Supreme Court of Idaho
302 P.3d 1052 (2013)
Summit, Inc. owned a 142-acre parcel of land. Summit purchased an adjacent 18-acre parcel of land from Pat and Monica Gunter (defendants). Summit obtained a mortgage from Independent Mortgage Ltd. Co. (IM) to help pay for the 18 acres, but only for a portion of the purchase price. Both the 18-acre and the 142-acre tracts secured the mortgage. The mortgage was later assigned to Insight LLC (plaintiff). When IM signed the mortgage, it was aware Summit intended to sign a deed of trust to the Gunters for the remainder of the purchase price. Summit subsequently obtained a second loan from the Gunters in exchange for a deed of trust. The Gunters were not aware of the mortgage at the time. The IM mortgage was signed first and the Gunters’ deed of trust was signed later the same day. Both mortgages were recorded the next day, but the IM mortgage was recorded first. Summit defaulted on its obligations under both the mortgage and the Gunters’ deed of trust. Insight brought suit. The district court found the IM mortgage was not a purchase money mortgage because it was not part of the same transaction as the Gunters’ deed of trust. The district court also found the Gunters’ deed of trust had priority over the IM mortgage because the IM mortgage was not valid until the Gunters’ deed of trust closed and completed the transfer. Insight appealed.
Rule of Law
Holding and Reasoning (Jones, J.)
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