In Morgan AZ Financial, LLC v. Goteses Division One of the Arizona Court of Appeals ruled that the buyer of two undeveloped lots which were lost in a Trustee’s Sale, was nevertheless entitled to assert common law defenses to a deficiency action filed to collect the difference between what the buyer owed on the secured note and what the sale of the property generated in the Trustee’s Sale. The lender argued that Arizona law requires that in order for a buyer to assert common law defenses to collection of the deficiency, the buyer must act to prevent the Trustee’s Sale, or be deemed to have waived any such defenses. The Court of Appeals pointed out that the Arizona cases on this issue made clear that a buyer waives only claims against the way in which the Trustee’s Sale is handled by failing to enjoin a sale in advance. Common law defenses to the collection of the underlying promissory note via the deficiency action are not barred by the holding of the Trustee’s Sale, only defenses to the Sale itself are thereby waived. Such defenses could include failure to make a demand, whether there has been an actual default or the calculation of the balance due. Although the Courts have held in recent years that in actions to enjoin Trustee’s Sales, the beneficiary/Trustee are not required to present the original note in Court to be allowed to go forward with the Sale, the same may not hold true in regard to actions for a deficiency.