Welcome to Scribd. Sign in or start your free trial to enjoy unlimited e-books, audiobooks & documents.Find out more
Download
Standard view
Full view
of .
Look up keyword
Like this
1Activity
0 of .
Results for:
No results containing your search query
P. 1
Citizesn State Bank v. Countrywide Home Loans - Indiana Supreme Court Decision

Citizesn State Bank v. Countrywide Home Loans - Indiana Supreme Court Decision

Ratings:
(0)
|Views: 3|Likes:
Published by OAITA
The Indiana Supreme Court decision limiting the use of strict foreclosure to resolve competing liens in a foreclosure action.
The Indiana Supreme Court decision limiting the use of strict foreclosure to resolve competing liens in a foreclosure action.

More info:

Published by: OAITA on Sep 12, 2011
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

04/20/2015

pdf

text

original

 
ATTORNEYSFOR~PELLANTRobertG.ForbesNathanT.Danielson
Forcum,
Forbes
&
Danielson
LLP
HartfordCity,IndianaA'ITORNEYSFOR~PELLEEDonald
L.
CentersHannonKolas
&
Centers,P.C.Indi.anapolis,IndianaATTORNEYSFOR
AMICUS
CURIAE
INDIANALANDTITLE
ASSOCIATION,
INc.
Craig
D.DoyleMarkR
Galliher
Kurt
v.
LakerDoyleLegalCorporation,P.C.Indianapolis,Indiana
3Ju
ttJC
linbiana~uprtmt([ourt
No.76503-1009-CV-515
CmzENSSTATEBANKOFNEW
CASILE,
Appellant(DefendantandCross-claimPlaintiffbelow),
v.
COUNTRYWIDEHOMELOANS,
INC.,
D/p,/A
AMERICA'SWHOLESALE
LENDER,
Appellees(PlaintijfbeJow),
and
FEDERAL
NATIONAL
MORTGAGEASSOC.IATIONAND
STEUBENCOUN1Y
TREASURER.
Appellees(Cross-claimDefendantbelow).
AppealfromtheSteubenSuperiorCourt,No.76DOI-071O-MF-0657TheHonorableWilliamC.Fee,JudgeOnPetitionToTransferfromtheIndianaCourtofAppeals,No.76A03-0909-CV-423
June
29,2011
Rucker,Justice.
 
Amortgageholderforecloseditsmortgage,tooktitletothesubjectpropertyatasheriff'ssale,andthensold'thepropertytoathirdparty.Theforeclosingmortgageesubsequentlydisooveredithadinadvertentlyfailedtonameajuniorlienholder
in
theforeclosureaction.Wegrantedtransfertoshedlightonthestatusoftheoriginalfirstmortgageinthiscontext.
FactsandProcedural
History
OnApril27,2005CountrywideHomeLoans,Inc.("Countrywide')obtainedafirstmortgageagainstcertainrealestateownedbyRita
K
CloudandKennethD.Cloudlocated
in
SteubenCounty.Themortgagewasrecordedtwodayslater.OnAugust28,2006Countrywidefiledaforeclosureaction
against
theCloudsonwhichthetrialcourtenteredjudgmentintheamount$229,416.66plusinterest.Atasheriff'ssaleonFebruary22,2007Countrywidebiditsjudgment'andtooktitletothesubjectpropertybywayofasheriff'sdeed.ThedeedwasrecordedMarch15,2007.BeforetheseeventsoccurredtheCloudsexecutedapromissorynoteinfavorofCitizensStateBankofNewCastle("CitizensBank")inJanuary2003.WhentheCloudsfailedtopaythenote
in
accordancewithitstermsCitizensBankfiledacomplaintintheSteubenCircuitCourt.TheCloudsfailedtorespondandCitizensBankthereafterfiledamotionfordefaultjudgment.ThetrialcourtgrantedthemotiononJune9,2006andenteredjudgmentintheamountof$109,859.38pluscosts,interest,latecharges,andattorneyfees.Appellant'sApp.at24-25.Apparentlythejudgmentwasproperlyrecorded.
2
Therecordshows
that
atthetimeCountrywidefileditsforeclosureaction,itdidnotnameCitizensBankasaparty.
3
ThereafteronApril19,2007Countrywideconveyedtitle
to
thepropertytotheFederalNationalMortgageAssociation
("FNMA")
by
wayofalimitedwarrantydeedwhichwasrecordedonMay3,2007-
I
Thetotalamountofthebid
was
$235,925.30.Appellant'sApp.
at
93.
::l
We
say
"apparently"becausetherecordisnotclearwhetherthejudgment
was
timelyrecordedandindexedinthecounty'sjudgmentdocket.SeeInd.Code§34-55-9-2;Arendv.Etsler,737N.E.2d1173,1175(Ind.Cl
App.
2000)
("[A]
moneyjudgmentbecomesalienonthedebtor'srealproperty
when
thejudgment
is
recordedintilejudgmentdocketinthecountywheretherealtyheldbythedebtorislocated.").However,allpartiesargueas
if
thereisnoquestion
that
thejudgment
was
properlyrecorded.AndduringoralargumentCountrywidedeclaredtbatitdidnotdisputethatthejudgmentlien
was
properlyindexedanddocketed.
3
FifthThirdBank
dJb/a
FifthThirdBank,Indiana(Central)
was
theonlyothernamedpartydefendant.HowevertheBankconsentedtoentryoftheforeclosurejudgmentandisnolongeraninterestedparty.Appellant'sApp.
at
27.
2
 
SometimelaterCountrywidediscoveredCitizensBank'sjudgmentlienontheproperty.InconsequenceCountrywidefiledanactiontitled"ComplaintforStrictForeclosure"inwhichitsought,amongotherthings,
to
forecloseanyinterestor"equityofredemption'?"thatCitizensBankmayhave
in
thesubjectproperty.Appellant'sApp..at7.CitizensBankresponded
with
ananswerandfiledaseparatecomplaintagainstFNMAseekingtoforecloseCitizensBank'sjudgmentlien.The
trial
courtconsolidatedthetwoactions.Citizens
Bank
movedforsummaryjudgmentandCountrywideand
FNMA
filedajointcross-motionforsummaryjudgmentAfterahearing,the
trial
courtissuedanordergrantingthejointmotionanddirectedCitizens
Bank.
toredeemCountrywide'smortgage
within
30
days
orbeforeverbarredfromassertingitsjudgmentlienagainstthesubjectproperty.Citizens
Bank.
appealedandtheCourtofAppealsreversedthejudgmentofthetrialcourtholdingthatthroughoperationofthedoctrineofmerger,anti-merger,and
an
exceptiontoanti-merger,Countrywide's
lienwas
extinguishedandcouldnolongerbeassertedagainstCitizens
Bank,
CitizensState
Bank
ofNewCastlev.CountrywideHomeLoans,Inc.,
922
N.E.2d
655
(Ind.
Ct.
App.2010).HavingpreviouslygrantedtransfertherebyvacatingtheopinionoftheCourtofAppeals,seeInd.AppellateRule58(A),wealsoreversethejudgmentofthetrialcourtbutongroundsslightlydifferentfromthoseofourcolleagues.
Background
In
atypicalrealestatemortgagetransactiontherearebasicallytwoentities:themortgagee-typicallyabankormortgagecompany-thatholdsthemortgagewhichservesasalienontheproperty;andthemortgagor-typicallythehomeowner-whoholdslegaltitlewiththerightofredemption.Whenoneoftheentities-typicallythemortgageebywayofforeclosure-acquiresboththelienandlegaltitletotheproperty,thenthetwointerestsaresaidto"merge."That
is,
themortgagemergeswiththelegal
title,
and
thelien
is
therebyextinguished.
4
"EquityofRedemption"isdefinedasthe"rightofamortgagorindefaulttorecoverpropertybeforeaforeclosuresale
by
payingtheprincipal,interest,andothercoststhataredue."Black'sLawDictionary620(9thed.2009);seealsoOi<i1amv.Noble,66N.E.2d614,617(Ind.
Ct.
App.1946)(discussingequityofredemptionin''titlestates"ascontrastedwithstatesadoptingthe"lientheory"ofmortgages).
3

You're Reading a Free Preview

Download
scribd
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->