MOSK, Acting P. J. —
Plaintiff Helen Lin (Lin) appeals from a judgment entered on an order sustaining a demurrer without leave to amend in favor of defendant Mireya B. Coronado (Coronado). In her operative first amended complaint, Lin alleges she "pooled" her $150,000 with $100,000 provided by River Forest Financial LLC (River Forest) and Elevation Investments LLC (Elevation) "in partnership for the purchase" of a residential property (the property) at a foreclosure auction for the purchase price of $250,000.
The original version of the trustee's deed for the property specified that River Forest had a 75 percent interest in the property and Elevation had a 25 percent ownership interest in the property, but Lin was named on that version of the deed as a grantee without any stated percentage interest in the property. Lin alleges that the trustee's deed that was executed and recorded omitted Lin's name, which name had been included in the unrecorded, original trustee's deed; River Forest subsequently quitclaimed the property to Elevation; and without Lin's knowledge, Elevation then sold the property to Coronado. Lin claims that the alteration of the original deed renders it void, giving a transferee such as Coronado no interest in the property. As a result, Lin, in her cause of action against Coronado, seeks to quiet title to the property.
In affirming, we hold that the alteration of the deed to omit Lin's name was not material because the original version of the deed showed she had no interest in the property. Thus, Coronado, as a purchaser, has title to the property.
Lin filed a first amended complaint against Coronado, Elevation, and Cal-Western Reconveyance Corporation (Cal-Western).
In the quiet title cause of action against Coronado, Lin alleged that "her name was erased off of the Trustee's Deed" that was then recorded. Lin's allegations in a fraud cause of action against Elevation, Kucherov, and River Forest — not against Coronado — were not incorporated into the quiet title cause of action against Coronado. In that fraud cause of action, Lin alleged that Elevation, Kucherov, and River Forest knew that Lin was a partner in the purchase of the property and caused to be provided to her a "Declaration of Trustee's Sale" at the time of the sale that represented to Lin she was a co-purchaser, although the document shows her receiving no percentage of the property, and that River Forest, Kucherov, and Elevation, without Lin's knowledge, "erased or caused to be erased" her name off of the trustee's deed prior to its recording. Lin did not allege any facts in her first amended complaint suggesting Coronado was not a bona fide purchaser for value of the property. Lin's quiet title claim against Coronado is based on the invalidity of the deed because of the alteration and is not based on alleged other acts of the other defendants to deprive Lin of her share of the property and its proceeds. There were other causes of action against defendants other than Coronado.
The trial court overruled the demurrer and granted the motion to strike the prayer for attorney fees. Several months later, the trial court on its own motion decided to reconsider its ruling on Coronado's demurrer and requested further briefing on several questions. In one of its questions, the trial court stated, in effect, that it assumed that Coronado was a bona fide purchaser for value. The parties filed further briefs. Lin did not question or argue that Coronado was not a bona fide purchaser for value, but rather argued that the deed was void. After a hearing,
On appeal from a judgment after an order sustaining a demurrer, our standard of review is de novo. We exercise our independent judgment about whether, as a matter of law, the complaint states facts sufficient to state a cause of action. (McCall v. PacifiCare of Cal., Inc. (2001) 25 Cal.4th 412, 415 [106 Cal.Rptr.2d 271, 21 P.3d 1189]; Stearn v. County of San Bernardino (2009) 170 Cal.App.4th 434, 439-440 [88 Cal.Rptr.3d 330].) We view a demurrer as admitting all material facts properly pleaded but not contentions, deductions, or conclusions of fact or law. (Zelig v. County of Los Angeles
On appeal, Lin relies upon an alleged alteration of the original version of the trustee's deed, arguing that the recorded deed is void and therefore could not have provided good title, even to a bona fide purchaser for value. Coronado argues that even if prior to recording Lin's name was removed from the original trustee's deed, which removal appears to have occurred, that original deed showed River Forest and Elevation with a 100 percent interest in the property and no interest for Lin. Thus, River Forest and Elevation had 100 percent of the ownership of the property, and ultimately Elevation had 100 percent ownership of the property, which it sold to Coronado.
Lin argues that the trustee accepted her cashier's check and endorsed it. She contends, in essence, that because the deed was forged or altered before recordation, it was void ab initio and any subsequent deed, such as the one to Coronado, would not provide protection to one who is a bona fide purchaser for value. Lin suggests that she was still referred to on the trustee's deed before alteration as a cotenant, albeit with no indication of the percentage of her ownership. She further argues that if there is an ambiguity in the trustee's deed, that is a matter that should not be resolved by a demurrer. In the trial court, she said the 75/25 percent split was only as to the interests of River Forest and Elevation and not as to the 100 percent of the property; she asserted her interest in the property matched the $150,000 she contributed as part of the $250,000 purchase price. She therefore contends that the trial
Lin's claim is that her "partners" took her money, invested it in the property, and failed to make her a co-owner of the property or pay her the proceeds of the sale. According to Coronado, even if there was a breach of an obligation or duty by Lin's partners, Lin never had any title or legal interest in the property.
Lin does not allege that Coronado did not acquire her interest in the property in good faith, for fair value, and with no notice of a prior interest, which factors would make Coronado a bona fide purchaser for value. (See 5 Miller & Starr, Cal. Real Estate (3d ed. 2009) § 11:50, p. 11-170 (rel. 9/2009) (5 Miller and Starr).) According to Coronado, as a bona fide purchaser for value, her legal interest or title that is recorded takes priority over any equitable interest in the property that Lin might have. (Id. at p. 11-173.) Lin argues for the first time on appeal that because she did not allege Coronado was a bona fide purchaser for value, the trial court improperly assumed that Coronado was such a bona fide purchaser for value.
Lin, in the third cause of action for quiet title against Coronado, does not allege precisely who altered the deed — even though in other causes of actions she alleges that Kucherov, Elevation, and River Forest did so. The identity of the one altering the deed may be significant. (See, e.g., Osterberg v. Osterberg (1945) 68 Cal.App.2d 254, 261 [156 P.2d 46]; see also 3 Miller & Starr, supra, § 8:53, pp. 8-146 to 8-147; 5 Miller & Starr, supra, § 11:72, p. 11-227
Coronado contends Lin cannot prevail because any recorded document with a "defect, omission, or informality in the execution" "imparts notice of its contents to subsequent purchasers" as altered one year after such recording. (Civ. Code, § 1207.) Miller & Starr states, "Any defect in title resulting from the alteration of a recorded document is `cured' and the instrument imparts constructive notice as altered one year after it has been recorded." (5 Miller & Starr, supra, § 11:72, p. 11-227.) Lin asserts Civil Code section 1207 does not bar a claim by someone like her who is not the purchaser, but rather an alleged prior owner.
Lin alleges that her "sole identification of the Subject Property and her reliance of confirmation of her purchase investment was based on the Declaration of Sale." That "declaration" specifies that River Forest was obtaining a 75 percent interest in the property, Elevation was obtaining a 25 percent interest in the property, and Lin was identified, but with no percentage interest in the property. There is no ambiguity as to the ownership percentages. Evidence of an intent by the grantor to grant different percentages would only be relevant in a cause of action for reformation. (See Carman v. Athearn (1947) 77 Cal.App.2d 585, 596 [175 P.2d 926] ["Ambiguity has nothing to do with the question as to the right to grant reformation ...."].) Moreover, plaintiff did not allege any facts concerning the grantor's intent.
Lin asserts that the trial court improperly assumed that Coronado was a bona fide purchaser for value. It does appear that the burden is on the purchaser to establish that he, she, or it is a bona fide purchaser for value as against a prior party who claims a legal, as opposed to an equitable, interest in a property. (See 5 Miller & Starr, supra, § 11:51, p. 11-179 (rel. 9/2009); Bell v. Pleasant (1904) 145 Cal. 410, 412-414 [78 P. 957]; First Fidelity Thrift & Loan Assn. v. Alliance Bank (1998) 60 Cal.App.4th 1433, 1442 [71 Cal.Rptr.2d 295]; Hodges v. Lochhead (1963) 217 Cal.App.2d 199, 203-204 [31 Cal.Rptr. 879].)
Lin's alleged entitlement to her share of the proceeds from the sale of the property to Coronado is the subject of her claims against her "partners," who allegedly took her money to invest in the property, but failed to ensure that she had a recordable interest in the property or a legal interest in the proceeds from the sale of the property.
The judgment is affirmed. Coronado is awarded her costs on appeal.
Kriegler, J., and Goodman, J.,