BCP HOLDINGS (USA), INC. f/k/a MILLENNIUM BCPBANK, N.A., Plaintiff-Appellant,
FIRST AMERICAN TITLE INSURANCE COMPANY, Defendant-Respondent, and SOCIETY HILL TITLE AGENCY, INC., Defendant.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued October 9, 2013
On appeal from the Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-7324-08.
Daniel J. Cohen argued the cause for appellant (Newman & Simpson, LLP, attorneys; Mr. Cohen and Sabina P. McKinney, of counsel and on the briefs).
William C. Sandelands argued the cause for respondent (Sandelands Eyet LLP, attorneys; Mr. Sandelands, of counsel and on the brief; Maria A. Kershaw, on the brief).
Before Judges Grall, Waugh, and Nugent.
Plaintiff Millennium bcpbank, N.A. (Millennium), appeals the Law Division's October 2, 2012 order granting summary judgment to defendant First American Title Insurance Company (First American). We reverse.
We discern the following facts and procedural history from the record on appeal.
Millennium is a mortgage lender. In December 2005, it made a $400, 000 construction loan to Antonio Pinto and his wife Ana. Vouga Builders, LLC (Vouga), of which Antonio was the principal, guaranteed the loan. As security for the loan, Millennium received mortgages on two parcels of real property located in Newark, one owned by Vouga and the other by Antonio. At the time it was making the loan, Millennium ordered a title policy from First American, through its agent, co-defendant Society Hill Title Agency, Inc. (Society Hill), to cover the mortgages on both parcels effective December 30, 2005.
Millennium's credit administrator prepared the mortgages and supporting documentation. In drafting the mortgages, she switched the owners' names. As a result, the mortgage on the property owned by Vouga identified Antonio as the owner, and the mortgage on the property owned by Antonio identified Vouga as the owner. The names of the property owners were transposed on several additional documents.
The errors were not discovered during the closing on December 30, the date on which the title policy was issued. Millennium sent the defective mortgages to the county clerk for recordation. On February 28, 2006, Millennium forwarded copies of the closing documents, including the two defective mortgages, to Society Hill.
In September 2006, Vouga conveyed title of its property to Ana. In November, Ana conveyed title of the property to third parties. The title search performed by the purchasers did not disclose Millennium's mortgage, which had been indexed under the incorrect name due to the drafting error.
In 2008, the third-party purchasers discovered the existence of the Millennium mortgage involving their property. They instituted a quiet-title action against the Pintos, Vouga, and Millennium. Millennium learned of the drafting error and problems with ...