Division Three of the Washington Court of Appeals recently considered how far a court could go to force a property owner to clean up his personal property after a non-judicial foreclosure. The Court’s answer is that inherent in the Court’s power to order the restitution of possession of property to the winning bidder at a trustee’s sale is the power to force the owner to clean up his mess or take steps to sell or dispose of the property.
In the case of Excelsior Mortgage Equity Fund II, LLC v. Schroeder, (No. 30333-1-III), the lender had conducted a trustee sale in February 2010 of some 200 acres of ranchland in Stevens County. The ranch was littered with hundreds of vehicles, bicycles, and parts of both, as well as cattle. While RCW 61.24.010(1) provides that the successful bidder is entitled to possession of a foreclosed property twenty days after the trustee’s sale, the bank extended the time for the owner to remove his personal property from the land. Finally, at the end of April, 2010, the bank brought an unlawful detainer action under RCW 59.12 against the former landowner. It wasn’t until December 2010 that the Court granted a judgment of unlawful detainer and provided that a writ of restitution should be issued to the sheriff to deliver possession of the land to the bank.
Thereafter, the bank brought a motion to enlist the Court’s authority to help it clear the land of the borrower’s property. Because the borrower wasn’t living on the land, the normal writ of restitution function of “dispossessing” the occupants wasn’t at issue. The bank needed to get the property of the borrower off the land. The bank asked the court to fashion a process similar to the process in the Residential Landlord-Tenant Act (RCW 59.18) allowing a certain time period for removal of the property, and if not so removed, then to allow the sale and/or disposal of the property. The borrower resisted the process, because the unlawful detainer statute for this commercial property did not provide any such procedure.
More than two hundred years ago, the US Supreme Court in Marbury v. Madison decided that courts had certain inherent rights and powers, in that case the power to determine the constitutionality of legislation. Following this same tradition, the Washington Court of Appeal decided, without any specific legislative authorization, that it had the inherent right to enforce the judgment previously entered, awarding possession of the land to the bank. In order to award sole possession, it was important to remove the many vehicles and other property which littered the land. The Court reasoned that without the power to fashion a process for removing the animals, vehicles and bicycles and parts, the bank couldn’t enjoy its possession of the property.
This ruling is not revolutionary within the confines of this case, but it is interesting to consider the extent of the court’s inherent rights in this regard. If the property were contaminated with pollutants, would a court be entitled to order the borrower to clean up the property or reimburse the owner in the absence of an environmental tort action or statutory right? If physical access to a parcel was impractical due to the destruction of a bridge over which one needed to travel to access a property, would the court’s inherent power to grant possession be similarly offended?
My biggest question about this entire imbroglio is why the borrower fought the process, rather than using his remaining assets to remove and/or sell his vehicles and cattle in the over one year he had to do so? Maybe we’ll find out if and when this case makes it to the Supremes in Olympia.
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