Cutler v. Kodiak Island Borough

The primary issue in this appeal was whether boroughs have the implied or incidental authority to record a real property lien to secure payment of garbage-collection fees. In 2007 Virgilio and Rosemarie Sabado hired had a fire-damaged house on their property in Kodiak torn down. The contractor opened a commercial garbage account with the Kodiak Island Borough (Borough) and paid a deposit for placement of a construction dumpster near the property. Approximately $5,000 in garbage-service charges accrued. The Borough applied the deposit to this amount and began sending the contractor monthly bills for the balance. No payment was made and the account became delinquent. In October 2008 the Sabados sold the property to Cedric Cutler, who was unaware of the garbage account with the Borough. In December the Borough sent the contractor a letter advising him that a lien could be placed on the property if the account remained unpaid. No payment was made, and in January 2009 the Borough recorded a lien against the property. The Borough then sent lien-notice letters to the contractor and the Sabados, who were still listed as the property owners in the Borough’s tax files. In February 2010 the Borough petitioned to foreclose outstanding tax and garbage-service liens for years 2009 and prior. Cutler learned of the foreclosure proceeding and filed an answer and counterclaim, asserting the lien against his property was invalid and seeking damages for wrongful recording of a nonconsensual common law (NCCL) lien. Cutler appeals the superior court’s summary judgment ruling and default judgment entry with respect to the other garbage-service liens. Upon review, the Supreme Court concluded that boroughs did not have the authority to record liens to secure payment for garbage collection fees. View "Cutler v. Kodiak Island Borough" on Justia Law