Wheeler v. Trefftzs

California Court of Appeal Jun 30, 1964 No. Civ. 7335Published

Before: Griffin

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Holding. A judgment lien does not attach to property where the judgment debtor holds only naked title obtained through fraud, as the creditor's interest is limited to the actual interest possessed by the debtor. Consequently, the rescission of a fraudulent deed nullifies any judgment lien purportedly attached to the debtor's interest in that property.

Issues

Whether a judgment lien attaches to property where the judgment debtor's title was obtained through fraud.
Whether a stipulated judgment rescinding a fraudulent deed is effective against a judgment creditor of the fraudulent grantee.

Disposition. affirmed

Quotations verified verbatim against the opinion

“It is the law in California that the lien of a judgment does not attach to a naked title, but only to the judgment debtor’s interest in the real estate”

“The lienholder, therefore, acquired no superior or greater right than Smith had. The lien therefore failed.”

[272]

GRIFFIN, P. J.

ondents Stanley F. Wheeler and wife Franeine E. Wheeler brought this action against defendants Howard V. Smith, et al, and defendant-appellant Kenneth Trefftzs for damages for fraud, declaratory relief and cancellation of a grant deed and to quiet title. They allege that they were the owners, as joint tenants, of 240 acres in Bar stow; that they were acquainted with defendant Smith, a broker, prior to 1957; that about March 5, 1957, Smith came to their ranch and fraudulently represented that he would purchase a one-half interest in their ranch and would assist in refinancing them to save their entire ranch; that accordingly, after considerable negotiations, and by his fraud, there was deeded to him said undivided one-half interest; that Smith never paid them the amount agreed upon; that Smith recorded the deed on December 8, 1958; that on October 14, 1959, they discovered that Smith had added an additional undivided one-half interest in 40 acres belonging to them in the deed; that Smith conspired with other defendants to have plaintiffs sign a trust deed for $12,000 on the whole 280 acres valued at $150,000. Cancellation of the grant deed, deed of trust and damages are claimed.

Defendant-appellant Trefftzs, sued as Doe One therein, answered and denied each allegation; alleged the execution of the deed by plaintiffs to Smith and wife and that on August 4, 1959, defendant Trefftzs recorded an abstract of judgment against Smith in San Bernardino County for the sum of $48,632.33 and that it remained a senior lien against said Smith’s interest in said property, and he asked for a declaration of his rights in said undivided one-half interest therein.

On August 28, 1962, the Wheelers and the Smiths entered into a stipulation rescinding the agreement in respect to the transaction involving the grant deed of the undivided one-half interest, admitting in detail that the transaction was fraudulent on behalf of the Smiths and cancelling the grant deed obtained on July 22, 1957, and recorded on December 8, 1958. The court denied any judgment for defendants Smith. Judgment was entered accordingly. Notice of entry of such judgment was given to defendant Trefftzs.

On December 28, 1962, after hearing on the issues presented by defendant Trefftzs, the court found generally in favor of plaintiffs; that the stipulated judgment entered on August 31, 1962, expressly decreed that the grant deed dated July

Wheeler v. Trefftzs

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GRIFFIN, P. J.

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