## Facts

- ATS, Inc. obtained a money judgment against Keith Canfield and properly recorded the judgment, creating a lien on Canfield’s real property in the county where recorded.
- A few months later, Canfield sold a portion of the encumbered land to James Kent.
- To finance the purchase, Kent executed a purchase-money deed of trust in favor of Union Planters National Bank (acting through trustees) as part of the same transaction in which Kent received Canfield’s deed.
- Kent’s deed and Union Planters’ deed of trust were recorded shortly after the closing.
- ATS filed suit against Kent and Union Planters seeking to establish the priority of ATS’s judgment lien and to enforce the lien against the real property.
- The trial court declined to order a sale of the property and instead entered a money judgment for ATS against Kent and Union Planters for $15,674.75, representing the amount Canfield received from the sale after payment of prior debts.
- ATS appealed, arguing that its recorded judgment lien remained attached to the land and that it was entitled to enforce that lien by sale of the property.

## Issues

1. Whether a judgment lien that attached to the seller’s real property before conveyance is extinguished or subordinated by a later conveyance to a purchaser who contemporaneously grants a purchase-money deed of trust to a lender.
2. Whether the judgment creditor is entitled to enforce the judgment lien against the land by judicial sale, rather than being limited to a substituted money judgment tied to the seller’s net sale proceeds.

## Decision

- The Tennessee Court of Appeals held that ATS’s judgment lien, having attached to the property while Canfield owned it, was not destroyed by Canfield’s later conveyance to Kent.
- The court concluded that Union Planters’ purchase-money deed of trust was subordinate to ATS’s previously recorded judgment lien under these facts.
- The court ruled that the trial court erred by refusing to allow enforcement of ATS’s lien against the property and by substituting a money judgment against Kent and Union Planters based on the amount Canfield received at closing.
- The judgment was reversed and the case remanded for proceedings consistent with recognizing ATS’s lien priority and permitting enforcement against the real property.

## Legal Principles

- A properly recorded judgment becomes a lien on the judgment debtor’s real property and generally continues to encumber the property after it is conveyed to a third party.
- A purchaser takes title subject to recorded liens that attached to the property before the conveyance.
- A purchase-money deed of trust given by a buyer does not defeat a preexisting judgment lien that had already attached to the seller’s property interest before the sale.
- When a judgment lien remains valid and enforcement is timely sought, the ordinary remedy is enforcement against the land (including sale), and a court should not replace that in rem remedy with a limited personal money judgment that effectively alters lien priority.

## Conclusion

ATS, Inc. v. Kent holds that a judgment lien recorded against a seller’s property before sale remains attached to the land after conveyance and is superior to the buyer’s later purchase-money deed of trust; the judgment creditor may enforce the lien by a sale of the property rather than being confined to a money judgment measured by the seller’s net sale proceeds.


ATS, Inc. v. Kent, 27 S.W.3d 923 (1998)