Auction firms beware >> An interesting issue raised and addressed by the Maryland Court of Special Appeals.

BURSON v. SIMARD

JOHN BURSON, ET AL.,v.DAVID SIMARD.

No. 35, September Term, 2011.

Court of Appeals of Maryland.

Bell, C.J., Harrell, Battaglia, Greene, Adkins, Barbera, John C. Eldridge, (Retired, Specially Assigned), JJ.

Opinion by Adkins, J.

In yet another foreclosure case, we address the consequences of a default by the successful bidder at an auction of real property. After the auction sale was ratified, Respondent David Simard defaulted on his contract to purchase the real property in question. Simard admitted liability for the risk and expense of the initial resale, but when the purchaser at the resale defaulted as well, Simard balked at paying the expense and loss incurred at a second resale. Applying Maryland Rule 14-305(g), the Circuit Court for Baltimore County held that Simard was liable for the risk and expense of both resales. On Simard’s appeal from this order, the Court of Special Appeals reversed in a reported opinion, interpreting Rule 14-305(g) to require that a defaulting purchaser be responsible for only one resale. See generally Simard v. Burson, 197 Md.App. 396, 410, 14 A.3d 6 (2011).

The Petitioners, the Substitute Trustees of the property,¹ filed a timely petition forcertiorari which we granted, Burson v. Simard, 420 Md. 81, 21 A.3d 1063 (2011), to answer the following question:

When a foreclosure purchaser defaults, is he or she liable, under Maryland Rule 14-305(g), for the risk and expense of more than one resale?²

We shall affirm the Court of Special Appeals. Absent special circumstances, a defaulting purchaser at a foreclosure sale of property is liable, under Rule 14-305(g), for only the one resale resulting from his or her default.

For the full opinion,  read here. 

Tags: Auction, Limited Costs to one resale, Maryland Foreclosure

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