Opinion
2d Civil No. B186158
12-11-2006
NOEL C. SIRON and CAROLINE V. SIRON, Plaintiffs and Appellants, v. MARJORY A. VALDEZ, Defendant and Respondent.
Donald M. Adams, Jr., for Appellants. Irwin R. Miller. Daniel S. Miller, for Respondent.
Appellants Noel C. Siron and Caroline V. Siron (Siron) appeal from an interlocutory judgment to partition an Oxnard residence held in the names of the Sirons and Marjory A. Valdez, Caroline Sirons brother. (Code Civ. Proc., § 872.720; 904.1, subd. (a)(9).) The trial court found that respondent, Marjory A. Valdez, owns a 37.5 percent interest and that appellants own an undivided 62.5 percent interest in the property. Appellants argue that the judgment is not supported by the evidence and the trial court erred in not imposing a resulting trust. We affirm.
Facts and Procedural History
In 1995, respondent immigrated from the Philippines and lived with his parents, Jorge and Moore Valdez (senior Valdezs), and appellants. Appellants and the senior Valdezs were renters. Respondents share of the rent was $200 a month.
In April 1996, Caroline Siron told her mother, Moore Valdez, "we have to buy a house." Appellants, respondent, and the senior Valdezs agreed to pool their resources and purchase a house in Oxnard.
In July 1996, the family purchased a house at 4435 Reading Street, Oxnard for $140,000. Appellants, respondent, and the senior Valdezs co-signed on the mortgage. The down payment was about $11,000 of which the senior Valdezs contributed $1,000. Appellant Noel Simon and respondent borrowed $10,000 from their employer for the balance of the down payment.
The grant deed stated that title was taken as follows: "Noel Siron and Caroline V. Siron, husband and wife as joint tenants, an undivided 50% interest, and Jorge Castro Valdez and Moore A. Valdez, husband and wife as joint tenants, an undivided 25% interest and Marjory A Valdez, a single man, an undivided 25%, all as tenants-in-common."
Respondents share of the mortgage, insurance, taxes, and utilities was $400 a month. Respondent paid in cash and gave the money to his mother, Moore Valdez, who turned it over to appellant Caroline Siron. Respondent had no receipts but did keep a payment ledger.
In 1998, appellants decided to refinance the property. The senior Valdezs did not want to co-sign on a new loan and deeded their interest in the property, half to respondent and half to appellants. As a result of the transfer, respondents ownership interest increased from 25 to 37.5 percent.
In 2002, appellants wanted to refinance the house again. Appellants asked respondent to sign a quitclaim deed to take his name off title. Respondent refused to sign the document. Appellant Noel Simon was furious and told respondent that, without receipts, he could not prove that he contributed to the mortgage payments.
Moore Valdez tried to intercede in this dispute but appellants would not discuss it. Appellants told respondent to leave. He did so with his wife and child on March 12, 2002. The senior Valdezs moved out a week later.
Appellant Noel Siron offered to pay respondent $15,000 and gave him a buyout proposal stating that respondent had contributed $ 2,000 to $3,000 for the down payment and had a 25 percent ownership interest. Respondent told appellants the numbers were wrong. The document failed to list respondents full ownership interest, overstated the loan balance, and valued the house at below market price.
Respondent filed a partition action on December 5, 2003. (Code Civ. Proc., § 872.210.) Appellants filed a cross-complaint for quiet title and equitable contribution.
Respondent and Moore Valdez testified that respondent owned part of the house and had paid his share of the down payment, the mortgage, property taxes, and insurance. Appellants denied it all, claiming that respondent was a renter and contributed no money for the purchase.
The trial court found the testimony "sharply conflicting" but "of approximately equal weight, at least with respect to the interests of plaintiff and defendants. The apparently credible testimony of defendants is countered by that of the plaintiff and Mr. Chan [respondents employer], as well as the documentation strongly suggesting plaintiff contributed to the original down payment." The trial court concluded that respondent had an undivided 37.5 percent ownership interest in the property and ordered a partition.
Presumption of Full Beneficial Title
Evidence Code section 662 provides: "The owner of the legal title to property is presumed to be the owner of the full beneficial title. This presumption may be rebutted only by clear and convincing proof." The trial court found that the presumption of full beneficial title applied and was not rebutted by appellants.
On review, all conflicts in the evidence must be resolved in favor of the prevailing party. (Hasson v. Ford Motor Co. (1977) 19 Cal.3d 530, 544.) "[T]he courts have frequently affirmed that there is a presumption that the holder of the legal title owns the full beneficial interest in the property and that the evidence to overcome this presumption and establish that the property is held in trust must be clear and convincing. [Citations.] The trial court is not bound to accept testimony even when unimpeached, against a presumption or contrary reasonable inference from the other facts in evidence [citation] and where as here the only direct evidence of a resulting trust comes from the lips of one whom the court may decide is discredited it certainly cannot be said on appeal that the court was bound to believe him." (Rench v. McMullen (1947) 82 Cal.App.2d 872, 874-875.)
Here the 1996 grant deed stated that respondent had a 25 percent ownership interest and the senior Valdezs had a 25 percent ownership interest. Respondents testimony that he purchased an ownership interest was corroborated by real estate purchase contract, the loan documents, the escrow documents, the purchase money deed of trust, a "Buyer Certification For FHA Mortgage Transactions," a "Notice to Homeowner Assumption of HUD/FHA Insured Mortgages," and the homeowners insurance policy.
Moore Valdez testified that appellants agreed to buy the house with respondent and that respondent would receive a 25 percent ownership interest. This testimony was corroborated by respondents payment ledger and his bank records and pay stubs. Respondent did not have receipts. His payments were in cash. Respondent paid $400 a month to Moore Valdez who turned the money over to appellant Caroline Siron. The most compelling evidence came from respondents and appellant Noel Sirons employer, Aaron Chan, who testified that they borrowed $10,000 for the down payment. Respondents payments to Chan are reflected in Chans loan ledger, respondents payment ledger, and in a $1,500 cashiers check purchased by respondent.
The court did not err in finding that Evidence Code section 662 applied and that the two grant deeds conveyed full beneficial title to respondent as follows: a 25 percent ownership interest when the home was purchased in 1996, and a 12.5 percent ownership interest in the conveyance from the senior Valdezs.
Resulting Trust
Appellants argue that the trial court erred in not imposing a resulting trust which is implied in law when real property is conveyed to one person but the consideration for the purchase is paid by another. (Rowland v. Clark (1949) 91 Cal.App.2d 880, 883; 13 Witkin, Summary of Cal. Law (10th. ed 2005) Trusts, § 311, p. 885 [resulting trust may be imposed to effectuate parties intent].) "[O]ne who claims a resulting trust in property has the burden of proof the facts establishing his beneficial interest by clear and convincing evidence." (Gomez v. Cecena (1940) 15 Cal.2d 363, 366-367.)
Appellants failed to show, by clear and convincing evidence, that they paid the entire down payment and all the mortgage payments. The payment ledgers, the cashiers check, and respondents work bonus checks show that he contributed $2,000 for the down payment. The senior Valdezs used their tax refunds to pay $ 1,000 of the down payment. It was agreed that the senior Valdezs would provide food, child care, and homemaking services in lieu of mortgage payments.
The trial court found that evidence of the senior Valdezs ownership interest was not "robust, but is nonetheless corroborated by circumstantial evidence such as the percentages stated in the original and later deed, and the undisputed arrangement whereby Jorge and Moore [Valdez] contributed a combination of in-kind services and a monthly cash payment. The court concludes such an arrangement would have been unlikely had Jorge and Moore [Valdez] not been part owners."
On review, we do not reweigh the evidence. (Viner v. Untrecht (1945) 26 Cal.2d 261, 267.) "[W]hether or not the evidence offered to change the ostensible character of the [grant deeds] is clear and convincing is a question for the trial court to decide. [Citations.] In such case, as in others, the determination of that court in favor of either party upon conflicting or contradictory evidence is not open to review on appeal. [Citations.]" (Beeler v. American Trust Co. (1944) 24 Cal.2d 1, 7.)
Substantial evidence supports the finding that the original grant deed and 1998 grant deed were unconditional conveyances by which respondent acquired an undivided 37.5 percent ownership interest. "`[W]here, as in the case at bar, a trial court has declared such an instrument to be just what it purports to be, an appellant from such a judgment cannot expect a reversal unless the evidence is almost overwhelmingly the other way . . . . " (Spaulding v. Jones (1953) 117 Cal.App.2d 541, 545.)
Pro Tanto Resulting Trust
Appellants argue that the trial court erred in not imposing a pro tanto resulting trust based on the down payment contributions. Like a resulting trust, appellants must prove the necessary elements by clear and convincing evidence. "[O]ne who relies on a pro tanto trust must establish definitely the proportional amount of the purchase price contributed. In the absence of such proof, a resulting trust will not be declared. [Citations.]" (Socol v. King (1950) 36 Cal.2d 342, 348.)
Appellants claim that respondent and the senior Valdezs only contributed $3,000 for the down payment ($11,000), thereby limiting their aggregate ownership interest to less than 30 percent. We reject the argument because appellants and the other family members agreed to pool their resources to buy the property and share ownership. Respondent paid $400 a month, representing his share of the mortgage payment, taxes, insurance, and utilities. He also made repairs and improvements which included painting, replacing a patio roof, installing garage storage and a new garage door, concrete work, and replacing a fence and a garbage disposal. The senior Valdezs purchased and prepared food for appellants, provided household services and daycare for appellants children, and facilitated the first refinance by transferring their ownership interest to respondent and appellants.
Appellants not only received money and services, but claimed all the mortgage and property tax deductions. We conclude that they were estopped by the purchase agreement to share ownership with respondent. "He who takes the benefit must bear the burden." (Civ. Code, § 3521.) Appellants failed to show, by clear and convincing evidence, that the grant deeds did not convey full-beneficiary ownership to respondent (Evid. Code, § 662) or that respondent and the senior Valdezs took title for appellants benefit. (Gomez v. Cecensa, supra, 15 Cal.2d at pp. 366-367.)
A resulting trust is an "intention-enforcing" trust. (Seabury v. Costello (1962) 209 Cal.App.2d 640, 645.) It arises by implication of law to enforce the inferred intent of the parties to a transaction. (Dabney v. Philleo (1951) 38 Cal.2d 60, 68; Lehmann v. Kamp (1969) 273 Cal.App.2d 701, 705-706.) Substantial evidence supports the finding that imposition of a resulting trust or a pro tanto resulting trust would thwart the parties intent.
Mortgage Payments after Respondent Vacated Property
Appellants next argue that the trial court abused its discretion in finding that respondent was relieved of his obligation to make mortgage payments after vacating the property. The evidence shows that appellants asked respondent to move out and that appellants have had exclusive use and possession of the property. The trial court reasonably concluded that appellants sole use and possession of the property offset respondents share of the mortgage, taxes, insurance, and upkeep. (Hunter v. Schultz (1966) 240 Cal.App.2d 24, 30-32; 12 Witkin, Summary of Cal Law, Real Property, supra, § 49, p. 98.) In a partition action, "the court can offset the rental value against the claim by the cotenant in possession for amounts advanced for interest, taxes, and insurance premiums before distribution of the sale proceeds." (5 Miller & Starr, Cal. Real Estate (3rd ed. 2000) § 12:19 p. 43.)
The judgment (partition order) is affirmed. Respondent is awarded costs on appeal.
We concur:
COFFEE, J.
PERREN, J. --------------- Notes: Caroline Siron testified that the childcare services were worth $250 a month.