GN Mortgage Corp. v. Fidelity National Title Insurance

In this appeal we consider whether a full credit bid at a nonjudicial foreclosure sale extinguishes all claims of a lender against the participants in a tortious conspiracy to defraud the lender, none of whom is the buyer. We shall conclude it does. The trial court also concluded it did and entered summary judgment for the defendant conspirators. Plaintiff lender contends its claims were not extinguished because defendants were not parties to the original loan transaction and because the damages suffered are measured by out-of-pocket losses, not the extent of impairment of the security. We shall affirm.

I

Because the only issue raised in the trial court was the effect of the full credit bid on plaintiff’s damages, we shall accept as true for purposes of this appeal those allegations of the complaint relating to tortious misconduct.

Defendants and others conspired fraudulently to induce plaintiff to finance a fictitious sale of property at an inflated price. A coconspirator purchased the property for $359,000 on or about May 25, 1990, and thereafter purportedly sold it to Jacinto Rodriguez for $562,000. Rodriguez never agreed to purchase and in fact never did purchase…