Guerrero v. Howard Bank

Dist. Ct. did not err in dismissing plaintiffs’ slander of title and unjust enrichment actions, arising out of defendant-bank’s recording of mortgage lien it held on plaintiffs’ property. Record showed that: (1) plaintiffs and another sibling were beneficiaries of trust that held title to property; (2) prior to trust grantor’s death, sibling convinced grantor to make sibling sole beneficiary of trust, with sole power of discretion; (3) plaintiffs brought undue influence claim against sibling in state court to re-establish their interests in property; (4) state court rendered money judgment against sibling; (5) sibling thereafter directs trustee to issue trustee deed to sibling’s daughter; (6) sibling's daughter thereafter obtained mortgage loan from defendant, using property as collateral; (7) state reviewing court subsequently affirms money judgment against sibling and imposes retroactive constructive trust, but declines to rule in rights of any third-party to property; and (8) plaintiffs sell property and pay off mortgage. Plaintiff’s slander of title fails because defendant held valid mortgage to property, where sibling’s daughter held valid title to property at time of mortgage. Moreover, plaintiffs’ unjust enrichment claim, which was based on contention that defendant had refused plaintiffs' request to release mortgage prior to payoff, fails since plaintiffs took title to property subject to valid mortgage, which was continuing security interest on said property.