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Satisfaction of Mortgage Eliminates Right of Mortgagee to Recover from \\nHomeowners Policy\\n\\nIn Thomas P. Williams, Sr. v. Nationwide Insurance a/k/a Nationwide \\nMutual Insurance Company, Civil Action No. 22-1090, United States \\nDistrict Court, E.D. Pennsylvania (March 24, 2023) Nationwide denied the\\n claim of its insured because they failed to comply with the Policy\'s \\npost-loss duties by failing to appear for scheduled examinations, not \\nproducing requested documents, making material misrepresentations to \\nNationwide and because Nationwide\'s investigation of the fire revealed \\nthat it was \\u201cintentionally set.\\u201d\\n\\nThe homeowners sold the fire-damaged property to the plaintiff. The \\nmoney from the sale was used to satisfy the entirety of the homeowners\' \\noutstanding mortgage with a bank.\\n\\nThe plaintiff requested that the insurer reimburse him for the amount he\\n claims he paid toward satisfying the homeowners\' mortgage. He based his\\n request on a standard mortgage clause in the homeowners\' insurance \\npolicy, which stated that a denial of the homeowners\' claim would not \\npreclude payment to a valid claim of the mortgagee.\\n\\nThe insurer refused to pay the plaintiff\'s claim and the plaintiff sued.\\n\\nPROCEDURAL HISTORY\\n\\nThe plaintiff Thomas P. Williams alleged that he had purchased a \\nfire-damaged property and paid off the mortgage encumbering the \\nproperty.\\n\\nFACTUAL BACKGROUND\\n\\nThe Ruchs owned property located in Albrightsville, PA (\\u201cthe Property\\u201d).\\n They had insured the Property for property damage under a policy with \\nNationwide (\\u201cthe Policy\\u201d) and had a mortgage on the Property with PNC \\nBank NA (\\u201cPNC\\u201d).\\n\\nA fire caused damage to the Property. The Ruchs submitted a claim to \\nNationwide under the Policy, and Nationwide eventually determined that \\nthe amount of the adjusted claim was $103,000.00. However, Nationwide \\nlater denied the claim because of breach of condition and fraud.\\n\\nAt the time of the sale, the Ruchs owed $135,490.13 on the mortgage to \\nPNC and used the funds from the sale to satisfy the outstanding balance.\\n At that time, Nationwide had not made any payment to PNC pursuant to \\nthe mortgage clause. After receiving the payment, PNC filed a \\nSatisfaction of Mortgage with the Carbon County Recorder of Deeds.\\n\\nDISCUSSION\\n\\nWilliams argued that because his funds paid to the Rauch\'s satisfied the\\n mortgage on the Property and because Nationwide would have had to pay \\nPNC if it fulfilled the policy conditions, he stepped into the shoes of \\nPNC. \\n\\nThere was no evidence demonstrating Williams assumed any legal rights \\nunder the mortgage. While Williams novel argument demonstrates a logical\\n creativity, he cites no case law, and the court found none to support \\nhis contention that a purchaser of a property steps into the shoes of \\nthe mortgagee when the funds from the purchase are used to satisfy an \\noutstanding mortgage.\\n\\nDuty to Pay Pursuant to the Mortgage Clause