NOTICE: NOT FOR OFFICIAL PUBLICATION.

UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL

AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE

ARIZONA COURT OF APPEALS

DIVISION ONE

AMERICAN WEST BANK, et al., Plaintiffs/Appellees,

v.

SANDY G. KELLIN, Defendant/Appellant.

No. 1 CA-CV 18-0060 

Appeal from the Superior Court in Maricopa County

No. CV2014-095947

The Honorable Margaret Benny, Judge Pro Tempore

AFFIRMED

COUNSEL

Snell & Wilmer L.L.P., Phoenix

By Steven D. Jerome, Benjamin W. Reeves, James G. Florentine

Counsel for Plaintiffs/Appellees

Clark Hill PLC, Scottsdale

By Ryan J. Lorenz

Counsel for Defendant/Appellant

FILED 11-27-2018
AWB, et al. v. KELLIN

Decision of the Court

2

MEMORANDUM DECISION

Judge Maria Elena Cruz delivered the decision of the Court, in which 

Presiding Judge Diane M. Johnsen and Judge Randall M. Howe joined.

C R U Z, Judge:

¶1 Sandy G. Kellin (“Kellin”) appeals the superior court’s order 

granting a writ of execution against a home in Carefree in satisfaction of a 

judgment issued in Utah, and domesticated in Arizona, in favor of Banner 

Bank (“Banner”), the successor-in-interest of American West Bank

(“AWB”). For the following reasons, we affirm the court’s order.

FACTUAL AND PROCEDURAL HISTORY

¶2 In October 2007 Kellin executed a promissory note payable to 

Far West Bank, a division of AWB, in the principal sum of $1,120,000. A 

month later, Kellin and another man executed a second promissory note in 

the principal sum of $958,000. As collateral for the two notes, Kellin 

executed deeds of trust on real property located in Utah. Kellin’s wife, 

Robyn Kellin (“Wife”), did not sign the promissory notes or the deeds of 

trust. Kellin defaulted under the notes.

¶3 Upon Kellin’s default, AWB foreclosed on the Utah real 

property subject to the deed of trust, then obtained a deficiency judgment 

against Kellin in the amount of $1,285,777.89, plus interest.

¶4 While the proceedings in Utah were pending, Kellin and Wife 

completed various transfers of a home in Carefree (“Carefree Property”).

The most recent of those transactions was a conveyance from themselves to 

SRK, LLC, for ten dollars. Kellin and Wife own SRK.

¶5 Banner properly domesticated its Utah deficiency judgment 

in Arizona pursuant to Arizona Revised Statutes (“A.R.S.”) section 12-1702. 

Banner then moved in the superior court of Arizona to obtain a writ of 

special execution to foreclose on its judgment lien on the Carefree Property.

In support of its request for a writ, Banner argued that (1) it had a valid

unsatisfied judgment against Kellin; (2) Banner was entitled under A.R.S. 

§ 12-1551 to have the writ of execution issued against the Carefree Property;

and (3) the transfers between Kellin, Wife, and SRK were fraudulent under 

A.R.S. §§ 44-1004(A)(1)-(2), and 44-1005.
AWB, et al. v. KELLIN

Decision of the Court

3

¶6 The superior court ruled Kellin was subject to a valid 

judgment, then issued the writ of execution against SRK and ordered the 

judgment lien against the Carefree Property be foreclosed and sold. The 

court also ruled the transfers of the Carefree Property between Kellin, Wife, 

and SRK were fraudulent under A.R.S. §§ 44-1004(A)(1)-(2) and 44-1005, 

and that Banner therefore was entitled to avoid the transfers under A.R.S. 

§§ 44-1007 and 12-1635. Kellin now appeals; we have jurisdiction under 

A.R.S. § 12-2101(A)(2).

DISCUSSION

¶7 The first issue is whether the debt underlying the 

domesticated judgment is enforceable against the community.

¶8 Kellin asserts the Carefree Property is owned by the 

community, and argues that A.R.S. § 25-214(C) prevents execution because 

Wife did not sign the notes on which the Utah judgment was based.

1 

Section 25-214(C) states, “Either spouse separately may . . . bind the 

community, except that joinder of both spouses is required in . . . [a]ny 

transaction for the acquisition, disposition or encumbrance of an interest in 

real property” and “any transaction of guaranty, indemnity or suretyship.”

¶9 In support of his contention, Kellin first cites Rackmaster Sys., 

Inc. v. Maderia, 219 Ariz. 60 (App. 2008), and other cases involving guaranty 

obligations executed by one, but not both, spouses. See A.R.S. § 25-214(C). 

But the obligations here did not arise out of a guaranty Kellin executed 

without Wife, and Kellin does not argue otherwise.

¶10 Kellin also argues that § 25-214(C) applies because the notes 

he signed were secured by deeds of trust on real property in Utah, and the 

notes and the deeds of trust must be viewed as parts of the same 

transaction. But the judgment entered against him arose from the notes he 

signed, not from the deeds of trust. Promissory notes and deeds of trust are 

not one and the same. Instead, they are “distinct instruments that serve 

different purposes.” Hogan v. Washington Mut. Bank, N.A., 230 Ariz. 584, 

587, ¶ 10 (2012). Contrary to Kellin’s argument, promissory notes do not 

 

1 Appellee Banner filed a motion to dismiss the appeal arguing Kellin 

lacks standing to challenge execution of the writ under A.R.S. § 25-214(C), 

and further arguing Wife and SRK waived their rights to challenge the 

appealed order. Assuming without deciding that Kellin has standing to 

bring this appeal, because we determine A.R.S. § 25-214(C) is inapplicable, 

we deny the motion as moot.
AWB, et al. v. KELLIN

Decision of the Court

4

convey interests in real property. “The note is a contract that evidences the 

loan and the obligor’s duty to repay.” Id. “The trust deed transfers an 

interest in real property, securing the repayment of the money owed under 

the note.” Id. See A.R.S. §§ 33-801(4), -801(8), -801(9), -805, -807(A).

¶11 Because none of the statutory exceptions apply, the notes 

Kellin executed necessarily fall under the general principle that “[e]ither 

spouse separately may . . . bind the community[.]” A.R.S. § 25-214(C). In 

fact, “[i]t is well settled in this State that execution of a note by the husband, 

in the absence of any evidence that the obligation was not a community one, 

binds the community composed of the husband and wife.” Bainum v. 

Roundy, 21 Ariz. App. 534, 536 (1974) (citation omitted). Kellin

acknowledges the presumption that a debt assumed by one spouse during 

a marriage is a community debt. However, aside from his arguments under 

A.R.S. § 25-214, which we find unpersuasive, Kellin does not argue why 

that presumption does not apply here.

¶12 Kellin admits the deficiency judgment at issue here arises 

from the promissory notes he signed while married to Wife. AWB sued 

Kellin on the promissory notes after AWB had foreclosed on the deeds of 

trust. The foreclosure in Utah extinguished the deeds of trust, and a 

deficiency remained under the promissory notes. The satisfaction of the 

resulting deficiency judgment, separate from the deeds of trust, is what the 

superior court ordered when it issued the writ of execution for the sale of a 

community asset, the Carefree Property. The notes Kellin signed 

documented a transaction in which he borrowed money and promised to 

repay it. Because the notes did not constitute a transaction for the 

acquisition, disposition or encumbrance of an interest in real property, and 

because he did not, by signing the notes, offer a guaranty, indemnity or 

suretyship, the protections of A.R.S. § 25-214(C) do not apply here. 

Therefore, we conclude the debt incurred by Kellin when he signed the 

promissory notes is enforceable against the community.

¶13 Having determined the debt is enforceable against the 

community, next we turn to the question of whether the superior court 

properly ruled that Banner may force the sale of the Carefree Property to 

apply the proceeds towards satisfaction of the judgment.

¶14 Kellin argues the superior court violated his due process 

rights by ruling transfers of the Carefree Property between Kellin, Wife, and 

SRK were fraudulent under A.R.S. §§ 44-1004(A)(1)-(2), and 44-1005. 

Constitutional challenges of due process violations are issues of law, which 

we review de novo. Mack v. Cruikshank, 196 Ariz. 541, 544, ¶ 6 (App. 1999).
AWB, et al. v. KELLIN

Decision of the Court

5

¶15 To satisfy the requirements under the Constitution, due 

process “at a minimum requires notice and an opportunity to be heard.”

Wohlstrom v. Buchanan, 180 Ariz. 389, 392 (1994) (citation omitted). A party 

must at least have “a chance to offer evidence and confront adverse 

witnesses.” Cruz v. Garcia, 240 Ariz. 233, 236, ¶ 11 (App. 2016). Kellin was 

afforded these rights before the superior court ruled finding the transfers 

fraudulent.

¶16 In Banner’s original motion for an issuance of a writ of special 

execution, Banner argued the transfers of the Carefree Property between 

Kellin, Wife, and SRK were fraudulent. Kellin was served with the motion 

and chose not to respond to the specific allegation of fraudulent transfers 

under §§ 44-1004(A)(1)-(2), and 44-1005. Due process requirements were 

satisfied when Kellin was put on notice of Banner’s claims and was given 

the opportunity to respond. Wohlstrom, 180 Ariz. at 392.

¶17 Kellin also argues the court’s order finding the transfers 

fraudulent is defective because Banner did not follow the proper procedure 

to avoid the transfers set forth under A.R.S. § 44-1007(A)(1), by first 

applying for a writ of garnishment. Whether the statute requires that a 

creditor seeking to satisfy its claim must first apply for a writ of 

garnishment is a question of law. We review de novo a superior court’s 

interpretation of a statute and its conclusions of law. Milner v. Colonial Tr. 

Co., 198 Ariz. 24, 26 (App. 2000). When the language of a statute is clear 

and unambiguous, a court should not look beyond the language, but rather 

“simply ‘apply it without using other means of construction,’ assuming that 

the legislature has said what it means.” Hughes v. Jorgenson, 203 Ariz. 71,

73, ¶ 11 (2002), quoting UNUM Life Ins. Co. v. Craig, 200 Ariz. 327, 330, ¶ 12 

(2001).

¶18 Section 44-1007(A)(1)-(2) states,

A. In an action for relief against a transfer or obligation under 

this article, a creditor, subject to the limitations in §§ 44-1008 

and 44-1009, may obtain one or more of the following 

remedies:

1. Garnishment against the fraudulent transferee or the 

recipient of the fraudulent obligation, in accordance with the 

procedure prescribed by law in obtaining such remedy.

2. Avoidance of the transfer or obligation to the extent 

necessary to satisfy the creditor’s claim.
AWB, et al. v. KELLIN

Decision of the Court

6

¶19 The language “may obtain one or more of the following 

remedies” is unambiguous. The creditor may choose to pursue one or 

several of the enumerated remedies. Nothing within the statute suggests a 

creditor must apply for a writ of garnishment before it may avail itself of 

the remedy of avoidance of the transfer. The superior court did not specify 

the section of A.R.S. § 44-1007(A)(1) under which it ruled, but stated, “the 

Bank is entitled under §§ 44-1007 and 12-1635 to avoid the transfers to the 

extent necessary to allow the issuance [sic] a special writ of execution 

against SRK for the foreclosure of the judgment lien heretofore recorded 

against the Carefree Property so that the Property may be sold and the 

proceeds applied to the Judgment.” (Emphasis added). Whether the 

superior court afforded Banner the option of any remedy under § 44-1007

or ruled under § 44-1007(A)(2), an interpretation strongly supported by the 

fact that the court’s ruling references the sale of the Carefree Property in 

satisfaction of the judgment, the court’s order declaring the transfers 

fraudulent is supported by the evidence in the record and the court’s 

findings of fact that the various transfers of title between and among Kellin, 

Wife, and SRK without reasonable equivalent of value evidenced 

fraudulent intent. As such, we affirm.

CONCLUSION

¶20 For the forgoing reasons, we affirm the superior court’s 

ruling. Kellin’s requests for fees and costs under A.R.S. §§ 12-341.01, -349, 

and -350 are denied. Pursuant to A.R.S. § 12-341.01, we award Banner its 

reasonable attorneys’ fees and costs on appeal, subject to compliance with 

ARCAP 21.