Chief Justice DURRANT, opinion of the Court:

Introduction

¶ 1 Appellant VCS, Inc. provided labor and materials to improve real property located in the Acord Meadows planned unit development in Salt Lake City. The developer, Acord Meadows, LLC (Acord), secured funding for the project from two lenders—America West Bank (America West) and Utah Funding Commercial, Inc. (Utah Funding). America West and Utah Funding each made several loans to Acord and secured those loans with trust deeds to the development properties. The lenders also entered into several subordination agreements among themselves that altered the priority arrangement of their trust deeds.

¶ 2 VCS was never paid for its work, so it filed a mechanic's lien covering several lots of the development. Four of those lots were later sold through a foreclosure sale after Acord defaulted on its loans from Utah Funding. After the sale, VCS claimed that it was entitled to payment of its mechanic's lien, despite the foreclosure, because its lien had priority over Utah Funding's liens. The district court disagreed and ruled that VCS's mechanic's lien was extinguished by the foreclosure of Utah Funding's liens.

¶ 3 VCS's appeal presents us with an issue of first impression in Utah—namely, where there are three or more creditors who hold an interest in the same collateral, what is the effect of a subordination agreement between fewer than all of the creditors? Courts have taken two approaches to this issue. Under the majority approach, called partial subordination, the parties to the subordination agreement simply swap places in the priority chain, leaving the nonparty creditor unaffected. In contrast, under the minority approach, called complete subordination, the subordinating creditor drops to the bottom of the priority chain and the nonparty creditor steps into first priority position.

¶ 4 We adopt the partial subordination approach because it better reflects the intentions of parties to subordination agreements. And in applying that approach to this case, we conclude that VCS's mechanic's lien remained junior to one of Utah Funding's liens, so the mechanic's lien was extinguished once Utah Funding's lien was foreclosed upon. On this basis we affirm the district court's ruling.

Background

I. Events Leading Up to the Present Dispute

¶ 5 The facts of this case center on fourteen parcels of real property located in Salt Lake City in the Acord Meadows planned unit development (Acord Meadows PUD). In May 2005, several buyers obtained title to lots one through fourteen of the Acord Meadows PUD.1 Near the end of 2005, the buyers conveyed the properties to Acord Meadows, LLC (Acord). To fund the purchase, Acord granted America West a $540,000 trust deed (America West Trust Deed 1) and granted Utah Funding a $152,000 trust deed (Utah Funding Trust Deed 1).2 Both trust deeds were entered into on December 28, 2005, and recorded on December 30, 2005.

¶ 6 Shortly after America West and Utah Funding recorded their trust deeds, VCS, Inc. (VCS) performed work on lots one through six and lot fourteen.3 It did so under a previously negotiated contract between it, Acord, Lind Enterprises, Inc., and L. Kyle Lind. VCS was never paid for its work.

¶ 7 In May 2006, Acord granted America West another trust deed, this time for $425,000 (America West Trust Deed 2). America West recorded the deed on May 25, 2006. In connection with the new trust deed, America West required that Utah Funding agree to subordinate Utah Funding Trust Deed 1 to America West Trust Deed 2. The parties executed a subordination agreement, which was recorded on July 12, 2006 (Subordination Agreement 1).

¶ 8 Acord sought further funding from America West in October 2006. To secure an additional $751,233, Acord and America West agreed to modify the amount of America West Trust Deed 1 from $540,000 to $1,291,233 (Modified America Trust Deed 1). On the same day the parties modified the deed, America West executed a subordination agreement that made America West Trust Deed 2 subordinate to Modified America West Trust Deed 1 (Subordination Agreement 2).

¶ 9 Soon after receiving funds from America West, Acord sought further funding from Utah Funding. Acord granted Utah Funding a $100,000 trust deed (Utah Funding Trust Deed 2).4 Utah Funding recorded the deed on November 13, 2006.

¶ 10 As a final source of funding, Acord granted America West another trust deed, this time for $200,000, on August 7, 2007 (America West Trust Deed 3).5 This deed differed from the others in that it covered only lots one and two. America West required Utah Funding to subordinate both Utah Funding Trust Deed 1 and Utah Funding Trust Deed 2 to America West Trust Deed 3 (Subordination Agreements 3 and 4).

¶ 11 In September 2007, VCS filed notice of a mechanic's lien for work it performed on lots three through six for $127,335.91. And two months later, in November 2007, it filed notice of a mechanic's lien for work it performed on lots one and two for $98,000. VCS later amended each of those notices, in January 2008, by changing the date of the first labor and material to January 6, 2006.6 It also amended the amount owed on lots one and two to $29,876.98 and the amount owed on lots three through six to $175,907.20.

¶ 12 At some point during these events, America West's trust deeds were reconveyed and released. The parties have provided few specifics regarding when the deeds were released.7 But regardless, VCS has never challenged the assertion that America West's trust deeds were reconveyed and released, and even conceded the point below. So for purposes of this appeal, we acknowledge the parties' stipulation and assume that all of America West's trust deeds were reconveyed and released.

¶ 13 Acord later defaulted on both Utah Funding trust deeds. The trustee of each of the trust deeds issued a notice of default and election to sell for each. Only lots one through four were listed on the notices. The trustee held a sale under Utah Funding Trust Deed 2 on March 4, 2008. Huish Group, Keith Hamp, and Verla Hamp purchased that interest. VCS alleges that co-appellant Tom Phelps and several others made a bid for the property, but that the trustee refused to accept their bid.

¶ 14 In August 2008, about five months after the sale under Utah Funding Trust Deed 2, the trustee held a sale under Utah Funding Trust Deed 1. North Star Funding Group, Lind Enterprises, Inc., and Ms. Serre purchased that interest. They later conveyed the interest to L. Kyle Lind. Mr. Lind then conveyed lots one, three, and four to separate buyers. He conveyed lot one to Nathan Spencer. In connection with that conveyance, Mr. Spencer executed a trust deed in favor of Axiom Financial, LLC. Mr. Lind conveyed lot three to Nathan Van Rij and Sarah Van Rij. The Van Rijs executed a note in favor of Countrywide Home Loans, Inc. to pay for lot three. And finally, Mr. Lind conveyed lot four to Craig Belliston and Natasha Belliston. Each person who purchased from Mr. Lind was named as a third-party defendant by VCS and is an appellee in this appeal.8

II. Procedural History

¶ 15 Near the end of 2007, Acord commenced suit against VCS, alleging breach of contract, negligent misrepresentation, fraud, and estoppel. VCS answered the complaint and also made claims against third-party defendants Lind Enterprises, L. Kyle Lind, and Countrywide. VCS later amended its complaint to add Axiom Financial, LLC, Nathan Spencer, the Van Rijs, and the Bellistons as third-party defendants. VCS claimed, among other things, that its mechanic's lien had priority over the third-party defendants' interests in the Acord Meadows PUD.

¶ 16 Countrywide filed for summary judgment, which the district court granted. In its order the court explained,

The court later granted summary judgment in favor of the other third-party defendants on the same basis. VCS appealed the district court's rulings in favor of the third-party defendants. We have jurisdiction under Utah Code section 78A-3-102(j).

Standard of Review

¶ 17 In reviewing a district court's grant of summary judgment, "we view the facts and all reasonable inferences drawn therefrom in the light most favorable to the nonmoving party."9 But we review a "district court's legal conclusions and ultimate grant or denial of summary judgment" for correctness.10

Analysis

¶ 18 VCS asks us to reverse the district court's ruling for two reasons. First, it argues that the court erred as a matter of contract law by concluding that the subordination agreements were "null and void" once America West's liens were reconveyed and released. And second, it argues that, assuming that the subordination agreements were not "null and void," its mechanic's lien had priority over Utah Funding Trust Deed 1 because that deed lost its original priority position as a result of being subject to several subordination agreements. The district court did not reach VCS's second argument because it determined that there was no need to do so once it ruled against VCS on the first issue.

¶ 19 We affirm the district court's ruling, but do so on an alternative basis. Even were we to agree with VCS on the first issue (and so disagree with the district court), we would nonetheless affirm the district court's ruling because VCS's mechanic's lien was junior to Utah Funding Trust Deed 1, and so was extinguished when Utah Funding Trust Deed 1 was foreclosed upon.

¶ 20 In reaching that conclusion, we adopt the majority approach—termed "partial subordination"—to the issue of circular lien priorities, which arises where there are at least three creditors who hold an interest in the same property and fewer than all of those creditors enter into a subordination agreement. We do so because the partial subordination approach most accurately reflects the intentions of parties who enter into subordination agreements and it also prevents non-party creditors, such as VCS, from obtaining a windfall. Applying that approach to this case, we conclude that Utah Funding Trust Deed 1 had priority over VCS's mechanic's lien. Because we resolve the case in this manner, we have no need to decide whether the district court correctly decided that the subordination agreements were "null and void" once America West's liens were reconveyed and released.

¶ 21 VCS's final argument is that Utah Funding (and its assignees) received more money from the foreclosure sale than they were entitled to. We decline to address the merits of this argument, however, because it is unpreserved.

I. Under the Partial Subordination Approach, Utah Funding Trust Deed 1 had Priority Over VCS's Mechanic's Lien

¶ 22 VCS argues that the subordination agreements entered into by Utah Funding rearranged the priority chain and resulted in VCS's mechanic's lien having priority over Utah Funding Trust Deed 1. In making this argument, VCS asks us to adopt a minority approach to the issue of circular lien priorities called "complete subordination." But we decline to do so and instead adopt the majority approach, which is called "partial subordination." Under that approach, Utah Funding Trust Deed 1 retained priority over VCS's mechanic's lien even though it was subject to several subordination agreements.

¶ 23 The issue of circular lien priorities is an issue of first impression in Utah. Described simply, this issue arises where three or more creditors hold an interest in the same collateral and fewer than all of the creditors enter into a subordination agreement. The resulting question is what effect the subordination agreement has on the non-party creditors.11

¶ 24 Here, the issue arises because America West, Utah Funding, and VCS each held an interest in the Acord Meadows PUD. America West and Utah Funding entered into four different subordination agreements that purported to alter the priority among their respective interests. VCS is not a party to any of these agreements. The following chart describes the effect of each subordination agreement:

      Agreement                         Effect

    Subordination         Subordinated Utah Funding Trust Deed 1
    Agreement 1           to America West Trust Deed 2

    Subordination         Subordinated America West Trust Deed 2
    Agreement 2           to Modified America West Trust Deed 1

    Subordination         Subordinated Utah Funding Trust Deed 1
    Agreement 3           to America West Trust Deed 3

    Subordination         Subordinated Utah Funding Trust Deed 2
    Agreement 4           to America West Trust Deed 3

We are primarily concerned with whether Utah Funding Trust Deed 1 had priority over VCS's mechanic's lien because each of the third-party defendants obtained title through the foreclosure on Utah Funding Trust Deed 1. VCS argues that although its mechanic's lien was originally junior to Utah Funding Trust Deed 1 because it was recorded later, it gained priority over Utah Funding Trust Deed 1 as a result of the various subordination agreements outlined above.

¶ 25 The partial subordination approach for addressing circular lien priorities holds that the nonparty creditor is unaffected by the subordination agreement and "simply swaps the priorities of the parties to the subordination agreement."12 The following hypothetical illustrates how this approach operates:

Partial subordination is the approach subscribed to by a majority of jurisdictions.14

¶ 26 The complete subordination approach reaches a different result under the same hypothetical. Under that approach, C remains junior to B even though A agrees to subordinate its interest to C's. So under the complete subordination approach, B moves into first priority position, then C, then A. A minority of jurisdictions have adopted this approach.15

¶ 27 But the cases applying the complete subordination approach offer little justification for doing so. One rationale is that the complete subordination approach more closely adheres to the dictionary definition of "subordination." As the Alabama Supreme Court explained, "[b]y definition, `subordination' contemplates a reduction in priority. Nothing in the definition contemplates raising a lower priority lienholder up to the position of the subordinating party."16 But this rationale is unpersuasive because the central question in cases of circular lien priorities is what the parties intended, not what the dictionary definition of "subordination" is in a vacuum.17

¶ 28 Another rationale for the complete subordination approach is that it prevents the nonparty creditor from being harmed. But this rationale is equally unpersuasive because it fails to recognize that the partial subordination approach offers nonparty creditors the same protection. As the hypothetical above illustrates, under partial subordination, C (the creditor gaining priority) only gains priority to the extent that A (the creditor who originally had priority) would have had priority.18 Explained differently, "[t]he `partial' in `partial subordination' denotes the fact that the parties to a subordination agreement swap places in the priority ladder only to the extent of the smaller of the swapping parties' loans."19

¶ 29 We decline to adopt the complete subordination approach because it conflicts with the well-established rule that the parties' intentions control a contract. As the Seventh Circuit explained, complete subordination "would benefit a nonparty to the subordination agreement ... and why would the parties to the subordination agreement, who did not include [the nonparty], want to do that?"20 We have made this same point in several contract-law cases involving third-party beneficiaries by observing that the "benefits conferred by contracts are presumed to flow exclusively to the parties who sign the contracts. A third party may claim a contract benefit only if the parties to the contract clearly express an intention to confer a separate and distinct benefit on the third party."21

¶ 30 The subordination agreements that affected Utah Funding's trust deeds evidence the intent to alter the priority arrangement of interests held by Utah Funding and America West, not VCS. Each of the agreements provides as follows: "[The applicable Utah Funding lien] is hereby made second and subordinate to the [applicable America West lien]." Nothing in that language suggests that the parties intended to benefit VCS. Applying complete subordination would "allow an intervening lienholder to obtain a windfall by becoming a senior lienholder through no action of [its] own."22

¶ 31 In this case, Utah Funding recorded Utah Funding Trust Deed 1 before the date VCS began performing work on the Acord Meadows PUD, which gave Utah Funding Trust Deed 1 priority.23 Under the partial subordination approach, that priority arrangement was unaffected by the subordination agreements between Utah Funding and America West. The subordination agreements affected the priority arrangement between America West and Utah Funding vis-à-vis each other. Neither party intended to allow VCS's mechanic's lien to jump ahead in the priority chain. For these reasons, we conclude that Utah Funding Trust Deed 1 had priority over VCS's mechanic's lien, and foreclosure on that trust deed extinguished VCS's mechanic's lien. On this basis we affirm the district court's ruling.

II. VCS Did Not Preserve Its Argument That Utah Funding Received More Money From the Foreclosure Sale Than It Was Entitled To

¶ 32 VCS next argues that Utah Funding Trust Deed 1's priority is limited to the original amount of its lien—$152,000. But we decline to address the merits of this argument because VCS failed to preserve it.24

¶ 33 As a general rule, we "will not consider an issue unless it has been preserved in the court below."25 And the question of whether a party has preserved an issue below "turns on whether the district court ha[d] an opportunity to rule on [the] issue."26

¶ 34 VCS did not argue below that Utah Funding Trust Deed 1's priority was limited to $152,000.27 Moreover, VCS has not established as a factual matter that the foreclosure sale on Utah Funding Trust Deed 1 netted proceeds in excess of $152,000, and, in fact, at oral argument counsel for VCS stated that the foreclosure sale did not "generate enough to satisfy the $152,000 trust deed." So, on the one hand, VCS argues that Utah Funding (and its assignees) received too much, but, on the other hand, it acknowledges that the foreclosure sale did not generate enough proceeds to satisfy Utah Funding Trust Deed 1. VCS's inconsistent argument is likely a product of the fact that there was no record developed below on the issue.

¶ 35 In short, because VCS never gave the district court an opportunity to rule on the issue of whether Utah Funding (and its assignees) received more than the value of Utah Funding Trust Deed 1 ($152,000), the argument is unpreserved.

Conclusion

¶ 36 We adopt the partial subordination approach to the issue of circular lien priorities. Under that approach, Utah Funding Trust Deed 1 retained priority over VCS's mechanic's lien. On that basis, we affirm the district court's ruling that foreclosure on Utah Funding Trust Deed 1 extinguished VCS's mechanic's lien.