Opinion handed down September 11,
2012
In June 2008, Blue Springs
Xtreme Powersports purchased property using loan funds obtained from Hawthorn
Bank; as security for the loan, Hawthorn Bank took a purchase-money deed of
trust on the property, but failed to record it until November 2008.[2] Prior to recording the deed, Xtreme
Powersports hired two contractors, DeGeorge and KSD Christian, to make
improvements on the property. After
Xtreme failed to pay the contractors several months later, the contractors
filed a mechanic’s lien against Xtreme’s property.[3] Although Hawthorn Bank’s deed of trust was
not recorded at the time the contractor’s began making improvements on the
property, Hawthorn Bank claimed its deed had priority over the contractors’
mechanic’s liens. The Supreme Court of
Missouri looked to well-established statutory and case law regarding priority
interests between mechanic’s liens and deeds of trust on the same property.[4] Ultimately, the Court held that the
contractors’ mechanic’s liens had superior priority because Hawthorn’s deed of
trust was unrecorded at the time the contractors’ liens “attached” to the
property, which was consistent with traditional Missouri law on the subject.[5]