Brock

In this case we must decide which of two liens arising simultaneously out of a single transaction for the sale of real property—a vendor’s lien and a purchase-money deed of trust—has priority. We shall hold that under common law principles codified in the pertinent statutes, the purchase-money deed of trust prevails.

Plaintiff and respondent Harold A. Brock sold the property in question to a corporation, but did not receive the full purchase price from the buyer; instead he accepted the buyer’s unsecured promissory notes for a part of the price, while the buyer obtained a loan from defendant and appellant First South Savings Association (First South), secured by a deed of trust on the property, for the balance of the price. After escrow closed, the buyer defaulted on the loan and the promissory notes, and First South foreclosed on the property. Brock subsequently filed suit against First South, asserting the priority of his vendor’s lien over First South’s purchase-money deed of trust. Following a court trial the trial court entered judgment for Brock, from which First South appeals.

On appeal each party relies on provisions of the Civil Code which, considered in…