It was only when the vestry got its first bill for $3,828.54 from FCI Lender Services following its reoccupation of the property on February 17 that it had concrete information that Mrs Bush had offered the commercial space as security for a half-million dollar loan. It appears that the vestry, or counsel, moved quickly to secure the paperwork on this loan from FCI, since I was able to see it in a meeting with the treasurer this past week. There appear to have been several meetings among vestry members, a commercial real estate broker, and counsel regarding this loan and how it affects the parish's title to the property.
I've been told that counsel has filed, or is in the process of filing, a lis pendens notice. This simply notifies anyone attempting to purchase or lease the property that it is the subject of pending litigation, and title to the property is subject to the outcome of the lawsuit.
I suspect that the first development from the vestry's non-payment of the bills from FCI will be an attempt by FCI to foreclose on the property, since FCI advertises itself as a foreclosure service for private lenders. The lis pendens notice would be, I would assume, a first step by counsel to forestall this action. Even if FCI can seize the property (a very big if), they could not easily dispose of it.
I'm told that the commercial broker working with the vestry has told the vestry that it will need to quiet title to the commercial property in order to lease it. This would probably be an action taken against FCI, the Xs (the private couple who made the loan), and presumably the squatter group and the ACA, who claimed that they had title to the property in order to secure the loan. I'm told that counsel is the process of filing this action, but I don't know the precise details. UPDATE: I learn on further research that a lis pendens must be filed at the beginning of an action to quiet title.
I assume this is something the Xs didn't bargain for when Mrs Bush approached them for the half million dollars. They have my sympathy, and I earnestly hope they can secure cost-effective legal representation to get themselves out of this situation.
An additional question that the vestry hasn't brought up, but which occurs to me in the process of researching this and other issues, is Slander of Title. This can involve any recording of a false claim against property, including in a legal action. Whether this would be covered in a quiet title action or could be pursued separately is a question I can't answer. However, it seems to me that damages in any such situation would involve the total value of the parish property (listed in FCI documents in the mid-seven figures) and the value of potential rent from the commercial space during the time the matter was not settled.
The bottom line, as far as I can see, is this: FCI discovers that it must try to foreclose on property to which the lender does not have valid title. It must tell the lenders that they don't have valid title to the property on which they advanced half a million dollars. The lenders will almost certainly need to retain counsel to pursue their legal claims against Mrs Bush, FCI, and the title insurer.
Meanwhile, the vestry files one or more legal actions against FCI, the lenders, Mrs Bush, the ACA, and various et als in a quiet title claim and potentially an action for slander of title. This action, or these actions, will be for amounts in the high seven figures at minimum. FCI, Mrs Bush, the lenders, the ACA, and various et als will need to retain counsel to defend against these actions.
At this point, I count four counsel working on behalf of the St Mary's vestry. Frankly, I would not want to be on the bad side of anyone who hired any of the four. I would be most frightened, though, of Mr Lengyel-Leahu, based on what I observed in last year's trial. (Never go against a lawyer who wears cowboy boots, among other things.)
If nothing else, I strongly suspect that Brian Marsh will be taking a leave of absence as Presiding Bishop of the ACA in the near future. The other parties will need to act to secure their financial interests.
