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Burris & MacOmber, PLLC > Articles > Property Law > Residential Property Held in Trust Not Subject to Lien of Subcontractor

- Residential Property Held in Trust Not Subject to Lien of Subcontractor -

In Williamson v. PVOrbit, Inc. Division One of the Arizona Court of Appeals sided with an elderly couple over the interests of a vendor of custom doors.  At the request of a contractor, Freedom Architectural Builders, PVOrbit, supplied custom doors to the Williamson home remodel. The Williamsons paid Freedom in full, but it eventually defaulted and quit the job, without paying PVOrbit for the custom doors.  PVOrbit recorded a mechanic’s lien against the house.  The Williamsons sued to quash the lien and for damages against PVOrbit for recording a false claim of lien.  The lien issue surrounded the fact that the Williamsons had, in 2005, deeded their home to a family trust, of which they were the trustors and the beneficiaries.  ARS ’33-1002 prohibits the recording of a lien against an owner-occupied dwelling unless the lienor has a contract in writing with the owner of the property.  PVOrbit argued that the Williamsons did not qualify as owner-occupants because the property was titled in the name of their family Trust. The Court of Appeals agreed with the Williamsons that legal title was held not by the Trust, but by them as Trustees.  That alone was sufficient to find that they qualified as owner-occupants.  The Court of Appeals reversed the award of $6,000 against PVOrbit for damages and attorneys fees on the grounds that the issue was one of first impression in Arizona and thus a summary ruling in favor of the Williamsons was inappropriate and so sent the issue of damages and fees back to the trial court for a final determination.

 

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