The Debtor filed Chapter 7 in 1998 and received a discharge shortly thereafter. In 2009, the Debtor commenced litigation in Florida regarding 24,000 shares of SafeCard, Inc. stock, purchased for approximately $120,000.00 in November 1977, upon which the Debtor had never received distributions or dividends. The Debtor had not listed this asset in his petition and accordingly, the Chapter 7 Trustee reopened the case in September 2012, but took no subsequent steps to administer the asset. In April 2013, the Debtor sought to have the lawsuit abandoned pursuant to 11 U.S.C. § 554, asserting that the prosecution of these claims by the trustee would not be economically feasible nor in the best interest of the estate.… Read More
The Debtor had since 1998 complied with the requirements of N.C.G.S. § 105-306 to list for taxes the personal property owned in Wake County. The Debtor was required to file such a disclosure between January 1st and 31st of 2009, but failed to do so, instead filing bankruptcy on February 18, 2009. On September 30, 2009, Wake County subsequently sent the Debtor a notice that it had assessed taxes at a “discovered value” of 125% of the value from the previous year and that the Debtor had, pursuant to N.C.G.S. § 105-312(d), thirty (30) days to contest this value. Neither the Debtor nor the Chapter 7 Trustee challenged this assessment.… Read More
Proposed opinion examines the ethical duties of a lawyer representing both the buyer and the seller on the purchase of a foreclosure property and the lawyer’s duties when the representation is limited to the seller.
Editor’s note: This opinion supplements and clarifies 2006 FEO 3.
Bank A foreclosed its deed of trust on real property and was the highest bidder at the sale. Bank A listed the property. Seller entered into a contract to purchase the property.
An addendum to the Offer to Purchase and Contract (“Contract”) signed by the parties states that the closing shall be held in Seller’s lawyer’s office by a date certain and that Seller, Bank A, “shall only pay those closing costs and fees associated with the transfer of the Property that local custom or practice clearly allocates to Seller … and the Buyer shall pay all remaining fees and costs.” Bank B is providing financing for the transaction.… Read More
Proposed opinion rules that a lawyer/trustee must explain his role in a foreclosure proceeding to any unrepresented party that is an unsophisticated consumer of legal services; if he fails to do so and that party discloses material confidential information, the lawyer may not represent the other party in a subsequent, related adversarial proceeding unless there is informed consent.
Lender requests that Lawyer’s Firm serve as the substitute trustee under a note and deed of trust to commence foreclosure proceedings based on an alleged event of default. Borrower under the note and deed of trust is a limited liability company. While Firm is acting as substitute trustee, Borrower’s member-manager meets with Lawyer and explains to Lawyer why he believes Borrower is not in default.… Read More
Many months after the trustee’s sale of the partnership’s sole asset had already occurred and been
approved by the court, Rahmi, an owner of the debtor, asserted as a reason to invalidate the sale that a conflict of interest had previously arisen, as the Trustee’s law firm was involved in a separate debt collection action against Rahmi.
The 4th Circuit rejected this, holding that, pursuant to 11 U.S.C. § 327, Trustees may, with the court’s approval, to employ attorneys “that do not hold or represent an interest adverse to the estate, and that are disinterested persons, to represent or assist the trustee in carrying out the trustee’s duties.” The debt collection was against Rahmi individually, whereas the assets sold were solely the property of the partnership.… Read More
Randle brought a complaint against the Defendants for violations of the FDCPA and sought certification of her case as class action. Prior to any class certification, the Defendants settled, agreeing to pay $6,000 “in full final settlement of all her claims,” plus attorney’s fees related to her individual claims. Counsel then submitted requests for $89,083.69, which was reduced by the district court to $76,876.59. The Defendants appealled, arguing that the district court abused its discretion because the attorney’s fees awarded failed to consider the lack of success in obtaining a class claim.
The Court of Appeal rejected this argument, recognizing that while a nominal damages award bears on the propriety of fees awarded, See Farrar v.… Read More
In 1986, the Smiths acquired title to Lot #184 of Crestview Subdivision, 106 Crestview Terrace, in Davidson County, Thomasville, North Carolina (“the property”) and recorded the Deed. The Smiths executed a promissory note in the principal amount of $96,000 (“the Note”) to New Century Mortgage Corporation (“New Century”) secured by a Deed of Trust on the property that was recorded on 16 December 2002. The Deed of Trust included the correct address of the property as 106 Crestview Terrace, Thomasville, North Carolina, the legal description attached to the Deed of Trust did not, however, fully and completely describe the property.… Read More
Ussery brought suit against BB&T as a result of a failure to qualify for a government loan, more than six years after a learning of the denial of the loan. The causes of action were subject to a three year Statute of Limitations, but Ussery argued that under a theory of equitable estoppel, BB&T should not be allowed to assert such defense, as it had during the pendency of a lawsuit by Barker, a partner, actively dissuaded Ussery from bringing his own lawsuit earlier.
The elements of equitable estoppel as follows:
(1) As related to the party estopped:
(A) Conduct which amounts to a false representation or concealment of material facts, or, at least, which is reasonably calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the party afterwards attempts to assert;
(B) intention or expectation that such conduct shall be acted upon by the other party, or conduct which at least is calculated to induce a reasonably prudent person to believe such conduct was intended or expected to be relied and acted upon;
(C) knowledge, actual or constructive, of the real facts.… Read More
In this putative class action, prospective luxury home buyers allege that a real estate development company unlawfully refused to return deposits when the prospective buyers could not obtain mortgage financing. Toll Brothers sought to dismiss or stay pending arbitration, but the district court found the arbitration provision to be unenforceable as it only required buyers, and not Toll Brothers, to submit disputes to arbitration.
The Federal Arbitration Act “ is a congressional declaration of a liberal federal policy favoring arbitration agreements”, 9 U.S.C. § 2, and, following AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011), courts were prohibited from altering otherwise valid arbitration agreements by applying the doctrine of unconscionability to eliminate a term barring classwide procedures.… Read More
Mrs. Holliday primarily asserted that the refinance documents, on which Mr. Holliday allegedly forged her signature in granting a Deed of Trust to Cambridge Home Capital (Cambridge), were void ab initio and thus ineffective to transfer an interest in the Hollidays’ property. The Deed of Trust was ultimately assigned to BAC Home Loans. (BAC.)
The Court of Appeals restated that a “deed obtained through fraud, deceit or trickery is voidable as between the parties thereto, but not as to a bona fide purchaser. A forged deed, on the other hand, is void ab initio.” Harding v. Ja Laur Corp., 315 A.2d 132, 135 (Md.… Read More