Procedural Posture
The parties appealed the judgment of the San Mateo County Superior Court (California) in a property foreclosure dispute. Visit the one of the best lawyers to defend lawsuit in San Mateo County.
Overview
Defendant developers purchased 91 acres of raw land for $ 6 million down and a $ 3 million purchase money note secured by the real property. They agreed to waive antideficiency protection under Cal. Civ. Proc. Code §580b; plaintiff vendor, in turn, subordinated his promissory note to that of a third party commercial lender. Upon defendants' default and the senior lender's foreclosure sale, plaintiff sued for his deficiency. Parties claimed fraud. The court held that the sales transaction came within the scope of § 580b, and hence reversed the judgment in favor of plaintiff on his suit for fraud and breach of contract. However, the court affirmed the judgment rendered against defendant developers on their countersuit. Section 580b, which barred plaintiff from obtaining a deficiency judgment for the unpaid purchase price secured by a trust deed on the property purchased, could not be waived.
Outcome
The court reversed the judgment in favor of plaintiff on his complaint, but affirmed the judgment in his favor on the cross-complaint. Statute barring plaintiff as a vendor from obtaining a deficiency judgment for the unpaid purchase price of property secured by a trust deed could not be waived.