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Man lacks standing to pursue cause of actions in failed home purchase

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The Indiana Court of Appeals affirmed that the underwriter of title insurance stands in the shoes of its insureds, so a man suing several entities over a failed home purchase lacks standing to pursue his causes of action.

Beneficial Mortgage Co. of Indiana purchased a property it had funded in a sheriff’s sale. Real estate taxes were owed on the property, and it was purchased at a tax sale several days after Beneficial received title. The Wolvertons purchased the property at issue in the tax sale in September 2000 and sent notice to Beneficial.

Guadalupe Puente obtained a mortgage from PNC to purchase the property from Beneficial in April 2001. When Puente purchased the property, Meridian Title Corp. issued a standard American Land Title Association policy of title insurance to him and a lender’s policy of title insurance to PNC. Fidelity was the underwriter for both policies.

The Wolvertons filed a quiet-title action and eventually were victorious in their suit. Puente, in 2008, vacated the property. The trial court awarded the Wolvertons $5,700 in damages, which took into account their lost rent during the 62 months at issue plus the $16,000 in increased property value during Puente’s occupancy as a result of his efforts.

At issue in Guadalupe Puente v. Beneficial Mortgage Co. of Indiana, PNC Bank, Fidelity National Title Insurance Co., and Meridian Title Corp., 45A03-1304-PL-159, is whether Fidelity has subrogration rights to pursue Puente’s claims against Beneficial and others.

“Puente argues that subrogation is an entirely equitable remedy and that the equities in this case counsel against subrogation. Fidelity argues, and the trial court held, that equitable subrogation is not applicable here. Rather, the plain terms of the insurance policy’s subrogation clause eliminated any need to consider the equities because Fidelity is entitled to subrogation as a matter of contractual right. The question therefore is whether the right of subrogation can exist by contract, without the need to resort to a balancing of the equities,” Judge Ezra Friedlander wrote.  
Several jurisdictions have specifically addressed the question presented here: whether conventional subrogation is subject to equitable considerations, and the decisions have gone both ways, the court noted.

When it comes to subrogation provisions in insurance policies, the court adopted the view that equity is not a consideration in cases involving conventional – or contractual – subrogation.

“Ultimately, it places the onus on parties to an insurance contract to negotiate terms as they see fit, and then to abide by the terms of the resulting contract in the event insurance coverage is triggered,” he wrote, noting the language in the policy is broad enough to confer upon Fidelity a contractual right to subrogation.
 

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  1. Well, maybe it's because they are unelected, and, they have a tendency to strike down laws by elected officials from all over the country. When you have been taught that "Democracy" is something almost sacred, then, you will have a tendency to frown on such imperious conduct. Lawyers get acculturated in law school into thinking that this is the very essence of high minded government, but to people who are more heavily than King George ever did, they may not like it. Thanks for the information.

  2. I pd for a bankruptcy years ago with Mr Stiles and just this week received a garnishment from my pay! He never filed it even though he told me he would! Don't let this guy practice law ever again!!!

  3. Excellent initiative on the part of the AG. Thankfully someone takes action against predators taking advantage of people who have already been through the wringer. Well done!

  4. Conour will never turn these funds over to his defrauded clients. He tearfully told the court, and his daughters dutifully pledged in interviews, that his first priority is to repay every dime of the money he stole from his clients. Judge Young bought it, much to the chagrin of Conour’s victims. Why would Conour need the $2,262 anyway? Taxpayers are now supporting him, paying for his housing, utilities, food, healthcare, and clothing. If Conour puts the money anywhere but in the restitution fund, he’s proved, once again, what a con artist he continues to be and that he has never had any intention of repaying his clients. Judge Young will be proven wrong... again; Conour has no remorse and the Judge is one of the many conned.

  5. Pass Legislation to require guilty defendants to pay for the costs of lab work, etc as part of court costs...

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