14.16 Deed of Trust Recorded before Work Commenced

• Library: Real Estate Practice Deskbook (2019 Ed.)

1. (§14.16) Deed of Trust Recorded Before Work Commenced

Section 429.050, RSMo 2016, defines the rules of priority when a deed of trust is given and recorded before the construction begins. In general, the statute provides that the subsequent lien claimant, as a matter of law, obtains a prior and superior interest in the "improvement[ ]." The deed of trust holder retains a superior interest in the land. See Union Elec. Co. v. Clayton Ctr. Ltd., 634 S.W.2d 261 (Mo. App. E.D. 1982). Also, when a deed of trust secures an indebtedness for purchase of land and construction of new improvements, the Court held that the deed of trust had priority as to the land but not the improvements over a subsequently recorded mechanic's lien. Westinghouse Elec. Co. v. Vann Realty Co., 568 S.W.2d 777 (Mo. banc 1978).

Section 429.050 further provides that, when the property is subject to a deed of trust having priority on the land only, the lien claimant may have the improvement sold under execution, and the purchaser may remove the improvement. Union Elec., 634 S.W.2d 261. The removal right does not extend to sidewalks. Section 429.050. Also, the court may not, even in an equitable proceeding, decree that the building and land be sold together with the proceeds of sale apportioned between a mechanic's lienor who had priority

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