Grothe v. Cortlandt Corp., E009609

• Citation: 15 Cal.Rptr.2d 38,11 Cal.App.4th 1313
• Decision Date: 22 December 1992
• Docket Number: No. E009609,E009609
• Court: California Court of Appeals Court of Appeals
• Parties: Laurene GROTHE, Plaintiff and Respondent, v. CORTLANDT CORPORATION, et al., Defendants and Appellants.

Page 38

15 Cal.Rptr.2d 38

11 Cal.App.4th 1313

Laurene GROTHE, Plaintiff and Respondent, v. CORTLANDT CORPORATION, et al., Defendants and Appellants.

No. E009609.

Court of Appeal, Fourth District, Division 2, California.

Dec. 22, 1992.

[11 Cal.App.4th 1315] James S. Davis, in pro. per.

James S. Davis, Rancho Cucamonga, for defendants and appellants.

Ryskamp and Associates, Riverside, and Donald R. Schindler, San Dimas, for plaintiff and respondent.

OPINION

DABNEY, Acting Presiding Justice.

Defendants Cortlandt Corporation and James S. Davis [hereafter referred to collectively for convenience as "defendant"], appeal from an order of the Superior Court of Riverside County, granting a preliminary injunction restraining the sale of certain real property held by plaintiff Laurene Grothe, to satisfy a judgment against David Daniel Ribis. Plaintiff held the property in joint tenancy with Ribis, the judgment debtor. Defendant, as assignee of the judgment creditor, began proceedings to collect the judgment; however, Ribis died before the property could be sold at execution. Plaintiff maintains that Ribis' interest passed to her as the surviving joint tenant and extinguished any interest against which defendant may satisfy its judgment lien. Defendant argues that the sheriff's levy severed the joint tenancy. For the reasons stated below, we reject defendant's contention.

STATEMENT OF FACTS

In 1983, plaintiff and Ribis purchased real property in Riverside County, taking title as joint tenants. In 1987, Julio Acosta and Lucille Acosta obtained default judgments against plaintiff and Ribis. Plaintiff successfully moved to set aside the default judgment as to her; however, the judgment against Ribis remained outstanding. The Acostas assigned the judgment to defendant in March 1990. Defendant began proceedings to levy on the property, and in July 1990 the Riverside County Sheriff recorded a Notice of Levy under Writ of Execution against the property.

Ribis died in October 1990, before expiration of the 120-day grace period staying sale of the property under Code of Civil Procedure section 701.545. Believing herself entitled to the property as the surviving joint tenant, plaintiff filed an Affidavit of Death of Joint Tenant in conjunction with the opening of an escrow to purchase a mobile home for the property. During the course of the escrow, plaintiff learned for the first time of the judgment lien and levy. Upon discovering that the property had been noticed for sale on March 5, 1991, plaintiff obtained a temporary restraining order enjoining the sale of the property, and subsequently obtained a preliminary injunction halting the sale. The order granting preliminary injunction was entered June 10, 1991, and the notice of appeal was timely filed on June 12, 1991.

DISCUSSION

The purpose of a preliminary injunction is to preserve the status quo pending final resolution upon a trial. (Scaringe v. J.C.C. Enterprises, Inc. (1988) 205 Cal.App.3d 1536, 1542, 253 Cal.Rptr. 344.) The decision whether to grant a preliminary injunction is a matter within the sound discretion of the trial court. (IT Corp. v. County of Imperial (1983) 35 Cal.3d 63, 69, 196 Cal.Rptr. 715, 672 P.2d 121.) The ruling is based on the trial court's determination of two related issues: the likelihood that the plaintiff will prevail on the merits at trial, and the harm the plaintiff will suffer if the relief requested is not granted as compared to the harm the defendants would suffer if the preliminary injunction were issued. (Id., at pp. 69-70, 196 Cal.Rptr. 715, 672 P.2d 121.)

Defendants, who here challenge the injunction, bear the burden of showing an abuse of discretion; that is, that the trial court's determination to grant the preliminary injunction " ' "exceeded the bounds of reason or contravened the uncontradicted evidence." ' " (IT Corp. v. County of Imperial, supra, 35 Cal.3d at p. 69, 196 Cal.Rptr. 715, 672 P.2d 121; see also Scaringe v. J.C.C. Enterprises, Inc., supra, 205 Cal.App.3d at p. 1542, 253 Cal.Rptr. 344.) On appeal we view the evidence in the light most favorable to the prevailing party, drawing all reasonable inferences in favor of the trial court's order. (Triple A Machine Shop, Inc. v. State of California (1989) 213 Cal.App.3d 131, 138, 261 Cal.Rptr. 493.)

An analysis of the legal issue presented, based on the evidence adduced, leads us to conclude that the joint tenancy was not severed by the sheriff's levy. Defendants thus fail to demonstrate the trial court abused its discretion in issuing the preliminary injunction to preserve the plaintiff's rights.

A joint tenancy is a joint interest owned by two or more persons, who have equal interests among themselves. (Civ.Code § 683; Cole v. Cole (1956) 139 Cal.App.2d 691, 695, 294 P.2d 494.) The joint tenants must share unity of time, title, interest and possession. A distinctive feature of joint tenancy, as opposed to other interests in land, is the right of survivorship. This means that when one joint tenant dies, the entire estate belongs automatically to the surviving joint tenant(s). (Cf. Estate of Blair (1988) 199 Cal.App.3d 161, 166, 244 Cal.Rptr. 627; Santoro v. Carbone (1972) 22 Cal.App.3d 721, 729, 99 Cal.Rptr. 488 overruled on other grounds in Tenzer v. Superscope, Inc. (1985) 39 Cal.3d 18, 30, 216 Cal.Rptr. 130, 702 P.2d 212.) Nothing "passes" from the deceased joint tenant to the survivor; rather, the survivor takes from the instrument by which the joint tenancy was created. (Rupp v. Kahn (1966) 246 Cal.App.2d 188, 196, 55 Cal.Rptr. 108; Zeigler v. Bonnell (1942) 52 Cal.App.2d 217, 219-220, 126 P.2d 118.)

If, however, one of the four unities of time, title, interest and possession is destroyed before the death of a joint tenant, the joint tenancy is severed. (Tenhet v. Boswell (1976) 18 Cal.3d 150, 155, 133 Cal.Rptr. 10, 554 P.2d 330.) "A joint tenancy [may be] terminated by a voluntary conveyance ... by a judgment in partition, or by an execution sale." (Clark v. Carter (1968) 265 Cal.App.2d 291, 294, 70 Cal.Rptr. 923 disagreed with on another point in Estate of Carpenter (1983) 140 Cal.App.3d 709, 711, 189 Cal.Rptr. 651 and Riddle v. Harmon (1980) 102 Cal.App.3d 524, 531, 162 Cal.Rptr. 530.) A sale or conveyance of title to a third party, whether voluntary or involuntary, obviously destroys the unities of the joint tenancy and makes the purchaser a tenant in common with the remaining joint tenant(s). (2 Miller & Starr, Cal.Real Estate (rev. ed. 1977) § 13:20, p. 470.) In particular, California courts have long acknowledged that sale upon execution of a judgment severs a joint tenancy. (Hammond v. McArthur (1947) 30 Cal.2d 512, 515, 183 P.2d 1; accord Schoenfeld v. Norberg (1970) 11 Cal.App.3d 755, 760, 90 Cal.Rptr. 47; Zeigler v. Bonnell, supra, 52 Cal.App.2d at p. 219, 126 P.2d 118; Pepin v. Stricklin (1931) 114 Cal.App. 32, 35, 299 P. 557.)

By contrast, the mere imposition of a lien or encumbrance does not sever the joint tenancy. (Tenhet v. Boswell, supra, 18 Cal.3d at pp. 159-160, 133 Cal.Rptr. 10, 554 P.2d 330; People v. Nogarr (1958) 164 Cal.App.2d 591, 594, 330 P.2d 858.) "[A] joint tenant may, during his lifetime, grant certain rights in the joint property without severing the tenancy. But when such a joint tenant dies his interest dies with him, and any encumbrances placed by him on the property become unenforceable against the surviving joint tenant." (Tenhet v. Boswell, supra, 18 Cal.3d at pp. 159-160, 133 Cal.Rptr. 10, 554 P.2d 330 [a lease by one joint tenant of his interest did not sever the joint tenancy, and expired upon his death]; see People v. Nogarr, supra, 164 Cal.App.2d at pp. 594-595, 330 P.2d 858 [mortgage lien did not sever joint tenancy]; see also, Dando v. Dando (1940) 37 Cal.App.2d 371, 372-373, 99 P.2d 561 [mere pendency of an action in partition does not sever a joint tenancy].)

The question before us, then, is whether a recorded levy which has not yet resulted in an execution sale will sever a joint tenancy.

We have found no California cases which directly address the problem, but Zeigler v. Bonnell, supra, 52 Cal.App.2d 217, 126 P.2d 118, is instructive. There, as here, the property was held by two joint tenants, one of whom was a judgment debtor. The court faced the question "[If] the judgment debtor dies prior to a levy of execution but after an abstract of the judgment has been recorded, and a levy of execution is made after the death of the judgment debtor ... does the purchaser at the execution sale secure any rights in the property, or does the surviving joint tenant take the entire property free and clear of the lien of the judgment?" (Id. at p. 219, 126 P.2d 118.) The court held that the judgment lien "prior to execution" (ibid.) did not sever the joint tenancy. Upon the death of the debtor joint tenant, there remained no interest or property right against which the judgment lien could be operative. The creditor could "immediately execute and sell " the debtor's interest, which would sever the joint tenancy. (Id. at p. 221, 126 P.2d 118, emphasis added.) But the creditor may also choose to "keep [the] lien alive and wait until the joint tenancy is terminated by the death of one of the joint tenants." (Ibid.) If the creditor chooses to gamble that the judgment debtor will survive, the judgment lien would immediately attach to the entire property. On the other hand, "If the judgment debtor is the first to die, the lien is lost. If the creditor sits back to await this contingency ... he assumes the risk of losing his lien." (Id. at pp. 221-222, 126 P.2d 118.)

Defendant acknowledges that a judgment lien does not sever the joint tenancy, but argues that under Zeigler an "execution or levy made during the debtor's lifetime does." Defendant points to language in the opinion to the effect that a "mere lien" did not sever the joint tenancy when " 'no execution was issued or levy made on his joint tenancy interest...