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Court cites 1827 case to affirm mortgage trumps land contract

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A bank that issued a mortgage to a person selling a property on a land contract has the right to foreclose on the loan, the Indiana Court of Appeals ruled, citing caselaw nearly 200 years old.

Judge John Baker cited the “first in time is first in right” doctrine and Chief Justice John Marshall’s ruling in Rankin v. Scott, 25 U.S. (12 Wheat) 177, 179 (1827) to determine that the bank had the senior claim on a property in Cumberland even though a land contract between the owner and buyer had been executed years earlier. The contract wasn’t recorded until after the mortgage was recorded.

In Walter E. Lunsford v. Deutsche Bank Trust Company Americas as Trustee 30A01-1302-MF-63, the appeals panel affirms the summary judgment grant to the bank by Hancock Superior Judge Richard D. Culver.

Lunsford appealed pro se, arguing among other things that Deutsche Bank failed to produce loan documents, that it had no right to acquire a loan as a mortgage-backed security, that it failed to join indispensable parties, that it had no standing to bring the foreclosure action, and that it did not exist. Lunsford also argued on appeal that the bank refused payment from him.

Baker wrote that several of the arguments were waived because they weren’t raised at the trial court, and that the trial court gave Lunsford opportunities to pay the mortgage, but no tender was made.

“The mortgage was recorded on August 25, 2005, by the Recorder of Hancock County,” Baker wrote in an opinion joined by judges Ezra Friedlander and Nancy Vaidik. “Lunsford’s Land Contract was recorded on March 8, 2006, which was over six months after the mortgage was recorded and perfected. … Consequently, the mortgage is senior in priority to Lunsford’s Land Contract.

“Moreover, because Lunsford was made a party to Deutsche Bank’s foreclosure action and given the opportunity to assert his junior interest in the Real Estate, the judgment is conclusive on him,” the panel concluded in affirming the trial court.
 

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  1. Hail to our Constitutional Law Expert in the Executive Office! “What you’re not paying attention to is the fact that I just took an action to change the law,” Obama said.

  2. What is this, the Ind Supreme Court thinking that there is a separation of powers and limited enumerated powers as delegated by a dusty old document? Such eighteen century thinking, so rare and unwanted by the elites in this modern age. Dictate to us, dictate over us, the massess are chanting! George Soros agrees. Time to change with times Ind Supreme Court, says all President Snows. Rule by executive decree is the new black.

  3. I made the same argument before a commission of the Indiana Supreme Court and then to the fedeal district and federal appellate courts. Fell flat. So very glad to read that some judges still beleive that evidentiary foundations matter.

  4. KUDOS to the Indiana Supreme Court for realizing that some bureacracies need to go to the stake. Recall what RWR said: "No government ever voluntarily reduces itself in size. Government programs, once launched, never disappear. Actually, a government bureau is the nearest thing to eternal life we'll ever see on this earth!" NOW ... what next to this rare and inspiring chopping block? Well, the Commission on Gender and Race (but not religion!?!) is way overdue. And some other Board's could be cut with a positive for State and the reputation of the Indiana judiciary.

  5. During a visit where an informant with police wears audio and video, does the video necessary have to show hand to hand transaction of money and narcotics?

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