Friday, August 28, 2009
Nebraska Supreme Court affirms summary judgment against Mortgage lender in its declaratory complaint and insurers' cross-complaint denying the mortgage lender a defense in borrower's fraud and slander of title lawsuit against it in Kentucky state court. Mortgage Express v. Tudor Ins. Co., S-08-728, 278 Neb. 449 Mortgage Express, Inc., and Jeff Rothlisberger, its sole shareholder (collectively Mortgage Express), seek a declaration that Mortgage Express liability insurers, Tudor Insurance Company (Tudor) and Cincinnati Insurance Company (Cincinnati) are obligated to defend Mortgage Express in a suit brought against it by a third party, Village Campground (Village). In December 2006, the court entered summary judgment in favor of Tudor and Cincinnati, thereby dismissing Mortgage Express’ action, and Mortgage Express appealed The court filed another order dismissing Peterson ( the defendant insurance broker), properly certifying the case as a final, appealable order, and Mortgage Express filed this appeal. We affirm. There is no genuine issue as to the fact Mortgage Express was unaware, prior to the effective date of the Tudor policy, of the circumstances leading up to the claims asserted in Village’s amended complaint. Therefore, the Tudor policy does not provide coverage for the defense sought by Mortgage Express. As to defending the Village's slander of title suit, "title to real estate is not a person, organization good, product, or service as those terms are commonly understood," thus, slander of title did not fall within the policy coverage of a good, product, or service as those terms are commonly understood," thus, slander of title did not fall within the policy coverage defendant provided to plaintiff. Mortgage Express’ remaining argument is that Cincinnati must defend it in the underlying action because its lien is an invasion of the right to private occupancy of the premises Mortgage Express merely asserted that it held a valid, unsatisfied security interest against the property. A security interest is an interest in personal property or fixtures which secures payment or performance of an obligation. As such, Cincinnati has no duty to defend Mortgage Express and was properly granted judgment as a matter of law.