Trustee's Sales / Interpleader
Tuesday, June 19, 2018
Placer Foreclosure, Inc. v. Aflalo
Cal.App. 2nd Dist. (B268589) 5/30/18
Placer Foreclosure, acting as trustee, conducted a trustee's sale of property owned by Aflalo. The sale resulted in surplus proceeds. When Aflalo filed an action against Placer and the third-party buyer for wrongful foreclosure and quiet title, Placer filed a complaint in interpleader and deposited the surplus proceeds with the court. The court affirmed a judgment of dismissal after Aflalo's demurrer was sustained and remanded with instructions to release the interpleaded funds to Aflalo. Placer did not face a valid threat of double liability because the purchaser's claim was against Aflalo, not Placer. If the wrongful foreclosure action invalidated the sale, the third party would be entitled to a refund from Aflalo of its purchase proceeds.