Mort v. United States
United States Court of Appeals for the Ninth Circuit
86 F.3d 890 (1996)
- Written by Rose VanHofwegen, JD
Facts
A trust borrowed $30,000 from Elwin and Jeanne Kern for a property mortgage. Then the Internal Revenue Service (IRS) filed a lien against the property for taxes the trust owed. To protect their own interest in the property, James and Carol Belmont loaned the trust money for another mortgage to pay off the Kerns’ mortgage and a state-tax lien. The title insurer failed to discover the IRS lien. The Belmonts assigned their interests to Jeffrey and Pamela Mort and others (plaintiffs). After the IRS seized the property, the Morts sued, asking the court to declare their interest superior to the IRS lien under equitable subrogation, meaning the Morts and Kerns held the same priority rights. The trial court dismissed, finding that the Morts could not claim equitable subrogation without first suing the title insurer.
Rule of Law
Issue
Holding and Reasoning (Zilly, J.)
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