Legal Question in Real Estate Law in California

No, simply being located on the property owned by X does not give Y, X's spouse, the right to sell items of personal property.

First, one must distinguish the real property (also called real estate) that is subject to the loan from the personal property which is on the real property, such as tractors, tools, etc. The personal property is PROBABLY not subject to the deed of trust securing the loan, and the foreclosing lender can't take that personal property as partial satisfaction of the loan indebtedness. The lender can only foreclose on the real property itself (at least in most cases; I suppose in rare instances there might be a supplemental security instrument pledging the equipment as additional collateral).

Next, the personal property (tractors, tools, etc.) is probably community property. The ownership and control of community property is covered by the Family Code, in particular section 1100. This section gives either spouse an absolute power of disposition in most cases (FC 1100(a), but see also FC 1100(b) and (c)). Further, if the husband is carrying on a farming business without much input from the wife, his right to dispose of farm machinery is further subject to Family Code section 1100(d).

Further, spouses are considered to be fiduciaries of one another, meaning that each must act with respect to their community property in a totally open, fair, honest and responsible manner, and may not take advantage of the other spouse by concealment, trickery or otherwise. FC 1101.

Finally, the matter of property being "in her name" or "in his name" is NOT fully dispositive of true ownership. Ownership of property may, and often does, change, either abruptly or gradually, during marriage. For example, when H and W marry, the farm that was owned solely by H on their wedding day will gradually develop a community-property character if it is subject to a loan which is paid from either H's or W's paycheck after marriage. In a long marriage, the property can become nearly 100% community property, meaning that H and W are, effectively, near equal co-owners.

This couple could perhaps benefit from some financial and/or legal counseling so they wake up and cooperate before the mortgage man sells the farm.