Meghan owned a machine shop. It had one slightly buckled wall. It had been built years prior to Town's adoption of a zoning ordinance that permits office buildings and retail stores, but not manufacturing facilities.

Harry purchased the machine shop from Meghan for $500,000. He gave her $50,000 in cash and a promissory note for an additional $50,000 secured by a deed of trust. Then, he borrowed the other $400,000 from Royal Bank (Royal), which recorded a mortgage. Royal was aware of Meghan's promissory note and deed of trust prior to the close of escrow. Assume Meghan does not know where/how Harry obtained the $400,000, but only that the money was deposited into her account.

Kate owns a parcel adjoining Harry's machine shop. She recently began excavation for construction of an office building. Harry complained to Kate that the excavation was causing the shop's wall to buckle further, but she did nothing in response.

Shortly thereafter, Harry's machine shop collapsed. Harry applied to Town for a building permit to rebuild the shop, but Town refused. He then defaulted on his obligations to Meghan and Royal.

Royal has filed a foreclosure suit against Harry, and Meghan has demanded a proportionate share of the proceeds from any foreclosure sale.

How is the court likely to rule on Meghan's claim for a proportionate share of the proceeds from any foreclosure sale? Discuss.