Filed 7/16/15 Lesh v. Llewellyn Properties CA2/1

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

DARLA LESH et al., as Trustees, etc.,

Plaintiffs and Appellants,

v.

LLEWELLYN PROPERTIES, LLC, et al.,

Defendants and Respondents.

 B250364

 (Los Angeles County

 Super. Ct. No. BC476163)

APPEAL from a judgment of the Superior Court of Los Angeles County, William 

F. Fahey, Judge. Reversed with directions.

Wilton & Associates and Ronald D. Wilton for Plaintiffs and Appellants.

Hennelly & Grossfeld, Michael G. King and Ryan R. Jike for Defendant and 

Respondent Llewellyn Properties, LLC.

Fidelity National Law Group and Kevin R. Broersma for Defendant and 

Respondent Anchor Fund, LLC.

________________________________________
2

This appeal involves competing claims to a single family residence located at 4616 

South Van Ness Avenue, Los Angeles (the Property). The plaintiff successor trustees, 

Darla Lesh (Lesh) and Betty Wilton (Wilton) (plaintiffs), claim title through purchase of 

the Property in 1970 by their father, Edward Weiss (Weiss) in the name of Margaret 

Stensrudda (Stensrudda), as well as through their parents’ and the Weiss Revocable 

Living Trust’s (Trust)1 possession of the Property until 2011, when defendant Llewellyn 

Properties, LLC (Llewellyn) purchased the Property. Plaintiffs concede that Weiss’s 

acquisition of the Property was based on fraud because Margaret Stensrudda never 

existed; according to what Weiss told Lesh, he put the Property in Stensrudda’s name so 

that he could buy it cheaper and earn a broker’s commission. Llewellyn purchased the 

Property in 2011 through a grant deed that the parties acknowledged was forged.2

The trial court ruled in favor of Llewellyn on two grounds: (1) plaintiffs did not 

have standing to bring the claims herein and “no legal claim to ownership” because 

Weiss’s statement to Lesh about his putting the Property in Stensrudda’s name was 

inadmissible hearsay, “no public record calls into question the existence of Stensrudda,” 

Lesh was not credible and the court did not credit the documents showing that Weiss or 

the Trust paid money into escrow at the time of purchase and the Property’s expenses,

1 In the original complaint, the Trust, which is a family trust, was the plaintiff. We 

take judicial notice of the superior court file in this case, which includes demurrers to the 

original complaint in which defendants argued that a trust cannot bring suit in its own 

name. A first amended complaint was subsequently filed naming Lesh and Wilton as 

successor trustees and plaintiffs, although the Trust is still listed as the plaintiff in the 

caption. Notwithstanding this procedural history, the opening brief names the Trust as 

the appellant and plaintiff below, and merely lists Lesh and Wilton as interested persons 

in the Certificate of Interested Entities or Persons. We observe that the notice of appeal 

in this case was filed in the names of the Trust, Lesh, and Wilton.

2 Defendant Anchor Fund, LLC (Anchor), is the assignee of an assignment of deed 

of trust recorded on May 27, 2011, in favor of Anchor Loans, Inc., which had provided 

Llewellyn funding to purchase the Property. Llewellyn’s owner, Ryan Nichols, 

personally guaranteed that loan. Anchor Loans was a defendant below but was dismissed 

prior to trial and is not a party to this appeal. The parties stipulated at trial that Anchor 

held the beneficial interest in the deed of trust that plaintiffs sought to cancel.
3

and rented out the Property; and (2) the equities did not favor plaintiffs because Weiss’s 

fraud constituted unclean hands and Weiss’s fraud and Lesh’s failure to correct the public 

records caused the forgery to happen to Llewellyn’s prejudice.

We disagree. The evidence of Weiss’s and the Trust’s possession of the Property

gave rise to a rebuttable presumption of ownership under Evidence Code sections 637 

and 638, thus giving plaintiffs standing to bring the claims herein and requiring 

defendants to come forward with evidence that Stensrudda was a real person, which they 

admitted at trial they could not. Third, Llewellyn cannot take good title through a forged 

deed and substantial evidence did not support the trial court’s conclusion that Weiss’s 

putting the Property in Stensrudda’s name decades earlier caused or allowed the forgery 

to happen.

Although we do not condone Weiss’s fraud and Lesh’s failure to correct her 

father’s transgression, for the reasons set forth below, we reverse the judgment and

remand the case with directions to cancel the grant deed recorded on May 6, 2011, 

conveying the Property to Llewellyn Properties LLC and the assignment of deed of trust 

recorded on May 27, 2011; order defendants to deliver possession of the Property to 

plaintiffs; declare that plaintiffs have a fee simple interest in the property; and try the 

parties’ competing claims for monetary relief, that is, plaintiffs’ claims for money 

damages and defendants’ offset defenses.

PROCEDURAL AND FACTUAL BACKGROUND

Summary of proceedings below

The Trust filed the original complaint on December 30, 2011, and plaintiffs filed

the operative first amended complaint (FAC) on April 10, 2012.

3 The causes of action 

that survived by the time of trial were: cancellation of deed; quiet title; trespass (against 

Llewellyn only); ejectment (against Llewellyn only); and declaratory relief.4 In their

3 See ante, footnote 1.

4 The trial court sustained a demurer to plaintiffs’ cause of action for imposition of 

constructive trust.
4

prayer for relief, plaintiffs sought, among other relief, cancellation of Llewellyn’s grant 

deed, cancellation of Anchor’s assignment of deed of trust, general, special and punitive 

damages, including the reasonable value of rents and profits since Llewellyn bought the 

Property, delivery of possession of the Property, and a declaration and judgment 

“confirming Plaintiffs’ fee simple interest in the Property.”

In its first amended answer to the FAC, Llewellyn asserted, among other defenses, 

that it was a bona fide purchaser, plaintiffs lacked standing or capacity to sue, estoppel 

and waiver, unclean hands, unjust enrichment, damages caused by plaintiffs’ negligence, 

fraud of a third party, set-off for good faith improvement under Code of Civil Procedure 

sections 741and 872.430, partition by sale, and equitable distribution of proceeds.

Anchor’s answer made similar claims.

The trial court conducted a bench trial on December 3 and December 4, 2012. As 

detailed below, at trial, plaintiffs proffered documentary evidence and the testimony of 

Lesh, the purported notary of Llewellyn’s deed of trust, Albert Oviedo (Oviedo), Darren 

Wells (Wells), who had assisted Llewellyn in identifying the Property for investment, and 

Ryan Nichols (Nichols), Llewellyn’s owner and manager. Llewellyn proffered Nichols’s 

testimony as well as documents, including the public records indicating Stensrudda was 

the owner of the Property. The parties stipulated at trial that Margaret Stensrudda was 

not an “aka” of Edward Weiss.

After receiving the parties’ posttrial briefs, on February 11, 2013, the trial court 

issued its proposed statement of decision in favor of Llewellyn and Anchor. Plaintiffs 

filed objections to the proposed statement of decision on February 25, 2013, which the 

court overruled on February 26, 2013. The court issued its final statement of decision on 

February 26, 2013.

On April 2, 2013, the court entered judgment in favor of Llewellyn and Anchor. 

The judgment recited that “Plaintiff Trust [sic] shall take nothing by way of its First 

Amended Complaint against Defendants”; declared that Llewellyn “held an interest in 

[the Property] as a fee simple owner, the basis of which is a Grant Deed that was 

recorded . . . on May 6, 2011” and that Anchor “held an interest in [the Property], the 
5

basis of which is an Assignment of Deed of Trust that was recorded . . . on May 27, 

2011”; and “Plaintiff Trust [sic] owns no right, title, estate, lien or interest in [the 

Property].” The court awarded Llewellyn costs in the amount of $7,309.78 and costs to 

Anchor according to proof.5 Llewellyn gave notice of entry of judgment on June 4, 2013, 

and plaintiffs filed this appeal on July 31, 2013.

On June 2, 2015, pursuant to Government Code section 68081, we requested 

responses to the following question: “Was Weiss’s statement to Lesh about Stensrudda 

and the subject real property admissible as a declaration against interest” under Evidence

Code section 1230? We received the parties’ timely responses.

Evidence regarding the Trust’s claim of ownership to the Property

On August 14, 1970, the probate court approved sale of the Property by the Estate 

of Kay Kaumeyer to Margaret Stensrudda for $12,000 in cash. The probate court also 

approved payment of a $600 commission to Weiss, who was a licensed real estate broker.

Weiss withdrew $10,885 from his own account on November 16, 1970, and obtained a 

cashier’s check for $10,885 payable to the Estate of Kay Kaumeyer.

The escrow statement dated November 19, 1970, reflects a credit in that same 

amount and the statement recites that it was sent to “Margaret Stensrudda c/o Edward 

Weiss” at the same address of 1414 Vermont Avenue that Lesh testified was an office 

address for her parents’ real estate business. A handwritten note on the customer copy of 

the cashier’s check states that the monies came from Weiss’s personal account at Security 

Pacific Bank and contains a handwritten escrow account number that is the same as the 

number on the escrow statement.

The grant deed recorded on November 19, 1970, lists Margaret Stensrudda as the 

grantee, and Kenneth B. Kober, executor of Kay Kaumeyer’s estate, as the grantor. A 

“Statement of Information” apparently provided to the title insurance company recites 

that Margaret Stensrudda was born in Missouri in 1923 and lists addresses for her in 

Pacoima, California, New York, and 5750 West First Street in Los Angeles. It recites 

5 Ultimately, the court awarded Anchor $3,602.73 in costs.
6

two dates, February 4, 1969, and October 15, 1970, near a signature for “Margaret 

Katrina Stensrudda.”

Lesh and Wilton are Weiss’s and his wife Beatrice’s daughters. Edward and 

Beatrice died respectively in 2006 and 2009. Lesh is a graduate of UCLA and was a

licensed real estate broker for “15, 20 years.”

Lesh testified that Edward Weiss along with Beatrice owned and managed over 80 

rental properties in his lifetime. Lesh first started working for her parents in that business 

in the late 1970’s when she was 16 or 17, and began working for them full time after she 

graduated from college in the early 1980’s. Her father taught her “the business,” which 

she ultimately managed. She learned from her father, and later on was responsible for 

“what forms to use for rental purposes, for lease purposes,” how to fill out rent cards, 

doing evictions, reconciling the Security Pacific Bank statements and later on statements 

from Bank of America, maintaining the properties, and paying the tax and other bills for

the properties.

She testified at length about where the business records were stored, generally at 

the office with older files kept in her father’s home, and whether files were maintained 

under the name of the property or a workman. Later on, she conceded that there were a 

lot of records in file cabinets dispersed throughout her parents’ home, including in her 

father’s office and the garage, and that it would take a “long, long” time to go through all 

of them because the records went back 40 years. She clarified, however, that although all 

the records for the Property were not in one file, the rental agreements for the Property 

were in a separate file and the tax records for the properties were also segregated.

Upon cross-examination by Llewellyn’s counsel, she acknowledged that because 

she searched only for “antiquated documents,” she could not testify whether or not she 

had produced all documents related to the Property even though she knew that ownership 

was at issue.

Lesh’s parents established the Trust in 2006. About 80 or 90 properties, including 

the Property, owned by Weiss were placed in the Trust. The grant deed placing the 
7

Property in the Trust lists as grantor Edward Weiss “aka MARGARET 

STENSRUDDA” and Weiss and his wife as trustees of the Trust but was not recorded.

Lesh also testified about the use of the Property. Since its acquisition in 1970, the 

Property was leased to tenants until it was acquired by Llewellyn. The rental agreements 

were always written; she identified her father’s signature and handwritten notations on 

the rental agreements.

The first rental agreement was dated August 18, 1970, and is on Weiss’s stationery

reciting the 1414 Vermont Avenue address; Gloria Starks is listed as the tenant and the 

agreement contains what purports to be Starks’s signature. The next rental agreement of 

record was dated April 21, 1977. Weiss appears on the agreement as “Landlord” and 

Mozell and Sharron Mack as “Tenant[s].” In the record is also an option to buy the 

Property dated October 1, 1976, that listed Weiss as the “Optionor.” A June 22, 1982 

rental agreement listed Weiss as the owner and landlord. A rental agreement dated

March 16, 1987, was signed by Weiss as landlord. This agreement is also accompanied 

by an option to buy and Weiss again appeared as the “OPTIONOR.” The last rental 

agreement of record was dated September 5, 2008. Weiss appeared as owner and 

landlord. Lesh testified that the tenants remained on the Property until 2011. There was

no mention of Stensrudda on any of these rental agreements.6

Los Angeles County issued a tax bill on the Property to Stensrudda and the 

Property was insured under that name. Although at trial Lesh proffered only a few 

documents evidencing her payment of property tax bills in the early 1980’s and in 2011 

and 2012, she testified that the property taxes were never delinquent and that her father 

paid the property tax bills. She knew this because she “help[ed] organize the tax bills” 

and made “sure that everything was added together and whatever else needed to be done 

to pay the taxes.” She also testified that she has been paying the property tax bills even 

6 While it is not clear whether these five rental agreements cover the entire period 

from 1970 to 2011, the roughly 20-year break between the fourth and fifth rental 

agreements may be explained by Lesh’s testimony that one of the tenants remained in the 

Property for 21 years.
8

after Llewellyn purchased the Property in 2011. There was no testimony that anyone 

other than Weiss or Lesh paid the property tax bills.

She further testified that Weiss or she and “no one” else paid the fire and liability 

insurance on the Property and that paying those bills was part of her “job responsibility.” 

The insurance company never returned her check for payment of insurance on the 

Property, and “we paid the insurance every single year on the Property.” Also in the 

record were repair bills for the Property from 1972, 1974, and 1983 addressed to Weiss.

Lesh became aware of “Margaret Stensrudda” when in the late 1970’s or early 

1980’s, she was paying the insurance for the first time on the Weiss properties. She 

testified that when she saw Stensrudda’s name, she concluded that something was 

“definitely wrong because we only exclusively take care of our own property.” She 

further testified that when she saw Stensrudda’s name, she thought that she needed to talk 

with her father because she questioned why her family would be “paying for insurance or 

taxes or anything else for this person.” She explained that she was curious if Stensrudda 

was a “long lost” sister because her father did not talk much about his side of the family.

After seeing Stensrudda’s name on the bill, Lesh “immediately” spoke with her 

father and asked about Margaret Stensrudda. Over Llewellyn’s hearsay objection, the 

court provisionally permitted Lesh to testify about her father’s response.

She testified that Weiss told her he had made up the name “Stensrudda” to buy the 

Property at a better price at probate “because he was getting bid-up on many different 

properties” and when people saw his name, they became more interested in the Property

because he was known to identify “‘good deal[s].’” “He wasn’t proud of what he did. 

He wasn’t happy about what he did. He said it was the wrong thing to do. He said he 

received a commission that he shouldn’t have received, and it wasn’t worth it.”

Lesh testified that she spoke with her father more than once about Margaret 

Stensrudda and his explanation of why the Property was in Stensrudda’s name did not 

change over time. She added that “this” was dinner conversation at the family table 

many times, and that her father had told her he had done the same thing when he had 

purchased a different property in the name of “Marianna Christmas.” Upon counsel for 
9

Llewellyn’s cross-examination, Lesh answered affirmatively to counsel’s inquiry as to 

whether her father had used a fake name to purchase other properties under 

“circumstances similar to the ones found here.” Wilton did not testify even though 

plaintiffs’ counsel was her husband.

Eventually, the court ruled that Weiss’s statements to Lesh about Stensrudda were 

inadmissible under the hearsay exception for family history in Evidence Code section 

1310 and considered the statements for the limited purpose of demonstrating that

Stensrudda was not a member of the Weiss family.

Lesh also testified that no one outside the Weiss family knew that Weiss was 

Stensrudda. Lesh admitted that she was aware of the fact that title to the Property was 

listed in Stensrudda’s name, and that neither she nor her sister took steps after their

father’s death to change the title to reflect Weiss’s ownership.

With respect to Llewellyn, Lesh testified that the first indication of trouble was 

after the tenant had vacated the Property in 2011 when she “sent someone over to get . . .

a painting estimate” “on work.” That person called her to inform her that somebody else 

was doing “‘rehab work’” on the Property. She recalls being “frantic” and trying to get 

contact information from the person at the job site so as to “find out who the owner of the 

Property was so that I could contact them immediately to have them stop work.”

She recounted that in the first week of July 2011 she spoke with Wells and 

informed him that “we were the owner of the Property” for “40-plus years,” told him to 

stop work and to consult his title insurance company, and that she was going to refer the 

matter to her attorney. When she did not hear from Wells, she caused a trespass notice to 

be posted on the Property. She later found out that the Property was up for sale in 2012, 

and she contacted the brokers to tell them not to sell the Property because there was an 

issue with title. She never obtained possession of the Property after that and has not been 

paid rent since July 2011. She stated that she learned about Nichols only after the lawsuit 

was filed.
10

Upon redirect, she testified that during the time period starting in the 1970’s until 

her mother passed away in 2009, she was never aware that any properties owned by her 

parents “were taken by way of a forged deed.”

Evidence regarding Llewellyn’s claim to the Property

Llewellyn is a California limited liability company. Nichols testified that he is an 

investor in real estate and rehabilitates or “flip[s]” houses. He described his investment 

strategy: “[Y]ou buy a property that is under valued because of its condition below the 

comps, and then I invest money into rehabilitating it so that it can be sold at the—at the 

top value comps.” This was his intent with respect to the Property.

Nichols found the Property through Wells. Wells had learned about the Property 

from Juan Michael (Michael). Nichols also spoke with Michael about the Property;

Michael was a finder of properties for investors. The total amount of the finder’s fee that 

Nichols agreed to pay was $18,000. Michael received a $6,000 finder’s fee and “Simple 

Strategies” received $12,000. Nichols did not know what Simple Strategies was but 

thought it was “[j]ust another finder.” Nichols did not know whether Michael was 

representing the seller.

The Property came to Nichols as “pre-packaged deal” from a wholesaler, that is, it 

was offered at $115,000, take it or leave it. Nichols never looked at the Property before 

he signed the purchase agreement.7 Nichols did pay $115,000 for the Property. Wells 

testified that he estimated the Property’s market value after renovation to be between 

$230,000 and $240,000.

Nichols stated that he obtained a loan through former defendant, Anchor Loans, 

Inc., which he personally guaranteed. He converted the Property from a two bedroom, 

one bath to a three bedroom, two baths house. Nichols’s company, Invictus, lent 

Llewellyn approximately $35,000 to renovate the Property. Nichols also testified that he 

7 Nichols’s testimony was not entirely clear in this regard. Upon crossexamination by his counsel, Nichols testified that he first saw the Property “within a day 

or two of talking to Darren” Wells.
11

was losing money every month on the Property because of the Anchor loan and his 

inability to rent the Property.

He stated that he was not present when the signature from Margaret Stensrudda 

“appeared” on the purchase agreement for the Property. No broker for Stensrudda was 

listed on the agreement either; the space for identifying the seller’s broker was blank. 

Although the broker listed on the agreement was someone named Mack, Mack did not 

find the Property for Nichols. Nichols, however, had met Mack before but not in 

connection with the Property.

According to Nichols, no one seemed to be representing the seller in the 

transaction. When asked whether he thought that was odd, Nichols answered: “I 

assumed it was [Michael] and Simple Strategies that had a deal together, but, yeah.” 

When asked if anyone in the entire transaction had indicated that they had communicated 

with Margaret Stensrudda, Nichols replied: “Well, I know that [Michael] said he was 

getting the sellers to sign it. That’s what I know. I didn’t know if they had an official 

meeting.” Neither Wells nor Nichols ever spoke with or met with a person named 

Stensrudda. Nichols explained that Michael told him that “he was getting the sellers to 

sign it.” Michael did not testify at trial.

When asked to confirm that he was aware of “a problem with the acquisition” at 

the time he borrowed the money from Invictus to renovate the Property, Nichols said that 

he was not aware of a problem “because I had done my research, and there was no Ms. 

Stensrudda and there was no contact.”

Oviedo testified that he was a notary working for the Los Angeles County 

Superior Court and that the signature purporting to notarize Llewellyn’s grant deed was 

not his; the stamp, however, was his. He further testified that he was always in 

possession of his stamp and never “authorized” anyone to use it. He did not notarize 

Llewellyn’s grant deed and there was no entry in his notary journal that reflected this 

notarization. Oviedo never heard of Margaret Stensrudda.

In response to the court’s question as to what was “the defense’s theory as to who 

Ms. Stensrudda is,” Anchor’s defense counsel conceded that he could not say who she “is 
12

specifically.” He then stated: “[W]e don’t have a proffer as to who she was. We felt that

it is the plaintiff’s burden to show that she didn’t exist.” Llewellyn’s counsel conceded 

that “we don’t know whether or not Ms. Stensrudda herself existed.” Nichols also 

testified that he had no documentation or evidence to refute that “Margaret Stensrudda” 

was a name made up by Weiss.

Wells testified as to his bringing the deal to Nichols. He never went inside the 

Property when he first spoke with Nichols although he was aware that it was occupied. 

He said that he contacted Michael to make sure that the Property was going to be vacant 

prior to the close of escrow. He also testified that after seeing the notice that Lesh 

identified in her testimony, he told Nichols that “we are going to continue working.” 

After talking with Nichols, work stopped on the Property for awhile. He conceded that 

he never spoke with Stensrudda and was not aware that “anybody in this transaction” had 

done so, although he had seen her name when he conducted a title search. He further 

testified that between the time he first spoke with Lesh and stopping work on the 

Property, “we thought maybe this could be a fraudulent deal” based on a conversation he 

had with someone from escrow. At that time approximately $25,000 had been spent on 

renovating the Property.

The statement of decision

The trial court first overruled all of plaintiffs’ objections to the proposed statement 

of decision because plaintiffs failed to specify what relevant evidence the court omitted 

and “to appreciate that it was plaintiff which had the burden of proof on all issues . . . and 

the Court . . . found plaintiff’s evidence wholly unpersuasive.”8

8 Included among plaintiffs’ objections were: (1) the court did not consider that 

defendants admitted that Stensrudda had not participated in the 2011 transaction and that 

the Llewellyn deed of trust was a forgery; (2) there was no evidence that anyone other 

than Weiss or the Trust had paid the property taxes and the trial court’s proposed finding 

that it was “‘likely Stensrudda’” paid them had no evidentiary support; (3) there was no 

evidentiary support for the court’s speculation that Weiss was a lender when he paid 

$10,885 into the Property’s escrow account in 1970; (4) the court misunderstood 

plaintiffs’ legal argument when it employed the pretrial stipulation regarding 

Stensrudda’s not being an “aka” for Weiss to prevent plaintiffs from using the unrecorded 
13

The court identified as the initial question whether plaintiffs had standing to bring 

the lawsuit. The court opined that the answer to this question was “highly dependent on 

the testimony and credibility of Lesh who was the only witness for the Trust on this 

issue.” The court found that Lesh’s claim that the Property was owned by the Trust was 

primarily based on “a handful of contradictory documents many decades old” and 

uncorroborated hearsay from Weiss who had shown himself to be “historically 

untrustworthy,” having lied to a notary, an escrow officer, and a judge. To credit Lesh’s 

version of the events, the court observed it “would have to ignore her education, training, 

licensing and extensive experience in real estate and property management.”

The court then noted that it had “provisionally” allowed Lesh to testify about her 

conversations with Weiss about Stensrudda, but found that the evidence was not 

admissible under the family history exception to the hearsay rule in Evidence Code 

section 1310. The court admitted the evidence for the limited purpose of establishing that

Stensrudda was not a member of the Weiss family. The trial court added that it did not 

believe that the conversations ever happened because “[t]he entire story bordered on the 

preposterous,” given that not a single other family member testified to corroborate Lesh’s 

testimony.

The trial court further found that plaintiffs’ documentary evidence did not alter the 

latter conclusion. The court found that the “publicly filed documents actually support a 

conclusion that Stensrudda was a real person who bought [the Property] in 1970.” The 

court cited to the documentation of the 1970 purchase of the Property that showed 

Stensrudda to be the buyer. Specifically, the public records demonstrated that the probate 

court, the attorney for the Estate of Kaumeyer, the notary, the bank, and a title company 

“believed that Margaret Katrina Stensrudda existed.” The court further observed that no 

public document called Stensrudda’s existence into question and that no “independent 

witness testified that Stensrudda was not a real person.”

 

deed transferring the Property to the Trust to support their claim of ownership; and 

(5) there was no evidence linking Weiss’s fraud in 1970 to the forged deed by which 

Llewellyn took title to the Property.
14

The court did not find the “few bills, checks and rental records” to be persuasive 

and gave the payment of taxes on one occasion 30 years ago little weight. “The absence 

of other property tax records is another telling admission that someone other than the 

Trust or its trustees paid the rest of those bills.” The court called plaintiffs’ two bills and 

one payment for insurance “slim evidence as to the non-existence of Stensrudda.”

The court gave “no weight” to the rental agreements on the issues whether 

Stensrudda existed and on the ownership of the Property. Besides that the rental 

agreements were “pre-printed,” the court explained its reasoning: “Lesh admitted that 

she had last visited the property when she was a ‘little girl.’ In other words, she has no 

percipient information about who really owned or lived in the . . . property over the last 

40 years, including whether it was Stensrudda.” The court made no mention of the 

exhibits regarding Weiss’s or the Trust’s payment of repair bills for the Property.

Finally, the court stated that the exhibits showing Weiss’s payment out of his 

personal funds of the bulk of the purchase price into the Property’s escrow account in 

1970 was not “inconsistent with Weiss acting as a lender in the purchase.”

Based on the foregoing, the court concluded that the Trust had no claim to the 

ownership of the Property and thus no standing to bring the claims in the FAC.

The second issue the trial court discussed was whether plaintiffs were entitled to 

seek equitable remedies at all because of Weiss’s and Lesh’s fraud. The court found that 

Weiss and Lesh had unclean hands because for 40 years, they had fraudulently 

misrepresented ownership of the Property in the public record and to “multiple 

individuals.” The court also faulted Lesh for doing “nothing for many years to rectify the 

situation, that is until her brother-in-law filed this action.” The court further found that 

even if Lesh’s “story about her father is true,” her “cover[ing] up the original fraud”

“prejudice[d] . . . others, including Llewellyn, who relied on the public records.” The 

court then quoted Civil Code section 3543: “‘Where one of two innocent persons must 

suffer by the act of a third, he, by whose negligence it happened, must be the sufferer.’”

The court did not discuss the forged deed or the evidence on which the court relied to 

arrive at these conclusions.
15

Finally, the trial court found that Llewellyn did not have unclean hands because he

was entitled to rely on the public records, including the grant deed in Stensrudda’s name, 

it was not improper for him to flip property for a profit because that was “capitalism,” 

and nothing in the purchase price “suggests some nefarious conduct by Llewellyn.”

DISCUSSION

Substantial evidence did not support the trial court’s finding that plaintiffs did not 

own the land and lacked standing

The applicable standard of review

Plaintiffs, Anchor, and Llewellyn agree that the applicable standard of review is 

whether the trial court’s findings were supported by substantial evidence. Under that 

standard of review, our power “begins and ends with the determination as to whether, on

the entire record, there is substantial evidence, contradicted or uncontradicted, which will 

support” the trial court’s findings. (Bowers v. Bernards (1984) 150 Cal.App.3d 870, 

873–874.) We cannot substitute our own deductions from the evidence (id. at p. 874),

and we must resolve all evidentiary conflicts and indulge all reasonable inferences in 

support of the judgment (Leung v. Verdugo Hills Hospital (2012) 55 Cal.4th 291, 308). 

At the same time, “if the word ‘substantial’ means anything at all, it clearly implies that 

such evidence must be of ponderable legal significance. Obviously the word cannot be 

deemed synonymous with ‘any’ evidence. It must be reasonable in nature, credible, and 

of solid value; it must actually be ‘substantial’ proof of the essentials which the law 

requires in a particular case.” (Estate of Teed (1952) 112 Cal.App.2d 638, 644.)

Plaintiffs made a prima facie case of ownership under rebuttable presumptions 

of ownership based on plaintiffs’ uncontradicted possession and control of the 

Property

“The things which a person possesses are presumed to be owned by him.” (Evid. 

Code, § 637.) “A person who exercises acts of ownership over property is presumed to 
16

be the owner of it.” (Evid. Code, § 638.) “These provisions[9] are in accord with the 

settled law everywhere, and while such presumptions are disputable and may be 

controverted by other evidence, they afford full and sufficient evidence of ownership of 

land unless controverted [citation]. As against an entire stranger to the title, actual 

possession of land has uniformly been held, both in ejectment and actions to quiet title, to 

make out a prima facie case, sufficient to sustain a conclusion of ownership.” (Davis v. 

Crump (1912) 162 Cal. 513, 518.)

The presumptions set forth in Evidence Code sections 637 and 638 are 

presumptions established by law affecting the burden of producing evidence. (Evid. 

Code, § 630.) “The effect of a presumption affecting the burden of producing evidence is 

to require the trier of fact to assume the existence of the presumed fact unless and until 

evidence is introduced which would support a finding of its nonexistence, in which case 

the trier of fact shall determine the existence or nonexistence of the presumed fact from 

the evidence and without regard to the presumption.” (Evid. Code, § 604.)

We are mindful of our duty not to reweigh evidence and to make all inferences in 

support of the trial court’s findings. On the other hand, we are not a rubber-stamp, and 

where, as here, the trial court engaged in speculation in not crediting or in ignoring 

uncontested evidence supporting Weiss’s and the Trust’s possession and control of the 

Property, we are not obligated to affirm the resulting findings.

In evidence were decades of agreements renting out the Property in the name of 

Weiss or the Trust as landlord; indeed, some agreements provided an option to buy the 

Property with Weiss listed as the grantor of the option. The trial court gave them “no 

weight.” Lesh testified at length about these agreements. Defendants did not proffer any 

other rental agreements at trial. Lesh’s testimony on Weiss’s or the Trust’s possession of 

the Property was uncontradicted at trial. Defendants produced no evidence that anyone 

9 The reference is to the predecessor provisions of Evidence Code sections 637 

and 638.
17

else, let alone Stensrudda, entered into agreements with tenants to rent the Property or 

otherwise controlled its use.

The trial court dismissed Lesh’s testimony on the basis that Lesh was a “little girl” 

the last time she visited the Property and thus had no “percipient knowledge” about who 

lived in the Property. The court dismissed the rental agreements themselves as 

“preprinted.” First, not all the rental agreements were on preprinted forms; at least one 

was typed as a letter on Weiss’s office stationery. As noted above, the address on that 

letter was the same one that appeared on the escrow statement “c/o Weiss.”

The trial court ignored Lesh’s uncontradicted testimony that since she was 16, she 

became involved in managing her parents’ properties and soon thereafter became the 

manager for the properties, including the Property at issue here. Again, there was no 

evidence that anyone other than Lesh managed the Property, which management 

responsibilities included becoming familiar with the rental agreements, renting out the 

Property, and paying the Property’s expenses. There certainly was no evidence that 

someone named Stensrudda managed the Property, or rented, occupied, or otherwise 

possessed or controlled the Property.10

The trial court’s logic was also internally inconsistent. The major theme of the 

trial court’s decision was that based on Lesh’s experience in managing real estate and as 

a broker, she should have known better than being complicit in her father’s fraud. She 

gained that experience, however, by managing her parents’ and then the family Trust’s 

properties, but the trial court ignored that very experience in dismissing her familiarity 

with the use of the Property as that of a “little girl.”

The trial court merely speculates in finding that Weiss’s substantial payment 

($10,885) toward the $12,000 purchase price for the Property in 1970 was not 

10 As set forth ante, the trial court found that the public records demonstrated that 

the probate court, the attorney for the Estate of Kaumeyer, the notary, the bank, and a title 

company “believed that Margaret Katrina Stensrudda existed.” There was no witness 

from the bank, the seller’s estate, the escrow company, or the notary to support the 

court’s finding as to these persons’ beliefs.
18

“inconsistent with Weiss acting as a lender in the purchase.” The evidence that Weiss

had made this payment toward the purchase of the Property was uncontracticted. In 

contrast, there was no evidence to support an inference, let alone a finding, that he did so 

as a mere lender.

There was similarly no evidence at trial that anyone other than Weiss or the Trust 

paid the taxes on the Property. Again, Lesh testified extensively about her role as 

manager in paying the property taxes on Trust properties and that the taxes on the 

Property were never delinquent. There was no evidence that Stensrudda, or anyone other 

than Weiss or the Trust paid the taxes. The fact that Lesh brought to court only a few tax 

bills does not alter the complete absence of evidence to support that anyone other than 

Weiss or the Trust paid these expenses and possessed the Property. The same is true for 

Lesh’s uncontradicted testimony that Weiss or the Trust paid the insurance for the 

Property. The trial court, moreover, made no mention of the repair bills for the Property 

in evidence addressed to Weiss, which too demonstrated possession and control of the 

Property. Again, there was no evidence that anyone other than Weiss or the Trust paid 

repair expenses for the Property.

For all these reasons, plaintiffs were entitled to the benefit of the rebuttable 

presumptions of ownership under Evidence Code sections 637 and 638, and the burden of 

coming forward with evidence that Stensrudda was a real person shifted to defendants.

Llewellyn argues that the Trust waived the benefit of the presumption of 

ownership under Evidence Code sections 637 and 638 by not raising that “argument” in 

the trial court. We find Llewellyn’s argument curious. Failing to inform the trial court of 

applicable legal authority is not waiver of an argument. It is all counsels’ obligation to 

inform the trial court of the relevant law, and not to lie in wait on appeal. We have 

discretion in the interests of justice to consider points not raised below, and have 

exercised our discretion to do so here.11

11 “There are many situations where appellate courts will consider such matters

[issues raised for the first time on appeal]. They will often be considered where the issue 

relates to questions of law only. (Tyre v. Aetna Life Ins. Co., 54 Cal.2d 399, 405; Jones 
19

Second, as set forth above, the presumptions here mattered. At trial, the court 

inquired into defendants’ “theory” as to who was Stensrudda. Anchor’s counsel 

responded that he did not need one because it was “plaintiff’s burden to show that she 

didn’t exist.” Llewellyn’s response was more forthcoming: “[W]e don’t know whether 

or not Ms. Stensrudda herself existed.” Nor did defendants proffer the testimony of 

Michael, the only witness who Nichols and Wells testified had contact with “the seller.”

The court’s finding that equitable relief is not available to plaintiffs because of 

Weiss’s misrepresentations in 1970 and Lesh’s failure to correct those 

misrepresentations is not supported by substantial evidence because defendants’ 

respective claims to title were obtained through a forged deed and there was no 

evidence that Weiss’s fraud caused the forgery

“There is no question but what the forged deed is absolutely void, and even in the 

case of a person claiming in good faith thereunder, is inoperative, either to divest the 

purported grantor’s title or to vest any right or title in the grantee or claimant.” (Gioscio 

v. Lautenschlager (1937) 23 Cal.App.2d 616, 619.) The statement of decision makes no 

mention of this law.

Llewellyn cites Civil Code section 3543, providing “[w]here one of two innocent 

persons must suffer by the act of a third, he, by whose negligence it happened, must be 

the sufferer,” and argues that Weiss’s fraud and Lesh’s failure to remedy the fraud estops 

plaintiffs from seeking equitable relief here. Llewellyn relies on Crittenden v. McCoud

(1951) 106 Cal.App.2d 42 (Crittenden) and Merry v. Garibaldi (1941) 48 Cal.App.2d 

397 (Merry) to support its estoppel defense. The problem with Llewellyn’s arguments is 

 

v. Fireman’s Fund Ins. Co., 270 Cal.App.2d 779, 783-784.) Appellate courts are more 

inclined to consider such tardily raised legal issues where the public interest or public 

policy is involved. (People v. Rodriguez, 58 Cal.App.2d 415, 421.) Whether the rule 

shall be applied is largely a question of the appellate court’s discretion. (Isthmian Lines, 

Inc. v. Schirmer Stevedoring Co., 255 Cal.App.2d 607, 610.)” (Bayside Timber Co. v. 

Board of Supervisors (1971) 20 Cal.App.3d 1, 5.) The rule requiring the matter to have 

been raised in the trial court “does not apply to matters involving the public interest or the 

due administration of justice, e.g., illegality or unclean hands. [Citations.]” (9 Witkin, 

Cal. Procedure (5th ed. 2008) Appeal, § 406, p. 465.)
20

that they hinge on a causation theory for which there was no evidence at trial, to wit, that 

Weiss’s fraud in 1970 and Lesh’s failure to correct the public record made the forgery 

possible, thus causing Llewellyn harm.12

In Crittenden, the plaintiff lawyer claimed title through a deed that he knew to 

have been forged, indeed as to which forgery he was an active participant. More 

specifically, he impersonated his client (who was then incarcerated and had told his wife 

to get rid of real property) in obtaining notarization of a deed of trust transferring full title 

to real property to the client’s wife. Later on, the wife sold the property to the defendant. 

The client, then out of prison, was with his wife when she cashed defendant’s check for 

payment of the Property and immediately purchased a new property. At no time did the 

client disclose to the defendant that defendant’s deed was forged, although the client 

knew his signature had been forged at the time he and his wife cashed the defendant’s 

check and had purchased a new property. Subsequently, the client conveyed a half 

interest in the property to his lawyer, who sought to quiet title against the defendant. 

Under these facts, the appellate court found that the plaintiff attorney was estopped from 

denying the validity of the forged deed. (Crittenden, supra, 106 Cal.App.2d at pp. 48–

50.)

In Merry, the plaintiff sought to cancel a promissory note and deed of trust 

securing that note even though she knew that her son-in-law had forged her name on 

those documents and she had not informed the defendant lenders of the forgery when she 

found out about the forgery. The loan eventually became delinquent. The appellate court 

held that the plaintiff was estopped from asserting that the deed of trust securing the loan 

was a forgery. (Merry, supra, 48 Cal.App.2d at pp. 402–403.)

Llewellyn’s harm derived from the forgery because he could not obtain good title 

from the forged deed. Unlike in Crittenden and Merry, which applied estoppel principles 

to avoid the harsh results of that general rule, there was no evidence before the trial court 

12 Anchor concedes that the law of unclean hands “requires that the conduct 

complained of harm the defendants[.]”
21

how the forgery happened, let alone evidence that Weiss or Lesh knew that Llewellyn’s 

deed was forged. There was no evidence that Weiss’s putting the deed of trust in 

Stensrudda’s name in 1970 or Lesh’s failure to correct that false deed in any way enabled 

or caused the forgery. There was no evidence to invoke Civil Code section 3543 because 

there was no evidence that Weiss’s or Lesh’s conduct caused the forgery to “happen.”13

Anchor’s lawyer appears to have conceded this failure of proof when he argues 

that “[b]ecause this argument was not presented below, no evidence was present on the

part of the Appellant to support his view, and similarly, no evidence was presented by the 

Respondents to counter it.” (Italics added.) Anchor merely argues without evidentiary 

support that “it stands to reason that the Property being held in the name of . . . a nonexistent pseudonym would make it exponentially more likely to commit the kind of fraud 

alleged to have been committed here: a forgery of the deed conveying title to 

Llewellyn.”14

Anchor’s arguments are somewhat disingenuous. Plaintiffs vigorously objected to 

the trial court’s proposed statement of decision because, among other grounds, the court

did not consider that Llewellyn’s deed was a forgery and that there was no evidence 

linking Weiss’s fraud to that forgery. (See ante, fn. 8.)

13 To the extent negligence was an issue, one could argue that the evidence 

supports Llewellyn’s negligence in purchasing property knowing that there was no one 

representing the seller in the transaction, which Nichols described as unusual, and the 

only one he and Wells understood interfaced with the seller was Michael, whom the 

defendants did not proffer as a witness at trial. The trial court found it “extremely 

telling” that other Weiss family members did not testify about Weiss’s disclosures that 

Stensrudda was not a real person, but arguably far more telling was the absence of 

Michael as a witness for defendants.

14 Anchor faults Lesh for choosing to bring suit instead of “contact[ing] [counsel]

to determine if there was a legal remedy to fix the title issue[.]” Anchor suggests that 

Code of Civil Procedure sections 770.020 and 770.050 would have provided such a 

remedy. (We note that Anchor incorrectly cited these sections as appearing in the Civil 

Code.) Anchor, however, does not explain why it could not have employed that same 

remedy, and there is nothing in the record indicating that it has yet done so.
22

Anchor argues for the first time on appeal that it had to defend this case because 

the “real Margaret Stensrudda” could sue them for the same claims. We have difficulty 

understanding this argument because defendants’ title problems stem from the forged 

deed as to which there was no evidence that Weiss played any role.

DISPOSITION

The judgment is reversed. The case is remanded with directions to cancel the

grant deed recorded on May 6, 2011, conveying the Property to Llewellyn Properties 

LLC and the assignment of deed of trust recorded on May 27, 2011; order defendants to 

deliver possession of the Property to plaintiffs; declare that plaintiffs have a fee simple 

interest in the property; and try the parties’ competing claims for monetary relief, that is, 

plaintiffs’ claims for money damages and defendants’ offset defenses. Appellants are to 

recover their costs on appeal.

NOT TO BE PUBLISHED.

BENDIX, J.*

We concur:

ROTHSCHILD, P. J.

JOHNSON, J.

* Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant 

to article VI, section 6 of the California Constitution.