Opinion ID: 2038451
Heading Depth: 1
Heading Rank: 8

Heading: Mere Legal Title

Text: Next, Beverly argues that the district court erred in failing to find that a lien on the property existed prior to the time the quitclaim deed was executed. According to Beverly, under Neb. Rev. Stat. § 25-1504 (Reissue 1995), a judgment lien attaches to the land of a debtor the day the judgment is rendered. Therefore, because Roger was in arrears on his child support obligation, Beverly contends that a judgment lien attached to Roger's interest in the property on June 12, 1992, the date the deed of trust was recorded in Douglas County. [9] As the district court noted, however, a lien of judgment does not attach to the mere legal title where the equitable and beneficial interest is in another. Action Realty Co., Inc. v. Miller, 191 Neb. 381, 215 N.W.2d 629 (1974); Knaak v. Brown, 115 Neb. 260, 212 N.W. 431 (1927). In such a situation, equity allows a court to break free from the normal chains of legal title and disregard a lienholder's claim to the interest of a debtor who holds mere legal title. In the instant case, based on our de novo review, we conclude that the record is replete with evidence which establishes that Roger's interest in the property was that of mere legal title and that all the equitable and beneficial interests in the property resided with Lisa. For example, both Roger and Lisa testified that it was Lisa who wished to construct the house and that it was only after Lisa was refused financing that she turned to Roger. Although Roger cosigned the loan, both parties agreed that Lisa made the downpayment for the property, as well as all of the subsequent mortgage payments. Lisa also paid for the needed repairs and improvements to the home, in addition to paying for the furnishings for the home. Furthermore, Lisa testified that she was the sole decisionmaker when it came to the property and believed she could have sold it without Roger's approval. Likewise, Roger testified that he did not believe that he owned the property. Although Beverly makes much of the fact that the warranty deed and a few of the loan documents contain references to Roger and Lisa as husband and wife, both Roger and Lisa testified that (1) they never conveyed this information to their financing agent, (2) their financing agent never asked about their marital status, and (3) they signed the documents in a hurried manner without closely reading them. Furthermore, both Roger and Lisa testified that after their divorce, they continued to live together only because they believed it was in their child's best interests. By leaving Lisa's home shortly after his child's departure (and before the initiation of Beverly's suit), Roger demonstrated that he did not consider the property to be his own. In sum, the evidence revealed that Roger's interest in the property was that of mere legal title and that all the equitable and beneficial interests in the property resided with Lisa. Therefore, the district court correctly concluded that Beverly's judgment lien did not attach to Roger's limited interest in the property.