Author name: jsinger

Foreclosure denied when the lender obtained assignment of the note and mortgage after filing the foreclosure action

/ Consumer Protection, Mortgages, Real Estate Transactions, Title Issues

In Federal Home Loan Mortgage Corp. v. Schwartzwald, 2012 Ohio 5017, 2012 Ohio LEXIS 2628 (Ohio 2012), the Supreme Court of Ohio joined other courts that have refused to allow banks to foreclose if they cannot prove by written evidence at the time of foreclosure that they have a legal right to foreclose. In this case, Federal Home Loan commenced a foreclosure action before it obtained an assignment of the promissory note and mortgage securing the loan, although it attempted to “cure” that defect by obtaining the assignment later. The Supreme Court of Ohio reversed lower court rulings that had decided that the cure would allow the foreclosure to proceed; instead, it held that state law required lawful standing at the time the foreclosure action was brought. It cited cases from other states that denied standing to MERS (Mortgage Electronic Registration Systems) because it did not possess any interest in the note …

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Protecting surrogate mother’s right to change her mind, NJ high court denies infertile wife’s claim to be listed as the parent at birth of a child born to another woman artificially inseminated with the husband’s sperm

/ Marital Property

An evenly-divided Supreme Court of New Jersey affirmed a lower court’s opinion that protected the potential parental rights of a surrogate mother who had been implanted with the sperm of a man and the egg of an anonymous donor and denying the right of the man’s wife to have her name placed on the birth certificate with her husband’s at the time of birth of the child even though it was contingent on the surrogate mother’s right to change her mind up to 72 hours after the birth of the child. In re T.J.S., 2012 WL 5233616 (N.J. 2012), aff’g In re T.J.S., 16 A.3d 386 (N.J. Super. Ct. App. Div. 2011). The state statute affirms the potential parental rights of the sperm donor and the biological mother who gives birth to the child, as well as the egg donor. The statute protects the rights of the biological mother to retain parental rights …

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Supreme Court takes certiorari in two takings cases

/ Takings

Arkansas Game & Fish Comm’n v. United States, 637 F.3d 1366 (Fed. Cir. 2011), held that deviations by the Army Corps of Engineers from a flood management plan that resulted in temporary flooding of riverfront property did not constitute a taking of property without just compensation but might constitute a tort for which compensation could be sought. The flood management plan exists because the riverfront property is subject to flooding in the first place and it is intended to alleviate that. The doctrinal issue likely to be the focus of the Supreme Court’s ruling is whether temporary flooding constitutes a taking of property. Koontz v. St. Johns River Water Management District, 77 So. 3d 1220 (Fla. 2011), held that the state of Florida did not take the landowner’s property when it proposed to allow the owner to dredge the property on condition that several exactions were met. The owner refused …

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Loft landlord denied right to evict until housing is brought up to code

/ Consumer Protection, Leaseholds

The New York Court of Appeals has held that a loft owner who has not complied with regulations designed to ensure that lofts are habitable cannot collect rent or evict the residential tenant from her home. Chazon v. Maugenest, 971 N.E.2d 852 (N.Y. 2012). In one sense this is a straight-forward application of modern landlord/tenant law. The case is unusual because the tenant has been living in the loft without paying rent for nine years and because the tenant’s initial occupation was illegal since the property had been formerly used for commercial purposes and rented to a residential tenant in violation of New York City ordinances. The Court felt it had no discretion given the clear language of the loft law. That law had been intended to induce loft landlords to upgrade the property to make it habitable but hundreds of such landlords have still not complied with it despite the …

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Commercial landlord owes no duty of care to visitors inside leased premises

/ Leaseholds

The Massachusetts Appeals Court reaffirms that, unlike residential landlords, commercial landlords have no duty to repair the leased premises in the absence of a contractual obligation to do so. Marino v. Mystic Realty Trust, 2012 WL 4033738, 82 Mass. App. Ct. 1113 (Sept. 14, 2012). The opinion applied established Massachusetts law. Humphrey v. Byron, 850 N.E. 2d 1044 (Mass. 2006). A consequence of this no duty rule is that commercial landlords owe no duty to exercise reasonable care to assure that visitors are not subject to unreasonable risk of harm while on the leased premises. Commercial landlords do have a duty to maintain common areas and thus must protect visitors from unreasonable risk of harm there.

Vermont civil union counts as a marriage in Massachusetts

/ Antidiscrimination Law, Marital Property, Sexual Orientation

The Supreme Judicial Court of the Commonwealth of Massachusetts held that a man who entered into a civil union with another man in Vermont could not marry a different man in Massachusetts before dissolving the civil union. Elia-Warnken v. Elia, 463 Mass. 29, 2012 Mass. LEXIS 678 (Mass. 2012). The court dismissed divorce proceedings in Massachusetts on the ground that the marriage was void from the beginning since one of the men was still “married” (under a “civil union”) to another man in Vermont. The result denied the “spouse” in Massachusetts any remedies such as equitable distribution of property on the ground that otherwise one person would be married to two people at once with conflicting support obligations. The court cited an article of mine, Joseph William Singer, Same–Sex Marriage, Full Faith and Credit, and the Evasion of Obligation, 1 Stan. J. C.R. & C.L. 1, 29, 36, 50 (2005). Presumably, an …

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Tribal sovereign immunity prevents state foreclosure for failure to pay state property taxes

/ Tribal Property

Applying the standards set down by the Second Circuit in Oneida Indian Nation of N.Y. v. Madison County, 605 F.3d 149 (2d Cir. 2010, a federal district in New York affirmed that a county could not foreclose on tribal land for nonpayment of state property taxes on the ground that the tribe has sovereign immunity that it has not waived and that has not been abrogated by federal law. Cayuga Indian Nation of N.Y. v. Seneca County, 2012 U.S. Dist. LEXIS 117245 (W.D.N.Y. 2012).

Washington Supreme Court holds MERS cannot initiate private deed of trust foreclosures

/ Consumer Protection, Mortgages, Real Estate Transactions

In Washington state, lenders typically use the deed of trust form for mortgages where the lender is the “beneficiary” of the trust and the “trustee” has the power to act to protect the beneficiary’s interest by foreclosing on the property if the borrower defaults on the note (the underlying loan). MERS is typically listed as the beneficiary of the deed of trust rather than the lender that actually issued the loan  (and signed the note) in order to avoid having to record future assignments of the mortgage; the deed of trust is recorded listing MERS as the beneficiary rather than the lender that issued the note to the borrower/homeowner. Interpreting the meaning of the word “beneficiary” in state foreclosure statutes, the Washington Supreme Court agreed with other courts that have held that MERS is not actually the beneficiary of the note and thus has no power to initiate a nonjudicial …

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Implied beach easement found from recorded plans and sales statements

/ Easements, Real Estate Transactions, Servitudes

A Massachusetts court has held that owners of lots near the ocean had an implied easement of access to the beach because recorded plans drafted in 1892 showed an unenumerated lot with access to the ocean and the developer had advertised the lots as “Shore Lots” with a “Cool breeze all the time, good bathing, boating and fishing, nice beach, no undertow, shade trees on several of the lots.” Leahy v. Graveline, 82 Mass.App.Ct. 144, — N.E.2d —, 2012 WL 2819395 (Mass. Land Ct. 2012). The case represents an application of the recent decision in Reagan v. Brissey, 844 N.E.2d 672 (Mass. 2006) that similarly found implied rights to use open land depicted on a subdivision map.

Court affirms that nonuse does not extinguish an old easement

/ Adverse Possession, Easements, Real Estate Transactions, Servitudes

The Supreme Judicial Court of the Commonwealth of Massachusetts has reaffirmed that even longstanding non-use of an easement will not extinguish it or cause it to lapse because of prescription. Cater v. Bednarek, — N.E.2d —, 462 Mass. 523 (Mass. 2012). To extinguish an easement by prescription requires acts inconsistent with the easement that put the easement owner on notice that its uses are being disrupted. Moreover, if the servient estate owner makes only part of an easement inaccessible, it is extinguished only as to that part but not the rest. In addition, the court held that, where a deed does not specify the dimensions of the easement, it must be interpreted to establish dimensions that are reasonably necessary for the enjoyment of the dominant estate; the easement is not limited to the purposes for which the dominant estate was used at the time the easement was created. Moreover, if the easement …

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