control over the property. Barbee then apparently used her “leverage” to
“extort” money from Lindsey in the form of ten year lease to the property
for $2,300 a month. 5
Based on the written agreement, Lindsey opposed the motion for
summary judgment and argued he was entitled to stay at the property for
the duration of the lease.6 Despite expressing concerns regarding
Lindsey‟s credibility and his shifting positions regarding ownership, the trial
court determined that Lindsey‟s version of the facts was not dispositive
since the Epps were successors in interest under Code of Civil Procedure
section 1161b.7 As such, even assuming that Lindsey had a valid lease
with Barbee, the trial court concluded that the Epps had no obligation to
honor the lease and Lindsey failed to vacate the premises after expiration
of the 90 days.8 Lindsey now appeals the limited issue of whether the trial
court correctly applied the undisputed facts to section 1161b.9
DISCUSSION
The Standard of Review
We review the propriety of a grant of summary judgment de novo.
(Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 860.) In effect, we
assume the role of a trial court and apply the same rules and standards
5 CT 214-217 6 Reporter‟s Transcript (RT) 33-34 7 RT 41 and 43-44 8 RT 43-44 9 All further statutory references are to the Code of Civil Procedure unless otherwise noted.
3
that govern a trial court‟s determination of a motion for summary judgment.
(Riverside County Comm. Facilities Dist. No. 87-1 v. Bainbridge 17 (1999)
77 Cal.App.4th 644, 652.) Although we would normally engage in the same
three-step analysis required of the trial court, the argument raised by
Lindsey through his appeal is simple: whether the trial court erred in
applying Code of Civil Procedure section 1161b to undisputed facts. We
similarly review de novo the trial court‟s application of a statute to
undisputed facts. (See Be v. Western Truck Exchange (1997) 55
Cal.App.4th 1139, 1143.)
Code of Civil Procedure section 1161b and Its Application
Code of Civil Procedure section 1161b, subdivision (b)(1), provides
that “tenants or subtenants holding possession of a rental housing unit
under a fixed-term residential lease entered into before transfer of title at
the foreclosure sale shall have the right to possession until the end of the
lease term, and all rights and obligations under the lease shall survive
foreclosure, except that the tenancy may be terminated upon 90 days‟
written notice to quit” if, as relevant here, “[t]he purchaser or successor in
interest will occupy the housing unit as a primary residence.”
In this case, even if we assume that Lindsey had a written lease
agreement which preceded the foreclosure, the Epps had no obligation to
honor the lease if they provided a 90 day notice to quit and if they were
“the purchaser or successor in interest” who intended to “occupy the
4
housing unit as a primary residence.” It is undisputed that the Epps
provided the 90 day notice and that they intended to occupy the property
as their primary residence. In fact, Lindsey even acknowledges that the
Epps fit the ordinary or “general” definition of “successor in interest” since
their title can be traced back to the foreclosure through the chain of title. 10
However, Lindsey disputes whether the Epps constitute “successors in
interest” as the term is used in Code of Civil Procedure section 1161b.
“Our fundamental task in construing a statute is to ascertain the
intent of the lawmakers so as to effectuate the purpose of the statute.
[Citation.] We begin by examining the statutory language, giving the words
their usual and ordinary meaning.” (Park Medical Pharmacy v. San Diego
Orthopedic Associates Medical Group, Inc. (2002) 99 Cal.App.4th 247,
250-251.) “If the language of a statute is clear, we must follow its plain
meaning. [Citation.] If, however, the language is susceptible to more than
one reasonable interpretation, then we look to „extrinsic aids, including the
ostensible objects to be achieved, the evils to be remedied, the legislative
history, public policy, contemporaneous administrative construction, and
the statutory scheme of which the statute is a part.‟” (Ibid.)
Here, the term “successor in interest” is not defined by section
1161b. Black‟s Law Dictionary (10th ed. 2014) defines the term as
“[s]omeone who follows another in ownership or control of property. A
10 Opening Brief at p. 12
5
successor in interest retains the same rights as the original owner, with no
change in substance.” The Epps followed Bank of America in ownership,
but they did not do so immediately. Section 1161b is potentially susceptible
to differing interpretations since “successor in interest” is not qualified by
terms like “immediate,” “ultimate,” or “eventual.” On the other hand, section
1161b uses the definite article “the” before “purchase or successor in
interest.” The word “the” is used as a “function word” to indicate “that a
following noun or noun equivalent is definite or has been previously
specified by context or by circumstances” or the word indicates “that a
following noun or noun equivalent is a unique or particular member of its
The successor in interest then-owning the property, intending to
reside there, and who provides the notice to quit is the successor in
interest who would have the most significance in relation to the statute or
who would be the most unique amongst all others within the chain of
succession. To hold that the statute is only referencing the successor in
interest that immediately succeeded the purchaser would be nonsensical
since one who simply appears within the chain of succession, but who
does not currently hold the ownership rights, could not terminate the lease.
Also, if the legislature intended to limit the exception outlined in
1161b to only the purchaser‟s “immediate successor” it could have done
so. For instance, the code section which immediately follows section
6
1161b obligates the “immediate successor in interest” to provide the type
of advisory notice outlined by the statute. (Code Civ. Proc., § 1161c.)
Although the term, as used in section 1161c, is actually a reference to the
purchaser, the use of the phrase “immediate” still demonstrates that if the
legislature wanted to specifically limit the exception under section 1161b to
one specific successor within the chain of title, it could have done so. The
absence of such limiting language suggests that the term “successor in
interest” is not limited to purchaser‟s immediate successor in interest, but
to “the” ultimate or most significant successor in interest who then-owns
the property intending to reside there and who provides the notice to quit.
The term “new owner” is also used within the legislative scheme. For
instance, Lindsey argues that “[t]he notice language required by Civil Code
section 2924.8 provides important guidance on how the legislature
intended section 1161b to apply.” Civil Code section 2924.8 obligates the
“trustee or authorized agent” to post and mail a notice which advises the
residents of the property that “[i]f you have a fixed-term lease, the new
owner must honor the lease unless the new owner will occupy the property
as a primary residence or in other limited circumstances.” (See similar
language in Code Civ. Proc. § 1161c.) Thus, Lindsey argues that the
phrase “successor in interest” does not include just any “owner” within the
chain of title because such a conclusion would mean there is no distinction
between the legislature‟s differing usages of the two terms.
7
However, the legislative history undermines Lindsey‟s position and
only serves to support the trial court‟s ruling. Assembly Bill 2610
simultaneously amended both Civil Code section 2924.8 and Code of Civil
Procedure section 1161b. The author of the bill indicated the increasing
number of foreclosures had resulted in tenants facing the “specter of
sudden dislocation of themselves, their families and their belongings.
Renters are usually the last to know of foreclosure, and many renters,
including families with children, are ending up homeless due to foreclosure
evictions.” (2011 California Assembly Bill No. 2610, California 2011-2012
Regular Session.) The author further indicated “tenants are often confused
or misled about their legal protections, and how long they have to move
when served with a notice to vacate after a foreclosure sale. AB 2610
would help alleviate the debilitating, sudden upheaval of Californians who
reside in foreclosed properties by eliminating the inconsistency, confusion
and abuse of existing laws intended to protect them.” (Ibid.)
Notably, the author also specifically stated that the bill would “require
purchasers of foreclosed homes to give tenants at least 90 days before
commencing eviction proceedings; allow tenants in foreclosed homes
under a residential lease to stay until the end of the lease term, except in
cases where the new owner plans to use the property as their primary
residence….” (2011 California Assembly Bill No. 2610, California 2011-
2012 Regular Session [emphasis added].) When Civil Code sections
8
2924.8 and Code of Civil Procedure section 1161b are read in connection
with the legislative history, it is apparent the terms “successor in interest”
and “new owner” can be used interchangeably, with the latter term being
more easily understood by a lay person and being reserved for the
language of the tenant notices because tenants had been historically
susceptible to confusion.
We see no problem with allowing a successor in interest that is two
steps removed from the foreclosure sale from exercising the same rights
afforded under section 1161b to the “purchaser” or the purchaser‟s
immediate successor.11 This is especially true where the immediate
successor acquired the property on behalf of the ultimate successor. There
is nothing within the language of section 1161b which indicates the Epps
did not succeed to every ownership right that Bank of America acquired
during the foreclosure. “[T]he general rule is that foreclosure of a senior
encumbrance terminates subordinate liens, including leases.” (Nativi v.
Deutsche Bank National Trust Company (2014) 223 Cal.App.4th 261,
272.) Although section 1161b turns the general rule into the exception
when certain conditions are met, the statute does not preclude the Epps
11 This would of course assume that the tenant had been residing at the property all along without the acceptance of rent by the purchaser or its successor in interest. We also see no problem with the fact that the Epps acquired their interest several months after the foreclosure since the facts do not indicate Lindsey tendered any rent that was accepted, meaning the Epps never lost their right to evict Lindsey under section 1161b.
9
from exercising their predecessors‟ right to terminate the tenancy under
the conditions imposed by section 1161b.
Finally, although the statute was enacted in-part to address the
concern that unsuspecting tenants were being evicted despite paying their
rent, the statute‟s exception suggests that the legislature intended to give
the post-foreclosure owner, who doubles as a would-be resident,
preference over a non-defaulting tenant whose interest would have
otherwise been extinguished by the foreclosure. This is especially true
given that the purpose of the statute is furthered based on the fact that the
Epps were required to provide the 90 day notice. Therefore, the trial court
correctly applied the undisputed facts to the law.
DISPOSITION
For all these reasons, the grant of summary judgment is affirmed.
__________________________________ ARTHUR HARRISON Acting Presiding Judge of the Appellate Division
__________________________________ ANNEMARIE PACE Judge of the Appellate Division
__________________________________ CARLOS CABRERA Judge of the Appellate Division
10
AI Brief
AI-generated · verify before citing
Holding. The court held that the term "successor in interest" under Code of Civil Procedure section 1161b is not limited to the immediate purchaser of a foreclosed property, allowing subsequent owners who intend to occupy the property as a primary residence to terminate a lease upon 90 days' notice.
Issues
Whether the term "successor in interest" in Code of Civil Procedure section 1161b is limited to the immediate purchaser of a foreclosed property.
Whether the Epps were entitled to terminate the defendant's lease under section 1161b as successors in interest who intended to occupy the property as their primary residence.
Disposition. Affirmed
Quotations verified verbatim against the opinion
“The absence of such limiting language suggests that the term “successor in interest” is not limited to purchaser‟s immediate successor in interest, but to “the” ultimate or most significant successor in interest”
“the legislature intended to give the post-foreclosure owner, who doubles as a would-be resident, preference over a non-defaulting tenant whose interest would have otherwise been extinguished by the foreclosure.”