1
EXHIBIT 5.1
July 2, 2001
Meritage Corporation
6613 North Scottsdale Road, Suite 200
Scottsdale, Arizona 85250
Monterey Homes Arizona, Inc.
Meritage Paseo Crossing, LLC
Monterey Homes Construction, Inc.
Meritage Paseo Construction, LLC
Meritage Homes of Arizona, Inc.
Meritage Homes Construction, Inc.
MTH-Texas GP, Inc.
MTH-Texas LP, Inc.
Legacy/Monterey Homes, LP
Meritage Homes of Northern California, Inc.
Hancock-MTH Builders, Inc.
Hancock-MTH Communities, Inc
Legacy Operating Company, L.P.
each c/o Meritage Corporation
6613 North Scottsdale Road, Suite 200
Scottsdale, Arizona 85250
Ladies and Gentlemen:
Reference is made to the Registration Statement on Form S-4, including
amendments and exhibits thereto (the "Registration Statement"), for the proposed
offer to exchange (the "Exchange Offer") by Meritage Corporation (the "Company")
and Monterey Homes Arizona, Inc., Meritage Paseo Crossing, LLC, Monterey Homes
Construction, Inc., Meritage Paseo Construction, LLC, Meritage Homes of Arizona,
Inc., Meritage Homes Construction, Inc., MTH-Texas GP, Inc., MTH-Texas LP, Inc.,
Legacy/Monterey Homes L.P., Meritage Homes of Northern California, Inc.,
Hancock-MTH Builders, Inc., Legacy Operating Company, L.P. and Hancock-MTH
Communities, Inc (collectively, the "Guarantors"), of up to an aggregate of $165
million in principal amount of its 9.75% Senior Notes due 2011 (the "Exchange
Notes") for an equal principal amount of its outstanding 9.75 Senior Notes due
2011 (the "Outstanding Notes") and the guarantees by the Guarantors of the
Exchange Notes. The Outstanding Notes were issued, and the Exchanges Notes are
issuable, pursuant to an Indenture, dated May 30, 2001, by and among the
Company, the Guarantors and Wells Fargo Bank, National Association, as Trustee
(the "Indenture").
Based on the foregoing, and subject to the qualifications and
limitations set forth herein, we advise you that:
2
1. The Exchange Notes, when issued, authenticated and delivered
by the Company and the Trustee in accordance with the terms of the Indenture,
and when issued in exchange for Outstanding Notes as contemplated in the
Registration Statement, will be legally binding and valid obligations of the
Company, entitled to the benefits of the Indenture and enforceable against the
Company in accordance with their terms.
2. The guarantees by the Guarantors to be endorsed on the
Exchange Notes, when the Exchange Notes are issued, authenticated and delivered
by the Company and the Trustee in accordance with the terms of the Indenture,
and when issued as contemplated in the Registration Statement, will be legally
binding and valid obligations of the Guarantors enforceable against each of them
in accordance with their terms.
In rendering this opinion, we have reviewed and relied upon the
Indenture, the Outstanding Notes, the form of Exchange Notes and such documents,
records, and other instruments of the Company and the Guarantors as we have
deemed necessary.
The opinions set forth above are subject to the following
qualifications:
(i) The opinions are subject to and may be limited by (a)
applicable bankruptcy, insolvency, liquidation, fraudulent conveyance or
transfer, moratorium, reorganization, or other similar laws affecting creditors'
rights generally; (b) general equitable principles and rules of law governing
specific performance, estoppel, waiver, injunctive relief, and other equitable
remedies (regardless of whether enforcement is sought in a proceeding at law or
in equity), and the discretion of any court before which a proceeding may be
brought; (c) duties and standards of good faith, reasonableness and fair dealing
imposed on creditors and parties to contracts; (d) the limitation in certain
circumstances of provisions imposing liquidated damages, penalties, forfeitures,
late payment charges or increases in interest rates upon delinquency in payment
or the occurrence of a default; and (e) a court determination that any fees
payable pursuant to a provision requiring the payment of attorneys' fees is
reasonable. Further, we express no opinion regarding the enforceability of
Section 4.03 of the Indenture.
(ii) We express no opinion with respect to the validity and
enforceability of indemnification or contribution provisions to the extent they
purport to provide indemnity against (or contribution in respect of) any
violation by the indemnified party of any state or federal securities laws or
regulations, or against the gross negligence, willful misconduct, or illegal
acts of the indemnified party, or release such party from the consequences
thereof, or with respect to provisions purporting to waive access to legal or
equitable remedies or defenses (including proper jurisdiction, venue and forum
non conveniens).
(iii) We have assumed: (a) the genuineness of the signatures
and the authenticity of documents submitted to us as originals, and the
conformity to originals of all documents submitted to us as certified or
photostatic copies; (b) that such documents accurately describe the mutual
understanding of the parties as to all matters contained therein and that no
other agreements or undertakings exist between the parties that would affect the
documents relating to the transactions contemplated by such documents and
agreements; (c) the due authorization, execution, and delivery of the documents
discussed herein by all parties thereto except the Company and the Guarantors,
that such documents will be valid and binding upon, and enforceable in
3
accordance with their terms against, all parties thereto except the Company and
the Guarantors, and that the execution, delivery, and performance of such
documents by parties other than the Company and the Guarantors will not violate
any provision of any charter document, law, rule, regulation, judgment, order,
decree, agreement or other document binding upon or applicable to such other
parties or their respective assets; (d) the accuracy, completeness, and
genuineness of all representations and certifications made to or obtained by us,
including those of public officials; (e) the accuracy and completeness of
records of the Company and the Guarantors; and (f) that no fraud or dishonesty
exists with respect to any matters relevant to our opinions.
(iv) We express no opinion regarding compliance by the Company
or any Guarantor with any financial covenants required to be maintained by them
under any agreement or document, or as to the financial ability of the Company
or any Guarantors to meet its obligations under the documents described herein.
(v) Except as otherwise provided herein, the opinions herein
are limited solely to the laws of the State of Arizona and the laws of the
United States of America which are, in our experience, normally applicable to
transactions of the type contemplated by the note documents, including the
issuance and sale of the Outstanding Notes and the Exchange Notes. Because
certain of the documents referred to herein are governed by New York and other
laws, we have assumed, without investigation, that the laws of the State of New
York or such other jurisdictions are the same as the laws of the State of
Arizona. We express no opinion on the law of any other jurisdiction or
principles of conflicts of law and can assume no responsibility for the
applicability or effect of any such laws or principles. Further, we express no
opinion as to compliance with statutes and ordinances, the administrative
decisions, and the rules and regulations of counties, towns, municipalities and
special political subdivisions (whether created or enabled through legislative
action at the federal, state or regional level), and judicial decisions to the
extent that they deal with any of the foregoing, or as to compliance with any
fiduciary duties, whether arising under state or federal laws.
(vi) This opinion letter is limited to the matters stated
herein and no opinion is implied or may be inferred beyond the matters expressly
stated. Without limiting the foregoing, the opinions expressed in this letter
are based upon the law and facts as we understand them in effect on the date
hereof, and we assume no obligation to revise or supplement this opinion should
such law be changed by legislative action, judicial decision, or otherwise, or
should any facts or other matters upon which we have relied be changed.
We hereby consent to the filing of the opinion as an exhibit to the
Registration Statement and to the use of our name in the Registration Statement.
Very truly yours,
/s/ Snell & Wilmer L.L.P.