85 Wash. App. 129 | Wash. Ct. App. | 1997
In October 1993, the sheriff of Whatcom County sold at an execution sale the home of Leonard and Marjorie Van Beek. The sale satisfied a judgment Lois Hazel obtained against the Van Beeks in November 1983. On October 25, 1993, the sheriff mailed notice of the filing of the sheriffs return. November 2, 1993, was the 10th anniversary of the entry of the 1983 judgment against the Van Beeks. Fifteen days later and 23 days after the mailing of the notice of the sheriffs return of sale, the Van Beeks filed written objections to the sale. The trial court considered the objections, but rejected them and confirmed the sale. We hold that the objections were timely, but the confirmation of the sale was not. Accordingly, we reverse.
In early February 1981, Hazel contacted Leonard Van Beek, a general contractor, to discuss remodeling her home. Van Beek originally estimated that the remodeling would cost $25,000 to $35,000. He later revised that estimate upward to $35,000 to $40,000. Hazel authorized Van Beek to proceed with the job. By early 1982, Hazel had paid Van Beek over $90,000, but the work was still unfinished.
The Van Beeks then filed a Chapter 7 bankruptcy proceeding. Hazel sued them in bankruptcy court and obtained a judgment just over $59,000 on November 2, 1983. She then filed an abstract of judgment in Whatcom County Superior Court. Hazel also made a claim against Van Beek’s $4,000 contractor’s bond and garnished the Van Beeks’ bank account. Notwithstanding these actions, the judgment remained largely unsatisfied.
In August 1993, Hazel commenced execution sale proceedings to have the Whatcom County sheriff sell the Van Beeks’ residence to satisfy the unpaid amount of the 1983 judgment. Hazel was the successful bidder at the October 15, 1993 sheriffs sale. November 2, 1993, was the tenth anniversary of the entry of the 1983 judgment that served as the basis for the sale. On November 17, 1993, the Van Beeks filed written objections to the sheriff s sale. At a November 19 hearing on the motion to confirm sale, the court considered the objections, but orally denied them and ruled that an order confirming sale should be granted.
Prior to entry of that order, the Van Beeks filed another Chapter 13 bankruptcy proceeding, which ended in dismissal. In October 1994, after dismissal of the bankruptcy case, the court entered the order confirming the October 1993 sale. The Van Beeks appeal.
I
Timeliness of Objections
We must first resolve a threshold issue that neither party adequately addresses on appeal. Hazel argues that the trial court erred by considering the Van Beeks’ objections to confirmation. We disagree.
Two statutes are at issue. RCW 6.21.110(2) provides in relevant part:
The judgment creditor or successful purchaser at the sheriffs sale is entitled to an order confirming the sale at any time after twenty days have elapsed from the mailing of the notice of the filing of the sheriff’s return . . . unless the judgment debtor . . . shall file objections to confirmation with the clerk within twenty days after the mailing of the notice of the filing of such return.[2 ]
RCW 6.21.110(3) states in part:
If objections to confirmation are filed, the court shall nevertheless allow the order confirming the sale, unless on the hearing of the motion, it shall satisfactorily appear that there were substantial irregularities in the proceedings concerning the sale, to the probable loss or injury of the party objecting.
Here, the record shows the written objections were not filed within the 20-day period specified in RCW 6.21.110(2). The notice of the sheriff’s return was mailed on October 25, 1993. The Van Beeks filed their written objections on November 17, 1993, 23 days after the mailing of the notice of filing of the return. At a hearing on November 19, 1993,
In Erection Co. v. Department of Labor & Indus.,
The director [of the Department of Labor and Industries] must receive a dispute of the employability determination or formal plan, in writing, within fifteen calendar days from receipt of notification to the worker or employer.
The court held that an employee’s failure to meet this statutory deadline did not preclude consideration of a challenge received after the 15-day time limit expired. It concluded, having considered the word "must” in light of the statutory and regulatory scheme as a whole, that the Legislature did not intend the apparent mandatory language to divest the agency of discretion to consider a challenge received after the 15-day time limit expired.
We conclude from our review of the statutory scheme before us that the Legislature intended that the word "shall” in RCW 6.21.110(2) is directory, not mandatory. The statutes governing sales under execution were originally enacted in the late nineteenth century. But the 1987 amendments to RCW 6.21 show a legislative intent to protect the interests of judgment debtors in their property from improper sale procedures.
It is clear to us that the word "shall” in the statute was intended by the Legislature to be directory rather than mandatory. This is particularly appropriate here where the main challenge in the written objection was to the power of the court to confirm a sale after the underlying judgment on which the sale was based had expired.
We have found only one case that construes the timeliness of objection provision in this statute. In Krutz v. Batts,
We hasten to add that the case before us is one in which written objections were filed after the statutory deadline but before the hearing on confirmation of sale. We are not called upon to address other situations not presented by this fact pattern and decline to do so.
II
Timeliness of Confirmation
The Van Beeks’ main argument is that because the order confirming sale was entered after the expiration of the judgment lien’s statutory 10-year life, it is invalid. Hazel responds that a party seeking to execute on a judgment is required to obtain only a writ of execution, and not an order confirming sale, within the 10-year period. In addition, she contends the 1984 bankruptcy stay extended the life of the lien. We hold that the judgment lien in this case expired prior to the November 19, 1993 hearing to confirm the sale and was not extended by any bankruptcy proceeding.
At issue is the interpretation of the statutes governing
RCW 4.56.190 states that judgment liens shall "commence as provided in RCW 4.56.200 and . . . run for a period of not to exceed ten years from the day on which such judgment was entered . . . .”
after the expiration of ten years from the date of the entry of any judgment heretofore or hereafter rendered in this state, it shall cease to be a lien or charge against the estate or person of the judgment debtor. No suit, action or other proceeding shall ever be had on any judgment rendered in this state by which the lien shall be extended or continued in force for any greater or longer period than ten years.
Under these statutes, the judgment lien in this case expired on November 2, 1993. The superior court orally granted the motion to confirm the sale on November 19, 1993, 17 days later.
The trial court found that Hazel did not need to obtain the order confirming sale in order to complete execution for the purpose of these statutes. The Van Beeks contend that the confirmation of sale is an essential part of the execution and must be completed before the expiration of the judgment lien. We agree with the Van Beeks.
A judgment lien lives and dies by statute.
Hazel contends that Fogle’s Garage conflicts with RCW 6.17.020, which states that a judgment creditor "may have an execution issued for the collection or enforcement of the judgment at any time within ten years from entry of the judgment.” She thus urges us to reject the holding of Fogle’s Garage. We decline to do so.
First, Fogle’s Garage correctly points out that our Supreme Court has held that an execution sale, as well as issuance of the execution, must take place within the statutory life of the judgment.
Second, where possible, we must read statutes so as to harmonize them.
Hazel next argues that the life of the judgment lien tolled during the period of the 1984 bankruptcy stay.
In In re Marriage of Wintermute,
First, the court in Wintermute distinguished the lien at issue from a general judgment lien. The lien in Winter-mute was imposed to compensate the husband for the loss of the family home while allowing the wife to continue to live there. The court stated that the statutes limiting the enforcement of judgments to ten years do not apply to this type of lien.
We have previously described liens that equalize the division of property and are awarded against a specific piece of property as a form of equitable lien. When an equitable lien secures a debt, the creditor must take court action to subject the security to payment of the debt.[25 ]
The creditors in both cases were prevented from executing on the respective properties from the dates of inception of the liens by the terms of the decrees creating the liens.
Second, the fact that the husband in Wintermute was prevented from executing during eight years of the 10-year life of the lien figured significantly in the court’s decisión.
Hazel contends that Wintermute stands for a broad rule encompassing this case. While it is true that the Winter-mute court noted a bankruptcy petition might toll the statutory limitation
In In re Rury, the case cited by Wintermute for the proposition that a bankruptcy stay tolls the life of the lien, the court merely states that where a judgment is transformed into a valid claim in bankruptcy court, expiration of the life of the judgment under state statutes does not extinguish the claim for purposes of the bankruptcy court.
Hazel also suggests that the facts of this case place it within the exception created by our Supreme Court in Hensen v. Peter.
In Hensen, the judgment debtor obtained an injunction restraining the judgment sale approximately six months before the judgment was to expire. The sale took place over two years later, after trial, appeal, and dissolution of the injunction. The Hensen court indicated that where a judgment debtor pursues litigation "without merit” to prevent a judgment sale within the statutory life of the
In Weyerhaeuser Pulp Employees Federal Credit Union v. Damewood,
Hazel argues that the Van Beeks pursued meritless litigation as a delaying tactic by filing for bankruptcy twice after the judgment was entered. The record does not reflect facts to support this argument. The 1984 bankruptcy case was dismissed eight years prior to the expiration of the judgment. While the Van Beeks may have been attempting to escape the judgment by filing for bankruptcy, they could not have intended to prevent Hazel from executing by delaying execution until expiration of the judgment. This situation contrasts with Hensen, where the debtor obtained a TRO the day after the judgment sale was advertised, preventing sale for over two years during which time the statutory expiration date passed.
Further, extending the exception to this case would not be consistent with the equitable basis of the exception expressed in Hensen. Here, Hazel had ample opportunity to execute on her judgment prior to the expiration date of the lien. Once she commenced execution, the Van Beeks did nothing to prevent her from carrying it out.
Because we hold that the order confirming sale was in
We reverse the order confirming sale.
Kennedy, A.C.J., and Coleman, J., concur.
After modification, further reconsideration denied April 25, 1997.
Review granted at 133 Wn.2d 1009 (1997).
Our Lady of Lourdes Hosp. v. Franklin County, 120 Wn.2d 439, 443, 842 P.2d 956 (1993).
(Italics ours.)
121 Wn.2d 513, 518, 852 P.2d 288 (1993).
122 Wn.2d 801, 863 P.2d 64 (1993).
ITT, 122 Wn.2d at 807.
RCW 6.21.030(2).
RCW 6.21.030(1), RCW 6.21.040.
RCW 6.21.040.
18 Wash. 460, 51 P. 1054 (1898).
Krutz, 18 Wash, at 463.
See Hardin v. Day, 29 Wash. 664, 70 P. 118 (1902); Mueller v. Miller, 82 Wn. App. 236, 917 P.2d 604 (1996).
In re Electric Lightwave, Inc., 123 Wn.2d 530, 536, 869 P.2d 1045 (1994).
(Emphasis added.)
Mueller v. Miller, 82 Wn. App. 236, 247, 917 P.2d 604 (1996) (citing Grub v. Fogle’s Garage, Inc., 5 Wn. App. 840, 843, 491 P.2d 258 (1971)).
4 Wn. App. 874, 484 P.2d 458, review denied, 79 Wn.2d 1007 (1971).
82 Wn. App. at 247-48 (holding that sheriffs sale that occurred after the expiration of the 10-year period of the judgment lien was void).
Fogle’s Garage, 4 Wn. App. at 878-79; Packwood v. Briggs, 25 Wash. 530, 535, 65 P. 846 (1901); Hardin v. Day, 29 Wash. 664, 665, 70 P. 118 (1902); Long v. Smith, 125 Wash. 183, 215 P. 342 (1923).
Betz v. Tower Sav. Bank, 185 Wash. 314, 322, 55 P.2d 338 (1936).
In re King, 110 Wn.2d 793, 799, 756 P.2d 1303 (1988).
11 U.S.C. § 362(a)(2) provides that the filing of a petition under § 301, 302, or 303 of the bankruptcy act automatically stays the enforcement of any judgment obtained before the commencement of a bankruptcy case against the debtor or the property of the estate.
70 Wn. App. 741, 855 P.2d 1186 (1993), review denied, 123 Wn.2d 1009 (1994).
73 Wn. App. 818, 822, 871 P.2d 652 (1994).
Wintermute, 70 Wn. App. at 745-46.
73 Wn. App. at 822 (citations omitted).
Wintermute, 70 Wn. App. at 748.
Holmes v. Fanyo, 326 Ill. App. 624, 63 N.E.2d 249 (1945).
63 N.E.2d at 249-50.
An Illinois statute provided that the life of a judgment lien was seven years. 63 N.E.2d at 250. The judgment in the case was obtained on September 13, 1937, and the stay was vacated on September 13, 1944. 63 N.E.2d at 249-50.
Wintermute, 70 Wn. App. at 746 (citing In re Rury, 21 F.2d 881 (9th Cir. 1927), cert. denied sub nom. Mitchell v. Cunningham, 276 U.S. 614 (1928)).
Holmes, 326 Ill. App. 624, 63 N.E.2d 249 (1945).
Holmes, 63 N.E. 2d at 251-52 (citing Ill. Rev. Stat., ch. 77, § 2 (1943)).
3 Richard R. Powf.lt,, Real Property ¶ 482[1] (1991).
In re Estate of Eagleson, 172 N.J. Super. 98, 410 A.2d 1187 (six-month stay of execution sale following death of debtor did not apply where creditor had issued execution prior to the death), certification denied sub nom. American Nat’l Bank & Trust v. Estate of Eagleson, 420 A.2d 338, 84 N.J. 431 (1980); Knibb v. Security Ins. Co., 121 R.I. 406, 399 A.2d 1214 (1979) (whether surviving wife as joint tenant to real property becomes sole owner or takes property subject to unsatisfied judgment against her husband where property is levied but not sold prior to husband’s death).
Holmes, 63 N.E. 2d at 251-52; In re Harbin, 25 B.R. 703 (Bankr. W.D. Tenn. 1982) (citing Tenn. Code Ann. § 25-5-106 (1980)), superseded by statute as noted in Weaver v. Hamrick, 907 S.W.2d 385, 390-91 (Tenn. 1995) (holding that 1994 version of § 25-5-106 does not provide for suspension of the judgment lien enforcement period when a bankruptcy proceeding has stayed execution). See also North Carolina Joint Stock Land Bank v. Bland, 231 N.C. 26, 56 S.E.2d 30, 35 (1949) (citing G.S. § 1-234); Federal Land Bank v. United States, 21 A.D.2d 936, 250 N.Y.S.2d 999 (1964).
95 Wash. 628, 164 P. 512 (1917).
95 Wash, at 637.
11 Wn. App. 12, 521 P.2d 953 (1974).
Weyerhaeuser, 11 Wn. App. at 15-16.
Weyerhaeuser, 11 Wn. App. at 16.
Hensen, 95 Wash, at 629.
