BMO Harris Bank N.A. v. Wildwood Creek Ranch, LLC

OPINION

GOULD, Judge.

¶ 1 BMO Harris Bank (“BMO”) appeals the trial court’s grant of partial summary judgment in favor of Wildwood Creek Ranch, LLC (“Wildwood”), and Shaun and Kristina Rudgear (“the Rudgears”). In making its ruling, the trial court relied on M & I Marshall & Ilsley Bank v. Mueller, 228 Ariz. 478, 268 P.3d 1135 (App.2011), and concluded the Rudgears’ intent to build a home on the Property protected them from a deficiency judgment under Arizona Revised Statute (“A.R.S.”) section 33-814(G) (Supp.2012).1 Because we find that A.R.S. § 33-814(G) does not apply to vacant land, we reverse and remand to the trial court for entry of partial summary judgment in favor of BMO.

FACTUAL AND PROCEDURAL HISTORY

¶ 2 In March 2006, Wildwood obtained a $296,200 loan (“the Loan”) through BMO’s predecessor in interest, M & I Marshall and Ilsley Bank. The Loan was secured by a deed of trust on an unimproved, vacant lot (“the Property”). The Rudgears personally signed the mortgage note, apparently on behalf of Wildwood, a limited liability company of which they are the sole members. The Rudgears also personally guaranteed the Loan.

¶ 3 The Loan was renewed in 2009, extending its maturity date to 2011. However, in April 2011, both Wildwood and the Rudgears defaulted on their obligations. BMO foreclosed on the Property through a trustee’s sale and thereafter sued Wildwood and the Rudgears to obtain a deficiency judgment in the amount of the unpaid balance of the Loan.

¶ 4 Significantly, at no time was there any construction on the Property; it remained vacant throughout the term of the Loan until the time of the trustee’s sale.

¶ 5 The parties cross-moved for partial summary judgment on all issues relating to the Rudgears’ deficiency liability. The Rudgears argued that as a matter of law BMO was precluded from recovering the deficiency because they intended to build a single one-family dwelling on the Property. The Rudgears submitted affidavits avowing it was their intent to build a home on the Property and occupy it as their primary residence. In response, BMO offered evidence that the Rudgears owned three separate parcels, each of which they purportedly intended to use as their “primary residence.”

¶ 6 The trial court granted summary judgment for Appellants. Relying on Mueller, *102the court determined that no material evidence contradicted the Rudgears’ affidavits, and that summary judgment was appropriate because the affidavits showed that the Rudgears intended to utilize the vacant Property as a single one-family dwelling. BMO timely appealed. We have jurisdiction pursuant to Article 6, Section 9, of the Arizona Constitution and AR.S. § 12-2101(A)(1) (Supp.2012).

STANDARD OF REVIEW

¶ 7 Summary judgment is appropriate if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Ariz. R. Civ. P. 56(a). We review a grant of summary judgment de novo and “view[] the evidence and reasonable inferences in the light most favorable to the party opposing the motion.” Andrews v. Blake, 205 Ariz. 236, 240, ¶¶ 11,12, 69 P.3d 7, 11 (2003).

DISCUSSION

¶ 8 This case involves construction of AR.S. § 33-814(G), which provides that:

If trust property of two and one-half acres or less which is limited to and utilized for either a single one-family or a single two-family dwelling is sold pursuant to the trustee’s power of sale, no action may be maintained to recover any difference between the amount obtained by the sale and the amount of the indebtedness and any interest, costs and expenses.

(Emphasis added.) Under the terms of the statute, a party seeking protection from a deficiency judgment must prove the following: (1) the property was encumbered by a deed of trust; (2) the property consists of two and one-half acres or less; (3) the property is limited to and utilized for a single one-family dwelling or a single two-family dwelling; and (4) the property was sold at a trustee’s sale. A.R.S. § 33-814(G).

¶ 9 Here, there is no dispute that the Property was encumbered by a deed of trust, is less than two and one-half acres, and was sold at a trustee’s sale. The sole issue is whether the Property was limited to and utilized for a one-or two-family dwelling within the meaning of AR.S. § 33-814(G).

¶ 10 In looking at the plain language of the statute, we conclude the protection for “dwellings” under A.R.S. § 33-814(G) does not apply to vacant land. “Where the language of a statute is plain and unambiguous, courts must generally follow the text as written.” Mid Kansas Fed. Sav. & Loan Ass’n of Wichita v. Dynamic Dev. Corp., 167 Ariz. 122, 128, 804 P.2d 1310, 1316 (1991). To interpret the word “dwelling,” we must give the word its ordinary meaning, “unless a specific definition is given or the context clearly indicates a special meaning was intended.” Mein ex rel. Mein v. Cook, 219 Ariz. 96, 99 n. 2, ¶ 12, 193 P.3d 790, 793 n. 2 (App.2008). As recognized by our supreme court, “[t]he word ‘dwelling’ is susceptible to several interpretations, depending on the context of its use.” Mid Kansas, 167 Ariz. at 128, 804 P.2d at 1316 (citation omitted). “However, the principal element in all such definitions is the ‘purpose or use of a building for human abode,’ meaning that the structure is wholly or partially occupied by persons lodging therein at night or intended for such use.” Id. Similarly, this court has described a dwelling as “a shelter ... in which people live.” Indep. Mortg. Co. v. Alaburda, 230 Ariz. 181, 183, ¶ 8, 281 P.3d 1049, 1051 (App. 2012). Given these definitions, it is clear that unimproved, vacant land cannot be properly characterized as a “dwelling.”2

¶ 11 Here, it is undisputed that the Property is unimproved, vacant land. It was never used as a dwelling prior to the trustee’s sale, and therefore was not utilized as a “dwelling” under § 33-814(G). See PAM Transp. v. Freightliner Corp., 182 Ariz. 132, 133, 893 P.2d 1295, 1296 (1995) (“[I]f a statute specifies under what conditions it is effective, we can ordinarily infer that it excludes all others.”). As a result, under the facts of this case the Rudgears’ professed intent to *103construct a home on the Property is irrelevant.

¶ 12 Accordingly, we conclude as a matter of law the Rudgears are not entitled to invoke the protection of A.R.S. § 33-814(G) because the Property consisted of vacant land and was not utilized as a dwelling. We therefore reverse the trial court’s grant of partial summary judgment, and remand to the trial court for an entry of partial summary judgment in favor of BMO.

. We cite to the current versions of statutes unless they have been materially amended since the proceedings below.

. Unlike Mueller, which addressed a situation where construction of a dwelling had commenced on a lot, the Property here was vacant and there was no construction. Mueller, 228 Ariz. at 480, ¶ 11, 268 P.3d at 1137. We conclude, therefore, that Mueller is not applicable to the facts of this case. See id.