The sun has to be in the right place in the sky at the right time of year. The cirrus clouds have to be at the right altitude, and the ice crystals that make up those clouds must be in the right shape. These are the basic circumstances necessary to create a Circumhorizontal Arc.
After I saw my first one from the backyard of our new house in June of 2008 (I posted the vid of the event on YouTube, here: http://www.youtube.com/user/melissaconwaywrites#p/a/f/0/npL9n1UsR0E), and after I found out what it WAS, and that it was a rare phenomenon, I felt privileged to have witnessed it. After I saw the second one exactly a year later, and then a THIRD a few days after that, I was flabbergasted. Thrice in one lifetime? How can that be? Add to that the many, many Sun Dogs and Sun Halos (and moon Halos!) Iridescent Clouds and Coronas I've seen and photographed, and you can imagine I started thinking that my backyard was a very special place on this earth.
Today, to my astonishment, I saw and photographed another Circumhorizontal Arc.
By the way, the best site I've found to date on these kinds of sky phenomenon is Atmospheric Optics, here: http://www.atoptics.co.uk/. If you are at all interested in this sort of thing, this really cool site answers all your questions and more.