Developer intended to develop real property into single-family residential lots and secured financing through Bank. Insurer provided a surety bond to the Planning and Zoning Commission. Insurer executed three Bond Agreements as surety for Developer. Developer later defaulted in its loan. In lieu of foreclosure, Developer deed the property to Bank’s property management company. Bank transferred the property to another internal holding company. The Commission subsequently complied with Bank’s request for the Commission to call Developer’s bonds and place the proceeds in escrow for the purpose of reimbursing Bank for completion of the necessary infrastructure projects required by Developer’s approved plat. Developer filed a declaratory judgment action alleging that the bonds were not callable and that payment on the bonds would result in Bank receiving an unjust enrichment. The trial court granted summary judgment for Defendants. The Supreme Court affirmed, holding (1) Developer was liable under the bond; and (2) Developer’s claims of error during discovery were unavailing. View "Furlong Development Co. v. Georgetown-Scott County Planning & Zoning Commission" on Justia Law
This case required the Supreme Court to determine whether Appellee, Mortgage Electronic Registration Systems, Inc. (MERS) had "good cause" for failing to timely release a satisfied real estate lien it held on Gary and Sharon Hall's property. The circuit court concluded that the Halls were not entitled to statutory damages because, although MERS filed a release referencing the wrong mortgage, the Halls provided insufficient notice to MERS of the release's actual deficiency. Thus, the court found MERS had "good cause" not to file a new release once it checked and found it had already filed one. The court of appeals affirmed. The Supreme Court affirmed, holding that MERS satisfied the "good cause" requirement under these particular circumstances. View "Hall v. Mortgage Elec. Registration Sys., Inc." on Justia Law
This case presented the question of whether the doctrine of equitable subrogation may be used to reorder the priority of a mortgage lien where the mortgage holder had constructive but not actual knowledge of a pre-existing lien when it paid off an earlier mortgage as part of a refinancing deal and there was no fraud or other misconduct that would have prevented the discovery of the lien. The trial court applied the doctrine to reorder the priority of liens. The court of appeals reversed, finding that the doctrine did not apply under the facts of this case. The Supreme Court affirmed, holding that because equitable subrogation is not available to a lienholder who has actual or constructive knowledge of a preexisting lien, the court of appeals was correct in concluding that the remedy was not available to the mortgage holder. View "Mortgage Elec. Registration Sys., Inc. v. Roberts" on Justia Law
This case arose from a consolidated appeal. In the underlying cases, the respective property owners failed to satisfy their debt obligations to professional lending institutions, which precipitated the foreclosure proceedings. In both cases, the professional lenders asserted that their respective mortgages were superior to the general tax liens filed pursuant to Ky. Rev. Stat. 134.420(2). The circuit court entered a judgment granting the professional lenders' liens priority over the other liens. The court of appeals determined that the circuit court had erred in reordering the priorities and reversed the judgment. The Supreme Court affirmed the court of appeals, holding (1) the prior-recorded section 134.420(2) tax liens enjoyed priority pursuant to the long established first-to-file doctrine; and (2) the doctrine of equitable subrogation does not act to relieve a professional lender of a negligent title examination.