Articles Posted in Idaho Supreme Court - Civil

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North Idaho Resorts (NIR) appealed the district court’s grant of summary judgment in favor of Union Bank, N.A. (Union Bank) in a mortgage priority dispute. The district court held that NIR did not possess a vendor’s lien because NIR was not the owner of record and that any lien NIR might have possessed had no value. The district court further held that if NIR possessed a valid lien, NIR released any such lien as part of a recorded agreement and that Union Bank was a good faith encumbrancer with no actual or constructive knowledge of the lien. On appeal, NIR argued: (1) the district court misconstrued Idaho Code section 45-801 and that the statute did not require the seller to be the owner of record; (2) the remaining conditional purchase price constituted an unpaid and unsecured value; (3) Union Bank knew NIR was still owed money under the contract; and (4) Union Bank did not qualify as a good faith encumbrancer. Finding no reversible error, the Supreme Court affirmed the district court’s judgment. View "Union Bank, N.A. v. North Idaho Resorts" on Justia Law

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JV, LLC (JV) appealed the district court’s grant of summary judgment in favor of Union Bank, N.A. (Union Bank) in a mortgage priority dispute. Union Bank sought to foreclose a mortgage on a property known as “Trestle Creek.” JV claimed priority to the Trestle Creek property through a mortgage recorded June 19, 2006. Union Bank’s mortgage was recorded March 25, 2008. Union Bank moved for summary judgment, arguing that JV had subordinated its lien to that of Union Bank. The district court agreed and granted the motion. Finding no reversible error, the Supreme Court affirmed the district court’s judgment. View "Union Bank, N.A. v. JV L.L.C" on Justia Law

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Charles and Donna Nickerson appeal from the grant of summary judgment in favor of PHH Mortgage and J.P. Morgan Chase Bank. The suit involved an action for judicial foreclosure of a loan by PHH Mortgage against the Nickersons, and third-party claims against J.P. Morgan Chase by the Nickersons. The Nickersons argued they were entitled to relief based on: mistakes by the court; surprise due to the actions and withdrawal of their former counsel; excusable neglect due to their reliance on their former counsel; new evidence showing PHH did not have standing to pursue foreclosure; fraud regarding PHH’s chain of title, the amount of default, and coercion of the Nickersons at closing; and misconduct of the opposing parties regarding the depositions of the Nickersons and the submission of a fraudulent affidavit. The district court denied the Nickersons’ motions, concluding that the Nickersons failed to present admissible evidence to support their claims. Finding no reversible error in the trial court's decision to grant summary judgment in favor of PHH Mortgage, the Supreme Court affirmed. View "PHH Mortgage v. Nickerson" on Justia Law

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This was a case involving a dispute over a mistakenly released deed of trust, which secured a 2004 residential mortgage between Ralph Sheets and the lender, Bank of America, N.A., f/k/a Countrywide Home Loans, Inc. (Countrywide); the servicer of the loan; and the trustee who executed the mistaken release (companies collectively referred to as “Bank of America”). Sheets borrowed $65,250 from Countrywide. He executed a promissory note, secured by a deed of trust to his home in New Meadows. Between December of 2004 and April of 2009, Sheets timely paid the amounts due on the note. In 2008, Countrywide sent Sheets a letter telling Sheets that he “may” qualify for a lower interest rate on a refinancing loan and estimating he had $88,056 equity in the home. Around this time, Bank of America acquired and merged with Countrywide. In the late spring of 2009, Sheets applied for a new loan (the 2009 Refinancing). Closing on the new loan was scheduled for October 27. Sheets testified that the title company agent at the closing would not let him execute the documents because they were “bad” and incomplete. Thus, the 2009 Refinancing did not close. Sheets arrived home and found proposed closing documents, but he did not sign the documents because he did not agree with the terms contained therein. The trustee of the deed of trust, ReconTrust Company, N.A. (ReconTrust), erroneously recorded a full reconveyance of the deed of trust securing Sheets’ original note. How the erroneous reconveyance came to be recorded was not clear. Bank of America claimed that it caused the reconveyance to be recorded because it mistakenly proceeded as if the 2009 Refinancing had closed. On March 29, 2010, Bank of America sent Sheets a letter asking Sheets to stipulate to rescinding the reconveyance. The next day, Bank of America filed a complaint against Sheets seeking reinstatement of the deed of trust. On May 25, 2010, Bank of America sent Sheets a notice of its intent to commence foreclosure proceedings. Sheets filed an answer, counterclaim, demand for jury trial, and third party complaint against the third-party defendants in this action. He brought counterclaims for: (1) breach of contract; (2) specific performance; (3) violation of the Idaho Consumer Protection Act; (4) violation of the federal Fair Credit Reporting Act; (5) slander of credit; and (6) violation of Idaho Code section 45-1502. In 2012, Bank of America filed two motions for summary judgment, seeking reinstatement of the deed of trust and dismissal of Sheets’ counterclaims. The district court granted summary judgment reinstating the deed of trust and dismissing Sheets’ counterclaims. Finding no error in the grant of summary judgment, the Supreme Court affirmed. View "Sheets v. Bank of America" on Justia Law

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Greg and Jessica Skinner appealed a judgment dismissing the Skinners’ claim of negligence against U.S. Bank Home Mortgage. U.S. Bank retained insurance funds received after the Skinners’ home was destroyed by fire and released a portion of the funds as the home was rebuilt. There were serious defects in the new construction that ultimately culminated in the project being abandoned. The Skinners claimed that the district court improperly granted summary judgment because U.S. Bank owed the Skinners a fiduciary duties regarding the disbursement of the insurance proceeds. Finding no reversible error, the Supreme Court affirmed. View "Skinner v. U.S. Bank Home Mortgage" on Justia Law

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Charles and Gail Houpt appealed a district court’s grant of summary judgment in favor of Wells Fargo Bank and First American Title Company (FATCO). In March 1993, the Houpts executed a promissory note to the American Bank of Commerce (Note). As security on the Note, the Houpts granted a deed of trust in the Property to American Bank of Commerce, as beneficiary, and FATCO, as Trustee (Deed of Trust). Over a period of time spanning from 1994 to 2004, American Bank of Commerce went through a series of mergers and transactions that resulted in Wells Fargo Bank obtaining the obligation owing under the Note and secured by the Deed of Trust. However, a written assignment of the Note and Deed of Trust designating Wells Fargo Bank as the beneficiary of such was not filed during this time. Starting in November 2007, the Houpts failed to make numerous payments on the Note and ceased all payments by the end of 2009. Consequently, Wells Fargo Bank directed FATCO to foreclose on the Property and on October 18, 2010, FATCO filed a Notice of Trustee’s Sale listing American Bank of Commerce as the current beneficiary and setting the date of the sale for February 17, 2011. The day before the scheduled trustee’s sale, the Houpts filed for Chapter 7 bankruptcy. A year later Wells Fargo Bank was granted stay relief by the bankruptcy court and resumed foreclosure on the Property. The Houpts filed a Complaint and Motion for Preliminary Injunction stating that: (1) Wells Fargo Bank was not the beneficiary or other real party in interest of the Deed of Trust, and as such, Wells Fargo improperly initiated a nonjudicial foreclosure; (2) the district court should grant a preliminary injunction to stop the foreclosure sale; and (3) Wells Fargo’s actions constituted wrongful foreclosure. Wells Fargo denied all claims made and argued that Wells Fargo Bank was the beneficiary of the Deed of Trust through merger and consolidation and, therefore, was exempted from having to record a written assignment of the Deed of Trust prior to exercising its power of sale. Notwithstanding this argument, Wells Fargo Bank obtained a written assignment of the Note and Deed of Trust from Wells Fargo Northwest on August 24, 2012, and recorded the assignment in 2012. The district court, noting that Wells Fargo had recorded its assignment of the Deed of Trust, denied the Houpts’ motion for preliminary injunction but left open the possibility that Wells Fargo had committed a wrongful foreclosure. Ultimately, the district court found that because no foreclosure sale had occurred, Wells Fargo was entitled to summary judgment as a matter of law. After denying Houpts’ request for reconsideration, the district court entered judgment in favor of Wells Fargo and awarded attorney fees and costs. The Houpts appealed. The Supreme Court affirmed the grant of summary judgment in favor of Wells Fargo, but remanded for a determination of what effect, if any, a SBA payment and the date of default had on the interest and balance due under the Note. Further, the Court vacated the district court’s grant of attorney fees and costs and remanded for a determination of costs and fees with specific instruction to exclude all costs and fees incurred by Wells Fargo before September 4, 2012. View "Houpt v. Wells Fargo Bank, NA" on Justia Law

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At the heart of this appeal was a mechanic's lien filed against the Black Rock North Development in Coeur d?Alene, Idaho, and an uncompleted golf course community development. American Bank (the Bank) was the lender to BRN Development, Inc. (BRN). BRN hired Wadsworth Golf Construction Company of the Southwest (Wadsworth) to construct a golf course. BRN failed to pay Wadsworth for a portion of the work it performed, and Wadsworth filed a mechanic's lien against the property. BRN defaulted on the loan, and the Bank initiated foreclosure proceedings. Wadsworth's claim of lien was subordinate to the Bank's mortgage interest in the property. In order to proceed with a foreclosure sale, the Bank posted a lien release bond in order to secure the district court's order releasing Wadsworth's lien. The Bank was the successful bidder at the foreclosure sale. The district court ruled that priority of the parties? claims against the property was irrelevant once the property was replaced by the lien release bond as security for Wadsworth's claim and the Bank (by way of the bond) was responsible for payment of Wadsworth's lien claim. The Bank appeals that decision, arguing that Wadsworth should have been prevented from recovering against the lien release bond because its interest would have been extinguished if it had attempted to foreclose its mechanic's lien and the bond merely served as substitute security in place of the property. Wadsworth cross-appealed, arguing the district court erred in holding that Wadsworth waived its right to file a lien for the unpaid retainage on the contract. Upon review, the Supreme Court reversed the district court allowing Wadsworth to recover against the lien release bond and vacated the district court's judgment in favor of Wadsworth. View "Americn Bank v. Wadsworth Golf" on Justia Law

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The plaintiffs in this case appealed the grant of summary judgment upholding the validity of a bank's mortgage in real property that the plaintiffs had sold to a mortgagor in exchange for an interest in an investment account that turned out to be a Ponzi scheme. Plaintiffs filed an action against other parties to their transaction including the Bank of Commerce arguing, among other things, that they were entitled to rescind the sale of a portion of their property for lack or failure of consideration and mutual mistake ("They argue[d] that they did not receive any consideration because the . . . interest in their investment account with the Trigon Group turned out to be worthless. Mr. Harris testified that he 'assumed that was real money, which it later proved out not to be.'"). Finding no error in the district court's judgment, the Supreme Court affirmed the lower court. View "Harris v. Bank of Commerce" on Justia Law

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Two real estate developers, a husband and wife, operated through various entities including a corporation and an LLC. In 2002, the corporation borrowed money from a lender; the developers, in their individual capacities, guaranteed this loan and all future advances. The corporation promptly repaid this loan. In 2005, the LLC twice borrowed money from the same lender. The lender originally insisted on a personal guaranty for these loans, but, in order to secure the developer's business, stated that no personal guaranty would be required. In 2006–07, the corporation again borrowed money from the lender in six separate loans. The corporation defaulted on these six loans, and, after the lender foreclosed on the real estate that served as collateral for the loans, the lender sued the developers for the deficiency. The district court granted the lender's motion for summary judgment, holding that the developers' affirmative defenses (1) were barred by the statute of frauds, (2) failed for lack of consideration, and (3) raised no genuine issues of material fact. The developers timely appealed to the Supreme Court. Upon review, the Court held that the developers' affirmative defenses were neither barred by the statute of frauds nor failed for lack of consideration. However, because none of those defenses raised a genuine issue of material fact, the Court affirmed. View "Washington Federal Savings v. Engelen" on Justia Law

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This was an appeal of a judgment which held that a mechanic’s lien had priority over a mortgage. The judgment was predicated upon the district court's refusal to permit the mortgagee to withdraw an admission made in open court by its counsel that the mechanic's lien was valid. Upon review of the matter, the Supreme Court reversed the district court and held that the mechanic's lien was invalid because the lien did not show that it was verified before a person entitled to administer oaths. View "First Federal Savings Bank of Twin Falls v. Riedesel Engineering, Inc." on Justia Law