Specialized Loan Servicing, LLC v. January

Specialized Loan Servicing, LLC sued Assurant Specialty Property, American Security Insurance Company, Donyelle January and Capital One Bank over a mortgage agreement. Specialized was the servicer of the note and mortgage executed by January. Specialized was the primary insured on a policy covering the property issued by Assurant and a subsidiary underwriter, American Security. After a fire, American Security cut a check made out to January and Specialized. The check was sent to Assurant who then forwarded it to January with instructions on how to endorse the check and then to return the check to Specialized. January negotiated the check to Capital One; Capital One cashed the check in favor of January with no endorsement from Specialized. Specialized contacted Assurant for an explanation, and Assurant claimed someone altered the check. Capital One rejected Specialized's fraud claim. Capital One filed a peremptory exception of prescription, contending that Louisiana law set a one-year prescription period: the check was negotiated in 2009, and suit was filed in 2010. The ultimate issue before the Supreme Court in this case was whether the doctrine of contra non valetem was applicable to suspend the prescription of a conversion claim against a payor. Upon review of the applicable statutes and the trial court record, the Court agreed with the Court of Appeal that the doctrine could not suspend the one-year prescriptive period. View "Specialized Loan Servicing, LLC v. January" on Justia Law