Selene RMOF II Reo Acquisitions II, LLC v. Ward ( 2017 )

This opinion was filed for record
at. ~: 00 ~ on-AU§ .3, 7Jl n
`` SUSAN L. CARLSON
SUPREME COURT CLERK
IN THE SUPREME COURT OF THE STATE OF WASHINGTON
SELENE RMOF II REO ACQUISITIONS )
II, LLC, ) No. 92967-0
)
Petitioner, )
)
v. )
)
VANESSA D. WARD and all occupants of ) En Banc
the premises located at 7913 South 115th )
Place m/k/a 7911 South 115th Place, )
Seattle, WA 98178, )
)
Respondents. ) Filed AllG O3 2017
MADSEN, J.--This case involves transfers of property that once belonged to
Vanessa Ward and now belongs to Selene RMOF II REO Acquisitions II LLC, which
acquired the property in 2012 from a purchaser at a nonjudicial foreclosure sale. It also
concerns Ward's claim that she was the victim of mortgage fraud regarding the property
in 2004 and that all subsequent property transfers were therefore void. 1 Selene
challenges an unpublished Court of Appeals, Division One, decision reversing an order
granting Selene a writ of restitution evicting Ward from Selene's property. At issue is
whether Selene was authorized to bring an unlawful detainer action as a purchaser from
someone who had bought the property at a nonjudicial foreclosure sale. Also at issue is
1
Ward appeared prose below.
No. 92967-0
whether the summary procedures of unlawful detainer were available where Ward
asserted ownership of the property she occupied via an unrecorded quitclaim deed. We
hold that unlawful detainer was available to Selene under the circumstances of this case
and reverse the Court of Appeals.
FACTS
The disputed property is a single family residence in King County. Parcel data
from the King County Department of Assessments shows that Ward bought the property
in 1999 by statutory warranty deed. It also shows that Ward quitclaimed the property to
Chester Dorsey in 2000 in a transaction involving foreclosure. Ward asserts that in 2004,
Dorsey quitclaimed the property back to her through a deed that was notarized but never
recorded. 2 Parcel data of course does not show that alleged transaction, but it shows
rather that in 2005, Dorsey sold the property by statutory warranty deed to Fred and
Grace Brooks, who in turn sold it by statutory warranty deed to James Dreier in 2007.
Dreier executed a deed of trust on the property to secure a loan, and in 2009,
LaSalle Bank acquired the property at a nonjudicial foreclosure sale on the deed of trust.
Ward still occupied the property, and LaSalle and its successor filed two unlawful
detainer actions against her but apparently did not further pursue them. In 2012, LaSalle
sold the property to Selene by special warranty deed, and in 2014, Selene filed a third
unlawful detainer action against Ward, alleging that she was "believed to be a tenant of
the former owner of the property." Clerk's Papers (CP) at 1, 79. Selene further alleged
2 Ward provided a quitclaim deed that appears to be dated December 2, 2004, and shows only a
fragment of a notary stamp.
2
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that Selene had acquired its interest from LaSalle after foreclosure and that pursuant to
RCW 61.24.060 (discussed below), the purchaser at a trustee's sale had a right to
summary unlawful detainer proceedings to obtain possession of the property under
chapter 59.12 RCW. An initial writ of restitution was ordered and then vacated for lack
of proper service. Ward subsequently moved for an order setting the case for trial and
denying the writ of restitution, contending that the unlawful detainer proceeding could
not go forward because she had color of title and was not a tenant.
At the unlawful detainer hearing, Ward repeatedly asserted that she was the
property owner, that she had paid the mortgage until 2007, and that she was the victim of
fraud involving Dorsey and another person who had stolen and then paid off her
mortgage. Am. Verbatim Report of Proceeding (VRP) at 1-6, 18, 20. But she admitted·
that she had not made any mortgage payments since 2007 and that she had notice of the
foreclosure proceeding. She testified that she filed a lawsuit to enjoin the foreclosure on
the day of the sale, but she admitted that her suit was dismissed because she failed to
pursue it.
The trial court granted a writ of restitution to Selene, stating that Ward had had
time either to appeal the dismissal of her suit or pursue other remedies. Ward appealed,
and Division One reversed in an unpublished decision, holding that because Ward held a
quitclaim deed to the property, the summary unlawful detainer action was not available.
Selene RMOF II REG Acquisitions IL LLC v. Ward, No. 72504-1-I, slip op. at 1 (Wash.
Ct. App. Feb. 29, 2016) (unpublished),
http://www.courts.wa.gov/opinions/PDF/725041.pdf, review granted, 186 Wash. 2d 1008,
3
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380 P.3d 458 (2016). Division One also held that because Selene did not purchase the
property at the foreclosure sale, unlawful detainer proceedings under RCW 61.24.060(1)
did not apply. Id. Selene petitioned for review, which this court granted.
ANALYSIS
Whether unlawful detainer is available to Selene
"As with all questions of law, questions of statutory interpretation are reviewed de
novo." Berrocal v. Fernandez, 155 Wash. 2d 585, 590, 121 P.3d 82 (2005). Here, the
Court of Appeals held that because Selene was not the initial purchaser at the nonjudicial
foreclosure sale, it could not bring an unlawful detainer action under RCW 61.24.060(1)
to obtain possession of the property that it owned. RCW 59.12.032 provides, "An
unlawful detainer action, commenced as a result of a trustee's sale under chapter 61.24
RCW, must comply with the requirements ofRCW 61.24.040 [(addressing service
requirements)] and 61.24.060." Thus, RCW 59.12.032 "authorizes the purchaser at a
deed of trust foreclosure sale to bring an unlawful detainer action to evict the previous
owner of the home, provided the sale complied with the statutory foreclosure rules."
Fed. Nat'! Mortg. Ass 'n v. Ndiaye, 188 Wash. App. 376, 381, 353 P.3d 644 (2015). RCW
61.24.060( 1) provides, in relevant part, "The purchaser at the trustee's sale shall be
entitled to possession of the property on the twentieth day following the sale . . . . The
purchaser shall also have a right to the summary proceedings to obtain possession of real
property provided in chapter 59.12 RCW." See also Ndiaye, 188 Wash. App. at 381-82.
Restated, "[a]s a means to gain possession of real property, unlawful detainer is available
to one who holds a title as a purchaser at a deed of trust foreclosure sale." Id. at 384
4
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(citing Puget Sound Inv. Grp., Inc. v. Bridges, 92 Wash. App. 523, 526, 963 P.2d 944
(1998)); see also RCW 61.24.060(1).
In Savings Bank of Puget Sound v. Mink, 49 Wash. App. 204, 741 P.2d 1043 (1987),
Division One discussed the legislative intent underlying the availability of unlawful
detainer in the nonjudicial foreclosure context. Division One stated:
[Chapter 61.24 RCWJ provides the method for nonjudicial
foreclosure of a deed of trust. The chapter was designed by the Legislature
to avoid costly, time-consuming judicial foreclosure proceedings, and also
to "provide an adequate opportunity [or notice] for interested parties to
prevent wrongful foreclosure." Detailed notice requirements for each stage
of the foreclosure proceeding are set forth in the chapter.
Id. at 207-08 (citations omitted) (quoting Cox v. Helenius, 103 Wash. 2d 383, 387, 693 P.2d
683 (1985)). Concerning unlawful detainer, the court opined:
For its part, [chapter 59.12 RCW] is designed to provide expeditious,
summary proceedings for the removal of persons in the possession of the
property of another, Munden v. Hazelrigg, 105 Wash. 2d 39, 711 P.2d 295
(1985), who are either in breach of a condition to that occupancy, have
committed waste, have unlawfully entered, or have held over after
expiration of a tenancy for a definite term. [(Citing former RCW 59.12.030
(1983) (defining "unlawful detainer").] We believe that the Legislature
intended to preserve the summary nature offoreclosure actions permitted
under [chapter 61.24 RCW] in referring purchasers to the unlawful
detainer statutes for the removal of "reluctant" former owners. [Chapter
61.24 RCW] provides for detailed notices and provides opportunities to
cure for the defaulting property owner .... Application of [unlawful
detainer] to these proceedings will provide a remedy that is consistent with
the spirit and intent of the Legislature in enacting [chapter 61.24 RCW] and
will do so without prejudice to the rights of the defaulting party. We so
hold.
Id. at 208 (emphasis added) (footnote omitted). Division Three has similarly recognized
the underlying legislative impetus behind RCW 61.24.060(1 ), stating:
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The statutory scheme of the act gives the purchaser at a trustee's sale
the right to possession on the 20th day following the sale. RCW 61.24.060.
The act was designed by the legislature to avoid time-consuming judicial
foreclosure proceedings and to save substantial time and money to both the
buyer and the lender. This feature of the act has been applauded as meeting
the needs of modern real estate financing. By the terms of the act it is clear
the legislature did not contemplate that after the trustee's sale further
lengthy proceedings would be required to obtain possession. It gave the
purchaser at a trustee's sale the right to obtain possession of the real
property by summary proceedings in an unlawful detainer action.
Peoples Nat'l Bank of Wash. v. Ostrander, 6 Wash. App. 28, 31, 491 P.2d 1058 (1971)
(emphasis added) (citation omitted).
In light of the noted legislative intent, it would be anomalous to read RCW
61.24. 060( 1) to thwart such intent by limiting the availability of unlawful detainer to the
first purchase following a nonjudicial foreclosure sale. By its terms, the statute makes
available expedited eviction proceedings to the property's deed holder following a
nonjudicial foreclosure sale. But the statute's language does not expressly limit the
availability of unlawful detainer to only the first owner of the property following
foreclosure. To read the statute as doing so, as Ward advocates, defeats the noted
legislative purpose of providing expedited proceedings to facilitate real estate financing
and transactions.
Finding no Washington cases directly on point, Selene relies on Evans v. Superior
Court, 67 Cal. App. 3d 162, 136 Cal. Rptr. 596 (1977). There, the California appellate
court addressed the comparable question presented here, "[w Jhether a subsequent
purchaser from a purchaser at a foreclosure sale can maintain an unlawful detainer action
under [the California unlawful detainer statute, California Code of Civil Procedure
6
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section 1161 a]." Id. at 167. The Evans court explained that while the cause of action for
unlawful detainer was historically available only to a landlord against his tenant, the
remedy has been expanded by statute to additional categories of plaintiffs and defendants.
The Evans court noted that California Code of Civil Procedure section 1161 a, which
provides for removal of holdover persons in various circumstances, is framed in terms of
the events that may give rise to the unlawful detainer action and the persons against
whom such actions may be brought, but the statute is silent as to who may bring such
actions. Id. The Evans court stated, "The policy behind the statute is clear, however: to
provide a summary method of ouster where an occupant holds over possession after sale
of the property. That policy would not be served by restricting availability of the action
to the original purchaser at a foreclosure sale." Id. at 168 (emphasis added).
Accordingly, the Evans court held that "a subsequent purchaser from a purchaser at a
foreclosure sale may bring an [unlawful detainer] action [under California Code of Civil
Procedure section 1161a]." Id. at 169-70. 3 The result in Evans comports with the
legislative intent and purpose ofRCW 61.24.060(1) as noted in Mink and Ostrander.
Further, the interest obtained by LaSalle as the purchaser at the foreclosure sale
clearly included the right to pursue the unlawful detainer action against Ward, as
provided in RCW 61.24.060(1). Also, as the holder of the trust deed, LaSalle took "all of
the right, title, and interest" in the property that the foreclosure sale conveyed. See RCW
3
The Evans court also held that because the unlawful detainer complaint addressed only
possession of the property, the occupiers' responsive answers, which raised defenses or counter
claims concerning title issues, were not cognizable; and the occupiers' remedy was to seek
adjudication of such title claims in a separate quiet title action. 67 Cal. App. 3d at 170-72.
7
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61.24.050(1); Udall v. T.D. Escrow Servs., Inc., 159 Wn.2d 903,910, 154 P.3d 882
(2007). 4
LaSalle's subsequent transfer to Selene by special warranty deed conveyed
LaSalle's entire interest "in fee simple." See RCW 64.04.040 (bargain and sale deed
convey's grantor's entire interest "in fee simple"). LaSalle's ownership rights, which
included the right to possess the property, transferred to Selene via the special warranty
deed. Cf Mfd. Haus. Cmtys. a/Wash. v. State, 142 Wn.2d 347,364, 13 P.3d 183 (2000)
(right to possess, exclude others, and dispose of property are fundamental attributes of
property ownership). Because Selene received all ofLaSalle's ownership rights,
Division One's holding, which would permit owner LaSalle to pursue an unlawful
detainer action to recover possession of the property but would bar conveyee owner
Selene from doing the same, is contrary to the legislative "spirit and intent" behind the
statutory scheme as discussed above, and finds no support in law. See Mink, 49 Wn.
App. at 208; cf Mut. of Enumclaw Ins. Co. v. USF Ins. Co., 164 Wn.2d 411,424, 191
P.3d 866 (2008) (assignee steps into the shoes of the assignor and has all of the rights of
the assignor); Puget Sound Nat 'l Bank v. Dep 't of Revenue, 123 Wash. 2d 284, 292, 868
P.2d 127 (1994) (assignee's rights include not only those identified in the contract, but
also applicable statutory rights); AAA Cabinets & Millwork, Inc. v. Accredited Sur. &
Cas. Co., 132 Wash. App. 202, 208, 130 P.3d 887 (2006) (assignee acquires whatever
4
The trust deed, which contained recitals that it complied with the requirements of chapter 61.24
RCW (deeds of trust act), is "prima facie evidence" of a proper sale and "conclusive evidence
thereof in favor of bona fide purchasers." RCW 61.24. 040(7).
8
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rights the assignor had prior to the assignment). Accordingly, we hold that because
LaSalle conveyed its entire interest to Selene, Selene may pursue the unlawful detainer
action under RCW 61.24.060(1) to obtain possession of the conveyed property.
Color of Title
Relying on RCW 59.12.030(6), the Court of Appeals held that Ward's 2004
quitclaim deed provided her with "color of title" sufficient to render the summary
unlawful detainer procedures unavailable and, thus, Selene must establish superior title
via a quiet title action before it may proceed with eviction. 5 Selene, slip op. at 1. For the
reasons discussed below, we reverse.
As a threshold matter, Ndiaye, which views unlawful detainer in the context of
nonjudicial foreclosure, provides an appropriate resolution of this case. As Division
Three reiterated in Ndiaye, "Unlawful detainer is a summary proceeding for obtaining
possession of real property, and the cause of action holds priority in scheduling over
other civil cases." 188 Wash. App. at 382. The action is narrow, "limited to the question
of possession and related issues such as restitution of the premises and rent." Id. (citing
Munden, 105 Wn.2d at 45). "Unlawful detainer actions offer a plaintiff the advantage of
speedy relief, but do not provide a forum for litigating claims to title." Id. Counterclaims
may not be asserted in an unlawful detainer action. Id. (citing Granat v. Keasler, 99
Wash. 2d 564, 570, 663 P.2d 830 (1983)). The "only exception" to this rule is "when the
5
RCW 59.12.030(6) provides that "[a] person who, without the permission of the owner and
without having color of title thereto, enters upon land of another and who fails or refuses to
remove therefrom after three days' notice" is guilty of unlawful detainer.
9
No. 92967-0
counterclaim, affirmative equitable defense, or setoff is 'based on facts which excuse a
tenant's breach.'" Id. (internal quotation marks omitted) (quoting Munden, l 05 Wn.2d at
45).
In Ndiaye, the Federal National Mortgage Association (Fannie Mae), which
purchased the property in question at a nonjudicial foreclosure sale, sought a writ of
restitution in an unlawful detainer proceeding to evict the occupier of the foreclosed
home. In his answer, the occupier asserted in part "title defects" that affected Fannie
Mae's trustee's deed. Id. at 380. The trial court issued the writ, ruling that an unlawful
detainer action is not the appropriate place to raise a collateral attack on the nonjudicial
foreclosure. Id at 381.
In affirming, Division Three noted that "[i]n a nonjudicial foreclosure, the grantor
of the deed of trust, when facing the loss of his property, can bring an action to restrain
the trustee's sale 'on any proper legal or equitable ground,'" id. at 3 82 (quoting RCW
61.24.130(1)), and that "[fJailure to pursue presale remedies can ... constitute equitable
waiver of those defenses." Id. (citing RCW 61.24.040(1)(:f)(IX)). 6 "Allowing the
borrower to delay asserting a defense until after the sale would defeat the spirit and intent
of the deed of trust act." Id. at 382-83 (citing Plein v. Lackey, 149 Wn.2d 214,228, 67
P.3d 1061 (2003)). Division Three held that under the circumstances of the case, "waiver
6
As Division Three observed, "[W]aiver of defenses to a trnstee's sale occurs when a party: (1)
received notice of the right to restrain the sale, (2) had actual or constrnctive knowledge of a
defense to foreclosure prior to the sale, and (3) failed to bring an action to obtain a court order
enjoining the sale." Ndiaye, 188 Wash. App. at 382 (citingAlbice v. Premier Mortg. Servs. of
Wash., Inc., 174 Wn.2d 560,569,276 P.3d 1277 (2012); Plein v. Lackey, 149 Wn.2d 214,227,
67 P.3d 1061 (2003)).
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applies as a matter of law." Id. at 3 83. N diaye defended the unlawful detainer action,
asserting that Fannie Mae could not perfect its chain of title. Id. But because title
transfers were a matter of public record, N diaye had constructive notice of any defect in
the chain of title before the foreclosure sale. Id. at 383-84. "One cannot be heard to say
that he did not know of these matters which were open, obvious, and of public record."
Id. at 384. In affirming the writ, Division Three stated, "Questions of title are usually a
matter of public record. [Accordingly,] unlawful detainer actions are not the proper
forum to litigate questions of title." Id.
Under Ndiaye, Ward cannot bring her title challenge as a defense in the unlawful
detainer action; the appropriate time to assert such challenge was prior to foreclosure. In
response to questioning by the commissioner, Ward admitted at the unlawful detainer
show cause hearing that at the time of the foreclosure, she had notice of the pending sale
and in fact filed a lawsuit to stop it, apparently raising her title challenge and assertions of
fraudulent transfer. See CP at 29; VRP at 17-23. However, she explained that because
she "didn't submit something," her suit was ultimately dismissed with prejudice. VRP at
21. Ward did not seek review of that dismissal, and thus her title challenge is waived.
See Ndiaye, 188 Wash. App. at 382-84. Thus, as a threshold matter, applying Ndiaye to the
circumstances of this case, Ward is foreclosed from asserting her title challenge as a
defense to the unlawful detainer action.
Mink is in accord. There, the occupier of the property asserted numerous defenses
and counterclaims in the unlawful detainer action. Division One reiterated that "an action
under RCW 59.12.030 'is a narrow one, limited to the question of possession and related
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No. 92967-0
issues such as restitution of the premises and rent. In order to protect the summary nature
of the unlawful detainer proceedings, other claims, including counterclaims, are generally
not allowed."' Mink, 49 Wash. App. at 208-09 (quoting Munden, I 05 Wn.2d at 45).
Mink's affirmative defenses and counterclaims included allegations of slander of title and
fraud. Division One held, "These do not directly relate to the 'question of possession'
and may not be raised in an unlawful detainer action." Id. at 209. The court held that
Mink was not precluded from raising his claims, but he must do so "in the proper
proceeding." Id. at 210; see Evans, 67 Cal. App. 3d at 170-72 (occupiers remedy was to
seek adjudication of their title claims in a separate quiet title action, not as defenses in the
unlawful detainer action). Ndiaye and Mink provide the appropriate resolution here.
Ward cannot assert a title claim in this unlawful detainer action.
As to Ward's assertion of color of title, the Court of Appeals relied on its prior
decision in Bridges, 92 Wash. App. 523. There, an investment group purchased property at
a public auction following the federal Internal Revenue Service's (IRS) foreclosure of a
tax lien on the home in question. Following the sale, the IRS issued the purchaser a
quitclaim deed. Id. at 525. The investment group sought a writ of restitution for
possession of the property under RCW 59.12.030(6). Division One held that while the
legislature had authorized the purchaser at a deed of trust foreclosure sale to bring an
unlawful detainer action under RCW 61.24.060, "[t]he Legislature has not provided a
purchaser of real property at a federal income tax foreclosure sale with similar authority
to bring an unlawful detainer action." Id. at 526. Division One also held that the tax sale
purchaser could not pursue unlawful detainer under RCW 59.12.030(6) because the
12
No. 92967-0
occupant held a "statutory warranty deed" and thus color of title. Id. at 527.
Accordingly, under Bridges the tax sale purchaser, who holds only a quitclaim deed on
the real property in question, must establish superior title in a quiet title action against the
occupier of the real property, who holds a statutory warranty deed, before such purchaser
can pursue an unlawful detainer action against the occupier under RCW 59.12.030(6).
The tax sale addressed in Bridges is not the deed of trust foreclosure sale present here.
Because the circumstance here is markedly different, Division One's reliance on
Bridges is inappropriate. 7 First, the quitclaim deed that Ward proffered contains an
unreadable notary signature and only a fragment of a·h6tary seal. That fragment does not
show the notary's number or full name. See CP at 45. The document is dubious, and,
more importantly, it is unrecorded.
"Title to real property can only be conveyed by a valid, acknowledged deed ....
RCW 64.04.010, .020." Fid. Mut. Sav. Bank v. Mark, 112 Wash. 2d 47, 53, 767 P.2d 1382
(1989). RCW 64.04.010 provides that "[e]very conveyance of real estate, or any interest
therein ... shall be by deed." "[U]nder Washington law, the general rule is that a
transfer of an interest in real property cannot occur absent a deed." In re Betchan, 524
B.R. 830, 832 (Banlcr. E.D. Wash. 2015). RCW 64.04.020 requires that "[e]very deed
shall be in writing, signed by the party bound thereby, and acknowledged by the party
before some person authorized by this act to take acknowledgments of deeds." (Reviser's
7
As discussed above, RCW 61.24.060(1) provides that the purchaser at a deed of trust
foreclosure sale may bring an unlawful detainer action against an occupier of the property. For
the noted reasons, that interest transferred from nonjudicial foreclosure sale purchaser LaSalle to
Selene via special warranty deed. This additionally distinguishes Bridges from the present case.
13
No. 92967-0
note omitted.) "[I]n Washington a document that purports to transfer an interest in real
property is not effective until it is acknowledged by a notary public or other authorized
person." Id. at 832 (emphasis added). Here, Ward's purported 2004 quitclaim deed is
not properly notarized.
"Color of title 'means that the adverse claimant holds or traces back to a title
document, usually a deed, that appears on its face to convey good title, but that, for some
reason that does not appear on its face, did not convey title."' Campbell v. Reed, l 34
Wn. App. 349,358, 139 P.3d 419 (2006) (emphasis added) (quoting WILLIAM B.
STOEBUCK & JOHN W. WEAVER, 17 WASHINGTON PRACTICE: REAL ESTATE: PROPERTY
LAW§ 8.20, at 542 (2d ed. 2004)). As noted, Ward's 2004 quitclaim deed does not
"appear on its face" to convey good title given the incomplete notarization. Under these
circumstances, the Court of Appeals determination that Ward's quitclaim deed provided
her with "color of title" is error.
Moreover, Ward contends that she has superior title because her 2004 quitclaim
deed is earlier in time to all subsequent transactions, and because all transactions
following the allegedly fraudulent 2005 conveyance from Dorsey to Brooks are
necessarily "fraudulent, defective, and void as a matter of law." Am. Opening Br. of
Appellant at 7; see also Appellant's Resp. to Pet. for Review at 7 (Ward argues that
because of the earlier fraud, the foreclosure sale purchaser, LaSalle, had no right, title,
and interest in the property to convey to Selene). But Ward ignores that her quitclaim
deed is umecorded and thus invalid against subsequent good faith purchasers under the
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No. 92967-0
facts here. See RCW 65.08.070; 8 see also Levien v. Fiala, 79 Wash. App. 294, 299-300,
902 P.2d 170 (1995) ("A bona fide purchaser of an interest in real property is entitled to
rely on record title; the protection afforded him by the real property recording statute,
RCW 65.08.070, is unaffected by the vendor's lack of good faith or by matters of which
the vendor has notice." (footnote omitted)); see also Lind v. City ofBellingham, 139
Wash. 143, 147,245 P. 925 (1926) ("a person purchasing real property may rely on the
record title to the property, in the absence of knowledge of title in another, or of facts
sufficient to put him on inquiry"). Moreover, "[a] circumstance that would lead a person
to inquire, however, is only notice of what reasonable inquiry would reveal." Levien, 79
Wash. App. at 299. Here, reasonable inquiry (i.e., search of the county deed records)
would not show Ward's umecorded quitclaim deed. 9
Parties who delay recording their deeds to property until after
another has recorded a deed to the same property have the burden of
proving actual or constructive notice of their interest in property by the
other, and if they fail to do so, their prior conveyance is void as against that
party by virtue of RCW 65.08.070.
8
RCW 65.08.070 provides in part:
A conveyance of real property, when acknowledged by the person executing the
same (the acknowledgment being certified as required by law), may be recorded
in the office of the recording officer of the county where the property is situated.
Every such conveyance not so recorded is void as against any subsequent
purchaser or mortgagee in good faith and for a valuable consideration from the
same vendor, his or her heirs or devisees, of the same real property or any portion
thereof whose conveyance is first duly recorded.
(Emphasis added.)
9
"' [O]ne searching the index has a right to rely upon what the index and recorded document
discloses and is not bound to search the record outside the chain of title of the property presently
being conveyed."' Valentine v. Portland Timber & Land Holding Co., 15 Wash. App. 124, 131,
547 P.2d 912 (1976) (quoting Koch v. Swanson, 4 Wn. App. 456,459,481 P.2d 915 (1971)).
15
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Id. at 300 (emphasis added). 10
In sum, Bridges is distinguishable and the Court of Appeals' reliance thereon is
misplaced. The competing deeds in Bridges revealed a genuine question regarding title,
but this case does not. As discussed, Ward's quitclaim deed does not appear on its face
to convey good title, and, in any event, it is unrecorded. 11 Under these circumstances, we
resolve this case in accord with Ndiaye and Mink as discussed above. 12
CONCLUSION
Under the circumstances of this case, the Court of Appeals erred in determining
that a RCW 61.24.060(1) unlawful detainer action was not available to Selene and that
Ward's facially deficient quitclaim deed provided her with color of title rendering
unlawful detainer under RCW 59. 12.030(6) unavailable. We reverse the Court of
Appeals unpublished decision and remand for reinstatement of the trial court's writ of
restitution. We deny Ward's request for attorney fees.
10
'"The purpose of the recording statute is to make the deed first recorded superior to any
outstanding unrecorded conveyance of the same property unless the mortgagee or purchaser had
actual knowledge of the transfer not filed ofrecord. "' Id. at 129 (quoting Tacoma Hotel, Inc. v.
Morrison & Co., 193 Wash. 134, 140, 74 P.2d 1003 (1938)). Accordingly, "an unrecorded
conveyance is void as against a subsequent purchaser in good faith for value from the same
vendor of the same property whose conveyance is first recorded." Id.
11
The resolution of Ward's alleged title issues is for Ward to pursue in a separate action. See
Mink, 49 Wash. App. at 210; Evans, 67 Cal. App. 3d at 170-72.
12
Ward requests costs and statutory attorney fees, citing without discussion RCW 4.84.010, RAP
14 .2, and RAP 18. 1. Since we reverse the Court of Appeals, Ward is not the prevailing party and
no fees are warranted.
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WE CONCUR:
17
Selene RMOFIIREO Acquisitions IL LLC v. Ward, No. 92967-0
(Yu, J., dissenting)
No. 92967-0
YU, J. (dissenting)-The majority holds that the statutory right to bring an
unlawful detainer action following a trustee's sale may be transferred to a
subsequent purchaser by way of special warranty deed. Majority at 8 ("LaSalle[]
[Bank's] ownership rights, which included the right to possess the property,
transferred to Selene [RMOF II REO Acquisitions II LLC] via the special warranty
deed."). I respectfully disagree. While certainly true that the legislature intended
"to preserve the summary nature of foreclosure actions ... in referring purchasers
to the unlawful detainer statutes for the removal of 'reluctant' former owners," it is
less clear that the legislature intended for this remedy to exist indefinitely for all
subsequent owners. Sav. Bank ofPuget Sound v. Mink, 49 Wash. App. 204, 208, 741
P.2d 1043 (1987). In fact, the plain language ofRCW 61.24.060(1) provides the
right to summary proceedings to the purchaser at the trustee's sale-not the
purchaser and all heirs, successors, and assigns. If the legislature intended for this
right to survive beyond the purchaser, it would have stated as such.
1
Selene RMOF II REO Acquisitions IL LLC v. Ward, No. 92967-0
(Yu, J., dissenting)
The majority and Selene point to a California appellate case for the policy
reasons why subsequent purchasers should be permitted to utilize the unlawful
detainer process. Majority at 6-7 ( citing Evans v. Superior Court, 67 Cal. App. 3d
162, 167-68, 136 Cal. Rptr. 596 (1977)). But as the majority points out, that case
interpreted California's Code of Civil Procedure § 1161 a, which is "silent as to
who may bring [unlawful detainer] actions." Majority at 7. This is not so in our
own statute. Instead, the right to utilize unlawful detainer proceedings is expressly
limited to "[t]he purchaser at the trustee's sale." RCW 61.24.060(1 ).
Such a limitation makes practical sense given the context of nonjudicial
foreclosure sales. The purchaser at a trustee's sale is presumed to have good title
because the nonjudicial foreclosure process assures it, provided the sale complied
with the statutory foreclosure rules. RCW 61.24.040(7) (recital of facts showing
compliance serves as "prima facie evidence of such compliance and conclusive
evidence thereof in favor of bona fide purchasers"). Notice of a trustee's sale must
be given to a wide range of parties with a potential interest in the property, RCW
61.24.040, and such parties may seek to enjoin the proceedings prior to the sale to
challenge ownership. RCW 61.24.130(1 ). Although failure to pursue presale
remedies does not constitute waiver of certain types of claims, the claimant under
such circumstances "may not seek any remedy at law or in equity other than
2
Selene RMOF II REO Acquisitions IL LLC v. Ward, No. 92967-0
(Yu, J., dissenting)
monetary damages." RCW 61.24.127(2)(b). The question of ownership is settled
following a trustee's sale carried out in compliance with chapter 61.24 RCW.
It is for this reason that purchasers at a trustee sale are permitted to utilize
the summary proceedings of unlawful detainer. Certainty of good title exists by
virtue of the trustee's deed, but this certainty evaporates for subsequent purchasers.
If LaSalle had conveyed the same property back to Vanessa Ward the day before it
conveyed the property to Selene, could we still say that Selene's special warranty
deed entitled it to summary proceedings to obtain possession?
Further, the majority's decision contains no limiting principle. It happens
that Selene is the first subsequent purchaser, but under the court's decision today
every new purchaser thereafter would receive the same right to utilize unlawful
detainer as if they were themselves the purchaser at the foreclosure sale. Majority
at 8-9 ("[B]ecause LaSalle conveyed its entire interest to Selene, Selene may
pursue the unlawful detainer action under RCW 61.24.060(1) to obtain possession
of the conveyed property."). Twenty years and ten subsequent purchasers later, the
holder of a deed on this property would presumably be able to initiate unlawful
detainer proceedings by relying on the original trustee's sale. The legislature could
not have intended such sweeping consequences.
In the record before us, LaSalle attempted to utilize the unlawful detainer
proceedings on two occasions but ultimately abandoned those efforts. Clerk's
3
Selene RMOF II REG Acquisitions JI, LLC v. Ward, No. 92967-0
(Yu, J., dissenting)
Papers at 50, 60. Instead, LaSalle sold the property to Selene by special warranty
deed in 2012. Doing so extinguished LaSalle's statutory right to utilize the
unlawful detainer proceedings through RCW 61.24.060(1). See Fed. Nat'l Mortg.
Ass 'n v. Ndiaye, 188 Wash. App. 376, 384, 353 P.3d 644 (2015) ("[U]nlawful
detainer is available to one who holds a title as a purchaser at a deed of trust
foreclosure sale.").
Accordingly, Selene must rely on the provisions of the unlawful detainer
statute itself-specifically, RCW 59.12.030(6). Under this provision, Selene must
show that Ward remained on the property "without the permission of the owner
and without having color of title thereto." RCW 59.12.030(6). Ward presents
color of title by way of her signed, partially notarized deed. Had this case
proceeded under RCW 59.12.030(6), the trial court would have either dismissed
the unlawful detainer action or converted the proceedings to a quiet title action so
that the question of ownership could be fully litigated. See Munden v. Hazelrigg,
105 Wash. 2d 39, 41, 711 P.2d 295 (1985); Puget Sound Inv. Grp., Inc. v. Bridges, 92
Wash. App. 523, 527, 963 P.2d 944 (1998).
Instead, the majority states that Ward "is foreclosed from asserting her title
challenge" because "the appropriate time to assert such challenge was prior to
foreclosure." Majority at 11. Our jurisprudence on this point is clear and certainly
may have determined the outcome of a quiet title action. Nevertheless, this
4
Selene RMOF II REG Acquisitions II, LLC v. Ward, No. 92967-0
(Yu, J., dissenting)
holding highlights another concern: that the remedies available to protect against
wrongful foreclosures are insufficient, particularly for low-income homeowners
faced with the daunting task of enjoining a trustee's sale without the aid of legal
counsel.
Ward's story is not unique in this regard. She seemingly attempted to assert
her challenge at the appropriate time, but her case was dismissed before the court
could adjudicate the merits. Am. Verbatim Report of Proceedings at 18, 21. The
remedies provided under chapter 61.24 RCW are not crafted for the pro se
homeowner in mind, resulting in prejudice against those low-income homeowners
most at risk of foreclosure. If Ward had had the benefit of legal counsel, this case
may have unfolded quite differently.
This lack of legal counsel is critical because RCW 61.24.130(1) does not
provide the same protections as the unlawful detainer statute. Under RCW
5 9 .12. 03 0( 6), color of title is sufficient to halt the summary proceedings to first
resolve the issue of ownership. The trial court acts as a safeguard for the rights of
the homeowner whose title may have been fraudulently transferred to the party
seeking possession. On the other hand, in nonjudicial foreclosure proceedings, the
burden rests with the homeowner to bring a lawsuit enjoining the trustee's sale.
While this certainly avoids '"time-consuming judicial foreclosure proceedings"'
and "' save [s] substantial time and money to both the buyer and the lender,"' the
5
Selene RMOF II REG Acquisitions IL LLC v. Ward, No. 92967-0
(Yu, J., dissenting)
lack of judicial oversight carries real consequences that may not, in practice, be
alleviated by the remedy provided under RCW 61.24.130(1). Majority at 6
(quoting Peoples Nat'! Bank of Wash. v. Ostrander, 6 Wash. App. 28, 31, 491 P.2d
1058 (1971)). A remedy that few can reasonably access in practice is no remedy at
all.
In sum, Selene had no statutory right to utilize unlawful detainer
proceedings through RCW 61.24.060(1). That right lay with LaSalle alone and
disappeared the moment LaSalle conveyed the property to a new owner. Selene
could access unlawful detainer proceedings only through RCW 59.12.030(6), and
Ward's signed, partially notarized deed gave her color of title sufficient to halt
those proceedings. It may be, in a separate quiet title action, that Selene's chain of
title prevails on account of Ward failing to enjoin the nonjudicial foreclosure
proceedings in 2009. Nevertheless, these facts highlight the very real possibility
that low-income homeowners cannot reasonably access the statutory remedies
designed to prevent wrongful foreclosures. For these reasons, I respectfully
dissent.
6
Selene RMOF II REO Acquisitions II, LLC v. Ward, No. 92967~0
(Yu, J., dissenting)
7