Hoeg v. Twin City Federal Savings & Loan Ass'n

324 N.W.2d 377, 1982 Minn. LEXIS 1788

Opinion

TODD, Justice.

Kenneth and Marjean Hoeg purchased a home and placed a mortgage on the property with Twin City Federal Savings & Loan Association. The mortgage contained a due on sale clause. The Hoegs desired to sell the property and were informed by Twin City Federal that the mortgage could not be assumed. The Hoegs brought a declaratory judgment action. The trial court, relying on our decision in Holiday Acres No. 3 v. Midwest Federal Savings & Loan Association of Minneapolis, 308 N.W.2d 471 (Minn.1981), properly concluded that the due on sale clause was unenforceable. Subsequently, the United States Supreme Court held that the federal regulation which vali dates due on sale clauses for federal savings institutions preempts state law. See Fidelity Federal Savings & Loan Association v. de la Cuesta,-U.S.-, 102 S.Ct. 3014, 3025, 73 L.Ed.2d 664 (1982).

Based on the Fidelity decision, we are compelled to reverse the decision of the trial court.

Reversed and remanded for further proceedings consistent with this opinion.