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Lewis v. Debord

Supreme Court of Arizona

August 25, 2015

CECELIA M. LEWIS AND RANDALL LEWIS, A MARRIED COUPLE, Plaintiffs/Appellants
v.
RAY C. DEBORD AND ANNE NELSON-DEBORD, HUSBAND AND WIFE, Defendants/Appellees

Opinion of the Court of Appeals, Division Two 236 Ariz. 57, 335 P.3d 1136 (App. 2014) . Appeal from the Superior Court in Pima County. The Honorable Gus Aragón, Judge. No. C20125400.

James M. Sakrison (argued), Diana L. Kanon, Slutes, Sakrison & Rogers, P.C., Tucson, Attorneys for Cecelia M. Lewis and Randall Lewis.

Charles W. Wirken, Scott A. Malm (argued), Gust Rosenfeld P.L.C., Phoenix, Attorneys for Ray C. Debord and Anne Nelson-Debord.

JUSTICE BRUTINEL authored the opinion of the Court, in which CHIEF JUSTICE BALES, VICE CHIEF JUSTICE PELANDER, and JUSTICES BERCH and TIMMER joined.

OPINION

Page 315

BRUTINEL, JUSTICE.

[¶1] Arizona's judgment lien statutes, A.R.S. § § 33-961 through 33-968, require the filing of an information statement, but do not specify the consequences of failing to do so. We conclude that failing to attach an information statement to a certified copy of the judgment does not invalidate an otherwise valid lien; rather the judgment lien simply lacks priority against competing creditors who record liens against the property before the information statement is filed.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

[¶2] The underlying facts are not in dispute. In 2003, the Lewises obtained a default money judgment against Karen MacKean and Fred Foust (the " MacKeans" ), a married couple. In 2006, the Lewises recorded their judgment in Pima County attempting to create a lien on the MacKeans' real property. They filed a renewal affidavit in 2008. Neither the initial recording nor the renewal was accompanied by a separate information statement as required by A.R.S. § § 33-961(C) and 33-967(A).[1]

[¶3] In March 2008, Karen MacKean purchased the property and almost immediately transferred it to Sonomex, LLC. Foust was Sonomex's statutory agent. In July 2012, the Debords, the defendants/appellees in this case, bought the property from Sonomex. A month later, the Lewises sought to foreclose their lien against the property and named the Debords, Sonomex, and MacKean as defendants. The Debords moved for summary judgment, arguing that the Lewises could not execute against the property because their failure to file an information statement rendered their judgment lien invalid. The trial court agreed and entered summary judgment in favor of the Debords.

[¶4] The court of appeals affirmed, but on different grounds. Lewis v. Debord, 236 Ariz. 57, 335 P.3d 1136 (App. 2014). The court of appeals reasoned that recording a judgment without an information statement does not affect the resulting lien's validity, but the absence of an information statement affects the lien's priority among competing creditors and fee title holders like the Debords. Id. at 61 ¶ 13, 62 ¶ ¶ 15-16, 335 P.3d at 1140-41. The court concluded that the legislature intended, through the information statement requirement, to " carve[] out a narrow exception to the general principle that a subsequent purchaser who has notice of a judgment lien takes the property subject to it." Id. at 63 ¶ 18, 335 P.3d at 1142. The court thus held that the Lewises' lien lacked priority against the Debords' subsequent fee interest and the Lewises could not execute

Page 316

against the property. Id. at 63 ¶ ¶ 17-19, 335 P.3d at 1142.

[¶5] We granted review of the Lewises' petition and the Debords' cross-petition because they present recurring legal issues of statewide importance regarding the judgment lien statutes. We have jurisdiction under Article 6, Section 5(3) of ...


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