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Solving a centuryold deed puzzle
Taming Title Defects
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news WWW.REBA.NET
OCTOBER, 2011
THE NEWSPAPER OF THE
REAL ESTATE BAR ASSOCIATION
Vol. 8, No. 5
A publication of The Warren Group
COMMENTARY
PRESIDENT’S MESSAGE
MERS and the Registry of Deeds
REBA’s active mission
B Y R I C HA R D P. HOW E J R .
Dick Howe
Back in the fall of 1991, a popular Friday afternoon activity in downtown Lowell was to walk around the city looking for clues as to which bank would be seized by the FDIC that day. Carloads of U.S. Marshalls, clad in blue blazers and gray slacks, would race up
to the front door and physically take control of the place, using the weekend to take inventory. Entities such as Lowell Institution for Savings and Central Savings Bank that had been around for longer than the city itself were seemingly gone overnight, casualties of the bursting of that era’s housing bubble. Banks were not the only casu-
alties of that collapse. Countless homeowners had their lives disrupted when assignments and discharges disappeared or didn’t exist and missing paperwork became a drag on the real estate market’s recovery. At least that is how I remember things during the early days of my tenure as Register of See MERS, page 2
Hon. Robert Cordy to keynote REBA 2011 Annual Meeting & Conference
{ { U.S. Supreme Judicial Court Associate Justice Robert J. Cordy, who wrote a concurring opinion in the Supreme Judicial Court foreclosure case, U.S. national Bank Association vs Ibanez, will be the keynote speaker at REBA’s 2011 Annual Meeting Conference on November 14 at the Best Western Royal Plaza Hotel in Marlborough. Cordy’s concurring opinion noted the “utter carelessness” of the plaintiff banks in the case pertaining to the title documentation of their assets. “Foreclosure is a powerful act with significant consequences, and Massachusetts law has always required that it proceed strictly in accord with the statutes that govern it.” He also noted – though the issue was not before the Court in this particular case – the possible effect on third-party purchasers of foreclosed properties that were not properly recorded and the foreclosures not contested.
REBA Hosts Exclusive Paralegal Programs REBA will host three special programs for paralegals at the association’s all-day annual meeting and conference (AMC11) on Monday, Nov. 14, 2011, at the Best Western Royal Plaza Hotel in Marlborough.
The hour-long programs will include Foreclosures for Paralegals with Ward Graham; Short Sales for Paralegals with Amanda Zuretti and A Paralegal’s Primer on Homesteads with Erica Bigelow.
The all-day conference will include a plenary luncheon meeting with SJC Associate Justice Robert J. Cordy as a featured luncheon keynote speaker. To register for the AMC11 go to www.reba.net.
BY EDW ARD M. BL OOM
Recently, I watched a documentary about Hubert Humphrey, one of the greatest senators of the 20th century. I was quite moved by the “Happy Warrior’s” interpretation of the Preamble to the Constitution as a call to Americans to be actively involved in the business of providing a more perfect union for “we the people of the United States.” He noted that each of the verbs in the Preamble is active: to establish justice, to insure domestic tranquility, to promote the general welfare, and to secure the blessEd Bloom ings of liberty. His point was that unless citizens actively engage in politics and the issues confronting the country, the goals of the Constitution cannot be achieved. And this interpretation holds true when analyzing any organization, for if its members do not participate, the organization becomes moribund and ceases to provide benefits for or remain relevant to its constituents. REBA’s mission is to advance the practice of real estate law, to sponsor professional standards, to create educational programs and to promotefair dealings and good fellowship among members of the real estate bar. These goals require the active participation of REBA members in order for REBA to serve its members or be valuable to their real estate practices. So who are these men and women of REBA who volunteer their time and expertise and why do they do it? They are individuals who do not see their role as lawyers as simply providing them with income to live on, but rather view their chosen field as a professional calling with a duty to the law, the courts and society as a whole. These men and women believe in REBA’s mission and so they join its committees, participate in its educational programs, See VOLUNTEERS, page 2
Supreme Court to hear separation of powers issue within title insurance kickback case
B Y D O U G L A S W. S A LV E S E N
FACTUAL AND PROCEDURAL BACKGROUND
The Supreme Court has agreed to decide whether a homebuyer can sue a title insurer for violation of the Real Estate Settlement Procedures Act of 1974 (RESPA) even though the homebuyer cannot establish that the violation increased the amount she paid for title insurance services.
In 2006, Denise Edwards bought a three-bedroom home in the North Collingwood section of Cleveland for $111,000. The settlement agent, Tower City Title Agency, LLC, referred Edwards to First American Title Insurance Co. for her title insurance policy.
At the time of the referral, Edwards was unaware of the commercial relationship between Tower City and First American. In 1998, First American had paid $2 million to Tower City. First American maintains that the payment was to buy a minority interest in the agency. Edwards insists that the payment was part of a kickback arrange-
ment whereby Tower City agreed to refer all title-insurance underwriting business exclusively to First American. In a class action filed in federal court, Edwards alleged that this exclusive referral arrangement violated RESPA. However, because Ohio law mandates that all title insurers charge the same price, See TITLE KICKBACK, page 3