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Code of Civil Procedure 873.010 CCP – Appointment; power and duty of court (Partition Actions)

California Code of Civil Procedure 873.010 is the California partition statute that describes the power and duty of a partition referee as appointed by the court. The statute provides that:

(a) The court shall appoint a referee to divide or sell the property as ordered by the court.
(b) The court may:
(1) Determine whether a referee’s bond is necessary and fix the amount of the bond.
(2) Instruct the referee.
(3) Fix the reasonable compensation for the services of the referee and provide for payment of the referee’s reasonable expenses.
(4) Provide for the date of commencement of the lien of the referee allowed by law.
(5) Require the filing of interim or final accounts of the referee, settle the accounts of the referee, and discharge the referee.
(6) Remove the referee.
(7) Appoint a new referee.

California Code of Civil Procedure 873.010

The trial court shall appoint a referee

The most important part of this statute is the mandate that “The court shall appoint a referee to divide or sell the property as ordered by the court.”[1]Code of Civil Procedure 873.010(a) This gives the court no discretion to turn down the appointment of a referee so long as the plaintiff is indeed entitled to partition. In most cases, the right to partition is absolute such that the court will be required to enter a judgment of partition appointing a referee, usually to market and sell the property.[2]Code of Civil Procedure 872.720

This statute dovetails with California Code of Civil Procedure 873.060 providing that: “The referee may perform any acts necessary to exercise the authority conferred by this title or by order of the court.” In turn: “The referee or any party may, on noticed motion, petition the court for instructions concerning the referee’s duties under this title.” California Code of Civil Procedure 873.070.

The Argument that a Referee is Unccessary Deemed Frivolous and Sanctionable

The word “Shall” in this section is hardly a suggestion. Rather, in one unpublished case, the appellant argued to the contrary and was sanctioned and reported to the State Bar as follows:

[Appellant] argues that the appointment of a referee has added an unnecessary expense to the sale of the property and has unnecessarily complicated the sale process. Her primary concern, however, appears to be that the sale should not go forward in a depressed real estate market on all-cash terms. She explains in her opening brief on appeal, “The purpose of this appeal, filed on September 17, 2009 was (and still is) to delay the Referee’s ‘fire sale’ of the Property until the then (and to a lesser extent still) dire condition of the real estate market improves.” She seeks to accomplish this by having the property listed for sale directly through “an independent real estate broker given time to explore alternatives, as opposed to an all cash auction in a down market.” She argues further that her views on how to market the property should prevail because she has paid the costs of maintaining the property and, “He who pays the piper calls the tune.”

Haverland makes no effort to show either legal error or a prejudicial abuse of discretion. Her mere disagreement with the trial court’s decision is not grounds for reversal.

We conclude that the decision to appoint a referee was reasonable. The appointment of a referee can provide substantial benefits to the court and the parties. A referee can make recommendations to the court concerning the manner, terms, and conditions of sale, including whether to conduct a public auction or private sale. (Code Civ. Proc., §§ 873.520, 873.610, subd. (b).) The referee must provide notice of the sale in the same manner required for notice of sale by execution. (Id., § 873.640.) The referee also must provide a detailed report to the court after the sale and prior to the court’s confirmation of the sale. (Id., § 873.710.) At the hearing to confirm the sale, the court may either confirm the sale or vacate the sale if certain findings are made, or the court may vacate the sale and accept an increased offer by a responsible bidder at the hearing. (Id., § 873.730, 873.740.) The trial court reasonably concluded that these and other benefits of the appointment outweighed the costs.

The Appeal Is Frivolous and Was Taken Solely for Delay, and a Monetary Sanction Is Warranted

An appellate court may award attorney fees incurred on appeal as a monetary sanction against the appellant if “it appears to the reviewing court that the appeal was frivolous or taken solely for delay.” (Code Civ. Proc., § 907; see Cal. Rules of Court, rule 8.276(a).) An appeal is frivolous if “any reasonable attorney would agree that the appeal is totally and completely without merit.” (In re Marriage of Flaherty (1982) 31 Cal.3d 637, 650.)

We conclude that any reasonable attorney would agree that Haverland’s disagreement with the trial court’s decision to appoint a referee in these circumstances is not grounds for reversal and that her appeal seeking de novo review of that decision, without arguing any legal error or abuse of discretion, is totally and completely without merit. Her arguments against the appointment of a referee do not come close to establishing an abuse of discretion and are indisputably without merit. Moreover, she cites no authority supporting de novo review of the decision and offers no colorable argument for de novo review.

Statements made in Haverland’s opening and reply briefs on appeal suggest that this appeal was taken solely to delay the sale of the property in the hopes that the market value would increase. She stated in her opening brief, “The purpose of this appeal, filed on September 17, 2009, was (and still is) to delay the Referee’s ‘fire sale’ of the Property until the then (and to a lesser extent still) dire condition of the real estate market improves.” She stated in her reply brief, “Putting the Property on the market late last year, when Los Angeles real estate was near or at the bottom, was (to put it charitably) unwise, but the worst was averted by this appeal.”

We do not doubt that these statements were not intended to be admissions that the appeal was taken solely for delay, and the first statement could be construed differently. Haverland opposed the appointment of a referee in the trial court largely because she believed that a real estate broker hired directly by the court might wait for property values to increase before selling the property. She seeks to achieve that same result on appeal through a reversal of the order appointing a referee with directions to the trial court to appoint a real estate broker instead. Thus, the stated purpose of the appeal could be to delay the sale through her success on the merits. The second statement, however, suggests that the appeal had already achieved some of the desired result—delay—months before the filing of this opinion, and therefore is more difficult to explain away. Moreover, the frivolousness of her argument on appeal suggests that delay was the motive, rather than a good faith belief in the validity of the appeal. (In re Marriage of Flaherty,supra, 31 Cal.3d at p. 649; Town of Woodside v. Gava (1989) 213 Cal.App.3d 488, 494.) On balance, we conclude that the appeal is frivolous and was taken solely for delay.

A monetary sanction against Haverland and her counsel is warranted in the amount of respondents’ attorney fees incurred on appeal, $8,840, payable to respondents.

Haverland v. Badal (Cal. Ct. App., Oct. 6, 2010, No. B219093) 2010 WL 3898556, at *3–5

The appellate court was not messing around, concluding that: “The interlocutory judgment is affirmed. The motion for a monetary sanction is granted. Haverland and her counsel, jointly and severally, are ordered to pay respondents $8,840 within 30 days after the issuance of our remittitur. The clerk of this court is ordered to send a copy of this opinion to the State Bar of California upon the issuance of our remittitur (Bus. & Prof.Code, § 6086.7, subd. (a)(3)), and counsel for Haverland is ordered to send a copy of this opinion to the State Bar within 30 days after the issuance of our remittitur (id., § 6068, subd. (o)(3)). Respondents are entitled to recover their costs on appeal.” Haverland v. Badal (Cal. Ct. App., Oct. 6, 2010, No. B219093) 2010 WL 3898556, at *3–5.

Suffice to say, the Court of Appeal has not taken kindly to parties raising frivolous objections to an interlocutory judgment of partition by claiming that a referee is not necessary.

Law Revision Commission Comments to California Code of Civil Procedure § 873.010

In 1976, the California Law Revision Commission explained California Code of Civil Procedure § 873.010 as follows:

Section 873.010 sets out some, but not all, of the court’s powers with respect to the referee.

Subdivision (a), providing for court appointment of a single referee, supersedes provisions of former Section 763 that required the consent of the parties for the appointment of a single referee.

Subdivision (b)(1) is new. Whether a bond is required depends on the circumstances of the case.

Subdivision (b)(2) is new; it gives express recognition to the instructions procedure. It is a valuable tool for resolving ambiguities and matters not otherwise covered and, if properly used, serves to expedite the action. See also Section 873.070 (petition for instructions).

Subdivision (b)(3) states the substance of former Section 768 in providing for court allowance of fees and expenses of referees. See Section 874.010 and Comment thereto (costs incurred in partition action).

Subdivision (b)(4), permitting the court to fix the date of commencement of the lien of the referee (see Section 874.120), is new. It protects the referee in case of later settlement and dismissal of the action. For authority of the court to fix the date of commencement of liens of third persons furnishing services, see Section 873.110.

Subdivision (b)(5) is new. It recognizes the need for and practice of the court to receive and pass upon the account and final report of the referee and thereafter to discharge the referee. This applies particularly in, but is not limited to, sales transactions.

Subdivision (b)(6) restates the substance of the introductory portion of former Section 766. It broadens this provision to apply to the referee for sale as well as for division.

Subdivision (b)(7) is new; for specific provisions authorizing appointment of a new referee, see Sections 872.630(b) (new referee for determination of interests of lienholders) and 873.290(b) (new referee for preparation of new report on division). See also Sections 873.730 and 873.740 (authority of court to order new sale).

Talkov Law's Partition Attorneys Can Help

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References

References
1 Code of Civil Procedure 873.010(a)
2 Code of Civil Procedure 872.720
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