Maryland Legal Alert for Financial Services

In this issue:

• IF FORECLOSURE IS DISMISSED, NOTICES MUST BE REISSUED
• FOURTH CIRCUIT RULES FOR LENDER IN IRS TAX LIEN PRIORITY DISPUTE
• MARYLAND GENERAL ASSEMBLY CONVENES
• REMINDER: IT'S TIME TO FILE MARYLAND DISCLOSURE OF CONTRIBUTIONS

IF FORECLOSURE IS DISMISSED, NOTICES MUST BE REISSUED

On December 16, 2014, the Maryland Court of Special Appeals issued a decision in the case of Granados v. Nadel, et al., holding that where a foreclosure action was dismissed and then a new foreclosure action was filed regarding the same debtor, debt and property, the foreclosure trustees were required to issue a new Notice of Intent to Foreclose (NOI) between dismissal of the first foreclosure action and institution of the second. The new NOI must comply with the law in effect at the time it is given. The Granados decision supports a conclusion that a NOI which complies with the law in effect when the NOI is given will be legally sufficient for the related foreclosure action filed after the NOI was given (even if the law changes after the NOI was given). However, it will not be sufficient – regardless of whether there is a change in the law – for any other foreclosure action. As mentioned in our Special December 2014 Maryland Legal Alert, regulations containing revised foreclosure forms, including a revised NOI, become effective February 1, 2015. For more information concerning this case, please contact Margie Corwin or Bob Enten.

FOURTH CIRCUIT RULES FOR LENDER IN IRS TAX LIEN PRIORITY DISPUTE

On October 31, 2014, the Fourth Circuit Court of Appeals issued a decision which held that a secured party's mortgage lien was entitled to priority over a subsequent judgment lien arising out of an unsecured obligation, which included an IRS tax lien. Even though the Fourth Circuit's case affirmed an earlier decision of the United States District Court for the District of Maryland, the Court of Appeals rejected the District Court's reliance on Maryland's relation-back statute. Instead, the Court of Appeals agreed with the District Court's alternative reasoning that Maryland's doctrine of equitable conversion gave the mortgage lender priority over the IRS. For a more thorough discussion of this case, please click here. If you have any questions or comments, please contact Ed Levin.

MARYLAND GENERAL ASSEMBLY CONVENES

The 435th Session of Maryland's General Assembly begins on Wednesday, January 14, 2015. Bob Enten will be in Annapolis during the session as a full-time lobbyist representing the interests of our clients. The rest of our legislative team will work from both Annapolis and our offices in Baltimore. If you have any questions concerning this year's legislative session, please contact Bob Enten or Margie Corwin.

REMINDER: IT'S TIME TO FILE MARYLAND DISCLOSURE OF CONTRIBUTIONS

Maryland law requires a Disclosure of Contributions to be filed with the State Board of Elections by any person who compensates one or more lobbyists at least $500 and makes contributions in excess of $500 to a candidate or official holding the office of Governor, Lt. Governor, Attorney General, Comptroller or a member of the General Assembly during a 6-month reporting period (ending on January 31 and July 31 each year). Contributions are attributable to a business entity if made by: a subsidiary; an officer, director or partner of the business entity or subsidiary; a political action committee sponsored by the business entity; or, if at the direction of a business entity or subsidiary, an employee or agent of the business entity or subsidiary. It is our understanding that qualifying contributions by a political action committee controlled by another person, including an individual, trade association, or business entity, must be reported by the person in control. If filing is required, it must be made by February 5 and/or August 5. Please contact Bob Enten if you would like to discuss this subject in greater depth.