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Deutsche Bank National Trust Co. v. Arrington

Supreme Court of Virginia

June 4, 2015

DEUTSCHE BANK NATIONAL TRUST COMPANY, AS TRUSTEE FOR SOUNDVIEW HOME LOAN TRUST 2006-WF2, ETC., ET AL.
v.
LYNORE ARRINGTON

As Corrected July 10, 2015.

FROM THE CIRCUIT COURT OF BEDFORD COUNTY. James W. Updike, Jr., Judge.

Samuel J. Kaufman (Jeremiah M. Yourth; Owen & Owens, on briefs), for appellants.

George I. Vogel, III (Frank K. Friedman; Erin B. Ashwell; Vogel & Cromwell; Woods Rogers, on brief), for appellee.

OPINION

Page 572

PRESENT: All the Justices

WILLIAM C. MIMS, JUSTICE.

In this appeal, we consider whether Code § 55-52, which codifies the doctrine of after-acquired title, retroactively cures a title defect in a deed of trust to subject the interest of a subsequent purchaser without notice or a lien creditor to the deed of trust. We also consider whether a party who acquires a deed of trust pursuant to a court order is a lien creditor, and whether a prior deed of trust recorded outside a party's chain of title is " duly admitted to record" for purposes of Code § 55-96(A).

I. BACKGROUND AND MATERIAL PROCEEDINGS

Lynore Arrington (" Arrington" ) was married to William Plucky (" Plucky" ) from 1992 to 2004. While married, they acquired property located at 113 Waters Edge in Moneta (the " Property" ) as tenants by the entireties with the right of survivorship by general warranty deed. On November 17, 2004, the Circuit Court of Franklin County entered a final decree of divorce dissolving the marriage. The decree affirmed and incorporated a separation and property settlement agreement under which Plucky acquired the Property and agreed to pay Arrington $11,000 per year for a period of ten years beginning in January 2006. Arrington conveyed her interest in the Property to Plucky by deed of gift executed on July 15, 2004 and recorded on July 29, 2004.

On July 7, 2005, Plucky conveyed the Property to Donald L. Riemenschneider (" Riemenschneider" ) by general warranty deed, which was recorded on July 12, 2005. Then on August 22, 2006, Plucky executed a deed of trust (" Deutsche Bank Deed of Trust" ) purporting to convey the Property in trust to secure a note for $675,000, currently held by appellant Deutsche Bank National Trust Company.[1] The Deutsche Bank Deed of Trust was not recorded until May 21, 2008.[2]

Page 573

On March 19, 2009, Plucky executed a deed of trust in favor of Arrington (" Arrington Deed of Trust" ) to purge a contempt order entered by the Circuit Court of Franklin County. The contempt order was entered following Plucky's " failure to pay the debts as set forth in the divorce decree," as well as additional debts set forth in an order entered December 4, 2008. The circuit court ordered Plucky to execute the Arrington Deed of Trust and pay $2000 per month to Arrington's attorney " until the sums referred to in the prior Orders and the deed of trust are paid in full." The Arrington Deed of Trust states that it secures " the payment of certain Court ordered obligations set forth in Orders entered by the Circuit Court of Franklin County on November 17, 2004, December 4, 2008, and March 19, 2009."

On July 6, 2009, Riemenschneider executed a general warranty deed re-conveying the Property to Plucky. This deed was recorded on July 17, 2009 at 1:10 p.m. At 1:11 p.m. on July 17, 2009, Arrington recorded her deed of trust along with copies of the final decree ...


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