Court hears arguments on mechanics liens

Wednesday, Sept. 14, 2005 | 11:22 a.m.

CARSON CITY -- An attorney for contractors and suppliers who were not paid when building the Resort at Summerlin in Las Vegas told the Nevada Supreme Court they should have first crack at the money from the sale of the bankrupt resort, now the JW Marriott.

But a lawyer for the firm that loaned $100 million for the construction of the hotel-casino says his client has priority in getting the loan repaid.

Shortly after being completed the resort filed for bankruptcy protection in November 2000. It was sold out at a bankruptcy court auction for $80 million, according to court briefs.

Michael Leavitt, the attorney representing 16 contractors and suppliers, told the court that the mechanics lien they filed takes priority over the deed of trust held by Wilmington Trust Company. The group filed mechanics liens seeking $4.6 million.

Richard Carlston, the lawyer representing Wilmington Trust, said that the lender lost $49 million on the loan. The court took the arguments under submission Tuesday in a case appealed from District Judge James Mahan, who ruled in favor of Wilmington Trust.

The court took the arguments under submission Tuesday in a case appealed from District Judge James Mahan who ruled in favor of Wilmington Trust.