First National Trust & Savings. Bank v. Cerveny

California Court of Appeal Aug 5, 1949 No. Civ. 3947Published

Before: Mussell

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Holding. The court held that a final judgment impressing a trust on real property to secure a debt arising from fraud is not subject to collateral attack, and that a receiver may be appointed to sell the property to satisfy said judgment despite a homestead declaration.

Issues

Whether a final judgment impressing a trust on real property to secure a debt is subject to collateral attack.
Whether a homestead declaration can be used to shield property acquired through fraudulent acts.
Whether the court has authority to appoint a receiver to sell property to satisfy a judgment when the debtor refuses to pay.

Disposition. affirmed

Quotations verified verbatim against the opinion

“The court had jurisdiction of the persons and subject matter and its judgment is not subject to collateral attack.”

“Such a homestead may not be used in a court of equity to preserve to them the fruits of their fraudulent acts.”

“Under the circumstances here shown we see no error in the granting of the order appointing a receiver to carry the judgment into effect and ordering a sale of the property.”

MUSSELL, J.

Isabelle Grainger, an incompetent of the age of 77 years, by and through her guardian obtained a judgment against the defendants herein for the sum of $4,400, plus interest and costs. The judgment provided that any right, title or interest which the defendants, or either of them, held in and to certain real property therein described was held in trust for plaintiff to secure to her the payment of the sums found due. It was ordered that no execution issue until the expiration of 90 days from the date of entry of the judgment. The decree contained a recital that the parties through their respective counsel stipulated that the judgment and decree as ordered should be entered. Subsequent to the entry of the judgment, Isabelle Grainger died and the First National Trust and Savings Bank of San Diego was substituted as plaintiff in the action.

The complaint contained two causes of action. In the first it was alleged that on November 30, 1945, Isabelle Grainger was adjudged an incompetent and a guardian was appointed

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for her; that she was mentally and physically unable to properly manage and take care of herself or her property, which fact was known to defendants; that defendants after gaining the confidence of Isabelle Grainger, and after having falsely professed deep affection and friendship for her, fraudulently procured the delivery to them of all her property, which consisted of $4,591 cash; that defendants promised and agreed to use the funds so obtained to construct a home on their property and that they would care for her the remainder of her life; that the funds were used in the construction of the home on defendants’ real property, therein described, but defendants failed to perform their agreement and Isabelle Grainger became a public charge. The prayer was that it be decreed that the real property be held in trust for Isabelle Grainger and that defendants be required to convey it to her. The second cause of action is based on a common count.

No appeal was taken from the judgment and it became final. Findings of fact and conclusions of law were waived and the judgment was that the defendants hold title to the real property in trust for plaintiff to secure the payment to her of the sum of $4,400. All intendments are therefore in favor of upholding the judgment and it is presumed that every fact essential to support it was proved and found by the court.

First National Trust & Savings. Bank v. Cerveny

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MUSSELL, J.

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