Court Opinion

ID: 9527860
Source: CourtListenerOpinion
Date Created: 2023-08-07 03:34:59.612276+00
Date Added: 2024-06-11T13:26:15.309273
License: Public Domain

VAN CISE, Judge,
specially concurring.
I concur in the result.
On June 15, 1977, the Campbells, as sellers, entered into the contract with the Ran-dals as purchasers, for sale of 11.26 acres out of their 40 acre tract. At that time, the Randals acquired equitable title to the 11.-26 acres, see Ulander v. Allen, 37 Colo. App. 279, 544 P.2d 1001 (1976), and the Campbells retained legal title to the entire 40 acres subject to the liens of the first and second deeds of trust as to the 40 acres and subject to the Randals’ newly acquired equitable title to the smaller tract.
A few days later, a new second deed of trust was executed as to the entire 40 acres to secure a new loan by Citicorp, and the former second deed of trust was released. This new second trust deed was junior to the preexisting first trust deed and was subject to the Randals’ equitable title to the 11.26 acres based on their contract.
*34Had the Campbells sold their interest in the 40 acres to Citicorp, without specifically retaining the right to the proceeds of sale from the Randals, Citicorp would have stood in the shoes of the Campbells with respect to the contract. It would have had “the rights as well as the obligations — the rights to receive the balance of the purchase price ... and the obligations to deliver possession and to convey title on payment of the purchase price.” Century Enterprises v. Butler, 526 P.2d 1350 (Colo. App.1974) (not selected for official publication). See also Walker Inv. Co. v. Fleming, 79 Colo. 434, 246 P. 207 (1926), and Johnson v. Perry, 20 Wash.App. 696, 582 P.2d 886 (1978).
However, this was a loan and not a sale transaction, and the deed of trust referred only to the land and did not specifically refer to the contract either as included in the property securing the loan or as an encumbrance. And, since a deed of trust is a lien and not a conveyance, regardless of its terms, § 38-35-117, C.R.S. (1982 Repl. Vol. 16A), the Campbells did not convey the legal title. They still owned it when they assigned to the Bank the right to receive the proceeds of the sale contract.
The Campbells were not divested of the legal title until Citicorp received a public trustee’s deed to the 40 acres following foreclosure and sale. . At that time, standing in the shoes of the Campbells, Citicorp acquired legal title subject to the lien of the first trust deed and the obligations under the Randal contract, with Citicorp’s rights under the contract being limited to the right to terminate on default in compliance with the terms of the contract, and a right to proceeds junior to the lien of the Bank on those proceeds.
Therefore, the trial court erred in granting summary judgment to Citicorp and in denying summary judgment to the Bank as to the right to the installment land contract proceeds.