Estate of Parker v. Sedona Golf Resort, L.C.

The Estate of Ella Parker (“Estate”) appeals a district court decision affirming the bankruptcy court’s ruling quieting title to a piece of property (“the road”) in Sedona, Arizona in favor of Parker’s opponent, Sedona Golf Resort (“the Resort”). We affirm. Because the parties are familiar with the factual and procedural history of this case, we will not recount it here.

I

The bankruptcy court did not err in concluding that Ella Parker did not acquire an interest in the road through foreclosure on Kenneth Parker’s shares of stock in the Ridge at Sedona, Inc. (“RSI”). *600 The Estate argues that when RSI’s corporate charter was revoked in 1990, all its assets, as a matter of law, devolved to its shareholders, which included Kenneth Parker who owned 70 percent of RSI. The Estate further asserts that Ella Parker acquired Kenneth Parker’s stock in 1991 when she foreclosed on a lien.

The bankruptcy court correctly concluded that, under Arizona law, the assets of the corporation are not automatically transferred to its shareholders upon mere involuntary revocation of the corporate charter. Indeed, Arizona law permits corporations whose charters have been revoked to continue to take…