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Citizens Bank & Trust v. Brothers Construction & Manufacturing, Inc.

Court of Appeals of Arkansas
859 P.2d 394 (1993)


Facts

Citizen’s Bank and Trust (the bank) (plaintiff) held two mortgages against a property. Brothers Construction and Manufacturing, Inc. (Brothers) (defendant) leased the property and occupied it. Brothers did not record its lease in county records. A mechanic’s lien against the property resulted in the bank foreclosing on its mortgages. However, the bank did not join Brothers as a party to the foreclosure action, even though the bank had actual knowledge that Brothers was occupying the property. The bank purchased the property at the foreclosure auction, then demanded that Brothers vacate the property. Brothers refused, prompting the bank to institute a forcible detainer action. The trial court granted summary judgment for Brothers, and the bank appealed.

Rule of Law

Issue

Holding and Reasoning (Lewis, J.)

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