MISSOULA -- A scheduled sheriff's foreclosure sale affecting many of the Paws Up cattle and horse facilities was canceled Tuesday after the ranch's owners and its construction firm settled a potentially $2.1 million lien.
Paws Up officials declined to release the amount of the settlement between Dick Anderson Construction and the ranch's Monroe Property Co.
A news release on Tuesday declared "the dispute has been resolved satisfactorily to both parties." It added, "The Resort at Paws Up which is operated at the ranch location for many years has not been part of the dispute."
Dick Anderson Construction won its case against Paws Up owner David Lipson's Monroe Property Co. in the Montana Supreme Court last June. That cleared the way to sell about 480 acres of the ranch on Thursday, including the parcels where its equestrian training arena and cattle ranch operations are located.
The ranch and resort own 37,000 acres along the Blackfoot River between Lubrecht Experimental Forest and Clearwater Junction, according to the Resort at Paws Up website.
The construction firm sued in 2001, claiming Lipson failed to pay about $800,000 in cost overruns on a $10 million contract for buildings, roads and other features on Lipson's property.
The high court found Lipson had used an "asset-free shell entity" to deal with the construction firm as a way to protect his property from construction liens. But the justices concluded that, because Lipson "directed 41 changes or additions to the plumbing and 113 pages of changes to the work done on the equestrian center," he was responsible for cost overruns regardless of the "complicated structure" of his dealings.
"They (Lipson's representatives) admitted in the district court proceedings that one of the reasons for the structure was to make it judgment-proof and to protect the Paws Up land itself from liens," the justices wrote.
That would leave Montana's construction lien laws unenforceable if allowed to stand.
Over the years of court maneuverings, interest and attorney's fees boosted the judgment to $2,127,993.89 as of November, according to the Missoula County Sheriff's Office civil department.
Staff at Dick Anderson Construction said they could not comment on the foreclosure sale.
"But it looks as if the debtor and creditor have worked out an agreement," Deputy Missoula County Attorney Marnie McClain said on Tuesday. "I expect, if they complete the work they've been doing over the last couple days, we'll cancel the sale."
Missoula County does not have any role in the foreclosure or the settlement, McClain said, other than providing the courthouse steps for the sheriff's sale.