In re Foreclosure 1107 Snowberry, 474 P.3d 481

Background

In 2006 Owner received a $500,000 loan memorialized by a promissory Note listing Instant Mortgage Lending, Inc. (IML) as lender; a Trust Deed purporting to secure the Note was recorded a few days later.
The Trust Deed’s first paragraph names Instant Funding, LLC as “Beneficiary,” but paragraph 16 defines “Beneficiary” as the “owner and holder” of the Note; the Note itself lists IML (and later various amended holder names) and never lists Instant Funding.
Two recorded correction notices followed in 2006: a May notice again referencing Instant Funding and an August notice (executed only by the trustee) correcting the beneficiary to Instant Mortgage Lending Corp.; Ocean 18’s president later swore Instant Funding was listed by mistake.
IML purportedly assigned its interest to Ocean 18 (and Amir Hechter) in 2012–2013. A 2018 foreclosure produced over $273,000 in excess proceeds; Ocean 18 claimed priority as successor to IML, while Dowd (judgment creditor) and Overage disputed that claim.
The district court ruled, on briefing only, that Instant Funding (the name on page one) was the Trust Deed beneficiary, concluded IML had no interest to convey, and awarded the funds to Dowd and Overage.
On appeal the court of appeals held the Trust Deed ambiguous, ruled as a matter of law that Instant Funding was not the intended beneficiary and that IML was the intended beneficiary at execution, but remanded because questions remained about later Note amendments and the validity of the 2012–2013 transfers to Ocean 18.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the Trust Deed unambiguously named Instant Funding as beneficiary	Ocean 18: the apparent naming was a minor scrivener error; the deed should be construed to give effect to parties’ intent (IML)	Dowd/Overage: first page controls; Instant Funding is beneficiary and no assignment from it exists	Deed is facially ambiguous; district court erred to treat first page as dispositive; Instant Funding was not intended beneficiary (reversed)
Whether extrinsic evidence shows IML was intended beneficiary at execution	Ocean 18: course of dealing (IML made the loan) and sworn declaration establish IML was intended beneficiary	Dowd/Overage: correction documents unreliable/no instrument signed by Instant Funding relinquishing interest	Court: extrinsic evidence (declaration, course of dealing, August correction) is one-sided enough to conclude as a matter of law that IML was intended beneficiary at execution
Whether IML remained beneficiary after Note amendments and whether Ocean 18 validly succeeded to that interest	Ocean 18: asserts valid succession to IML’s interest (entitled to proceeds)	Dowd/Overage: chain of title and Note amendments raise material disputes about who held the Note and validity of assignments	Court: unresolved factual issues—cannot determine as matter of law whether IML remained holder or whether the 2012–2013 conveyances were valid; remand for further proceedings
Whether appellate review and summary judgment posture were proper given absence of evidentiary hearing/discovery	Ocean 18: issues were preserved; summary-judgment review appropriate	Dowd/Overage: argued lack of preservation and that district court should have required evidentiary proof	Court: issues preserved; reviewed correctness under summary-judgment standard and found district court improperly resolved ambiguous facts without sufficient record

Key Cases Cited

Daines v. Vincent, 190 P.3d 1269 (Utah 2008) (facial ambiguity permits parol evidence to determine parties’ intent)
Mind & Motion Utah Invs., LLC v. Celtic Bank Corp., 367 P.3d 994 (Utah 2016) (contract interpretation aims to ascertain parties’ intent; ambiguity test)
Café Rio, Inc. v. Larkin-Gifford-Overton, LLC, 207 P.3d 1235 (Utah 2009) (interpret instrument as a whole and harmonize provisions)
Keith v. Mountain Resorts Dev. LLC, 337 P.3d 213 (Utah 2014) (deeds construed like other written instruments under ordinary contract rules)
R & R Energies v. Mother Earth Indus., 936 P.2d 1068 (Utah Ct. App. 1997) (ambiguity exists only if competing interpretations are tenable)
Cross v. Olsen, 303 P.3d 1030 (Utah Ct. App. 2013) (summary judgment can resolve factual issues when parol evidence is one-sided)