Markowitz v. Markowitz

Filed 8/24/09 Markowitz v. Markowitz CA2/4

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FOUR

APPEAL from a judgment of the Superior Court of Los Angeles County, Aurelio Munoz, Judge. Affirmed.

Edwin B. Stegman for Defendant and Appellant.

Timothy D. McGonigle, a Professional Corporation, and Timothy D. McGonigle for Plaintiff and Respondent.

introduction

In this action for declaratory relief, a court trial resulted in a judgment in favor of Donald J. Markowitz (Donald) and against Debra W. Markowitz (Debra), (formerly husband and wife). Donald and Debra were plaintiffs and cross-defendants in two consolidated lawsuits against Mordechai and Monica Kachlon, which resulted in a money judgment being entered in favor of Donald and Debra, though they received separate awards, in different amounts. Shortly after judgment was entered, Debra recorded an abstract of judgment, thereby creating a judgment lien on the Kachlons real property; Donald later recorded abstracts of judgment (one against each of the Kachlons), thereby also creating a judgment lien on the Kachlons real property. Donald then filed the present action for declaratory relief, by which he sought and obtained a judicial declaration that his judgment lien had equal priority with Debras based upon Code of Civil Procedure section 697.020, subdivision (b), which provides that a judgment lien recorded on the same property under the same judgment relates back to the date [an] earlier lien was created.

Debra argues on appeal, as she did in the trial court, that the underlying consolidated lawsuit resulted in separate judgments, and that therefore Code of Civil Procedure section 697.020, subdivision (b) does not apply. Thus, because her lien was recorded first, it has priority over Donalds. We conclude that there was a single judgment, and that the plain meaning of the statute compels the result reached by the trial court. We therefore affirm the judgment.

factual and procedural background

The Judgment, and the Creation of the Judgment Liens

Judgment was entered on February 3, 2005, against Mordechai Kachlon (Mordechai) and Monica Kachlon (Monica), awarding $368,087.50 in favor of Donald, and $40,000 in favor of Debra. On February 11, 2005, Debra recorded an abstract of judgment, referring to the judgment entered February 3, 2005. Debra also recorded the judgment itself on February 16, 2005.

Following resolution of posttrial motions, on March 30, 2005, the court entered an amended judgment, nunc pro tunc, awarding Donald $415,936.86, and awarding Debra $96,622.

On April 4, 2005, Donald recorded two separate abstracts of judgment, one against Mordechai in the amount of $415,936.86, and the other against Monica in the amount of $314,056.86. The abstracts referred to the March 30, 2005 nunc pro tunc order.

On May 18, 2005, Debra recorded an amended abstract of judgment, attaching a certified copy of the amended judgment.

The Present Action for Declaratory Relief

Donald filed the present action for declaratory relief on May 8, 2007. Donald alleged that an actual controversy had arisen between him and Debra with regard to their respective rights and duties under the recorded abstracts of judgment filed by each of them. He sought a judicial declaration that (1) the abstract of judgment filed by Debra on February 11, 2005, created a lien for the total amount of the February 3, 2005 judgment, not just Debras portion of the judgment (citing Code Civ. Proc.,  697.350, subd. (a) and 695.210);^[1](2) pursuant to section 697.020, subdivision (b), when Donald recorded his abstract of judgment on April 4, 2005, the lien created thereby related back to February 11, 2005, the date on which Debra recorded an abstract of judgment; and (3) Debra did not have priority in collecting the judgment by way of executing on Mordechais and Monicas real property, and that for each dollar collected, Donald and Debra were required to share in the same ratio as they shared in the amount awarded in the amended judgment, 81.15 percent to Donald, and 18.85 percent to Debra.

The Demurrer

Debra filed a demurrer to Donalds complaint, arguing that the complaint failed to state a cause of action because purportedly well-established authority provided for one judgment per party, not one judgment per action. Donald filed opposition.

The trial court overruled the demurrer.

The Court Trial and the Judgment

The parties stipulated to the facts, essentially as recited above.

A court trial was held on March 10, 2008. Counsel for Debra informed the court, and later filed a declaration to the same effect, that Donald had executed onreal property owned by Mordechai and Monica in August 2007, and the property sold for $205,000. Donald had retained the entire proceeds of the sale.

The court entered judgment in favor of Donald on April 7, 2008. Specifically, the court found that, when Debra recorded an abstract of judgment on February 11, 2005, a lien was created against the real property of the Kachlons for the total amount of the judgment as entered. The total amount of the judgment included the separate awards to Donald and Debra. Thus, the amount of the lien created on February 11, 2005 included the sums awarded to Donald in addition to the sums awarded to Debra. In addition, when Donald recorded his abstracts of judgment on April 4, 2005 as to Mordechai and Monica, [b]oth abstracts relate[d] to the same judgment referenced in the abstract recorded by Debra on February 11, 2005[, and] [a]s such, under [section] 697.020(b), the priority of the liens created on April 4, 2005 relate back to February 11, 2005. The court continued: By virtue of their respective recorded abstracts, as of February 11, 2005, Donald [and] Debra each received a lien against the real property of Mordechai Kachlon and Monica Kachlon for the full amount of his or her portion of the Judgment. Donald and Debra were (and are) concurrent lien-holders. Based on recording their respective abstracts, neither Debra nor Donald have (or had) lien priority over one another.^[2]

Regarding the August 2007 execution sale of the Kachlons property, the court found that the sale affected only that portion of the lien Donald had on said real property relating to his portion of the Judgment. Said sale did not extinguish, diminish or affect any portion of the lien that Debra has on said real property relating to her portion of the Judgment.^[3]

This timely appeal followed.

discussion

I. Propriety of Declaratory Relief

Debra first argues that Donald failed to state a cause of action for declaratory relief because there was no actual controversy to be decided. Rather, Donald was merely seeking an interpretation of long-established statutory and case law regarding priority of judgment liens on real property. Because the parties stipulated to the relevant facts, Debra contends that the matter involved only a dispute regarding the interpretation of relevant law, and therefore declaratory relief was improper. Debra misunderstands the nature of declaratory relief.

Code of Civil Procedure section 1060 provides: Any person . . . who desires a declaration of his or her rights or duties with respect to another . . . may, in cases of actual controversy relating to the legal rights and duties of the respective parties, bring an original action . . . in the superior court . . . . (Italics added.) Thus, declaratory relief is appropriate only where there is an actual controversy, not simply an abstract or academic dispute. [Citations.] (Connerly v. Schwarzenegger (2007) 146 Cal.App.4th 739, 746 (Connerly).) The actual controversy language in Code of Civil Procedure section 1060 encompasses a probable future controversy relating to the legal rights and duties of the parties. [Citation.] For a probable future controversy to constitute an actual controversy, however, the probable future controversy must be ripe. [Citations.] A controversy is ripe when it has reached, but has not passed, the point that the facts have sufficiently congealed to permit an intelligent and useful decision to be made. [Citation.] [] Whether a claim presents an actual controversy within the meaning of Code of Civil Procedure section 1060 is a question of law that we review de novo. (Environmental Defense Project of SierraCounty v. County of Sierra (2008) 158 Cal.App.4th 877, 885, italics added.) (County of San Diego v. State of California (2008) 164 Cal.App.4th 580, 606.) Particularly where, as here, the underlying facts are undisputed, in reviewing the propriety of the trial courts decision, we are confronted with questions of law. (Dolan-King v. Rancho Santa Fe Assn. (2000) 81 Cal.App.4th 965, 974.)

Donalds lawsuit presented an actual controversy because Donald and Debra both hold judgment liens on the Kachlons real property, and the priority of those liens is at issue. In fact, Donald had already levied a writ of execution on real property owned by the Kachlons, and had collected money from the sale of the property (though less than the amount of the judgment in his favor). Thus, the dispute over the priority of Donalds and Debras liens was not merely an abstract or academic dispute on a point of law. (Connerly, supra, 146 Cal.App.4th at p. 746.) To the contrary, the controversy was ripe, in that the facts [had] sufficiently congealed to permit an intelligent and useful decision to be made. [Citation.] (City of Santa Monica v. Stewart (2005) 126 Cal.App.4th 43, 59.)

Debra argues that there was no actual controversy because the applicable law was already settled in her favor. As we explain below, she is incorrect on the law. In any event, her argument misconceives the actual controversy requirement for declaratory relief. That the law might require a decision on a dispute in one partys favor does not mean that there is no actual controversy ripe for declaratory relief.

Likewise, Debra misses the mark in contending that declaratory relief was not available because the parties stipulated to the underlying facts. An actual justiciable controversy may exist in an action for declaratory relief even though the parties to the action are not antagonistic, and in fact desire the same result. (City of Burbank v. Burbank-Glendale-PasadenaAirport Authority (2003) 113 Cal.App.4th 465, 481.) The absence of a factual dispute does not foreclose a judicial declaration of the parties rights.

II. Determining the Priority of Judgment Liens

By recording abstracts of judgment, Debra and Donald created judgment liens on the real property owned by the Kachlons. The question before us is whether, pursuant to the statutory scheme regarding enforcement of judgments, Debra created a lien which holds priority over any lien later created thereafter by Donalds filing of an abstract of judgment. Debra argues that the underlying trial involving the Kachlons resulted in separate judgments, one in her favor and one in Donalds favor. She contends that, in accordance with the language of the relevant statutes, her judgment lien has priority over any lien created by Donald as to his separate judgment. Donald argues that there was only one judgment, and that pursuant to section 697.020, subdivision (b), when he subsequently recorded his abstracts of judgment, the priority of his lien related back to the date Debra created her lien, rendering their liens of equal priority. In order to explain why Donalds position is correct, we first set forth the relevant statutes.

A. The Enforcement of Judgments Law (Code Civ. Proc.,  680.010 et seq.)

Section 680.230 provides that a [j]udgment means a judgment, order, or decree entered in a court of this state. A [m]oney judgment means that part of a judgment that requires the payment of money. ( 680.270.)

Except as otherwise provided by statute, a judgment lien on real property is created under this section by recording an abstract of a money judgment with the county recorder. ( 697.310, subd. (a). See also  674 [information required to be included in abstract of judgment].) Section 697.350, subdivision (a) provides that [e]xcept as otherwise provided by statute, a judgment lien on real property is a lien for the amount required to satisfy the money judgment. (See also  697.010.) In turn, section 695.210 specifies that [t]he amount required to satisfy a money judgment is the total amount of the judgment as entered or renewed, plus costs and interest. (See also  680.300, 685.090.)

A judgment lien on real property attaches to all interests in real property in the county where the lien is created that are subject to enforcement of money judgments (except as provided by statute for declared homestead exemptions). ( 697.340; see also  704.950.)

A lump-sum judgment lien (i.e., one created by recording an abstract of judgment pursuant to  697.310) has priority over any other lump-sum judgment lien thereafter created, and has priority over an installment judgment lien. ( 697.380.)

Of particular relevance here is section 697.020, subdivision (b), which provides as follows: If a lien is created on property pursuant to this division and a later lien of the same or a different type is created pursuant to this division on the same property under the same judgment while the earlier lien is in effect, the priority of the later lien relates back to the date the earlier lien was created. (Italics added.)

B. Discussion

Here, the trial court held that the underlying trial resulted in a single judgment. Citing section 697.020, subdivision (b), the court held that Donalds lien, on the same property and under the same judgment, related back to the date the earlier lien was created by Debra on February 11, 2005, and was therefore equal in priority. Accordingly, neither Donalds nor Debras lien has priority over the other.

[A] courts first task is to ascertain the intent of the Legislature so as to effectuate the purpose of the law. In determining such intent, a court must look first to the words of the statutes themselves. . . . [These words] must be construed in context, keeping in mind the statutory purpose, and statutes or statutory sections relating to the same subject must be harmonized, both internally and with each other, to the extent possible. [Citations.] (Dyna-Med, Inc. v. Fair Employment & Housing Com. (1987) 43 Cal.3d 1379, 1386-1387.) Also, whenever possible, the courts construction should seek to avoid absurd or anomalous results. (People v. Gonzalez (1990) 51 Cal.3d 1179, 1221.) (Teaman v. Wilkinson (1997) 59 Cal.App.4th 1259, 1265.) However, [i]f the terms of the statute are unambiguous, we presume the lawmakers meant what they said, and the plain meaning of the language governs. [Citations.] (Estate of Griswold (2001) 25 Cal.4th 904, 911.)

Section 697.020, subdivision (b), clearly applies to the present controversy. It provides: If a lien is created on property pursuant to this division [here, Debras lien created by recording an abstract of judgment on February 11, 2005] and a later lien [Donalds lien created by recording abstracts of judgment on April 4, 2005] of the same . . . type [a judgment lien] is created pursuant to this division on the same property [the Kachlons real property in Los Angeles County]under the same judgment [the judgment of February 3, 2005, as amended March 30, 2005] while the earlier lien is in effect, the priority of the later lien [Donalds lien] relates back to the date the earlier lien [Debras lien] was created. Indeed, the only point of dispute raised by Debra is whether the liens were created under the same judgment. Debra contends the judgment of February 3, 2005, actually consisted of two separate judgments. We disagree.

In support of her contention, Debra cites Emery v. Pacific Employers Ins. Co. (1937) 8 Cal.2d 663 (Emery). The issue in Emery was whether a plaintiff, whose cause of action against a defendant was for an amount below the jurisdictional minimum of the superior court, could join in an action against the same defendant, along with another plaintiff whose cause of action was for an amount within the jurisdiction of the superior court. (Id. at p. 667.) In that context, the Emery court stated: The action against [defendant] wherein plaintiffs recovered the judgments which are the basis of the instant action was a single action. Since the 1927 amendment of section 378 of the Code of Civil Procedure,_[^[4]_] persons who have sustained personal injuries in the same accident may bring a single action. [Citations.] A single action against the defendants insurer, as in the case herein, is also authorized under said section. But the judgments recovered by the several plaintiffs in the single action against the negligent defendant, and in the subsequent action against his insurer, are several judgments. Each plaintiff recovers upon his separate cause of action. No plaintiff has any interest in the sum awarded to another plaintiff. (Id. at p. 666; emphasis added by Debra.) Relying on the emphasized language, Debra concludes that there is not just one judgment in the Markowitz cases, even though the several judgments are in one document. Debra received a separate judgment and Donald received a separate judgment, each for different amounts.

Debra miscomprehends the meaning of the word several as used by the Emery court. The Court did not mean that a single action resulted in more than one judgment. The Court was referring to two judgments recovered by the several plaintiffs, one judgment against the negligent defendant, and a second, subsequent judgment against defendants insurer, each of which was a several judgment in that it created on the defendants part a separate obligation owed to each judgment creditor, rather than a joint obligation in which all plaintiffs shared an interest. Thus, the Emery case does not support the proposition that a single action results in more than one judgment where there are two plaintiffs with individual claims.

Indeed, the settled law is to the contrary. Ordinarily there is but one final judgment in an action, [fn. omitted, citing, inter alia, Evans v. Dabney (1951) 37 Cal.2d 758, 760; De Vally v. Kendall de Vally Operalogue Co. (1934) 220 Cal. 742, 745-746] regardless of the number of counts in the complaint [fn.] and regardless of the presence of a cross-complaint, [fn.] and that is the one that in effect ends the suit in the court in which it is entered and finally determines the rights of the parties in relation to the matter in controversy. [Fn.] In short, a trial court has no authority to enter multiple final judgments determining multiple issues between the same parties to an action; ordinarily only one final judgment is

authorized.^[5] (40A Cal.Jur.3d (2009) Judgments,  122. See also Nordstrom v. Corona City Water Co. (1909) 155 Cal. 206, 209-210 [action on numerous mechanics liens, Supreme Court found that the judgment was several in favor of each plaintiff, and each was limited in interest to the amount awarded to him. The plaintiffs were, however, while setting forth distinct causes of action against [defendant], authorized by statute to unite in one action, and in that action a single judgment was properly made and entered.)

Thus, while it is true that the Kachlons, and Mordechai individually, owe separate obligations to Donald and Debra, and Donald and Debra do not share any right or interest in the obligations owed to the other, there is but one judgment. Accordingly, pursuant to the plain meaning of section 697.020, subdivision (b), a lien was created by Debra, and a later lien of the same . . . type was created by Donald on the same property under the same judgment, such that the priority of the later lien relate[d] back to the date the earlier lien was created. Donalds and Debras judgment liens, as the trial court correctly concluded, share equal priority.

disposition

The judgment is affirmed. The parties are to bear their own costs on appeal.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

WILLHITE, J.

We concur:

EPSTEIN, P. J.

SUZUKAWA, J.

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^[1] All further statutory references are to the Code of Civil Procedure.

^[2] The Judgment referred to by the court is the amended judgment entered by the trial court on March 30, 2005, nunc pro tunc, to take effect as of the time of the entry of the original judgment on February 3, 2005. As relevant here, the amended judgment varied from the original judgment in that it awarded $31,578 in costs to Donald, and $19,422 in costs to Debra; both cost awards included an award of attorney fees.

^[3] Debra does not argue on appeal that she should have shared pro rata in the proceeds of the execution sale. We therefore do not address the issue.

^[4] Section 378 provides: (a) All persons may join in one action as plaintiffs if: [] (1) They assert any right to relief jointly, severally, or in the alternative, in respect of or arising out of the same transaction, occurrence, or series of transactions or occurrences and if any question of law or fact common to all these persons will arise in the action; or [] (2) They have a claim, right, or interest adverse to the defendant in the property or controversy which is the subject of the action. [] (b) It is not necessary that each plaintiff be interested as to every cause of action or as to all relief prayed for. Judgment may be given for one or more of the plaintiffs according to their respective right to relief.

^[5] An exception to the general rule is as follows: the rule in favor of a single final judgment does not apply to actions in which separate and independent relief is sought against several defendants, because whenever a several judgment is proper a court may render judgment against one or more of several defendants, leaving the action to proceed against the others. (Ibid.; italics added.) That exception is inapplicable here; a single judgment was entered against the Kachlons.