Lee v. Brown

• Decision Date: 17 September 1976
• Docket Number: S.F. 23416
• Parties: , 553 P.2d 1121 Barbara A. LEE, Plaintiff and Respondent, v. Edward F. BROWN et al., Defendants and Appellants.
• Court: California Supreme Court

Page 649

132 Cal.Rptr. 649

18 Cal.3d 110, 553 P.2d 1121

Barbara A. LEE, Plaintiff and Respondent, v. Edward F. BROWN et al., Defendants and Appellants.

S.F. 23416.

Supreme Court of California.

Sept. 17, 1976.

Bruce I. Cornblum, San Diego, and Robert L. Mezzetti, for defendants and appellants.

Mandich, Clark & Barker and Wesley L. Barker, Sacramento, for plaintiff and respondent.

RICHARDSON, Justice.

In this case we consider whether defendants in a foreclosure action have waived their right to appeal a trial court judgment ordering an execution sale of their homesteaded property by accepting the amount of their homestead exemption from the sales proceeds. We conclude that defendants have not waived their appeal right.

In 1967 defendants recorded a valid declaration of homestead on their real property in Lake County. Thereafter plaintiff, having recovered a judgment against defendants in the sum of $42,366.54, caused a writ of execution upon the judgment to be levied on the homesteaded property. Pursuant to Civil Code section 1245 et seq., plaintiff then had the property evaluated by three appraisers. Based on their reports, the trial court found that the value of the property was $93,096. The court determined further that the amount of valid liens and encumbrances on the property was $26,486.17, and that the value of defendants' homestead exemption was $15,000. Concluding on the basis of these findings that the value of the property exceeded the amount of the liens and homestead exemption, the court ordered that the property be sold under execution.

Defendants appealed but, because they were unable to post the appropriate undertaking pending appeal, they could not prevent the execution sale which occurred on January 27, 1975. At the sale plaintiff, the only bidder, purchased the property for $84,000. From the proceeds and pursuant to Civil Code section 1256 the sheriff tendered defendants the amount of their homestead exemption, which amount they accepted.

Before it could be heard plaintiff moved for dismissal of the appeal on the ground that, having accepted its fruits, defendants were estopped from seeking appellate review of the judgment. We now consider this motion.

At stake are the concurrent preferred rights of appeal and of homestead. We stated in Slawinski v. Mocettini (1965) 63 Cal.2d 70, 45 Cal.Rptr. 15, 403 P.2d 143: 'It is a well established policy that, since the right of appeal is remedial in character, our law favors hearings on the merits when such can be accomplished without doing violence to applicable rules. Accordingly in doubtful cases the right to appeal should be granted.' (Id., at p. 72, 45 Cal.Rptr. at p. 16, 403 P.2d at p. 144; see also Cal. Rules of Court, rule 53; In re Morrow (1970) 9 Cal.App.3d 39, 45, 88 Cal.Rptr. 142; Desherow v. Rhodes (1969) 1 Cal.App.3d 733, 745, 82 Cal.Rptr. 138, gh. den.)

Similarly, the law favors homesteads. They are constitutionally authorized (Cal.Const., art. XVII, § 1), statutorily enacted (Civ.Code, § 1240), and liberally protected. (Thorsby v. Babcock (1950) 36 Cal.2d 202, at p. 204, 222 P.2d 863; Estate of Kachigian (1942) 20 Cal.2d 787, 791, 128 P.2d 865; Schoenfeld v. Norberg (1970) 11 Cal.App.3d 755, 764, 90 Cal.Rptr. 45.) Our duty is to harmonize as far as possible, the foregoing important rights, preserving the rights of appeal and homestead, while protecting the legitimate interests of the creditor.

Plaintiff's motion has the support of a decision of this court, Turner v. Markham (1907) 152 Cal. 246, 92 P. 485. (See also Pickens v. Coffey (1933) 136 Cal.App. 105, 27 P.2d 914.) In Turner we held that by accepting the proceeds of a homestead exemption, a judgment debtor waives the right to appeal a judgment ordering an execution sale of the homesteaded property. We conclude that accepting the benefits of a judgment and pressing an appeal from the judgment are inherently and impermissibly inconsistent. Although Turner relies on a legal principle that is sound in its general application, we have concluded that it does not accomplish a fair result within the homestead context.

We now reexamine the Turner holding in light of the conjunction of appeal and homestead principles, and consider in particular certain recognized exceptions to the rule of appeal waiver as they bear on the homestead law. We will conclude that, while these principles and exceptions are not directly applicable to the present case, together they provide a compelling rationale for the rule that the acceptance of homestead benefits from the proceeds of an execution sale does not, standing alone, constitute a waiver of the right to appeal from a judgment ordering that sale. This rule assures a more equitable recognition of the legitimate interests of both creditor and debtor.

A waiver of the right to appeal a judgment is implied in a variety of situations. (See 6 Witkin, Cal.Procedure (2d ed. 1971) Appeal, §§ 133--146, pp. 4129--4142.) We consider two of them.

First, as a general proposition, one who Accepts the Benefits of a judgment cannot thereafter attack the judgment by appeal. In Estate of Shaver (1900) 131 Cal. 219, 63 P. 340, we expressed the rule as follows: 'The right to accept the fruits of a judgment, and the right of appeal therefrom, are not concurrent. On the contrary, they are totally inconsistent. An election to take one of these courses is therefor a renunciation of the other.' (Id., at p. 221, 63 P. at p. 340, citation omitted.) In the words of Turner, acceptance by the appellant of the benefits of a judgment constitutes an '. . . affirmance of the validity of the judgment against him.' (Turner, supra, 152 Cal. at p. 247, 92 P. at p. 486.) This general rule has been applied in a number of contexts. (See, e.g., Schubert v. Reich (1950) 36 Cal.2d 298, 223 P.2d 242 (appellant accepted money pursuant to an order of the court that had explicitly conditioned the granting of plaintiff's motion for a new trial on the payment to defendant of that money, which order appellant then attempted to challenge); Giometti v. Etienne (1936) 5 Cal.2d 411, 55 P.2d 216 (appellants paid the balance due on a contract of purchase, received a conveyance of property, encumbered that property, and filed a satisfaction of judgment); Wilson v. Wilson (1958) 159 Cal.App.2d 330, 323 P.2d 1017 (appellant accepted the benefits of a divorce decree and then sought to appeal the portion of the decree imposing obligations upon him); see also 6 Witkin, Cal.Procedure, Supra, Appeal, §§ 136--137, pp. 4131--4133.)

As is so often the case, however, application of the rule has generated a number of equitable exceptions. A waiver is not implied, for example, in those cases in which appellant is concededly entitled to the accepted benefits, and his right to them is unaffected by the outcome of the case on appeal. (Estate of Hubbell (1932) 216 Cal. 574, 577, 15 P.2d 503.) Stated another way, one may appeal from a portion of a severable and independent judgment while accepting the benefits of the unaffected remainder of the judgment. (Templeton Feed & Grain v. Ralston Purina Co. (1968) 69 Cal.2d 461, 468--469, 72 Cal.Rptr. 344, 446 P.2d 152; Mathys v. Turner (1956) 46 Cal.2d 364, 365, 294 P.2d 947; Gudelj v. Gudelj (1953) 41 Cal.2d 202, 214--215, 259 P.2d 656; Estate of Hubbell, supra, 216 Cal. 574, 577, 15 P.2d 503; Preluzsky v. Pacific Co-operative C. Co. (1925) 195 Cal. 290, 293, 232 P. 970; see also 6 Witkin, Cal.Procedure, Supra, Appeal, §§ 138--139, pp. 4134--4136.)

While the parties agree that defendants are entitled at the least to the equivalent of the amount they accepted, that is, $15,000, the value of their homestead exemption, the foregoing severability exception to the general waiver rule is not directly applicable. The judgment is not truly severable for if defendants were to prevail on appeal, this sum would have to be returned to plaintiff in exchange for the homesteaded property. (See Mathys v. Turner, supra, 46 Cal.2d 364, 365, 294 P.2d 947; Schubert v. Reich, supra, 36 Cal.2d 298, 300, 223 P.2d 242; Preluzsky v. Pacific Co-operative C. Co., supra, 195 Cal. 290, 293, 232 P. 970; San Bernardino v. Riverside County (1902) 135 Cal. 618, 621, 67 P. 1047.)

Second, a waiver will be implied where there is Voluntary compliance with a judgment, as when the judgment debtor satisfies the judgment by making payment to the prevailing party under its terms. (See Code Civ.Proc., § 1049; Hellman Commercial T. & S. Bk. v. Alden (1929) 206 Cal. 592, 599, 275 P. 794; see also 6 Witkin, Cal.Procedure, Supra, Appeal, § 134, p. 4129.) Again, the waiver rule as applied in this context is also subject to an exception. A waiver of the appeal right occurs only where the compliance was '* * * by way of compromise or with an agreement not to take or prosecute an appeal.' (Estate of Merrill (1946) 29 Cal.2d 520, 524, 175 P.2d 819, 822; see Wisniewski v. Clary (1975) 46 Cal.App.3d 499, 502, 120 Cal.Rptr. 176; County of Los Angeles v. Resolute Ins. Co. (1972) 22 Cal.App.3d 961, 963, fn. 1, 99 Cal.Rptr. 764; Mackay v. Whitaker (1952) 112 Cal.App.2d 112, 117, 245 P.2d 521.) Thus where compliance arises under compulsion of risk or forfeiture, a waiver will not be implied. (See, e.g., Reitano v. Yankwich (1951) 38 Cal.2d 1, 237 P.2d 6 (appellant faced with an execution sale against his property if judgment not satisfied); Alamitos Land Co. v. Shell Oil Co. (1933) 217 Cal. 213, 17 P.2d 998 (appellant acts to avoid forfeiture of his property); Sapin v. Security First National Bank (1966) 243 Cal.App.2d 201, 52 Cal.Rptr. 254; Wisniewski v. Clary, supra, 46 Cal.App.3d 499, 120 Cal.Rptr. 176 (appellant complies with judgment to escape dismissal of his action under the terms of a contested trial court judgment); see also 6 Witkin, Cal.Procedure, Supra, Appeal, § 135, pp. 4129--4131.)

The forfeiture exception to the general waiver rule has particular application to the present case because, as a...