Clayton v. Wilson, 75010-1-I
| Decision Date | 17 April 2017 |
| Docket Number | No. 75010-1-I,75010-1-I |
| Court | Washington Court of Appeals |
| Parties | ANDREW JAMES CLAYTON, Respondent, v. DOUGLAS MECKLEM WILSON, Defendant, MARY KAY WILSON, Appellant. |
UNPUBLISHED OPINION
APPELWICK, J. — Clayton sought to execute his judgment against three lots owned by Wilson which were contiguous to Wilson's residence. Wilson argues that the three parcels are part of her homestead and cannot be sold on the terms authorized by the court. She also argues that she is entitled to her separate contributions to the property and to appreciation that has accrued since Clayton obtained a judgment against the community property. We conclude that the contiguous parcels are not part of Wilson's homestead. We affirm that the execution sale may be held, but remand for the trial court to determine prior to the sale the value of Wilson's separate property interest in the proceeds that is not subject to the judgment.
FACTS
Mary Kay Wilson's former husband sexually abused Andrew Clayton for many years. The Wilsons sought dissolution of their marriage after the sexual abuse came to light in 2002. In February 2006, Clayton obtained a civil judgment for damages against the Wilsons, jointly and severally.
Prior to Clayton obtaining this judgment against the Wilsons, the Wilsons attempted to transfer nearly all of Mr. Wilson's personal and real property community assets to Ms. Wilson as part of the dissolution. The trial court found this transfer fraudulent. And, as a result, the court voided the transfer and enjoined the Wilsons from further disposing of or encumbering the former community property.
On appeal, this court held that the judgment was enforceable against the marital community, that Wilson's1 liability extends to only the former community property, and that the property transfer was indeed fraudulent. Clayton v. Wilson, 145 Wn. App. 86, 106, 186 P.3d 348 (2008), aff'd, 168 Wn.2d 57, 72, 227 P.3d 278 (2010).
After the property transfer was deemed fraudulent, the Wilsons then owned their real property as tenants in common. That real property included four contiguous parcels in Kenmore, one of which Wilson now resides on. Wilson'smother used to live on one of the parcels, but Wilson claims that residence is now uninhabitable. Another family used to live on another one of the parcels, but Wilson claims that residence is also uninhabitable.
In December 2015, Clayton sought and obtained a writ of execution against the three parcels that Wilson does not reside on. Clayton moved for an order authorizing a sheriff's sale pursuant to the writ. The trial court granted the motion, and authorized the sheriff to proceed with a sale of the three parcels.
Wilson appealed, and a stay of the sale was granted pending this appeal.
DISCUSSION
Wilson makes three arguments on appeal. First, she argues that the three parcels at issue are subject to Washington's homestead exemption. Second, she argues that she is entitled to her separate contributions to the property and appreciation that has accrued since Clayton obtained a judgment against the community property. Finally, she argues for the first time on appeal that the trial court's writ of execution was issued in error.
Wilson argues that the trial court erred by not deeming the three parcels at issue as subject to the homestead exemption. She concedes that she resides on only the fourth parcel, and two of the three bordering parcels have been occupied by others in the past. But, she claims that the three parcels at issue are subjectto the exemption because they are contiguous with the fourth parcel that she resides on.2
Under RCW 6.13.010, property qualifies as a homestead if the owners use the property and the surrounding land as their primary residence:
[T]he homestead consists of the dwelling house . . . in which the owner resides or intends to reside, with appurtenant buildings, and the land on which the same are situated and by which the same are surrounded, or improved or unimproved land owned with the intention of placing a house or mobile home thereon and residing thereon.
The homestead exemption protects up to the amount of the land's value or $125,000, whichever is less, from the reach of creditors. RCW 6.13.030. In other words, a creditor's lien on homestead property is for only an amount in excess of the homestead exemption. In re Trustee's Sale of the Real Property of Upton, 102 Wn. App. 220, 223, 6 P.3d 1231 (2000).
Courts favor the homestead act, ch. 6.13 RCW, and construe it liberally to promote its purpose of protecting family homes. In re Dependancy of Schermer, 161 Wn.2d 927, 953, 169 P.3d 452 (2007). Whether the homestead act exempts property surrounding a parcel where a residence is located is a matter of statutory interpretation, which is reviewed de novo. In re Marriage of Baker, 149 Wn. App. 208, 210-11, 202 P.3d 983 (2009).
Wilson's relies heavily on Baker. Like this case, Baker addressed whether contiguous parcels were exempt as part of a homestead. Id. at 210. The case involved five contiguous parcels that were originally Mr. Baker's parents' property. Id. The parcels were all deeded to Mr. Baker as his separate property during the dissolution. Id. Mrs. Wilson sought a writ of execution against another one of the five parcels, parcel B. Id. Mr. Baker claimed that parcel B was part of his homestead. Id. With little guidance as to the extent of its holding, the court found that parcel B was subject to the homestead exemption. Id. at 212. The court stressed that, based on the statutory language, Id. The court reasoned that its holding was in line with "the sanctitywith which the legislature has attempted to surround and protect homestead rights." Id.
The Baker decision relied on two older cases that support the principle that multiple parcels in a single tract may collectively be deemed a homestead. Id. at 211-12. In Morse v. Morris, 57 Wash. 43, 43-44, 106 P. 468 (1910), Morse owned two blocks of land, block 7 and block 8. Id. at 44. Id. The court found that the parcels on block 7 were part of the homestead, even though the dwelling was on block 8. Id. at 47. The court reasoned that the homestead exemption should include adjacent parcels if those parcels are used to support the residence on the primary parcel:
It represents the dwelling house, at which the family resides, with the usual and customary appurtenances, including outbuildings of every kind necessary or convenient for family use and lands used for the purposes thereof. If situated in the country, it may include a garden or farm. If situated in a city or town, it may include one or more lots, or one or more blocks.
Similarly, in In re Murphy's Estate, 46 Wash. 574, 575-76, 90 P. 916 (1907), the Supreme Court addressed a scenario where a widow sought a homestead exemption for property consisting of four contiguous parcels. The tract contained a total of two buildings. Id. at 577. Prior to the husband's death, the widow had had not abandond the property due to the husband's abuse of the wife. The husband continued to live in the primary dwelling. Id. at 577. Theparcels were bought at one time for the purposes of having a home. Id. The two structures were separated by a fence. Id. One of the structures was "a mere shack." Id. Because the lots were purchased for a home in a single transaction and the wife did not leave the property voluntarily, the court did not find any error in the trial court's decision to apply homestead protection to the entire property. Id. at 577-78.
Under Baker, the homestead protection can apply to contiguous parcels. See id. But, examining the case law that Baker relied upon, the mere fact that parcels are contiguous does not render them per se part of the homestead. Instead, Baker, Morse, and Murphy's Estate dictate that if the household uses the surrounding parcels for purposes related to the use of the primary residence, the surrounding parcels may be protected as homestead. Baker, 149 Wn. App. at 212; Morse, 57 Wash. at 46; Murphy's Estate, 46 Wash. at 577-78. Here, no evidence shows that any of the parcels were used for the enjoyment of Wilson's homestead. Rather, two of the three contiguous parcels contain independent residences, and Wilson concedes that those separate residences have been occupied by others in the past. Wilson's claim is based solely on the contiguous location, not use. Even construing RCW 6.13.010 liberally, the statute does not contemplate that contiguous location alone is sufficient to establish that the homestead applies. The trial court correctly concluded the homestead did not apply to the three lots and properly authorized the execution sale.
Wilson also argues that the trial court erred, because it should have awarded her an equitable lien for the appreciation of and improvements to the property following her dissolution. In other words, she argues that the trial court should have granted her an offset from the proceeds of the impending sale,3 because Washington law allows Clayton to claim only the portion of the property that existed at the time of dissolution.
An equitable lien will be enforced in equity against specific property, though there is no valid lien at law. Sorenson v. Pyeatt, 158 Wn.2d 523, 530 n.9, 146 P.3d 1172 (2006). Equity imposes liens either to carry out the intention of the parties to give as security or to prevent injustice, regardless of the intent. Id. Equitable liens are an equitable remedy and may arise from any number of facts and circumstances. Id. at 535. This court reviews a trial court's decision to grant or deny an equitable lien for abuse...
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