Justia Real Estate & Property Law Opinion Summaries

In 1996, Dominion, a power company, replaced coal burners in two of its plants, temporarily removing the units from service for two to three months. During that time, Dominion incurred interest on debt unrelated to the improvements. On its tax returns, Dominion deducted some of that interest. The IRS disagreed, citing Treasury Regulation 1.263A-11(e)(1)(ii)(B), as requiring Dominion to capitalize half ($3.3 million) of that interest over several years, instead of deducting it in a single tax year. The Claims Court granted summary judgment to the IRS. The Federal Circuit reversed. The associated property rule in Treasury Regulation 1.263A-11(e)(1)(ii)(B), as applied to property temporarily withdrawn from service, is not a reasonable interpretation of the Tax Reform Act of 1986, I.R.C. 263A (Capitalization and Inclusion in Inventory Costs of Certain Expenses). Treasury acted contrary to 5 U.S.C. 706(2) in failing to provide a reasoned explanation when it promulgated that regulation.

After Decedent's will was admitted to probate in the probate court, the Bureau of TennCare filed a claim against her estate seeking reimbursement for services provided through the TennCare program. Decedent's personal representative filed an exception to this claim. The probate court upheld TennCare's claim, and the Estate appealed. The circuit court determined that Decedent's real property was not subject to TennCare's claim. TennCare appealed. The court of appeals vacated the circuit court's judgment and affirmed the probate court, holding that the circuit court lacked subject matter jurisdiction over the appeal from the probate court and that the appeal should have been filed with the court of appeals. The Supreme Court affirmed, holding (1) the circuit court lacked jurisdiction over the Estate's appeal from the probate court's judgment regarding TennCare's claim; and (2) the real property owned by Decedent at the time of her death was subject to TennCare's claims for reimbursement.

Appellants, owners of a tract of real property in Dawson County, filed a nine-count complaint against appellees challenging a rezoning decision in superior court. The superior court granted summary judgment to appellees on three of the nine counts and appellants subsequently filed three direct appeals to the court. The court initially dismissed the appeals by order for failure to comply with the discretionary appeal procedures of OCGA 5-6-35. On appellants' motion for reconsideration, however, the court reinstated the appeals and directed the parties to brief whether OCGA 5-6-35(a)(1) applied. Having had the benefit of full briefing and oral argument on the issue, the court concluded that these appeals came under OCGA 5-6-35(a)(1) and so the court dismissed them again.

After the State Tax Commissioner (Tax Department) appraised Century Aluminum of West Virginia's aluminum plant, Century Aluminum objected to the valuations. The Jackson County Commission sitting as a Board of Equalization and Review advised the company that it would not make any adjustment to the Tax Department's valuations. The circuit court affirmed. The Supreme Court affirmed, holding that the circuit court did not err in (1) upholding the Tax Department's policy of how it considers functional obsolescence and economic obsolescence for categories of assets other than machinery and equipment; and (2) ruling that the Tax Department's policy of artificially limiting its consideration of obsolescence to a fifty percent reduction in the case of machinery and equipment complied with the requirement that property be valued at fair market value.

Several lot owners appealed from a judgment entered in the superior court finding that they were not entitled to form a road association pursuant to Me. Rev. Stat. 23, 3101 and were bound by certain restrictive covenants to pay an annual maintenance fee to Pine Springs Road and Water, LLC (PSRW) for subdivision road maintenance. The Supreme Court vacated the superior court, holding (1) the lot owners were authorized to establish a statutory road association pursuant to section 3101; and (2) the lot owners were not obligated to pay PSRW or its predecessor an annual road maintenance fee under the restrictive covenants. Remanded.

The United States Court of appeals asked the court to answer a question that stemmed from a dispute over the proper interpretation under Georgia law of a contract insuring real property. The primary issue presented was whether the court's ruling in State Farm Mut. Auto. Ins. Co. v. Mabry, a case involving an automobile insurance policy wherein the court held that a provision requiring the insurer to pay for loss to the insured's car required the insurer to also pay for any diminution in value of the repaired vehicle, was applicable. The court held that its ruling in Mabry was not limited by the type of property insured, but rather spoke generally to the measure of damages an insurer was obligated to pay.

This case concerned a summary judgment granted by the district court in favor of the Plaintiff-Appellee RAHI Real Estate Holdings, LLC, against the Defendants-Appellants Vincent and Leslie Adams. The original plaintiff, Residential Funding Real Estate Holdings, LLC, filed a petition to foreclose in 2009, claiming Appellants defaulted on their note. Residential attached a copy of the subject note and mortgage to the petition. The note has a special indorsement from Gateway which states "Pay to The Order Of: Option One Mortgage Without Recourse." Also attached to the note was a blank indorsement by Option One Mortgage Corporation. The district court granted a motion to substitute RAHI as plaintiff in place of Residential in this foreclosure action and ordered that the caption be modified to reflect RAHI as plaintiff. One day after the order granting substitution, Residential as plaintiff filed its first amended petition. Defendants filed their answer admitting that a note and mortgage were executed but denied that the note and mortgage attached to the petition are the ones they signed. Further, they denied default and demanded strict proof. Appellants also attacked plaintiff's standing and the subject matter jurisdiction of the court. Appellee filed a motion for summary judgment alleging there is no controversy as to any material facts and attached an affidavit. Upon review, the Supreme Court found that there was no transcript of a June 29, 2010 hearing in the record, so the Court could not determine what evidence was presented, including any concerning whether or not the substitution of parties gave Option One Mortgage and Option One Mortgage Corporation the right to enforce the note. It did appear from the filed record that there was at least one issue of material fact and summary judgment was inappropriate. Accordingly, the Court reversed the grant of summary judgment and remanded the case for further proceedings.

Defendant Vaillancourt Tree and Landscape Service appealed a trial court decision denying its post-trial motion for attorney's fees and costs under a theory of implied indemnification.  The issue on appeal was whether indemnity for attorney's fees is appropriate where a jury has found the putative indemnitor not liable in the underlying suit. Plaintiff Leonard Knappmiller owns a commercial property directly abutting a property owned by Defendants Joseph and Carolyn Bove.  This case grew from a dispute between Knappmiller and the Boves regarding the Boves' decision to cut down and remove a row of white cedar trees that allegedly straddled their property line.  The Boves hired Vaillancourt to cut and remove the trees.  Following the removal, Knappmiller filed a claim against the Boves for wrongful cutting of trees, alleging that the trees were located on Knappmiller's property and were removed without his consent.  Knappmiller later amended his complaint, adding Vaillancourt as a codefendant.  Vaillancourt consequently cross-claimed against the Boves for negligence, breach of contract, and indemnity.  Vaillancourt's cross-claim alleged that it had entered into a contract with the Boves, and that the Boves did not, but should have, informed Vaillancourt about tree ownership issues with Knappmiller before the trees were cut down and removed.  Vaillancourt's cross-claim demanded "judgment against the Boves . . . for indemnity, if Vaillancourt is found liable to Plaintiff and for any other damages suffered by Vaillancourt resulting from the Boves' negligence and breach of contract." Upon review, the Supreme Court affirmed the trial court: "[e]ven if [the Court] were to dispense with a requirement of finding fault on behalf of the Boves, the jury specifically found neither the Boves nor Vaillancourt liable for any wrongful act.  The jury did not reach Vaillancourt's cross-claim against the Boves because Vaillancourt requested attorney's fees only if Vaillancourt was found liable in the underlying suit.  More importantly, Vaillancourt did not object to the jury charge or the special verdict form -- both of which unequivocally instructed the jury to reach Vaillancourt's indemnity claim only if Knappmiller prevailed.  [The Court] therefore cannot discern any support for an award of attorney's fees, other than Vaillancourt's conclusory allegations that the Boves knew the trees straddled the boundary line and had a duty to inform Vaillancourt of that fact."

Christa Albice and Karen Tecca (hereinafter Tecca) inherited the property at issue in this case. In 2003, Tecca borrowed $115,500 against the property. The loan was serviced by Option One Mortgage Corporation (Option One), and Premier Mortgage Services of Washington (Premier) acted as the trustee. In 2006, Tecca defaulted on the loan and received a notice of trustee's sale. In July 2006, Tecca negotiated and entered into a forbearance agreement to cure the default. The trustee's sale originally set for September 8, 2006 was continued six times. Each continuance was tied to the payments Tecca made under the Forbearance Agreement. The foreclosure sale finally took place on February 16, 2007. Through an agent, Petitioner Ron Dickinson, successfully bid on the property. Tecca first learned the property was sold when Dickinson told Tecca they no longer owned it and needed to leave. Dickinson then filed an unlawful detainer action and sought to quiet title. Tecca countersued, seeking to quiet title in an action to set aside the nonjudicial sale. Tecca also brought suit against Option One and Premier, but the trial court dismissed the action based on an arbitration clause. Dickinson moved for summary judgment to establish that he was a BFP and entitled to quiet title. Tecca also moved for summary judgment, arguing the foreclosure sale should have been set aside because the sale occurred after the statutory deadline and Premier was not a qualified trustee with authority to conduct the sale. The trial court granted Dickinson's motion, ruling that Dickinson was a BFP and despite procedural noncompliance by the trustee. Following trial, the court concluded Premier was authorized to act as the trustee, quieted title in Dickinson, and awarded Dickinson damages. Tecca appealed. The Court of Appeals reversed, setting the sale aside. The Supreme Court affirmed the Court of Appeals: the nonjudicial foreclosure proceedings were "marred" by repeated statutory noncompliance. The financial institution acting as the lender also appeared to be acting as the trustee under a different name; the lender repeatedly accepted late payments and, at its sole discretion, rejected only the final late payment that would have cured the default; and the trustee conducted a sale without statutory authority. The Court concluded the sale was invalid.

This foreclosure action involved a dispute between two creditors, Wells Fargo Financial South Dakota, Inc. and Highmark Federal Credit Union about the priority of their respective mortgage liens against a property. Both parties asserted that they were entitled to first priority. The trial court found that, despite Highmark's statutory priority, under the doctrine of equitable subrogation, Wells Fargo was entitled to first priority. The Supreme Court reversed, holding (1) equity in this case did not require the trial court to pierce the South Dakota recording statutes; and (2) because Highmark filed its lien on the property prior to Wells Fargo, Highmark had priority.