Judge: Armen Tamzarian, Case: 23STCV13385, Date: 2023-09-18 Tentative Ruling

Case Number: 23STCV13385    Hearing Date: September 18, 2023    Dept: 52

Defendant Hector Macias Corrales’s Demurrer to Complaint

Defendant Hector Macias Corrales demurs to the first and third causes of action alleged in plaintiff Victor Reyes’s complaint.

First Cause of Action for Quiet Title

Plaintiff does not allege sufficient facts for quiet title.  “The purpose of a quiet title action ‘is to finally settle and determine, as between the parties, all conflicting claims to the property in controversy, and to decree to each such interest or estate therein as he may be entitled to.’ ”  (Deutsche Bank National Trust Co. v. Pyle (2017) 13 Cal.App.5th 513, 524.) 

Plaintiff seeks to quiet title to a 100% ownership interest in the subject property.  (¶¶ 16, 21, 24.)  He alleges defendant “has abandoned his interest in and his claims to Fidel Ave by his conduct and actions.”  (¶ 23.)  Plaintiff contends defendant abandoned his interest because plaintiff “has paid all mortgage payments, taxes, and costs to repair” the property.  (¶ 14.) 

The complaint, however, alleges defendant has an interest in the property because he is a joint tenant.  “Joint tenancy is a joint interest owned by two or more persons in equal shares.  [Citation.]  The cotenants have equal interests among themselves.”  (Cole v. Cole (1956) 139 Cal.App.2d 691, 695.)  Plaintiff alleges he and defendant purchased the subject property “as joint tenants” and “both contributed to the down payment for the purchase.”  (¶ 2.)  The recorded grant deed attached to the complaint states the property was transferred to plaintiff and defendant “as Joint Tenants.”  (Ex. A.)  Plaintiff also alleges, “Father and son secured a purchase money loan for” the property.  (¶ 12.)  The recorded deed of trust states the trustors and borrowers are plaintiff and defendant “as joint tenants.”  (Ex. B, p. 1.) 

The complaint’s allegations and exhibits thus show defendant owns a 50% interest in the property.  Plaintiff provides no authority that someone with title to real property as a joint tenant loses all interest in the property if he fails to pay for expenses after purchasing the property.  Rather than a basis for quieting title, these allegations concern the issue of credits upon partition by sale.  “Every partition action includes a final accounting according to the principles of equity for both charges and credits upon each co-tenant’s interest.  Credits include expenditures in excess of the co-tenant’s fractional share for necessary repairs, improvements that enhance the value of the property, taxes, payments of principal and interest on mortgages, and other liens, insurance for the common benefit, and protection and preservation of title.”  (Wallace v. Daley (1990) 220 Cal.App.3d 1028, 1035–1036.)  Plaintiff’s second cause of action seeks partition by sale.  (Comp., ¶¶ 25-34.) 

Plaintiff relies on a single case, Hall v. Hall (1950) 98 Cal.App.2d 209.  It does support plaintiff’s position.  There, the plaintiff had defendant buy real property “for and on [plaintiff’s] behalf.”  (Id. at p. 210.)  The parties agreed that “plaintiff would furnish the money therefor but title was to be taken in defendant’s name with the understanding that after all payments were made and plaintiff was entitled to hold title thereto, defendant would transfer said property to him.”  (Ibid.)  They made this arrangement because plaintiff “was on parole from” prison and “was precluded from entering into any civil contract.”  (Ibid.)  The trial court “found that plaintiff made all such payments” to purchase the property.  (Id. at p. 212.)  In other words, plaintiff paid the entire price of the property, but defendant held 100% legal title solely for plaintiff’s benefit.  The plaintiff could not have had any right to partition because he had no legal interest in the property. 

In contrast, plaintiff’s complaint alleges he and defendant “both contributed to the down payment” and were “joint tenants.”  (Comp., ¶ 2.)  He thus alleges both parties hold a 50% interest in the property.  The complaint does not allege the parties intended for defendant to hold his 50% interest on behalf of plaintiff as the equitable owner.  Plaintiff has not alleged sufficient facts to permit him to quiet title to a 100% interest in the property.

Third Cause of Action for Resulting Trust

Plaintiff does not allege sufficient facts for this cause of action.  A resulting trust “arises where one, in good faith, acquires title to property belonging to another.  The law implies an obligation on the part of the one in whom title has vested to hold the property for the owner’s benefit and eventually convey it to the owner.”  (Estate of Yool (2007) 151 Cal.App.4th 867, 874.)  “Ordinarily a resulting trust arises in favor of the payor of the purchase price of the property where the purchase price, or a part thereof, is paid by one person and the title is taken in the name of another.”  (Martin v. Kehl (1983) 145 Cal.App.3d 228, 238.)

Plaintiff does not allege he paid for the property and defendant took title to it on his behalf.  As discussed above, he alleges both parties contributed to the down payment and each acquired a 50% interest in the property as joint tenants.  (Comp., ¶ 2.) 

Plaintiff’s reliance on Seabury v. Costello (1962) 209 Cal.App.2d 640 is misplaced.  There, “plaintiff paid the entire purchase price of the property” and “both Plaintiff and defendant agreed prior to the purchase of the property that defendant was not to receive a present beneficial interest in the property as a result of being named in the deed as joint tenant.”  (Id. at p. 644.)  The court explained the applicable rule: “[A] resulting trust should be established as to any joint interest which is conveyed to another in favor of one who has paid the entire purchase price of the property, where it was intended and understood between the parties that the noncontributing party should enjoy a beneficial interest as joint tenant only if predeceased by the joint tenant who contributed the purchase price.”  (Ibid.)

Here, plaintiff alleges, “The loan and title are in both Mr. Reyes and Mr. Corrales’ names, however, it was the intent of the parties that father and son would purchase the property together for the purpose of Mr. Reyes taking care of his son, Mr. Corrales.  The parties purchased as joint tenants so that if Mr. Corrales’ passed before his father, Mr. Reyes would own Fidel Ave 100% without having to go through probate.”  (¶ 37.)

That the parties intended for plaintiff to acquire 100% title to the property upon defendant’s death without going through probate does not mean the parties intended that defendant would have no present beneficial interest in the property.  That is the standard reason to purchase property as joint tenants.  “[T]he ‘grand’ and ‘distinguishing’ incident of the joint tenancy estate is the right of survivorship.”  (Estate of Blair (1988) 199 Cal.App.3d 161, 166.)  Such an agreement does not exhibit an intent that defendant, though a joint tenant on legal title, would have no present interest. 

This intent is the opposite of the parties’ intent in Seabury v. Costello.  Rather than an agreement to only vest interest in the surviving co-tenant after the true beneficial owner dies, plaintiff alleges he had a present legal and beneficial interest in the property, then would gain a 100% interest if defendant predeceased him.  That is the very nature of joint tenancy.  These allegations thus show the parties intended to hold the property as joint tenants.  Such an intent is not a basis for imposing a resulting trust.

In his opposition, plaintiff relies on extrinsic facts not alleged in the complaint.  (Opp., p. 7.)  He asserts, “The parties’ intent was for Defendant Corrales to live at Fidel Ave for the purpose of Plaintiff Reyes taking care of him, since Defendant no longer wanted his father’s care, Fidel Ave should be completely and solely owned by Plaintiff Reyes, as was the intent of the parties.”  (Ibid.)  Plaintiff cites paragraph 37 of the complaint, which does not allege the parties intended defendant only would have an interest in the property so long as he lived there and plaintiff cared for him.  The opposition also asserts defendant “only contribut[ed] $5,000 to the downpayment.”  (Ibid.)  The complaint does not allege the amount defendant paid.  It only alleges both parties “contributed to the down payment.”  (¶¶ 2, 12.)  The court cannot consider facts not alleged in the complaint.

Disposition

            Defendant Hector Macias Corrales’s demurrer to plaintiff Victor Reyes’s first and third causes of action is sustained with 20 days’ leave to amend.