Regions Bank v. Strawn

In 2003, Marie Borchers purchased the home at the heart of this controversy from Cammie Strawn. Cammie acquired the home, by deed, from her then-husband, Richard Strawn. Richard Strawn had previously given a mortgage to Regions Bank to secure a line of credit. At the time that the house was sold to Marie Borchers, there was an outstanding balance. On the day of closing, Marie Borchers' attorney had an employee deliver a payoff check and a mortgage satisfaction transmittal letter to Regions Bank. The check had the words "Payoff of first mortgage" typed on it. Regions Bank applied the check to the line of credit debt bringing its balance to zero; however, Regions Bank did not satisfy the mortgage. Instead, Regions Bank provided Richard Strawn with new checks on the line of credit even though the public record reflected that Richard Strawn had not owned the property for more than two years. Richard Strawn accrued new debt in excess of $72,000. Regions Bank attempted to collect Strawn's debt by foreclosing on the Borchers' home. The Borchers counterclaimed seeking to recover damages from Regions Bank pursuant to section 29-3-320 of the South Carolina Code based on the bank's failure to enter satisfaction of the mortgage within the three-month time period required by section 29-3-310. The trial court granted the Borchers' motion. Citing admissions from Regions Bank employees, the trial court concluded that based on "these admissions by the Bank it is clear that the closing day payoff should have been processed as a payoff instead of a paydown and that the bank should have had the mortgage satisfied of record." Additionally, the court specifically cited section 29-3-320 and its imposition of liability for mortgage lenders that do not satisfy mortgages within three months after payoff. Regions Bank appealed, and the Court of Appeals affirmed. Finding no reversible error, the Supreme Court also affirmed. View "Regions Bank v. Strawn" on Justia Law