Villa De Jardines Ass'n v. Flagstar Bank, FSB
227 Ariz. 91
| Ariz. Ct. App. | 2011Background
- VJA sought judicial foreclosure of liens against nineteen Pinal County parcels based on an assessment lien priority under A.R.S. § 33-1807.
- Banks (Flagstar and Freddie Mac) answered and moved for summary judgment; Desert Hills Bank and Countrywide defaulted.
- The trial court granted summary judgment in favor of Banks, ruling assessment liens are superior except to a recorded first mortgage/first deed of trust.
- VJA challenged the priority interpretation, the breadth of the judgment, and sought Rule 11 sanctions and post-judgment relief.
- VJA moved for new trial and reconsideration; the court denied or limited amendments, and ultimately the judgment was appealed.
- The appellate court affirmed the summary judgment, sanctions against VJA and its counsel, and related fee orders.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 33-1807(B)(2) priority creates subordination to a first deed of trust | VJA asserts Banks have priority only if a first deed of trust is first recorded. | Banks contend the statute plainly prioritizes assessment liens except for a recorded first deed of trust, regardless of timing. | Statute plain meaning controls; assessment liens are superior except to a recorded first deed of trust. |
| Whether the judgment as to all parcels was proper | VJA argues the judgment broad-sweeps parcels where Banks had limited interests; should be narrower. | Banks and court treated parcels consistently with the motion; judgment does not extend beyond rights addressed. | Judgment appropriately addressed all parcels described; not a windfall to Banks. |
| Rule 11 sanctions were warranted | VJA contends there was reasonable basis and reliance on a litigation guarantee; no Rule 11 violation. | VJA's interpretation contradicted clear statutory language; lack of reasonable inquiry supports sanctions. | Rule 11 sanctions affirmed; position of priority was not objectively reasonable. |
| Denial of motion for new trial and related amendments | Oral amendment should have been allowed under Rule 59(c)(1). | Rule 59(c)(1) requires amendments to be in writing; oral amendments undermine procedure. | Order denying oral amendment affirmed; no abuse of discretion in denying new-trial relief. |
| Attorney fees on appeal | VJA seeks no explicit challenge to fee awards; Banks rely on § 33-1807(H) and Rule 25. | Banks are prevailing party; sanctions and appellate fees justified for frivolous appeal. | Banks awarded appellate fees and costs; sanctions under Rule 25 upheld. |
Key Cases Cited
- Bothell v. Two Point Acres, Inc., 192 Ariz. 313 (Ariz. App. 1998) (standard for reviewing summary judgment on appeal)
- Airfreight Express Ltd. v. Evergreen Air Ctr., Inc., 215 Ariz. 103 (Ariz. App. 2007) (de novo review of questions of law in summary judgment)
- Zamora v. Reinstein, 185 Ariz. 272 (Ariz. 1996) (interpretation of statutory purpose and language)
- State v. Williams, 175 Ariz. 98 (Ariz. 1993) (statutory construction principles)
- Hobson v. Mid-Century Ins. Co., 199 Ariz. 525 (Ariz. App. 2001) (statutory interpretation and plain meaning rule)
- Clear Channel Outdoor, Inc., 209 Ariz. 544 (Ariz. 2005) (interpret statutes according to plain meaning)
- Standage v. Jaburg & Wilk, P.C., 177 Ariz. 221 (Ariz. App. 1993) (Rule 11 good faith standard; objective reasonableness)
- Wolfinger v. Cheche, 206 Ariz. 504 (Ariz. App. 2003) (objective basis for pursuing claims under Rule 11)
- Fernandez v. Takata Seat Belts, Inc., 210 Ariz. 138 (Ariz. 2005) (standing related to class claims)
- U-Totem Store v. Walker, 142 Ariz. 549 (Ariz. App. 1984) (surprise and procedural fairness considerations)