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580b. (a) Except as provided in subdivision (c), no deficiency shall be owed or collected, and no deficiency judgment shall lie, for any of the following:
(1) After a sale of real property or an estate for years therein for failure of the purchaser to complete his or her contract of sale.
(2) Under a deed of trust or mortgage given to the vendor to secure payment of the balance of the purchase price of that real property or estate for years therein.
(3) Under a deed of trust or mortgage on a dwelling for not more than four families given to a lender to secure repayment of a loan that was used to pay all or part of the purchase price of that dwelling, occupied entirely or in part by the purchaser. For purposes of subdivision (b), a loan described in this paragraph is a "purchase money loan."
Read more ›Held: When a taxpayer sells or disposes of property encumbered by a nonrecourse obligation exceeding the fair market value of the property sold, as in this case, the Commissioner may require him to include in the "amount realized" the outstanding amount of the obligation; the fair market value of the property is irrelevant to this calculation..............
Read more ›Section 580b places the risk of inadequate security on the purchase money mortgagee. A vendor is thus discouraged from overvaluing the security. Precarious land promotion schemes are discouraged, for the security value of the land gives purchasers a clue as to its true market value................
Read more ›We must decide whether, notwithstanding the protection against deficiency judgments conferred by Code of Civil Procedure section 580b (hereafter section 580b), a purchaser may waive, by contract term, that protection in exchange for new consideration following the original purchase money sale.[1] There is a conflict in state law on this question, with Russell v. Roberts (1974) 39 Cal.App.3d 390, 114 Cal.Rptr. 305 holding that waiver is available, but Palm v. Schilling (1988) 199 Cal.App.3d 63, 244 Cal.Rptr. 600 holding that it is not.
We conclude that the statutory provision may not be waived in the circumstances of this case, and hence we affirm the Court of Appeal's judgment and disapprove Russell.............................
Read more ›After a careful consideration of this argument, we conclude that it must be rejected as without merit. First as to section 580b, its protection against a deficiency judgment is extended to the successors in interest of the original mortgagor or trustor notwithstanding an express assumption of the indebtedness...................
Read more ›The ultimate issue is whether East: Bay has any claim against Prestige in the bankruptcy case. To make this determination three issues need to be addressed:
1) Prestige argues that East Bay's unsecured claim must be disallowed because it is not timely filed.
2) Prestige also argues that East Bay unsecured claim must be disallowed because the violation of § 726(a) of the California Code of Civil Procedure leads to the loss of both East Bay's security and its unpaid debt.
3) Finally, Prestige argues that East Bay's claim must be disallowed because the underlying note is a non-recourse purchase money note and is therefore unenforceable pursuant to § 580b of the California Code of Civil Procedure.............................
Read more ›Thus, in the light of Brown, supra, 41 Cal.2d 193, this court is forced to hold that where a contract for the sale of land is used as a security device, a defaulting vendee is not subject to any personal liability which would be in the nature of a deficiency judgment..................................
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