Justia Banking Opinion Summaries

Articles Posted in Rhode Island Supreme Court
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RICS executed a note secured by a mortgage on real estate. Meanwhile, TLA entered into a contract with RICS to provide architectural and engineering services for the project and recorded two documents related to its work on the project. Subsequently, TLA filed a petition to enforce its mechanics' lien. No claimant timely entered an appearance in TLA's mechanics' lien litigation to preserve the priority of their claims. Months later, Petra purchased the note and mortgage, which had not been recorded by the previous owner. Meanwhile, the superior court entered a consent order signed by RICS and TLS in the mechanics' lien litigation. RICS subsequently conveyed the property, and the court placed the property into receivership. Petra later filed a motion to file an answer and statement of claim out of time in the mechanics' lien proceedings. The court granted the motion, thereby restoring the mortgage's priority over TLA's mechanics' lien. The property was sold to Petra through a receivership action. The Supreme Court reversed the superior court's grant of Petra's motion, thereby restoring the priority of TLA's mechanics' lien, holding that the motion justice erred in determining that Petra's failure to file a timely statement of claim was the result of "excusable neglect." View "R.I. Constr. Servs., Inc. v. Harris Mill, LLC" on Justia Law

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Mortgage Electronic Registration Systems, as nominee for two lenders (collectively, Plaintiffs), held mortgages on Lot 456. For the property owner's failure to pay his water bill, the Pawtucket Water Supply Board (PWSB) auctioned the lot. PWSB issued a deed conveying the title in the property to Amy Realty. Amy Realty subsequently discovered that the property PWSB had intended to auction had been mistakenly listed as Lot 486 on the tax sale notices and deed. Amy Realty then obtained a corrective deed from the PWSB conveying title to Lot 456. Amy Realty subsequently filed a petition to foreclose on Plaintiffs' rights of redemption in Lot 456. Plaintiffs filed this action seeking to vacate the final decree of disclosure, alleging that the corrective deed changing the lot number from 486 to 456 was invalid and this infirmity rendered the foreclosure decree void. The superior court granted summary judgment for Plaintiffs. The Supreme Court affirmed, holding (1) the corrective deed obtained in this case was null and void because it was not recorded within sixty days of the tax sale; and (2) the final foreclosure decree may be vacated because the tax sale was invalid. View "Mortgage Elec. Registration Sys., Inc. v. DePina" on Justia Law

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Plaintiff borrowed $249,900 from Lehman Brothers Bank to finance the purchase of a home, and he signed an adjustable rate note that evidenced the debt. Plaintiff and his wife (Plaintiffs) then executed a mortgage on the property that secured the loan. Even though the note was made payable to the lender, the mortgage was granted to Mortgage Electronic Registration Systems, Inc. (MERS) as nominee for the lender and the lender's subject and assigns. Plaintiffs subsequently defaulted on the note, and MERS initiated foreclosure proceedings. Plaintiffs subsequently commenced an action seeking to prevent MERS from exercising the power of sale contained in the mortgage, arguing that only a mortgagee was permitted to exercise the power of sale and that MERS was merely a nominee-mortgagee without the authority to foreclose. The superior court denied Plaintiffs' request and entered judgment on behalf of Defendants. The Supreme Court affirmed, holding that MERS had both contractual and statutory authority to foreclose and exercise the power of sale. View "Bucci v. Lehman Bros. Bank, FSB" on Justia Law

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Because Property Owner failed to pay real estate taxes on his property, the Town held a tax sale of Property Owner's property. Buyer purchased the property after Property Owner defaulted on the action. The superior court subsequently granted Buyer's petition to foreclose Property Owner's right of redemption to the property. Subsequently, a judgment was entered declaring the prior tax sale void and vesting the property back to Property Owner. Property Owner then executed a warranty deed conveying the property to his Sister. Concurrently, a stipulation was entered as an order of the superior court vesting title in the property to Buyer. Thereafter, Property Owner and Sister filed the instant action, seeking a declaratory judgment invalidating the stipulation order. The superior court determined that Buyer was the proper record title holder of the property. The Supreme Court affirmed, holding that a superior court judgment cannot "re-vest" title to property back to a prior owner once that owner has been defaulted in a petition to foreclose his right of redemption and a final decree has been entered. View "Medeiros v. Bankers Trust Co." on Justia Law