Hair v. Schellenberger
966 N.E.2d 693
Ind. Ct. App.2012Background
- Hair obtained a 2006 money judgment against the Adejares, later indexed in 2009, which raised a cloud on the Talbott Street Property title.
- The Talbott Street Property had been conveyed to the Aaron et Mosley Land Trust in 2005-2006, then foreclosed by Deutsche Bank in 2006.
- Schellenberger purchased the property at foreclosure in 2007 and recorded deed in 2007, relying on Lawyers Title to search the title chain.
- Hair asserted a judgment lien against the property, but the lien was not of record or indexed in the county records at the time of Schellenberger’s purchase.
- The trial court granted summary judgment for the Appellees, concluding Schellenberger was a bona fide purchaser (BFP) and Hair’s lien was void as to priority.
- Hair appeals, challenging both the failure to recognize fraudulent conveyance and the BFP ruling, while the Appellees seek affirmance.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Hair’s fraudulent conveyance claim is time-barred under UFTA. | Hair contends the transfer was within the statutory window and discovery occurred timely. | Schellenberger and others argue the claim is untimely and barred by the four-year/one-year limitations. | Yes; Hair’s fraudulent conveyance claim is time-barred. |
| Whether Schellenberger is a bona fide purchaser free of Hair’s lien claim. | Hair asserts the lien attaches and survives as a superior claim. | Schellenberger, as BFP, did not have notice of Hair’s recorded interest and records supported the purchase free of the lien. | Yes; Schellenberger is a BFP and Hair’s lien is nullified. |
Key Cases Cited
- Edwards v. Haverstick, 53 Ind. 348 (Indiana 1876) (fraudulent transfers bearing on creditor rights; conveyance issues under UFTA context)
- Nally v. Bank of New York, 820 N.E.2d 648 (Ind. 2005) (BFP status; notice from chain of title; record-notice rule)
- Szakaly v. Smith, 544 N.E.2d 490 (Ind. 1989) (records outside chain do not provide notice to BFPs)
- Sullivan State Bank v. First Nat’l Bank, 146 N.E.2d 403 (Ind. App. 1925) (judgment liens created by statute; lien timing and indexing requirements)
- Thomas v. Thomas, 923 N.E.2d 465 (Ind. Ct. App. 2010) (BFP protections extend to mortgagees; chain-of-title notice)