A case about judgment liens and, in passing, memorandum opinions.

The plaintiffs took a default judgment for money and recorded it. Their debtors then acquired real property that they later sold to the DeBords. Under the statutes (33-961ff) and cases the rule has been that filing creates a lien against the debtor’s present or after-acquired property and that purchasers from the debtor take subject to the lien. In this action the plaintiffs sought to foreclose their judgment lien against it.

The problem was that in 1996 the statutes were amended to add a requirement that along with the judgment the creditor file an information sheet specifying some things about the debtor and the lawsuit. The plaintiffs didn’t file one until after they filed this action. The DeBords moved for summary judgment, arguing that this invalidated the lien. The plaintiffs argued that it merely affected the priority of their lien against other judgment creditors – of which there were none, so its lien was unharmed.

The trial court ruled for the DeBords. The Court of Appeals affirms, though its not clear whether for the same or different reasons.

After analyzing the history and structure of the statute the court agrees with the plaintiffs that failure to file the information sheet affects the priority, not the validity, of the lien.

But the court disagrees with the plaintiffs about its priority. The statute (33-967(D)) says that a judgment “has as its priority the date of [filing the information sheet].” “If the legislature wanted to limit the concept of priority . . . to the interests of competing lienholders . . . it could have said so.” “Priority” therefore includes not only competing lienholders but subsequent purchasers. Since the DeBords took the property before the information sheet was filed “[their] interest in the property has priority over the  . . . judgment lien.” So the DeBords win anyway.

We can’t quite get our head around this one. In what sense is a lien valid against property the owner of which has an interest that has “priority” over the lien? Since when does, or can, a lien statute use “priority” in the context of an ownership interest?

But what about memorandum decisions, you ask? The plaintiffs cited an opinion that mentioned that an earlier memorandum in that case had held that failure to file an information sheet didn’t invalidate a judgment lien. In one of several long footnotes the court points out that memoranda are not precedent and adds that courts “do not treat passing references to previous memorandum decisions in published opinions as precedent.” Since the court purports to agree that failure to file the sheet doesn’t invalidate the lien the purpose of this footnote is to discourage the memo-cited-in-a-later-opinion loophole. The courts want to limit the loopholes to the ones they are creating themselves by rule changes.

(link to opinion)

One of the reasons for publishing an opinion is to remind people of the law; that was presumably the thinking here so we’ll blog it for the same reason.

The Boyles sued Ford when their truck burned up in their driveway. Ford made an Offer of Judgment; the Boyles did not respond to it and then lost at trial. When Ford moved for Rule 68 sanctions the Boyle’s objected. The trial court awarded sanctions, ruling that the Boyle’s objection was hyper-technical and that they had waived it. It surely was the former; the latter is the basis of this opinion affirming the award.

Rule 68(d) now requires (and has since 2007, though since many lawyers haven’t read rules since they left law school that is recently enough to catch a fair number off guard) that objections to an OJ be filed within ten days on pain of waiver. The Boyles argued that objections must be filed when there are mistakes in the OJ but not when there is some basic defect in it that renders it invalid. But they were apparently making that up almost entirely out of whole cloth without authority; the rule makes no such distinctions. The court holds that the offeree must inform the offeror of “any” objections to the OJ.

(link to opinion)

Now that Rule 68 law has – like so much of our tort law and procedure – moved from a world of clear rules to a murky realm of maybes arguments like this are not uncommon.

In this personal-injury case the defendant made an Offer of Judgment “contingent on the satisfaction of all liens.” At trial the plaintiff received an award that was less than the OJ but more than she would have ended up with had she accepted it and used it to pay her liens. Her lawyer therefore argued that she shouldn’t have to pay Rule 68 sanctions, that the lien amount shouldn’t count. The trial court disagreed; she appealed.

The Court of Appeals affirms. The plaintiff had an Alaska Supreme Court case but the court distinguishes it and says that in any event the terms of our rule do not permit correcting for liens. Even if they did, the result would be an improper comparison between an OJ that did not include liens and a trial award that did.

Whether lien language in an OJ is technically necessary or not, liens have become enough of a problem that its inclusion is understandable. This is an uncommon example of a qualification on an OJ that doesn’t either nullify it or, even if valid under the present version of the rule, make its application difficult to compute.

(link to opinion}