014).

             Bank of America moved for summary judgment in bankruptcy

court on April 16, 2013, and the Trustee filed an opposition and
                             - 5 -
cross-motion for summary judgment on May 31.1        The bankruptcy court

found in favor of the Trustee on June 21, 2013.            In its view, the

mortgage was defective, the defect had not been cured, and so the

Trustee could avoid the mortgage.         Though the court believed such

a defect is curable, the court was not convinced that the bank

"can just file [an] attorney's affidavit which solves the problem

of a defective acknowledgement."          It pointed out that there was a

statute, Mass. Gen. Laws ch. 184, § 24, which it read to explicitly

provide a procedure for curing defects in title, including a

defective     certificate   of   acknowledgement,    and    that   statutory

procedure had not been used.

             On September 26, 2014, the district court reversed. Bank

of Am., N.A. v. Casey, 517 B.R. 1 (D. Mass. 2014).            It held that

the affidavit was properly filed under Mass. Gen. Laws ch. 183, §

5B.   Id. at 3.      In its view, the affidavit "performed all the

necessary functions of a proper acknowledgement" and cured the

defective mortgage.     See id. at 5.      This appeal followed.



                                    II.

             The SJC permits a federal court to certify questions of

state law that are "determinative of the cause then pending in the

certifying court" but for which there is no controlling precedent


      1   The debtor is not participating in this case.
                                   - 6 -
by the SJC. Easthampton Sav. Bank, 736 F.3d at 50 (quoting Mass.

S.J.C. R. 1:03); see also, e.g., Ins. Co. of Pa. v. Great N. Ins.

Co., ___ F.3d ___, 2015 WL 3440342, at *1 (1st Cir. May 29, 2015);

Bos. Gas Co. v. Century Indem. Co., 529 F.3d 8, 23-24 (1st Cir.

2008).   Such is the case here.2

A. Determinative Questions of State Law

             Though it is an open question of Massachusetts law, Bank

of America does not argue that the defective mortgage document,

standing alone, was enough to prevent the Trustee from avoiding

the mortgage.      Casey, 517 B.R. at 3; see In re Giroux, 2009 WL

3834002, at *2.     Rather, the bank makes two arguments in reliance

on the § 5B attorney affidavit: that the affidavit cured the defect

in the mortgage, and that, in any event, the affidavit provided

"constructive notice" as good against a bona fide purchaser, and

so as good against the Trustee.    Under 11 U.S.C. § 544, the Trustee

may avoid mortgages voidable by "a bona fide purchaser of real

property."     Id. § 544(a)(3).   Each of these arguments presents a

question of Massachusetts law.3


     2 At oral argument, the parties agreed to the court's proposal
of certification. See Easthampton Sav. Bank, 736 F.3d at 50 n.4.
We subsequently afforded them an opportunity to propose language
for the certification questions.
     3 The bona fide purchaser provision "is generally dependent
on the substantive law of the state governing the property in
question." Bankruptcy Law Manual § 9A:7 (5th ed. 2015); see Soto-
Rios v. Banco Popular de P.R., 662 F.3d 112, 116 (1st Cir. 2011)
("[T]he bankruptcy trustee is vested with the status of a
                              - 7 -
          First, the bank argues that the affidavit was within the

authority of a state statute to cure the defect in the mortgage.

Section 5B of chapter 183 of the Massachusetts General Laws

provides the following:

          Subject to section 15 of chapter 184, an
          affidavit made by a person claiming to have
          personal knowledge of the facts therein stated
          and containing a certificate by an attorney at
          law that the facts stated in the affidavit are
          relevant to the title to certain land and will
          be of benefit and assistance in clarifying the
          chain of title may be filed for record and
          shall be recorded in the registry of deeds
          where the land or any part thereof lies.

          The parties agree that the affidavit satisfies most of

§ 5B's requirements, but they disagree over whether it "will be of

benefit and assistance in clarifying the chain of title."     The

district court concluded that "[w]ith the filing of the new

affidavit, all things necessary required for proper recording were

in place . . . ." Casey, 517 B.R. at 5.




hypothetical bona fide purchaser of real property, and may
ordinarily avoid any transfer of the property or obligation of the
debtor to the extent allowed under state law."); see also, e.g.,
Crane v. Richardson (In re Crane), 742 F.3d 702, 706 (7th Cir.
2013); Argent Mortg. Co. v. Drown (In re Bunn), 578 F.3d 487, 488-
89 & n.1 (6th Cir. 2009); Hamilton v. Wash. Mut. Bank FA (In re
Colon), 563 F.3d 1171, 1174 (10th Cir. 2009). Accordingly, whether
a subsequent purchaser would have constructive notice of the
Pereiras' mortgage, such that it would be good against the
purchaser and is good against the Trustee, is an issue of
Massachusetts law. The parties do not argue to the contrary.
                              - 8 -
                 The Trustee argues that a ch. 183, § 5B, affidavit cannot

cure the defect for two reasons.              First, she argues that because

the underlying mortgage document is defective, there is no transfer

of title to be "clarified" by an affidavit within the meaning of

the statute.         Cf. Eaton v. Fed. Nat'l Mortg. Ass'n, 969 N.E.2d

1118, 1133 n.28 (Mass. 2012) (suggesting that a mortgage holder

could use a § 5B affidavit to prove its authority to conduct a

foreclosure sale by showing "that it either held the note or acted

on behalf of the note holder at the time" of sale).              To the extent

a   §       5B   affidavit   is   available     to   "cure"   defects   through

"clarification," she also argues that the "clarify" language means

that § 5B affidavits are only available to cure de minimus defects

like scrivener's errors, not material ones.

                 Second, the Trustee reads a different statute, Mass.

Gen. Laws ch. 184, § 24, to provide two methods for curing a

defective acknowledgement in an instrument conveying an interest

in land: (a) after "ten years elapses after the instrument is

accepted for record," or (b) if "a proceeding is commenced on

account of the defect . . . and notice thereof is duly recorded."

Since the Trustee reads § 24 to explicitly provide a means to

resolve a situation like this one, she argues that it must be the

sole means of doing so, and that a § 5B affidavit is inadequate.4


        4
       We are aware of no Massachusetts law on point deciding
whether the latter clause of § 24 is better read to provide a
                             - 9 -
             The bank replies that § 5B affidavits can cure both

substantive and technical defects in the mortgage note, and that

its use in this case cannot be distinguished from Eaton.     The bank

also argues that § 24 is simply a statute of repose, not "the

prescription of a method for curing defects in instruments of

title."   Casey, 517 B.R. at 4 (agreeing with that argument).

             Determining whether a § 5B affidavit can cure a defective

mortgage acknowledgement is an issue of state law that turns on

the interpretation of two state statutes, § 5B and § 24.

             The bank's alternative argument is that the affidavit

makes the Trustee chargeable with constructive notice of the

mortgage.5    In general, "constructive notice is a positive rule of

state law that permits the prior purchaser to gain priority over

a latter purchaser, regardless of whether the latter purchaser

really knows of the prior purchase."       Stern v. Cont'l Assurance

Co. (In re Ryan), 851 F.2d 502, 506 (1st Cir. 1988) (emphasis

deleted).




remedy to cure any defect, or to state that a defective instrument
is not made effective by the ten-year period of repose if a
proceeding to escape the obligation was initiated before the
passage of ten years.
     5 Bank of America does not argue that the Trustee is bound by
the mortgage because it had actual knowledge of the mortgage. See
11 U.S.C. § 544(a) (explaining that the trustee may avoid certain
transfers of property and obligations "without regard to any
knowledge of the trustee or of any creditor").
                                 - 10 -
            Anyone purchasing the New Bedford property would have

discovered the affidavit and mortgage, the bank argues, thereby

receiving notice of the mortgagee's claim.           The affidavit itself

identifies the parties, the amount of the loan, and the address of

the property.      The district court agreed, observing that the

affidavit "performed all the necessary functions of a proper

acknowledgement"    under     Massachusetts   law:    it   identified   the

mortgage     and   affirmed     that   the    Pereiras      executed    the

acknowledgement voluntarily.      Casey, 517 B.R. at 5.

            On appeal, the Trustee argues that the affidavit cannot

provide constructive notice because it is outside the chain of

title.     The defective mortgage alone cannot provide constructive

notice, because it cannot be legally recorded. See Allen v. Allen,

16 N.E.3d 1078, 1084-85 (Mass. App. Ct. 2014) (citing Graves v.

Graves, 72 Mass. 391, 392-93 (1856)).          If a defective mortgage

cannot provide constructive notice of itself, the Trustee argues,

an affidavit that merely references a defective mortgage cannot

provide constructive notice.       See In re Ryan, 851 F.2d at 511-12

(holding that a properly recorded mortgage assignment could not

cure a defectively recorded mortgage because it was not within the

chain of title, and so could not provide constructive notice of

either); Mbazira v. Ocwen Loan Servicing, LLC (In re Mbazira), 518

B.R. 11, 22-23 (Bankr. D. Mass. 2014) (holding that a certificate


                                  - 11 -
of title noting a mortgage cannot provide constructive notice of

the mortgage).

            The outcome of these two state law arguments will control

the case.    If a § 5B affidavit can cure a defect in a mortgage's

certificate of acknowledgement, or if it can provide constructive

notice to a subsequent purchaser, the Trustee cannot avoid the

mortgage under her 11 U.S.C. § 544(a)(3) strong-arm powers.       If

the affidavit is not able to perform either of those functions,

the Trustee can avoid the mortgage.

B. Controlling SJC Precedent and Other Considerations

            The parties have not suggested that Massachusetts courts

have given reasonably clear guidance -- much less determinative

precedent -- on how we should resolve these questions.       Most of

the cases the parties cite to us are decisions of federal courts.

            In considering whether we should nonetheless "make[e] an

'informed prophecy'" rather than certify the question to the SJC,

we are mindful of the risks of an erroneous decision.    Ins. Co. of

Pa., 2015 WL 3440342, at *5 (quoting Showtime Entm't, LLC v. Town

of Mendon, 769 F.3d 61, 79 (1st Cit. 2014)).       "[T]he outcome of

this case has the potential to impact thousands of outstanding and

future mortgages . . . ."    Easthampton Sav. Bank, 736 F.3d at 52;

see id. (weighing "the dollar amounts involved, the likely effects

of a decision on future cases, and federalism interests" in

deciding whether to certify questions).
                              - 12 -
             As the bankruptcy court observed, "[t]he latest bunch of

cases that we have with defective acknowledgements are increasing

in number.    From what I've seen on my docket, there's lots more of

them yet to come."     This case does not implicate only situations

in which a § 5B affidavit has already been recorded to cure a

defective acknowledgement, but also situations going forward.

Further, if § 5B affidavits can cure the sort of material defect

at issue here, future mortgagees may argue that § 5B affidavits

can cure other material defects.

             If that outcome were clearly correct under Massachusetts

law and policy, we might nonetheless decide the case.       But this

case is not one "in which the policy arguments line up solely

behind one solution."       Easthampton Sav. Bank, 736 F.3d at 52

(quoting Ropes & Gray LLP v. Jalbert (In re Engage, Inc.), 544

F.3d 50, 57 (1st Cir. 2008)) (internal quotation mark omitted).

On the one hand, as the district court reasoned, the Trustee's

position requires agreeing that "a correcting § 5B affidavit

recorded fifteen minutes after the Pereiras had left the registry

would be ineffective to cure the defect that existed here. There

would be no useful purpose served by such a rule."        Casey, 517

B.R. at 5.    On the other hand, as the Trustee observes, the bank's

position allows the mortgagee to materially alter the mortgage by

modifying the certificate of acknowledgement without the assent of

the mortgagor.    Functionally, it is no different than allowing the
                                - 13 -
notary to correct the acknowledgement and re-record the mortgage

without the mortgagors' assent, a practice generally rejected.

See Logan v. WMC Mortg. Corp. (In re Gray), 410 B.R. 270, 277

(Bankr. S.D. Ohio 2009) ("[T]he vast majority of courts considering

the issue . . . have held that an attempt by a notary public or

other     public      official      to       correct          a     certification      of

acknowledgement after the document on which it appears has been

recorded is void absent re-acknowledgment by the grantor.").

             "Given the competing considerations implicated by this

question    of     state   law   and   policy,"         the       significance   of   the

question, its determinative role in this case, and the lack of

clear guidance from the SJC, certification is the appropriate

course.     Ins. Co. of Pa., 2015 WL 3440342, at *1.



                                         III.

             For    the    above   reasons,        we     certify       the   following

questions    of     Massachusetts      law    to   the        Massachusetts      Supreme

Judicial Court:

             1. May an affidavit executed and recorded
             pursuant to Mass. Gen. Laws. ch. 183, § 5B,
             attesting to the proper acknowledgement of a
             recorded mortgage containing a Certificate of
             Acknowledgement that omits the name of the
             mortgagor, correct what the parties say is a
             material   defect  in   the  Certificate   of
             Acknowledgement of that mortgage?

             2. May an affidavit executed and recorded
             pursuant to Mass. Gen. Laws. ch. 183, § 5B,
                                - 14 -
          attesting to the proper acknowledgement of a
          recorded mortgage containing a Certificate of
          Acknowledgement that omits the name of the
          mortgagor, provide constructive notice of the
          existence of the mortgage to a bona fide
          purchaser,   either   independently   or   in
          combination with the mortgage?

          "We would also welcome any additional observations about

relevant Massachusetts law that the [SJC] may wish to offer."   See

Bos. Gas Co., 529 F.3d at 24; see also In re Giroux, 2009 WL

3834002, at *2.   The Clerk of this court is directed to forward to

the SJC, under the official seal of this court, a copy of the

certified questions and our opinion in this case, along with copies

of the parties' briefs and appendix, and any supplemental filings

under Rule 28(j) of the Federal Rules of Appellate Procedure.   We

retain jurisdiction over this appeal pending resolution of the

certified questions.

          So ordered.




                              - 15 -
