2008-858, Land America Commonwealth Title Insurance Company v. Dorothy Kolozetski

whereupon the Newport Family Division issued a non-hypothecation order. Sugar River Bank (Sugar River). In 2005, Dorothy Kolozetski filed for divorce, joint tenants with rights of survivorship. They mortgaged their homestead to

(

by the record. Dorothy and John Kolozetski owned real property in Newport as The following facts were either found by the trial court or are supported

Commonwealth Title Insurance Company (Land America). We affirm. husband’s one-half interest in the marital residence to Land America Arnold, J.) order applying RSA 477:22 (2001) to award the proceeds of her HICKS, J. The defendant, Dorothy Kolozetski, appeals the Trial Court’s

Melanie Bell, of Newbury, on the brief and orally, for the defendant.

Hankin-Birke on the brief and orally), for the plaintiff. McSwiney, Semple, Hankin-Birke & Wood, P.C., of New London (Susan to press. Errors may be reported by E-mail at the following address:

page is: http://www.courts.state.nh.us/supreme. LAND AMERICA COMMONWEALTH TITLE INSURANCE COMPANY

No. 2008-858 editorial errors in order that corrections may be made before the opinion goes Sullivan Hampshire, One Charles Doe Drive, Concord, New Hampshire 03301, of any Readers are requested to notify the Reporter, Supreme Court of New ___________________________

a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh.us. Opinions are available on the Internet by 9:00

well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule 22 as for Lake Sunapee.

p. 2 insurance company that provided coverage to Lake Sunapee, substituted itself

the proceeds in the account. During these proceedings, Land America, a title

property to which Land America was entitled. litigation. Both Lake Sunapee and Dorothy Kolozetski claim the full amount of mortgage.” The trial court found John Kolozetski had a one-half interest in the $74,865.80 was placed in an escrow account pending the outcome of this and that $74,865.81 be given to Dorothy Kolozetski. The remaining

extent of Mr. Kolozetski’s interest in the property at the time he executed the

distributed to Lake Sunapee to offset its satisfaction of the Sugar River loan

has not repaid the Lake Sunapee mortgage. Sunapee intervened in the Kolozetskis’ divorce proceedings. John Kolozetski division found him in contempt of the court’s non-hypothecation order. Lake

tenant, the court ruled that “RSA 477:22 act[ed] to save the conveyance to the legally convey the entire property without his wife’s participation as joint superior court ordered that after taxes, fees, and other liens, $50,554.26 be Lake Sunapee by mortgaging the property for $150,000. While he could not 2 release her homestead rights. The real property sold for $225,000. The Sunapee agreed that she would convey the real property to a third party and

luxury vehicles, among other items. Based upon these actions, the family

escrow account. It reasoned that John Kolozetski had effected a conveyance to

liquidate the real estate. In lieu of a forced sale, Dorothy Kolozetski and Lake applying RSA 477:22 to award Land America one-half of the net proceeds. Her On appeal, Dorothy Kolozetski contends that the trial court erred in

balance to John Kolozetski. With these funds, he purchased a hot tub and two River $50,554.25 to satisfy the first mortgage and advanced the remaining Kolozetski and Lake Sunapee. Sunapee) secured by a mortgage on the property. Lake Sunapee paid Sugar

The trial court found that Land America should receive the money in the

money it loaned. As a part of this action, Lake Sunapee filed a motion to

superior court would resolve the debtor-creditor issues between Dorothy attorney, he obtained a loan of $150,000 from Lake Sunapee Bank (Lake

Subsequently, Lake Sunapee filed suit in superior court to recover the

Dorothy Kolozetski and Lake Sunapee. The final decree also stated the signature on a notarized power of attorney. With this fraudulent power of family division noted that the property would be sold by agreement between (2004). During the divorce proceedings, John Kolozetski forged his wife’s In 2007, the Kolozetskis divorced. In the final decree of divorce, the of any property” until the divorce decree has been executed. RSA 458:16-b, I

“transferring, encumbering, hypothecating, concealing or in any way disposing non-hypothecation order, with limited exceptions, enjoins any party from tenancy’s right of survivorship. p. 3 tenancy in common. His actions expressed a clear intent to terminate the joint 3

tenant does not agree severs the tenancy. which he did not have. have found encumbering the property with a mortgage to which the other joint encumber his wife’s property interest with a mortgage without her consent, mortgage. deed to obtain a second mortgage). John Kolozetski, however, could not

consent, John Kolozetski unilaterally severed the joint tenancy, resulting in a in the property without the other tenant’s consent or knowledge. § 51.04[1][c] (M. Wolf ed. 2009). The severance occurs because a mortgage in joint tenants without their consent.”). and Joint Ownership § 27 (2005); 7 R. Powell, Powell on Real Property Heritage Sav. Bank, 669 A.2d 185, 187 (Me. 1996); 20 Am. Jur. 2d Cotenancy

Indeed, in a mortgage title theory state, such as New Hampshire, other courts when he presented the forged notarized power of attorney to acquire the (1972) (requiring a joint tenant’s actions to display a clear intent to sever). interest in the property where husband forged wife’s signature on a quitclaim lawfully convey.” RSA 477:22. Here, we conclude John Kolozetski did just that Mamalis v. Bornavos, 112 N.H. 423, 426 a person purports “to convey a greater interest than he possessed or could

Further, by applying for the Lake Sunapee mortgage without his wife’s power to secure a loan with a mortgage only on his undivided one-half interest

(“A joint tenant cannot alienate, encumber, or transfer the interest of other 2004); First Nat. Bank v. Energy Fuels Corp., 618 P.2d 1115, 1118 (Colo. 1980)

(holding bank had a valid mortgage lien only against husband’s one-half RSA 477:22 indicates that the statute provides protection to the grantee when v. Ben. Finance Co. of Ill., Inc., 506 N.E.2d 1025, 1026-28 (Ill. App. Ct. 1987)

what he could “lawfully convey.” As a joint tenant, John Kolozetski had the interest than he possessed or could lawfully convey,” we first must establish To determine whether John Kolozetski purported to convey “a greater

the grantee all the estate which he could lawfully convey.” A plain reading of or could lawfully convey, shall not work a forfeiture thereof, but shall pass to interest in an estate, purporting to convey a greater interest than he possessed RSA 477:22 provides, “A conveyance made by a person having a limited

provision, not in isolation, but together with all associated sections. Id. interpret a statute to lead to a reasonable result and review a particular have said or add language that the legislature did not see fit to include. Id. We from the statute as written and will not consider what the legislature might and ordinary meaning to the words used. Id. We interpret legislative intent 6, 9 (2008). When examining the language of the statute, we ascribe the plain is a question of law, which we review de novo. MacPherson v. Weiner, 158 N.H. argument requires us to construe RSA 477:22. The interpretation of a statute interest.”

p. 4 not mean that he did not possess a “lawful interest” or a “lawfully conveyable fact that John Kolozetski violated the non-hypothecation order, however, does identified items that he purchased with the proceeds from the mortgage. The

of court punishable by imprisonment, a fine, and/or attorney’s fees. argument fails. A violation of a non-hypothecation order constitutes contempt interests of the parties at the time he acquired the second mortgage. This

ordered him to deliver possession and control to Dorothy Kolozetski of the

possessed or could lawfully convey.” interest in an estate,” purported to “convey a greater interest than he reconsideration of the underlying subrogation claim. 4 Therefore, in light of this agreement, we decline to remand this case for $50,554.26 from the sale of the house would satisfy the underlying loan.

had issued a non-hypothecation order and had not determined the relative

458). Indeed, here the marital court held John Kolozetski in contempt and

tenancy. Therefore, John Kolozetski, a joint tenant or a person with “a limited

superior court awarded to Land America. The parties had agreed that the first

“lawful interest” or a “lawfully conveyable interest” because the family court

costs and attorney’s fees for failure to obey order or decree under RSA chapter actions); see also RSA 458:51 (2004) (permitting court to award reasonable v. Duval, 114 N.H. 422, 425 (1974) (defining civil and criminal contempt property held as joint tenants, not just his undivided one-half share of the Cf. Duval Kolozetski possessed his wife’s permission to give a mortgage on their entire name, place and stead.” This fraudulent power of attorney signified that John the underlying loan – the contested $74,865.80 held in escrow that the equals one-half of the proceeds from the sale of the house after satisfaction of only his undivided one-half interest in the property. This one-half interest apply, which we will now address. The first is that John Kolozetski lacked a Kolozetski presents a number of specific reasons why the statute does not In addition to arguing generally that RSA 477:22 does not apply, Dorothy

“attorney, with full power of substitution and revocation, for [her] and in [her]

grantor “could lawfully convey.” Here, John Kolozetski could lawfully convey Pursuant to RSA 477:22, the grantee receives all of the estate that the

interest in the tenancy in common.

with a notarized forged power of attorney appointing him as his wife’s obtain the Lake Sunapee mortgage loan, John Kolozetski presented the bank We next must determine what John Kolozetski purported to convey. To

Therefore, John Kolozetski could only convey title to his one-half undivided Lightcap, 19 p. 5 5 U.S. 1, 17-18 (1904); 54A Am. Jur. 2d Mortgages § 136 (2009). to the mortgagee; the mortgagor, however, retains equitable title. Bradley v. theory is a conditional conveyance that passes legal title to the property in fee 5

the trial court or in her notice of appeal; therefore, we decline to address it. upon the record before us, Dorothy Kolozetski did not make this argument to refinancing the marital home at the expense of the innocent spouse. Based

concurred.

should not be rewarded for its “fail[ure] to exercise due diligence” when

obtained the mortgage loan. He could not convey her interest. BRODERICK, C.J., and DALIANIS, DUGGAN and CONBOY, JJ.,

See Bean v. Red Oak Prop. Mgmt., 1 p. 5 51 N.H. 248, 250 (2004).

upon a number of inapposite cases from other jurisdictions. property, particularly her homestead right. To make this argument, she relies Third, Dorothy Kolozetski argues that public policy dictates that a bank

and passed title only to his one-half interest in the marital property when he divested of her one-half interest in the property. John Kolozetski encumbered Fast, 208 N.W. 964 (Neb. 1926). Here, however, Dorothy Kolozetski was not Howell v. McCrie, 14 P. 2 p. 5 57 (Kan. 1887); David City Building & Loan Ass’n v. 564 So. 2d 1087 (Fla. 1990); Fitzgerald, Trustee v. Goff, 99 Ind. 28 (1884); Bank, N.A. v. Sapp, 554 So. 2d 1193 (Fla. Dist. Ct. App. 1989), review denied,

power of attorney cannot validly convey title and divest her of her rights to the Second, Dorothy Kolozetski contends that a forged mortgage and forged