Real Property, Financial Services & Title Insurance Case Law Update: Week Ending March 7, 2014

I. FLORIDA STATE CASES – SARA WITMEYER

  • Foreclosure/Standing: testimony of employee of current loan servicer failed to establish necessary foundation for admitting records of prior loan servicer into evidence under business records exception to hearsay rule; in absence of other evidence in record independently proving foreclosing servicer possessed promissory note as of date complaint filed, foreclosing servicer lacked standing – Hunter v. Aurora Loan Servs., LLC, No. 1D12-6071 (Fla. 1st DCA Mar. 4, 2014) (reversed)
  • Foreclosure/Protecting Tenants at Foreclosure Act: order authorizing writ of possession should have stated that it did not take effect until end of lease term of bona fide tenant residing in foreclosed property – Almonor v. JPMorgan Chase Bank, N.A., No. 3D12-2795 (Fla. 3d DCA Mar. 5, 2014) (reversed)
  • Assessments: pursuant to Fla. Stat. § 718.116, purchaser at foreclosure sale only jointly and severally liable for unpaid condominium assessments of immediate-prior owner, not unpaid assessments of original owner – Aventura Mgmt., LLC v. Spiaggia Ocean Condo. Ass’n, Inc., No. 3D13-1437 (Fla. 3d DCA Mar. 5, 2014) (reversed)
  • Foreclosure/Due Process: final judgment of foreclosure should have been set aside where borrower not served with notice of issue or order setting trial – Stevens v. Nationstar Mortg., LLC, No. 5D13-3472 (Fla. 5th DCA Mar. 7, 2014) (reversed)
  • Assessments: bank not entitled to judgment as matter of law limiting its liability for unpaid, past-due condominium assessments pursuant to Fla. Stat. § 718.116 because material fact issue remained whether bank took title through foreclosure as first mortgagee - Bermuda Dunes Private Residences v. Bank of America, No. 5D12-4218 (Fla. 5th DCA Mar. 7, 2014) (reversed)

II. 11TH CIRCUIT CASES – LAUREN SEMBLER

  • TILA: loan servicer could not enforce jury trial waiver contained in mortgage because it was not a party to the mortgage - Hamid v. Ocwen Loan Servicing, LLC, No. 0:13-cv-62821-WJZ (S.D. Fla. Feb. 26, 2014) (order denying loan servicer’s motion to strike jury trial demand)

III. TITLE INSURANCE CASES - CHRIS SMART

  • Recoupment: third party title insurer has only a limited cause of action against a professional liability insurer under New York law and that cause is not ripe until the statutory preconditions are met – Commonwealth Land Title Ins. Co. v. Am. Signature Servs., Inc., No. 13-cv-3266 (E.D.N.Y. Feb. 20, 2014) (order on motion to dismiss)
  • Attorney Discipline: two-year suspension for attorney who forged commitments and policies after his agency agreement was terminated deemed sufficient based on his holding the money in escrow, his stated intent to ultimately issue valid policies, and mitigating family circumstances – Mississippi Bar v. Derivaux, No. 2012-BA-01330 (Miss. Feb. 20, 2014) (affirming bar tribunal suspension)
  • Lender’s Policy: lender’s policy does not guaranty lender’s title, it merely provides for indemnity if actual loss results from a title defect – In re West Feliciana Acquisition, LLC, No. 13-30675 (5th Cir. Feb. 27, 2014) (affirming summary judgment)
  • Lender’s Policy: mere existence of title defect is not a breach of lender’s title insurance policy – In re West Feliciana Acquisition, LLC, No. 13-30675 (5th Cir. Feb. 27, 2014) (affirming summary judgment)

Topics:  Banks, Foreclosure, Mortgage Loan Servicing Standards, Mortgages, TILA, Title Insurance

Published In: Finance & Banking Updates, Insurance Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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