Sweet v. O'Leary, No. 38522-4-I
| Court | Court of Appeals of Washington |
| Writing for the Court | GROSSE |
| Citation | 944 P.2d 414,88 Wn.App. 199 |
| Parties | In re the Trustee's Sale of the Real Property of G. Michael SWEET and Louise S. Sweet, husband and wife. G. Michael SWEET and Louise S. Sweet, husband and wife, Appellants, v. Ray O'LEARY; Rockwood Acceptance Corporation; Steven L. Jaffe; Howard Ruvelson, Respondents. |
| Docket Number | No. 38522-4-I |
| Decision Date | 02 October 1997 |
Page 199
SWEET and Louise S. Sweet, husband and wife.
G. Michael SWEET and Louise S. Sweet, husband and wife, Appellants,
v.
Ray O'LEARY; Rockwood Acceptance Corporation; Steven L.
Jaffe; Howard Ruvelson, Respondents.
Division 1.
[944 P.2d 415]
Page 200
Richard G. Birinyi, Bellevue, for Appellants.Thomas L. Gilman, Barrett Hale & Gilman, Seattle, Duncan C. Wilson, Sampson & Wilson, Inc., Renton, for Defendant.
William G. Suttell, Suttell Law Offices, Mercer Island, Samuel S. Chung, Short Cressman & Burgess, Seattle, for Respondents.
GROSSE, Judge.
The homestead exemption creates an interest in property that attaches to the surplus proceeds from a nonjudicial foreclosure sale under a deed of trust such that a judgment creditor's claim is limited to funds in excess of the homestead, if any. The trial court's determination to the contrary is reversed.
This appeal arises from disbursement of surplus funds from a nonjudicial foreclosure sale of the home of G. Michael and Louise S. Sweet. The sale was held on the deed of trust against the Sweets' property. The deed of trust was granted by the Sweets to the primary lender, Seattle
Page 201
First National Bank. A judgment creditor, Ray O'Leary, submitted the winning bid of $245,000. After paying the costs of sale and of the foreclosure, the trustee deposited the surplus of $68,117.96 into the registry of the court. Rockwood Acceptance Corporation (Rockwood), a creditor with rights superior to those of O'Leary, petitioned the court and received its share of the surplus, reducing the fund in the court's registry to approximately $30,000.After disbursement to Rockwood, the Sweets moved to have the remaining surplus disbursed to them, claiming a $30,000 homestead exemption. O'Leary opposed the motion. The trial court agreed with O'Leary and held that the Sweets no longer possessed any homestead right to the funds. O'Leary received the funds remaining in the registry. The Sweets appeal.
Since 1981, homestead protection is "automatic" and protects property owners from the time the real property is occupied as a principal residence. RCW 6.13.040.
The trial court held that the protection of the homestead interest was extinguished by a voluntary sale pursuant to a deed of trust. We disagree. The fact that the Sweets' homestead interest in the property provided no protection against the beneficiary of a deed of trust from realizing on its security does not resolve the relative priority between claimants other than the beneficiary to surplus proceeds.
The rights to and distribution of the surplus proceeds are set forth in the deed of trust statute, RCW 61.24.080(3), which states:
(3) The surplus, if any, less the clerk's filing fee shall be deposited together with a copy of the recorded notice of sale with the clerk of the superior court of the county in which the sale took place. The clerk shall index such funds under the name of the grantor as set out in the recorded notice. Upon depositing such surplus, the trustee shall be discharged from all further responsibilities therefor. Interests in, or liens or claims of liens against the property eliminated by sale under this section shall attach to such surplus in the order of priority
Page 202
that it had attached to the property. The clerk shall not distribute such surplus except upon order of the superior court of such county.(Emphasis added.) It is clear that interests in and liens upon the property are transferred[944 P.2d 416]...
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City of Seattle v. Long, No. 78230-4-I
...223, 6 P.3d 1231 (2000) ("`homestead and exemption laws are favored in law and are to be liberally construed'" (quoting Sweet v. O'Leary, 88 Wn.App. 199, 204, 944 P.2d 414 (1997))); Burch v. Monroe, 67 Wn.App. 61, 64, 834 P.2d 33 (1992) (noting that homestead laws are enacted "in the intere......
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City of Seattle v. Long, No. 78230-4-I
...laws are favored in law and are to be liberally construed’ " (quoting In re Tr.’s Sale of Real Property of Sweet, 88 Wash. App. 199, 204, 944 P.2d 414 (1997) )); Burch v. Monroe, 67 Wash. App. 61, 64, 834 P.2d 33 (1992) (noting that homestead laws are enacted " ‘in the interest of humanity’......
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Wilson v. Rigby, No. 17-35716
...to determine and disburse a debtor's homestead exemption amount is when the property is sold. Sweet v. O'Leary , 88 Wash. App. 199, 200, 944 P.2d 414 (1997) ("The homestead exemption creates an interest in property that attaches to the surplus proceeds from a nonjudicial foreclosure sale un......
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City of Seattle v. Long, 98824-2
...protected while others require an owner to file a declaration. RCW 6.13.040(1), (2); In re Tr.'s Sale of Real Property of Sweet, 88 Wn.App. 199, 201, 944 P.2d 414 (1997) ("Since 1981, homestead protection is 'automatic.'"). Qualifying homes are protected from attachment and execution or for......
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City of Seattle v. Long, No. 78230-4-I
...223, 6 P.3d 1231 (2000) ("`homestead and exemption laws are favored in law and are to be liberally construed'" (quoting Sweet v. O'Leary, 88 Wn.App. 199, 204, 944 P.2d 414 (1997))); Burch v. Monroe, 67 Wn.App. 61, 64, 834 P.2d 33 (1992) (noting that homestead laws are enacted "in the intere......
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City of Seattle v. Long, No. 78230-4-I
...laws are favored in law and are to be liberally construed’ " (quoting In re Tr.’s Sale of Real Property of Sweet, 88 Wash. App. 199, 204, 944 P.2d 414 (1997) )); Burch v. Monroe, 67 Wash. App. 61, 64, 834 P.2d 33 (1992) (noting that homestead laws are enacted " ‘in the interest of humanity’......
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City of Seattle v. Long, 98824-2
...protected while others require an owner to file a declaration. RCW 6.13.040(1), (2); In re Tr.'s Sale of Real Property of Sweet, 88 Wn.App. 199, 201, 944 P.2d 414 (1997) ("Since 1981, homestead protection is 'automatic.'"). Qualifying homes are protected from attachment and execution or for......
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City of Seattle v. Long, 98824-2
...others require an owner to file a declaration. RCW 6.13.040(1), (2) ; In re Tr.’s Sale of Real Property of Sweet , 88 Wash. App. 199, 201, 944 P.2d 414 (1997) ("Since 1981, homestead protection is ‘automatic.’ "). Qualifying homes are protected from attachment and execution or forced sale f......