Thursday, January 7, 2010

Evans update: Britton & Koontz seeks payment of claim for $904,000, MVT responds with demand for arbitration

For a collection of all posts on Evans case, see sidebar on right side of page. See bottom of posts for a synopsis of the Evans case.

The Evans case continues to heat up as Britton & Koontz Bank (Natchez) filed a lawsuit on December 22, 2009 against Mississippi Valley Title Insurance Company seeking to enforce a title insurance policy it purchased from Mississippi Valley Title and recover related costs. Britton & Koontz bought the policy for a loan it issued to Chris Evans. Mississippi Valley Title responded with a Motion to Compel Arbitration, citing an arbitration clause in the insurance policy. Copy of complaint

B&K granted a mortgage for $904,000 to Brashear Heath, LLC, a company owned by Chris Eavns on May 2, 2008. Deed of Trust. The bank argues the policy covered fraud and that it filed the claim pursuant to the notice provisions in the policy. Apparently Brashear Heath never owned the property that was the subject of the loan even though (and this is a familiar story) Charles Evans certified Brashear Heath ownded the land. The Natchez bank first filed a claim with the insurance company, sent a demand letter to Mississippi Valley Title seeking payment of its claim after the thirty day payment period passed, (Copy of letter is on page 16 of complaint.), and then filed suit in December after Mississippi Valley Title did not pay the claim.

Mississippi Valley Title answered with a Motion to Compel Arbitration on Janurary 4, 2010. The defendant cited a clause in the thirteenth paragraph of the title insurance policy. The clause cited states: "Either the company or the insured may demand that the claim or controversy shall be submitted to arbitration..." (See page 10 of the complaint for a copy of the policy.). Motion to Compel Arbitration, Memo in support of Motion to Compel Arbitration.

This lawsuit is the second case where Mississippi Valley Title and a bank are fighting over a title insurance policy in the Evans case. JJ reported last month on a dispute between the insurance company and the Bank of Forest over a mortgage issued on an Evans-owned property. Mississippi Valley Title also sought (and failed) to keep its lawsuit against Charles Evans in chancery court and has already opposed the trustee and a few banks on several motions in bankruptcy court. It is reasonable to assume a substantial percentage of the title insurance policies issued by MVT contain arbitration clauses. Thus it must be asked if Mississippi Valley Title is going to force banks to sue MVT for payment of claims so it can then use such an arbitration clause to its advantage. As arbitration is costly and strings out the process even further, is Mississippi Valley Title's motion merely an attempt to delay or force Britton & Koontz to settle a case for a lower amount and thus mitigate its damages?

Stay tuned.

Synopsis of Evans case (This feature will be included with future posts on Evans case): Charles Evans, Jr. was an attorney approved by Mississippi Valley Title Insurance Company to provide title certificates to MVT and lenders showing a borrower had clear title to property. MVT filed a lawsuit in September accusing his brother of using over 30 LLC's to obtain fraudulent loans from over 30 banks in Mississippi. Chris Evans would allegedly use one company to purchase a large tract of prime commercial real estate in Madison and Desoto Counties. Another company owned by Evans would obtain a commercial real estate mortgage on a smaller section of the tract yet that borrowing company never obtained a deed showing ownership of the land from the other company. Thus the smaller tract was actually non-existed as the larger tract was never actually subdivided. Charles would allegedly provide a title certificate however showing the borrowing company owned the land even though it didn't. Over 80 loans for nearly $50 million were issued by Mississippi banks to companies owned by Chris Evans for lands those companies either did not own. MVT has testified federal authorities are currently investigating the case. Chris Evans filed Chapter 7 bankruptcy on October 26, which stopped the Mississippi Valley Title's lawsuit against him as federal bankruptcy law stays most state civil court proceedings once a bankruptcy petition is filed. Mississippi Valley Title testified 65 title insurance claims for approximately $41 million have been filed by banks affected by the Evans case.

11 comments:

Anonymous said...

Arbitration is actually cheaper and quicker than litigation.

Kingfish said...

Depends. Lawyer today told me it can be shorter or longer and being cheaper is not a sure thing. Arbitrators are not cheap either and if I'm not mistaken, the parties have to split the costs of such arbitration. I have a couple of calls out to some lawyers I know so I can get more information on this issue. The question is is this a delaying tactic by MVT and are they going to start doing this more as I'm told they have not paid any claims yet nor produced any documentation showing such claims.

If MVT pays a claim, then the creditor in bankruptcy court somewhat disappears. Haven't seen any disappear, have we?

1962guy said...

Does anyone know if either of the Evans boys are due to make any personal appearances during this big "party"???????

or are they MIA ?????

Anonymous said...

check out the components of the arbitration panel. therein lies the rub

Kingfish said...

How can you tell who is on the panel? Are appointments announced?

saintpeter said...

Where are the Evans from? I seem to remember a Charles Evans from my Murrah days. Could this be the same guy? Hope not. Seemed like such a nice guy back then.

Kingfish said...

Same ones, I think. Both grew up and went to school here.

Anonymous said...

Sidebar to this. A former employee of the phonebook called on me this week selling ads for some new coupon book in town.
It was hilarious listening to her side of this story. I didn't let on that I was following it on here and she just spilled everything.
She told me that for the last 6 months she was employed, her income was paid by a credit card of Chris's. I asked her if that raised a red flag. She responded yes but she needed a job.
Said all the books are printed and sitting in storage. advertisers calling her daily for an update, etc.

Anonymous said...

Evans brothers to present themselves behind closed doors Jan 14 to account for 83 million dollars. They r both n Jackson. How is it none of u see them?

Kingfish said...

I've seen Chris Evans and supposedly Charles is still in town.

Anonymous said...

He is n town. He has a rental car from Pearl which is paid for by credit card. He shops at Talbots n dashes around Dinsmore n his jogging pants. Through the woods n all. He is so slick he'll probably just walk away from all of this.



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