Mortgage Insurance Requirements Are Solely for the Benefit of the Lender

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The district court awarded Christopher Bookter damages in a civil action against Jeromy Brooks, the owner of Chicks Pool Hall (Chicks), and a bartender, Wyatt A. Knisley after being injured in a fight at the Pool Hall. To satisfy the judgment, the district court ordered the pool hall seized and sold. Community State Bank (CSB) held a first mortgage on the pool hall and intervened as priority lienholder.

Bookter filed a cross-claim against CSB alleging negligence because it did not enforce the insurance provision in the mortgage contract. The district court granted summary judgment to CSB on the cross-claim, finding that Bookter was not an intended third-party beneficiary of the mortgage contract between CSB and Brooks. In Christopher Bookter v. Wyatt A. Knisley, et al., and Community State Bank, No. 123, 972, Court of Appeals of Kansas (March 4, 2022) the Court of Appeals resolved the issue of standing.

The district court granted CSB’s motion for summary judgment.


In granting summary judgment for CSB, the district court found that Bookter was not an expressly intended third-party beneficiary to the mortgage agreement. The district court found that Bookter may have been an incidental beneficiary of any agreement to maintain insurance, but as an incidental beneficiary Bookter had no right to recovery under Kansas law.


The undisputed evidence before the district court showed that the intent of the insurance provision in the mortgage contract was solely for the benefit of CSB. Thus, the district court did not err in granting summary judgment to CSB.


Bookter, injured and with a $380,000 judgment that he could not collect – even if the property of the pool hall was sold – without first paying the judgment tried to create a right against the bank that held the mortgage. Unfortunately for Bookter he had no standing and his creative efforts to find a way to collect his judgment failed.

© 2022 – Barry Zalma

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