Brant v. Hargrove
129 Ariz. 475, 632 P.2d 978 (1981)
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Rule of Law:
In Arizona, the execution of a deed of trust by one joint tenant on their interest in the property does not sever the joint tenancy. Consequently, upon the death of the non-encumbering joint tenant, the surviving joint tenant acquires the entire property subject to the deed of trust, which then attaches to the full fee interest.
Facts:
- Nick Mercer and his wife, Anastasia Mercer, owned real property as joint tenants with the right of survivorship.
- A promissory note and deed of trust were created for a loan from Edmund and Dolores Brant, encumbering the Mercer's property as security.
- The deed of trust was executed by Nick Mercer and also bore the purported signature of Anastasia Mercer.
- The personal representative and heirs of Anastasia Mercer's estate contended that Anastasia's signature on the deed of trust was not genuine.
- Anastasia Mercer died prior to the commencement of foreclosure proceedings.
- Nick Mercer survived Anastasia Mercer.
Procedural Posture:
- Edmund and Dolores Brant (plaintiffs-appellees) filed a foreclosure action in an Arizona trial court against the personal representative and heirs of Anastasia Mercer's estate (defendants-appellants).
- The Brants moved for partial summary judgment on the issue of whether the deed of trust was a valid lien on the property.
- The trial court granted the Brants' motion for partial summary judgment.
- Following a trial on the remaining issue of usury, the trial court entered a final judgment in favor of the Brants.
- The personal representative and heirs of Anastasia Mercer's estate appealed the judgment to the Court of Appeals of Arizona, Division One.
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Issue:
Does the execution of a deed of trust by one joint tenant, without the consent of the other, sever the joint tenancy?
Opinions:
Majority - Haire, J.
No, the execution of a deed of trust by one joint tenant does not sever the joint tenancy relationship. In Arizona, a deed of trust, like a mortgage, is treated as a lien for security purposes and does not destroy the unities required for a joint tenancy. While a deed of trust technically transfers bare legal title to a trustee, it does not convey the essential incidents of ownership and is functionally equivalent to a mortgage under the lien theory. Because the encumbrance by Nick Mercer did not sever the joint tenancy, the right of survivorship remained intact. Therefore, upon Anastasia Mercer's death, Nick Mercer became the owner of the entire property as the surviving joint tenant, and the lien from the deed of trust attached to the entire fee interest.
Analysis:
This case establishes a significant precedent in Arizona property law by aligning the treatment of deeds of trust with mortgages under the modern lien theory for purposes of joint tenancy severance. By holding that a deed of trust does not sever a joint tenancy, the court prioritized the functional substance of the instrument (a security interest) over its technical form (a conveyance of bare legal title). This decision provides clarity and predictability for lenders and property owners, confirming that an encumbrance by one joint tenant will not defeat the right of survivorship, and the lien will attach to the entire property if the encumbering tenant survives.
