LaSalle Bank National Association v. Cypress Creek I, L.P.

This case presents question as to whether trial court erred in apportioning proceeds of Sheriff's sale of piece of foreclosed property that gave only percentage recovery to two holders of perfected mechanics liens while permitting mortgagee of said property to be subrogated to status of mechanics lien claimant for monies it paid in construction and development costs through funding draws from trust. Appellate Court, in reversing trial court, found that claimants with perfected mechanics liens are not required to share sale proceeds with anyone except other claimants with perfected mechanics liens, and that while instant mortgagee could be subrogated in amount of $30,702 that it paid for third-party's perfected lien, it could not be subrogated for remaining $1.5 million in construction and development costs since instant mortgagee was essentially attempting to be subrogated for materialmen, who had been paid as work progressed, but who did not have perfected liens. (Partial dissent filed.)