Pinebrook Homeowners Ass'n v. Owen, No. 8609-3-II

• Court: Court of Appeals of Washington
• Writing for the Court: PETRICH; ALEXANDER, Acting C.J., and WORSWICK
• Citation: 48 Wn.App. 424,739 P.2d 110
• Decision Date: 09 July 1987
• Docket Number: No. 8609-3-II
• Parties: PINEBROOK HOMEOWNERS ASSOCIATION, a Washington corporation, Respondent, v. Marilyn I. OWEN and Curtis H. Owen, husband and wife, Appellants, and Columbia Collectors, Inc., Defendant.

Page 424

48 Wn.App. 424 739 P.2d 110 PINEBROOK HOMEOWNERS ASSOCIATION, a Washington corporation, Respondent,
v.
Marilyn I. OWEN and Curtis H. Owen, husband and wife, Appellants,
and
Columbia Collectors, Inc., Defendant. No. 8609-3-II. Court of Appeals of Washington,
Division 2. July 9, 1987.

[739 P.2d 112]

Page 425

Gregory L. Bass, Joyce C. Brekke, Evergreen Legal Services, Longview, for appellants.

Barbara A. Peterson, Williams, Kastner & Gibbs, Vancouver, for respondent.

PETRICH, Judge.

Marilyn Owen appeals a judgment and decree of foreclosure which incorporates prior partial summary judgments. The judgment allows for the sale of Owen's home to satisfy the lien of Pinebrook Homeowners Association, (Pinebrook), for past due assessments for exterior maintenance work performed on her home.

Owen presents two issues for appeal: (1) whether the maintenance assessment lien of a homeowner's association can be executed against property to which the debtor's homestead rights attach; and (2) whether the trial court abused its discretion in concluding that a stipulation executed by the parties, whereby Pinebrook would not seek the remedy of foreclosure upon Owen's homestead as a method of execution on any judgment, was only binding until the conclusion of trial.

We reverse, holding that property protected by the homestead exemption cannot be sold in satisfaction of a judgment foreclosing an assessment lien of a homeowners association because: the foreclosure and sale amount to an execution within the meaning of RCW 6.12.090; the lien does not qualify as one of the statutory homestead exceptions in RCW 6.12.100; and the lien does not qualify for the nonstatutory exception developed by case law. ¹ Our resolution of the first issue makes it unnecessary to reach the second.

Pinebrook is a planned community development organized pursuant to a "Declaration of Covenants, Conditions,

Page 426

and Restrictions," (the Covenants). The Covenants were recorded in the Clark County Auditor's Office in 1973. They authorized the creation of a homeowners' association. One of the Association's functions was to perform regular exterior maintenance on the houses of each Pinebrook homeowner and association member. The Covenants also established monthly assessments to pay for the maintenance charges. The Covenants specified that these monthly assessments would be "a charge on the land [of each Pinebrook homeowner] and ... a continuing lien upon the property against which such assessment is made."

Several years later, in 1977, Owen purchased a home in the Pinebrook subdivision. At that time, she obtained a warranty deed from the previous owners which stated that it was subject to "easements, restrictions, conditions and covenants of record." (Emphasis added.) Owen knew of the Covenants when she purchased her home.

In 1978 or 1979, Owen began to withhold payment of her monthly assessments, jinitially because she was dissatisfied with the upkeep of her home, subsequently because of a limited financial situation.

As a result of her nonpayment, Pinebrook filed in Clark County Superior Court a complaint to foreclose its lien for the unpaid assessments. Pinebrook moved for summary judgment. In its order for partial summary judgment, the court established the total amount of assessments due which is not contested by Owen. The judgment also decreed that the Covenants imposed an equitable lien on Owen's property which was superior to her homestead, and that the lien would be foreclosed to the extent it prevailed over her counterclaim for offset.

Trial was held on Owen's counterclaim. The court entered findings of fact and conclusions of law, and a judgment and decree of foreclosure. The final judgment and decree incorporated the partial summary [739 P.2d 113] judgments as well as a judgment with regard to Owen's offset.

The Washington State Constitution provides: "The legislature shall protect by law from forced sale a certain portion

Page 427

of the homestead and other property of all heads of families." Const. article 19, section 1. Pursuant to this section, the Legislature passed laws relating to homesteads, now codified in RCW 6.12.010 et seq. City of Algona v. Sharp, 30 Wash.App. 837, 839, 638 P.2d 627 (1982). The homestead statute implements the policy that each citizen have a home "where his family may be sheltered and live beyond the reach of financial misfortune." Algona, 30 Wash.App. at 841, 638 P.2d 627, quoting Clark v. Davis, 37 Wash.2d 850, 852, 226 P.2d 904 (1951). "Homestead and exemption statutes are favored in the law and should be liberally construed. 'They do not protect the rights of creditors. In fact, they are in derogation of such rights' " (Citation omitted). Lien v. Hoffman, 49 Wash.2d 642, 649, 306 P.2d 240 (1957).

RCW 6.12.090 provides that a homestead is exempt from attachment, and from execution or forced sale except as provided in RCW 6.12. RCW 6.12.100 lists the statutory exceptions to the homestead exemption. It provides:

6.12.100. Homestead subject to execution, when. The homestead is subject to execution or forced sale in satisfaction of judgments obtained:

(1) On debts secured by mechanic's, laborer's, materialmen's or vendor's liens upon the premises;

(2) On debts secured by purchase money security agreements describing as collateral a mobile home located on the premises or mortgages on the premises, executed and acknowledged by the husband and wife or by any unmarried claimant;

(3) On one spouse's or the...