Although the key issue in Ace Securities Corp., Home Equity Loan Trust, Series 2006-SL2 v. Deutsche Bank Securities Products, 650980/2012, was relatively straightforward – when does New York’s six-year statute of limitations begin to run in RMBS breach of contract actions? – the panel’s questions revealed some level of unease with the broader implications present on both sides of the case.
Chief among those is the presumed capability of HSBC Bank, as the plaintiff trustee, to sue defendant Deutsche Bank for breach of a defective mortgage loan’s representations and warranties within the entire life of the loan—even if it’s as long as 30 years—under the plaintiff’s interpretation of the contract.
