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Dart v. Western Savings & Loan Association
Supreme Court of Arizona
103 Ariz. 170, 438 P.2d 407 (1968)
Union Title Company (Union) was the trustee of a trailer park subject to a mortgage held by Western Savings and Loan Association (Western) (plaintiff). Union managed the property poorly, embezzled funds from the trust, and failed to pay the mortgage. William Dart (defendant), the residuary beneficiary of the trust, took possession of the trailer park. Dart began maintaining the trailer park properly and collected monthly rent. Western’s mortgage provided for assignment of rents as security and stated that if a foreclosure action was brought, a receiver “shall be appointed.” Western filed an action to foreclose the mortgage and appoint a receiver. Dart objected to the appointment of a receiver. Western acknowledged at trial that its security interest in the property was not in jeopardy now that Dart was managing the trailer park. The trial court appointed a receiver based on the terms in the mortgage. Dart appealed.
Rule of Law
Holding and Reasoning (Struckmeyer, J.)
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