New York Court Holds Principal of Title Agent Could Not Claim Fraud Against Title Insurer for Guaranty

The Supreme Court of New York, Kings County, recently dismissed a fraud claim brought by the principal of a title agent against a title insurance company, finding that any claim that the insurer misrepresented the terms of the guaranty—and there was no evidence supporting this claim—was irrelevant because the principal reviewed the guaranty before signing.  See Chicago Title Ins. Co. v. Brookwood Title Agency LLC, 2020 WL 5369206 (N.Y. Sup. Ct. Sep. 04, 2020).  

New Jersey Federal Court Dismisses Defamation Claim Against Title Insurer for Letter to Prior Property Owner Regarding Unpaid Mortgage

The United States District Court for the District of New Jersey recently dismissed a prior property owner’s defamation suit brought against a title insurance company after the company sent a letter regarding a mortgage the seller failed to disclose or discharge.  See Ezeiruaku v. Fid. Nat'l Title Ins. Co., 2020 WL 5587438 (D.N.J. Sept. 18, 2020). 

New Jersey Court Holds Surplus Proceeds From Foreclosure Sale Should Be Used to Pay Judgment Lien Against One Spouse

A New Jersey trial court recently held that the surplus proceeds from a foreclosure sale should be used to pay the judgment lien recorded against only one of the spouses when the other spouse failed to contest the judgment creditor’s pre-sale motion, and only objected after the sale.  See Wilmington Savings Fund Society, FSB, as Trustee of Stanwich Mortgage Loan Trust v. Schneeweiss, et al., F-13586-17, (N.J. Ch. Div., Aug. 25, 2020). 

Eleventh Circuit Affirms Dismissal of Time-Barred FDCPA Complaint, Despite State Renewal Statute That Allows Plaintiffs to Refile Within Six Months of Voluntary Dismissal

The United States Court of Appeals for the Eleventh Circuit recently affirmed the dismissal of a FDCPA claim as untimely, holding that a Georgia statute that allows a party to voluntarily dismiss a timely action and then refile it within six months could not overcome the FDCPA’s one-year limitations period.  See Edwards v. Solomon & Solomon, P.C., 2020 WL 5816754 (11th Cir. Sept. 30, 2020).

Ninth Circuit Holds HOLA Preempted California State Law Regarding Escrow Interest, Even After Assignment of Mortgage to National Bank

In a split decision, the United States Court of Appeals for the Ninth Circuit recently found that the Home Owners’ Loan Act of 1933 (“HOLA”) and its regulations preempted a California state law that required banks to pay borrowers interest on escrow accounts, even after the original savings association assigned the mortgage to a national bank. See McShannock v. JP Morgan Chase Bank NA, 2020 WL 5639700 (9th Cir. Sept. 22, 2020).

Kansas Federal Court Holds Lender Did Not Violate Usury Law, FDCPA, RESPA, or TILA, but May Have Breached Contract For Not Immediately Applying Partial Payment

The United States District Court for the District of Kansas recently found that a lender did not violate a state usury law or the FDCPA, RESPA or TILA in its handling of plaintiffs’ mortgage, but may have violated the contract by not immediately applying plaintiffs’ partial payments.  See Schneider v. U.S. Bank, N.A., 2020 WL 4673159 (D. Kan. Aug. 12, 2020).  In 2010, plaintiffs obtained a mortgage loan from defendant.  At the time of the loan, the interest rate exceeded the maximum interest rate in Kansas. 

New Jersey Appellate Division Holds Judgment Lien Should Be Discharged Post-Bankruptcy

The New Jersey Appellate Division recently discharged a creditor’s judgment lien on the debtor’s property after the debtor declared bankruptcy and had the underlying debt discharged.  See Cooper Electric Supply Co., v. J & Jay Electric, Inc., 2020 WL 5496490 (N.J. Super. Ct. App. Div. Sept. 11, 2020).  In 2008, plaintiff obtained a judgment against defendant and docketed the judgment. 

Second Circuit Holds Collection Letter Did Not Violate FDCPA For Failing to State That Debtor Could Challenge Portion of Debt

The United States Court of Appeals for the Second Circuit recently affirmed a lower court’s decision and held that a debt collection letter that did not state that a debtor had the right to challenge a portion of the debt within 30 days did not violate the FDCPA.  See Chaperon v. Sontag & Hyman, PC, 2020 WL 5240609 (2d Cir. Sept. 3, 2020). 

Kentucky Appellate Court Denies Claim Against Title Searcher as Untimely, Holds There Is No Equitable Estoppel Claim Against Title Insurer Who Initially Gives Coverage for Claim Before Later Denying

The Court of Appeals of Kentucky recently held that claims against a closing attorney who performed a title search were untimely, and that insureds did not have a claim against their title insurance company when the company initially found that the claim was “potentially covered” before later denying the claim based on one policy provision, and then later prevailing on summary judgment on another provision.  See Pasha v. Eisele, 2020 WL 4555812 (Ky. Ct. App. Aug. 7, 2020).