In re: ThompsonÂ
253 N.C. App. 46
| N.C. Ct. App. | 2017Background
- Vicque and Christalyn Thompson bought 303 Old Pine Ct., Richlands, NC, in 2007 and secured the purchase with a deed of trust to finance a $205,850 loan from USAA Federal Savings Bank (the Bank).
- The Thompsons defaulted (first missed payment due 1 Sept 2013); the Bank mailed default and pre-foreclosure notices and appointed Trustee Services of Carolina, LLC as substitute trustee in July 2015.
- Substitute trustee filed for a foreclosure hearing; the Onslow County Clerk authorized foreclosure after a November 2015 hearing; Thompsons appealed to superior court for a de novo hearing.
- At the superior-court hearing, the Thompsons argued the deed of trust was void because it misidentified the subdivision section (it said “Section II-C” when the correct plat shows “Section III-C”), so the Bank never acquired legal title and lacked the right to foreclose.
- The deed of trust nonetheless included the street address, tax parcel ID, and a plat reference (Map Book 51, Page 149, Slide L-1485) that correctly identified Lot 46; the trial court allowed foreclosure and the Thompsons appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a scrivener error in the deed of trust (misnaming subdivision "Section II-C" instead of "III-C") voids the deed and defeats the Bank's right to foreclose | The misdescription is fatal: the deed of trust fails to convey legal title and thus the Bank has no right to foreclose | The error is a latent ambiguity/scrivener's mistake; extrinsic evidence in the deed (plat reference, address, tax parcel) renders the property certain and the deed valid | Court held the error was a latent ambiguity/scrivener's error that could be resolved by extrinsic references; foreclosure allowed |
Key Cases Cited
- Michael Weinman Associates v. 333 N.C. 221 (N.C. 1993) (power-of-sale trustee authority under deed of trust explained)
- Kidd v. Early, 289 N.C. 343 (N.C. 1976) (statute of frauds requires description of land that is certain or susceptible of identification by extrinsic reference)
- Patton v. Sluder, 167 N.C. 500 (N.C. 1914) (contract to convey land must contain description certain in itself or renderable certain by extrinsic source)
- Lane v. Coe, 262 N.C. 8 (N.C. 1964) (distinguishing patent vs latent ambiguity; parol evidence admissible for latent ambiguities)
- River Birch Associates v. City of Raleigh, 326 N.C. 100 (N.C. 1990) (preliminary plat admissible to resolve latent ambiguity in property covenants)
- Duckett v. Lyda, 223 N.C. 356 (N.C. 1943) (presumption that grantor intended to convey; deeds upheld where identification possible)
- Taylor v. Bailey, 34 N.C. App. 290 (N.C. Ct. App. 1977) (latent ambiguity created by incorrect county resolved by other documentary references)