Justia Kentucky Supreme Court Opinion Summaries
Articles Posted in Real Estate & Property Law
Smith v. Williams
The circuit court granted Appellants' motion for summary judgment in a partition action for the sale of jointly owned real estate, having found that the statute of frauds prevented enforcement of an alleged oral "buy/sell" agreement between the parties. The court of appeals reversed, holding that Appellants, as the party attempting to force the sale, were impermissibly using the statute of frauds as a "sword" and not a "shield" and because "no action" was brought by Appellees that might trigger the application of the statute. The court therefore remanded the matter for a determination as to whether the oral buy/sell agreement existed and its effect on the disposition of the property at issue. The Supreme Court reversed the court of appeals, holding that because there was no signed writing in this case, and because there was no evidence that the agreement was not reduced to writing because of fraud at the time of omission or evidence that the application of the statute of fraud would result in Appellants being unjustly enriched, summary judgment was proper. View "Smith v. Williams" on Justia Law
Hall v. Mortgage Elec. Registration Sys., Inc.
This case required the Supreme Court to determine whether Appellee, Mortgage Electronic Registration Systems, Inc. (MERS) had "good cause" for failing to timely release a satisfied real estate lien it held on Gary and Sharon Hall's property. The circuit court concluded that the Halls were not entitled to statutory damages because, although MERS filed a release referencing the wrong mortgage, the Halls provided insufficient notice to MERS of the release's actual deficiency. Thus, the court found MERS had "good cause" not to file a new release once it checked and found it had already filed one. The court of appeals affirmed. The Supreme Court affirmed, holding that MERS satisfied the "good cause" requirement under these particular circumstances. View "Hall v. Mortgage Elec. Registration Sys., Inc." on Justia Law
Mortgage Elec. Registration Sys., Inc. v. Roberts
This case presented the question of whether the doctrine of equitable subrogation may be used to reorder the priority of a mortgage lien where the mortgage holder had constructive but not actual knowledge of a pre-existing lien when it paid off an earlier mortgage as part of a refinancing deal and there was no fraud or other misconduct that would have prevented the discovery of the lien. The trial court applied the doctrine to reorder the priority of liens. The court of appeals reversed, finding that the doctrine did not apply under the facts of this case. The Supreme Court affirmed, holding that because equitable subrogation is not available to a lienholder who has actual or constructive knowledge of a preexisting lien, the court of appeals was correct in concluding that the remedy was not available to the mortgage holder. View "Mortgage Elec. Registration Sys., Inc. v. Roberts" on Justia Law
Bailey v. Preserve Rural Rds. of Madison County, Inc.
After the fiscal court voted to discontinue maintenance on a county road, Appellant, who owned property and lived on the road, erected a locked gate blocking the road and provided a key to each property owner on the road. Appellees, a non-profit association known as Preserve Rural Roads of Madison County, filed suit against Appellant to force him to remove the gates. The circuit court granted Appellees' motion for summary judgment, finding that Appellees had standing and that Appellant was without legal right or ownership to prohibit others from using the road. The court of appeals affirmed. The Supreme Court affirmed, holding (1) Rural Roads had associational standing in this matter; (2) the discontinuance of maintenance on the county road did not affect any public easement rights; and (3) the lower courts' decisions in this case, holding that the county road is a public road and that Appellant could not block the road with gates, did not constitute an unlawful taking of Appellant's land. View "Bailey v. Preserve Rural Rds. of Madison County, Inc." on Justia Law
Greene v. Commonwealth
Appellants, a group of heirs who were entitled to receive the net proceeds of a judicial sale of four tracts of land, sued Appellees, a former master commissioner of the circuit court, a circuit court judge, and the administrative office of the courts, pursuant to the Kentucky Board of Claims Act, after the former master commissioner failed to disburse the proceeds of the sale. The Board of Claims (Board) entered a final order dismissing Appellants' claims for lack of jurisdiction. The circuit court and court of appeals affirmed. At issue on appeal was whether a claim involving judicial officers or court employes may proceed at the Board. The Supreme Court reversed, holding that the judge's continued use of the master commissioner, without reappointment, to perform significant functions in actions in the circuit court without a bond and without surety approved by the judge as statutorily mandated, was grounds for a claim in the Board of Claims based upon alleged negligence in the performance of a ministerial duty by an officer of the state. Remanded to the Board for a determination of whether Appellants suffered damages as a proximate cause of the alleged negligence. View "Greene v. Commonwealth" on Justia Law
Fischer v. Fischer
Two brothers had a dispute over an alleged oral agreement relating to the care of their mother by which one brother agreed to give up part of his inheritance if the other brother would care for their mother. The trial court found that a valid agreement between the brothers had been reached. The court of appeals reversed on an issue that had not been raised at the trial court but which the court reached as part of its overall examination of the validity of the agreement. The Supreme Court affirmed, holding (1) the court of appeals cannot reverse the judgment of the trial court on an issue that was not specifically raised at the trial court, but (2) the court of appeals nevertheless reached the correct result because the parties' agreement was unenforceable under the statute of frauds, and thus, no action on it could be maintained. View "Fischer v. Fischer" on Justia Law
Central Bank of Jefferson Cty v. Dept. of Revenue
In the underlying cases, the respective property owners failed to satisfy their debt obligations to professional lending institutions, which precipitated foreclosure proceedings. The Commonwealth intervened, seeking to block the foreclosures pending resolution of the tax liens. In both cases, the lenders brought suit to assert that their respective mortgages were superior to the general tax liens filed pursuant to the state recording statutes. Kentucky is a "race-notice" state in that a mortgage, deed or deed of trust takes effect at the time it is recorded. In both cases, the tax liens superseded the lenders' liens; but the lenders argued that state law provided super priority for ad valorem taxes, not general tax liens, therefore their purchase money mortgages superseded the Commonwealth's liens. Disagreeing with the lenders' characterization of the tax liens, the Supreme Court held that the tax liens took priority over the lenders' liens, and should be afforded no special priority.
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Kentucky Supreme Court, Real Estate & Property Law
Nash v. Campbell Cty. Fiscal Ct.
Paul and Pat Nash own twenty-eight acres in Campbell County. Clifford and Toby Torline own thirty-five acres. Both Nash and Torline wished to divide their parcels into tracts of five or more acres each for agricultural uses. Nash and Torline see the five-acre plots as mini-farms, but the County views the plots as residential subdivisions with large lots. The County Clerk petitions the court for guidance as to whether or not he should accept the deeds of the five-acre divisions for recording. The County maintains that two of its ordinances prohibit any division until the property owners prove to the Planning Commission that the divisions were for agricultural purposes. Nash and Torline take exception to having the burden placed on them, and argue that the County must prove the divisions were not exempt from subdivision regulations. The trial court agreed with Nash and Torline, and held that the County's ordinances violated the agricultural supremacy clause and were therefore unconstitutional. The appellate court reversed the lower court and ordered summary judgment on behalf of the County. The Supreme Court accepted discretionary review, affirmed in part the lower court's decision, reversed in part, and remanded the case to the trial court to enter summary judgment in favor of the County. The Court found that the five-acre plots were subdivisions that required planning commission approval before recording.