REAL PROPERTY UPDATE

• Commercial Landlord Duty: commercial landlord has no common law duty to provide automatic external defibrillator in its stores for use in medical emergency – Verdugo v. Target Corp., No. 10-57008 (9th Cir. October 28, 2014) (affirming district court’s dismissal after California Supreme Court answered question certified by the panel)
• Homestead Property/Charging Lien: order granting attorney’s charging lien on all property awarded client in divorce unenforceable against homestead property – Felice v. Sutherland Pullen Law, PLLC, No. 2D13-5958 (Fla. 2d DCA Oct. 24, 2014) (reversing order granting motion for charging lien)
• Foreclosure/Summary Judgment: summary judgment in favor of foreclosing plaintiff should not have been entered where plaintiff failed to establish absence of genuine issue of material fact and did not refute affirmative defense as to satisfaction of condition precedent and failure to comply with notice of default and right to cure obligations prior to foreclosing and accelerating debt – Harper v. HSBC Bank USA, N.A., No. 1D13-3403 (Fla. 1st DCA Oct. 23, 2014) (reversing order granting final summary judgment)
• Foreclosure/Trial Continuance: court’s proceeding to trial on scheduled date, even though fewer than twenty days had passed “after service of the last pleading,” did not deprive plaintiff of due process, was not abuse of discretion, and did not warrant reversal – HSBC Bank USA, N.A. v. Serban, No. 1D14-0022 (Fla. 1st DCA Oct. 23, 2014) (affirming order of dismissal without prejudice)
• Foreclosure/Dismissal: court’s dismissal of action without prejudice pursuant to Florida of Civil Procedure 1.420(b) was not abuse of discretion in light of fact that case had been pending for more than five years and court had found no circumstances showing that plaintiff’s failure to produce witness for trial resulted from events beyond its control – HSBC Bank USA, N.A. v. Serban, No. 1D14-0022 (Fla. 1st DCA Oct. 23, 2014 ) (affirming order of dismissal without prejudice)
• Standing/Summary Judgment: plaintiff that failed to establish standing to enforce contract at time it filed complaint and attached incorrect agreement to complaint not entitled to summary judgment – Miteva v American Express Bank, FSB, No. 3D13-2093 (Fla. 3d DCA Nov. 5, 2014) (reversed and remanded with leave to amend complaint).
• Specific Performance: purchaser entitled to seek specific performance against seller for breach of real estate purchase contract where default provision in contract did not limit remedies available to purchaser upon breach – Regents Park Investments, LLC v  KAI Properties, Ltd., No. 3D13-1511 (Fla. 3d DCA Nov. 5, 2014) (reversed and remanded).
• Business Records Exception: current note holder required to authenticate prior note holder’s payment history under section 90.803(6)(a), Fla. Stat., in order to qualify documents as business records at trial.  Authentication can be accomplished by producing a certification by prior note holder in accordance with section 90.902(11), Fla. Stat., and/or testimony that current note holder has procedures in place to check accuracy of information received from prior note holder – Holt v Calchas, LLC, No. 4D13-2101 (Fla. 4th DCA Nov. 5, 2014) (affirmed in part, reversed and remanded).
• Foreclosure/Conditions Precedent: paragraph twenty-two of mortgage concerns acceleration, does not affect bank’s entitlement to foreclose on past due installments and, therefore, cannot support dismissal of foreclosure action – Holt v Calchas, LLC, No. 4D13-2101 (Fla. 4th DCA Nov. 5, 2014) (affirmed in part, reversed and remanded).
• Attorneys’ Fees: award of attorneys’ fees requires testimony from independent expert witness establishing reasonableness of fees – Miller v The Bank of New York Mellon, No. 4D13-3576 (Fla. 4th DCA Nov. 5, 2014) (affirmed in part, reversed in part, and remanded).
• Foreclosure/Standing: plaintiff lacked standing to enforce note specially indorsed in favor of non-party payee where note not indorsed by non-party payee in possession of the note in favor of plaintiff as required by Fla. Stat. § 673.2051(1) for negotiation of a specially indorsed note, and where plaintiff did not otherwise establish standing under any of means established by Fla. Stat. § 673.3011 – Pennington v Ocwen Loan Servicing, LLC, No. 1D13-3072 (Fla. 1st DCA November 6, 2014) (reversed and remanded).

FINANCIAL SERVICES UPDATE

• HOEPA Violation:  although savings clause in mortgage note can protect lender from inadvertent usurious interest rate, it cannot protect lender from violating HOEPA  because that would undermines the intent of Congress to protect consumers against predatory lending – Katline Realty Corp. v Avedon, No. 3D13-2257 (Fla. 3d DCA Nov. 5, 2014) (affirmed in part, reversed in part, remanded on issue of calculating damages).

TITLE INSURANCE UPDATE

• Title Search: title search report is for title insurer’s use and does not serve to warn purchaser of every risk relating to the property – TIMAC Realty v. G & E Tremont LLC, No. 06858 (N.Y. App. Oct. 9, 2014) (affirming order granting motion to dismiss)
• Coverage: title insurance policy does not cover liens attaching to property post-policy, even if the charges were incurred pre-policy, unless the lien is recorded at the time the policy is issued – TIMAC Realty v. G & E Tremont LLC, No. 06858 (N.Y. App. Oct. 9, 2014) (affirming order granting motion to dismiss)
• After Acquired Title: real property acquired by mortgagor after it is mortgaged is deemed to be covered by the lien on the theory that the mortgagor is estopped from denying title under such circumstances – RNT Holdings, LLC v. United General Title Ins. Co., No. B250089  (Cal. App. Oct. 28, 2014) (affirming summary judgment)
• Recording: the validity of a mortgage is unaffected even though the mortgage is recorded after borrower conveys title to property to his personal trust, because the trust is not a bona fide purchaser – RNT Holdings, LLC v. United General Title Ins. Co., No. B250089  (Cal. App. Oct. 28, 2014) (affirming summary judgment)
• Coverage: once mortgage lien is satisfied and the lender does not retain any interest in title to the property or liability by means of the conveyance, then coverage under the policy is terminated – RNT Holdings, LLC v. United General Title Ins. Co., No. B250089  (Cal. App. Oct. 28, 2014) (affirming summary judgment)
• Exclusion 3(a): where attorney acts deliberately and intentionally on behalf of lender and borrower and her actions create the alleged defect, the claim is excluded under exclusion 3(a) of the title insurance policy as created, suffered, assumed or agreed to, even though the attorney did not intend to create a title defect – RNT Holdings, LLC v. United General Title Ins. Co., No. B250089  (Cal. App. Oct. 28, 2014) (affirming summary judgment)
• Class Action: scope of agent’s authority in calculating and collecting premiums was sufficiently alleged in complaint for purposes of motion to dismiss – Knight v. Stewart Title Guaranty Co., No. 07-87 (E.D. Ky. Oct. 6 2014) (granting in part and denying in part motion to dismiss)
• Venue: while plaintiff’s choice of venue is rarely disturbed, court granted motion to transfer venue where all of the underlying transaction and events took place in another state – Premier Community Bank v. First American Title Ins. Co., No. 3:14-cv-00913 (D. Or. Sept. 25, 2014) (order granting motion to transfer)
• Access: title insurance policy insures only legal access and where insurer demonstrates the insured property abuts a public street, there is legal access and no coverage for claim of lack of access – 43 Park Owners Group, LLC v. Commonwealth Land Title Ins. Co., No. 2012-08394 (N.Y. App. Sept. 8, 2014) (affirming summary judgment)
• Coverage: where insurer retains counsel to defend the lien of an insured mortgage and settles the claims against it, its satisfies its obligations under the title insurance policy and has no further duty to indemnify – E.C.I. Financial Corp. v. First American Title Ins. Co. of New York, No. 2013-00186 (N.Y. App. Oct. 15, 2014) (affirming summary judgment)
• Coverage: matters affecting marketability of the property, but not marketability of the title, such as a final public report, are not covered under a policy of title insurance – Security Service Federal Credit Union v. First American Title Ins. Co., No. 2:10-cv-04824 (9th Cir. Oct. 28, 2014) (affirming summary judgment)
• Exclusions: insurer does not waive right to assert exclusion under title insurance policy where denial letter does not expressly cite to the specific exclusion but instead references no loss to the insured and reserves the insurer’s rights – Pasha v. Commonwealth Land Title Ins. Co., No. 2013-CA-000848 (Ky. App. Oct. 31, 2014) (affirming summary judgment)
• Escrow Agent: owner who claimed but for agent’s breach of escrow instructions in failing to obtain an ALTA title insurance policy it would not have closed transaction was not entitled recover loss of down payment that was lost due to its failure to pay its mortgage payments – Sean & Shenassa 26, LLC v. Chicago Title Co., No. D063003 (Cal. App. Oct. 31, 2014) (affirming trial judgment)