New York Federal Court Dismisses Mortgagee’s Complaint and Holds Citizenship of Nominal Defendant MERS Cannot Be Controlling for Diversity Jurisdiction Purposes

In an action filed by plaintiff mortgagee in federal court purportedly under diversity jurisdiction, the United States District Court for the Northern District of New York denied plaintiff’s motion for default judgment and, instead, sua sponte dismissed the complaint for lack of subject matter jurisdiction. 

Supreme Court Holds That Filing of Bankruptcy Claim on Time-Barred Debt Does Not Violate FDCPA

The United States Supreme Court recently held that a creditor who files a bankruptcy claim on a time-barred debt does not violate the Fair Debt Collection Practices Act (“FDCPA”).  See Midland Funding, LLC v. Johnson, 137 S. Ct. 1407 (2017).  In the case, the debtor filed for bankruptcy under Chapter 13 of the Bankruptcy Code, and the creditor filed a proof of claim asserting that it was owed credit card debt.  However, the credit card had not been used in over ten years, outside Alabama’s six-year statute of limitations. 

New York District Court Holds Plaintiff’s Failure To Properly File the Statutorily Required Notice of Pendency Warrants Denial of Motion For Default Judgment

The United States District Court, Northern District of New York, recently denied plaintiff’s motion for default judgment and for judgment of foreclosure and sale of certain property, finding plaintiff’s notice of pendency to be ineffective and, therefore, void.  See Ditech Financial LLC v. Frantz, 2017 WL 1184206 (N.D.N.Y. March 29, 2017).

New York State Court Discharges and Cancels Mortgage Which Plaintiff Sought to Foreclose Due to Plaintiff’s Wrongful Conduct

The Supreme Court of New York, Tompkins County, recently granted the “drastic remedy” of dismissing plaintiff bank’s residential foreclosure action against defendant debtors, cancelling the notice of pendency filed in the action and discharging and cancelling the mortgage which plaintiff sought to foreclose, all because of plaintiff’s “pattern of conduct which gave rise to an inference of willfulness.”

Minnesota Appellate Court Holds Title Insurance Company Not Liable for Boundary Line Dispute Under the Defective Description and Survey Exceptions

In a noteworthy decision for the title insurance industry, the Minnesota Court of Appeals recently held on April 10, 2017 that a title insurance company had no duty to defend its insured in a boundary line dispute when the policy contained defective-description and survey exceptions. See Fischer Sand & Aggregate, LLP v. Old Republic Nat'l Title Ins. Co., 2017 WL 1316130 (Minn. Ct. App. 2017).

New York Supreme Court Dismisses Plaintiff’s Complaint to Foreclose on Tax Liens Against Bona Fide Purchasers For Value, but Finds City Liable for Negligence in Mistakenly Marking the Liens as Satisfied

In an action to foreclose on two tax liens that were assigned to plaintiff, the New York Supreme Court, Westchester County, recently granted defendant purchasers’ motion for summary judgment dismissing plaintiff’s complaint as against them on grounds that they are bona fide purchasers for value, as well as plaintiff’s motion for summary judgment against the defendant city for negligence mistakenly marking the liens as satisfied.

Supreme Court Holds That Cities May Have Standing to Bring Discriminatory Lending Lawsuits Under the FHA for Banks’ Alleged Redlining Practices

In a groundbreaking decision issued Monday, the United States Supreme Court held that a city may have the right to bring an action against a lender for violations of the Fair Housing Act of 1968 (“FHA”) when the lender's allegedly discriminatory lending caused large-scale foreclosures and vacancies in predominantly minority neighborhoods.

California District Court Dismisses Complaint Alleging Wrongful Foreclosure for Lack of Standing on the Ground that a Mistake in Recording Renders an Assignment Void, Not Voidable

The Northern District of California recently granted defendant bank’s motion to dismiss pro se plaintiffs’ complaint alleging wrongful foreclosure on jurisdictional grounds.  See Wyman v. First Am. Title Ins. Co., 2017 WL 512869 (N.D. Ca. Feb. 8, 2017).  In the case, plaintiffs obtained a loan from defendant bank secured by a deed of trust on plaintiffs’ residence.