Articles Posted in Real Estate & Property Law

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The owner of Greenfield Ranch in Mendocino County subdivided the property into 25 parcels with a minimum acreage of 160 acres each. One of those parcels was divided by a 1975 partition judgment into three parcels. McLear-Gary owns the westernmost parcel (1-A). The Scotts own the easternmost parcel (1-C). The Brandon-Scotts own the center parcel (1-B). McLear-Gary claims an easement along a skid trail that passes through parcel 1-C, terminates at a creek and continues on a footpath over parcel 1-B to her parcel 1-A. In 2006, Scott replaced an old wooden gate with a metal gate across the easement route and kept it locked, blocking McLear-Gary from accessing the easement. McLearGary sued to quiet title. The Scotts had timely paid taxes on parcel 1-C; the taxes levied against parcel 1-B for the years 2005-2008 were not paid on time and remained delinquent until Scott made a lump sum payment in 2011. The court of appeal held that the covenants did not grant McLear-Gary an express easement and that McLear-Gary had not established a prescriptive easement for vehicular use. Scotts’ lump sum payment of several years’ worth of delinquent taxes did not constitute “timely” payment of taxes under Code of Civil Procedure section 325(b), so the Scotts did not extinguish her easement by adverse possession. View "McLear-Gary v. Scott" on Justia Law

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Stabilis Fund II, LLC (Stabilis) held a trust deed on an apartment complex in Indio. In 2013, Stabilis sued the owners of the property, alleging that the underlying loan was in default, seeking judicial foreclosure, and, in the interim, seeking a receiver “to make sure that the Real Property is properly maintained and that property conditions do not pose a risk of harm to tenants and third parties.” On Stabilis’s motion, the trial court appointed a receiver. In 2014, the City of Indio (City) intervened, alleging the property was a public nuisance, riddled with hazardous and substandard conditions in violation of state and local law. It moved to modify the receivership by instructing the receiver to remedy these conditions. Stabilis did not argue that the City was not entitled to the requested modification; however, it did argue that the motion was premature, that the receiver already had the necessary powers, and that it should be allowed to proceed with foreclosure. The trial court nevertheless granted the motion. The City then moved for an award of its attorney fees and expenses. The trial court granted the motion; it awarded the City $98,190.47, to be paid out of the receivership estate, if there were sufficient funds, and if not, then by Stabilis. Stabilis appealed, arguing that it was only the lender: if anyone was liable for attorney fees and expenses, it should have been the owners. More specifically, it argued that none of the three statutes cited by the City authorized the trial court’s award of attorney fees and expenses against it under the circumstances of this case. The Court of Appeal agreed, and reversed. View "Kaura v. Stabilis Fund II, LLC" on Justia Law

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Stabilis Fund II, LLC (Stabilis) held a trust deed on an apartment complex in Indio. In 2013, Stabilis sued the owners of the property, alleging that the underlying loan was in default, seeking judicial foreclosure, and, in the interim, seeking a receiver “to make sure that the Real Property is properly maintained and that property conditions do not pose a risk of harm to tenants and third parties.” On Stabilis’s motion, the trial court appointed a receiver. In 2014, the City of Indio (City) intervened, alleging the property was a public nuisance, riddled with hazardous and substandard conditions in violation of state and local law. It moved to modify the receivership by instructing the receiver to remedy these conditions. Stabilis did not argue that the City was not entitled to the requested modification; however, it did argue that the motion was premature, that the receiver already had the necessary powers, and that it should be allowed to proceed with foreclosure. The trial court nevertheless granted the motion. The City then moved for an award of its attorney fees and expenses. The trial court granted the motion; it awarded the City $98,190.47, to be paid out of the receivership estate, if there were sufficient funds, and if not, then by Stabilis. Stabilis appealed, arguing that it was only the lender: if anyone was liable for attorney fees and expenses, it should have been the owners. More specifically, it argued that none of the three statutes cited by the City authorized the trial court’s award of attorney fees and expenses against it under the circumstances of this case. The Court of Appeal agreed, and reversed. View "Kaura v. Stabilis Fund II, LLC" on Justia Law

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Tan sued Summers and Gomez to resolve a dispute about investment real estate they jointly own in San Francisco, concerning the amount of each party’s ownership interest and corresponding right to receive income and obligation to pay expenses. The parties sought quiet title, partition, and an accounting. Tan moved for summary adjudication, requesting the property be partitioned and sold by private sale with the proceeds to be held in escrow until resolution of the litigation. Although Summers and Gomez also sought partition, they opposed the motion because the sold property would not generate rental income while their interests were litigated. The court granted Tan’s motion, stating: “Judgment is entered for the real property [at issue] to be partitioned and sold by private sale, for all liens to be paid, a referee shall be appointed, and all sale proceeds shall be held in escrow until final resolution of this matter.” The court of appeal reversed. The partition statutes do not allow a court to order the manner of a property’s partition, such as the sale here, before it determines the ownership interests in the property, Code of Civil Procedure 872.720(a). View "Sumners v. Superior Court" on Justia Law

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Buyer contracted in 2004 to purchase Sellers’ Francisco gas station, to build a condominium project. Buyer had to obtain the necessary “Entitlements” for development. It took eight years to secure the conditional use permit. Sellers alleged the deal had expired. In 2014, Buyer sued, asserting breach of contract (specific performance) and quantum meruit to recover costs for work performed at Sellers’ Mountain View gas station. On the breach of contract claim, the court found the jury deadlocked and declared a mistrial. At Buyer’s request, the court decided that claim and found Buyer failed to perform his contractual obligations and was not entitled to specific performance. On the quantum meruit claim, the jury awarded Buyer $156,000 as the reasonable cost of work at Seller’s Mountain View property. The court vacated that verdict because Buyer had not produced a certificate of licensure to show compliance with Business and Professions Code 7031. The court of appeal affirmed in part. Buyer’s election to have the court decide his specific performance claim waived any claims of error he had and there was substantial evidence that Buyer failed to perform by not timely paying the purchase price after securing the Entitlements; he was properly denied specific performance. The court reversed on the quantum meruit claim. Public policy is not served by vacating the verdict awarded Buyer, an undisputed California-licensed contractor, for work he performed. View "Tierney v. Javaid" on Justia Law

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The Court of Appeal affirmed the trial court's judgment in favor of a good faith purchaser at a lien sale that had acquired the contents of a storage unit free and clear of plaintiff's claim that the sale violated the California Self-Service Storage Facility Act. The court held that the conversion action was barred by the good faith purchaser provisions of Bus. & Prof. Code section 21711. The court also held that the action was barred by the doctrine of judicial estoppel which precluded a party from relying upon a theory in a legal proceeding inconsistent with one previously asserted. In the first suit against the storage facility owner, plaintiff claimed the owner did not abide by the requirements of the Act. In this case, plaintiff claimed that the Act did not apply and that defendant was liable for conversion regardless of whether he was a good faith purchaser. View "Nist v. Hall" on Justia Law

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After defendant filed a wrongful foreclosure action against the trustee of a foreclosure sale (Placer) and the third-party buyer, Pro Value, Placer filed a complaint in interpleader and deposited the surplus proceeds from a foreclosure sale with the court. The Court of Appeal affirmed the trial court's judgment of dismissal after the trial court sustained defendant's demurrer to the interpleader complaint without leave to amend. The court held that Placer was statutorily required under Civil Code section section 2924k to disburse surplus funds to defendant, and that Placer could safely distribute the surplus funds to defendant without any risk of multiple liability. The court remanded with directions to release the interpleaded funds to defendant. View "Placer Foreclosure, Inc. v. Aflalo" on Justia Law

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Santa Rosa decided to turn a 69-bed defunct hospital into the "Dream Center" to house 63 people, ages 18-24, and provide individual and family counseling, education and job training, a health and wellness center serving the community for ages five through 24, and activities for residents, including a pottery throwing area, a half-court basketball area, and a garden. Neighbors challenged the project under the California Environmental Quality Act (CEQA) (Pub. Resources Code 21000), arguing that noise impacts required preparation of an environmental impact report (EIR). The city issued a negative declaration, indication that the project would not have a significant environmental effect and an EIR would not be required. On appeal, the neighbors focused on traffic noise from the south parking lot adjacent to the Dream Center, and noise from the residents’ outdoor recreational activities. The court of appeal affirmed, finding no substantial evidence that there would be a significant noise impact from those sources. The predicted parking lot noise impacts are largely hypothetical, given the city’s parking restrictions in that lot; neighbors' impact calculations were based on data from a different project that cannot reasonably be applied to the Dream Center. An argument that the noise from residents’ outdoor activities would constitute a significant environmental impact was also based on a flawed analysis. View "Jensen v. City of Santa Rosa" on Justia Law

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The term "invasion of the right of private occupancy" is ambiguous and may include non-physical invasions of rights in real property. The Court of Appeal reversed the trial court's grant of summary judgment for the umbrella insurer in an action alleging claims for breach of contract and breach of the implied covenant of good faith and fair dealing. In this case, the personal injury provision of plaintiff's umbrella policy potentially covered the allegations in the underlying action and the umbrella insurer breached its duty to defend by not providing plaintiff with a defense. Accordingly, the court vacated the trial court's order and directed the trial court to enter a new order granting the motion. View "Albert v. Truck Insurance Exchange" on Justia Law

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A successor trustee filed suit against defendants, alleging claims arising from an allegedly void assignment of a deed of trust on certain real property and a failed short sale agreement. The Court of Appeal held that the trial court properly sustained the demurrers to all causes of action, but abused its discretion in denying leave to amend. In this case, the trustee has proposed facts sufficient to show that the assignment at issue was void. Accordingly, the court reversed and directed the trial court to grant the trustee leave to amend the complaint. View "Hacker v. Homeward Residential, Inc." on Justia Law