Opinion
No. 59216-5-I.
October 29, 2007.
Appeal from a judgment of the Superior Court for King County, No. 06-2-16769-4, Deborah D. Fleck, J., entered November 3, 2006.
Affirmed in part, reversed in part, and remanded by unpublished opinion per Baker, J., concurred in by Schindler, A.C.J., and Ellington, J.
Richard LeMieux and Sherrie LeMieux (the LeMieuxs) brought an action to quiet title in real property. The superior court granted summary judgment quieting title in defendants Neva Joyce Roberts and Jerry Roberts (the Roberts). We reverse in part and affirm in part.
I.
The property in question belonged to Jerry M. King and Janice E. King (the Kings), husband and wife. When the Kings' marriage was dissolved on November 10, 1997, the decree of dissolution changed the wife's name to Janice E. Montoya, and awarded an undivided one-half interest in the subject property to each party. Montoya was also awarded judgment against King in the sum of $13,500.
The Roberts received two deeds of trust on the property to secure loans made after the decree of dissolution. The grantor on both deeds was listed as "Jerry M. King/Wishbone Properties" and the deeds were signed by Jerry King, but not by Montoya. Both deeds were recorded on September 29, 1998.
On September 7, 1999, the LeMieuxs sued the Kings for collection of the unpaid balance of a loan made by the LeMieuxs to the Kings. On March 21, 2000, the LeMieuxs obtained a default judgment in King County Superior Court against Montoya, for $141,124.19.
On August 1, 2001, the Roberts sued the Kings to judicially foreclose on the two deeds of trust issued to them in 1998. A lis pendens in the foreclosure was recorded on October 3, 2001, and a default judgment was entered against Jerry King on December 5, 2001, awarding $301,474.70 to the Roberts, ordering the two deeds of trusts foreclosed, declaring the Roberts' deeds of trust to be first liens on the property, and ordering that the property be sold. On March 25, 2003, a stipulated judgment signed by Montoya was entered in the foreclosure action, granting judgment in favor of the Roberts for $300,082.65, ordering the two deeds of trust foreclosed, declaring the Roberts' deeds of trust to be first liens on the property, and ordering that the property be sold. On April 25, 2005, an order granting voluntary dismissal without prejudice was entered in the Roberts' foreclosure action. The property was not sold before the action was dismissed.
Meanwhile, a sheriff's sale was held on October 1, 2004, pursuant to a writ of execution issued to enforce the judgment entered against King in the November 10, 1997 dissolution. Pursuant to that sale, a sheriff's deed was issued on August 17, 2006, purporting to convey Jerry King's interest in the property to the LeMieuxs. A second sheriff's sale was held on February 11, 2005, pursuant to a writ of execution issued to enforce the March 21, 2000 judgment against Montoya. The LeMieuxs purchased Janice Montoya's undivided one-half interest in the property, and a sheriff's deed was issued to them on August 17, 2006.
On January 20, 2006, Greg W. Haffner, as successor trustee, recorded and served a notice of trustee's sale, non-judicially foreclosing the Roberts' two deeds of trust and setting a sale date. The trustee's sale took place on May 19, 2006. The Roberts were the successful bidders and a trustee's deed was issued the same day, but failed to bear the notary seal. A corrected trustee's deed was issued on June 19, 2006.
The LeMieuxs brought this action to quiet title in the property on May 17, 2006. They appeal the trial court's order granting summary judgment quieting title in the Roberts and ordering the LeMieuxs to pay the Roberts for rents received by the LeMieuxs. They also appeal the trial court's decision not to impose CR 11 sanctions for specious and frivolous claims, based on the Roberts' affirmative defenses of slander of title, violation of the Federal Fair Debt Collection Practices Act, and a claim under the Washington Consumer Protection Act.
Ch. 19.86 RCW.
II.
In reviewing an order for summary judgment, this court engages the same inquiry as the trial court. Summary judgment can be granted only if the pleadings, affidavits, depositions, and admissions on file demonstrate the absence of any genuine issue of material fact, and that the moving party is entitled to judgment as a matter of law. The court must consider all facts submitted and all reasonable inferences from the facts in the light most favorable to the nonmoving party. The motion should be granted only if, from all the evidence, reasonable persons could reach but one conclusion. A trial court's decision regarding whether to impose CR 11 sanctions is reviewed for abuse of discretion.
Wilson v. Steinbach, 98 Wn.2d 434, 437, 656 P.2d 1030 (1982).
CR 56(c); Wilson, 98 Wn.2d at 437.
Wilson, 98 Wn.2d at 437.
Wilson, 98 Wn.2d at 437.
Wash. State Physicians Ins. Exch. Ass'n v. Fisons Corp., 122 Wn.2d 299, 338, 858 P.2d 1054 (1993).
The LeMieuxs argue that the property at 126 Logan Avenue belongs exclusively to them by virtue of two sheriff's deeds. One sheriff's deed purports to convey Jerry King's interest in the property, and was issued following a sheriff's sale enforcing Montoya's judgment against King in the King-Montoya dissolution. The second deed conveys Janice Montoya's interest in the property, and was issued following a sheriff's sale enforcing the LeMieuxs' March 2000 judgment against Montoya. The Roberts argue that the property belongs exclusively to them, based on their non-judicial foreclosure of two deeds of trust issued by Jerry King in 1998. In determining which party has the stronger title in this case, we must separately consider the respective undivided one-half interests awarded to Montoya and King upon dissolution of their marriage. We conclude that the LeMieuxs and the Roberts each have an undivided one-half interest in the property. The LeMieuxs' one-half interest stems from their March 2000 judgment against Janice Montoya, and the Roberts' one-half interest stems from the deeds of trust issued by Jerry King.
Montoya Half Interest
When King issued the trust deeds to the Roberts in 1998, he was no longer married to Montoya. The interest conveyed by those deeds was only the interest King held at the time the deeds were issued. The Roberts argue that the deeds also conveyed Montoya's interest in the property, because Montoya later signed a stipulated judgment stating that the Roberts' deeds were first liens on the property. But that stipulation was not signed until 2003, and the action in which it was filed was later dismissed. Thus, any interest in Montoya's undivided one-half interest in the property pursuant to the stipulation would be junior to the LeMieuxs' March 2000 judgment against Montoya. And, in any event, dismissal of the judicial foreclosure action rendered any order entered therein a nullity. Finally, no judgment entered in that action would affect prior claims on the property asserted by nonparties such as the LeMieuxs.
A sheriff's sale was held on February 11, 2005 to enforce the LeMieuxs' King County Superior Court judgment against Montoya, and a sheriff's deed was issued conveying Montoya's interest to the LeMieuxs.
The Roberts argue that the LeMieuxs waived any claim or interest in the foreclosed property by failing to restrain the trustee's sale in 2006. A trustee's sale conveys only the interest in the property which the grantor had the right to convey at the time the deed of trust was executed. Thus, a non-judicial foreclosure pursuant to a deed of trust extinguishes all junior liens on the property, but has no effect on senior liens. Thus, the trustee's sale had no effect on the LeMieuxs' interest in the Montoya half interest in the real property.
RCW 61.24.050; Glidden v. Municipal Authority of the City of Tacoma, 111 Wn.2d 341, 347 n. 3, 758 P.2d 487, 764 P.2d 647 (1988); Mann v. Household Fin. Corp. III, 109 Wn. App. 387, 392-93, 35 P.3d 1186 (2001).
King Half Interest
The LeMieuxs argue that their interest in King's undivided one-half interest dates back to November 10, 1997, the date of the King-Montoya dissolution, and that their interest in the King half of the property is therefore superior to the Roberts' deeds of trust. The LeMieuxs allege that they obtained title to King's interest in the property by virtue of a sheriff's sale that was held to enforce Montoya's judgment against King in their dissolution. However, the LeMieuxs do not explain how their March 21, 2000 judgment against Montoya gave them a right to Montoya's priority date in her judgment lien against King, nor do they explain how they were able to order a sheriff's sale to enforce Montoya's lien, as opposed to executing on the judgment lien itself.
We need not address a claim absent reasoned argument and citation to legal authority. The judgment lien statute provides that a court judgment is a lien upon the real estate of any judgment debtor. A judgment lien in itself is not real property. Thus, the LeMieuxs' judgment against Montoya did not automatically attach to Montoya's judgment against King, and there was no execution against that lien.
See RAP 10.3(a)(5); State v. Johnson, 119 Wn.2d 167, 171, 829 P.2d 1082 (1992) (declining review of constitutional issues unsupported by reasoned argument).
Even if the LeMieuxs did obtain an interest in the King half of the property, it was created on October 1, 2004, the day they purchased it at the sheriff's sale. Any such interest was thus subject to the Roberts' prior deeds of trust, issued by King in 1998. Thus, when the Roberts foreclosed on the deeds of trust on May 19, 2006, any claim asserted by the LeMieuxs was extinguished.
The LeMieuxs argue that the Roberts made an election of remedies and waived their right to non-judicial foreclosure, because they obtained judgment in a judicial foreclosure proceeding on the same deeds of trust. We disagree. The Roberts had two deeds of trust on King's interest in the property, and those deeds predated any interest the LeMieuxs obtained in the sheriff's sale.
The LeMieuxs next argue that the Roberts' judicial foreclosure was still pending at the time of the trustee's sale because there had not been a sheriff's sale, and that the trustee's sale was held in violation of law. RCW 61.24.030 requires that no action commenced by the beneficiary of the deed of trust against the grantor may be pending at the time of a trustee's sale. However, there was no action pending, because an order of dismissal was entered on April 25, 2005. The deed of trust statute expressly permits a trustee's sale after the dismissal of a judicial foreclosure. RCW 61.24.100 provides:
(2)(a) Nothing in this chapter precludes an action against any person liable on the obligations secured by a deed of trust or any guarantor prior to a notice of trustee's sale being given pursuant to this chapter or after the discontinuance of the trustee's sale.
(b) No action under (a) of this subsection precludes the beneficiary from commencing a judicial foreclosure or trustee's sale under the deed of trust after the completion or dismissal of that action.
Therefore, the Roberts did not waive non-judicial foreclosure, and the Roberts obtained title to the King one-half interest in the property on May 19, 2006, the date of the trustee's sale.
The LeMieuxs and the Roberts each claim they are entitled to rents collected by the other party from the tenant at 126 Logan Avenue. The Roberts allege that collateral estoppel bars the LeMieuxs from arguing that they are entitled to rents from May 17, 2002 through March 31, 2005, because the order approving the receiver's accounting in their judicial foreclosure action is conclusive regarding who is entitled to rents during that period. The Roberts also argue that the judgments against King and Montoya in the judicial foreclosure established the Roberts' exclusive right to rental income from the property.
Collateral estoppel requires that the person against whom the plea is asserted was a party or in privity with a party to the previous action. The LeMieuxs were not a party to the judicial foreclosure, so collateral estoppel does not apply. And any judgments or orders entered in the foreclosure action were nullified by its dismissal.
Pederson v. Potter, 103 Wn. App. 62, 69, 11 P.3d 833 (2000).
We remand this matter to the trial court to determine the amount of rents to which each party is entitled, including any offsets to be applied, in accordance with this opinion.
The LeMieuxs argue that the Roberts violated CR 11 by raising frivolous affirmative defenses and counterclaims. Signing, filing, submitting or advocating a claim that is baseless and advanced without reasonable inquiry into facts and law violates CR 11. A violation is complete upon filing of an offending paper, but a party can mitigate by withdrawing the offending paper. The trial court is in the best position to determine whether CR 11 sanctions are warranted. The court below dismissed the allegedly frivolous claims without CR 11 sanctions in light of its ruling granting summary judgment to the Roberts. On remand, the trial court is free to reconsider whether CR 11 sanctions are appropriate in light of our ruling.
Brin v. Stutzman, 89 Wn. App. 809, 827, 951 P.2d 291 (1998).
Biggs v. Vail, 124 Wn.2d 193, 199-200, 876 P.2d 488 (1994).
Miller v. Badgley, 51 Wn. App. 285, 300, 753 P.2d 530 (1988).
The Roberts' request of attorney fees and costs in connection with this matter is denied.
REVERSED IN PART, AFFIRMED IN PART, AND REMANDED.
WE CONCUR: