Pioneer Title v. Larue
1 CA-CV 24-0350
Ariz. Ct. App.May 20, 2025Background
- LaRue and her husband bought a house in 2007 and later jointly borrowed against it, secured by a deed of trust listing both as borrowers, with Broker Solutions, Inc. as the lender.
- In 2021, during the sale of the property, Pioneer Title served as escrow agent but failed to pay off the $163,124.36 mortgage at closing, mistakenly wiring this amount to LaRue in addition to her sale proceeds.
- Pioneer attempted to recover the funds after discovering the mistake but LaRue did not respond. Pioneer then paid off the mortgage itself.
- Pioneer filed suit for reimbursement under theories of equitable subrogation and unjust enrichment; LaRue counterclaimed for negligence, gross negligence, and breach of contract, arguing Pioneer’s error and breach of its duties.
- The superior court granted summary judgment for Pioneer on both its claims and LaRue’s counterclaims, as well as awarding attorney’s fees to Pioneer.
- LaRue appealed, arguing factual disputes and legal deficiencies in Pioneer’s pleadings and theories.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Equitable Subrogation | LaRue was unjustly enriched and must reimburse Pioneer. | Enrichment was justified; doctrine inapplicable due to Pioneer’s own error. | Equitable subrogation applies; LaRue must repay. |
| Sufficiency of Complaint | Facts sufficiently notified LaRue of subrogation theory. | Insufficient notice in complaint for equitable subrogation claim. | Notice requirements met; no prejudice to LaRue. |
| Negligence / Gross Negligence | LaRue sustained no damages; received a windfall, not a loss. | Pioneer’s error and contractual breaches damaged LaRue. | No legally cognizable damages; claims dismissed. |
| Breach of Contract (Closing Letter) | Failure to provide closing protection letter caused no loss; LaRue not entitled to keep overpayment. | Entitlement to keep funds due to Pioneer’s breach and lack of protection letter. | No damages caused by the omission; claim fails. |
Key Cases Cited
- Cullen v. Auto-Owners Ins. Co., 218 Ariz. 417 (notice pleading standard in Arizona)
- Gipson v. Kasey, 214 Ariz. 141 (negligence claim requires legally cognizable damages)
- Graham v. Asbury, 112 Ariz. 184 (elements of breach of contract)
- Mosher v. Conway, 45 Ariz. 463 (explains equitable subrogation)
- Markham Contracting Co., Inc. v. Fed. Deposit Ins. Co., 240 Ariz. 360 (equitable subrogation to prevent unjust enrichment)