Justia Real Estate & Property Law Opinion Summaries

Mark Yazdani was the president and sole owner of Meridian Financial Services, Inc. (Meridian). Over the span of a year, Yazdani made a series of investments in an international gold-trading scheme run by a loan broker, Lananh Phan, who promised him “guaranteed” returns of 5 or 6 percent per month. It turned out to be a Ponzi scheme and when it collapsed, Yazdani lost most of his money. In exchange for some of his investments, Yazdani demanded “collateral” from Phan, in the form of "loans" or promissory notes secured by deeds of trust in favor of Meridian on Phan's residence, and the residences of unwitting third parties ensared in Phan's scheme. The loans were facilitated through escrow at Chicago Title Company. The purported borrowers never knew of these transactions; their signatures on the Meridian deeds of trusts were forged or obtained by Phan under false pretenses. Yazdani had been made aware of “irregularities” with the execution and notarization of the Meridian deeds of trust. Yazdani moved to foreclose on the purported borrowers. In one of two lawsuits, two of the purported borrowers sued Yazdani and Meridian (collectively, Appellants) to prevent foreclosure of and quiet title to their home. A judge cancelled the Meridian deeds of trust, finding that they were “forged” and that Appellants had acted with unclean hands in procuring them (the Orange County decision). However, the parties later settled and, as a condition of settlement, obtained a stipulated order from a different judge vacating most of the trial judge’s decision. In this, the second lawsuit, Appellants sued Chicago Title, among others, alleging they were induced to invest with Phan because Chicago Title’s involvement in the transactions reassured them that Phan’s investment scheme was legitimate. Appellants also sued more than 50 individuals who allegedly received payments from Phan, asserting they were Phan’s creditors and the transfers of money to the individuals should be set aside. Summary judgment was entered in favor of Chicago Title and the individuals. Appellants appealed both judgments, contending the trial court erred in giving preclusive effect to the Orange County decision. They also argued the award of attorney fees was an abuse of discretion. Finding no merit to these contentions, the Court of Appeal affirmed the judgments and the fee award. View "Meridian Financial etc. v. Phan" on Justia Law

In 2008, Zito purchased a beachfront house and lot on Nags Head (a barrier island). In 2016, the house burned down. The lot is governed by North Carolina’s Coastal Area Management Act (CAMA): buildings with less than 5,000 square feet must be set back at least 60 feet or 30 times the local rate of erosion, whichever is farther, from the vegetation line. Buildings of less than 2,000 square feet built before June 1979 fall under a grandfather provision, requiring a setback of only 60 feet from the vegetation line. The Zito property qualifies for the grandfather provision but is set back only 12 feet from the vegetation line. In 2018, the coastline by the property eroded at an average rate of six feet per year. Experts indicate that coastal erosion and rising sea levels could cause the property to be underwater by 2024. The permit officer denied Zito’s application to rebuild The Coastal Resources Commission denied a variance, informing Zito of the right to appeal in state superior court.Zito filed suit in federal court, arguing that CAMA’s restrictions amounted to an unconstitutional taking. The Fourth Circuit affirmed the dismissal of the suit. The Commission qualifies as an arm of the state subject to the protection of sovereign immunity; the Eleventh Amendment bars Fifth Amendment taking claims against states in federal court where the state’s courts remain open to adjudicate such claims. View "Zito v. North Carolina Coastal Resources Commission" on Justia Law

The First Circuit affirmed the judgment of the Bankruptcy Appellate Panel for the First Circuit (BAP) affirming the summary judgment entered by the bankruptcy court against the bankruptcy trustee (the Trustee) for an estate of two individuals, holding that an unrecorded mortgage in Puerto Rico is not a transfer of the debtor's property that is voidable by a bona fide purchaser that triggers the bankruptcy trustee's authority to avoid and preserve the lien.Jose Antonio Lopez Cancel and Carmen Nereida Medina Gonzalez acquired a property in Puerto Rico that they used as their primary residence. Banco Popular de Puerto Rico held the mortgage, but the mortgage was never recorded. The bankruptcy court treated the mortgage as a general unsecured claim covered by an earlier discharge order. The Trustee then filed this action to avoid the mortgage and preserve it on behalf of the bankruptcy estate, arguing that the unrecorded mortgage was a transfer of the debtor's property that was voidable by a bona fide purchaser. The bankruptcy court concluded that the Trustee could not avoid and preserve an unrecorded mortgage because, under Puerto Rican law, an unrecorded mortgage is not a property interest. The BAP affirmed. The First Circuit affirmed, holding that there was no error. View "Segarra Miranda v. Banco Popular de Puerto Rico" on Justia Law

The Supreme Court reversed the rulings of the district court on summary judgment invalidating a transfer-on-death (TOD) executed by Wife before her death naming Daughter as the designated beneficiary to her interest in a house titled solely in Wife's name and dismissing Daughter's counterclaim for slander of title, holding that the TOD deed was not invalid.Husband, who died during the course of these proceedings, brought this action alleging that he was the rightful owner of the house at issue because, in part, the TOD deed was invalid because "Nebraska deeds conveying an interest in real property held by a married person must be executed by both spouses." Daughter counterclaimed for slander of title. The court sustained Husband's motion for partial summary judgment, finding that the TOD deed was void as a matter of law for failing to satisfy Neb. Rev. Stat. 40-104. The Supreme Court reversed, holding (1) as a matter of law, section 40-104 does not apply to TOD deeds; and (2) the TOD in this case was not void, and Daughter counterclaim was no longer moot. View "Chambers v. Bringenberg" on Justia Law

The crux of this interlocutory appeal was whether Plaintiffs, complaining of personal injury and property damage as a result of the alleged improper use of an oil-disposal well, had to exhaust their administrative remedies before the Mississippi State Oil and Gas Board (MSOGB) prior to proceeding on their common-law claims in the circuit court. Because the Mississippi Supreme Court determined the MSOGB could provide no adequate remedy for the Baucums’ personal-injury and property-damage claims, the Baucums were not required to exhaust administrative remedies before proceeding in the circuit court. View "Petro Harvester Oil & Gas Co., LLC, et al. v. Baucum" on Justia Law

At issue in this case are the terms of a recorded easement that runs with two beachfront lots in Walton County, Florida. After the County enacted an ordinance purporting to establish the public's right to use the dry-sand area of all beaches for recreational purposes, two beachfront property owners filed suit alleging that the ordinance triggered the easement's abandonment clause.The Eleventh Circuit reversed the district court's grant of summary judgment in favor of the County, holding that the ordinance triggered the abandonment clause and that no other source of law—Florida common law, separate provisions in the easement, a Walton County resolution, or a consent judgment—forestalls or limits the abandonment clause's operation. Accordingly, the court remanded for further proceedings. View "A Flock of Seagirls LLC v. Walton County Florida" on Justia Law

Daniel and Debra Bearce appealed the district court’s grant of summary judgment in favor of Yellowstone Energy Development, LLC. In June 2006, representatives of a business entity that would eventually become Yellowstone went to the home of Daniel and Debra Bearce seeking to purchase 170 acres of land owned by the Bearces. Yellowstone successfully secured an exclusive option to purchase the land. In 2008, Yellowstone exercised its option to purchase the land, and the parties entered into a contract for deed. In 2009, Yellowstone and the Bearces modified the contract for deed to alter some of the payment terms. Both the original contract for deed and the 2009 modified contract for deed included the following term providing for the payment of a portion of the purchase price with “shares” of a contemplated ethanol plant. Yellowstone subsequently abandoned its plan to build an ethanol plant on the Bearces’ land. Yellowstone then negotiated a long-term lease with a third party to build an oil train loading facility on the Bearces’ land. In July 2010, Yellowstone sent a letter to the Bearces advising them $100,000 in “value” would be issued despite Yellowstone’s abandonment of the plan to build an ethanol plant. In December 2011, the Yellowstone Board of Directors approved a multiplier of three units per $1 invested for individuals who had provided initial cash investment in Yellowstone. The Bearces’ interest in Yellowstone was not given the 3:1 multiplier. Units representing ownership interest in Yellowstone were allocated and placed on a ledger sometime after December 4, 2012. After receiving a “unit ledger” indicating their interest in Yellowstone would not receive the 3:1 multiplier, the Bearces objected. Despite the objection, Yellowstone refused to apply the 3:1 multiplier to the Bearces’ interest in Yellowstone. The Bearces sued Yellowstone, asserting claims for breach of fiduciary duty, fraudulent inducement, and breach of contract. On appeal, the Bearces argued the district court erred in concluding Yellowstone did not owe them a fiduciary duty and that, if a duty was owed, the Yellowstone Board of Directors did not breach its fiduciary duty. Finding no reversible error, the North Dakota Supreme Court affirmed the district court. View "Bearce v. Yellowstone Energy Development" on Justia Law

The Second Circuit vacated the district court's grant of summary judgment to plaintiff in a quiet title action regarding a property subject to a mortgage held by the bank. The district court, relying on a statement in Milone v. U.S. Bank, N.A., 164 A.D.3d 145 (2d Dep't 2018), held that U.S. Bank's purported de-acceleration was motivated only by a desire to avoid the expiration of the limitations period and was therefore insufficient to de-accelerate. While this appeal was pending, the New York Court of Appeals, in Freedom Mortgage Corp. v. Engel, 37 N.Y.3d 1 (2021), abrogated the proposition of Milone on which the district court relied. Therefore, this intervening decision undermined the reasoning of the district court. The court remanded for further proceedings. View "53rd Street, LLC v. U.S. Bank National Ass'n" on Justia Law

Lucille Ray sued the City of Rock Hill, South Carolina (the City) for inverse condemnation, claiming her property was taken as a result of stormwater flowing through pipes under City streets and into a terra cotta pipe that ran underneath and behind her property. The circuit court granted summary judgment to the City, and the court of appeals reversed, holding a genuine issue of material fact existed as to whether the City engaged in an affirmative, positive, aggressive act sufficient to support Ray's claim. The South Carolina Supreme Court affirmed the court of appeals (as modified), and remanded the case back to the circuit court for a determination on the merits as to whether the City's reconnection of its three stormwater pipes to the catch basin and the resumed flow of water through the Pipe constituted an affirmative, positive, aggressive act causing damage to the Property over and above any damage that had occurred before the three pipes were severed and reconnected. "Given the posture of this case and the above discussion, Ray cannot recover for any damage to the Property caused by the flow of water though the Pipe before the City reconnected its three pipes to the catch basin in November 2012." View "Ray v. City of Rock Hill" on Justia Law

The Supreme Court accepted a state law question certified by the United States Court of Appeals for the Ninth Circuit regarding whether, under Montana law, parasitic emotional distress damages are available for an underlying negligence claim for personal property damage or loss, answering the question in the negative.After Plaintiffs took their vehicle to Costco's tire center a Costco employee gave the keys to a man who falsely claimed to be Plaintiffs' son. Plaintiffs found their vehicle, but several items had been stolen. Plaintiffs sued, bringing claims of bailment and negligence. In instructing the jury, the district court told jurors that if they found for Plaintiffs on the negligence claim, they must determine the amount of damages to compensate them for any parasitic damages caused. The jury returned a verdict in favor of Plaintiffs. Costco appealed the award for non-property damages, arguing that the verdict was premised on the federal district court's incorrect instruction for consideration of parasitic emotional distress damages arising from the loss of personal property. The Ninth Circuit then certified the question at issue. The Supreme Court answered that parasitic emotional distress damages are not available for an underlying negligence claim for personal property damage or loss. View "Childress v. Costco Wholesale Corp." on Justia Law