Code of Civil Procedure (CCP) Section 873.750 – Court Order for Collection of Proceeds and Transfer of Property

Code of Civil Procedure section 873.750 outlines Court jurisdiction and instructions to the partition referee after a partition sale has been completed and confirmed. It grants the court wide latitude to order to referee not only to distribute the sales proceeds, but to also deposit and secure sales deposits pending distribution.

Code of Civil Procedure section 873.750 states:

(a) Upon confirmation of a sale, the court shall order the referee to execute a conveyance or other instrument of transfer, to collect the proceeds, take security, and perform other acts required to consummate the sale.

(b) The order directing the referee concerning distribution, deposit, or securing of sales deposits and sales proceeds.

“Shawn” and “Julie” are an unmarried couple who want to start a life together. They find a nice home in Los Angeles and buy it as joint tenants. They move in and start their new life together.

Unfortunately, Shawn and Julie’s relationship doesn’t work out, and they break up. They cannot agree on what to do with the property. Shawn wants to sell all the property and move on with his life, so he sues for partition by sale.

Eventually, the court orders the property sold and the sale proceeds distributed. The court concludes that the property will be sold at a private sale. When it is sold, the court confirms the sale after the referee submits the report of sale to the parties and the court. The court then orders that the referee sign the deed to transfer the property to the buyer.

The court also orders the sales proceeds be deposited into an interest bearing account pending resolution of accounting issues between Shawn and Julie, pursuant to Section 873.750.

1976 Addition.

Section 873.750 continues the substance of the first two sentences of former Section 785 and supersedes former Section 777. Section 873.750 states the court’s authority in broader terms than the former sections, which referred only to “proceeds of sale.” These are to be distributed to the person entitled when the court directs or are to be paid into court or deposited therein. However, substantial sums may be held by the referee or others pending a sale. These funds, as well as technical “proceeds of sale,” should be subject to the court’s order. For provisions concerning the disposition of the proceeds of sale, see Article 4 (commencing with Section 873.810.)

Like with many of the partition statutes, section 873.750 does not include a an “official” Assembly Committee Comment from the California Legislature. But this is not uncommon. In fact, the Legislature endorsed an overall adoption of the Law Revision Commission suggestions when it passed the new partition statutes in 1976.

Case in point, the introduction to Assembly Bill 1671 (the bill that contained the new partition laws) states that the Revision Commission’s recommendations “reflect the intent of the Assembly Committee… in approving the various provisions of Assembly Bill 1671.” This demonstrates that the intent of the Legislature was essentially in line with that of the Revision Commission.

As to the comment here, it makes mention that it both continues and supersedes former statutes that were repealed in 1976. It continues the first two sentences of former section 785, which read:

“If the sale is confirmed by the court, an order must be entered, directing the referees to execute conveyances and take securities pursuant to such sale, which they are hereby authorized to do. Such order may also give directions to them regarding the disposition of the proceeds of the sale.”

As one can see, today’s statute is certainly more expansive than it previously was. Instead of referring only to “proceeds of the sale,” it now allows the court order on proceeds to address distribution, deposit, and security of sale deposits. (CCP § 873.750.)

Nonetheless, prior case law interpreting former section 785 is not without value. For example, an early Supreme Court case illustrates that a partition sale is not truly done and over with until it has been both reported and confirmed by the Superior Court overlooking the case. (Schoonover v. Birnbaum (1907) 150 Cal. 734, 736.)

Thus, confirmation of the sale is an essential aspect of partition litigation. And the order on sales proceeds and distribution cannot occur until the sale itself has been confirmed.

Perhaps the most interesting aspect of this statute, though, is the unspoken jurisdictional rules it provides. Suppose that after the court confirms the sale, it orders the proceeds to be split 50/50 between two parties. This is basically a nail in the coffin for most other issues related to the partition, unless one party wants to take an appeal.

One the distribution is ordered, the order becomes “final” in the court. (Widenmann v. Weniger (1913) 164 Cal. 667, 675.) “Nothing remain[s] to be done by the court, except to settle the account of the referees after they had made the payments as previously directed.” (Id.) Stated differently, where there has been a partition sale and there is only money to be divided, the court has the right to order that money divided. (Hirschberg v. Oser (1947) 82 Cal.App.2d 282, 288.)

Here at Underwood Law Firm, our knowledgeable attorneys are here to help navigate the complex web of case law and statutes surrounding partitions. If you are thinking of filing a partition, are already in the midst of a partition suit, or just have any questions, please do not hesitate to reach out to our office to learn more about Partition Law.