Justia Civil Procedure Opinion Summaries

Le Papillon Homeowner’s Association Inc. sought to collect homeowners’ association fees from Loblolly Properties LLC for the nine lots it owned in the Le Papillon development. Loblolly argued that it did not have to pay HOA fees because a nonjudicial foreclosure sale extinguished all restrictive covenants on the subject lots. The trial court disagreed, finding that the covenants were on record when Loblolly purchased the subject lots in the Le Papillon property. The trial court also held that Loblolly’s Special Warranty Deed’s language clearly stated that the “conveyance and the warranty hereof is subject to any and all Covenants and Restrictions of record.” The trial court later granted summary judgment for Le Papillon. Loblolly appealed, raising two issues: (1) whether the foreclosure sale made the covenants and restrictions not binding, despite the language of the Special Warranty Deed; and (2) whether the foreclosure extinguished the covenants and restrictions. The Court of Appeals affirmed the judgment of the trial court, holding that Loblolly was bound to the covenants through the language in the Special Warranty Deed and that the foreclosure did not extinguish the covenants and restrictions. Upon a review of the record and law in this state, the Mississippi Supreme Court affirmed the trial and appellate courts. View "Loblolly Properties LLC v. Le Papillon Homeowner's Association Inc." on Justia Law

Plaintiffs AZNH Revocable Trust (AZNH) and John and Susan Sullivan, trustees, appealed a superior court order denying their request for preliminary injunctive relief against defendant Spinnaker Cove Yacht Club Association, Inc. (the Association), and granting the Association’s motion to dismiss. Spinnaker Cove Yacht Club (Spinnaker Cove) is a condominium consisting of ninety-one units and common area. Appurtenant to each unit is the exclusive right to use a boat slip corresponding to that unit. The Association was an organization created to manage and control Spinnaker Cove. Plaintiffs requested the court to enjoin the Association “from expending assessment monies or incurring any debt to purchase land outside the Condominium.” They also sought declarations that the condominium instruments of Spinnaker Cove and New Hampshire law prohibited the Association from both “expending assessment monies or incurring any debt to purchase land outside the Condominium to add guest parking spaces” and “expanding the Condominium.” The court reasoned that “[b]ecause the Condominium Act allows the Association to purchase land, and the Declaration does not prohibit same,” the plaintiffs’ complaint “fails to state a claim as a matter of law.” The New Hampshire Supreme Court concurred with the trial court's conclusion and affirmed. View "AZNH Revocable Trust & a. v. Spinnaker Cove Yacht Club Association, Inc." on Justia Law

Two cases consolidated for the Michigan Supreme Court's review involved premises liability, specifically slip-and-fall instances where plaintiffs both argued while the hazards were open and obvious, they were unavoidable. In Case No. 162907, Ahlam Kandil-Elsayed filed a negligence action based on premises liability after she slipped and fell at a gas station defendant F & E Oil, Inc. operated. Plaintiff argued snow and ice on the premises constituted a dangerous condition. In Case No. 163430, Renee Pinsky tripped over a cable that had been strung from a checkout counter to a display basket at a local Kroger supermarket. In both cases, defendants moved for summary judgment arguing that because the hazards were open and obvious and no special aspects were present, they owed no duty of care to plaintiffs. The trial court granted defendant's motion in the former case, but denied defendant's motion in the latter case. The respective losing parties appealed to the Supreme Court. The Supreme Court reversed summary judgment in both cases: although defendants in both cases owed a duty to the respective injured plaintiffs, there remained genuine issues of fact that were relevant to whether the defendants breached that duty and if so, whether plaintiffs were comparatively at fault and should have their damages reduced. The judgments of the Court of Appeals were reversed, and both cases were remanded for further proceedings. View "Kandil-Elsayed v. F & E Oil, Inc." on Justia Law

The plaintiffs brought this action after the defendant modified a storm water drainage system, allegedly causing flooding onto their property. The plaintiffs raised two distinct claims that remained at issue on appeal: a claim under the sewage-disposal-system- event (SDSE) exception to governmental immunity under the governmental tort liability act (GTLA), and a common-law trespass-nuisance claim seeking injunctive relief. The trial court dismissed both claims as untimely under the applicable three-year statute of limitations. Like the Court of Appeals, the Michigan Supreme Court disagreed, holding the SDSE claim, which sought relief only in connection with flooding that occurred within the three-year window, was timely. However, unlike the Court of Appeals, the Supreme Court concluded that because the defendant was immune with respect to the plaintiffs’ common-law trespass-nuisance claim, that claim was properly dismissed. In light of this holding, the Court vacated as unnecessary the Court of Appeals’ holding that the trespass-nuisance claim was timely. Finally, because the plaintiffs only sought injunctive relief in connection with that claim, their request for an injunction was invalid. Therefore, the Supreme Court reversed the trial court’s grant of summary judgment to the defendant with respect to the plaintiff’s SDSE claim, affirmed with respect to the common-law trespass-nuisance claim, and remanded for further proceedings. View "Sunrise Resort Association, Inc. v. Cheboygan County Road Commission" on Justia Law

Defendant Union Mutual Fire Insurance Company appealed a superior court grant of summary judgment to plaintiff CC 145 Main, LLC, in a declaratory judgment action regarding the interpretation of an insurance policy exclusion. CC 145 Main owned an apartment building and purchased a “Businessowners Coverage” insurance policy that included “all risk” property insurance, which provided that Union Mutual would “pay for direct physical loss of or damage to” the covered property, unless coverage was specifically limited or excluded by the policy. The insured property sustained damage when a tenant poured cat litter down a toilet, clogging an interior pipe and causing water to overflow from a shower and toilet. The property required significant cleaning and repair, and tenants were required to temporarily relocate. CC 145 Main filed a claim with Union Mutual for water damage, which Union Mutual denied pursuant to a provision in the insurance policy excluding coverage for damage caused by “[w]ater that backs up or overflows or is otherwise discharged from a sewer, drain, sump, sump pump or related equipment.” CC 145 Main filed a complaint seeking a declaration that the water exclusion does not apply to its claim. Union Mutual filed a motion for summary judgment, arguing that the damage at issue was caused by water that overflowed from “drains” within the meaning of the exclusion. The trial court concluded it was unclear whether the word “drain” in the water exclusion applied to shower and toilet drains and, therefore, the water exclusion was ambiguous and had to be construed in favor of CC 145 Main. Defendant challenged the trial court’s ruling that the policy’s water damage exclusion was ambiguous and its decision to construe the policy, therefore, in favor of CC 145 Main. But finding no reversible error, the New Hampshire Supreme Court affirmed the trial court. View "CC 145 Main, LLC v. Union Mutual Fire Insurance Company" on Justia Law

Gary and Jeanette Merritt own four residential properties in Marysville, Washington. Between 2005 and 2007, the Merritts opened five home equity lines of credit (HELOCs), executing five five promissory notes (notes or HELOC agreements) in favor of USAA Federal Savings Bank. The Merritts secured these loans by executing deeds of trust on the properties with USAA as the beneficiary. In November 2012, the Merritts filed for Chapter 7 bankruptcy. The Merritts stopped making their monthly payments on the USAA loans prior to the November 2012 bankruptcy filing. USAA never accelerated any of the loans or acted to foreclose on the properties. In 2020, the Merritts filed four quiet title complaints seeking to remove USAA’s liens on each of the properties. Relying on Edmundson v. Bank of America, NA, 378 P.3d 272 (2016), the Merritts argued that the six-year statute of limitations to enforce the deeds of trust expired six years after February 12, 2013, the day before their bankruptcy discharge. In October 2020, the Merritts moved for summary judgment in each case. In November 2020, the trial court denied each of these motions. In February 2021, USAA moved for summary judgment in each case. USAA argued that the plaintiffs were not entitled to quiet title because the statute of limitations to foreclose on the deeds of trust would not begin to run until the maturity date of each loan, the earliest of which will occur in 2025. The Court of Appeals affirmed the trial court, holding that the the six-year statute of limitations had not begun to run on enforcement of the deeds of trust since none of the loans had yet matured. The issue this case presented for the Washington Supreme Court's review was whether a bankruptcy discharge triggered the statute of limitations to enforce a deed of trust. The Court affirmed the Court of Appeals and the trial court and hold that bankruptcy discharge did not trigger the statute of limitations to enforce a deed of trust. View "Merritt v. USAA Federal Savings Bank" on Justia Law

The property at issue in this case was a residential home that was purchased in 2007 by Shawn and Stephanie Kurtz. The house was located in a subdivision, which required property owners to pay homeowners association (HOA) assessments to petitioner Copper Creek (Marysville) Homeowners Association. If the assessments were not paid, then Copper Creek was entitled to foreclose on its lien. However, Copper Creek’s lien was “subordinate to any security interest perfected by a first deed of trust or mortgage granted in good faith and for fair value upon such Lot.” The Kurtzes stopped paying their HOA assessments and the home loan in varying times in 2010. The Kurtzes (in the process of divorcing) individually filed for bankruptcy. Neither returned to the house, nor did they make any further payments toward their home loan or their HOA assessments. However, there was no attempt to foreclose on the deed of trust. As a result, the house sat vacant for years and fell into disrepair. The Kurtzes remained the property owners of record and HOA assessments continued to accrue in their names. In 2018, Copper Creek recorded a notice of claim of lien for unpaid HOA assessments, fees, costs, and interest. In January 2019, Copper Creek filed a complaint against the Kurtzes seeking foreclosure on the lien and a custodial receiver for the property. The issue this case presented concerned the statute of limitations to foreclose on a deed of trust securing an installment loan after the borrower receives an order of discharge in bankruptcy. As detailed in Merritt v. USAA Federal Savings Bank, No. 100728-1 (Wash. July 20, 2023), the Washington Supreme Court held that a new foreclosure action on the deed of trust accrues with each missed installment payment, even after the borrower’s personal liability is discharged. Actions on written contracts are subject to a six-year statute of limitations. Therefore, the nonjudicial foreclosure action on the deed of trust in this case was timely commenced as to all unpaid installments within the preceding six years, regardless of the borrowers’ bankruptcy discharge orders. In addition, the Court held the trial court properly exercised its discretion to award fees as an equitable sanction for respondents’ litigation misconduct. View "Copper Creek (Marysville) Homeowners Ass'n v. Kurtz" on Justia Law

Show Me State Premium Homes wants its purchase of a foreclosed property to be free and clear of all other interests, including those belonging to the United States. Getting what it wants would require a “judicial sale.” After removing the case the United States filed a motion to dismiss. Its position was that there could be no foreclosure without a judicial sale. The district court agreed, declined to exercise supplemental jurisdiction over what remained, and remanded to state court.   The Eighth Circuit affirmed the judgment of the district court but modified the dismissal of the ejectment and damages claims to be without prejudice. The court explained that a buyer’s interest is only “inchoate” before it gets a valid deed, not after. And here, title vested once the bond company “exercised its right to have the legal title transferred.” No “judicial sale” ever took place, and it is too late to hold one now, meaning that the interests held by the United States have never been foreclosed. View "Show Me State Premium Homes, LLC v. George McDonnell" on Justia Law

Marvin and Mildred Bay (“the Bays”) challenged a court order dismissing their trespass claim against Anadarko E&P Onshore LLC and Anadarko Land Corporation (collectively, “Anadarko”). Anadarko, an oil and gas company, owned the mineral rights under the Bays’ farm. The Bays brought a putative class action along with other surface landowners against Anadarko, alleging that Anadarko’s mineral lessees had exceeded the scope of their mineral rights by drilling multiple vertical wells on the surface owners’ land when it was possible to drill fewer wells of the “directional” type. At the conclusion of the Bays’ presentation of evidence, the district court found that the Bays’ evidence failed as a matter of law to demonstrate that Anadarko’s activities amounted to a trespass and dismissed the case. Finding that the district court applied the wrong legal standard, the Tenth Circuit reversed the dismissal in "Bay I," finding that Colorado’s common law of trespass required the Bays to show that Anadarko’s lessees had “materially interfered” with the Bays’ farming operations. The appellate court questioned whether the record demonstrated that the Bays met this standard in their trial, but because Anadarko had not raised this specific issue, the case was remanded to the district court for further proceedings. On remand, the district court again granted judgment as a matter of law to Anadarko on the material interference issue. Specifically, the court first held that it was bound by the Tenth Circuit's interpretation in Bay I of the material interference standard, then found that the Bays showed only that Anadarko’s conduct inconvenienced them—which was insufficient to satisfy the material interference standard. The Bays again appealed, arguing that the Tenth Circuit's discussion of the material interference standard in Bay I was dictum; thus, the district court incorrectly determined that it was bound to apply that standard. They further argued the material interference standard applied by the district court was inconsistent with the Colorado standard for trespass outlined in Gerrity Oil & Gas Corp. v. Magness, 946 P.2d 913 (Colo. 1997), and that the evidence they presented in their trial established a prima facie case of material interference under Gerrity. The Tenth Circuit determined the district court did not err in its second dismissal and affirmed judgment. View "Bay, et al. v. Anadarko E&P Onshore, et al." on Justia Law

Reyes Galvan and Minhwa Kim sued Yam Foo Poon, Hwai-Tzu Hong Poon, and Daniel Poon alleging fraud, misrepresentation, fraudulent concealment, silent fraud, innocent misrepresentation, loss of consortium, and breach of a warranty deed. In 2017, plaintiffs bought a condominium in Ann Arbor from defendants, and defendants transferred title to plaintiffs via a warranty deed. The deed warranted, among other things, that pursuant to MCL 565.151, the property was “free from all incumbrances.” While renovating the condominium, plaintiffs learned of several issues with the property, including that there was no proper firewall between their condo and the neighboring units, and that one of the defendants had signed a unit-modification form indicating that a wall had been moved and that a neighboring unit encroached on the upstairs bathroom of plaintiffs’ unit. Because the absence of a firewall violated the city’s building code, the City of Ann Arbor sued plaintiffs and their adjoining neighbors to enforce the code and require installation of firewalls. Plaintiffs were ordered to pay $18,000, in part to bring the walls of their unit into compliance with the building code, and they also spent additional funds to remediate other problems with the property. During a jury trial, defendants moved for a directed verdict on plaintiffs’ breach-of-warranty claim, arguing that the building code violations were not an encumbrance. The trial court agreed and directed verdict in favor of defendants on this claim. The jury subsequently found in favor of plaintiffs regarding their claims of silent fraud and loss of consortium. Galvan appealed the directed verdict, and the Court of Appeals reversed, finding the building code violations constituted an encumbrance in violation of the warranty deed. The Michigan Supreme Court reversed, finding that a violation of a building code at the time of sale, not yet subject to any official enforcement action, was not an encumbrance. View "Galvan v. Poon" on Justia Law