Thaler

Michael Thaler (Thaler) appeals from an order sustaining respondents’ demurrer to his first amended complaint without leave to amend. He contends the trial court erred in finding, under Civil Code section 1367, that his interest in certain real property was subordinate to the second deed of trust of one of the respondents. This appeal presents a question of first impression regarding the relative priority of a homeowner association assessment lien and an earlier-recorded second deed of trust, under section 1367, where preexisting covenants, conditions, and restrictions (CC&R’s) on the property recite a “present lien” with power of sale to secure payment of such assessments. We conclude, notwithstanding the CC&R’s, that the second deed of trust has priority over the later-recorded notice of delinquent assessment. Accordingly, we affirm the order of the trial court.

I. Facts and Procedural History

In 1998, Thaler purchased a condominium at a nonjudicial foreclosure sale held pursuant to an assessment lien that had been recorded on the property in 1997. Also in the record of title was a second deed of trust recorded in 1992 by the predecessor of respondent Household…