Circuit Court Default Judgement
I have a piece of property that I had trouble with the seller completing a deal we had made. After we signed a contract, I send the down payment and was to send the balance upon receiving a warrenty deed. As the expiration date on our existing contract got closer, I call the seller and he said that the date was no problem, if I was still willing to buy. I still never received a deed and never sent the balance for the purchase.
Afterward, he stopped returning phone calls. I had went on and fixed the property up and now have a tenant in the property.
After I couldn't get the seller to call back after numerous attempts on the phone and through certified mail, I employed an attorney to try to clear the title by default. I was awarded a clerks deed by default judgement, because the seller never showed up to court.
Now I am being told that the seller didn't have authorization to sell the property because someone else had been appointed as overseer due to a Law suit that was being filed in another county.
The seller was from out of state, the overseer is from another county, the law suit was filed in another county, and I have all my documents recorded in the county that the property is in.
Can this property be taken from me if I didn't know the seller didn't have authority to sell? When I had the records checked at the courthouse, it only showed the sellers business as the owner.
Should the overseer not have advertised in the paper in the county where the property is that it was possible tied up in a legal law suit? 
I know there's gotta be some advice or knowledgable subjects out there.
I would appreciate you input, thoughts, ideas.....
The only advice someone should give you is to get an attorney right away. You should NOT try to navigate this mess by youself.
GL!
telemon is right.
Get an attorney pronto.
You may find some good tips online, but how do you know the person on the other end isn't typing his reply from a mental hospital?
[addsig]
Wild guesses here, but you have no deed from the seller (you have a deed from the court), which is your major problem. Quick action on competent legal advice will be of key importance regardless of how this shakes out.
You either luckily have a case against the overseer (receiver?) for specific performance of the contract in question, or unluckily you have a case against the seller for fraud. [ Edited by flacorps on Date 12/27/2003 ]
I can advise you what to do with your J against the out-of-stater.
Do a LEXIS asset search for him, in his home state & any others you might think necessary, and if you unearth any asset, then you're in position to record your J there, in his county, and seriously threaten him & his assets.
It used to be necessary, in every state, to obtain a J in that state, on the original J from another state; but recently there has been enacted a Uniform Law of Out of State Judgment Collection:" so now, in those states that have enacted same, it's just a matter of recording same in whatever counties you choose.
Am I reading that in these type of judgements there is nothing recorded against the property, so a title search won't show any defects? Even after a diligient title search, one could still end up in this situation?
Is this something that title insurance would cover?
Or, is this a case of not doing a diligent title search in advance?
A thourough Title search was done, however, the only thing found was an old personal loan of $6,000. The title company could not find that lender nor that borrower. We then attempted to contact my seller with no luck. That's one of the reasons they suggested that I seek a Clears Deed. No title insurance was obtained due to this was going to be a cash deal. The property was condemned and about to be torn down. I move to hold the condemnation and restored the property.
Did I screw up?
JohnMerchant
What is a LEXIS assest search?
It is kind of scary that even after a title search something like this could happen. I would have purchased title insurance, even if it was a cash purchase, to defend against cases like this. Having said that, I hope someone can tell us if title insurance would have covered this scenario.
Title Insurance was never purchased, however, the seller would not even communicate with me, the title company, nor the attorney that eventually filed a request for a default judgement.
I never even got the opportunity to completely pay him cause he never sent the Deed.
I already had over $50,000 in renovation cost.
We are being told that he had defrauded several people and that he was being watched by the Authorities. However, nothing was filed at all about this piece of property being included in a Law suit.
How can they not notify the public or anyone that may have an interest in the property?
Quote:I already had over $50,000 in renovation cost. This is an equity in your favor that you should definitely hang over the overseer/trustee/receiver in negotiating this situation. If the property is taken from you without compensating you for what you added to it, it would be "unjust enrichment". You'll need an appraisal of the property now, and one "as of" the date you contracted to buy it (or the date you got the court's deed, depending on the legalities).
I really don't see much opportunity for you to have gotten title insurance against this sort of risk once you had to go the court-ordered route.
My guess is that the upshot of all of this is going to be that the other side will collect a few bucks from you and issue you an airtight title. Your attorney's goal will be to make that as few bucks as possible.
But your attorney might be able to do a quiet title action and make this go away too ... perhaps without paying the pest. [ Edited by flacorps on Date 12/27/2003 ]
Although this is definatly a situation that you should hire a competent attorney to handle, I really don't see any problem for you other than legal fees. As far as my layman opinion goes, everything should be recorded. When doing a title search, it would have brought up the potential of the seller not being able to sell the property. Nothing came up and you went through the proper routes to obtain a deed from the court.
I wouldn't worry too much...it will just be a headache for you.
Quote:
On 2003-12-27 14:41, esuccess wrote:
JohnMerchant
What is a LEXIS assest search? <IMG SRC="images/forum/smilies/icon_confused.gif">
LEXIS is a legal database with all sorts of infomation for lawyers. NEXIS is its counterpart for newshounds (like Google news, but with a memory like an elephant and nearly every news source in it). Paid services, typically charging by the minute or by the search. LEXIS's main competitor is Westlaw. NEXIS's main competitor is free internet searching...
There should have been proper notice into and onto the title. Indication of a Receivership, or a LPends. That is a requirement. Unrecorded goodies do not count.
A good atty is very important. Good not as to morals but as to ability and knowledge of the law. We must not ask for the impossible or improbable.
Calif. We have this type of thing pretty well covered. You have the Hall of Records in which is recorded all items of Real Property. Then the title company does a court house search the night before the 0800 recordings. They check everything pending or zending.
Between these two attacks we are pretty save. Of course someone always shows up with the unrecorded Grant Deed or Trust Deed, dated back in time with what is politely called a Forcement Notary. They loose.
Get with it as rapidly as possible and also try to locate that really bad boy. You will be amazed what a little present time pressure in his face will accomplish. If he feels that he might spend time he might become very cooperative. It looks to me that he has established a criminal pattern Get That Attorney Working.
Expectantly Lucius
Thanks everyone,
I really appreciate all the feedback. An attorney will be obtained. Is there a speciality they should have other than Real Estate Law? or do they need to have that specialty?
You want someone who can litigate ... if you don't start with a litigator, you'll probably have to add one later.
But if you start with a litigator, the other side could be made so miserable they won't care what the law says, they'll just want out.
Thanks ..
If this full transaction had been completed and Title Insurance had been obtained, would that insurance have covered this issue?
Quote:
On 2003-12-28 00:07, esuccess wrote:
If this full transaction had been completed and Title Insurance had been obtained, would that insurance have covered this issue?
I'm no expert on title insurance, but I would guess yes, unless there was a specific exception in the policy.
JohnMerchant
What is a LEXIS assest search?
As you've been advised, Lexis is a huge lawyer's website*, but usable by anybody, for small fee, for such as asset searches, law briefing, etc....well worth the money when it's needed.
*www.Lexis.com, or if that doesn't get it, query Google or another search engine, and you'll quickly find it.
By the way, your J is NOT automatically recorded or known to deed records, or title searchers...you've got to get certified copy of the J, then take it to deed records and get it recorded...then, it WILL pop up as lien against any RE the guy might own...and remember, this must be done in EVERY county, and in every state, in which you want it to be a lien.
Thanks JohnMerchant
I did have the Default judgement recorded as well as the Clerks Deed. This was done the moment I received them from the Attorney.