Irving Place Assocs. v. 628 Park Ave, LLC

• Decision Date: 13 November 2015
• Docket Number: No. 20130937.,20130937.
• Citation: 362 P.3d 1241
• Parties: IRVING PLACE ASSOCIATES, Petitioner, v. 628 PARK AVE, LLC, Respondent.
• Court: Utah Supreme Court

362 P.3d 1241

IRVING PLACE ASSOCIATES, Petitioner,

v.628 PARK AVE, LLC, Respondent.

No. 20130937.

Supreme Court of Utah.

Nov. 13, 2015.

Bruce H. Shapiro, Andrew M. Wadsworth, Salt Lake, for petitioner.

Ronald G. Russell, Rodger M. Burge, Salt Lake, for respondent.

Associate Chief Justice LEE authored the opinion of the Court, in which Chief Justice DURRANT, Justice HIMONAS, and Judge BRADY joined.

Having recused herself, Justice DURHAM does not participate herein; District Court Judge M. JAMES BRADY sat.

Associate Chief Justice LEE, opinion of the Court:

¶ 1 By statute, a "judgment entered by a district court or a justice court" in Utah "becomes a lien upon real property if: (i) the judgment or an abstract of the judgment containing the information identifying the judgment debtor described in Subsection 78B–5–201(4) is recorded in the office of the county recorder; or (ii) the judgment or an abstract of the judgment and a separate information statement of the judgment creditor as described in Subsection 78B–5–201(5) is recorded in the office of the county recorder." UTAH CODE § 78B–5–202(7)(a) (2008).¹ We are asked to interpret this provision in this case. In the proceedings in the district court, a default judgment was entered against James P. Ring and in favor of 628 Park Avenue LLC. Respondent 628 Park Avenue claims to have acquired a judgment lien by recording that judgment—a judgment that was nonfinal because claims against other defendants remained pending when it was entered.

¶ 2 We hold that 628 Park Avenue failed to acquire a judgment lien under the applicable statutory provisions. First, we conclude that only a final judgment qualifies as a "judgment" sustaining a lien under Utah Code section 78B–5–202(7). Second, and alternatively, we find that 628 Park Avenue's judgment failed to include "the information identifying the judgment debtor" required by section 78B–5–202(7)(a)(i).

I

¶ 3 In late September 2008, 628 Park Avenue filed a complaint asserting claims for unlawful detainer, breach of a promissory note, breach of lease, and declaratory relief against James Ring and other defendants. Ring failed to file an answer by mid-November and the court entered default. About three weeks later, in December 2008, the court entered a default judgment against Ring for $150,144. The claims against the remaining defendants remained pending. And the default judgment against Ring was not certified as final under Utah Rule of Civil Procedure 54(b).

¶ 4 Ring was the record owner of a condominium unit in Park City at the time the default judgment was entered. With that in mind, 628 Park Avenue recorded a copy of the default judgment in the Summit County Recorder's Office one week after the default judgment was entered. The recorded default judgment identified James P. Ring as the judgment debtor. But it contained no other identifying information.²

¶ 5 Ring conveyed the Park City property to Irving Place Associates by warranty deed in March 2009. Irving Place claims that it was not aware of any alleged judgment lien by 628 Park Avenue at that time. It claims that it believed it was taking the property free of any liens or encumbrances.

¶ 6 In November 2009, 628 Park Avenue subsequently obtained an augmented judgment against Ring in the amount of $498,204. Thereafter, 628 Park Avenue recorded the augmented judgment—a recording that this time included the separate information statement containing the information called for in Utah Code section 78B–5–201(4)(b). 628 Park Avenue then obtained a writ of execution on the augmented judgment, directing the sale of all of Ring's nonexempt real property.

¶ 7 628 Park Avenue sought to apply the writ of execution to the Park City property that Ring had deeded to Irving Place—citing Ring's ownership of the property at the time the original default judgment was recorded. A day before a scheduled sheriff's sale, Irving Place filed a declaratory judgment action seeking to invalidate 628 Park Avenue's claimed judgment lien on the Park City property.

¶ 8 The district court initially entered a preliminary injunction blocking the sheriff's sale during the pendency of the declaratory judgment action. But it ultimately entered summary judgment against Irving Place and in favor of 628 Park Avenue, holding that 628 Park Avenue possessed a valid judgment lien against the property in the amount of the original default judgment.³

¶ 9 First, the district court noted that the operative statute speaks of liens on a "judgment"—not "final judgment"—and thus concluded that a nonfinal default judgment could qualify. Second, the district court determined that the informational requirements of the statute were satisfied by the identification of the judgment debtor in the judgment recorded with the recorder's office.

¶ 10 A divided panel of the Utah Court of Appeals affirmed. Irving Place Assocs. v. 628 Park Ave., LLC, 2013 UT App 204, 309 P.3d 260. On the first issue the panel unanimously agreed that the "judgment[s]" covered by the statute encompassed nonfinal judgments. Id. ¶¶ 9–12. On the second issue, the panel was divided. The majority agreed with the district court—concluding that the statute could be satisfied by the submission of a judgment identifying the debtor by name. Id. ¶¶ 13–17. The dissent interpreted the statute differently. It concluded that the mere identification of a judgment debtor on the face of a judgment was insufficient, and would have interpreted the statute to require the judgment (or abstract) to include "the same specific information" required in the separate information statement under Utah Code section 78B–5–201(4)(b). Id. ¶¶ 19–27.

¶ 11 Irving Place filed a petition for certiorari, which we granted. The petition presents legal questions of statutory interpretation. We consider such issues de novo, affording no deference to the district court's legal conclusions. See, e.g., Manzanares v. Byington (In re Adoption of Baby B. ), 2012 UT 35, ¶ 41, 308 P.3d 382.

II

¶ 12 As a general rule "a judgment entered in a district court" may sustain a "lien upon" real property in Utah. UTAH CODE § 78B–5–201(3)(a) (2008). The code prescribes two alternative means of establishing such a lien: "(i) the judgment or an abstract of the judgment containing the information identifying the judgment debtor as described in Subsection 78B–5–201(4) is recorded in the office of the county recorder; or (ii) the judgment or an abstract of the judgment and a separate information statement of the judgment creditor as described in Subsection 78B–5–201(5) is recorded in the office of the county recorder." Id. § 78B–5–202(7)(a) ; see also § 78B–5–201(4)(a)–(b) (requiring either the recording of a judgment or abstract of judgment including "the information identifying the judgment debtor" or a copy of a "separate information statement," and specifying the terms of the separate statement).

¶ 13 Irving Place challenges the judgment lien at issue in this case on two statutory grounds. First, it asserts that the "judgment" sustaining a lien under the above provisions must be a final judgment. Second, it contends that the recorded judgment in this case was insufficient because it merely identified the judgment debtor by name and did not provide sufficient "information" as required by our law. We agree on both counts and reverse.

A

¶ 14 On the question of whether a nonfinal default judgment qualifies as a "judgment" subject to a statutory lien, the court of appeals found the governing statutory language "plain." Irving Place Assocs. v. 628 Park Ave., LLC,

2013 UT App 204, ¶ 9, 309 P.3d 260. It based that determination on the fact that the operative provisions "utilize the term ‘judgment’ multiple times, but neither contains the term ‘final judgment.’ " Id. ¶ 10. Quoting the district court, the court of appeals reasoned that the legislature "could have ... used the term ‘final judgment’ " if it had "intended that a judgment be final in order for a judgment lien to be created." Id. Lastly, the court of appeals noted that "the legislature has used the specific term ‘final judgment’ in lieu of the more general term ‘judgment’ elsewhere in Title 78B of the Utah Code." Id. ¶ 11 (citing UTAH CODE § 78B–11–129(1)(f) )("An appeal may be taken from ... a final judgment entered pursuant to this chapter."); UTAH CODE § 78B–5–828(1)(c) ( " ‘Ultimately prevail on the merits' means, in the final judgment, the court rules in the plaintiff's favor on at least one cause of action.").

¶ 15 Unlike the court of appeals, we do not find the governing statutory language "plain." On the question presented here, there is threshold ambiguity in the word "judgment." This legal term of art can convey two different meanings. When the law speaks of a "judgment," it sometimes has reference only to a disposition of the claims and defenses of individual parties—even a nonfinal disposition that leaves other claims, including claims involving other parties, to be resolved in further litigation.⁴ Yet that is by no means the only notion of "judgment." Sometimes "judgment" is used to refer to a final, appealable order—a decision that disposes of all claims asserted by all parties, in a manner triggering an appeal of right.⁵

¶ 16 We cannot resolve this ambiguity by noting that the statutory reference is only to the ambiguous term "judgment," not the unambiguous phrase "final judgment." The latter formulation certainly would have eliminated any ambiguity. And it is true that the legislature "could have" used this unambiguous phrase. Irving Place, 2013 UT App 204, ¶ 10, 309 P.3d 260. But the legislature's failure to speak more clearly tells us little or nothing about its intent in using terms that are less clear. "In any matter of statutory construction of any consequence, it will almost always be true that the legislature could have more clearly repudiated one party's preferred construction. But the converse is almost always true as well...." Hill v. Nakai (In re Estate...