CA Supreme Court Clarified Title vs Sale Perfection

Once again, the devil being in the details, the attempt to treat perfection of title and perfection of sale goes down in flames in an Unlawful Detainer action in California.

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Hat tip to Dan Edstrom

see UD and Duly Perfected Title – FOR PUBLICATION_JAD16-07

I like this case for a number of reasons. The first is that the self serving documents that the banks file in these fraudulent foreclosures are coming under much greater scrutiny — almost back to the way things were before the era of false claims of securitization enabling millions of homes to be sold to a “bidder” who was never the “creditor” or beneficiary under a deed of trust.

It has long been recognized that the unlawful detainer statutes are to be strictly construed and that relief not statutorily authorized may not be given due to the summary nature of the proceedings.
[Citation.] ….

The remedy of unlawful detainer is a summary proceeding to determine the right to possession of real property. Since it is purely statutory in nature, it is essential that a party seeking the remedy bring himself clearly within the statute. [Citation.]

(Baugh v. Consumers Associates, Limited (1966) 241 Cal.App.2d 672, 674-675.)

This case is also interesting because the CA Supreme Court ordered it to be published. The trial court had committed the same essential error as in millions of other proceedings by DEEMING the law to have been satisfied in the absence of proof and even in the presence of obvious proof to the contrary. “Deeming” is not the same as ruling and it obviously runs contrary to “blind justice.” “Deeming” means the judge has already made up his/her mind and is creating a ruling that conforms to the prejudgment of the case.

Contrary to the plain reading of the statute, the trial court erroneously concluded “… that

under California Civil Code section 2924h(c), title is deemed perfected as of 8 a.m. on the date of the sale because the trustee’s deed upon sale was recorded within 15 calendar days.” (Statement of Decision, italics added.)

In this case, the sale was perfected at the time the three-day notice was served, but not the title. Thus, the plaintiff could not provide defendant with a valid three-day notice. The court below mixed the issues of sale and title, but perfecting title is not interchangeable with perfection of the sale under this statutory scheme.

Unless and until the Plaintiff has duly perfected title, an unlawful detainer action for possession is not yet ripe for determination. (Stonehouse Homes v. City of Sierra Madre (2008) 167 Cal.App.4th 531, 540-541.)

Title is duly perfected when all steps have been taken to make it perfect, i.e., to convey to the purchaser that which he has purchased, valid and good beyond all reasonable doubt…, which includes good record title…, but is not limited to good record title, as between the parties to the transaction. The term ‘duly’ implies that all of those elements necessary to a valid sale exist, else there would not be a sale at all.

(Kessler v. Bridge (1958) 161 Cal.App.2d Supp. 837, 841.)

In plain language in order to file an eviction (UD) action you must first serve a notice (in CA it is a 3 day notice). In order to serve a 3 day notice you must have perfected title. In order to have perfected title you must be the owner of record (i.e., the deed upon foreclosure sale must have been recorded in your name). Strict compliance with statute is required, so no “deeming” is allowed. In this case the sale was conducted, the bidder won the auction, and then served the notice to vacate or pay rent BEFORE THE DEED WAS RECORDED.

“After the trustee’s deed has been recorded, the purchaser is entitled to bring an unlawful detainer action against the borrower-trustor or his or her successor to obtain possession of the property. [Citations.]” (Id. at p. 480, italics added.)

An interesting side note, often pointed out by Charles Koppa in San Diego, is the peculiar way the bids were made that conformed to the amounts required for the accounting at the top of the securitization chain which did not reconcile at all with the amounts at the bottom — both for the benefits of the banks and against the interests of the investors at the top and the borrowers at the bottom. A further observation and sometimes investigation is that there are “transfers” behind the scenes that show up in the name of the winning bidder and/or the name of the party into whose name the deed is recorded.

A defective notice cannot support an unlawful detainer judgment for possession. Respondent’s interpretation, on the other hand, would suggest that a post-foreclosure plaintiff could routinely prematurely issue a three-day notice that includes legal and factual misstatements (e.g., that the purchaser has already duly perfected title when it had not yet done so). And as argued by Appellant, such a practice would practically prevent a defendant from effectively verifying the identity of the alleged purchaser of a property as a search of recorded documents would prove futile.

 

 

6 Responses

  1. Can I use this in New York?

  2. Any lawyers in san Diego that want to help us fight the bankers? We won an appeal due to no SOT giving bank authority to foreclose. On remand they submit new evidence get a MSJ with no reason stated by judge, even after evidentiary hearing.WITH COUNTY CLERKS TESTIMONY. On top of that get a stay granted pending appeal, with a 2700 back payment due ij two days, we don’t owe, and thereby getting a lock out order, that should have been stayed in good faith, even though the UD reversed and remanded, with instruction to vacate, and still holding 20000 we paid pending first appeal, and knowing we had other affirmative defenses.,knowing that proving duly perfected title their responsibility, outright deny having to prove anything and state defendent fails to prove we didn’t. Our appeal of MSJ is close to coming up, NEED LAWYER TO WRITE BRIEFS, OR HELP ME, ASAP, and this is only as defendent, we haven’t even pursued the multiple hbor violations, fraud docs, and we’ll TBD. We can make payments don’t have anything left,

  3. Self-serving documents of the banks are actually being upheld in the Clown Court of Washington courts.

  4. Our home was foreclosed in the middle of June. No papers evidencing foreclosure are provided to us. Also, no foreclosure deed is filed with the town even after 45 days. What does this mean? Please advise.

  5. So not just a matter of the recording date. Previous transfers, purchase must be valid and good.

  6. Reblogged this on California freelance paralegal and commented:
    This case will be very helpful to defendants in eviction after foreclosure proceedings. The fact that it has been ordered published by the California Supreme Court is very good news as this case can now be cited.

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