Reaffirming the Validity of Assigned Deeds of Trust and MERS Authority in Alaska Nonjudicial Foreclosures: Commentary on Clinton Hiler v. U.S. Bank

Court: Supreme Court of the State of Alaska (Memorandum Opinion and Judgment)
Decision Date: November 19, 2025
Case No.: S-19261

Important Note: This is a memorandum decision issued under Alaska Appellate Rule 214. As the court itself emphasizes, such decisions do not create binding precedent. They can sometimes be cited under limited circumstances specified in Rule 214(d), but they do not formally establish new law. This commentary therefore focuses on how the court applies and reinforces existing principles rather than on any creation of new doctrine.

I. Introduction

This case arises from a nonjudicial foreclosure on a VA-guaranteed residential loan in Willow, Alaska. The borrower, Clinton Hiler, defaulted on a loan originally made by National Bank of Kansas City (NBKC) and later assigned to U.S. Bank. After the foreclosure sale, Hiler sued to quiet title, alleging the foreclosure was fraudulent and asserting, at one point, a claim of ownership by adverse possession. The superior court granted summary judgment for U.S. Bank, and Hiler appealed.

On appeal, Hiler – representing himself (pro se) – advanced a series of challenges that are typical of contemporary foreclosure-defense litigation, including:

that he had not actually been loaned money, because he was not handed cash directly;
that the promissory note or deed of trust was invalid because the lender did not sign it;
that U.S. Bank lacked “standing” or authority to foreclose because it was not the original lender;
that MERS (Mortgage Electronic Registration Systems, Inc.), being a “machine,” could not lawfully act as beneficiary or assign the deed of trust; and
that U.S. Bank unlawfully increased his monthly payments.

The Alaska Supreme Court affirmed the superior court’s judgment. While the opinion is short and fact-specific, it is a useful illustration of several recurring themes:

the enforceability of residential loans even when funds are paid directly to a third party (such as the seller),
the validity of deeds of trust and notes that are not physically signed by the lender,
the authority of assignees, such as U.S. Bank, to foreclose when the loan and deed of trust have been validly assigned,
the continuing recognition in Alaska of MERS’s role as nominee and beneficiary, and
the strict demands of appellate procedure: issues not preserved below or not adequately briefed are typically treated as waived.

II. Factual and Procedural Background

A. The Loan and Security Instrument

In August 2019, Clinton Hiler entered into a loan agreement with National Bank of Kansas City (NBKC) to purchase real property in Willow, Alaska. The key features of the transaction were:

Loan amount: $128,000;
Loan type: VA-guaranteed loan (backed by the U.S. Department of Veterans Affairs);
Security: a deed of trust on the Willow property.

The deed of trust:

named Mat-Su Title Agency, LLC as trustee;
designated MERS as the beneficiary and nominee for NBKC; and
granted MERS (and thus the lender/beneficiary) the power of sale in the event of default.

The opinion reiterates a standard definition of a deed of trust: a device that transfers legal title from the property owner to a trustee for the benefit of a beneficiary, which at origination is normally the lender. The court cites secondary authority and previous Alaska case law confirming that, in Alaska, mortgages and deeds of trust are “virtually identical” in substance.

B. Assignment to U.S. Bank and Default

In September 2019, NBKC assigned the loan to U.S. Bank and notified Hiler of this assignment. Hiler was directed to make his monthly payments to U.S. Bank.

Hiler soon stopped making those payments. Later that December, MERS assigned the deed of trust itself to U.S. Bank, and that assignment was recorded in the public records. Thus, both the note (or loan) and the deed of trust (security) were transferred to U.S. Bank.

In April 2022, U.S. Bank notified Hiler of his default and its intention to foreclose nonjudicially. In August 2022, U.S. Bank conducted a foreclosure sale of the property, which was sold for $152,537.18.

C. The Superior Court Lawsuit

After the foreclosure sale, Hiler filed a complaint in the superior court (Palmer) seeking to quiet title in himself and to invalidate the foreclosure. His primary theories were:

Fraudulent foreclosure: he asserted that the foreclosure was fraudulent, in part because he contended there was no “real” underlying debt and also that the foreclosing bank was not the original lender; and
Adverse possession: he claimed title under a theory of adverse possession.

At some point after suit was filed, he was removed from the property via a writ of assistance (a court order sering to deliver possession to the purchaser following foreclosure).

U.S. Bank moved for summary judgment. It argued:

the adverse possession claim failed as a matter of law because Hiler had not possessed the property for the statutory period, nor had his possession been hostile to the true owner (indeed, he occupied as the record owner under a deed of trust); and
the foreclosure was not fraudulent: the bank had complied with statutory requirements for a nonjudicial foreclosure, and there was no factual dispute about the existence of the loan, the deed of trust, Hiler’s default, or proper notice.

Hiler opposed summary judgment. His core contentions were:

he signed a “draft,” not a “note,” implying that the primary loan document was somehow improper or non-enforceable; and
U.S. Bank lacked “standing” to foreclose because it was not the original lender.

The superior court granted summary judgment in favor of U.S. Bank and dismissed Hiler’s complaint with prejudice. It held:

Adverse possession: failed as a matter of law because Hiler did not occupy the property for the minimum statutory time period; and
Fraudulent foreclosure: failed because the undisputed evidence showed:
- Hiler signed a promissory note for a loan secured by a deed of trust on the property;
- he received adequate notice of his default;
- he did not cure that default; and
- the foreclosure complied with Alaska’s nonjudicial foreclosure framework.

The court denied Hiler’s motion for reconsideration, and final judgment was entered. Hiler appealed to the Alaska Supreme Court.

III. Summary of the Supreme Court’s Opinion

The Alaska Supreme Court affirmed the superior court’s grant of summary judgment.

Key points of the decision:

Existence of a valid debt: The court rejected Hiler’s argument that no debt existed because he was not directly handed money. Relying on its earlier decision in Hooks v. Alaska USA Federal Credit Union, the court held that a lender’s transfer of funds to a third party (e.g., the seller of the home) can constitute a valid loan.
Validity of the note and deed of trust: The argument that the note or deed of trust was invalid because the lender did not sign it was held meritless, again under Hooks. Alaska law does not require the lender’s signature for a deed of trust to be valid.
Authority of U.S. Bank to foreclose: NBKC validly assigned its rights under the loan and deed of trust to U.S. Bank. Because Hiler was notified of the assignment, U.S. Bank had full authority to enforce the note and foreclose when Hiler defaulted.
MERS’s role and authority: The court rejected Hiler’s contention that MERS, as a “machine,” could not act as beneficiary. Relying on Espeland v. OneWest Bank, FSB, it reaffirmed that MERS, as nominee and nominal beneficiary, has authority to act in ways the true beneficiary could, including assigning its beneficial interest to another party.
Alleged unlawful payment increase: Because Hiler failed to raise this argument in the superior court in opposition to summary judgment, the Supreme Court reviewed it only for “plain error” and found none. The note allowed for increased charges due to late payments or escrow changes, and Hiler’s default made it entirely possible – and lawful – that such charges were applied.
Other arguments waived: Vague references to land patents, securitization audits, threats of arrest, and a federal statute about loans secured by a bank’s own stock were deemed inadequately briefed and therefore waived. Even under the more lenient standards applied to self-represented litigants, the court could not discern coherent legal arguments from these references.

Because none of Hiler’s preserved arguments showed error, the court affirmed the superior court’s judgment in favor of U.S. Bank.

IV. Detailed Analysis

A. Precedents Cited and Their Role in the Decision

1. Hooks v. Alaska USA Federal Credit Union, 413 P.3d 1192 (Alaska 2018)

Hooks is central to this opinion. In Hooks, the borrower advanced arguments quite similar to those raised by Hiler, including:

that no valid loan existed because funds were transferred to a third party rather than handed to the borrower; and
that a deed of trust (and associated documents) was invalid because the lender’s agent did not sign them.

The Alaska Supreme Court in Hooks held that:

A lender can make a valid loan by paying the purchase price directly to a seller or other third party; the borrower’s obligation is enforceable so long as the arrangement is part of the agreed transaction.
Alaska’s statutes on conveyances and deeds of trust do not require the lender’s signature on a deed of trust for that instrument to be valid.

In Hiler, the court effectively re-applies these holdings:

It declares that Hiler’s “no money loaned” argument is “contrary to” Hooks, and emphasizes that the bank’s transfer of $128,000 to the seller, allowing Hiler to obtain the property, is a valid basis for an enforceable loan.
It dismisses Hiler’s contention that the note or deed of trust is invalid because the lender did not sign them, relying on the same reasoning from Hooks that no such requirement exists in Alaska law.

Thus, Hooks provides the backbone for the court’s rejection of Hiler’s attacks on the existence and enforceability of the underlying loan and security instrument.

2. Espeland v. OneWest Bank, FSB, 323 P.3d 2 (Alaska 2014)

Espeland addressed the legal status of MERS in Alaska deeds of trust. There, the Alaska Supreme Court recognized MERS as a nominal (or “nominee”) beneficiary and held that, in that role, MERS had authority to:

act as the beneficiary of a deed of trust for recording and foreclosure purposes; and
take actions such as assigning the deed of trust to another entity.

In Hiler, the court cites Espeland to dispose of Hiler’s argument that MERS could not be a beneficiary because it is a “machine.” The court reiterates that MERS, as a nominal holder of the beneficial interest, can take any action that the actual beneficiary could take, including assigning its interest to U.S. Bank. This reinforces MERS’s continuing institutional role in Alaska’s mortgage system.

3. Young v. Embley, 143 P.3d 936 (Alaska 2006)

Young v. Embley is cited in a footnote to support the proposition that, for most purposes relevant to this case, “mortgages and deeds of trust are virtually identical.” This reinforces the notion that Alaska treats both instruments similarly in analyzing foreclosure rights and remedies.

4. Newton v. Magill, 872 P.2d 1213 (Alaska 1994)

Although Hiler framed many of his appellate arguments as attacks on the superior court’s denial of his motion for reconsideration, the Supreme Court cites Newton to clarify that when an appeal from a denial of reconsideration effectively presents the merits of the underlying summary judgment order, the court may address those merits directly.

This citation is procedural: it allows the court to treat Hiler’s arguments as if he had appealed the substance of the summary judgment ruling, which simplifies the analysis.

5. Laughlin v. Laughlin, 229 P.3d 1002 (Alaska 2010) and In re Estate of Fields, 219 P.3d 995 (Alaska 2009)

These cases define the standard for “plain error,” which the court uses to assess Hiler’s late-raised argument about an unlawful increase in monthly payments. Under this standard, plain error exists only where:

an obvious mistake has been made which creates a high likelihood that injustice has resulted.

Applying this standard, the court finds no plain error because Hiler’s note expressly allowed for additional charges (for past-due amounts and escrow changes), and the record supports the possibility that any increase was a lawful consequence of his default.

6. Wright v. Anding, 390 P.3d 1162 (Alaska 2017)

Wright is cited to address the briefing standard for self-represented litigants. Although Alaska courts give pro se litigants some leeway, their briefs must be:

coherent enough for the court to discern the legal issue being raised, and
sufficiently developed (with facts and argument) to put the opposing party and the court on notice of the claim.

Based on Wright, the court holds that Hiler’s vague references to a land patent, securitization audit, and federal banking statute are too underdeveloped to merit review and are therefore treated as waived.

B. The Court’s Legal Reasoning

1. Existence and Validity of the Debt

Hiler’s first major argument was that he had never been “directly” loaned or given money by NBKC, suggesting that no enforceable debt existed and thus no foreclosure could properly occur.

The court’s reasoning proceeds in a straightforward manner:

Undisputed facts: Hiler obtained a VA-guaranteed loan for $128,000 from NBKC to buy his home, and the funds were used to acquire the property.
Legal principle (from Hooks): a loan is valid even if the lender’s funds are disbursed directly to a third party (such as the seller), rather than being physically handed to the borrower.
Application: NBKC’s payment of funds to the seller in exchange for Hiler receiving title to the property constitutes valid consideration and creates a binding loan obligation. There is no requirement that Hiler be physically given cash or a check to establish a loan.

Accordingly, the court holds that Hiler’s “no underlying debt” theory is without merit.

2. Validity of the Promissory Note and Deed of Trust

Hiler also argued that the promissory note was not negotiable and the deed of trust invalid because they were not signed by the lender. He characterized the document he signed as a “draft” instead of a “note,” implying that this distinction undermined enforceability.

The court again relies on Hooks:

Alaska’s statutes concerning conveyances of interests in land and deeds of trust do not require the lender’s signature on such documents for them to be valid.
The fact that the borrower, but not the lender, signed the deed of trust, is sufficient to bind the borrower and grant the security interest.

While the opinion does not detail the UCC distinctions between drafts and notes, it makes clear that, as a matter of Alaska law, the formal label of the instrument (e.g., “draft” vs. “note”), or the absence of the lender’s signature, does not defeat the enforceability of the borrower’s obligation when the transaction itself is otherwise valid and undisputed.

3. U.S. Bank’s Authority to Foreclose (“Standing”)

Hiler argued that U.S. Bank lacked “standing” to foreclose because NBKC was the original lender. The court addresses this through the law of assignments:

Deed of trust allowed assignment: The deed of trust explicitly authorized NBKC to assign its rights.
Assignments occurred: NBKC assigned the loan to U.S. Bank; MERS, as nominee/beneficiary, assigned the deed of trust to U.S. Bank; the latter assignment was recorded.
Notice to borrower: Hiler was notified of the assignment and instructed to make payments to U.S. Bank.

Under basic principles of contract and property law:

An assignee (here, U.S. Bank) steps into the shoes of the original lender (NBKC); and
Once assigned, the assignee acquires the right to enforce the note and the deed of trust, including exercising the power of sale on default.

Because Hiler defaulted on the loan and U.S. Bank held both the note and the deed of trust, the court concludes that U.S. Bank had full authority to initiate nonjudicial foreclosure. The use of “standing” language by Hiler is treated as a mislabeling of what is, in substance, a challenge to assignment and enforcement, not constitutional standing in the usual sense.

4. Legitimacy of MERS as Beneficiary and Assignor

Hiler’s argument that MERS cannot be the beneficiary of a deed of trust because it is a “machine” reflects a broader set of challenges that have been raised in courts nationwide about MERS’s role.

The court’s reasoning, grounded in Espeland, is straightforward:

The deed of trust validly nominated MERS as the beneficiary and nominee for NBKC.
Under Alaska law, MERS, as the nominal beneficiary, may take any action that the actual beneficiary (here, the lender) could take.
Such actions include assigning its beneficial interest to another party, like U.S. Bank.

Therefore, MERS’s assignment of the deed of trust to U.S. Bank was valid, and U.S. Bank properly became the beneficiary under the deed of trust. The characterization of MERS as a “machine” is legally irrelevant; the entity is recognized as a valid corporate actor and nominee in Alaska case law.

5. Alleged Unlawful Increase in Monthly Payments

Hiler argued on appeal that U.S. Bank “unlawfully changed” the amount of his monthly payment. However, he did not raise this issue in the superior court when opposing summary judgment. As a result:

There was no trial court ruling on this point to review; and
U.S. Bank had no opportunity below to counter this claim with evidence or argument.

The Supreme Court therefore reviewed the issue only for plain error, a standard reserved for clear, obvious mistakes resulting in a high likelihood of injustice. The court found:

Hiler’s promissory note explicitly allowed for:
- additional charges for past-due payments; and
- changes in escrow payments (e.g., adjustments for taxes and insurance).
Because Hiler failed to make his monthly payments, it was entirely possible that any increase he perceived was a lawful contractual adjustment.

Given this, the court found no “obvious mistake” in the superior court’s handling of the case and thus no plain error.

6. Waiver of Other Arguments Due to Inadequate Briefing

Hiler’s appellate brief also alluded to:

a “land patent,”
a “securitization audit,”
threats of arrest if he did not vacate the property, and
12 U.S.C. § 83(a), which prohibits national banks from making loans secured by their own capital stock.

However, he did not clearly explain how these topics related to the validity of the foreclosure or provide supporting facts.

Applying Wright v. Anding, the court held that even self-represented litigants must provide sufficiently clear and developed argumentation for the court to understand and evaluate the claim. Because it could not discern any coherent legal theory from these scattered references, the court treated those arguments as waived and declined to address them.

C. Impact and Practical Significance

1. Nonprecedential but Instructive

This memorandum opinion does not create binding precedent under Alaska Appellate Rule 214. However, it is still instructive in several ways:

It shows how the Alaska Supreme Court consistently applies Hooks and Espeland to reject common anti-foreclosure arguments.
It signals that challenges premised on pseudo-technical theories (e.g., “no money was lent,” MERS as a “machine,” or the lender’s missing signature) are unlikely to succeed.
It underscores the need to focus on concrete, fact-supported defenses (such as actual procedural irregularities, misapplied payments, or statutory violations) rather than theories divorced from the transaction’s reality.

2. Reaffirmation of MERS’s Role in Alaska

By once again endorsing Espeland’s recognition of MERS as a valid nominee and beneficiary, the court contributes to the continued stability of Alaska’s mortgage registration and assignment practices. Lenders and trustees can rely on MERS assignments with some confidence that courts will treat them as effective, provided they comply with statutory foreclosure requirements.

3. Guidance for Pro Se Litigants and Appellate Practice

The opinion also offers an implicit lesson for self-represented homeowners:

Courts will read pro se filings liberally, but they will not invent arguments that are not clearly made.
Arguments must be:
- raised in the trial court, or risk being subject to only plain-error review;
- tied to specific facts in the record; and
- supported by at least some legal reasoning or authority.

Unstructured references to complex concepts like “securitization audits” or “land patents,” without explanation of how they affect the particular foreclosure, will almost certainly be disregarded as waived.

4. Nonjudicial Foreclosures and Consumer Protection

From a broader policy perspective, the decision illustrates the balance Alaska courts maintain in the nonjudicial foreclosure context:

On one hand, the court rigorously applies established doctrine to uphold valid contractual obligations and property interests of lenders and assignees, especially where the borrower’s default is undisputed.
On the other hand, the court does not relax procedural standards to the point that undeveloped or legally unsound theories can overturn properly conducted foreclosures.

For future cases, the decision indicates that borrowers seeking to challenge nonjudicial foreclosures should focus on specific factual or statutory defects in the foreclosure process, not on broad attacks against the fundamental structure of modern mortgage finance (MERS, securitization, assignments) without legal support.

V. Clarifying Key Legal Concepts

A. Deeds of Trust vs. Mortgages

In Alaska, a deed of trust is a three-party instrument:

Trustor: the borrower/homeowner (here, Hiler);
Trustee: a neutral third party (Mat-Su Title Agency, LLC);
Beneficiary: the lender or its nominee (initially MERS as nominee for NBKC, then U.S. Bank).

The trustor conveys legal title to the trustee, to be held in trust for the beneficiary, as security for the loan. If the borrower defaults, the trustee (or the beneficiary through the trustee) may sell the property at a nonjudicial foreclosure sale under the power of sale granted in the deed of trust.

Alaska treats deeds of trust as functionally equivalent to mortgages in terms of foreclosure rights and obligations, as reaffirmed by Young v. Embley.

B. MERS (Mortgage Electronic Registration Systems, Inc.)

MERS is a private electronic registry system created by major mortgage industry participants to track servicing rights and ownership of mortgage loans. It often appears in deeds of trust as “beneficiary” and “nominee” for the lender.

Legally in Alaska:

MERS can be designated as the nominal beneficiary under a deed of trust;
MERS can act on behalf of the true lender (and later assignees) for purposes such as:
- assigning the deed of trust; and
- participating in the foreclosure process, depending on the instrument and applicable law.

In this case, MERS held the nominal beneficial interest and assigned it to U.S. Bank, a step the court treats as routine and valid.

C. Notes, Drafts, and Negotiable Instruments

Under the Uniform Commercial Code (UCC), which Alaska has adopted in relevant part:

A note is a promise by one party to pay money to another.
A draft (like a check) is an order by one party directing another party to pay money to a third.

Both can be negotiable instruments if they meet certain criteria. Hiler’s attempt to label what he signed as a “draft” rather than a “note” appears aimed at undermining enforceability. But the Supreme Court’s reasoning makes clear that:

what matters is the substance of the transaction – that he agreed to repay a loan used to purchase the property;
the lack of a lender’s signature does not invalidate the instrument under Alaska law; and
the instrument is treated as an enforceable promise by Hiler to pay, secured by the deed of trust.

D. Assignments and the Right to Foreclose

When a lender assigns a note and deed of trust to another entity:

the assignee steps into the shoes of the assignor and acquires all of the assignor’s rights;
if the note and deed of trust authorize the assignee to enforce them (as is typical), the assignee can:
- collect payments,
- declare a default, and
- foreclose under the deed of trust’s power of sale.

In Hiler, NBKC assigned the loan to U.S. Bank; MERS assigned the deed of trust to U.S. Bank. With both the debt and the security interest assigned, and notice provided to Hiler, U.S. Bank was fully authorized to commence foreclosure.

E. Nonjudicial Foreclosure in Alaska

Alaska allows creditors to foreclose deeds of trust nonjudicially, meaning without first obtaining a court judgment. Generally, the process involves:

default by the borrower under the note or deed of trust;
statutorily prescribed notices to the borrower and publication of sale;
a trustee’s sale of the property at public auction; and
issuance of a deed to the successful bidder.

Here, the court found that:

Hiler defaulted on his obligations;
U.S. Bank provided him with notice of default and intent to foreclose; and
the sale occurred and disposed of the property.

With these facts undisputed, and no successfully raised procedural defect, the nonjudicial foreclosure was held lawful.

F. Adverse Possession

Adverse possession is a doctrine allowing a person who occupies land openly, continuously, and hostilely for a statutory period (often a decade or more) to acquire legal title, even against the record owner.

While Hiler initially argued adverse possession in the superior court, he abandoned that argument on appeal, and the Supreme Court notes this explicitly. Even on the merits, adverse possession would be highly implausible here because:

Hiler originally occupied the property as the borrower and record owner under a deed of trust; his possession was not “hostile” but permissive;
He had not possessed the property for the required statutory period; and
He was ousted by a writ of assistance shortly after foreclosure.

The superior court correctly concluded that adverse possession failed as a matter of law.

G. Waiver and Plain Error in Appellate Practice

Waiver by inadequate briefing: An argument is waived on appeal if the appellant fails to:

clearly articulate the legal basis of the claim, and
tie it to specific facts and authorities.

Hiler’s vague references to land patents, securitization audits, and federal banking law, without explanation, were deemed waived.

Plain error: If a party fails to raise an issue in the trial court, an appellate court will review it, if at all, only for plain error – a very high standard requiring an obvious mistake and a high likelihood of resulting injustice. The court found no such error regarding the alleged payment increase, largely because the loan documents authorized the kind of charges that might explain the increase and the record did not suggest any manifest error.

VI. Conclusion

Clinton Hiler v. U.S. Bank is a nonprecedential memorandum decision, but it provides a clear application of Alaska’s existing foreclosure jurisprudence to a fact pattern that is increasingly common in residential lending disputes. The Supreme Court’s analysis underscores several key points:

A residential loan remains fully enforceable even when the funds go directly to a third party to facilitate a property purchase.
Deeds of trust and promissory notes do not become invalid simply because the lender or its agent did not sign them, so long as Alaska statutory requirements are met and the borrower’s obligations are clearly set out.
Assignees like U.S. Bank have full authority to enforce both the note and deed of trust when assignments are validly executed, recorded, and communicated to the borrower.
MERS continues to be recognized in Alaska as a lawful nominee and nominal beneficiary capable of assigning its interests in deeds of trust.
Appellants, even those representing themselves, must preserve their arguments in the trial court and present them in a coherent, adequately developed manner on appeal; otherwise, the arguments will be treated as waived or reviewed, at best, under the demanding plain-error standard.

In affirming the superior court’s summary judgment in favor of U.S. Bank, the Alaska Supreme Court sends a clear signal: challenges to foreclosure that rely on technical or pseudo-legal theories divorced from the realities of the transaction and the governing statutes will not succeed. To contest a nonjudicial foreclosure, borrowers must focus on concrete defects in the process or genuine disputes of fact, rather than broad attacks on the legitimacy of modern lending structures and assignment practices.