First Circuit Holds No Equitable Lien for Lender Where Home Equity Line of Credit Debtor Was Not Actual Owner of Property, Proceeds Used to Buy Another Property

The United States Court of Appeals for the First Circuit recently reversed a District Court decision and held that a creditor was not entitled to an equitable lien arising from a Home Equity Line of Credit (HELOC) when the debtor did not actually own the property and used the proceeds from the loan to buy another property.  See Wilmington Sav. Fund Soc'y, FSB v. Collart, 980 F.3d 210 (1st Cir. 2020).

Texas Federal Court Holds Limitations Period May Not Have Run on FDCPA Claim if Creditor Obtained Default Judgment in Improper Venue

The United States District Court for the Eastern District of Texas recently denied a debt collector’s motion to dismiss, holding that the one-year statute of limitations under the FDCPA may not have commenced if the creditor brought its action against the debtor in an improper venue.  See Barboza v. Weinstein & Riley, P.S., 2020 WL 5849549 (E.D. Tex. 2020). 

Ninth Circuit Reverses District Court, Holds Debt Collector Cannot Simply Rely on Creditor Providing Accurate Information to Invoke Bona Fide Error Defense

The United States Court of Appeals for the Ninth Circuit recently reversed a District Court and held that a debt collector who sends a collection letter seeking an incorrect amount owed cannot use the FDCPA’s bona fide error defense solely because its contract with the creditor required the creditor to provide accurate information.  See Urbina v. Nat’l Bus. Factors Inc., 979 F.3d 758 (9th Cir. 2020). 

Florida Supreme Court Holds Trial Court Had Jurisdiction to Hear Post-Foreclosure Judgment Motion from Foreclosure Sale Purchaser Regarding Betterment

The Supreme Court of Florida recently reversed an appellate court and found that a trial court retained jurisdiction to hear the motion of a foreclosure sale purchaser regarding whether he was entitled to compensation for improving the property before the sale was vacated. See Griffin v. LaSalle Bank, N.A., 2020 WL 579183 (Fla. Feb. 6, 2020). 

New Jersey Appellate Division Holds No Reimbursement of Municipal Taxes for Undisclosed Conservation Easement

In a decision approved for publication, the New Jersey Appellate Division recently held that the holder of a tax lien who, upon attempting to foreclose on the property, learns that it is encumbered by a previously undisclosed conservation easement, is unable to recoup municipal taxes paid on the property in the absence of bad faith on the part of the Township. Garden State Investment & Isadore H. May v. Township of Brick, 2020 WL 7250904 (N.J. Super. Ct. App. Div. Dec. 10, 2020).

New York Appellate Court Holds Lender’s Mortgage Was Not Reinstated After Borrowers Bought Property Back From City After Tax Foreclosure

The New York Appellate Division, Third Department, recently held that a tax sale foreclosure extinguished a mortgage on a property and, more important, the mortgage was not reinstated when the City later quitclaimed the property back to the borrowers as part of the borrowers’ bankruptcy action. See Wells Fargo Bank, N.A. as Tr. for Carrington Mortg. Loan Tr., Series 2006-NC2 Asset- Backed Pass-Through Certificates v. Budram, 188 A.D.3d 1324 (N.Y. App. Div. 2020).

Idaho Federal Court Holds Insured Prohibited from Suing Title Insurance Company After Insured Lost State Court Action Against Title Agent

The United States District Court for the District of Idaho recently dismissed an action brought by an insured against a title insurance company, finding that the insured had unsuccessfully raised similar claims in a state court action with the title agent.  See Cummings v. Stewart Title Guar. Co., 2020 WL 6747977 (D. Idaho Nov. 17, 2020).