Which of the following is true regarding the establishment of a public purpose?
A)A narrow interpretation is given to the term
B)There must be a public road, park, school or other facility involved
C)Private property cannot be affected
D)None of the above
Question 2
Homeowner A closed on his property (a two-acre lot) on May 30, 2012. First Federal (FF) financed the purchase and recorded a mortgage on the lot on that same day. Unbeknownst to A and FF, Forest Excavators (FE) had removed two trees from the property and had several pieces of equipment stored on the property. A had contracted with FE for the clearing of the lot so that he could begin construction. FE filed a lien on April 15, 2013, five days after it completed its clearing work. A defaults on his mortgage on May 1, 2013. At the time of default, he owes 229,000. FE is also owed 7,500. Sale of the lot brings 200,000. How will the 200,000 be distributed?
A) The 200,000 goes to FF because its mortgage was recorded before FE's lien
B) The 200,000 goes to FF because mortgages take priority over mechanic's liens
C) 7,500 goes to FE with the remainder to FF
D) Because FE began construction before the lot transaction closed, it can collect nothing
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