U.S. Bank National Association N.D. v. Citimortgage, Inc.

October 30, 2014 by Justia

In 2005, Herbert and Julie Thomas opened a $2,000,000.00 home equity line of credit (the HELOC) with U.S. Bank. To secure the obligation, the Thomases executed a deed of trust in favor of U.S. Bank to their property in Sun Valley. A few months later, the Thomases approached Citimortgage, Inc. seeking refinancing. Blaine County Title Associates (BCT) issued a Commitment for Title Insurance under which Stewart Title Guarantee Company agreed to issue a policy to CitiMortgage so long as all prior deeds of trust, including the U.S. Bank Deed of Trust, were released so that CitiMortgage would be in first lien position with regard to the Thomas Property. To that end, BCT contacted the local branch of U.S. Bank in Ketchum to determine the HELOC payoff amount. In response, U.S. Bank faxed BCT a screen shot of an account inquiry reflecting the balance owed on the HELOC. The Thomases closed with Citimortgage a few weeks later, and the Citimortgage loan was secured by a deed of trust on their property. The Citimortgage deed of trust was recorded days later. This appeal arose from a lien priority dispute between U.S. Bank and CitiMortgage. The district court concluded that U.S. Bank lost its first priority position on the Thomas property after finding that CitiMortgage delivered a demand for reconveyance and U.S. Bank failed to release its deed of trust as required by Idaho Code section 45-1514. U.S. Bank appealed, contending that the district court misallocated the burden of proof, that testimony offered by CitiMortgage was inadmissible, and that CitiMortgage failed to prove delivery of the demand for reconveyance. CitiMortgage cross-appealed the district court's decision that CitiMortgage was not entitled to attorney fees and costs. Upon review, the Supreme Court concluded the district court misallocated the burden of proof, that the district court did not err in admitting Citimortgage's proffered testimony, and that it could not determine whether the district court's findings of fact were supported by substantial and competent evidence because the court failed to evaluate certain evidence. As such, the Supreme Court vacated the district court judgment and remanded the case for further proceedings.View "U.S. Bank National Association N.D. v. Citimortgage, Inc." on Justia Law