“Finders Keepers Losers Weepers?” - Real Estate Tales from the Courtroom

A buyer purchased a Paradise Valley home “as is” and while remodeling, $500,000 was found hidden in the walls. Who owns the money – the buyer, the seller, or the contractor that found the money? The Arizona Court of the Appeals was asked to answer this question.   

 The Facts:

The seller’s father lived in the home until he passed away and his daughter (the “seller”) was the personal representative of his estate. The seller knew from experience that her father had hidden gold, cash, and other valuables in unusual places in other homes. Over the course of seven years, the seller found stocks and bonds, as well as hundreds of military-style green ammunition cans hidden throughout the house, some of which contained gold or cash.

Seven years after her father’s death, the seller sold the home “as is” to the buyers. The buyers hired a contractor to remodel the home. Shortly after construction began, an employee of the contractor discovered two ammunition cans full of cash in the kitchen wall behind a wall mounted toaster oven, and two more cash-filled ammo cans inside the framing of an upstairs bathroom. The contractor did not disclose the found money to the buyers right away and hid the money. Eventually, the contractor told the buyers about the discovery and the police ultimately took control of the $500,000.   

The buyers sued the contractor for the money, the contractor filed a counterclaim for the money, and the seller filed a petition in probate court on behalf of the estate to recover the money. The two cases were consolidated.   The trial court ruled that the money belonged to the seller and the buyer appealed, arguing that the money was abandoned when the home was sold “as is.”  

 The Court’s Decision

The Court of Appeals stated that although school children like to say “finders keepers” a finder’s rights depend on how a court classifies the found property. Found property can be classified as: 

 

·         Mislaid: the owner intentionally places it in a certain place and later forgets about it.

·         Lost: the owner unintentionally parts with it through either carelessness or neglect.

·         Abandoned: it is thrown away or voluntarily and intentionally forsaken by its owner.   

·         Treasure trove: it is verifiably antiquated and concealed for so long that the owner is probably dead or unknown. 

Generally, a finder of lost, abandoned, or treasure trove property acquires a right to possess the property against the entire world, except the rightful owner.  A finder of mislaid property must turn the property over to the owner of the premises where the property was found and has a duty to safeguard the property for the true owner.

The Court quoted an American Law Reports article “Title to Unknown Valuables Secreted in Articles Sold”:

 

Where both buyer and seller were ignorant of the existence or presence of the concealed valuable, and the contract was not broad enough to indicate an intent to convey all the contents, known or unknown, the courts have generally held that as between the owner and purchaser, title to the hidden article did not pass by the sale.

 

Further, the Court noted that money is rarely, if ever, abandoned.  As a result, the Court of Appeals agreed with the trial court, found that the money was mislaid, and therefore, the money belonged to the seller. 

Case Lessons:

• “Finders” are not always “keepers” – even in an “as is” contract. 
• “Losers” are not always “weepers” – regardless of what the kids say.
• If you hide money in your home – make sure your Personal Representative knows where to find it. 

 

Spann v. Jennings, 229 Ariz. 584, 278 P.3d 1287 (App. 2012)

 

K. Michelle Lind, Esq. is an attorney who currently serves Of Counsel to the Arizona REALTORS®.  She is also the author of the book - Arizona Real Estate: A Professional's Guide to Law and Practice (3rd Ed.) .  Watch for the Fourth Edition, which should be available soon. 

 For more real estate related articles, visit Michelle’s Blog at Arizona Real Estate – A Professional’s Guide to Law & Practice. (arizonarealestateprofessionalguide.blogspot.com)

This article is of a general nature and may not be updated or revised for accuracy as statutory or case law changes following the date of first publication. Further, this article reflects only the opinion of the author, is not intended as definitive legal advice and you should not act upon it without seeking independent legal counsel.  7/5/23