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Rule 71: Foreclosure and Partition

71 (a). Proceedings, Reference. Actions to foreclose liens or obtain partition of real property shall be tried by the court, and shall ordinarily be referred to a master pursuant to Rule 53. In foreclosure actions the judge or master shall compute the amounts due the plaintiff and any other claimants, which amounts when determined shall be the total debt due to each. The total debt shall as a minimum set forth clearly the principal due upon default, the rate of interest and interest from date of default to hearing date, any other relevant interest charged, any amounts due or to be credited on escrow items, the taxable costs of collection prior to hearing, and the amount of allowable attorneys fees due and anticipated through conclusion of the action. Also included shall be the rate of interest to accrue until the date of the judgment and the post judgment interest rate. The judge or master may also establish the priority and compute the amounts due of any other liens when a determination of lien priorities appears necessary or desirable prior to a foreclosure sale. Any party who has appeared in the action may present proof that the debt may be satisfied by selling the property in parcels, rather than selling the whole to satisfy the claims. Only parties who have appeared and filed pleadings in the action shall be entitled to the usual notice of hearings and other proceedings unless the pleadings state an unliquidated claim. In all cases proof shall be made of the facts and circumstances alleged in the pleadings and evidence given as to any payments which have been made or credits due. Prior to the filing of the master's report or final order of judgment, the judge or master shall assure that the plaintiff and all other claimants have complied with the statutes pertaining to the filing of notices of lis pendens. In all actions a record of hearings shall be made and preserved in the case file in the office of the clerk of court. (Amended effective May 1, 1986)

71(b). Judgment and Sale on Foreclosure. The judgment shall direct that the mortgaged premises (or part thereof as required to satisfy the claims established) be sold by or under direction of the master or, in counties where there is no master, other appropriate court officer. The judgment shall also contain a good and sufficient legal description of the property being sold, a provision for the necessary legal advertisement, the time and location of the sale, and notice of any senior liens, taxes, or other rights to which the property to be sold is subject. The judgment shall also specify the amount of good faith deposit necessary at the time of the sale, and the date that compliance must be made with the bid. The plaintiff or any other party may be a purchaser on such sale. Unless the pleadings state that no personal or deficiency judgment is demanded or any right to such judgment is expressly waived in writing, the bidding shall not be closed upon the day of sale but shall remain open until the thirtieth day after such sale exclusive of the day of the sale. The manner and conduct of the bidding when a deficiency has been demanded shall be as required by law. (Amended effective May 1, 1986)

The master or other court officer making the sale shall execute a deed to the purchaser. Out of the proceeds of the sale he shall pay the costs of the sale, any amounts ordered to be paid by the judgment, then to the parties or their attorneys of record the amounts of their total claims and interest or so much of the purchase money as will pay the same. Notwithstanding the fact that the foreclosure action may have been referred to the master for final judgment, the master or other officer conducting the sale shall file a report with the court as to the sale and the receipts and disbursements made. Any surplus moneys arising from the sale shall be held by the officer making the sale and shall be paid pursuant to Rule 71(c).

71(c). Disposition of Surplus. In the event of a surplus fund resulting from the sale, the master or other officer conducting the sale shall at the time he makes his report to the court on the sale and disbursements, cause to be furnished to all parties appearing in the action a notice advising of the surplus fund. Unless otherwise provided therein, the original order of reference in a foreclosure action shall be considered to extend to the disposition of the surplus fund. Any party to the action, or any person who had a lien on the mortgaged premises at the time of the sale, upon filing with the master or other officer conducting the sale a claim of entitlement to the surplus fund, may have a hearing to determine such entitlement. All such claims must be verified or supported by affidavit and must be filed with the master or other officer conducting the sale within forty-five (45) days from the date of the filing of the statement of receipts and disbursements provided in Rule 71(b). If a claim is not filed within the said forty-five (45) day period, the same shall be considered abandoned and waived as to such surplus. The claim must contain the name of the claimant, the nature of the claim, the date the claim arose, and a calculation of the amount claimed. At the expiration of the claim filing period, the master or other officer conducting the sale shall set a hearing to accept proof of the claims filed. Only those who have filed a timely claim are entitled to notice of the hearing. In the event no claims are filed against the surplus funds, the fund shall be paid over to the mortgagor or lienor entitled to the fund. If such mortgagor or lienor cannot be readily determined or located, the fund shall be disposed of as an abandoned fund in the manner provided by law. When the proceedings have been completed, a report of the same shall be made to the court and filed in the action. (Amended effective May 1, 1986)

71(d)(1). Parties to Partition Actions. In addition to the requirements of these rules for the joinder in an action of all parties in interest, pursuant to Rule 17(f) no partition of real property of a deceased person shall be had unless the legal representative or representatives of such deceased person be made parties to the action and it be made to appear to the court that the debts of such deceased person are fully paid or that the personal estate in the hands of the personal representative or representatives is sufficient for the payment of the debts of such deceased person. If the partition action involves real property of a deceased person whose estate has not been administered or is not being administered at the time of the bringing of the action, then all known encumbrancers of the estate. of the deceased person shall be made parties to the action and no decree in partition shall be entered unless due provision is made for the payment of the debts found due such encumbrancers. In all actions for partition, all heirs at law or devisees of the deceased person shall likewise be made parties.

71(d)(2). Partitioning Several Tracts. Where several tracts or parcels of land lying in this State are owned by the same persons as tenants in common, no separate action shall be brought for partition of a part thereof without the consent of all the cotenants. If such action be brought without such consent, the share or shares of the plaintiff(s) may be charged with all of the costs of the action.

71(d)(3). Attorneys Fees and Costs. Attorneys fees and costs may be awarded the attorney for any party(s) from any common fund generated by the partition to the extent that attorney's efforts benefited all parties; otherwise, his fee shall be paid by the party(s) he represents or from the party(s) share(s) only. The court may order the payment of costs from the proceeds of sale of the common property or may equitably assess the costs against shares of the parties.

71(d)(4). Lien Against Undivided Interest of Cotenants. A lien against the undivided interest of a tenant in common is subordinate to the right of cotenants to compel partition; and when partition is made, the lien is transferred to the portion assigned to the debtor in severally, or to his share of proceeds from the sale of the property.

71(e). Actions When Title is at Issue. In foreclosure or partition actions when title to real property is at issue the court or master to whom the action is referred shall take testimony and receive evidence as to the title and interest in the premises of the several parties. In all such actions the judge or master shall ascertain the rights and interests of the several parties and set forth in the report or order of judgment the conveyances or probate estates, if any, through which the rights or interest were acquired. In all such actions a transcript of record shall be made and preserved in the case file in the office of the clerk of court.