Eric P. Feichthaler

Dear Mr. Feichthaler:

I purchased a lot from a German family last year, and used a local title company. They issued me an owner’s policy for the sales price we paid, and there were no exceptions on the policy, other than the standard plat exceptions for Cape Coral.

Last week, I received a letter from the owners in Germany, saying they didn’t sell us the property! It said they didn’t even list the property, and that they want the property back. They are threatening to sue us, what should we do?

— Jack and Gloria H.

Dear Jack and Gloria:

First, I am so sorry to hear of this situation, and you should know you are not alone. As fraudsters become more bold and technology advanced, the chances for fraud are becoming greater and greater. We have had fraudulent sellers attempt to sell property through our firm on a weekly basis, and we have rigorous procedures to confirm the seller is legitimate. In your case, it is likely the Realtor listed the property without meeting the owners, and the title company likely didn’t meet them, either. They likely provided fake passports and used a notary that was in on the fraud. The result to the title company, without further research, is that they had the real seller.

Which brings us to today. Assuming the people that contacted you are the actual owners (which you shouldn’t trust initially, either), you will want to tell them you purchased the property with title insurance, and provide them with that policy along with the title company’s contact information. I frequently speak with clients about the importance of title insurance. If you didn’t have it, you could be on the hook to pay for the lot again, or to provide it back to the rightful owners with no compensation. With the title policy, it insures against title defects. A fraudulent deed from the fake sellers to you would qualify as a title defect for sure. The procedure would be for the owners to make a claim against the underwriter of a title insurance policy, and the insurer is responsible for providing compensation to the owner, or getting the property back. This could result in you accepting your money back if you chose to. Every situation like this is unique, so it may be a good idea to discuss this with an attorney to understand your rights.

I have noted before the free service offered by our Lee County Clerk of Courts — “Fraud Alert.” When you sign up for this service, the county will send an email anytime a deed, mortgage,or other document is recorded impacting your property. Although this doesn’t provide a “lock” on title (which isn’t possible, anyway), it provides immediate notice to the rightful owners of the transfer, so they can act quickly to protect their property and rights.

Eric P. Feichthaler has lived in Cape Coral for over 35 years and graduated from Mariner High School in Cape Coral. After completing law school at Georgetown University in Washington, D.C., he returned to Southwest Florida to practice law and raise a family. He served as mayor of Cape Coral from 2005-2008, and continues his service to the community through the Cape Coral Caring Center, Cape Coral Museum of History, and Cape Coral Kiwanis. He has been married to his wife, Mary, for over 20 years, and they have four children together. He earned his board certification in Real Estate Law from the Florida Bar. He is AV Preeminent rated by Martindale-Hubbell for professional ethics and legal ability, and is a Supreme Court Certified Circuit Civil Mediator. He can be reached at eric@capecoralattorney.com, or 239-542-4733.

This article is general in nature and not intended as legal advice to anyone. Individuals should seek legal counsel before acting on any matter of legal rights and obligations.