Foorman v. Wallace

Searls, C. J. The question involved in this appeal may be stated thus: A brings an action against B, sues out and levies an attachment upon the land of the latter, obtains a judgment upon which an execution issues, and the land in question is sold. A, the judgment creditor, becomes the purchaser, receives a sheriff’s certificate of sale, which is filed and recorded, and in due time receives a sheriff’s deed of the premises.

B, the judgment debtor, had conveyed the land before suit brought by a deed which was not recorded, and of which A had no notice until after his receipt and record of the certificate of sale, but which was duly recorded before the sheriff’s deed issued.

[554]If, upon these facts, the title of A under his sheriff’s deed is paramount to that of B under his deed recorded after the sale and recordation of the certificate, and before the sheriff’s deed was recorded, then the judgment and order appealed from should be affirmed; otherwise a reversal should be had.

In other words, is the interest acquired by a purchaser of real estate at a sheriff’s sale, whose certificate of sale is properly recorded, destroyed by the production of a deed from the judgment debtor, executed anterior to the sale, but not recorded until after the record of the certificate of sale, and just prior to the expiration of the time for redemption?

Appellant answers this question in the affirmative, and further contends that respondent, having purchased the land at a sale under his own judgment, and having merely credited the net proceeds of the sale upon such judgment, is not a bona fide purchaser for a valuable consideration.

It has often been held in this state that a conveyance in consideration of the cancellation of a pre-existing indebtedness is a conveyance for a valuable consideration within the meaning of section 1214 of the Civil Code. ( Gassen v. Hendrick, 74 Cal. 444; Frey v. Clifford, 44 Cal. 335; Schluter v. Harvey, 65 Cal. 158.)

A like doctrine prevailed under the recording act in force prior to the code: Hunter v. Watson, 12 Cal. 377, 73 Am. Dec. 543, where it was said: “A judgment creditor, purchasing at his own sale without notice, is a bona fide purchaser within the act.”

It follows from these decisions and the findings that respondent stands in the position of an innocent purchaser for a valuable consideration, without notice at the date of his purchase, in the same manner and to the same extent as an innocent third party would do, who had purchased and paid his money.