California Partition Law Blog
This article is about whether a personal lien, like a lien for child support, can attach to real estate. This is important because property can be used as collateral for debt voluntarily or involuntarily. This means the owner of the property uses the property as collateral by having a lien placed on it.
What is a personal lien?
A lien applies to future property bought by the debtor, the heirs of the estate if the debtor dies, and any property the debtor transfers into a revocable living trust. Liens implicating personal debts like child support are likely to arise as judgment liens. This means a court can impose the lien when someone does not repay a debt. They can be voluntary with the homeowner (or property owner) choosing to use their property as collateral or involuntary if the court has ordered the lien against the owner’s wishes. (CCP § 697.320)
This means the creditor, or the person owed money, can place a judgment lien on the debtor’s real estate or personal property. This is done by mailing an Abstract of Judgment to the county recorder’s office. (CCP § 697.390) An Abstract of Judgment is a document summarizing the court’s decision entitling the creditor to the lien. (In re Marriage of Orchard (1990) 224 Cal.App.3d 155, 157.)
When the Abstract of Judgment has been recorded it creates a general lien on the property currently owned by the debtor. This will impact the value of the property and the profits received by the owner because the debtor must pay off the debt when selling the real estate.
This reminds the debtor of what they owe as well as applying to any property they will try to buy in the future for the next few years depending on the type of lien. This general lien ensures the creditor gets their money when the owner of the property sells it or refinances it. (Federal Deposit Ins. Corp. v. Charlton (1993) 17 Cal. App. 4th 1066, 1069.) These liens can also attach to joint tenancy property if the debtor owns it with others or to a debtor’s ownership interest in a partnership that owns real property.
What does this mean for a personal lien like child support?
In California, a parent who is the noncustodial parent without primary physical custody of a child is required to provide child support payments. A paying parent falls into arrears on child support payments when they do not make them. This means the court may place a lien on property owned by a parent who is not making their payments. (CCP § 697.320.)
If the abstract lacks information and is not properly recorded it is void. (Lawyers Title Co. v. Bradbury (1981) 127 Cal.App.3d 41, 45.) A lack of information could be that the full amount of the judgment is not on the abstract recorded or the amount owed or number of children involved is not apparent on the document. (Ellrott v. Bliss (1983) 147 Cal.App.3d 901, 905.)
If there are multiple liens on a property, the priority the liens get is set out in Civil Code section 2897. This is usually done by time of the lien’s creation. (Cetenko v. United California Bank (1982) 30 Cal.3d 528, 534.)
Liens on property pass when the property is transferred if they are not paid off. However, a lien for child support implicates a personal debt. The interest of a lienholder is derivative of the debtor. (Hi-Valley Development Corp. v. Walters (1963) 223 Cal.App.2d 778, 783.) This means the creditor cannot reach assets the debtor does not have interest in. This means when the lien will not necessarily just attach to title if the property were to be transferred to a different person. (20th Century Plumbing Co. v. Sfregola (1981) 126 Cal.App.3d 851, 854.) A potential buyer would likely require that a child support lien be paid and lifted before they would agree to buy the real estate.
It is a personal debt and not one a third party would or should be responsible for. Similarly, once a debtor has no interest in the property the creditor cannot attempt to enforce a lien that may have previously been on the property now that it is under new ownership. (Henry v. General Forming, Ltd. (1948) 33 Cal.2d 223, 226.) This means the transfer of the property means the debtor owing child support no longer has an interest in the real estate. However, the child support lien may attach to new property if it was not paid off.
What would an example of a personal lien on property look like?
For example, “Julie” and “Shawn” were married and had a child. They eventually divorced, with Julie taking custody of the child. Julie found an apartment and Shawn moved into a property he owned separately of the marriage. Following the divorce, Shawn was required to make child support payments to Julie. Eventually, Shawn began to not make the payments. Julie got upset and the amount began to add up, so she chose to record an abstract of judgment by mailing the divorce judgment requiring payment of child support. This allowed Julie to place a lien on Shawn’s home.
If Julie had filed an incomplete abstract of judgment without making sure to include the amount Shawn owed in arrearages and did not specify which child, it was for she would not successfully place a lien on Shawn’s property. If Julie improperly pursued a lien, she risks not being compensated. It would also pose an issue if other liens were placed on Shawn’s property.
Conclusion
A lien is an encumbrance placed on property to ensure payment of a debt. While vendors or tax liens can apply to property so too can personal liens, taking the form of a personal debt owed like child support. When a lien for child support is placed on property it attaches and is not lifted until the owing parent pays the debt. Where there are competing liens, a personal lien like one for child support may not get priority over others.
The Underwood Law Firm has a team of experienced lawyers who can help resolve your real property issues as they relate to partition and help you pursue solutions to ensure your property rights are protected. We are here to help.