Legal Question in Credit and Debt Law in California

Re: Real Property Levy

The key to answering your question is Probate Code Sections 18200 & 18201. If the debtor retains the full power to revoke the trust, then the property can be reached by judgment creditors. However, there are practical considerations that you must look at.

In most cases, the Sheriff's Department will follow whatever instructions you give. If the property is held by "John Smith, as trustee of the Smith Family Trust of 2002", you could probably levy and sell the property. You might even be able to evict the tenants and gain possession, but what if you can't get title insurance when you want to sell it?

One option to consider would be to contact a title insurance company about a litigation guarantee, which is basically the lawsuit version of title insurance. If you follow the requirements of the litigation guarantee, you should be able to get marketable title after the levy and sale.

You might also consider going back and getting an order modifying the judgment or directing the Sheriff to levy even though the property is in the trust.

Your third and most expensive option is filing a quiet title lawsuit after the execution sale. This would resolve any doubts as to the status of the title to the property.

If you need further assitance, feel free to contact my office.

Re: Real Property Levy

You may be able to levy against that property. We would have to review your documentation to determine if you have a good case. Even if he transferred the property to an entity without consideration, you may have a claim under the fraudulent conveyance statutes.

Re: Real Property Levy

You should still be able to levy. The L.A. County Sheriff will in general allow the levy to go forward, even if the property has been placed into a revocable trust, and put the onus on the debtor to get a court order stopping the levy. In other counties, the Sheriff may be more wary, and you might have to get a judge's order first. That shouldn't be difficult, because legally a creditor can levy upon real property in a debtor's revocable trust just the same as if it was in the debtor's name. If it turns out you need legal help in enforcing your judgment, feel free to contact me.

Re: Real Property Levy

If the revocable trust are such that the debtor (person who owes the money) is trustee and beneficiary of the trust, then yes you can levy.

If the debtor has transferred the property to someone else you can still take action but it may be part of a larger action for conspiracy to defraud you as a creditor.

You may want to sit down with an attorney and discuss your options.