Baskurt v. Beal

101 P.3d 1041 (Alaska 2004)

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Nature of the Case

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Facts

Beal (P) purchased two adjoining parcels of property in 1991 for $95,000 and $135,000. The two promissory notes were secured by a single deed of trust covering both parcels containing the following special condition: 'This deed of trust is covered by 2 Promissory Notes, and Trustor is aware that default on either of the 2 Note [sic], will constitute default under the other Note and foreclosure laws of the State of Alaska shall apply.' The deed of trust also provided that 'upon default by Trustor in payment of any indebtedness secured hereby . . . Trustee . . . shall,' at the option of the Beneficiary, 'sell said property, . . . either as a whole or in separate parcels and in such order as it may determine, at public auction to the highest and best bidder . . . .' In 1994 Annette paid off the $ 95,000 owed on Note A for Parcel 1 to Mortimer. At that time, there was some discussion regarding paying off Note B, but Marion preferred to continue to receive monthly payments rather than being paid off in a single lump sum. Marion did agree to a reduction of the interest rate on Note B. The 1991 deed of trust was modified to reflect the payoff of the note to Mortimer and the change in interest rate on Marion's note. In the fall of 1999, P fell behind in her payments. At that time, P owed $26,780.81 on Parcel 2, having paid approximately eighty percent of the original $135,000 purchase price. D had become trustee on the note after Marion died in 1998. D foreclosed on both properties. D contacted friends to bid on the property. The partnership trio at least $251,000 available to put toward the purchase price of the property. The foreclosure sale was conducted by public outcry and D made a bid $1 over the amount due and won. P filed a complaint against D seeking to have the sale set aside. Ds moved for summary judgment and it was denied. The superior court set aside the foreclosure sale as both void and voidable. D appealed.