Arizona Supreme Court Addresses “Squatter’s Rights” and
Adverse Possession Regarding City Lots
By: David Korn, Esq.
Provident Law®
The Arizona Supreme Court recently ruled in the matter of Est. of Dominguez v. Dominguez that Arizona law allows squatters to adversely possess “lots” using a forged deed.[1] Indeed, per the Supreme Court’s recent ruling, if a lot is situated within a city or town, the adverse possessor can gain title by adverse possession if they claim ownership, using a recorded deed, and they pay the lot’s property taxes for five (5) consecutive years.
An action to recover a lot located in a city or town from a person having a recorded deed therefor, who claims ownership and has paid the taxes thereon, shall be brought within five years after the cause of action accrues, and not afterward, provided that the person against whom the action is brought, by himself or his grantors, has claimed ownership thereof and has paid the taxes thereon for at least five consecutive years next preceding the commencement of such action.
A.R.S. § 12-524. The term “lot” is not defined by the statute but includes the common meaning of real property.
The Court was by no means pleased by its decision. It expressed its concern that § 12-524 provides a blueprint for unscrupulous actors to swindle a vulnerable person’s property title through forgery.[2] Victims who entrust management of their financial affairs and property to a third party are especially at risk, as wrongdoers could forge and record a deed to the victim’s property. The fraudster could then get title by adverse possession after paying the property’s taxes for five years, perhaps with the victims’ own funds. This threat is especially prevalent considering Arizona’s sizable population of vulnerable elderly citizens.[3]
“The legislature explicitly intended a “recorded deed” to mean any facially
valid deed recorded with the county recorder, including forged deeds.”
The reasoning behind A.R.S. § 12-524 is lost to history. The statutory anachronism was added to Arizona’s 1901 Territorial Code over 100 years ago, and there is no legislative history explaining its enactment.[4] Presumably, the Arizona legislature enacted A.R.S. § 12-524 to ensure property taxes were paid. It also provided an easy way to clear title to city and town lots, thereby encouraging investment, development and growth without the burden of extensive litigation over title. Regardless of the rationale behind the statute, the legislature explicitly intended a “recorded deed” to mean any facially valid deed recorded with the county recorder, including forged deeds. Arizona courts cannot rewrite laws, even if they open the door to fraud.[5] Thus, the Arizona Supreme Court’s hands are tied. From all appearances, it is now open season on Arizona real estate.
HOW TO PROTECT YOUR PROPERTY
Provident Law® has developed a solution to Dominguez: the traditional understanding of Arizona’s adverse possession laws is wrong. Contrary to Arizona case law, title by adverse possession is not superior to all other claims. Fraudsters cannot steal property merely because they evaded discovery for five years. Rather, title by adverse possession becomes free and clear title, only after the statute of limitations to challenge the adverse title elapses.
Because adverse possession is established by statute rather than common law, the law’s text, not past judicial interpretation, dictates its application. The courts have misinterpreted Arizona’s adverse possession statutes because they assume the term “the cause of action” in A.R.S. §§ 12-522–526 refers to quiet title against adverse possession. Thus, the courts have necessarily assumed title by adverse possession is immediately free and clear title. This cannot be, because, as reiterated in Dominguez, courts cannot interpret statutes to render them superfluous.[6] The traditional understanding of adverse possession in Arizona renders A.R.S. §§ 12-522-523 not just superfluous, but totally ineffective. Therefore, “the cause of action” must refer to two different causes of action, trespass and adverse possession. This important distinction protects vulnerable Arizonans from forged deeds.
Compare Arizona’s adverse possession statutes.
A.R.S. §§ 12-522, 526 and A.R.S. §§ 12-523, 524 refer to the same type of possession, respectively. A.R.S. §§ 12-522 and 526 refer to title obtained by adverse possession after 10 years of possession, while A.R.S. §§ 12-523 and 524 refer to title obtained by adverse possession, under title or color of title, after 5 years of possession. Despite purportedly referring to the same types of possession, the statutes establish different statutes of limitations, 2 and 10, or 3 and 5. Title by adverse possession by right of possession cannot have a 10- and 2-year statute of limitations, nor can title by adverse possession under color of title have a 5- and 3-year statute of limitations. Therefore, because the courts cannot interpret statutes to render others superfluous, “the cause of action” referred to in A.R.S. §§ 12-524, 526, what has been traditionally understood to be Arizona’s adverse possession statutes, must refer to trespass, not quiet title by adverse possession.
This means that even if a fraudster gains title by adverse possession, when the fraudster asserts their ownership interest in court, the true owner still has three years, upon receipt of notice, to defend and prove they have free and clear title. Arizona’s adverse possession statutes have not secretly contained a vehicle for fraud, for over 100 years, that has merely remained undiscovered until now. Rather, the drafters intentionally included a mechanism to protect victims from predatory adverse possessors. Thus, when a fraudster adversely possesses grandma’s home, hope is not lost. A.R.S. §§ 12-522-523 should serve to protect them, and it is up to Arizona’s real estate attorneys to help assert their legal rights.
If you or someone you know needs legal advice or representation concerning a real estate dispute, the real estate attorney’s at Provident Law® are ready to help. Call, email, or visit us online today to schedule a consultation.
[1]Est. of Dominguez v. Dominguez, No. CV-24-0102-PR, 2025 Ariz. LEXIS 141, at *2 (Apr. 16, 2025).
[2] Id. at *28.
[3] Id. (citing Estate of McGill v. Albrecht, 203 Ariz. 525, 528 (2002) (“Arizona has a substantial population of elderly people)
[4] Id. at *18.
[5] Id. at *27-28 (The Courts cannot rewrite “a statute under the guise of interpreting it to prevent a perceived injustice.”)
[6] Est. of Dominguez v. Dominguez, No. CV-24-0102-PR, 2025 Ariz. LEXIS 141, at *10 (Apr. 16, 2025) (citing Nicaise v. Sundaram, 245 Ariz. 566, 568, 432 P.3d 925 ¶ 11 (2019) (“A cardinal principle of statutory interpretation is to give meaning, if possible, to every word and provision so that no word or provision is rendered superfluous.”)).
action” referred to in A.R.S. §§ 12-524, 526, what has been traditionally understood to be Arizona’s adverse possession statutes, must refer to trespass, not quiet title by adverse possession.
This means that even if a fraudster gains title by adverse possession, when the fraudster asserts their ownership interest in court, the true owner still has three years, upon receipt of notice, to defend and prove they have free and clear title. Arizona’s adverse possession statutes have not secretly contained a vehicle for fraud, for over 100 years, that has merely remained undiscovered until now. Rather, the drafters intentionally included a mechanism to protect victims from predatory adverse possessors. Thus, when a fraudster adversely possesses grandma’s home, hope is not lost. A.R.S. §§ 12-522-523 should serve to protect them, and it is up to Arizona’s real estate attorneys to help assert their legal rights.
If you or someone you know needs legal advice or representation concerning a real estate dispute, the real estate attorney’s at Provident Law® are ready to help. Call, email, or visit us online today to schedule a consultation.