Recontrust Co., N.A. v. Zhang

Frank Sorichetti contracted Respondent to buy his property. Sorichetti reneged so Respondent sued and recorded a lis pendens against the property. Due to misinformation about the lis pendens, Countrywide Home Loans, Inc. loaned Sorichetti money secured by deeds of trust against the property. Sorichetti defaulted and Countrywide initiated foreclosure. Respondent sued Countrywide. Countrywide argued that it was entitled to equitable subrogation in amount of the sum that it had paid off in prior loans against the property. Eventually, the case reached the Supreme Court for a second time. In Zhang II, the Court reversed and remanded the case, determining that the district court erred in concluding that Respondent’s lis pendens should not be given priority over Countrywide’s deeds of trust. On remand, Countrywide asked for a decision on its equitable subrogation claim, which the district court declined to give because it was “not given jurisdiction to do so by the Supreme Court.” The Supreme Court subsequently vacated the district court’s judgment in favor of Respondent and remanded with instructions to decide Countrywide’s equitable subrogation claim, holding that the district court erred in failing to resolve the equitable subrogation issue. View "Recontrust Co., N.A. v. Zhang" on Justia Law