Wayland v. State of California

PEEK, J.

The defendants appeal from an adverse judgment in an action to quiet title, which judgment specifically decreed that defendants’ lien for unpaid unemployment insurance taxes was extinguished by a previous foreclosure sale under a deed of trust.

The record, which comes before us upon an agreed statement, shows that in January, 1946, the then owners of the real property involved, Mr. and Mrs. Harry Davis, executed a deed of trust wherein they were named as trustors, and one A. F. Dobrowsky was named as a beneficiary. In January, 1948, defendants, pursuant to section 45.10 of the Unemployment Insurance Act, now section 1703 of the Unemployment Insurance Code, recorded a certificate of lien to secure payment of delinquent taxes owed by Davis to the defendant Department of Employment. The lien was subsequently extended by the filing and recordation of a second certificate. In October, 1950, the Davises being in default, the trustee sold the property under the power of sale contained therein to the beneficiary who in turn subsequently sold the property to plaintiffs. Thereafter plaintiffs brought their action pursuant to the provisions of section 2931a of the Civil Code against the defendants to quiet their title to said real property.

Section 2931a provides in part as follows: “In all actions brought to determine conflicting claims to real property, . . . or to foreclose a deed of trust, mortgage, or other lien upon real property upon which exists a lien to secure the payment of taxes or other obligations, to the State of California, other than taxes upon such real property, the State of California may be made a party, and in such action the court shall have jurisdiction to determine the priority and effect of the liens described in the complaint in or upon the property, but the

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jurisdiction of the court in such action shall not include a determination of the validity of the tax giving rise to the lien or claim of lien ...”

It should also be noted that section 45.10 of the Unemployment Insurance Act provided that the lien created by the recordation of the certificate of tax indebtedness shall have “the force, effect, and priority of a judgment lien.”

The sole question presented on this appeal is stated in the record to be: “Was the lien of the defendants extinguished by the sale of the property under the power of sale contained in the deed of trust?”