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Continued: Whistleblower: House buyer discovers he's a squatter

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  • Last update: August 12, 2012 - 6:07 PM

Marc Barone thought he'd gotten a great deal when he bought a double-wide manufactured home and 10 acres of land south of Duluth in 2005. The trouble was, the house and the land weren't in the same place.

The disabled former furniture mover paid $62,900 cash and retired to the comfortable, three-year-old home in the woods near Kerrick, Minn.

What Barone, 57, didn't know at the time was that the house he was sold was located entirely on land owned by his neighbor. The land Barone bought was actually next door, a tamarack swamp too wet to build on.

Despite the land changing hands several times, no surveys were done that could have detected the error. Seven years later, nobody knows how to fix the situation.

"It's so convoluted it defies common sense," said Rick Jurek, who inherited the land under Barone's mobile home after his father died in 2008.

"[Barone] can't sell the house because he doesn't own the land. Dad couldn't sell the land because there's a house on it he didn't own," Jurek said.

Jurek's father, John, bought the property years earlier as an investment, but rarely visited it, his son said. His father's first inkling something was amiss was when his property taxes spiked shortly after Barone moved in.

An assessor told John Jurek there was a house on his property. John Jurek called Barone to say his house was in the wrong place. Barone was understandably skeptical. "I said, 'Well, you're just some guy calling me up telling me this. I need some proof."

In the next few months he got all the proof he could want.

When it all went . . . west

The original mistake that led to the misplaced double-wide dates back a decade. According to county records, Nadine Behrman bought the 10 acres in April 2002.

By 2003, Behrman was living in a double-wide that had shown up on the adjacent Jurek property. It had septic, water and electrical service.

To this day the land Behrman bought has no street address, yet a public records search shows that in 2002 and 2003 Behrman had a mailing address of 50037 Lower Estates Drive: the Jurek land. Behrman could not be reached for comment.

Behrman's bank foreclosed on her in about 2004 and Edina Realty listed the property for sale -- with the double-wide included -- on behalf of Freddie Mac, the federally controlled mortgage lender.

Barone saw the listing, and a real estate agent showed him around the property -- Jurek's property, Barone said.

The purchase agreement listed the Jurek property's address, but provided a legal description of the adjacent 10 acres. It also promised window treatments, a dishwasher and other amenities the swamp could not claim.

A representative of Edina Realty said the company "didn't know anything" about any irregularities. "If we'd had any indication there was any problem . . . we would have stopped, we would have got more information before the transaction went forward," said Jim Eisler, a managing broker in Edina Realty's Brainerd and Crosslake office. "I've never seen this before in 37 years."

Experts agree that if either Freddie Mac or Barone had paid for a survey, the problem would have been discovered before their deal went through.

"The surveyor would have found you can't put that mobile home where you want to because you don't own that land," said Troy Stewart, a Pine County deputy assessor. "That probably would have been the wise thing to do, but obviously that didn't happen."

Fixes suggested, but nixed

Barone got the bad news in a phone call from his neighbor.

Larry Veldhouse, then a Pine County assessor, confirmed John Jurek was telling the truth. Barone's title company sent out someone with a GPS to draw up an approximate plat that showed the house recessed deep into Jurek territory.

John Jurek told Barone to move the house or buy the land it was sitting on. Barone balked. After all, he had already paid for what he thought was his land.

Barone suggested they sell their property in one transaction to a third party and divide up the proceeds. John Jurek wasn't interested.

View from the assessor's office

In 2006, Pine County began imposing personal property taxes on Barone for the mobile home and taxing Jurek for his five acres and the improvements made by Behrman to the land: the well, septic and electrical service.

"Typically when you have a well on your property, it's your property, but being this is kind of a mess up there, Jureks have no records showing that they paid to have a well put in," Stewart said.

Blame proves elusive

Both Barone and Rick Jurek believe somebody should take the rap for this "mess."

"The ideal situation would be that someone else either reimburse Marc or pay us for the land" Rick Jurek said.

But that "someone else" has proven elusive.

Despite a document signed by Freddie Mac acknowledging transfer of "land and buildings" to Barone, his title insurance policy with Attorneys' Title Insurance Fund Inc., in Florida, only lists the land.

Attorneys' Title invoked a broadly worded clause that claimed no responsibility for "matter[s] which would be disclosed by an accurate survey."

Larry Wertheim, a real estate lawyer for Kennedy & Graven in Minneapolis, questions whether Freddie Mac had the right to sell the house and improvements. The mortgage was likely "on the property of the adjacent owner who inadvertently [put] a house on the wrong piece of property . . . property that [s]he didn't have any interest in," he said.

"You can give a deed to someone but if it doesn't convey good title ... I can give you a deed to the Brooklyn Bridge but it won't do you much good," Wertheim said.

Edina Realty points the finger at Freddie Mac. "If Freddie Mac stated something incorrectly, the liability falls on the seller," Eisler said.

A spokesman for Freddie Mac did not return phone calls for comment.

To hold Freddie Mac liable, Barone would need to prove that the seller committed fraud, but "it sounds like the seller may not have known either," Wertheim said.

"I could get dirty and evict [Barone] and not on my dime either, but I don't want to do that," Rick Jurek said. "We've been pretty friendly throughout this whole thing."

If nothing is done, the issue may settle itself. The doctrine of adverse possession gives Barone a possible claim to Jurek's land after openly occupying it for 15 years, Wertheim said. He's got eight years to go.

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