Adam Leitman Bailey, P.C. Wins Payoff Dispute Case in Favor of Title Company
In 21st Mortgage Corp. v. Fidelity National Title Ins. Co., et al., an action commenced by a lender demanding payment of its loan plus damages, Adam Leitman Bailey, P.C. orchestrated a settlement by which the lender was paid, the borrower was paid, and all claims for damages asserted against the title company were dropped in their entirety.
On September 10, 2007, the borrower sold her the premises, but, at the closing of the sale, there was a dispute as to the amount owed to satisfy her existing mortgage. In order to close, all proceeds from the sale were deposited with the title company, to be held pending the title company’s receipt of an agreed-upon payoff statement for the mortgage. The title company never received an approved payoff and continued to hold the funds for nearly nine years.
The lender commenced an action against the title company demanding that the funds be turned over and that additional monies be paid by the title company in order to satisfy the mortgage plus interest and damages.
Adam Leitman Bailey, P.C. was retained to protect the title company from having to pay out damages and to get the lender paid from the funds held in escrow.
Since an escrow agent has a strict duty to protect the rights of the parties to whom it acts as an agent and cannot deliver funds in escrow except upon strict compliance with the conditions imposed by the controlling escrow agreement, and since the borrower was not a party to the action, Adam Leitman Bailey, P.C. successfully argued that the joinder of the borrower to the action was mandatory in order for the lender to continue the action. Adam Leitman Bailey, P.C. tracked down the borrower, served an interpleader complaint, and, after an argument before the Honorable Geoffrey D. Wright, J.S.C., successfully strategized and mediated a full settlement of the action, under which the title company only paid the funds that it was holding in escrow, and all claims for damages were discontinued with prejudice.
Jackie Halpern Weinstein of the Foreclosure and Title Groups at Adam Leitman Bailey, P.C. won this case for the title company.