THE BANK OF NEW YORK MELLON TRUST COMPANY, NATIONAL ASSOCIATION, fka the Bank of New York Trust Company, N.A., successor to JPMorgan Chase Bank NA, as Trustee for RAMP 2006, Plaintiff/Appellee,
ARIZONA HOA ACCEPTANCE LLC, Defendant/Appellant
from the Superior Court in Maricopa County. No.
CV2013-008807. The Honorable Benjamin E. Vatz, Commissioner
Offices of David L. Knapper, Phoenix, By David L. Knapper,
Co-Counsel for Defendant/Appellant.
Hill PLC, Scottsdale, By Mark S. Sifferman, Co-Counsel for
Finlay & Zak LLP, Scottsdale, By Kim R. Lepore, Jamin S.
Neil, Counsel for Plaintiff/Appellee.
Patricia K. Norris delivered the opinion of the Court, in
which Presiding Judge Jon W. Thompson and Judge Maurice
Patricia K. Norris, Judge:
The issue in this appeal is whether Arizona's redemption
statutes grant the holder of a homeowners' association
assessment lien the right to redeem residential real property
following the mortgage foreclosure sale of that property. We
hold they do.
AND PROCEDURAL BACKGROUND
In 2005, a borrower executed a promissory note secured by a
deed of trust (" deed of trust lien" ) on
residential real property in Maricopa County, Arizona. The
real property was subject to a previously recorded
Declaration of Covenants, Conditions and Restrictions. The
Declaration created a homeowners association, Vista View
Homeowners Association a/k/a Val Vista Views Homeowners
Association (" Association" ), required the owners
of property subject to the Declaration to pay certain
assessments " fixed" by the Association, and, as
authorized by Arizona Revised Statutes (" A.R.S." )
section 33-1807 (Supp. 2015), declared
the assessments to be " a continuing lien upon [each
parcel of property] against which each such Assessment is
made" (" assessment lien" ).
After the borrower defaulted on his obligations under the
note and deed of trust, plaintiff/appellee, The Bank of New
York Mellon Trust Company, National Association, sued the
borrower for breach of contract and to foreclose the deed of
trust lien and the borrower's interest in the property.
The Bank also sued the Association and alleged that any
interest it claimed in the property was subordinate and
inferior to the deed of trust lien. Subsequently, the
Association stipulated that any lien it held on the property
was junior to the Bank's deed of trust lien.
The Bank obtained a default judgment against the borrower in
the principal sum of $199,642.52. The judgment foreclosed the
borrower's interest in the property, foreclosed the
Bank's deed of trust lien, declared the Bank's deed
of trust lien valid and superior to all other liens, and
directed the Maricopa County Sheriff to sell the property
pursuant to a writ of special execution (" Sheriff's
Sale" ). The judgment also authorized the Bank to
purchase the property at the Sheriff's Sale by applying
" all of [sic] any portion of the indebtedness
evidenced" by the judgment towards the purchase price
(" credit bid" ).
The Bank purchased the property at the Sheriff's Sale for
a $22,000 credit bid. Approximately one month later, the
Association assigned all rights it had to enforce a $2,000
assessment lien it held on the property to
defendant/appellant Arizona HOA Acceptance, LLC ("
Arizona HOA" ). Simultaneously, Arizona HOA recorded a
" Notice of Intent to Redeem." The notice stated,
inter alia, that Arizona HOA intended to redeem the
property by paying the amount of the credit bid, $22,000,
plus any additional amounts required to effectuate the
redemption as required by statute. See generally
A.R.S. § ...