Williams v. Ketchikan Gateway Borough

[PROPERTY LAW]


In Williams v. Ketchikan Gateway Borough,[1] the supreme court held that a taxpayer who receives a grant to rebuild a house and, subsequently executes a Deed of Trust (DOT), remains the property owner and, thus, is not exempt from paying property tax.[2] Williams received a grant to rebuild his house from the U.S. Government, which required Williams to repay the full amount if he sold the property within the next ten years.[3] He then executed a DOT in which he promised to repay the grant.[4] On appeal, Williams argued that executing the DOT transferred property ownership to the U.S. Government and therefore exempted him from paying property tax.[5] The supreme court affirmed the lower court’s decision, reasoning that a DOT’s execution creates a security interest and that the DOT explicitly stated that Williams was responsible for paying the secured property’s taxes.[6] Accordingly, the DOT execution did not divest Williams of his ownership interest in either the real property or the house rebuilt upon it.[7] Affirming the lower court’s decision, the supreme court held that a taxpayer who executes a DOT remains subject to property taxes as the property’s owner.[8]


[1] 295 P.3d 374 (Alaska 2013).

[2] Id. at 375.

[3] Id. at 374.

[4] Id.

[5] Id. at 375.

[6] Id. at 379.

[7] Id.

[8] Id. at 375.

Williams v. Ketchikan Gateway Borough

[PROPERTY LAW]


In Williams v. Ketchikan Gateway Borough,[1] the supreme court held that a taxpayer who receives a grant to rebuild a house and, subsequently executes a Deed of Trust (DOT), remains the property owner and, thus, is not exempt from paying property tax.[2] Williams received a grant to rebuild his house from the U.S. Government, which required Williams to repay the full amount if he sold the property within the next ten years.[3] He then executed a DOT in which he promised to repay the grant.[4] On appeal, Williams argued that executing the DOT transferred property ownership to the U.S. Government and therefore exempted him from paying property tax.[5] The supreme court affirmed the lower court’s decision, reasoning that a DOT’s execution creates a security interest and that the DOT explicitly stated that Williams was responsible for paying the secured property’s taxes.[6] Accordingly, the DOT execution did not divest Williams of his ownership interest in either the real property or the house rebuilt upon it.[7] Affirming the lower court’s decision, the supreme court held that a taxpayer who executes a DOT remains subject to property taxes as the property’s owner.[8]


[1] 295 P.3d 374 (Alaska 2013).

[2] Id. at 375.

[3] Id. at 374.

[4] Id.

[5] Id. at 375.

[6] Id. at 379.

[7] Id.

[8] Id. at 375.