Alevy v. Dolores-Frances Affordable Housing
Filed 1/21/14 Alevy v.
Dolores-Frances Affordable Housing CA2/1
OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a),
prohibits courts and parties from citing or relying on opinions not certified
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8.1115(b). This opinion has not been
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION ONE
ALLEN E.
ALEVY,
Plaintiff and Respondent,
v.
DOLORES-FRANCES
AFFORDABLE HOUSING, L.P., et al.,
Defendants and Appellants.
B239110
(Los
Angeles County Super. Ct.
No.
BC428948, cons. w/BC432823)
PICO UNION HOUSING CORPORATION,
Plaintiffs and Appellants,
v.
ALLEN E.
ALEVY,
Defendant and Respondent.
APPEAL
from a judgment of the Superior Court of Los
Angeles County. Kevin Clement Brazile,
Judge. Affirmed in part, reversed in
part.
Lurie,
Zepeda, Schmalz & Hogan, Kurt L. Schmalz
and Shawn M. Ogle for Appellants Pico Union Housing Corporation and
Dolores-Francis Affordable Housing L.P.
Westland
Industries, Craig H. Missakian; Sragow & Sragow and Allen P. Sragow for Respondent
Allen E. Alevy.
________________________________
This
lot property known as Lot 20, which is adjacent to an apartment building on Lot 22 that is now owned by a non-profit
entity for use as low-income housing. The
owners of the apartment building and their predecessors believed that they held
title to the parking lot since they acquired the apartment building by
foreclosure in 1992.
But
no. It turns out that title to the two
properties diverged in the 1980’s, apparently arising from the previous owners’
inadvertent seven-year delay in recording one of the lots’ inclusion in an earlier
transfer of the properties.
As a result, owners of the
affordable-housing apartments on Lot 22 have believed since 1992 that they owned the adjacent Lot 20 parking lot as well. Unaware of the defect in their title, they paid
taxes on Lot 20, they have paid and discharged a loan that was secured by a
trust deed on both properties, and they have improved, maintained, and continued
to use the parking lot for the exclusive use and benefit of the apartment
building’s tenants.
In
2002, however, the plaintiff foreclosed on a 1988 encumbrance on Lot 20 (which due to the
earlier recording delay had been omitted from a
on the Lot 22 parcel). In 2009, the
plaintiff sued to quiet title to Lot 20.
The
defendants appeal from the trial court’s denial of summary judgment, and from
its judgment rejecting their claims to title to Lot 20 by adverse possession or
for an implied easement for its use as a parking lot for the benefit of the
tenants of the Lot 22 apartments. We affirm the
judgment with respect to adverse possession, but the judgment to the extent it
rejects the claim of an implied easement is reversed.
BACKGROUND
AND PROCEDURAL HISTORY
The Pleadings
Plaintiff
Allen E. Alevy is a sophisticated
and experienced real estate investor and owner of a real estate business
that owns and operates a great number of properties, such as shopping centers,
apartment buildings, and mobile home parks.
December 30, 2009, he filed case number BC428948 against defendant Dolores-Frances
Affordable Housing, L.P. (Dolores-Frances), seeking to quiet title and for related
relief with respect to a parking lot property at 1032 South Burlington Avenue,
known as Lot 20, in the Pico Union neighborhood of Los Angeles. Soon afterward, the Pico Union Housing
Corporation (Pico Union) filed case number BC432823 against Alevy, to quiet
title to Lot 20 and, in the alternative, for a prescriptive easement on it. The court appropriately consolidated the
related cases.
title="">[2]
Alevy
alleged in his December 30, 2009 verified complaint that since 1992 or 1993,
Pico Union and Dolores-Frances had “entered and exclusively encroached upon Lot
20,†by constructing concrete block walls and a metal guardrail, installing clicker-controlled
iron gates, and paving and striping the property for use as a parking lot. He alleged that since 1992 to 1993 the
control and use of Lot 20 by the owners of Lot 22 “has been continuous and always to the complete and total
exclusion of [Alevy and predecessor owners of Lot 20].†He alleged in addition that Dolores-Frances
and Pico Union “have maintained exclusive control and use of Lot 20 to their sole benefit by
enclosing and possessing Lot 20 to the complete exclusion of [Alevy and his predecessors] since Lot 22’s use of Lot 20 began in
1992/1993.†And he alleged that
Dolores-Frances and Pico Union had refused to relinquish their exclusion of
Alevy from Lot 20, but instead had asserted their acquisition of prescriptive
rights over Lot 20, “which was and remains totally enclosed by [Dolores-Frances]
and has been totally enclosed to the full exclusion of [Alevy] since
1992/1993.â€
title="">[3]
Pico
Union’s March
2, 2010 verified complaint alleged Pico
Union’s encroachment on Lot 20 to the exclusion of Alevy and others, beginning in 1992. Alevy’s answer admitted “that throughout
parts of 1992 and 1993 [Pico Union] entered and exclusively encroached upon Lot
20 to maintain the security gate and to use Lot 20 as parking for tenants at
[Lot 22] . . . .†Consistent with the
affirmative allegations of its own complaint, Alevy admitted that Pico Union
“occupied, controlled and used Lot 20 to the exclusion of others from its purchase of Lot 22 in 1992 until its
ownership of Lot 22 ended in 2004.†And it
admitted that Pico Union’s use of Lot 20 during that period was open and notorious.
Pico
Union’s complaint also alleged, in paragraph 19, that “[Pico Union] did not
have any discussions with Defendants [Alevy or his agents] regarding Lot 20 until 2002,
approximately ten years after Plaintiff began using Lot 20 as a parking lot.†And in paragraph 20, Pico Union alleged that
Pico Union “never requested or received permission from [Alevy or his agents]
to use Lot 20 as a parking lot or to construct and maintain any of the improvements
built upon Lot 20.†Alevy’s verified answer
admitted “the allegation of paragraph 19 of the Complaint that no oral
discussions occurred,†while denying paragraph 19’s “remaining
allegations.†His answer denied “the
allegations of paragraph 20,†affirmatively alleging that “Permission was
provided to Lot 22’s owners.â€
Denial
of Pico Union’s Motion for Summary Adjudication
After
the cases were consolidated, Pico Union moved for summary adjudication of its
causes of action for quiet title and declaratory relief. Its motion claimed that undisputed evidence
established each of the factual elements of its cause of action for adverse
possession of Lot 20, based on its “continuous and uninterrupted actual, open and
notorious possession†and payment of property taxes on Lot 20 “for at least five
consecutive years under a claim of right.â€
Alevy’s
response admitted the following relevant facts: that in May 1986 the CRA loaned $825,000 to
the then-owners of Lot 22; that in November 1988, the CRA foreclosed on its
security and acquired title to Lot 22; that in January 1992, the CRA sold Lot
22 to Pico Union to operate as low-income housing and for related commercial
uses; that Pico Union believed when it acquired the Lot 22 apartments that it
also had acquired ownership of Lot 20, “an adjacent parcel that had been
historically part of the Apartmentsâ€; that from sometime before Pico Union acquired
Lot 22 in 1992, Lot 20 had been enclosed, improved, and used and maintained as
controlled-access parking for tenants of the Lot 22 apartments; that Pico Union
posted a plaque on the front gate to Lot 20 stating: “Right to Pass by Permission and Subject to
Control of Owner Pico Union Housing Corp. §1008 Civil Codeâ€; that since 1992 Pico
Union has continuously and exclusively occupied, controlled and used Lot 20 as a
parking lot for Lot 22’s tenants, to the exclusion of others; and that Pico
Union has paid property taxes on Lot 20 directly or through its lender for the
five tax years from 1995/1996 through 1999/2000.
In opposition to summary adjudication, Alevy
also contended that he had at some time in 1993 or 1994 given permission to
someone he believed to be a representative of Pico Union, for Pico Union to use
Lot 20 as a parking lot; and that in any event, his status as a mere lienholder
during the relevant period precluded Pico Union’s claim of adverse possession
as a matter of law. And he denied
Pico Union’s claim that it “did not receive permission to use Lot 20 from Alevy.â€
The
trial court denied Pico Union’s summary adjudication motion. Its written explanation noted Alevy’s
acknowledgment that Pico Union’s use of Lot 20 had been open and notorious,
continuous and uninterrupted, and under a claim of right, and that Pico Union
had paid taxes on the property for a period of five years, constituting all of
the elements of a cause of action for adverse possession, except only the
element of “hostility.†But Alevy’s
evidence that he had granted Pico Union permission to use Lot 20 as a parking lot, the
court held, required denial of summary judgment because it showed that Pico
Union’s use of Lot 20 was not undisputedly hostile to Alevy’s interest in the property.
The Parties’
Pretrial Stipulation
The
parties entered into an extensive stipulation of issues, facts, exhibits,
witnesses, and other matters, including the following events:
1.
In March 1979,
the Yacoobians acquired the Lot 22 apartments and the adjoining Lot 20 from the Weingart Foundation, granting the Weingart Foundation a
trust deed on Lots 20 and 22 securing a debt of $318,750.
2.
In May 1981, the
Yacoobians sold Lot 20 and the Lot 22 apartments to an ownership group of approximately seven
couples. (The identity of the members of
the ownership group changed somewhat, in ways not relevant here, through a
number of transactions in March 1985, and again in May and June 1988.)
3.
In May 1986, the
California Redevelopment Agency (or the Los Angeles Community Development Fund (collectively,
CRA)) made a redevelopment loan of $877,943.05 to the then-owners of Lots 20
and 22, secured by a trust deed on Lot 22 only, but not on Lot 20.
4.
In May 1988, Alevy
obtained trust deeds on both Lots 20 and 22, as security for a loan of $400,000
to the joint owners of both lots. The
ownership group also granted Alevy an exclusive 30-year agency to manage both
properties on their behalf.
5.
In November 1988,
CRA obtained title to Lot 22 from the then-owners of both lots, through foreclosure on the
CRA’s 1986 lien.
title="">[6]
6.
In January 1992,
Pico Union obtained title to the Lot 22 apartments by grant deed from the CRA. (Pico Union believed at that time that it had
also acquired Lot 20, the adjacent parking lot; its Disposition And Sale
Agreement with the CRA had an attached site map showing both Lot 20 and Lot 22
as included in the sale.)
7.
In February 1992,
Pico Union began servicing the 1979 Weingart Foundation debt secured by both Lot 20 and Lot 22. Over the following years the Weingart
Foundation lien was transferred to the California Community Foundation, then to
a series of banks. In December 2003,
Pico Union finished paying off the debt, obtaining a full reconveyance of the
deeds of trust on Lots 20 and 22.
8.
Since 1992, Pico
Union has enclosed, improved, and continuously, openly, notoriously, and
exclusively occupied and possessed Lot 20 as a parking lot for tenants of Lot
22, to the exclusion of all others.
9.
Pico Union paid
the property taxes assessed on Lot 20 for the five tax years from 1995/1996
through 1999-2000.
10. In November 2002, Alevy obtained a trustee’s deed to
Lot 20 by foreclosure on his 1988 lien. (Alevy’s
lien on Lot 22, securing the same debt, had been extinguished in November 1988,
when the CRA obtained title to Lot 22 by foreclosure on its senior lien.)
11. In February 2004, Pico Union transferred title to the Lot 22 apartments to Dolores-Frances,
which since then has used the property as affordable housing and related
commercial uses, and has continued the use of Lot 20 exclusively as parking
for tenants of the Lot 22 apartments.
12. In December 2009, Alevy sued Dolores-Frances for quiet
title to Lot 20, and for related relief, and in March 2010, Pico Union sued
Alevy, in the now-consolidated actions leading to this appeal.
The
parties’ stipulation also identified the issues to be determined by the trial of
the consolidated cases. The first issue
was “[w]hether Pico Union’s possession of Lot 20 was hostile to the
then-owner’s title or whether Pico Union was given permission to use Lot 20 as
a parking lot.†They expressly
stipulated that Pico Union had satisfied all other elements of its claim for adverse
possession of Lot 20. The second issue to be
decided was whether, as a matter of law, the period of adverse possession ran
against Alevy, in light of his claim that until November 2002 his interest in Lot 20 was only a lien. The third issue to be tried was whether (if
Pico Union is found not to be the owner of Lot 20 by adverse possession) it has a prescriptive easement or implied
easement to use Lot 20 as a parking lot for the Lot 22 apartments.
name="_ftnref7" title="">[7]
The
stipulation expressly preserved Pico Union’s objection to Alevy’s testimony
about any oral discussions with Pico Union about Lot 20 before 2002, based on his
verified answer’s admission “‘that no oral discussions occurred.’â€
trial court expressly adopted the parties’ stipulations.
Relevant Evidence at Trial
Alevy
testified (over Pico Union’s objections) that in 1988 he had obtained a lien on
Lot 20
and Lot
22 from the properties’ then-owners.
agents of Pico Union—a short Hispanic lady who identified herself as “the
property management company†and a gentleman identified as the building
manager—at Lot 20 and the Lot 22 apartments; and that he orally offered Pico
Union permission to continue to use Lot 20 as a parking lot without cost, and told
them to keep the property clean. Since
then he had no further conversations with anyone at the property.
Alevy
testified that sometime after the meeting, on the advice of an attorney, he had
an employee (now deceased) “put four plaques into the ground,†saying “you can
cross over and we’ve given you permission.â€
Alevy saw his employee installing two of the plaques. Alevy offered the testimony of another
employee that in 2008, at Alevy’s direction, he looked for the four plaques but
was able to find only one (a photo of which was admitted as Exhibit 6), which
said, “Right To Pass By Permission And Subject To Control Of Owner. Section 1008, Civil Code.â€
Pico
Union presented the testimony of Pico Union’s CEO since 1986; the testimony of
the property manager for the Lot 22 apartments and Lot 20 since 1992; and the
testimony of the on-site manager for those properties from 1994 through 2004,
who had been the maintenance man for the Lot 22 apartments and Lot 20 parking
lot from 1992 to early 1994. These
witnesses each denied ever having met with Alevy in the 1990’s (or anytime
before the lawsuit), and testified that they had never received permission for
Pico Union’s use of Lot 20 from Alevy or anyone else.
Statement of Decision and Judgment
The
trial court entered judgment for Alevy. It credited Alevy’s trial testimony that
sometime in the early 1990’s he had told Lot 22’s managers that they could
continue to use Lot 20 as a parking lot for the benefit of Lot 21. It held that Pico Union’s possession of Lot 20 therefore was not hostile to
the interests of Lot
20’s then-owners. And it found that Pico Union did not obtain an
easement—whether implied, prescriptive, or equitable—for use of Lot 20 as a parking lot. In light of its decision on the adverse
possession issue, the court did not consider whether the period of adverse
possession would otherwise have run against Alevy’s lienhold interest in Lot 20.
DISCUSSION
On appeal Pico Union contends that
the trial court erred in entering judgment for Alevy, based on either of two
grounds. It contends first that its
adverse possession of Lot 20 for the five years from 1995 through 2000 would
have been established by uncontradicted evidence, were it not for the erroneous
admission of Alevy’s testimony that he had orally granted Pico Union permission
to continue using Lot 20 as a parking lot—contradicting his pleadings and
responses to requests for admission that he had no such conversation. Second, Pico Union contends that even if its
adverse possession claim fails, uncontradicted evidence shows that Pico Union was
entitled to an implied easement to use Lot 20 as a parking lot for the benefit of Lot 22’s tenants.
We conclude that Pico Union is not
entitled to reversal of the judgment’s denial of its claim for title to Lot 20 by adverse possession. However, the trial court erred by relying
upon erroneously admitting evidence when it denied the claim for an implied
easement for use of Lot 20 as a parking lot for the benefit of the tenants of
Lot 22, requiring reversal of that portion of the judgment.
A.
The Evidence
Does Not Sustain Pico Union’s Claim To Title By Virtue Of Its Adverse
Possession Of Lot 20.
Title by adverse possession is
established by proof of continuous, uninterrupted, open and notorious
possession of property under claim of right, adverse and hostile to the rights
of the true owner, and the payment of taxes assessed on the property for five
continuous years. (Civ. Code, § 1007;
Code Civ. Proc., § 321; West v. Evans (1946)
29 Cal.2d 414, 417; California Maryland
Funding, Inc. v. Lowe (1995) 37 Cal.App.4th 1798, 1803.) The parties stipulated that Pico Union had established
all of these elements of its cause of action for adverse possession of Lot 20
from the 1995/1996 through 1999/2000 tax years, except only the element of
“hostilityâ€â€”whether Pico Union’s exclusive possession of the property was
“hostile†to the interests of Lot 20’s title holders during that period.
Alevy disputed the element of
hostility on two grounds: first, that
sometime in the early 1990’s he had orally granted Pico Union permission to
continue using Lot 20 as a parking lot, rendering Pico Union’s possession
permissive and not hostile; and second, that as a matter of law, Pico Union’s
possession of Lot 20 could not be hostile or adverse to the nonpossessory
lienhold interest he held in Lot 20 before he obtained title (and a right to
possession) by foreclosure on his trust deed in 2002.
We conclude that under the
undisputed facts, Pico Union acquired a right to title to Lot 20 by adverse
possession as of 2000. But Pico Union nevertheless
is not entitled to judgment against Alevy.
Under the stipulated facts, Pico
Union’s ownership of Lot 20 arose from its adverse possession and payment of
taxes on Lot 20 for the five years from 1995 through 2000; the title it
obtained by adverse possession therefore was encumbered by the same trust deed
that had encumbered the title of Lot 20’s dispossessed owners: Alevy’s preexisting 1988 trust deed. The fact that Alevy’s trust deed was a
nonpossessory lienhold interest did not prevent Pico Union’s adverse possession
of Lot 20 from effectively ousting its then-record
owners from title; but Pico Union could gain by adverse possession no better
title than that of the owners it had dispossessed. Pico Union’s claim to Lot 20’s title by adverse
possession—like any other title subject to a preexisting lien—remained subject
to Alevy’s preexisting lien, and therefore was eliminated by Alevy’s
foreclosure in 2002.
1. The trial court’s determination that Pico Union’s possession
of Lot 20 was permissive and not hostile cannot be sustained; the evidence
that Alevy granted permission for Pico Union’s use of Lot 20 as a parking lot
was inadmissible.
Pico
Union’s use of the Lot
20 property, admittedly based on its mistaken belief in its title and right to
do so, raised a presumption that its use was hostile to the interests of its
owners and was not permissive. “When it
appears that the occupier enters the land mistakenly believing he is the owner,
possession is adverse unless it is established by substantial evidence that he
recognized the potential claim of the record owner and expressly or impliedly
reflected intent to claim the disputed land only if record title was determined
in his favor.†(Gilardi v. Hallam (1981) 30 Cal.3d 317, 326.) And even without this presumption, the CRA’s
possession of Lot
20 was unquestionably hostile to the ownership group’s title from the outset of
its acquisition of Lot
20’s title in 1988. Alevy testified that
in 1988 he told the CRA (apparently in his role as the properties’ exclusive
manager) that the CRA had not acquired title to the parking lot, and that
“you’re not going to get it and you don’t have parking and screw you.†Alevy’s uncontradicted testimony can only be
interpreted as a recognition that the use of the Lot 20 parking lot, by the CRA and
later by its grantee Pico Union, was adverse and hostile to ownership rights of
Alevy’s principals.
The burden therefore was Alevy’s to
present evidence sufficient to establish that Pico Union’s use of the property was
permissive, and therefore to overcome the contrary presumption arising from the
stipulated facts and the evidence of Pico Union’s use of the property to the
exclusion of its then-owners. (
Maryland Funding, Inc. v. Lowe, supra,
37 Cal.Appp.4th at pp. 1806-1807.) Pico
Union objected to the admission of any evidence on that issue, however, arguing
that Alevy’s verified answer constituted a judicial admission that Alevy had
not granted permission for Pico Union’s use of Lot 20. That objection was argued in connection with
the summary adjudication motion, it was recognized and preserved by the parties’
pretrial stipulations, and it was reiterated during the trial. On each occasion, the objection was
overruled.
In his verified answer to Pico
Union’s complaint, Alevy had admitted that “throughout parts of 1992 and 1993
[Pico Union] entered and exclusively encroached upon Lot 20 to maintain the
security gate and to use Lot 20 as parking for tenants at [Lot 22]â€; and that
Pico Union “occupied, controlled and used Lot 20 to the exclusion of others
from its purchase of Lot 22 in 1992 until its ownership of Lot 22 ended in 2004 . . . .†Pico Union’s complaint alleged in Paragraph
19 that “[Pico Union] did not have any discussions with Defendants [Alevy or
his agents] regarding Lot
20 until 2002, approximately ten years after Plaintiff began using Lot 20 as a parking lot.†And Alevy’s verified answer admitted “the
allegation of paragraph 19 . . . that no oral discussions occurred,†while
denying that paragraph’s “remaining allegations.†In addition, Alevy admitted under oath, in
answer to requests for admission, that he “did not assert any rights to enter Lot 20 from 1992 through 2001,†and
that he had been excluded from Lot 20 at all times after 1992.
Pico Union contends that these are
“judicial admissions†that are binding on Alevy, and are not subject to dispute
or contradiction by him. If that contention
is correct, these facts would establish beyond dispute that Alevy had no oral
discussions with Pico Union about Lot 20 before 2002, that Alevy had not
granted oral permission for it to use Lot 20, and that Alevy had not caused
plaques to be placed on Lot 20. These
facts, if established, would show that Pico Union’s use of Lot 20 was adverse and hostile to
Alevy’s ownership during the relevant period, entitling Pico Union to quiet
title by adverse possession as a matter of law.
Judicial admissions—admissions made
in a party’s pleadings, stipulations, or responses to requests for
admission—are “not merely evidence of the matter stated, but operate as ‘a
conclusive concession of the truth of [that] matter,’ thereby ‘removing it from
the issues.’ [Citation].†(Dang
v. Smith (2010) 190 Cal.App.4th 646, 657, italics omitted.) They “‘“may not be contradicted[] by the
party whose pleadings are used against him or her.â€â€™â€ (Myers
v. Trendwest Resorts, Inc. (2009) 178 Cal.App.4th 735, 746.) “‘When allegations in a complaint are
admitted by the answer (a) no evidence need be offered in their support; (b)
evidence is not admissible to prove their untruth; (c) no finding thereon is
necessary; (d) a finding contrary thereto is error.’ [Citation.]â€
(Valerio v. Andrew Youngquist
Construction (2002) 103 Cal.App.4th 1264, 1271; Evid. Code, § 350 [only
relevant evidence is admissible].)
But like all other statements, the
meaning of a judicial admission is not always clear and unambiguous. And when an admission is reasonably
susceptible to more than one meaning, the court must use its discretion to “‘to
elucidate and explain’†the admission, and to determine its scope and
effect. (Valerio v. Andrew Youngquist Construction, supra, 103 Cal.App.4th at p. 1273; Fredericks v. Kontos Industries, Inc. (1987) 189 Cal.App.3d 272,
278 [owner’s admission that contract required progress payments to contractor
did not preclude explanation that right to payments depended on work
performed].)
The issue here therefore is
straightforward: it turns on the extent
of the trial court’s discretion concerning the meaning of Alevy’s judicial admissions. If Alevy’s admissions are understood to mean
that Alevy denied having any discussions with representatives of Pico Union
regarding Lot 20 before 2002, and that the record owners of Lot 20 were
excluded from Lot 20 throughout the relevant period from 1995 through 2000, as
Pico Union argues they unambiguously do, then the trial court erred in
overruling Pico Union’s objections and admitting Alevy’s contrary testimony. If, on the other hand, the trial court
correctly exercised its discretion to determine that Alevy’s admissions were
susceptible to a meaning consistent with his explanatory testimony, its
admission of that testimony did not abuse its discretion.
The trial court permitted Alevy to
testify that sometime in the early 1990’s he and an employee (now deceased)
“met with the property manager†at the Lot 22 apartments and orally gave his
permission for Pico Union’s continued use of Lot 20 as a parking lot for the
tenants of its Lot 22 apartments, asking in exchange only that the lot be kept
free of debris and homeless encampments.
The conversation was with “the owner of the building,†described as a
short Hispanic lady and a gentleman identified as the building manager. The conversation took place by the back door
of the apartment building, “with the property management company and the
gentleman that worked for the property management company.â€
Alevy explained that he gave that
oral permission to Pico Union in order to free Lot 20’s record owners from worry
that the property might be subject to citation by the City, and to preclude any
claim of adverse possession. And the
court considered Alevy’s testimony corroborated to some degree by his further
testimony that either “at that meeting†or sometime thereafter he had
instructed his employee to place two or more plaques on the property, which said
that entry was by permission of the owners, pursuant to Civil Code section
1008.
Because Alevy’s in-court testimony
directly contradicted the unambiguous judicial admissions in Alevy’s verified pleadings
and answers to requests for admission, rather than simply explaining an
ambiguity, the trial court erred in admitting Alevy’s contrary testimony.
The issue is not whether the trial court
was justified in crediting Alevy’s testimony, but rather whether the testimony
was admissible at all. We do not
second-guess the trial court’s determinations of the credibility of admissible
testimony; but if Alevy’s testimony on this point was inadmissible, it cannot
be credited in the determination of the cause.
The trial court explained that it
concluded that Alevy’s testimony was admissible because the testimony did not
contradict Alevy’s judicial admissions. The
trial court found “there is no contradiction between the trial testimony and
the answer since the answer referred only to oral communications with
‘Plaintiff,’ which was defined in the complaint as [Pico Union] alone and did
not include the separate property management company with whom Alevy had his
conversation.†Therefore, when Alevy
admitted that he had no conversations with Pico Union regarding Lot 20 before 2002, he was admitting
only that he had no discussions with an
employee of Pico Union. The court
concluded that Alevy had not intended to admit that he had no discussion with non-employee
representatives of Pico Union such as its property managers.
But the trial court’s reasoning does
not bear scrutiny. The employment status
of the individuals with whom Alevy discussed permission, as employees or some
other sort of agents acting on Pico Union’s behalf, was of no consequence to
Alevy at the time, and is of no practical consequence here. Any discussions Alevy had with Pico Union
would necessarily have been with some agents or representatives of Pico Union;
as a corporation—an artificial entity—Pico Union could communicate only through
its human agents and representatives. (
Peepe Lumber Co. (1976) 63 Cal.App.3d 292, 295-296.) Moreover, in discussing Lot 20’s use as a
parking lot, Alevy had to have known he was dealing with agents of Pico Union,
whatever the identity of their immediate employer; dealing with Pico Union was
the very purpose of the discussion, he testified. As he said, his meeting with those
individuals was with “the owner of the building.â€
Not only did Alevy testify that he
believed that the individuals with whom he spoke represented Pico Union, but
that testimony was critical to his position.
Unless those individuals represented Pico Union, his conversation with
them could not possibly give Pico Union permission to use Lot 20. When he purportedly spoke to Pico Union’s
property manager at Pico Union’s Lot 22 apartment building about the use of the
Lot 20 parking lot for Lot 22’s tenants, Alevy had to have believed that he was
engaged in a discussion with Pico Union about the use of Lot 20—exactly the
discussion that he denied in his verified answer in case number BC432823. He could have been under no other illusion.
Alevy’s testimony also contradicts
the allegations of his own verified complaint in case number BC428948, that
ever since 1992 or 1993, Pico Union and Dolores-Frances had “exclusively
encroached upon Lot 20â€; that since 1992 to 1993 the control and use of Lot 20
by the owners of Lot 22 “has been . . . always to the
complete and total exclusion of [Alevy and his predecessor owners of Lot 20]â€;
and that Dolores-Frances and Pico Union have maintained exclusive control and
use of Lot 20 “to their sole benefit,†possessing Lot 20 “to the complete
exclusion of [Alevy and his predecessors]†since 1992/1993. These allegations cannot be reconciled with
his trial testimony that since 1991 or 1992, Pico Union’s use of Lot 20 has
been by permission from Alevy, and that his grant of permission to use Lot 20
for parking was given in part for the benefit of its owners, to protect them
from liability and responsibility to the City for the property’s cleaning and
maintenance.
Alevy’s testimony that his employee
placed plaques on Lot 20 also directly contradicts his admission that Pico
Union “occupied, controlled and used Lot 20 to
the exclusion of others†from 1992 to 2004, as well as to his admission in
answer to requests for admission, that he had been excluded from Lot 20 from
1992 through the present, and that he “did not assert any rights to enter Lot
20 from 1992 through 2001.†(Italics
added.) His testimony about the
placement of plaques on the property at his direction purports to constitute
evidence that Pico Union did not
exclude him (through his employee) from the property, and that
Alevy’s testimony on these subjects
therefore was inadmissible. Without it,
the record cannot sustain the trial court’s determination, expressly in
reliance on that inadmissible evidence, that Pico Union’s use of Lot 20 as a parking lot was
permissive and not hostile to the interests of its then-owners.
2.
Alevy’s
nonpossessory lienhold interest in Lot 20 was unaffected by
Pico Union’s acquisition of Lot 20 by adverse possession.
The fact that until 2002 Alevy had
no more than a nonpossessory lienhold interest in Lot 20 did not prevent Pico Union’s
adverse possession of Lot
20 from effectively ousting its then-owners from title; but Pico Union could gain
by adverse possession no greater title than that of the owners it had
dispossessed. Pico Union’s claim to
title by adverse possession—like any other title subject to a preexisting
lien—was eliminated by Alevy’s foreclosure on his preexisting lien in 2002.
The doctrine of adverse possession
applies only to possessory estates; but Alevy’s interest in Lot 20 during the 1995 through 2000
period, represented by his 1988 trust deed encumbering the property, was not a
possessory estate. Pico Union’s possession
of Lot 20 therefore was hostile to the
possessory interests of Lot
20’s then-titleholders, but did not infringe on any rights Alevy held as a
nonpossesory lienholder.
“To be considered hostile, the acts
relied upon must operate as an invasion of the right of the party against whom
they are asserted.†(
209 Cal. 105, 133.) Pico Union’s
possession of Lot
20 did not invade Alevy’s rights as a lienholder; therefore it was not adverse
or hostile to Alevy’s interest in the property.
(Laubisch v. Roberdo (1954) 43
Cal.2d 702, 706-707 [prescriptive period of statute of limitations does not
begin to run against purchaser at sheriff’s sale until the sheriff’s deed is
delivered to purchaser]; Leonard v. Flynn
(1891) 89 Cal. 535, 542 [same]; Comstock
v. Finn (1936) 13 Cal.App.2d 151, 157-158 [possession is not adverse or
hostile to nonpossessory interest in property].)
Pico Union’s five years of exclusive
use and possession of Lot
20 between 1995 and 2000 established its claim to title, after 2000, superior
to that of Lot 20’s then-record owners. This is confirmed by the reasoning applied in
Tobin v. Stevens (1988) 204
Cal.App.3d 945. In that case, the
plaintiff sought quiet title to a parcel based on a 1985 grant deed from the
record owner. The Court of Appeal denied
the claim, however, reasoning that the defendant’s possession of the property
for more than ten years before the action was filed would (if he paid the
assessed taxes) entitle him to prevail against the grantee from the record
owner. The period of adverse possession
runs against the owner (or owners) of title, notwithstanding any transfers of
that ownership during or after the period of adverse possession. (Id.
at p. 953; Sevier v. Locher (1990) 222
Cal.App.3d 1082, 1084 [“Adverse possession refers to occupation or use of land
adverse to legal title, not to a particular holder of legal titleâ€].)
At the end of its five-year period
of adverse possession of Lot
20 in 2000, therefore, Pico Union’s right to the property had vested. No voluntary transfer of title by the record
owners during or after that period, to Alevy or to anyone else, could interrupt
the continuity of Pico Union’s adverse possession, or impair Pico Union’s right
to title. (Yorba v. Anaheim Union Water Co. (1953) 41 Cal.2d 265, 270
[prescriptive period continues to run against title owners and their successors
in interest until statute is tolled by filing of action that finally
adjudicates right to title].)
But Pico Union’s adverse possession
of Lot 20 could not result in title
superior to that held by Lot
20’s owners at the outset of the adverse possession. The long-established underlying principle is
that “[t]he new title thus acquired by the disseizor must of necessity
correspond with that on which the disseizen operated, as he could not acquire
by disseizen a greater estate than that held by the disseizee.†(Williams
v. Sutton (1872) 43 Cal. 65, 73.)
Acts affecting the title and
security interest held by the trustee of a trust deed are unaffected by acts of
the owner subsequent to the trust deed.
(Homestead Savings v. Darmiento
(1991) 230 Cal.App.3d 424, 437 [interest of successor to trustor of trust deed
is subordinate to earlier-recorded trust deed]; see Dover Mobile Estates v. Fiber Form Products (1990) 220 Cal.App.3d
1494, 1498 [title obtained by trustee’s deed on foreclosure relates back to
execution of trust deed]; Sain v.
Silvestre (1978) 78 Cal.App.3d 461, 471 [purchaser at foreclosure acquired
title free of equitable servitudes recorded after recording of trust deed]; 4
Witkin, Summary of Cal. Law (10th ed. 2005) Security Transactions in Real
Property, § 169, p. 970 [“On the trustee’s sale of the property [following
foreclosure], the purchaser acquires the trustor’s interest in the property as
of the date that the deed of trust was originally executedâ€].)
Alevy’s 1988 trust deed encumbered Lot 20 before Pico Union’s adverse
possession began, and Pico Union’s subsequent possession of Lot 20 was not hostile to Alevy’s lienhold
interest. (12 Witkin, Summary,
275-276 [possession is not hostile to rights of mortgagee until delivery of
deed upon foreclosure]; 4 Witkin, Summary, supra,
Security Transactions in Real Property, § 170, p. 971; Comstock v. Finn, supra,
13 Cal.App.2d at p. 157.) The title Alevy
obtained in 2002 arose from his right to foreclose on the owner’s interests when
they granted the trust deed in 1988, not from succession to the interest they
held after they had ceded their possessory rights to Pico Union.
This
result does not contradict the early decision of our Supreme Court in
does. In Le Roy, the plaintiffs’ assignor, Leese, had obtained title to the
property by patent in March 1858. Leese
mortgaged the property to Vallejo; the mortgage was foreclosed in 1860; and title to the property was
conveyed to Vallejo’s assignees in 1862. In the
meantime, from 1858 until January 1864, Rogers’ grantors (along
with others) were in adverse possession of the property. As of March 1858, Leese therefore had a right
to oust Rogers from possession. “The
Statute of Limitations, therefore, commenced to run at that date, and the
plaintiffs’ action, which was commenced in August, 1864, was barred, unless
something has intervened to prevent the running of the statute.†(Le Roy,
supra, 30 Cal. at p. 233.)
The
key holding of the Le
plaintiffs obtained by grant is no greater than the interest of their grantor
at the time of the grant—a principle that is wholly consistent with that
affirmed in this case. On that basis the
court held in Le Roy
that Rogers’ adverse possession of the property was unaffected by an
intervening action to which Rogers was not a party, in which Leese’s assignees
had sought and obtained judgment for possession as against others. As purchasers at a
foreclosure sale, Leese’s assignees obtained “the estate that the mortgagor
had,†as though “the mortgaged premises been conveyed directly by the
mortgagor, instead of indirectly and through the operation of a judicial sale. He does not differ in this respect from one
who purchases at an official sale, made in satisfaction of a judgment lien.†(Id.
at p. 236.)
Pico
Union contends that the Le Roy
decision stands for the proposition that the interest obtained by an adverse
possessor (in that case, Rogers) is unaffected by a sale of the property upon foreclosure of a
mortgage. But Le Roy did not decide that proposition. In Le
Roy, the period of adverse possession apparently had commenced before
Leese’s mortgage to Vallejo; nothing in the decision indicates otherwise. Consistent with that case (and with the case
at hand), the lien granted after the adverse possession had commenced did not
break the period of adverse possession, and did not affect the title obtained
by it.
The
rule of the Le Roy decision thus is
that the interest obtained by the adverse possessor is no greater than that
held by the title owner when the adverse possession commenced; and by the same
token, the title obtained by purchase at a foreclosure sale is the interest
held by the owner when the property was encumbered. (Le
Roy, supra, 20 Cal. at p. 235
[prescriptive period accrues against title as of commencement of prescriptive
period]; Sevier v. Locher,
when Pico Union’s adverse possession commenced in 1995; the title resulting
from Pico Union’s adverse possession therefore was subject to the same
preexisting encumbrance.
3.
The title
resulting from Alevy’s 2002 foreclosure superseded the title Pico Union had
earlier obtained by adverse possession.
When Alevy foreclosed on his 1988 trust
deed in 2002, all junior encumbrances were eliminated. (Metropolis
Trust & Sav. Bank v. Barnet (1913) 165 Cal. 449, 455 [sale of property upon
foreclosure of trust deed extinguishes mechanic’s lien filed after trust deed’s
execution, vesting absolute title in purchaser at foreclosure sale];
[purchaser at sale under deed of trust becomes owner of the property free from
lien of all subsequent encumbrances]; Civ. Code, § 2903 [person with interest
in property subject to a lien may redeem it from the lien, until the right of
redemption is foreclosed]; 4 Witkin, Summary, supra, Security Transactions in Real Property, § 213, p. 1031.)
Alevy’s delay until 2002 in
exercising his power of sale, and until 2009 in seeking quiet title to Lot 20, could not give rise to an
untimeliness defense. The lien of a deed
of trust remains enforceable by a power of sale until 60 years after
recordation of the trust deed, unless the final maturity date or last date
fixed for payment of the debt can be ascertained from a recorded document (not
apparent in this case). (Civ. Code, §
883.020, subd. (a); Nicolopulos v.
Superior Court (2003) 106 Cal.App.4th 304, 310.) Alevy therefore apparently had until the year
2048 to exercise and enforce the power of sale in his 1988 trust deed. Nor could the doctrine of laches be applied,
particularly where Pico Union apparently could claim no prejudice apart from
having to discharge the outstanding debt that the lien secured. (Id. at
p. 312.)
The 1988 trustee’s deed recites that
all required notices of default and sale were duly given, and other documents
indicate that Pico Union had notice that Alevy was exercising his power of sale
with respect to Lot
20. But in any event, a trustee’s sale may
be voidable for a defect in notice only if payment of the secured debt is
tendered. (Leonard v. Bank of America (1936) 16 Cal.App.2d 341, 346; 4 Witkin,
Summary, supra, Security Transactions
in Real Property, § 152, p. 950.)
name="_ftnref10" title="">[10]
Until Alevy purchased title at the
foreclosure sale, Pico Union had the right to redeem Lot 20 from Alevy’s lien. (Civ. Code, § 2903.) But Alevy’s acquisition of the property by
trustee’s deed upon his power of sale eliminated Pico Union’s right to claim title
to Lot 20 by virtue of its earlier-perfected
adverse possession.
B.
The Trial
Court’s Determination That Lot 20 Is Not Burdened By An Implied Easement Cannot Be Sustained.
Pico Union contends that even
without adverse possession, an easement for the continued use of Lot 20 as a parking lot for the benefit
of Lot 22’s tenants arose by
implication, by virtue of the parcels’ long, obvious, and apparently permanent
use by their common owners in that manner before the parcels’ ownership
diverged. The trial court rejected that
claim.
The circumstances under which the
law implies the existence of such an easement are set forth in Civil Code
section 1104: “A transfer of real
property passes all easements attached thereto, and creates in favor thereof an
easement to use other real property of the person whose estate is transferred
in the same manner and to the same extent as such property was obviously and
permanently used by the person whose estate is transferred, for the benefit
thereof, at the time when the transfer was agreed upon or completed.†This provision “creates an implied easement as
an exception to the general rule that interests in real property can only be
created by an express writing or by prescription [citations].†(Kytasty
v. Godwin (1980) 102 Cal.App.3d 762, 768-769.)
“‘When the owner of lands divides
his property into two parts, granting away one of them, he is taken by
implication to include in his grant all such easements in the remaining part as
are necessary for the reasonable enjoyment of the part which he grants, in the
form which it assumes at the time he transfers it. The purchaser is entitled to the benefit of
the easement without any express grant or reservation.’†(A.
Hamburger & Sons, Inc. v. Lemboeck (1937) 20 Cal.App.2d 565, 569.) “‘If the owner’s use of the “quasi servient
tenement†has continued for a period of time in an obvious and permanent
manner, a division of his title implies that the parties intended to transfer
the obvious burdens and benefits with the property conveyed. Therefore, if the owner conveys the “quasi
dominant tenement,†the grantee receives an implied easement for the use and
benefit of his property over the “quasi servient tenement†retained by the
owner-grantor.’†(Horowitz v. Noble (1978) 79 Cal.App.3d 120, 131-132.) “‘The parties are presumed to contract in
reference to the condition of the property at the time of the sale, and neither
has a right, by altering arrangements then openly existing, to change
materially the relative value of the respective parts.’†(Id. at
p. 132.)
The law will imply the existence of
an easement when the following conditions exist: First, there has been a divergence of title
to properties or portions of a property that were under common ownership. Second, before the divergence in ownership, the
common owner of both parcels or portions of the property had made such obvious
and apparently permanent use of one portion for the benefit of the other, such
that the parties to the transaction must have known and intended or believed
that its use in that manner would continue after the divergence in the parcels’
ownership. Third, the easement that is implied
from these circumstances—for the continued use of one portion of the property
for the benefit of the other—is reasonably necessary to the use and benefit of
the portion that is claimed to be the dominant tenement. (Tusher
v. Gabrielsen (1998) 68 Cal.App.4th 131, 141.)
The trial court concluded that Pico
Union’s claim to an implied easement was defeated by Alevy’s claimed placement
of plaques on Lot
20, stating “I think plaintiff’s contention of an implied easement is barred by
Civil Code section 1008,†and “I think placement of the plaques defeats any
claim of an implied easement. Its statement
of decision expressed a number of additional grounds for rejection of the
implied easement theory. It concluded
that because the common ownership of Lots 20 and 22 had diverged in December
1988, when the CRA foreclosed on its lien on Lot 22, “it is impossible to say
that the owners ‘intended’ to grant [the CRA] an easement†for Lot 20’s use as
a parking lot. It found also that because
the Lot 22 apartments had been vacant for
about two years during the properties’ restoration after the CRA’s late-1988 acquisition
of title, “the ‘dominant’ Lot
22 estate did not continue its parking use for a significant period of time†after
the divergence in the parcels’ ownership.
And the court found that the use of Lot 20 as a parking lot “was never
‘reasonably necessary’ to use of the Apartments,†as evidenced by the break in
use as a parking lot during the properties’ restoration and the fact that there
were fewer parking spaces on Lot 20 than apartments on Lot 22. But “[i]n particular,†the court explained, Pico
Union’s claim to an implied easement is defeated because “the installation of
the plaques at the subject property along with the owners’ consent to use the
property defeats all claims for an easement.â€
We conclude that the trial court’s
rulings on this issue cannot be sustained.
We reverse the trial court’s rejection of the implied easement claim,
not because the evidence
necessarily
establishes the existence of an implied easement, but because the court’s rejection
of that theory rests on erroneous rulings and assumptions, requiring
redetermination of the issue.
The following is the relevant
sequence of events:
In May 1986, the Community
Development Fund (CDF) loaned $877,943.05 to the owners of Lots 20 and 22, for
the properties’ rehabilitation and restoration. As a result of error, the encumbrance securing
that loan was mistakenly placed only on Lot 22, but not on Lot 20.
Throughout that period (and since
much earlier) the lots had been commonly owned, and Lot 20 had been used as a parking lot
for tenants of Lot
22. As of June 1988, both Lot 20 and Lot 22 were owned by a group
consisting of eight individuals and a corporation.
owners group, receiving a trust deed encumbering both lots and taking over
management of the properties’ ongoing restoration.
Alevy was unable to complete the Lot 22 apartments’ rehabilitation,
however. In December 1988, the CDF took
title to Lot 22 by foreclosure, later transferring
title to the CRA. Title to Lot 20 remained in the ownership group,
subject to Alevy’s mid-1988 lien; Alevy’s encumbrance on Lot 22 was extinguished by the CRA’s
foreclosure on its senior lien. The CRA
transferred Lot
22 to Pico Union in January 1992, after completing the rehabilitation and
restoration of both properties for use as apartments, and adjoining parking, for
low-income tenants.
The trial court reasoned that,
because the divergence in title had resulted from foreclosure of the 1986 trust
deed (which encumbered only Lot 22), it would be “impossible†to conclude that
the parties had intended that Lot 20 would continue to be used as a parking lot
for the use of Lot 22’s tenants. But the
fact that the divergence ownership resulted from foreclosure rather than
voluntary conveyance does not preclude the implication of an easement when the
circumstances identified in Civil Code section 1104 exist.
Civil Code section 1104 defines the
conditions that give rise to an implication of the parties’ intention that the
land be subject to a servitude, even when such an intention is not
expressed. (Kytasty v. Godwin, supra,
102 Cal.App.3d at pp. 768-769.) Here, Lot 20 had long been used by the
parcels’ common owners as a parking lot for the benefit of the tenants of the Lot 22 apartments. The record contains no indication that anyone—either
the owners or Alevy—had any intention that the use of Lot 20 as a servient or
quasi-servient tenement should or would change in the foreseeable future, or that
Lot 20 would (or could) be devoted to any other appropriate use.
An easement that is appurtenant to
the land but is unmentioned in a conveyance can nevertheless burden a property
when it is conveyed. “A purchaser of
property is bound to take notice of all easements or servitudes which are
‘apparent’ upon inspection of the property.â€
(Kytasty v. M.F. Goodwin,
authorized by Civil Code section 1104 is reciprocal; hence, if a burden has
been imposed upon a parcel of land sold, the purchaser, provided the marks of
this burden are open and visible, takes the property with the servitude on it [citations].â€
(Id.
at p. 770; Horowitz v. Noble,
takes title subject to obvious benefits and burdens].)
That principle applies to one who
obtains an encumbrance on property no less than to one who purchases title
outright. When Alevy obtained trust
deeds encumbering Lots 20 and 22, he was the properties’ exclusive manager and
was aware of Lot
20’s use as a parking lot for use by the Lot 22 tenants. To the extent these known circumstances give
rise to an implied easement appurtenant to the property, the trust deed he
obtained in mid-1988 therefore was a lien on “the property with the servitude
on it.†(Kytasty v. M.F. Goodwin, supra,
102 Cal.App.3d at p. 770.)
The same is true when the CRA encumbered
Lot 22 in 1986. The obvious and apparently permanent use to
which the parcels had long been put by their common owners was sufficient to indicate
that appurtenant to Lot 22 was a quasi-easement for Lot 20’s use as a parking lot—a
servient tenement to which a purchaser at foreclosure would be entitled. (A.
Hamburger & Sons v. Lemboeck, supra,
20 Cal.App.2d at p. 568 [purchaser of dominant tenement at foreclosure sale
acquires implied easements on property]; see also Bartholomae Corp. v. Scott W.B.
Inv. Co. (1953) 119 Cal.App.2d 41, 44 [transfer of interest in property
passes all easements, unless expressly excepted]; St. Louis v. DeBon (1962) 204 Cal.App.2d 464, 466 [Easement that is
appurtenant to the property will pass with land conveyed without specific
mention]; Civ. Code, § 2926 [mortgage “is a lien upon everything that would
pass by a grant of the propertyâ€]; 4 Witkin, Summary of Cal. Law (10th ed.
2005) Security Transactions in Real Property, § 169, p. 970 [“On the trustee’s
sale of the property [following foreclosure], the purchaser acquires the
trustor’s interest in the property as of the date that the deed of trust was
originally executedâ€].)
This treatment of appurtenant
easements is consistent with the manner in which the law treats leasehold
interests and fixtures that are appurtenant to mortgaged property. In Trask
v. Moore (1944) 24 Cal.2d 365, 368, for example, the plaintiff had a trust
deed encumbering four parcels of property, including “all appurtenances including
water rights.†(Id. at p. 367.) Following
the placement of this encumbrance, the properties and water rights were sold to
others, who disconnected the water distribution system and redirected the water
from the properties’ pumps to other property.
Upon the plaintiff’s foreclosure, the Supreme Court affirmed the trial
court’s order that the defendants reconnect the water distribution system, holding
that the system had functioned as part of an integrated system when the
plaintiff had received its encumbrance on the lots. “By being so joined and essential to the
function of the apparatus as a whole, the distributing system contained and
combined in itself all of the elements and attributes of a fixture or
appurtenance to real estate.†(
thing is deemed to be incidental or appurtenant to land when it is by right
used with the land for its benefit . . . .â€].) As such, the distributing system passed with
the encumbered parcels. (See also
(1894) 104 Cal. 420, 426-427 [fixtures in place when leased property is
mortgaged are subject to sale upon the mortgage’s foreclosure].)
Formal title to both Lot 20 and Lot
22 remained in the ownership group until late 1988; however it was in 1986,
before Alevy’s lien on the properties, that the ownership group conveyed to the
CRA an interest in Lot 22—a conveyance that arguably carried with it a
quasi-easement burdening Lot 20’s use. (Civ. Code, § 2926; U.S. v. Real Property at 2659 Roundhill Dr., Alamo, Cal. (9th Cir.
1999) 194 F.3d 1020, 1026 [Under California law, interest of purchaser at
foreclosure proceeding relates back to time the deed of trust was recorded];
see Hohn v. Riverside County Flood
Control and Water Conservation Dist. (1964) 228 Cal.App.2d 605, 613; Miller
& Starr, Cal. Real Property, Deeds of Trust, § 10:208, pp. 665-666
[purchaser at foreclosure sale has same priority as trust deed].)
It is on this basis that we conclude
that the divergence in title between Lots 20 and 22 is a sufficient basis for the
implication of an easement, entitling Lot 22 “to use other real property of the
person whose estate is transferred [i.e., Lot 20] in the same manner and to the
same extent as such property was obviously and permanently used by the person
whose estate is transferred [the ownership group], for the benefit [of Lot 22],
at the time when the transfer was agreed upon [i.e., when it was encumbered in
1986] or completed [when the trust deed was foreclosed in late 1988].†(Civ. Code, § 1104.)
The trial court’s ruling that Pico
Union’s claim of an implied easement was defeated by the evidence that Alevy
had consented to its use of Lot 20 as a parking lot for Lot 22’s tenants is
fatally infected by its express reliance for that conclusion on the erroneously
admitted evidence of Alevy’s compliance with Civil Code section 1008 and his consent
to Pico Union’s use of Lot 20. Civil
Code section 1008 applies to the creation of easements by prescription; it does
not purport to apply to easements that arise by implication under Civil Code
section 1104. Moreover, even if the
evidence of Alevy’s purported consent had been admissible and could be
credited, it could not defeat the existence of the implied easement sought
| Description | This appeal concerns ownership of a parking lot property known as Lot 20, which is adjacent to an apartment building on Lot 22 that is now owned by a non-profit entity for use as low-income housing. The owners of the apartment building and their predecessors believed that they held title to the parking lot since they acquired the apartment building by foreclosure in 1992. But no. It turns out that title to the two properties diverged in the 1980’s, apparently arising from the previous owners’ inadvertent seven-year delay in recording one of the lots’ inclusion in an earlier transfer of the properties. As a result, owners of the affordable-housing apartments on Lot 22 have believed since 1992 that they owned the adjacent Lot 20 parking lot as well. Unaware of the defect in their title, they paid taxes on Lot 20, they have paid and discharged a loan that was secured by a trust deed on both properties, and they have improved, maintained, and continued to use the parking lot for the exclusive use and benefit of the apartment building’s tenants. In 2002, however, the plaintiff foreclosed on a 1988 encumbrance on Lot 20 (which due to the earlier recording delay had been omitted from a Community Redevelopment Agency (CRA) foreclosure on the Lot 22 parcel). In 2009, the plaintiff sued to quiet title to Lot 20. The defendants appeal from the trial court’s denial of summary judgment, and from its judgment rejecting their claims to title to Lot 20 by adverse possession or for an implied easement for its use as a parking lot for the benefit of the tenants of the Lot 22 apartments. We affirm the judgment with respect to adverse possession, but the judgment to the extent it rejects the claim of an implied easement is reversed. |
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