In a case of first impression, Morrison Sund’s litigation team assists Stewart Title Guaranty Company in obtaining a reversal from the Minnesota Court of Appeals.


Posted on 08/27/2015

In Twin Cities Metro-Certified Development Company v. Stewart Title Guaranty Company – N.W. 2d –, 2015 WL 4715064  (Minn. App. 2015) mechanics’ liens took priority over a junior mortgage insured by a lender’s policy of title insurance.  The policy excepted from coverage any loss caused by a senior mortgage.  The trial court granted summary judgment in favor of the junior mortgagee, finding that it was entitled to coverage because the mechanics’ liens took priority over the junior mortgage.  Stewart Title Insurance Company had argued that the evidence in the record showed the senior mortgage consumed all of the property’s equity and therefore the junior mortgagee suffered no loss covered by the policy.  Stating that the issue was one of first impression in the state of Minnesota, the court of appeals reversed and remanded the matter back to the trial court for further findings regarding the property’s value.  In so doing, the court of appeals held that the junior mortgagee was required to show that its mortgage in fact secured equity in the property in order to show that actual loss occurred under the policy.  Eric Nasstrom argued the case at the court of appeals.

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