Firm News

Supreme Court of Virginia Limits Ability to Challenge Foreclosures

Posted on by Brigitte Flores

One of the risks involved with purchasing property at a foreclosure sale is that the prior owner may attempt to challenge the validity of the sale. Often, the challenge to the foreclosure sale is an attempt to avoid or delay eviction after the foreclosure, as the Supreme Court reviewed at length in its ruling in Parrish v. Fannie Mae, 292 Va. 44 (2016). These challenges may also result in a claim on the new owner’s title insurance policy.

On April 2, 2020, the Supreme Court of Virginia issued an opinion that clarifies and further limits the ability of a foreclosed property owner to rescind a completed foreclosure sale. In Young-Allen v. Bank of Am., N.A., 839 S.E.2d 897 (Va. 2020), a property owner in the City of Alexandria facing foreclosure requested a reinstatement quote from the lender prior to foreclosure. The lender did not respond to that request and, despite the property owner’s request that the lender postpone the sale to give her time to reinstate the loan, proceeded with the foreclosure.

On the day before the foreclosure, the property owner filed a suit in the Circuit Court of Alexandria alleging that: (i) the lender breached the terms of the deed of trust by failing to provide the requested reinstatement figures, (ii) the foreclosure trustee breached its fiduciary when it refused to cancel or postpone the scheduled foreclosure sale despite request, (iii) the lender did not have the authority to conduct the foreclosure sale, and (iv) requesting that the Circuit Court rescind any foreclosure sale that might occur during the pending litigation. The property owner also filed a memorandum of lis pendens in the land records of the City of Alexandria on the same day. The following day the trustee performed the foreclosure sale and the property was sold to a third-party bidder.

Following the foreclosure sale, the property owner amended her Complaint. In the Amended Complaint the property owner continued to ask the Court to rescind the sale, among other relief requested. The lender and foreclosure trustee filed demurrers to the Amended Complaint, arguing that the Amended Complaint failed to state a cause of action upon which the Circuit Court could provide relief. The Circuit Court for the City of Alexandria sustained the demurrers and dismissed the Amended Complaint with prejudice. The property owner appealed to the Supreme Court of Virginia.

On appeal, the Supreme Court of Virginia affirmed the circuit court’s decision. The Court noted that rescinding a foreclosure sale “is a remedy which calls for the highest and most drastic exercise of the power of a court of chancery—to annul and set at naught the solemn contracts of parties.” The Court also stated that “[g]enerally, a court will not rescind a completed foreclosure sale”.

The Court did note that there are “potential exceptions” to the rule that a foreclosure sale cannot be rescinded. These exceptions include: (a) the failure to properly advertise under Everette v. Woodward, 162 Va. 419 (1934), (b) the sale of the property after the secured debt has been satisfied under Smith v. Woodward, 122 Va. 356, (1918), or (c) when the underlying debt was procured through fraud under Wasserman v. Metzger, 105 Va. 744 (1906). The Court also cited collusion between the foreclosure trustee and the purchaser, along with a foreclosure sale price of such gross inadequacy that it shocks the conscience of the court as grounds for rescission. However, it should be noted that absent any evidence of fraud, a foreclosure sale will not be set aside for an inadequate price alone. Squire v. Va. Hous. Dev. Auth., 287 Va. 507, 519, (2014).

In addition to limiting and clarifying the circumstances under which a foreclosed property owner can seek to rescind the foreclosure sale, the Court also commented upon the liability of foreclosure trustees, thus further clarifying a ruling the Court had recently made in Crosby v. ALG Tr., LLC, 296 Va. 561 (2018). In Crosby, the Court ruled that it may be possible for a deed of trust obligor to file a suit against a trustee of a deed of trust for breach of fiduciary duties not specifically identified in the deed of trust. However, in Young-Allen, the Court ruled that as a baseline premise to any claim against a trustee, the property owner must allege that she suffered actual damages and could have reinstated the loan in order to satisfactorily set out a claim against a deed of trust trustee for breach of fiduciary duty.

Finally, the Court noted that filing a memorandum of lis pendens is not sufficient to cause a trustee to forestall a foreclosure. The Court confirmed that a memorandum of lis pendens is merely a notice to the world of the pendency of a judicial proceedings and that, in and of itself, is not sufficient to prevent the trustee from foreclosing.

The Supreme Court of Virginia has, in recent years, addressed a number of issued related to foreclosure. Young-Allen v. Bank of Am., N.A. may prove to be a valuable tool for foreclosure purchasers facing a challenge to the validity of the foreclosure sale.

 

 If you have any questions about foreclosures or foreclosure sales, please contact John Rinaldi.

2020 Virginia Super Lawyers and Rising Stars

Posted on by The Land Lawyers

Virginia Super Lawyers

We are pleased to announce that three lawyers at Walsh, Colucci, Lubeley & Walsh have been named Virginia “Super Lawyers” for 2020. In addition, four of the firm’s lawyers have been named Virginia “Rising Stars” by the lawyer rating service Super Lawyers.

2020 Virginia Super Lawyers

Michael J. Coughlin | Eminent Domain
John H. Foote | Land Use/Zoning, Litigation
Martin D. Walsh | Land Use & Zoning

Virginia Super Lawyers “Rising Stars” recognizes top up-and-coming lawyers who are 40 years old or younger, or who have been practicing 10 or fewer years.

2020 Virginia Rising Stars

Robert D. Brant | Land Use & Zoning
Nicholas V. Cumings | Land Use & Zoning
Antonia Miller | Real Estate Transactions
Andrew A. Painter | Land Use & Zoning

A Thomson Reuters publication, Super Lawyers identifies candidates through independent research and by inviting lawyers in each state to nominate the best attorneys they have observed in action. A lawyer-led research staff evaluates candidates on 12 indicators of peer recognition and professional achievement. Candidates also undergo a peer review by practice area.

County Board Approves Loudoun Mutual Insurance Company’s Rezoning ​

Posted on by Brigitte Flores

In the first landowner-sponsored rezoning in the Village of Waterford, the Loudoun County Board of Supervisors recently approved a rezoning and two special exceptions to allow for Loudoun County’s oldest continually-operated business, Loudoun Mutual Insurance Company, to grow its business at its location in the historic Village of Waterford.

Loudoun Mutual established its business in the Village of Waterford in 1849. In 1949, before there was a Zoning Ordinance in Loudoun County, Loudoun Mutual built its current office building in full conformance with all Loudoun County zoning and land development ordinances and regulations as they existed at that time. Revisions to the County Zoning Map occurred in 1993 that changed the designation on the property to a residential zoning district, which does not allow commercial office uses. Due to this oversight, the property was never granted commercial zoning.

Loudoun Office Managing Shareholder Randy Minchew and fellow land use attorney Sasha Brauer shepherded Loudoun Mutual through the County’s application process to rezone the property to a commercial zoning district and bring the property into full conformance with Loudoun County zoning requirements. Additionally, in order to facilitate the expansion of its current office building, the approval included a special exception for a building greater than 10,000 square feet, and a special exception to reduce the amount of off-street parking.

Loudoun Mutual agreed to install a pedestrian path on the property and to implement tree preservation measures and storm water best management practices. Because the property is located in the Historic District of the Village of Waterford, the expansion of the building will require a certificate of appropriateness from the Historic District Review Committee. Allen Kitselman of Main Street Architecture, PC prepared preliminary architectural renderings that integrate design elements compatible with the existing office building and the character of Waterford.

With these approvals, Loudoun Mutual looks forward to continuing its long history of operating and doing business in Loudoun County and the Village of Waterford. Loudoun Mutual’s President, Chris Shipe, expressed his appreciation to Walsh Colucci, specifically Randy Minchew and Sasha Brauer “for all their help and work guiding this through the process to allow Loudoun Mutual to continue to operate in the place where we were founded.”

 

Image Source: Loudoun Mutual Insurance Company

 

Fairfax County Board Approves Transit Oriented Applications in Tysons West

Posted on by Brigitte Flores

Two companion rezoning applications, both filed by Georgelas LLC as the developer representative, were approved by the Board of Supervisors on May 12th.  Technically separate applications, the West and North Spring Hill Station proposals were master planned and processed together. The West Spring Hill Station is located at the corner of Route 7 and Tyco Road in close proximity to the Spring Hill Metro Station.  Owned by The Templeton Foundation, Inc., West Spring Hill Station is the site of an Audi dealership.  The North Spring Hill Station site has frontage on both Tyco Road and the Dulles Toll Road, and is currently developed with a Tesla dealership, as well as industrial and telecommunication uses.

Rezoned to the Planned Tysons Corner Urban (PTC) District, together the applications are approved for 2.56 million square feet of mixed use development, including up to 1.01 million square feet of office uses and/or up to 1,583 residential units. The applications result in an expansion of the planned Tysons grid of streets, the creation of walkable urban blocks, and the development of eight new buildings and four new public parks.

Parks are always an important element in a Tysons proposal.  West Spring Hill Station provides 1.5 acres of neighborhood parks, including a dog park, open lawns, an art walk, and a sculptural child-centric playground. Two above grade parks are provided on North Spring Hill Station. The Galaxy Sports Deck provides a U-11 sized athletic field, two sport courts, and a playground atop a parking structure – a creative way to provide desired active recreation facilities in an urban setting. In contrast to this highly activated park, a Japanese styled contemplative Zen Garden is also planned.

Elizabeth Baker, Senior Land Use Planner, managed the entitlement process. Master planning and architectural styling by WDG Architects envisions sleek contemporary design and robust street activation. VIKA provided engineering and landscape architecture services.

 

Image Source: WDG Architects

New Senior Living Facility Along Lee Highway Approved

Posted on by The Land Lawyers

ARLnow reported on the recently approved 175-unit assisted living facility, Artis Senior Living, along Lee Highway which was guided through the approval process by land use attorneys Art Walsh and Nick Cumings.

 

[EXCERPT]

New Senior Living Facility Along Lee Highway Approved

The Arlington County Board has voted unanimously to approve a new, 175-unit assisted living facility along Lee Highway. The elder care center will replace a handful of single-family homes on a large parcel of property at the corner of Lee Highway and N. Taylor Street. In addition to more homes for seniors in need of memory care and assisted living services, the project includes environmentally-conscious features and a new 10,000+ square foot public open space. Read more

Alexandria City Council Approves Tall Ship Providence Maritime Center at Waterfront Park

Posted on by Brigitte Flores

On March 14, 2020, the Alexandria City Council approved special use permits submitted by the Tall Ship Providence Foundation which will allow the development of a new pier and maritime center for the Tall Ship Providence. The new developments will be exciting additions to Old Town’s Waterfront Park experience, and will fulfill the vision set forth in the Old Town Waterfront Small Area Plan. The Waterfront Small Area Plan was adopted in February of 2012. The Plan recognizes the important contributions of history and art to Alexandria and seeks to add them to a series of public spaces that comprise the waterfront, making specific mention of The Strand Park located along the waterfront between Prince and Wolfe Street. The Strand is a linear park along the waterfront that residents and staff identified as an opportunity to bring history and art back to the forefront of daily life in Alexandria.

The Plan sets forth various goals to achieve this, including attracting a tall ship to be docked and berthed along a new pier on the waterfront. Tall Ship Providence, an 18th century replica, will achieve this goal and will be docked at a 5,300 square-foot floating pier. The pier will include two 24-by-32-foot cottages to serve as a visitor center, a gift shop, restrooms, and a ticket office; as well as The Tall Ship Maritime Center which will include a theater for historical presentations. The site will finally realize the potential set forth in the plan; providing residents a connection to the City’s history and art scene with various opportunities for education and entertainment.

Land use attorney Cathy Puskar guided the Tall Ship Providence Foundation through the development review process, negotiating with City staff, and conducting significant community outreach.

“We’re very excited to have a home for the Tall Ship Providence. That’s been in the works for quite some time now,” Cathy Puskar told the commission.

All Images Courtesy of HGA

Arlington County Board Approves Redevelopment of Key Bridge Marriott

Posted on by Brigitte Flores

At its March 24 public hearing, the Arlington County Board approved Woodridge Capital’s proposal to renovate the existing hotel and construct two new residential buildings and a public esplanade on the Potomac River at the Key Bridge Marriott property in Arlington. The applications were shepherded through the zoning review and approval process by managing shareholder and land use attorney Nan Walsh who was assisted by land use attorney Nicholas Cumings.

The proposal includes the demolition and renovation of portions of the existing hotel, construction of a new apartment building on the western portion of the property over the existing parking deck, and the construction of two new condominium buildings on the eastern portion of the property.  The hotel will contain approximately 299,953 square feet of development and 445 hotel units.  The apartments will contain approximately 301,617 square feet of development with 300 residential units, and the condominium buildings will contain a total of 334,996 square feet of development with 151 residential units.

Led by Nan Walsh, the hearing, which was conducted virtually due to the recent outbreak of the COVID-19 virus, was brief but positive.  Nan Walsh emphasized to the County Board that the proposed project “celebrated the site’s natural, historic and geographic significance.”  County Board members remarked that the project was an excellent use of the property, a valuable addition to Rosslyn, and delivered important community benefits.  These benefits include providing a publicly accessible esplanade oriented toward the Potomac River as well as an elevated overlook of the Colonial Branch Creek and surrounding forest which will be available to the public and a second park along Fort Myer Drive, which would front a future monument site.

The hearing marked the conclusion of a thorough but positive public review process including support and recommendations for approval from the Disability Advisory Commission, the Environment and Energy Conservation Commission, the Urban Forestry Commission, the Transportation Commission, and the Planning Commission.  The positive reception of the project was a direct result of Woodridge’s decision to assemble a large and talented design team which included three architects for the three housing types and a nationally renowned landscape architecture firm to provide continuity and cohesion at the ground plane.  Throughout the process, the team received numerous compliments on the architecture, innovative approaches to open space, and a commitment to biophilic design.

All Images Courtesy of Maurice Walters Architect, Inc.

Arlington County Board Approves 819 New Units at Crystal Houses

Posted on by Brigitte Flores

At its December 14 public hearing, the Arlington County Board approved Roseland Residential Trust’s proposal for six new residential buildings containing 819 new residential units at the Crystal Houses property in Arlington. The applications were shepherded through the zoning review and approval process through a team effort by managing shareholder and land use attorney Nan Walsh and land use attorney Nicholas Cumings.

Led by Nicholas Cumings, the hearing was positive and complimentary, with County Board members remarking that the project delivered a number of important community benefits, including some much-needed additional housing units in a quality development, and sizable new parks. The proposal includes six new multi-family buildings on the Crystal Houses block, adding additional buildings on the property’s frontage as infill development complementing the existing remaining 828 apartments in Crystal Houses I and II. These new buildings include Crystal House III, an eleven story building with 432 units located on S. Eads Street, Crystal House IV, another eleven story building with 222 units located at the corner of 22nd Street and Eads Street, Crystal House V, a seven story, 81 unit building located on the site of the existing commuter lot just to the south of the property, Crystal House VII, a five story, 63 unit building located on 18th street, and Crystal Houses VII and VIII, which are townhouse-style multifamily units located on Fern Street. The project redevelops the entire frontage of the property, upgrading it to the urban design standards in the Crystal City Sector Plan and transforming it into a modern, walkable, pedestrian, and cyclist oriented community.

In his presentation to the County Board, Nicholas noted that the project both meets and exceeds Sector Plan goals, particularly by creating 54,000 square feet of new public parks, just over twice called for in the Sector Plan, and by installing protected bike lanes along the project’s Eads Street frontage and on the block to the north, providing a contiguous corridor of protected bike lanes to the new Metropolitan Park office development. He noted that the project includes a remarkably unique affordable housing plan; Roseland committed to conveying the Crystal House 5 parcel, as approved, to Arlington County for its development as affordable housing. County Board members complimented the creativity and ingenuity of this plan, and voted unanimously to approve the project.

All Images Courtesy of LESSARD DESIGN INC.

Susan L. Truskey Joins The Firm

Posted on by The Land Lawyers

Susan L. Truskey
View Professional Profile

Susan “Susie” Truskey joins the firm as Associate for the Real Estate Transactions practice group in the Arlington office. Susie most recently worked as an Attorney at Whiteford, Taylor & Preston where her practice focused on the representation of community associations and condominiums throughout Virginia and Washington, D.C. Susie has more than 8 years of experience assisting community association clients with amending governing documents, preparing deeds, easements and license agreements, and other documents relating to land use and real property.​ She has been an active member of the Washington Metropolitan Chapter Community Associations Institute where she was appointed to serve in various leadership positions and was a frequent contributor to the Chapter’s monthly print magazine.

Susie obtained her law degree from The George Washington University Law School and a Bachelor of Business Administration in Finance from James Madison University. Outside of work, she enjoys skiing, playing golf and spending time with her dog, Harper. Welcome, Susie!