Recent Posts in Joinders Category
| September 25, 2010 |
| My ex-Husband's Mother Is FORECLOSING a TRUST DEED On COMMUNITY PROPERTY - What Can I do? |
| Posted By Thurman Arnold |
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Q. Our property has not yet been divided. My husband has tried every trick in the book to delay the proceedings and has lied to the Court, and his family has lied along with him. Now I just received in the mail a Notice of Default from his mother's attorney. Before we separated we bought a commerical property off of El Paseo, in Palm Desert, in the name of our family trust. "Ed" claims that the money we used to buy that building was from his mom as a loan to us. I never heard of this until a long time after we separated.
In 2007 Ed's mom recorded a trust deed that Ed signed alone. It is dated a week before he filed for divorce, but it was recorded with Riverside County more than two years later. All of this was outside of escrow. The note is for $400,000, all due in 2008. The trust deed was notarized by her sister (a notary in Beverly HIlls) and I don't believe for a minute that it was signed by Ed when it says it was signed.
I have also learned in Ed's interrogatory answers that his mother may have placed money into one of his accounts at about the same time as the property escrow closed. She has money, and is paying Ed's lawyer too. They were planning this all along.
My attorney said that under the law and under the family trust agreement that Ed had equal management rights to our property, and so she could obligate us both only with his signature. She seems distracted and I am worried. We have about two months left before Ed's mother steals the property from us - or at least from me. What can I do?
"Carol"
A. Hi Carol. Fortunately you do have options and remedies, and I will describe one tactic. The short answer is that Ed's mother needs to be joined as a party to the divorce proceedings, and a restraining order obtained from the family court to stay the foreclosure to protect the community estate until the validity of the trust deed has been determined. There is a procedure for bifurcating trials in family law cases to fast track pivotal issues in a kind of mini-trial. Whether the Court joins her or not, I recommend a bifurcation and a separate trial on the validity of the both the note and the obligation itself.
My purpose here is to give you an overview of what joinder is and how it might help you.
BTW, this is a type of conduct that defines high conflict divorce cases, making divorces unnessarily ugly, complex and expensive. When family members with money underwrite their adult child's divorce agenda (or even write the script), the adversary divorce experience can feel quite overwhelming. It is doubly sad for the children of couples in divorce when grandparents want to help crush the other parent since kids see the hatred for what it is, and this insight doesn't strengthen the grandparent/grandchild bond, model positive behaviors, and tends to alienate children from everyone involved - and from themselves.
The foreclosure process requires a 90 Day Notice of Default, and must be followed with a 21 day Notice of Trustee's Sale, before title can be transferred to a creditor.
Your attorney's first task is to stop the foreclosure. That should not be difficult under these facts. I would be surprised if a well reasoned letter to the other attorneys didn't back off on the foreclosure under these facts. Ed's mom bears some significant risks if she continues on this course. She may end up funding your attorney in defending against the Notice of Default (NOD) and in reimbursing most or all of your attorney fees on the joinder, and the Court may declare her to be owed nothing or to be an unsecured creditor of her son only.
Next, she needs to file a joinder petition within the dissolution action - probably whether or not the mother ceases the foreclosure - because the validty of the trust deed needs to be determined and you are far better off doing this within your dissolution proceeding. Family Code section 2021 authorizes courts to order the joinder of a person or entity.
California Rules of Court, Rule 5.150 and
Rule 5.154 amplify the description of who can be joined and what needs to be shown. oinders are common when dealing with pension plans, but of course that is not your issue today.
You want the joinder because once Mom becomes a joined party to the proceedings the family court has jurisdiction over not only her, but with what to do with the property and to declare the trust deed invalid. If she is not joined, then the Court can only determine rights as between you and your husband - it has no jurisdiction over Mom directly and so no authority to render any binding decisions upon her. Moreover, if the trust deed is set aside this means Ed's mom becomes an unsecured general creditor of the estate - or possibly only a creditor of Ed's. This may have the effect ensuring that the Palm Desert building is owned by the community free and clear, and that so dramatically increase the value of your share since it may be that the mother's money really did fund the purchase (since she deposited money into Ed's account at about the time escrow closed).
Also, while the law is not settled on this point, a party joined to dissolution case may be liable for attorney's fees incurred by the other parties relative to this issues for which they are joined.
In order to be entitled to an order joining a party it must be shown to the court that the person involved claims an interest in the community property or community debts. This includes creditors like Ed's mother. By the way, she herself has the right to request that she be joined but has little incentive to do so.
There is much more to say. If your attorney doesn't understand this strategy or the procedure, find yourself a competent family law specialist. The stakes are simply too high.
T.W. Arnold III
September 25, 2010 |
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