Appellate case law update

Appellants-Mechanic’s Lienholders, Harold McComb & Son, Inc. (McComb) and American Renovations of Indiana, Inc. (ARI) (collectively, Lienholders), appeal the trial court’s grant of Appellee-Mortgagee’s, JPMorgan Chase Bank, NA (Chase), motion for partial summary judgment in these consolidated actions against Indian Village Apartments, LLC (Indian Village) for foreclosure of the Lienholders’ mechanic’s liens and Chase’s mortgage. The Lienholders present two issues for our review, which we restate as: (1) Whether the Lienholders have standing to challenge Chase’s foreclosure action against Indian Village; and (2) Whether the trial court properly prioritized the liens of the parties.

Conclusion (slip op. at 17): We conclude that the trial court did not err in finding that McComb lacks standing to challenge Chase’s mortgage foreclosure action or in prioritizing the respective liens. Therefore, we affirm the trial court’s grant of Chase’s motion for partial summary judgment.

Key Analysis (slip op. at 7, 14-15): Even if we assume that McComb is correct that Chase breached the Construction Loan Agreement and the Note and was the first to do so, McComb has no legal standing to complain. Only the parties to a contract, those in privity with the parties, and intended third-party beneficiaries under the contract may seek to enforce the contract . . . [T]here is no dispute that Chase’s mortgages were recorded before the Lienholders’ mechanic’s liens or that the property in question is commercial in nature. The trial court was correct that Indiana Code subsection 32-28-3-5(d) controls [over 32-28-3-2] and that Chase’s mortgages have priority over the mechanic’s liens.