Legal Question in Real Estate Law in California

Re: Purchased a home

There are key facts missing here, but it is pretty clear to me that you do belong "on title" as to some percentage - not necessarily 50%, maybe more, maybe less, but not 0% either.

The general rule is that when someone can prove that they contributed some or all of the down payment ("purchase money") for property, but received a smaller share of title than their contribution would indicate, the rest of what their money should have bought is presumed held in trust for them by the copurchaser who got the unreasonably-large chunk of title.

This legally-presumed trust arrangement is involuntary, automatic and doesn't require a writing. The involuntary trustee (here, your partner) has a duty to convey your share to you upon demand.

The presumption of a trust does not arise in cases where the better presumption is that the person who got shorted probably intended to make a gift, as where it is a parent who puts up the extra money and the child who receives the unexpectedly large share of title. Further, the trust presumption can be rebutted by evidence showing that no trust was intended and the result shown on the public record is correct because the parties had a contract for the result obtained.

The overall legal concept here is called "purchase-money resulting trust" and is often combined with or used as an underlying theory in suits to quiet title and/or for partition.

So, questions remain: (1) How much did the partner contribute to the down payment? (2) How much equity is in the house? (3) What causes of action are asserted in the existing suit? (4) What stage is the suit at, i.e. has discovery been conducted or has a trial date been set? (5) Why are you now pro se? (6) Who has made the mortgage, tax, insurance etc. payments? (7) How strong is your proof of the facts?

Finally, I am somewhat doubtful about the fiduciary duty of a mortgage broker to the borrower, especially with regard to delivering or using gift letters in the escrow instructions or closing process. Your real estate broker, if you used one, should have attended to this, or at least should have taken some steps to make sure title was taken as the parties intended.

Please contact me directly if you would like to discuss representation in this matter.

Re: Purchased a home

OK, I've done a little research on the duties of DRE-licensed mortgage brokers, and indeed they do owe fiduciary duties to both the lenders they represent and borrowers who apply for loans through them. The duty to the borrower continues at least through funding. I could not, in a reasonable amount of research time on a "freebie," find any law or case indicating that the mortgage broker is in any way responsible for the outcome of escrow, or that there is any duty to deliver all source-of-funds documents to escrow. So, as things now stand, I'm unable to say whether the mortgage broker breached any fiduciary duty to you. However, I don't think this is necessarily crucial to winning an action to having your name placed on title as a co-owner as to some share of the fee.