Drapeau v. Smith

California Court of Appeal Aug 11, 1939 No. Civ. 10529Published

Before: Peters

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Holding. Section 580a of the Code of Civil Procedure does not apply to deeds of trust executed prior to the statute's enactment, regardless of whether the foreclosure sale occurred before or after the statute's passage.

Issues

Whether section 580a of the Code of Civil Procedure applies to a deed of trust executed before the statute's enactment when the sale occurred after its enactment.

Disposition. reversed

Quotations verified verbatim against the opinion

“it must be held that section 580a has no application to this case.”

“section 580a has no application to any mortgage or deed of trust executed prior to its passage regardless of whether the sale is had before or after 1933.”

PETERS, P. J.

Plaintiff appeals from a judgment entered upon the sustaining of a demurrer to his complaint to recover a deficiency judgment after sale under a deed of trust.

So far as pertinent here, the complaint alleges that on September 20, 1932, defendants made, executed and delivered to plaintiff their promissory note in the sum of $19,800.00, and a deed of trust securing the same; that on November 12, 1936, the note and deed of trust being in default, and after recordation of a notice of breach and election to sell, a trustee’s sale of the real property covered by the deed of trust was had for $16,000.00; that after applying the sale price to the various charges then due there remained a deficiency of $7,304.27. The defendants demurred to this complaint. The

[85]

trial court sustained the demurrer on the ground the complaint failed to allege compliance with sections 580a and 580b of the Code of Civil Procedure as amended in 1933. On this appeal respondents concede that section 580b of the Code of Civil Procedure has no application, but contend that compliance with section 580a was necessary as a condition precedent to instituting the present action. Section 580a provides generally that in an action for a deficiency judgment, the complaint must allege the amount of the indebtedness secured by the deed of trust at the time of sale, the amount for which the real property was sold,

and the fair market value thereof at the date of sale,

and the date of such sale. The section then limits recovery to the difference between the amount of the indebtedness and the fair market value of the property on the day of sale. The present complaint fails to allege the fair market value of the property on the day of the sale, and it was for this defect that the trial court sustained the demurrer.

Respondents concede that where the deed of trust and the sale thereunder both antedate the enactment of section' 580a, the section has no application. This is in accordance with the decided eases.

(Central Bank of Oakland

Proctor,

Drapeau v. Smith

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PETERS, P. J.

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