PNC Bank, National Association v. Seminary Woods, LLC et al

Filing 296

MEMORANDUM OPINION signed by Senior Judge Charles R. Simpson, III on 11/2/2015. For the reasons set forth, PNC Bank's MOTION to Dismiss Count IX of the Risen Parties' First Amended Complaint 255 will be granted by separate order of the Court. cc: Counsel (RLK)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
AT LOUISVILLE

PNC BANK, NATIONAL ASSOCIATION

v.

PLAINTIFF

CIVIL ACTION NO. 3:13-CV-297-CRS

SEMINARY WOODS, LLC, et al.

DEFENDANTS

MEMORANDUM OPINION
This matter is before the court on motion of plaintiff PNC Bank, National Association to
dismiss Count IX of the First Amended Complaint of Seminary Woods, LLC, Seminary Woods
Condominiums Council of Co-Owners, LLC, Whittington Realty Partners, LLC, Norman E.
Risen, and Anna J. Risen (referred to herein as the “Risen Parties”).1
Count IX of the Risen Parties’ Amended Counterclaim seeks imposition of an equitable
lien on the mortgaged property superior to the interest of PNC to the extent of (1) their
expenditure of personal funds prior to the recording of the mortgage, and (2) interests held by
purchase contract holders assigned to Whittington Realty Partners, LLC or Norm Risen in
exchange for the return of purchase deposits.
To the extend the Risen Parties expended funds on their project prior to the recording of
the mortgage by PNC, they conveyed to PNC all “right, title and interest in and to . . . [a]ll
interests, estates or other claims, both in law and in equity, which Mortgagor now has or may

1

Other individuals formerly included among the “Risen Parties,” Kent E. Risen, Marc H. Risen, Linda Risen, Ronald Wise, and
Jennifer S. Wise have resolved their claims.

hereafter acquire in the Mortgaged Property. . .” to secure payment of the Note. DN 1-18,
PageID# 140.
As the above-cited provision also operates to convey to PNC any after-acquired interest,
it also covers the assigned interests of the purchase contract holders which the Risen Parties urge
entitle them to equitable liens. However, such an assignment of rights by purchase contract
holders is prohibited by the terms of the Loan Agreement which provides that “Borrower shall
not permit any purchaser to assign its agreement to purchase a Unit. . . . and any assignment
attempted without the prior written consent of the Lender shall be null and void.” DN 1-16,
PageID# 66. As there has been no suggestion that PNC gave any such written consent, the
assignments of the purchase contract holders’ interests which form the basis of the Risen Parties’
equitable lien claims are void by operation of the terms of the Loan Agreement.
In any event, Seminary Woods and the Guarantors released PNC from “any liability on
account of any and all claims, demands, actions, or causes of action, whether in law or in equity
or otherwise. . .” DN 1-32, PageID# 323. There is simply no valid claim by the Risen Parties
for imposition of equitable liens in this case.
Therefore, the motion of PNC Bank to dismiss Count IX of the Risen Parties’ First
Amended Counterclaim (DN 255) will be granted by separate order of the court.

IT IS SO ORDERED.

November 2, 2015

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