Submitted: April 24, 2014
On Appeal from a Decision of the Court of Common Pleas.
David E. Matlusky, Esquire, The Matlusky Firm, LLC, 1423 North Harrison Street, Wilmington, DE 19806, Attorney for Appellant.
Patrick Scanlon, Law Offices of Patrick Scanlon, P.A., 203 NE Front Street, Suite 101, Milford, DE 19963, Attorney for Appellee.
This case comes before this Court on appeal from the Court of Common Pleas. It involves a a priority dispute between Plaintiff-Appellee CACH, LLC ("CACH"), a judgment lien holder against Aaron Johnson, Jr., and Defendant-Appellant Eastern Savings Bank, FSB ("Eastern"), a junior mortgage lien holder that foreclosed on the Johnson property. Following a lengthy procedural history, including a remand from the Supreme Court of Delaware, the Court of Common Pleas was presented with the singular issue of whether the doctrine of equitable subrogation should be applied to this case to advance Eastern's priority position which would allow them to retain funds from the Johnson property's mortgage foreclosure sale. The Court of Common Pleas found that the doctrine of equitable subrogation does not apply to this case. For the reasons set forth below, this Court finds that the Court of Common Pleas did not commit legal error in its ruling. Therefore, the decision of the Court of Common Pleas is AFFIRMED.
STIPULATED FACTUAL HISTORY
In the instant action, the parties have stipulated to the following chronology of relevant facts:
12/07/06 Plaintiff, CACH, LLC, obtained a judgment against Aaron Johnson, Jr. in the Court of Common Pleas, in and for New Castle County (C.A. No. 2006-08-238)
12/19/06 December 19, 2006, Aaron Johnson, Jr. executed a Deed conveying his property at 19 Sanford Drive, Newark, Delaware to himself and his wife, Angela, as tenants by the entireties. The law firm of The Matlusky Firm, LLC represented both the seller, Aaron Johnson and the buyers Aaron Johnson and his wife Angela.
12/19/06 Aaron Johnson, Jr. and Angela Johnson executed a Mortgage to Eastern Savings Bank, FSB on December 19, 2006 for the sum of $168, 000.00. As part of the refinance, two mortgages in the amount of $106, 902.00 to Wilmington Trust Company dated 6/29/99 and $23, 724.40 to Pacific Shore Funding dated 7/25/2002 were paid and satisfied out of the mortgage proceeds provided by Eastern Savings Bank. Three judgments were also paid in the following amounts: $16, 838.31 to Norman E. Lavine dated 6/7/04, $299.85 to State of Delaware dated 9/27/06, and $715.00 to First Premier Bank dated 3/10/2006. The CACH judgment was not paid or satisfied during the refinance.
12/21/06 Plaintiff, CACH, LLC transferred the judgment to Superior Court in and for New Castle County (JD #06J-12-467), and had it duly recorded on December 21, 2006. On December 21, 2006, the legal owner of the property according to the records on file at the Recorder of Deeds Office in New Castle County was Aaron Johnson, Jr.
12/29/06 Deed conveying property at 19 Sanford Drive, Newark, Delaware from Aaron Johnson, Jr. to Aaron Johnson, Jr. and his wife, Angela, at T x E was recorded ten days after the date of settlement.
12/29/06 Mortgage from Aaron Johnson, Jr. and Angela Johnson to Eastern Savings Bank, FSB was recorded.
12/29/06 At the time of recording a bring-down search was done by Global Title. The law office and the title company took no action at that time.
1/25/07 Aaron Johnson's mortgage to Pacific Shore Funding, duly recorded on 7/25/02, was satisfied of record as a result of the payoff as part ...