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Abuse victim settles with lender, title company

When the fate of Charles Lee Petr’s house remained up in the air last year, the young woman he impregnated when she was 14 was hopeful but realistic.

Petr, once the middle-aged boyfriend of Mary’s aunt, is serving 20 years in prison after pleading guilty to second-degree rape in 2006. Mary obtained a $2 million civil judgment against him the following year; the Dundalk house was Petr’s only asset.

“I know it’s a slow process, but I believe that something’s going to come out of it,” Mary said last year. “If it’s no money, it’s no money. If it’s money, it’s great. We’re certainly hoping for the best.”

Arguments in the Court of Appeals were scheduled for Monday.

On Friday, though, Mary reached a settlement with the out-of-state title company and the national bank that claimed the priority lien on the home. Terms of the agreement were confidential, lawyers involved said.

“Mary is very happy with the settlement,” said her lawyer, John J. Condliffe of Shub-Condliffe, Condliffe & Silverstein P.A. in Towson.

Richard Grason VI, the lawyer for Chicago Title Insurance Co. and its insurer, U.S. National Bank N.A., also expressed satisfaction in the outcome.

“Mary is a very successful, bright and confident young woman and we wish her well in all her future endeavors,” said Grason, of The Law Offices of T. Bruce Hanley in Towson.

At issue in the case was the timeline of events that began in 2005, when Petr refinanced his existing mortgage and signed a $150,000 deed of trust on the property. The deed of trust was not recorded at that time.

The verdict in Mary’s civil suit was entered in Baltimore County Circuit Court on May 11, 2007, and an Oct. 25 sale of Petr’s home was scheduled with Mary listed as the judgment creditor.

The 2005 deed of trust on the home was recorded Oct. 9, 2007, and Chicago Title filed suit 11 days later to stop the sale of Petr’s home.

Grason has said the delay between the time the deed of trust was signed and recorded was accidental and that the timing of the recording was coincidental to Mary’s case.

Mary argued Chicago Title’s lien was not effective until the deed of trust was recorded, giving her claim priority under the state’s real property law. Chicago Title and U.S. National Bank argued the lien was effective the day it was signed, giving its claim priority over the later judgment lien.

A Baltimore County judge sided with Mary in 2008. This January, though, the Court of Special Appeals reversed that decision.

“[T]he [deed of trust] was effective against Mary from July 15, 2005, which is almost two years before the date her judgment was rendered, irrespective of whether she knew about the DOT,” Judge Deborah S. Eyler wrote for the appeals court. “Thus, the DOT is a lien that takes priority over the judgment.”

Maria E. Chavez-Ruark, a bankruptcy lawyer who followed the case, said the appellate court ruling “came as a surprise” and impacts anyone who could become a creditor. Lawyers seeking a lien base their decision on whether they can win and collect, she said.

“We all rely on public records to determine if a property is free and clear,” said Chavez-Ruark, a partner at Tydings & Rosenberg LLP in Baltimore who also sits on the board of directors for the Bankruptcy Bar Association for the District of Maryland.

That Mary did not have notice of the claim also makes her case one of due process, Chavez-Ruark added.

“My hope is the General Assembly is paying attention and says, ‘This is not what was intended by the law,’” she said.

The case was Mary B. v. Chicago Title Insurance Company f/u/o U.S. Bank National Association, et al., No. 42 of the September 2010 term.