New Jersey Appellate Court Dismisses Lender’s Deficiency Action When Required Notice Was Not Recorded Before Lender Filed Complaint, Despite Purportedly Timely Mailing

The New Jersey Appellate Division recently held that a lender’s deficiency action was barred because the Notice of Proposed Deficiency Action was not recorded by the county clerk until five days after the lender’s deficiency complaint was filed, even though the lender had mailed the Notice to the clerk two weeks earlier.  See Foreclosed Assets Sales & Transfer P’ship v. Strauss, 2019 WL 1092703 (N.J. Super. Ct. App. Div. Mar. 8, 2019). 

New Jersey Federal Court Denies Motion to Dismiss RESPA Claim Based on Alleged Kickbacks Between Lender and Title Agent

The United States District Court for the District of New Jersey recently denied a lender’s motion to dismiss a putative class action complaint in which plaintiffs alleged violations of the Real Estate Settlement Procedures Act (“RESPA”) arising out of an alleged kickback scheme between the lender and the title agent.  See Conover v. Patriot Land Transfer, LLC, 2019 WL 397978 (D.N.J. Jan. 31, 2019).

California Appellate Court Holds Insured Not Entitled to Coverage for Easement When Policy Excepted Agreement That Included Easement

A California appellate court recently affirmed that an insured property owner was not entitled to coverage for a neighbor’s easement running across the insured property because the policy excepted “matters contained in” a Shared Road Maintenance Agreement, and this Agreement described the easement rights.  See Beaudin v. Stewart Title Guar. Co., 2019 WL 422208 (Cal. Ct. App. Feb. 4, 2019), reh’g denied (Feb. 21, 2019), review filed (Mar. 13, 2019). 

Wisconsin Appellate Court Finds Lender Can Proceed With Foreclosure Despite Previous Stipulation Stating Loan Was Paid

A Wisconsin appellate court recently reversed a trial court’s order granting summary judgment for the homeowners and held that a lender’s foreclosure claim could proceed, despite the fact that the lender’s predecessor previously had filed a stipulation dismissing a foreclosure “due to payoff of the loan.”  See Deutsche Bank National Trust Company, v. Buboltz, et al., 2019 WL 549771 (Wis. Ct. App. Feb. 12, 2019).  

California Appellate Court Holds Insured Lender Not Entitled To Coverage in Action Regarding Validity of Subdivision

A California Appellate Court recently affirmed that an insured lender was not entitled to coverage for an action in which a party challenged the validity of a subdivision, and that a court’s determination that the subdivision was invalid did not render title unmarketable under the policy.  See Northern California Comm. Development Corp. v. First American Title Ins. Co., 2019 WL 1397040 (Cal. Ct. App. Mar. 28, 2019).

Second Circuit Holds That Landlord May Be Liable Under the FHA for One Tenant’s Racial Harassment of Another

In a split decision, the United States Court of Appeals for the Second Circuit recently reversed Judge Spatt of the Eastern District of New York and held that a landlord may be liable under the Fair Housing Act of 1968 (the “FHA”) for failing to address a situation in which one tenant repeatedly used racially-charged language to harass another.  See Francis v. Kings Park Manor, Inc., 917 F.3d 109 (2d Cir. 2019).  This decision is significant in that it opens the door to landlords being subject to a duty to intervene when made aware of discriminatory conduct between tenants.

Florida Appellate Court Holds Lender Not Entitled to Summary Judgment on Bona Fide Lender Claim Because of “Series of Suspicious Documents” in Records

A Florida appellate court reversed a trial court and held that a reverse mortgage lender was not entitled to summary judgment on the claim that it was a bona fide lender for value because there was a series of irregularities in the public records.  See CitiMortgage, Inc. v. Porter, 261 So. 3d 739 (Fla. Dist. Ct. App. 2018).  In 2005, the borrower executed a mortgage on his property that eventually was assigned to CitiMortgage.  In 2010, CitiMortgage initiated a foreclosure action and filed a notice of lis pendens. 

Tenth Circuit Holds Title Insurance Company Had No Duty to Defend or Indemnify Insured Lender in Fraudulent Conveyance Action

In a decision approved for publication, the United States Court of Appeals for the Tenth Circuit recently reversed a District Court and found that a title insurance company did not have a duty to defend an insured lender in an action alleging that the borrower’s conveyance of deeds of trust to the lender was fraudulent.  See Banner Bank v. First Am. Title Ins. Co., 2019 WL 924792 (10th Cir. Feb. 26, 2019). 

New York Appellate Court Holds Judgment Creditor Can Recover from Jointly-Rented Safe Deposit Box

New York’s First Department Appellate Division recently affirmed a lower court decision and held that a judgment creditor can recover property from a safe deposit box on which the debtor and his wife are joint tenants, despite the claim that the box’s property was solely owned by the wife.   See New York Cmty. Bank v. Bank of Am., N.A., 169 A.D.3d 35 (1st Dept. 2019).  In 2012, New York Community Bank (“NYCB”) obtained a judgment against a debtor.