Bank of New York v. Nally

BOEHM, Justice.

We hold that a mortgage recorded before a deed to the mortgagor is recorded but after the deed is dated and delivered is within the mortgagor's chain of title as of the time of recording. We also hold that equitable subrogation is an appropriate remedy and available to a subsequent mortgagee who pays off the senior mortgage in total.

Factual and Procedural Background

This is a dispute between the Bank of New York and Tod D. and Pamela E. Owens, husband and wife, over the priority of their mortgages on a residence in Hamilton County. In capsule form, Mr. and Mrs. Owens sold the…