Security Pacific National Bank v. Casavant

Opinion

PERLEY, J. Conrad H. Casavant (appellant) appeals from a deficiency judgment in favor of Security Pacific National Bank (the bank) on a floating home purchase money loan. Citing Code of Civil Procedure section 580b (hereinafter section 580b) and Health and Safety Code section 18038.7 (hereinafter section 18038.7), appellant argues that the bank’s sole recourse is against its collateral, We hold that a lender who makes a purchase money loan to the buyer of a floating home may obtain a deficiency judgment under section 18038.7 and therefore affirm.

Appellant obtained a $65,000 loan from the bank to finance his purchase of a floating home. The loan was secured by the floating home and an assignment of appellant’s rights as lessee of the berth where it was moored. After appellant defaulted on the loan, the bank repossessed and sold the floating home for $24,000. Judgment was entered herein for the unpaid balance of the loan.

Section 18038.7 provides that, “No deficiency judgment shall lie in any event, after the sale of any manufactured home, mobilehome, commercial coach, truck camper, or floating home subject to registration pursuant to this part, for failure of the purchaser to complete his or her sale contract given to the seller to secure payment of the balance of the purchase price of the manufactured home, mobilehome, commercial coach, truck camper, or floating home. This section shall not apply in the event there is substantial damage to the manufactured home, mobilehome, commercial coach, truck camper, or floating home other than wear and tear from normal usage.” (Italics added.) Appellant contends that the first sentence of this statute [130]should be interpreted to preclude the bank from obtaining a deficiency judgment.1 It appears that section 18038.7 has yet to be judicially construed.

Section 18038.7 evolved out of Civil Code section 2983.8 (hereinafter section 2983.8). Section 2983.8, which was added to the Automobile Sales Finance Act (Civ. Code, § 2981 et seq.) in 1972 (Stats. 1972, ch. 1001, § 3, p. 1829) and applies only to contracts entered into on or after March 7, 1973, and before July 1, 1981, prevents recovery of a deficiency judgment after the sale of a mobilehome “for failure of the purchaser to complete his conditional sale contract given to the seller to secure payment of the balance of the purchase price of such mobilehome.” Mobilehomes were not the subject of antideficiency legislation prior to the enactment of section 2983.8. (See Comment (1973) 4 Pacific L.J. 598.) The antideficiency protection applicable to mobilehomes was eventually carried forward into the Health and Safety Code, and was extended to cover floating homes in 1985. (Stats. 1980, ch. 1149, § 10, p. 3738; § 31.5, p. 3751; Stats. 1981, ch. 975, § 3, p. 3740; Stats. 1985, ch. 1467, § 2, p. 5368.)