Bob Flynn of Signature Title, Inc. provided the following summary of the Court of Appeals decision in Hobby v. State:
The concept of stealing real estate seems far-fetched. One cannot exactly carry it away, at least in the context of asportation (the felonious removal of goods). But a recent case examines this very concept.
In Hobby v. State, (Court of Appeals, January 24, 2014) the court held that the defendant had stolen a home. A homeowner in financial difficulty moved from her house. She listed the property for sale, but before it could be sold, her lender foreclosed. Before the foreclosure, Hobby and his family had moved into the house and were living there. The homeowner had no knowledge of anyone having permission to occupy the property.
The Court broke down the elements of ownership of real estate and concluded that the right to possession of the real estate was taken by Hobby. As a result, Hobby “stole” something of value from the owner—the right to possess the real estate.
What mattered next to the Court was the value of the interest stolen. If it was $1,000 or more, Hobby committed a felony; if less, a misdemeanor. The value also determined the maximum penalty for the offense. The home had a value of over $500,000. However, Hobby didn’t take the home. Hobby took the right to possession for a period of 7 months. The fair market value of the right to possession is a complicated way of saying “fair rental value”. In this case, it was an amount more than $10,000 but less than $100,000.
The case raises interesting questions for practitioners in the foreclosure arena. While the rules have tightened for years, from taking away the remedy of self-help and requiring a writ of possession to be generally issued only AFTER ratification of the sale, Hobby appears to open the door for relief in the criminal arena against those not entitled to possession.