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Court rules on post-merger bank foreclosure rights

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The Indiana Court of Appeals ruled that a federal statute provides the authority for a bank that survives after a merger to enforce the promissory note and mortgage established by a predecessor bank.

In CFS, LLC and Charles Blackwelder v. Bank of America, Successor in Interest to LaSalle Bank Midwest National Association, No. 29A02-1105-MF-436, the Indiana Court of Appeals affirmed a ruling by Hamilton Circuit Judge Paul Felix that granted summary judgment in favor of Bank of America.

The case involves a promissory note and construction mortgage that CFS obtained in June 2007 in exchange for a $982,500 loan from LaSalle Bank Midwest National Association. Christopher Blackwelder executed a personal guaranty of the debt, but in August 2004 Bank of America – which had merged with and was a successor-in-interest to LaSalle – filed a mortgage foreclosure complaint alleging the loan was in default. CFS admitted to the debt but asserted it didn’t have any knowledge of the merger or Bank of America’s role as successor and right to collect the balance.

Bank of America moved for summary judgment on grounds that it had merged and had the authority to collect the debt or foreclose, and after a December 2010 hearing the trial judge took the matter under advisement. He initially declined summary judgment after the bank couldn’t provide any caselaw authority proving a successor-in-interest is sufficient to prove ownership, but he later granted summary judgment when Bank of America filed a motion to correct error that cited a federal statute providing that authority.

The bank cited 12 U.S.C. § 215a(e) that outlines the corporate existence of each merging bank and how all rights, franchises and interests of the individual merging banks are transferred to the successor merged bank without any deed or other transfer being needed.

Although the bank referenced a copy of the merger certificate and no factual dispute existed that a merger had occurred, Bank of America didn’t include a copy of that merger certificate. The trial court granted its judgment of foreclosure and decree of sale in the bank’s favor in April 2011. Appealing, CFS alleged the trial court granted summary judgment only after improperly considering “new evidence” about that federal statute.

The Court of Appeals ruled that Bank of America didn’t have to attach a copy of the merger when there was no factual dispute it had happened, and that the federal statute wasn’t “new evidence” presented to the trial court. The appellate panel found that no genuine issue of material fact existed about the merger and that summary judgment was properly granted to Bank of America.

 

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  1. A traditional parade of attorneys? Really Evansville? Y'all need to get out more. When is the traditional parade of notaries? Nurses? Sanitation workers? Pole dancers? I gotta wonder, do throngs of admiring citizens gather to laud these marching servants of the constitution? "Show us your billing records!!!" Hoping some video gets posted. Ours is not a narcissistic profession by any chance, is it? Nah .....

  2. My previous comment not an aside at court. I agree with smith. Good call. Just thought posting here a bit on the if it bleeds it leads side. Most attorneys need to think of last lines of story above.

  3. Hello everyone I'm Gina and I'm here for the exact same thing you are. I have the wonderful joy of waking up every morning to my heart being pulled out and sheer terror of what DCS is going to Throw at me and my family today.Let me start from the !bebeginning.My daughter lost all rights to her 3beautiful children due to Severe mental issues she no longer lives in our state and has cut all ties.DCS led her to belive that once she done signed over her right the babies would be with their family. We have faught screamed begged and anything else we could possibly due I hired a lawyer five grand down the drain.You know all I want is my babies home.I've done everything they have even asked me to do.Now their saying I can't see my grandchildren cause I'M on a prescription for paipain.I have a very rare blood disease it causes cellulitis a form of blood poisoning to stay dormant in my tissues and nervous system it also causes a ,blood clotting disorder.even with the two blood thinners I'm on I still Continue to develop them them also.DCS knows about my illness and still they refuse to let me see my grandchildren. I Love and miss them so much Please can anyone help Us my grandchildren and I they should be worrying about what toy there going to play with but instead there worrying about if there ever coming home again.THANK YOU DCS FOR ALL YOU'VE DONE. ( And if anyone at all has any ideals or knows who can help. Please contact (765)960~5096.only serious callers

  4. He must be a Rethuglican, for if from the other side of the aisle such acts would be merely personal and thus not something that attaches to his professional life. AND ... gotta love this ... oh, and on top of talking dirty on the phone, he also, as an aside, guess we should mention, might be important, not sure, but .... "In addition to these allegations, Keaton was accused of failing to file an appeal after he collected advance payment from a client seeking to challenge a ruling that the client repay benefits because of unreported income." rimshot

  5. I am not a fan of some of the 8.4 discipline we have seen for private conduct-- but this was so egregious and abusive and had so many points of bad conduct relates to the law and the lawyer's status as a lawyer that it is clearly a proper and just disbarment. A truly despicable account of bad acts showing unfit character to practice law. I applaud the outcome.

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