Articles Posted in Real Estate & Property Law

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Two property insurers issued policies to a Harris Teeter grocery store. The insurers together paid claims for property damage resulting from the malfunctioning of a county sewer line. Exercising their subrogation rights, the insurers sued Arlington County alleging an inverse condemnation claim under Va. Const. art. I, section 11. The circuit court dismissed the case with prejudice. The Supreme Court affirmed in part, reversed in part, and remanded for further proceedings, holding (1) the circuit court did not err in concluding that the original complaint failed to state a viable legal claim for inverse condemnation; but (2) the court erred in denying the insurers leave to amend their complaint because the allegations in the proffered amended complaint, combined with the reasonable inferences arising from them, asserted a legally viable claim for inverse condemnation. Remanded. View "AGCS Marine Insurance Co. v. Arlington County" on Justia Law

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A declaration of protective covenants and restrictions (Declaration) for a Subdivision created a Committee, an unincorporated association, to have full authority to enforce the Declaration. In 2014, an amendment of the Declaration was recorded in the name of the lot owners and the Subdivision’s home owners association (Association) asserting that the Declaration could be amended by two-thirds of the lot owners. The amendment was signed by all the lot owners except Plaintiffs. Plaintiffs filed a complaint asserting that the Declaration could be amended only with the unanimous consent of all the lot owners. Thereafter, another amendment was signed by all the lot owners except Plaintiffs asserting that the Association was created by the Declaration. Plaintiffs amended their complaint to seek a declaratory judgment that both amendments were invalid. The circuit court ruled in favor of Plaintiffs. The Supreme Court reversed in part, holding that the circuit court (1) erred in ruling that the Declaration did not create a property owners’ association within the meaning of the Virginia Property Owners’ Association Act; (2) erred in ruling that the amendments may not be adopted by a two-thirds majority vote; and (3) did not err in finding that the Association was not a property owners’ association within the meaning of the Act. View "Shepherd v. Conde" on Justia Law

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Martha Lambert filed a warrant in debt asserting that the Sea Oats Condominium Association failed to pay $500 to repair an exterior door to her condominium. Lambert sought $500 in damages and an award of attorney’s fees. The general district court entered judgment for the Association. The circuit court awarded judgment to Lambert. The court then entered a corrected final order awarding Lambert $500 in damages and $375 in attorney’s fees. Lambert appealed, arguing that the circuit court erred by awarding her only $375 in attorney’s fees. The Association asserted that the circuit court erred by awarding Lambert attorney’s fees at all. The Supreme Court affirmed in part and reversed in part, holding (1) the circuit court abused its discretion by failing to consider relevant factors in its attorney’s fees award that should have been given significant weight; and (2) a party seeking an award of attorney’s fees need not prove the reasonableness of the award in its prima facie case. Remanded. View "Lambert v. Sea Oats Condominium Ass'n" on Justia Law

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The predecessor in title to Mount Aldie, LLC (MA) conveyed a conservation easement to Land Trust of Virginia, Inc. (LTV) covering a sixty-acre tract of land. The easement designated a 100-foot-wide strip of property running along the edge of the Little River, as “riparian buffer” (the buffer). After acquiring the property and conducting certain commercial forest operations, MA performed tree removal and grading work within the buffer. LTV later filed this action seeking an injunction to require MA to return certain property to the condition that it was in prior to the work MA performed within the buffer on grounds that MA breached the easement. The trial court granted LTV’s motion for partial summary judgment on the issue of liability, finding that MA breached a provision of the easement. The Supreme Court reversed, holding that genuine issues of disputed material fact existed over whether MA breached the easement, thereby precluding an award of partial summary judgment to LTV. Remanded. View "Mount Aldie, LLC v. Land Trust of Virginia, Inc." on Justia Law

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Ravi Prasad purchased a lot at a tax sale. Shorty thereafter, Appellee mistakenly began renovating a house on a nearby lot owned by William and Elnora Washington, spending more than $23,500 on the renovations. When the Washingtons refused to pay Appellee for the work he procured for their house, Prasad filed a complaint asking the circuit court to impose a constructive trust on the Washingtons’ lot. Specifically, Prasad alleged that the Washingtons had been unjustly enriched as a result of fraud perpetrated by them through misrepresenting the address of the house. The circuit court entered a decision in favor of Prasad and imposed a constructive trust on the Washingtons’ lot in favor of Prasad with a money judgment in the amount he expended on the house. The Supreme Court reversed and entered final judgment for the Washingtons, holding that under long-standing common law principles regarding notice imputed to purchasers of real property, because it was Prasad’s failure to exercise due diligence in his purchase of his lot that resulted in his misidentification of the Washingtons’ parcel as the property he was purchasing, Prasad was not entitled to recover compensation for the permanent improvements he made on the premises. View "Washington v. Prasad" on Justia Law

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In 2004, the prior owner of certain property acquired title to the property and granted a deed of trust on the property to Bank of America. The City of Portsmouth subsequently created the New Port Community Development Authority (CDA), which included the property at issue. In 2006, the CDA authorized the issuance of special assessment bonds, and the City enacted an ordinance establishing special assessments on properties in the CDA district. The prior owner subsequently subdivided the property and sold individual lots. In 2011, Bank of America sold the notes it held to Plaintiff and assigned it the deed of trust. Following the prior owner’s default, the property was foreclosed upon, and Plaintiff was the successful bidder. Plaintiff then filed suit, claiming that the special assessment lien was extinguished by the foreclosure sale and that the special assessments should be declared void because no CDA bond funds remained to construct additional improvements. The circuit court dismissed the complaint with prejudice. The Supreme Court affirmed, holding that a special assessment lien has priority over a deed of trust that was recorded before the special assessments, and therefore, Virginia law foreclosed Plaintiff’s challenge. View "Cygnus Newport-Phase 1B, LLC v. City of Portsmouth" on Justia Law

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In 1989, Dorothy Hamm executed a deed of gift transferring her one-half interest in a parcel of property to Melba Clark. The deed of gift reserved a life estate for Dorothy. Dorothy died in 2004. In her will, Dorothy left any interest she had in the property to her son, Edward Hamm. In the deed of gift, Dorothy included a provision that sought to create a contingent reversionary interest in Dorothy in the event that Melba’s son, Reginald Clarke, ever acquired any interest in the property. Melba later died intestate, and the administrator of her estate sought a declaration that the possibility-of-reverter provision in the deed was void as an impermissible restraint on alienation. The circuit court agreed and struck the possibility of reverter from the conveyance. The Supreme Court reversed, holding that the circuit court erred in declaring the possibility-of-reverter provision to be void, as no rule of law or equity forbade Dorothy from making her conveyance subject to the condition that the conveyance to Melba would revert if Reginald ever acquired any interest in the property. View "Hamm v. Hazelwood" on Justia Law

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In 2014, the trustee under a deed of trust conveyed the Parrish property to the Federal National Mortgage Association (Fannie Mae), which sent the Parrishes a notice to vacate and filed a summons for unlawful detainer in the general district court. The Parrishes alleged that the foreclosure was invalid because their deed of trust incorporated 12 C.F.R. 1024.41(g), which, they asserted, prohibits foreclosure if a borrower submitted a completed loss mitigation application more than 37 days before the foreclosure sale. They alleged that they had submitted such an application. The court awarded Fannie Mae possession. On appeal, Fannie Mae argued that the court should exclude any defense contesting the foreclosure’s validity because the lower court lacked subject matter jurisdiction to try title in a proceeding on unlawful detainer. Fannie Mae contended that because the circuit court’s subject matter jurisdiction on appeal from the general district court was derivative of the general district court’s jurisdiction, the circuit court also lacked jurisdiction. The court awarded Fannie Mae possession. The Supreme Court of Virginia vacated, restoring the parties to their status quo before the unlawful detainer proceeding. Courts not of record lack power to try title unless expressly conferred by the General Assembly. The court cited Code sections 16.1-77(3) and 8.01-126 and acknowledged the practical implications of its holding. View "Parrish v. Fed. Nat'l Mortgage Ass'n" on Justia Law

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Dominion obtained necessary certificates for transmission lines to connect Dominion’s recently-approved Wise County power plant with an existing Russell County substation. In 2008, Dominion offered Hylton $19,100 to purchase a 7.88-acre easement. Hylton owned 354 acres across 20 contiguous and two non-contiguous tracts. He owned the surface and mineral rights of some tracts and only the mineral rights of others. Dominion included an appraisal, acknowledging that, according to Hylton, two major coal seams run through or near the property and that Hylton’s ability to sell or lease those mineral rights might be damaged. The appraisal did not consider mineral rights in determining fair market value. The parties signed an agreement granting Dominion the right to enter and construct the transmission line. Dominion filed its petition for condemnation, limited to the surface use of Hylton’s property and moved to prohibit Hylton from presenting evidence of “the separate value of coal,” damage to tracts not taken, and “damages for duplicative or inconsistent claims.” Hylton later moved to dismiss, arguing that Dominion’s pre-petition offer to purchase was not a bona fide offer, under Code 25.1-204, so that Dominion had failed to meet jurisdictional requirements for condemnation. The trial court dismissed and awarded Hylton attorneys’ fees. The Supreme Court of Virginia reversed the dismissal and the denial of Dominion’s motion in limine with regard to evidence related to the separate value of the coal and the potential surface mine. Because the issue of whether the unity of lands doctrine applies with respect to neighboring lands, not part of the taking, is a question of fact, denying the motion on that issue was appropriate. View "Va. Elec. & Power Co. v. Hylton" on Justia Law

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Powell owned property in Chesapeake, Virginia. In 2004, a developer, 3 MAC, bought her property for $265,000 and “one (1) lot to be mutually agreed upon by both Buyer and Seller in writing” to develop North Rollingwood Estates subdivision. In 2005, Powell and 3 MAC prepared an addendum, stipulating that Powell would receive the lot designated as Lot 1 on the preliminary subdivision plat. Several times over the next few years, Powell allegedly asked 3 MAC to convey Lot 1, but in 2012, 3 MAC sold the lot to Ashdon for $110,000. Powell sued, alleging breach of contract and fraudulent conveyance, and sought the imposition of a constructive trust upon Lot 1. After a settlement, the trial court dismissed Powell’s claim against Ashdon with prejudice, releasing Powell’s claim to Lot 1. Powell asked the court to impose a constructive trust upon the remaining land owned by 3 MAC that had not yet been sold, “Lot A,” which was subject to the Bank’s recorded first-lien deed of trust. The court held that the Bank had constructive knowledge of Powell’s rights and imposed the constructive trust. The Supreme Court of Virginia reversed and entered judgment for Powell in the amount of $110,000. Powell failed to distinctly trace her claim to the property that was the subject of the constructive trust. View "Bank of Hampton Roads v. Powell" on Justia Law