Icing

RV Associates jumps to the front of the line for those looking to foreclose or collect on the ice arena bankruptcy. I think the real purpose is for the company to collect on a bill. There’s no indication I’ve seen any of this will impact the day-to-day operations of the rink.

The story itself was short relative to others that we write, but was one of those that took a lot of detailed reading of a court decision and learning about legal issues that I found somewhat complicated. I learned a lot reading the court ruling, and if it were to get appealed to the Supreme Court I’d probably learn even more.

For example, I had to learn what a mechanic’s lien was. I may be oversimplifying, but my understanding is that it’s a lien a contractor can file if there is a payment default by the owner. The problem is that those liens don’t get filed until there is a problem. So in this case, RV Associates filed its lien after the Haselwoods and Mr. Meakin recorded the loan.

State law, however, protects contractors in recognition that most mechanic’s liens are only filed as a result of a late payment. Otherwise, contractors would have little recourse, especially in a case such as this where the lender actually became the owner.

Another complicating factor was the city property underneath. State law doesn’t allow you to file mechanic’s liens on public property. One of the arguments was over the City of Bremerton’s responsibility in the matter, because the Haselwoods do not own the property, they own the rink. The city still owns the land and the rink operates under a concession agreement.

The court determined the city wasn’t liable and ultimately put RV Associates in first position on the original note, which allows the company to go back to trial court and try to collect the amount it didn’t get, plus interest and attorneys fees.