Dmc, Inc. v. Downey Savings and Loan Assoc.

1. Introduction

Plaintiff DMC, Inc. (DMC) filed an action for judicial foreclosure and declaratory relief to determine whether its deed of trust had priority over defendant Downey Savings and Loan Association’s (Downey) deed of trust. After finding that Downey’s purchase-money deed of trust was senior to DMC’s lien, the court granted Downey’s motion for summary adjudication and entered judgment accordingly.

On appeal, DMC claims that, because Downey failed to present any admissible evidence to establish the character of its lien as a purchase-money deed of trust, the court erred in making this initial finding. DMC alternatively claims that, because both debts were purchase-money deeds of trust and because DMC’s lien was recorded first in time, the trial court erred in making its ultimate finding that Downey’s lien was senior to DMC’s lien.

Even if Downey presented inadequate evidence to establish the purchase-money character of its lien, undisputed facts in the record reveal that the debtor, Sharon Henry, obtained a mortgage loan from Downey to repurchase her home after the original foreclosure proceedings. Moreover, assuming that DMC’s lien reattached after the…