Ortale v. Mulhern

Opinion

THOMPSON, J.

This is an appeal from an order allowing a debtor’s claim of homestead exemption to the proceeds of a sale of homestead property. Creditor contends that the trial court erred in not charging against the portion of the fund subject to the exemption real estate commissions payable upon the sale of the real property and in not thereby reducing the exempt portion of the fund by the amount of the commissions. The contention lacks merit.

[863]

On December 29, 1972, Shirley and William Mulhern recorded a declaration of homestead on their residence at 1719 La Mirada Drive in Santa Barbara. The residence was their community property. On November 13, 1974, Richard Ortale obtained a default judgment against William Mulhern

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in the amount of $9,200 plus interest of $697.67 and costs of $99.40. The judgment was filed of record.

Shirley filed an action to dissolve her marriage to William Mulhern in August of 1974. An interlocutoiy decree of March 4, 1975, awards the homesteaded property to Shirley Mulhern. Shirley sold the property through an escrow which closed on May 15, 1975. After payments on encumbrances on the property and various costs of sale, $24,550.18 remained in the escrow account. Pursuant to the escrow instructions, $4,500 payable from the fund was due Greentree Realty as a commission on the sale. Shirley was an employee of Greentree Realty and was entitled to share in its commission.

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On May 21, 1975, Ortale. obtained a writ of execution in the amount of $10,001.07. The writ directs the sheriff or marshal to satisfy the judgment out of “(1) • . . personal property of judgment debtor(s), not exempt from execution ... or (2) if the judgment is a lien on real property, then out of the real property belonging to debtor(s) on the date the abstract of judgment was filed ....”

The writ was levied upon the escrow holder. The $4,500 commission due on the sale was disbursed. The escrow holder’s answer as garnishee states that it is holding funds in excess of the judgment but that conflicting claims have been made to them. On June 2, 1975, Shirley filed her claim of exemption asserting that by reason of the recorded homestead exemption she was entitled to $20,000 of the fund. Ortale filed his counterdeclaration, claiming that his judgment was superior to any claim of Greentree Realty for its commission on the sale so that the homestead exemption should be allowed only in the amount of $15,500-$20,000 minus the commission of $4,500.