Reserve Homeowners Association commenced a foreclosure against residential rental property owned by Ms. Ackah for unpaid homeowner’s association dues. Notice of the sale was left at the property and notices sent (and returned unclaimed) to other family members. Ultimately, the property was purchased by the Jones Family Holdings a the sale. Finding that Ms. Ackah did not receive actual notice of the foreclosure , the superior court accordingly set aside the sale.
The majority of opinion of the Court of Appeals held that N.C.G.S. § 1A-1, Rule 4 did require the HOA to use “due diligence” in effectuating service. Since the HOA knew or had reason to know that Ms.… Read More
After the death of her Melvin Clayton, Wells Fargo accelerated the reverse mortgage note and sought to foreclose on the residence still owned by Mrs. Clayton. The Court of Appeals held that even though Mrs. Clayton was identified as a “borrower” on the Deed of Trust, Melvin Clayton was “the only contemplated borrower to the reverse-mortgage agreement, as he alone executed [those] documents and was obligated under them.” Mrs. Clayton was, due to her age, ineligible to be a borrower under the reverse mortgage, which, pursuant to N.C.G.S. § 53-257(2), must be 62 years of age or older.
The successor in interest rules under the Dodd-Frank Act would not apply here, as this is a reverse mortgage.… Read More
In previously ruling on the foreclosure by power of sale on this property, the North Carolina Supreme Court upheld that foreclosure, finding that the Deed of Trust contained a sufficient description to identify the real property. See In re Foreclosure of a Deed of Trust Executed by Reed, 233 N.C. App. 598, 758 S.E.2d 902, 2014 N.C. App. LEXIS 381 (2014). Subsequently, but before the foreclosure sale was completed, Mr. Howse and Ms. Reed brought a separate suit in Superior Court, raising equitable grounds to enjoin the foreclosure. Bank of America successfully argued that this was an impermissible collateral attack on the foreclosure by power of sale.… Read More
Melvin Clayton obtained a reverse mortgage, granting a Deed of Trust against his home. His wife, Jackie, was ineligible for the reverse mortgage (presumably because she was not old enough), so did not sign the note, but did sign the Deed of Trust. The note included a provision that accelerated the debt upon his death, unless a “surviving borrower” continued to reside in the home. Upon Melvin Clayton’s death, Wells Fargo sought to foreclose.
The Court of Appeals held that as N.C.G.S. § 53-257(2) defines a borrower in a reverse mortgage to be 62 years of age or older, Jackie Clayton was not a “surviving borrower”, the acceleration was proper.… Read More
As part of its Chapter 11 reorganization Bally Total Fitness of the Mid-Atlantic assumed a lease with Friday Investment, which had originally included a guaranty by Bally Holding. When Bally Mid-Atlantic later defaulted, Friday Investments sought to enforce the guaranty against Bally Holding. Bally asserted that while the lease had been assumed, the guaranty was discharged.
In a divided opinion, the majority of held that under North Carolina law a guaranty is a separate contract from the underlying obligation, Tripps Rests. of N.C., Inc. v. Showtime Enters., Inc., 164 N.C. App. 389, 391, 595 S.E.2d 765, 767 (2004), with “[t]he strict independence of the two separate contracts is “not affected by the fact that both contracts are written on the same paper or instrument or are contemporaneously executed.” There remained, however, a genuine issue of material fact whether the guaranty was “required to be maintained” by the assumption or discharged.… Read More
Mr. Weiss, together with his business partner, purchased land for development in Charlotte by obtaining a $28,290,000 loan from GECMC 2006-C1 Carrington Oaks, LLC (“Carrington Oaks”) conditioned, in part, on their personal guaranties. After the loan defaulted, Carrington Oaks brought suit for payment against Mr. Weiss.
At trial, however, Mr. Weiss testified that he had retained the Dreier Law Firm to execute documents for different real estate transactions, including the Carrington Place deal, often signing between thirty and forty signature pages each time went to the Dreier offices. He alleged that one of these signature pages was attached to the guaranty, which he otherwise was not aware, denying specifically signing and executing such.… Read More
The IRS recorded two tax liens against real property and subsequently the Village of Sugar Mountain (“the Village”) obtain a third lien against the property for local property taxes. The Village ultimately sought to foreclose on its tax lien, but did not, despite the requirement in 26 U.S.C. § 7425(a), give notice to the federal government of the sale. The property was sold on November 13, 2013, in a judicial tax foreclosure for $6,673.73 to the Village. The following day, November, 14, 2013,the property was sold at a federal tax foreclosure to Mr. Henkel for $172,000.00. At that second foreclosure, the Village agreed to assign its interest in the property to Mr.… Read More
Following the disclosure in more than 4,200 Proofs of Claim by Wake Med of personal identifying information, several Debtors sought sanctions for violations of Federal Rule of Bankruptcy Procedure 9037, HIPAA, and 11 U.S.C. §107.
The bankruptcy court held that it was not a “HIPAA compliance tribunal” and might not have jurisdiction to decide such claims. Further, “[t]he case law overwhelmingly holds that there is no private right of action under HIPAA or §107 ”, leaving Rule 9037 as the primary remedy. Where, however, ““it was shown that a creditor flaunted the law with knowledge of its proscriptions, failed to take remedial action once violations were discovered, or acted deliberately as opposed to mistakenly or inadvertently”, Carter v.… Read More
While factually complicated, this case presents two issues of first impression under North Carolina law, first regarding the interpretation of the term “transfer” the North Carolina Uniform Voidable Transactions Act, N.C.G.S. § 39-23.9, and secondly, whether this is a statute of limitations or repose.
The Court of Appeals held that based on both the plain language of the statute and the legislative history, the term “transfer” refers to the actual date on which an asset was transferred, rather than the date when its fraudulent nature became apparent to a creditor.
Further, and that the statute is one of repose and not limitation.… Read More