Daniel P. Millikan v. Lori A. Eifrid

968 N.E.2d 243, 2012 WL 1481492, 2012 Ind. App. LEXIS 210
CourtIndiana Court of Appeals
DecidedApril 30, 2012
Docket92A03-1109-PL-433
StatusPublished
Cited by2 cases

This text of 968 N.E.2d 243 (Daniel P. Millikan v. Lori A. Eifrid) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Daniel P. Millikan v. Lori A. Eifrid, 968 N.E.2d 243, 2012 WL 1481492, 2012 Ind. App. LEXIS 210 (Ind. Ct. App. 2012).

Opinion

OPINION

BAKER, Judge.

In this case, the trial court properly determined that the plaintiff was the bona fide and innocent purchaser for value of a parcel of property when applying the doctrine of equitable subrogation. Thus, title to the property awarded to the plaintiff is superior to any right, title, or interest that might be claimed by the defendant or his successors in interest. However, because the trial court determined that the defendant had not committed fraud that might otherwise have entitled the plaintiff to recover her attorney fees, we reverse that portion of the judgment and vacate the award of attorney fees.

Appellant-defendant Daniel P. Millikan appeals the judgment entered in favor of appellee-plaintiff Lori A. Eifrid, on her claims against Millikan for foreclosure, specific performance, and promissory es-toppel, regarding a certain parcel of real property. Specifically, Millikan maintains that the trial court erred in applying the doctrine of equitable subrogation in these circumstances and awarding the property to Eifrid. Millikan also claims that the trial court erred in ordering him to pay Eifrid’s attorney fees.

We conclude that the trial court properly awarded the real property to Eifrid. However, we also find that the trial court erred in ordering Millikan to pay Eifrid’s attorney fees. Thus, we affirm in part, reverse in part, and remand this cause with instructions that the trial court vacate the award of attorney fees.

FACTS

Eifrid owns approximately .495 acres (Parcel A) of real property in Whitley County, and a four foot wide strip (Strip) of land directly to the east of that property.

Millikan owns certain property adjacent to Eifrid’s Parcel A property, including parcels that abut a right-of-way immediately to the south of Parcel A. Both Eifrid and Millikan’s property are located near the same cul de sac. The dispute in this case involves a parcel of land directly to the south of Parcel A (hereinafter referred to as the Triangle). The Triangle is essential to Eifrid’s use and enjoyment of her property because, without it, Eifrid’s ingress and egress to the cul-de-sac is effectively prevented.

On October 15, 2001, Richard Millikan and his wife, Charlene, executed a warranty deed transferring and conveying title to the Eifrid property and the Triangle to *246 Roger L. Maxey. That deed was recorded in the Whitley County Recorder’s Office on October 16, 2001, as document number 200110560. At the time of that transfer, the Eifrid property and the Triangle were identified as single parcels of property.

That same day, Maxey executed a mortgage on the properties he acquired from the Millikans in favor of RWG Mortgage Company, Inc. (RWG). That mortgage was recorded on October 16, 2001, as document number 200110561. However, on October 15, the mortgage in favor of RWG was assigned and transferred from RWG to ABN AMRO Mortgage Group, Inc. The assignment was recorded in the Whitley Recorder’s Office on October 16, 2001, as document number 200110562.

At about the same time of the transfer, Richard’s brother, Daniel Millikan (the appellant in this case), reached an oral agreement with Maxey to obtain the Triangle from Maxey in exchange for the Strip. To effectuate that exchange, Millikan caused a legal description to be determined such that the Strip would, for the first time, be described as a single piece of real estate. Maxey also caused a legal description to be determined such that the Triangle would also be described as a single piece of real estate. However, the surveys for the Strip and Triangle were not completed until February 26, 2002, at which point, the ABN AMRO mortgage encumbered both Parcel A and the Triangle.

In June 2003, Maxey endeavored to refinance Parcel A and the Triangle through Mortgage Electronic Registrations Systems, Inc. (MERS), as nominee for Countrywide. The day before the closing, Maxey executed a quitclaim deed to the Triangle in favor of Millikan on June 16, 2003. Millikan reciprocated by executing a quitclaim deed to the Strip in Maxey’s favor. When the Triangle was quit-claimed to Millikan, the property was encumbered by the ABN AMRO mortgage.

The transfers by and between Millikan and Maxey were undertaken without the knowledge of, or any disclosure whatsoever to, the then lienholder, ABN AMRO, or to the soon to be subsequent lienholder, Countrywide. The partitioning of the Triangle from Parcel A effectively precludes Parcel A from any access to the right-of-way in the cul de sac described above.

Millikan knew of the mortgage on the Eifrid property when he accepted the transfer from Maxey, and he never communicated that purported transfer to Countrywide. It was only through the refinancing, and payment by Countrywide to ABN AMRO, that the ABN AMRO mortgage encumbering both the Eifrid Property and the Triangle was ultimately released when Countrywide paid Maxey’s outstanding indebtedness to ABN AMRO. Countrywide’s expectation was a security interest in the entire property, as evidenced by the legal description of the deed. The ABN AMRO mortgage was released on October 16, 2003, and Maxey later defaulted on the terms of his mortgage with Countrywide.

In consideration for the forgiveness of his financial obligation owed to Countrywide, which was in default, Maxey executed a warranty deed in lieu of foreclosure (Deed in Lieu) in favor of the Secretary of Veterans’ Affairs (SVA). The Deed in Lieu from Maxey to the SVA also described and purported to transfer the Triangle to the SVA. At all times, the documents regarding any transfer or mortgage of property included Parcel A and the Triangle as a single tract.

Eifrid was to become the next owner of the property. When purchasing the property from the SVA, Eifrid was provided a deed that included the description of Parcel A and the Triangle as a single tract. *247 On July 12, 2006, the SVA, via quitclaim deed, transferred title of both parcels to Eifrid. Eifrid was provided with a deed that included descriptions of Parcel A and the Triangle as a single tract. Thus, Ei-frid believed that she was purchasing property that included access to the cul de sac as a right-of-way through the rear of the property.

Eifrid initially became aware of the issues that were caused by the attempted “swap” of properties between Millikan and Maxey in 2008, when she received notice that a mortgage company, Resurgent Capital Services, LP (Resurgent), was seeking to foreclose on the Strip. At the time, the Strip remained titled in Maxey’s name. Discussions commenced between counsel for the respective parties with regard to reversing the Millikan/Maxey “swap” that would result in the Triangle being owned by Eifrid and the Strip being owned by Millikan.

In addition to the fact that the Strip remained in Maxey’s name, the Strip was also encumbered by a mortgage in the principal amount of $26,000. Thus, in order to effectuate the swap — or more appropriately a “swap back” — Eifrid was required to take affirmative steps to acquire clear title to the Strip. On several occasions, Eifrid informed Millikan of her intent to acquire the Strip to effectuate the swap.

On July 9, 2008, Eifrid’s counsel filed a complaint to foreclose the mortgage.

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Bluebook (online)
968 N.E.2d 243, 2012 WL 1481492, 2012 Ind. App. LEXIS 210, Counsel Stack Legal Research, https://law.counselstack.com/opinion/daniel-p-millikan-v-lori-a-eifrid-indctapp-2012.