548 B.R. 155
Bankr. E.D. La.2016Background
- Bellaire Property at issue; Debtor D’Anna purchased from Feingerts and Trusts via a 2009 sale.
- Feingerts argued he held a 1/6 interest in the property through the Trusts and succession.
- Sale was closed by Crescent Title; Fidelity issued a Title Policy insuring D’Anna.
- Gulf Coast/BANA Note and Mortgage secured purchase; D’Anna defaulted in 2014.
- State court proceedings and bankruptcy cases (15-1018, 15-1045) followed with related third-party demands.
- Court held Feingerts lacked authority to convey Feingerts’ 1/6 share; rescission and damages awarded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Feingerts' ownership | D’Anna argues Feingerts owned 1/6 via Trusts terminated by 31st birthday. | Feingerts contends he remained owner and trustee with authority to sell. | Feingerts owned 1/6; sale unauthorized; rescission warranted. |
| Public records and trust termination | Public records show termination date and authority failed to align with sale. | Trust termination not required to be recorded to affect third parties under prior law. | Prior to 8/1/2015 no formal termination recording required; Defendants’ reliance rejected. |
| Warranty of eviction and rescission | Seller breached eviction warranty by transferring interest without authority. | Succession/Trusts contested authority; eviction damages not payable or limited. | Succession breached eviction warranty; rescission with damages awarded. |
| Fidelity title policy liability | D’Anna seeks full policy-based recovery for actual loss due to title defect. | Fidelity argues issues ripe only when cure fails; policy limits apply. | D’Anna entitled to Title Policy—amount up to $261,703.20; costs and fees adjust per policy. |
Key Cases Cited
- McDuffie v. Walker, 125 La. 152 (La. 1909) (public records doctrine background for third-party rights)
- Camel v. Waller, 526 So.2d 1086 (La. 1988) (recording requirements; negative relief of public records)
- Judice-Henry-May Agency, Inc. v. Franklin, 376 So.2d 991 (La.App. 1 Cir. 1979) (on-record notice and third-party reliance limitations)
- Owen v. Owen, 336 So.2d 782 (La. 1976) (reliance on recorded sale and consideration; third-party rights)
- First American Bank v. First American Transp. Title Ins. Co., 759 F.3d 427 (5th Cir. 2014) (owner’s policy; market value vs actual loss considerations)
- Allison v. Ticor Title Ins. Co., 907 F.2d 645 (7th Cir. 1990) (date-of-discovery approach in owner’s policy context)
- Overholtzer v. Northern Counties Title Ins. Co., 116 Cal.App.2d 113 (Cal. App. 1953) (title insurance and actual loss considerations)
- W. Feliciana Acquisition, LLC, 744 F.3d 352 (5th Cir. 2014) (title insurer liability scope and limits)